HOUSEHOLD INTERNATIONAL INC, S-4/A, 1999-12-28

HOUSEHOLD INTERNATIONAL INC
S-4/A, 1999-12-28
PERSONAL CREDIT INSTITUTIONS

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<PAGE>

As filed with the Securities and Exchange Commission on December 28, 1999

Registration No. 333-93081
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

---------------
AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
Under
The Securities Act of 1933

---------------

Household International, Inc.
(Exact name of Registrant as specified in its charter)

---------------
Delaware 6711 36-3121988
(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Classification Identification No.)
incorporation or Code Number)
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)

---------------

John W. Blenke, Esq.
Vice President-Corporate Law
and Assistant Secretary
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
(847) 564-6150
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
Alan R. Blank, Esq. Russell J. Bruemmer, Esq.
Stoel Rives LLP Wilmer, Cutler & Pickering
700 NE Multnomah, Suite 950 2445 M Street, N.W.
Portland, Oregon 97232 Washington, D.C. 20037
(503) 872-4816 (202) 663-6804

Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement and all
other conditions described in the enclosed Prospectus have been satisfied or
waived.

If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, check the following box. [_]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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 this Form is a post-effective amendment filed pursuant to Rule 462(d)
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. [_]

---------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.

- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<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 State. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, Dated December 28, 1999

Renaissance Holdings, Inc.
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, Oregon 97005-3363

December 31, 1999

Dear Fellow Shareholder:

You are cordially invited to attend the special meeting of shareholders of
Renaissance Holdings, Inc. to be held on February 1, 2000 at 9:30 a.m. at the
offices of Renaissance located at 9400 SW Beaverton-Hillsdale Hwy., Suite 300,
Beaverton, Oregon 97005. At the meeting you will be asked to approve:

. the agreement and plan of merger that calls for the merger of Renaissance
with a wholly-owned subsidiary of Household International, Inc. called
Renaissance Credit Services, Inc.

. the adoption of the Renaissance Incentive Compensation Plan and certain
payments to be made under this plan, and

. of the issuance of shares of Renaissance common stock and the payment of
additional cash consideration to certain Renaissance option holders in
exchange for their agreement to cancel the options in connection with the
merger.

If we complete the merger, you will receive either common stock of Household
(which is traded on the New York Stock Exchange under the symbol "HI"), cash or
a combination of both for your Renaissance shares. The closing price of the
Household common stock on the NYSE on December 27, 1999 was $36.875. The amount
of stock and cash you receive will depend on a number of factors, which we
describe at pages 13 through 17 of the enclosed Prospectus and Proxy Statement.
You may receive from 0.7231 to 0.7512 shares of Household common stock for each
share of Renaissance common stock if you elect to receive only stock, or up to
$31.456 in cash, without interest, if you elect to receive only cash. If the
merger were completed today and you elected to receive a combination of stock
and cash, we estimate that you would receive for each Renaissance share 0.595
shares of Household common stock (worth $21.94 at the closing price on December
27, 1999) and $6.54 in cash.

After careful consideration, your Board of Directors has unanimously
determined that the agreement and plan of merger, and the transactions
contemplated by the agreement and plan of merger, including the merger, are in
the best interests of Renaissance and its shareholders, has adopted the
agreement and plan of merger and unanimously recommends that Renaissance
shareholders vote to approve the agreement and plan of merger, to adopt the
incentive compensation plan and approve certain payments to be made under this
plan, and to approve the issuance of shares of Renaissance common stock and the
payment of additional cash consideration to certain option holders, all as
described in these materials.

We describe the terms and conditions of the merger and the other proposals in
the accompanying Prospectus and Proxy Statement. I urge you to read the
enclosed materials carefully for a complete description of the merger and the
other proposals.

Sincerely,

Irving J. Levin
Chief Executive Officer

See "Risk Factors" on page 9 for a discussion of risks relevant to the
merger.

Neither the Securities and Exchange Commission nor
any other regulatory body has approved or
disapproved these securities or determined if this
Prospectus and Proxy Statement is accurate or
adequate. Any representation to the contrary is a
criminal offense.

This Prospectus and Proxy Statement is dated December 28, 1999 and is first
being mailed to Renaissance shareholders on or about December 31, 1999.
<PAGE>

Renaissance Holdings, Inc.

Notice of Special Meeting of
Shareholders to be Held
On February 1, 2000

To the Shareholders of Renaissance Holdings, Inc.:

You are invited to a special meeting of shareholders of Renaissance to be
held on February 1, 2000 at 9:30 a.m. at the offices of Renaissance Holdings,
Inc. located at 9400 SW Beaverton-Hillsdale Hwy., Beaverton, Oregon 97005. The
special meeting is for the following purposes:

1. To consider and vote upon a proposal to approve the Agreement and
Plan of Merger dated as of November 30, 1999 by and among Household
International, Inc., a wholly-owned subsidiary of Household called
Renaissance Credit Services, Inc., and Renaissance pursuant to which
Renaissance will be merged with Renaissance Credit Services, with the
surviving corporation continuing as a subsidiary of Household;

2. To consider and vote on a proposal to adopt the Renaissance Incentive
Compensation Plan and to approve certain payments to be made under this
plan;

3. To consider and vote upon a proposal to approve the issuance of
shares of Renaissance common stock and the payment of additional cash
consideration to certain holders of options granted by Renaissance that are
cancelled in connection with the agreement and plan of merger; and

4. To transact such other business as may properly come before the
meeting or any adjournment or postponement of the meeting.

Only shareholders of record at the close of business on December 31, 1999
are entitled to notice of and to vote at the meeting.

We urge you to read the accompanying Prospectus and Proxy Statement
carefully for a description of the merger and the other proposals.

You have the right to dissent from the merger under Oregon law and receive
payment of the "fair value" of your shares if you comply with certain
requirements of Oregon law described in the accompanying Prospectus and Proxy
Statement. See "The Merger--Dissenters' Rights of Renaissance Shareholders."

After careful consideration, your Board of Directors has unanimously
determined that the agreement and plan of merger, and the transactions
contemplated thereby, including the merger, are in the best interest of both
you and your company. Your Board has unanimously adopted the agreement and plan
of merger and unanimously recommends that you vote "for" approval of the
agreement and plan of merger, "for" the adoption of the incentive plan and
approval of certain payments to be made under this plan, and "for" the approval
of the issuance of shares of Renaissance common stock and the payments to
certain option holders who have had their options cancelled in connection with
the merger, all as described in the Prospectus and Proxy Statement.

Your vote is important regardless of the number of shares you own. Whether
or not you plan to attend the meeting, PLEASE MARK, DATE AND SIGN THE ENCLOSED
PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED STAMPED ENVELOPE. PLEASE DO
NOT SEND IN YOUR STOCK CERTIFICATES AT THIS TIME.

Beaverton, Oregon
December 28, 1999
<PAGE>

Table of Contents

<TABLE>
<CAPTION>
Page
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<S> <C>
Questions and Answers About the Merger.................................... 1
Summary................................................................... 3
The Companies........................................................... 3
The Merger.............................................................. 3
Special Meeting......................................................... 4
Recommendations of Renaissance Board to its Shareholders................ 4
Voting Rights and Vote Required......................................... 4
Dissenters' Rights...................................................... 4
Regulatory Approvals.................................................... 5
Market Price of Household Common Stock.................................. 5
Fairness Opinion of Renaissance Financial Advisor....................... 5
Accounting Treatment.................................................... 5
Listing of Household Common Stock....................................... 5
Conditions to the Merger................................................ 5
Termination of the Merger Agreement..................................... 6
Termination Fees........................................................ 6
Forward-Looking Statements May Prove Inaccurate......................... 6
Comparison of the Rights of Renaissance Shareholders and Household
Common Stockholders.................................................... 6
Selected Financial Data................................................. 7
Comparative Per Share Data.............................................. 8
Risk Factors.............................................................. 9
Forward-Looking Statements................................................ 10
The Special Meeting of Renaissance Shareholders........................... 10
Date, Time and Place.................................................... 10
Purpose................................................................. 10
Record Date; Quorum; Voting Procedures and Vote Required................ 10
Voting Agreements....................................................... 11
Proxies................................................................. 11
Solicitation of Proxies, Expenses....................................... 12
Action and Recommendation of Renaissance Board of Directors............. 12
Market and Trading Information............................................ 12
The Merger................................................................ 13
General................................................................. 13
Stock and Cash Election................................................. 14
All Stock Election...................................................... 14
Pro-rationing of All Stock or All Cash Elections........................ 16
Required Vote; Merger Date.............................................. 17
All Cash Merger......................................................... 17
Conduct of Business Pending the Merger.................................. 17
Operations After the Merger............................................. 17
Effect of the Merger on Renaissance Employee Benefit Plans and Options.. 17
Interest of Certain Persons in the Merger............................... 18
Resales by Affiliates................................................... 21
Background of the Merger; Renaissance's Reasons for the Merger.......... 21
Recommendation of Renaissance's Board of Directors on Merger............ 23
Material Contacts and Board Deliberations............................... 23
Opinion of Renaissance's Financial Advisor.............................. 25
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
Page
----
<S> <C>
Household International's Reasons for the Merger........................ 28
Conditions to the Merger; Amendment; Termination........................ 28
Certain Federal Income Tax Consequences................................. 29
Conversion of Shares and Exchange of Certificates....................... 34
Fractional Shares....................................................... 34
Accounting Treatment.................................................... 35
Required Regulatory Approvals........................................... 35
Transfer and Exchange Agents............................................ 35
Dissenters' Rights of Renaissance Shareholders.......................... 35
Renaissance Incentive Compensation Plan................................... 37
Cash Payments and Renaissance Common Stock Issued to Holders of
Compensatory Options..................................................... 40
Household................................................................. 41
Description of Household................................................ 41
Selected Financial Data................................................. 41
Description of Household Capital Stock.................................... 45
General................................................................. 45
Preferred Stock......................................................... 45
Description of Each Authorized Series of Preferred Stock................ 46
Common Stock............................................................ 49
Preferred Share Purchase Rights......................................... 50
Dividends............................................................... 50
Special Charter Provisions.............................................. 50
Description of Renaissance................................................ 51
General................................................................. 51
Common Stock............................................................ 51
Selected Financial Data................................................. 52
Management's Discussion and Analysis of Financial Condition and Results
of Operations.......................................................... 54
Management of Renaissance............................................... 66
Executive Compensation.................................................. 67
Principal Shareholders of Renaissance................................... 71
Comparison of Rights of Renaissance Shareholders and Household
Stockholders............................................................. 72
Legal Matters............................................................. 74
Experts................................................................... 74
Additional Information--Where You Can Find More Information............... 75
Consolidated Financial Statements of Renaissance.......................... F-1
Annex A--Agreement and Plan of Merger..................................... A-1
Annex B--Fairness Opinion of Renaissance's Financial Advisor.............. B-1
Annex C--Renaissance Incentive Compensation Plan.......................... C-1
Annex D--Oregon Dissenters' Rights Statutes............................... D-1
</TABLE>

The Securities and Exchange Commission allows Household to "incorporate by
reference" information into this Prospectus and Proxy Statement, which means
that Household can disclose important information to you by referring you to
another document filed separately with the Securities and Exchange Commission.
This Prospectus and Proxy Statement incorporates by reference important
business and financial information about Household which is deemed to be part
of this Prospectus and Proxy Statement even though it is not included in or
delivered with this Prospectus and Proxy Statement. See "Additional
Information--Where You Can Find More Information".

You can obtain any of the documents incorporated by reference in this
Prospectus and Proxy Statement from Household or from the Securities and
Exchange Commission's web site at http://www.sec.gov. The documents are
available from Household without charge, excluding any exhibits
<PAGE>

to those documents unless the exhibit is specifically incorporated by reference
in this Prospectus and Proxy Statement. You should request these documents in
writing, by phone or e-mail from:

Darcie Oakes
Office of the Secretary
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Telephone: (847) 564-7580
email: [email protected]

If you want these documents, please request them by January 25, 2000 to
receive them before the special meeting. Please be sure to include your
complete name and address in your request. If you request any documents
incorporated by reference, Household will mail them to you by first class mail
within one business day after it receives your request.
<PAGE>

QUESTIONS AND ANSWERS ABOUT THE MERGER

Q: Why does Renaissance want to merge?

A: Renaissance is proposing to merge because we believe our combination with
Household will provide our shareholders with substantial benefits and will
enable us to better serve our clients. We believe that with Household we can
create a strong non-prime credit card issuer that is able to effectively
compete with larger non-prime credit card issuers like Capital One,
Providian and Metris. With our management expertise and Household's access
to customers and funding sources, we hope to be able to aggressively grow
our business more rapidly than we have in the past. To review the background
and reasons for the merger in greater detail, as well as the risks of the
merger, see pages 9 and 21 through 24.

Q: Who is Household International?

A: Household is a Fortune 500 public company listed on the NYSE that has been
making loans to the non-prime market since 1878. It has operations in
consumer finance, auto lending, credit cards, private-label credit cards and
credit and specialty insurance. It has businesses throughout the United
States, Canada and the United Kingdom.

Q: What will I receive in the merger?

A: If the merger is approved, you will have the right to elect to receive:

.Cash in the amount of $31.456 for each share of Renaissance common
stock; or

.A fraction of a share of Household common stock with an implied value
of $31.456 for each share of Renaissance common stock; or

.A combination of cash and a fraction of a share of Household common
stock that totals an implied value of $31.456 for each share of
Renaissance common stock.

The amount of cash and shares you receive will depend on your election and
may depend on the elections of other shareholders because the total amount
of cash and shares Household will provide is limited.

If you receive shares of Household you will not receive any fractional
shares. Instead, you will receive cash, without interest, for any
fractional share of Household common stock owed to you based on the implied
value of Household common stock.

For example: If you own 100 shares of Renaissance common stock and elect to
receive solely Household common stock that has a
20-day trading value of $41.875, the stock election exchange ratio would be
set at .7512 and you would receive 75 shares of Household common stock and
cash of $5.03 for the fractional share (.12 share of Household common stock
multiplied by the $41.875).

If the trading value for a share of Household common stock on the merger
date is less than $28.00 per share, then Household will pay only cash in
the amount of $31.456 for each share of Renaissance common stock regardless
of your election.

Q: What is the "trading value" for a share of Household common stock?

A: The trading value for a share of Household common stock is the average of
the high and low sales prices per share of Household common stock on the
NYSE for that day.

For example: On December 20, 1999 the high sales price for Household common
stock was $38.375 and the low sales price was $37.75. The trading value for
that day was $38.063 ($37.75 plus $38.375 divided by 2).

Q: What do I need to do now?

A: Just indicate on your proxy card how you want to vote for each of the
proposals and sign and mail it in the enclosed return envelope as soon as
possible. Your shares will then be represented at your shareholders'
meeting. If you sign and send in your proxy and do not indicate how you want
to vote for each of the proposals, your proxy will be counted as a vote in
favor of the merger and the other proposals at this meeting. If you do not
vote or you abstain, it will have the same effect as a vote against the
merger and the other proposals at this meeting.
<PAGE>

Q: Should I send in my stock certificates now?

A: No. After the merger is completed we will send you a Letter of Transmittal
with written instructions for making your election and exchanging share
certificates.

Q: Why will I receive shares of Household International? Can't I keep my
shares of Renaissance?

A: Renaissance will be merged with Renaissance Credit Services, Inc. Your only
interest in Renaissance after the merger will be to receive the
consideration for the merger. You will not be able to continue as a direct
shareholder of Renaissance.

Q: If I elect Household common stock, will I receive future dividends?

A: Household has paid a quarterly dividend to its common stockholders every
quarter for the past 73 years. Although we currently expect to continue to
pay such dividends, we cannot assure you of such payments. Household's
Board of Directors will use its discretion to decide whether to declare
dividends and the amount of any dividends. In making its decision, the
Board will consider various factors, including the earnings and financial
condition of Household.

Q: When do you expect the merger to be completed?

A: We are working toward completing the merger as quickly as possible. In
addition to shareholder approvals, we must also obtain regulatory
approvals. We hope to complete the merger as early as the beginning of
February 2000.

Q: What are the tax consequences of the merger to me?

A: If you elect to receive Household common stock only, the exchange of shares
by you will be tax-free to you for federal income tax purposes. However,
you will have to pay taxes on any cash received for fractional shares.

If you elect to receive any cash, or are paid cash by Household for
fractional shares or because your election was adjusted as a result of the
elections made by the other shareholders of Renaissance, or because the
actual per share trading value as of the merger date for Household common
stock is less than $28.00, you will have to pay income taxes. To review the
tax consequences in greater detail, see pages 29 through 34.

Tax matters are very complicated and the tax consequences of the merger to
you will depend on the facts of your own situation. You should consult your
tax advisors for a full understanding of the tax consequences of the merger
to you.

Who Can Help Answer Your Questions

If you have more questions about the merger you should contact:

Renaissance Holdings, Inc.
9400 SW Beaverton-Hillsdale Hwy.
Suite 300
Beaverton, Oregon 97005
Attn: Charles Engelberg
(503) 469-6900

If you would like additional copies of this Prospectus and Proxy Statement or
copies of the Letter of Transmittal (which will be your election form) you
should contact:

Household International, Inc.
Office of the Secretary
2700 Sanders Road
Prospect Heights, Illinois 60070
Attn: Darcie Oakes
(847) 564-7580
2
<PAGE>

SUMMARY

This summary highlights selected information from this document and does not
contain all of the information that is important to you. To understand the
merger fully, and for a more complete description of the legal terms of the
merger, you should read carefully this entire document and the documents to
which we have referred you. See "Additional Information--Where You Can Find
More Information" (page 75). We have included page references parenthetically
to direct you to a more complete description of the topics presented in this
Summary. We encourage you to read the agreement and plan of merger carefully as
it is the legal document that governs the merger.

The Companies

Renaissance (page 51)

Renaissance Holdings, Inc.
9400 SW Beaverton-Hillsdale Hwy.
Suite 300
Beaverton, Oregon 97005
(503) 245-5595

Renaissance's principal business focuses on the subprime credit card market.
Renaissance is an issuer and servicer of subprime credit card accounts.

Renaissance was incorporated in Oregon in 1992 under the name "TL Holdings,
Inc."

Renaissance Credit Services

Renaissance Credit Services, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
(847) 564-6150

Renaissance Credit Services is a Delaware corporation and a wholly-owned
subsidiary of Household. Renaissance Credit Services was incorporated on July
6, 1999 by Household for the purpose of acquiring businesses involved in
consumer lending.

Household (page 41)

Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
(847) 564-5000

Household, through its subsidiaries, primarily provides consumers with
several types of loan products in the United States, Canada and the United
Kingdom. We offer home equity loans, VISA* and MasterCard* and private-label
credit cards, auto finance loans, tax refund anticipation loans and other types
of unsecured loans. Household Finance Corporation, a subsidiary of Household,
is the oldest consumer finance company in the United States, with operations
dating back to 1878. At September 30, 1999, Household had $67.8 billion in
managed (owned and serviced with limited recourse) receivables and $49.3
billion in owned receivables.

*VISA and MasterCard are registered trademarks of VISA USA, Inc. and
MasterCard International, Incorporated, respectively.

The Merger (page 13)

If the agreement and plan of merger, which is attached to this Prospectus
and Proxy Statement as Annex A, is approved by the holders of a majority of
each class of Renaissance common stock and if all other conditions are
satisfied, Renaissance will be merged with Renaissance Credit Services no later
than the first business day after satisfaction of all conditions. Following
completion of the merger, the surviving corporation will be a wholly-owned
subsidiary of Household.

Each share of Renaissance common stock, except for those shares as to which
dissenters' rights are perfected in accordance with applicable laws, will be
converted into consideration valued at $31.456 per share. No interest will be
paid on any component of this consideration.

Completion of the merger is subject to the satisfaction or waiver of various
conditions, including compliance by each party with its covenants and the
accuracy of each party's representations and warranties. Under certain
conditions the agreement and plan of merger may be terminated by either party.

3
<PAGE>

Special Meeting (page 10)

The Renaissance special meeting of shareholders will be held at its offices
at 9400 SW Beaverton-Hillsdale Hwy., Suite 300, Beaverton, Oregon 97005 at 9:30
a.m. on February 1, 2000. At the special meeting, you will be asked to approve
the agreement and plan of merger, adopt the Renaissance Incentive Compensation
Plan and approve certain payments to be made under this plan, and approve the
issuance of shares of Renaissance common stock and the payment of additional
cash consideration to certain holders of options granted by Renaissance which
are cancelled in connection with the merger.

Recommendations of Renaissance Board to its Shareholders (page 12)

The Renaissance Board believes that the merger is in your best interest and
unanimously recommends that you vote "for" the proposal to approve the
agreement and plan of merger. The Renaissance Board also unanimously recommends
that you vote "for" the proposal to adopt the Renaissance Incentive
Compensation Plan and approve certain payments to be made under this plan, and
"for" the proposal to approve the issuance of shares of Renaissance common
stock and the payment of additional cash consideration to certain holders of
options granted by Renaissance which are cancelled in connection with the
merger.

Holders representing approximately 84% of the outstanding shares of
Renaissance common stock and a majority of all three classes of common stock
have agreed with Household to vote to approve the agreement and plan of merger.
In addition, certain directors, shareholders and management members of
Renaissance have interests in the merger in addition to any interests they may
have as a shareholder of Renaissance generally. The Board of Directors of
Renaissance was aware of the voting agreements and the interests of all such
persons at the time it approved, and recommended to its shareholders the
approval of, the agreement and the transactions to be completed in connection
with the merger.

Voting Rights and Vote Required (page 10)

All holders of Renaissance common stock as of December 31, 1999 are entitled
to vote at the special meeting of Renaissance shareholders. Oregon law requires
that holders of not less than a majority of the outstanding shares of each of
the three classes of Renaissance common stock entitled to vote must approve the
agreement and plan of merger in order for the transaction to be approved. To
adopt the Renaissance Incentive Compensation Plan and approve certain payments
to be made under this plan, and to approve the issuance of shares of
Renaissance common stock and the payment of additional cash consideration to
certain holders of options granted by Renaissance which are cancelled in
connection with the merger, holders of not less than 75% of Renaissance's
common stock able to vote and who are disinterested with respect to this plan
or payments (as determined by the rules of the IRS), must vote for such
proposals.

Approval of the Renaissance Incentive Compensation Plan and of certain
payments to be made under this plan and approval of the issuance of Renaissance
common stock and the payment of cash to certain holders of options that will be
cancelled in connection with the merger, will have no impact on the
consideration to be received by Renaissance shareholders as a result of the
merger.

If shareholder approval for the agreement and plan of merger is not obtained
at the special meeting, the proposals relating to the incentive plan and the
issuance of stock to certain holders of options will be withdrawn. However, the
shareholders may approve the agreement and plan of merger and not the other
proposals.

Renaissance expects, based upon voting agreements, that senior management
and holders of Renaissance common stock representing approximately 84% of the
outstanding shares and a majority of all three classes of common stock will
vote in favor of the merger. It is not necessary for the stockholders of
Household to approve the transaction.

Dissenters' Rights (page 35)

You may demand dissenters' rights in accordance with the Oregon Business
Corporation Act. To perfect any right of appraisal you must, prior to any
shareholder vote on the merger, deliver a written demand for payment of the
"fair value" of

4
<PAGE>

your shares to Renaissance. In addition, if you demand an appraisal you must
not vote in favor of the merger. If you demand dissenters' rights, your shares
will not be converted but will only be entitled to such rights and
considerations as may be allowed by the law. A copy of Sections 60.551 to
60.594 of the Oregon Business Corporation Act is attached as Annex D to this
Prospectus and Proxy Statement.

Regulatory Approvals (page 35)

In order for the proposed transaction to be completed, approval must be
obtained from

. the United States Federal Trade Commission pursuant to the Hart-Scott-
Rodino Antitrust Improvement Act,

. the United States Department of Justice pursuant to the Hart-Scott-Rodino
Act, and

. the Office of Thrift Supervision under the Bank Merger Act.

We anticipate that such federal agencies will approve the merger, but no
assurance can be given that such approval will be obtained.

Market Price of Household Common Stock (page 12)

Household common stock is listed on the NYSE and the Chicago Stock Exchange
(symbol: HI). As of December 20, 1999, there were 467,879,375 shares of
Household common stock issued and outstanding. The reported closing sale price
of the Household common stock on the NYSE on December 27, 1999 was $36.875 per
share. You should obtain current market quotations prior to the special
meeting.

Fairness Opinion of Renaissance Financial Advisor (page 25)

In deciding to approve and adopt the agreement and plan of merger,
Renaissance's Board considered the opinion of William Blair & Company, L.L.C.,
its financial advisor, as to the fairness of the merger to its shareholders
from a financial point of view. This opinion is attached as Annex B to this
Prospectus and Proxy Statement. We encourage you to read this opinion
carefully.

Accounting Treatment (page 35)

Household expects to account for the acquisition of Renaissance as a
purchase under generally accepted accounting principles.

Listing of Household Common Stock

The Household common stock to be issued in connection with the merger is
listed on the New York Stock Exchange. If we complete the merger, as long as
you did not consent to transfer restrictions, you will be able to immediately
trade the shares of Household common stock you receive.

Conditions to the Merger (page 28)

We will complete the merger only if we satisfy or (in some cases) waive
several conditions, including the following:

. a majority of each class of the common stock of Renaissance approve the
merger agreement;

. no legal restraints or prohibitions exist which prevent the consummation
of the merger or are reasonably likely to have a material adverse effect
on Renaissance or Household;

. all representations and warranties of Renaissance, Household and
Renaissance Credit Services shall be true and accurate, and such parties
shall have complied, in all material respects, with all covenants and
agreements required by the agreement and plan of merger; and

. legal opinions in respect of certain legal matters and federal income tax
consequences of the merger shall have been delivered, unless, with
respect to federal income tax matters, only cash is paid by Household in
connection with the merger.

5
<PAGE>

Termination of the Merger Agreement (page 28)

The agreement and plan of merger can be terminated at any time without
completing the merger if agreed to by Household and Renaissance. Either
Household or Renaissance can terminate the agreement and plan of merger if:

. we do not complete the merger by May 31, 2000;

. a majority of each class of the shareholders of Renaissance do not
approve the agreement and plan of merger;

. a governmental authority or other legal action permanently prohibits the
merger; or

. the other party breaches any of the representations or warranties it made
under the agreement and plan of merger, which breach has not been cured
after notice.

In addition, Renaissance's Board may terminate the agreement and plan of
merger if it receives a proposal from a third party to acquire a majority of
its voting stock or a substantial portion of its assets on terms it determines
are more favorable to its shareholders than the merger, and Renaissance enters
into an agreement with that third party for that purpose.

Termination Fees (page 29)

If Renaissance receives a takeover proposal and it then terminates the
agreement and plan of merger, it must pay to Household a termination fee of $7
million and up to $1 million to reimburse Household for its merger-related
expenses. In addition, if the agreement and plan of merger is not approved by
the shareholders of Renaissance, Renaissance must pay Household the same
termination fee and expense reimbursement.

Forward-Looking Statements May Prove Inaccurate (page 10)

We have each made forward-looking statements in this document (including
documents of Household that are incorporated by reference) that are subject to
risks and uncertainties. Forward-looking statements include the information
concerning possible or assumed future results of operations of Renaissance and
Household. Also, when we use words such as "believes", "expects", "anticipates"
or similar expressions, we are making forward-looking statements. Shareholders
should note that many factors, some of which are discussed elsewhere in this
document and in the documents which are incorporated by reference, could affect
the future financial results of Renaissance and Household and could cause those
results to differ materially from those expressed in our forward-looking
statements contained or incorporated by reference in this document. These
factors include the following:

. operating, legal and regulatory risks;

. economic, political and competitive forces affecting the businesses of
Renaissance and Household; and

. the risk that our analyses of these risks and forces could be incorrect
and/or that the strategies developed to address them could be unsuccessful.

Comparison of the Rights of Renaissance Shareholders and Household Common
Stockholders (page 72)

In the merger you may receive shares of Household common stock. There are
numerous differences between the rights of a shareholder in Renaissance, a
private Oregon corporation, and the rights of a stockholder in Household, a
publicly traded Delaware corporation.

6
<PAGE>

Selected Financial Data

The following table presents on a historical basis selected consolidated
financial data for Renaissance and Household, for the nine months ended
September 30, 1999 and 1998 and for each of the years in the five years ended
December 31, 1998. This financial data is based on the consolidated financial
statements of Renaissance and Household, which are either incorporated by
reference or included in this Prospectus and Proxy Statement.

<TABLE>
<CAPTION>
At or For the Nine
Months Ended
September 30, At or For the Year Ended December 31,
------------------ --------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
--------- -------- -------- -------- --------- --------- --------
(In millions, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Total income before
taxes:
Renaissance........... $ 18.4 $ 6.0 $ 8.1 $ (0.1) $ 1.8 $ 3.6 $ 3.4
Household
International........ 1,562.9 428.2(1) 952.7(1) 1,402.5 1,280.8 1,024.1 854.4
Net income:
Renaissance........... 10.9 3.6 4.9 0.4 1.4 3.2 3.0
Household
International........ 1,047.6 174.2(1) 524.1(1) 940.3 819.6 603.7 545.3
Diluted earnings per
common share:
Renaissance........... 1.12 0.45 0.61 0.05 0.22 0.55 0.52
Household
International........ 2.15 0.32(1) 1.03(1) 1.93 1.73 1.24 1.13
Historical cash
dividends declared per
common share:
Renaissance........... -- -- -- 0.04 0.04 0.26 0.35
Household
International........ 0.51 0.45 0.60 0.54 0.49 0.44 0.41
Total assets--owned
(end of period):
Renaissance........... 395.0 189.8 242.8 152.7 102.1 63.0 47.4
Household
International........ 57,585.5 51,452.2 52,892.7 46,817.0 45,332.0 44,723.0 48,527.1
Total assets--managed
(end of period):(2)
Renaissance........... 497.8 281.6 335.0 210.7 149.9 135.7 112.3
Household
International........ 76,050.1 73,258.3 72,594.6 71,295.5 66,183.2 60,721.1 61,652.6
Total shareholders'
equity
(end of period):
Renaissance........... 25.8 12.8 14.4 9.2 6.9 4.3 3.3
Household
International........ 6,779.4 6,585.0 6,760.8 6,613.5 5,016.0 4,473.9 3,920.7(3)
</TABLE>
- --------
(1) Our operating income before taxes, operating net income, and diluted
operating earnings per share exclude merger and integration related costs
of $751.0 million after-tax related to the merger with Beneficial and the
gain on sale of Beneficial Canada of $118.5 million after-tax. For the nine
months ended September 30, 1998 total operating income before taxes was
$1,238.8 million, operating net income was $806.7 million and diluted
operating earnings per share was $1.59. For 1998 total operating income
before taxes was $1,763.3 million, operating net income was $1,156.6
million and operating earnings per share was $2.30.
(2) Total assets--managed represents owned assets and the outstanding balance
of receivables serviced with limited recourse.
(3) Excludes convertible preferred stock that was fully converted or redeemed
during 1995.

7
<PAGE>

Comparative Per Share Data

The following table sets forth historical per common share diluted earnings,
cash dividends, book value and market value of: (1) Household and (2)
Renaissance and pro forma equivalent per common share data of Renaissance,
calculated by multiplying historical per share data of Household by the
exchange ratio assuming (1) an implied market value of $31.456 for Household
common stock for the merger consideration, and (ii) Household common stock
price equal to $41.875 per share (the set trading value for Household common
stock when the 20-day trading value for a share of Household common stock is
below $41.875). The information set forth below should be read in conjunction
with the selected historical financial data included elsewhere in the
Prospectus and Proxy Statement.

<TABLE>
<CAPTION>
Household Pro forma
International Renaissance Equivalent
------------- ----------- ----------
<S> <C> <C> <C>
Diluted earnings per common share:
Year ended December 31, 1998........ $ 1.03 (1) $0.61 $ 0.77
Nine months ended September 30,
1999............................... 2.15 1.12 1.62
Cash dividends per common share:
Year ended December 31, 1998........ 0.60 -- 0.45
Nine months ended September 30,
1999............................... 0.51 -- 0.38
Book value per common share as of:
December 31, 1998................... 12.88 2.28 9.68
September 30, 1999.................. 13.26 3.99 9.96
Market value per common share as of
December 1, 1999(2).................. 38/41///64/ (3) -- 29.03
Minimum market value per common share
as of December 27, 1999.............. 41.875 (4) -- 31.46
Market value per common share as of
December 27, 1999.................... 36 7/8 (3) -- 27.70
</TABLE>
- --------
(1) Diluted operating earnings per common share excluding merger and
integration related costs and the gain on sale of Beneficial Canada of
$751.0 and $118.5 million after-tax, respectively, was $2.30.
(2) The trading day on the NYSE immediately preceding public announcement of
the execution of the agreement and plan of merger.
(3) Based on the closing price of Household common stock as reported on the
NYSE.
(4) The 20-day-trading value for a share of Household common stock with
December 27, 1999 being the final trading day.

8
<PAGE>

RISK FACTORS

In addition to the other information included or incorporated by reference
in this Prospectus and Proxy Statement, you should carefully consider the
following risk factors.

You may receive Shares of Household Common Stock having a value that is less
than its implied value.

If you receive Household common stock it will have an implied value based on
a 20-day trading value for such stock. In addition, if the 20-day trading value
for a share of Household common stock is below $41.875 that trading value will
be set at $41.875. As a result, if on the date you receive the Household common
stock the actual market value for such stock is less than the implied value
given to the stock you will receive actual consideration for your shares of
Renaissance common stock that will be less than $31.456 per share. Even if you
elect only cash for the exchange of your shares, you may receive shares of
Household common stock as a result of too many Renaissance shareholders making
the same election.

The integration of Renaissance with Household may be difficult and expensive
to achieve and may not result in the benefits currently anticipated by
Household.

The merger will present challenges to management, including the integration
of the operations, technologies and personnel of Renaissance and Household, and
special risks, including possible unanticipated liabilities, unanticipated
costs, diversion of management attention and loss of personnel.

Household may not be able to integrate successfully or manage profitability
Renaissance's businesses. Following the merger, Renaissance's businesses may
not achieve sales levels, profitability or cost savings that justify the
investment made by Household. The acquisition, while expected to be accretive
to earnings in future periods, may fail to be accretive or earnings accretion
may occur later than planned.

Any cash you receive in connection with the exchange of your Shares will be
taxable.

You may incur federal and state income taxes on the cash portion of any
merger consideration you receive. If the trading value of Household common
stock on the merger date is less than $28.00 per share, each share of
Renaissance common stock will only be converted into the right to receive cash.
In addition, if you elect to receive only Household common stock you may be
paid some cash if too many Renaissance shareholders make the same election. Tax
matters are very complicated and will depend on the facts of your own
situation. You should consult your tax advisor for a full understanding of the
tax consequences of the merger to you.

The price of Household Common Stock may be affected by factors different
from those affecting Renaissance Common Stock.

You may become a holder of Household common stock as a result of the merger.
Household's businesses differ from those of Renaissance. Household's results of
operations, as well as the price of its common stock, may be affected by
factors different from those which affect Renaissance's results of operations.

Certain directors, shareholders and officers of Renaissance have interests
that may be different than yours with respect to the merger and the other
proposals to be voted on at the special meeting.

You should be aware that there are many transactions that will occur in
connection with the merger. Some of these transactions provide benefits to
directors, shareholders and officers of Renaissance that are in addition to
those benefits they would receive as a shareholder of Renaissance generally.
The Renaissance Board of Directors was aware of these interests prior to taking
any vote on the agreement and plan of merger and the transactions related to
that agreement. You should review these interests carefully before making your
decision with respect to the proposals at the special meeting.

9
<PAGE>

FORWARD-LOOKING STATEMENTS

This Prospectus and Proxy Statement, including information incorporated by
reference, contains certain forward-looking statements with respect to the
financial condition, results of operations, plans, objectives, future
performance and business of each of Household and Renaissance, as well as
certain information relating to the merger. Forward-looking statements include
statements preceded by, followed by, or that include the words "believes,"
"expects," "anticipates," "estimates" or similar expressions. The forward-
looking statements involve certain risks and uncertainties. For those
statements, Household and Renaissance claim the protection of the safe harbor
for forward-looking statements contained in the Private Securities Litigation
Reform Act of 1995. Actual results may differ materially from those
contemplated by such forward-looking statements due to, among others, the
factors described under "Risk Factors" and the following factors:

. general economic, financial or business conditions, either
internationally, nationally or in the states in which Household or
Renaissance is doing business that may be less favorable than expected;

. demand for the lending products offered by Household and Renaissance, as
well as their customer's repayment habits, may not track historical
performance;

. legislative or regulatory changes that may adversely affect the
businesses in which Household and Renaissance are engaged;

. technological changes, including "Year 2000" data systems compliance
issues, that may be more difficult or expensive than anticipated; and

. changes that may occur in the securities markets.

A more detailed list of factors relating to Household is set forth in
Household's Form 10-K for the year ended December 31, 1998. See "Additional
Information--Where You Can Find More Information".

THE SPECIAL MEETING OF THE RENAISSANCE SHAREHOLDERS

Date, Time and Place

This Prospectus and Proxy Statement is being furnished to the holders of all
of Renaissance's common stock (including the Class B and Class C common stock)
in connection with the solicitation of proxies by the Board of Directors of
Renaissance to be voted at a special meeting of shareholders to be held on
February 1, 2000, at 9:30 a.m. at the offices of Renaissance located at 9400 SW
Beaverton-Hillsdale Hwy., Suite 300, Beaverton, Oregon 97005.

Purpose

At the special meeting the holders of Renaissance common stock will vote on
a proposal to approve the agreement and plan of merger, to adopt the
Renaissance Incentive Compensation Plan and approve certain payments to be made
under this plan, to approve the issuance of Renaissance common stock and the
payment of additional cash consideration to certain holders of options granted
by Renaissance that are cancelled in connection with the merger, and to
consider and transact such other business as may properly be brought before the
special meeting.

Record Date; Quorum; Voting Procedures and Vote Required

The Board of Directors of Renaissance has fixed the close of business on
December 31, 1999 as the record date for determination of shareholders entitled
to notice of and to vote at the special meeting. It is expected that as of the
record date, 7,693,111 shares of Renaissance common stock, 317,314 shares of
Renaissance Class B common stock and 299,078 shares of Renaissance Class C
common stock will be issued and outstanding. Each share of Renaissance Class C
common stock entitles its holder to one vote on the approval of the merger in
accordance with Oregon law. Each share of Renaissance common stock and
Renaissance Class B common

10
<PAGE>

stock entitles its holder to one vote on each matter submitted to the vote of
shareholders at the special meeting. The presence in person or by proxy of the
holders of a majority of the shares of Renaissance common stock outstanding is
required to constitute a quorum for the special meeting. Assuming a quorum is
present, approval of the agreement and plan of merger requires the affirmative
vote of holders of not less than a majority of the outstanding shares of (i)
Renaissance common stock, (ii) Renaissance Class B common stock, and (iii)
Renaissance Class C common stock, each voting as a separate class. Assuming a
quorum is present, the adoption of the Renaissance Incentive Compensation Plan
and approval of certain payments to be made thereunder, and the approval of the
issuance of Renaissance common stock and the payment of additional cash
consideration to certain holders of options granted by Renaissance that are
cancelled in connection with merger requires the affirmative vote of not less
than 75% of Renaissance's common stock that is able to vote and is
disinterested to these proposals as determined by the rules of the IRS.

Votes, whether in person or by proxy, will be counted and tabulated by
inspectors appointed by Renaissance. The inspectors will treat shares of
Renaissance common stock represented by a properly executed and returned proxy
as present at the special meeting for purposes of determining a quorum. An
abstention will have the same effect as a vote against the proposals.

If the required shareholder approval for the agreement and the plan of
merger is not obtained, the proposals relating to the Renaissance Incentive
Compensation Plan and the issuance of Renaissance common stock to holders of
options will be withdrawn. However, the shareholders may approve the agreement
and plan of merger and not the other proposals.

Voting Agreements

General Electric Capital Corporation, Irving J. Levin, George F. and Sharon
C. Alexander, Charles B. Engelberg, Karen D. and Fritz Frolich, William R.
Reesman, Patricia L. Reesman, The Patricia L. Reesman Family Limited
Partnership L.L.P., Neil Goldschmidt, Martin and Virginia Mitchell, Noel C.
Nelson and Ruth Scherbarth, who own approximately 84% of the outstanding
Renaissance common stock and 100% of Renaissance's Class B and Class C common
stock, have entered into agreements with Household that obligate them to vote
all shares of Renaissance common stock they hold in favor of the proposal to
approve the agreement and plan of merger.

Proxies

The form of proxy for use at the special meeting accompanies this Prospectus
and Proxy Statement. A shareholder may use a proxy whether or not he or she
intends to attend the special meeting. The proxy may be revoked in writing by
the person giving it at any time before it is exercised by notice to the
Secretary of Renaissance, by executing and submitting a later dated proxy or by
attending and voting in person at the special meeting. All proxies validly
submitted and not revoked will be voted in the manner specified herein. IF NO
SPECIFICATION IS MADE, THE PROXIES WILL BE VOTED FOR APPROVAL OF THE AGREEMENT
AND PLAN OF MERGER, FOR THE ADOPTION OF THE RENAISSANCE INCENTIVE COMPENSATION
PLAN AND APPROVAL OF CERTAIN PAYMENTS TO BE MADE UNDER SUCH PLAN, AND FOR THE
APPROVAL OF THE ISSUANCE OF SHARES OF RENAISSANCE COMMON STOCK AND PAYMENT OF
ADDITIONAL CASH CONSIDERATION TO CERTAIN HOLDERS OF OPTIONS GRANTED BY
RENAISSANCE THAT ARE TO BE CANCELLED IN CONNECTION WITH THE MERGER. The Board
of Directors of Renaissance is not aware of any other matters that may be
presented for action at the special meeting, but if other matters do properly
come before the meeting it is intended that the shares represented by the
accompanying proxy will be

11
<PAGE>

voted by the persons named in the proxy in accordance with the recommendation
of Renaissance's Board of Directors.

Solicitation of Proxies; Expenses

Solicitation of proxies will be made in person, by mail or by telephone,
facsimile or telegraph by present directors, officers and employees of
Renaissance for which no additional compensation will be paid. Household will
bear all costs of preparing and mailing this Prospectus and Proxy Statement,
not including the solicitation of the proxies relating to the special meeting,
which will be borne solely by Renaissance.

This Prospectus and Proxy Statement is being mailed on or about December 31,
1999 to all holders of Renaissance common stock on the record date.

Action and Recommendation of Renaissance Board of Directors

The Renaissance Board has unanimously approved and adopted the agreement and
plan of merger, approved the merger, adopted the Renaissance Incentive
Compensation Plan and approved payments to be made under this plan and approved
the issuance of Renaissance common stock and the payment of additional cash
consideration to certain holders of Renaissance options, which options are to
be cancelled in connection with the merger. The Renaissance Board unanimously
recommends a vote FOR approval of the agreement and plan of merger FOR the
adoption of the Renaissance Incentive Compensation Plan and approval of certain
payments to be made under this plan, and FOR approval of the issuance of
Renaissance common stock and the payment of additional cash consideration to
certain holders of Renaissance options, which options are to be cancelled in
connection with the merger.

MARKET AND TRADING INFORMATION

The Household common stock is listed on the New York Stock Exchange and the
Chicago Stock Exchange under the symbol "HI." The following table sets forth,
for the periods indicated, the high and low sale prices per share of Household
common stock on the NYSE, together with the dividends declared by Household per
share of Household common stock.

<TABLE>
<CAPTION>
Common
Stock Cash
Price Dividends
-------------- Declared
High Low Per Share
---- ---- ---------
<S> <C> <C> <C>
1997
- ----
First Quarter.................................. $36 5/64 $28 1/3 $.13
Second Quarter................................. 39 9/64 26 13/64 .13
Third Quarter.................................. 43 1/3 36 9/64 .14
Fourth Quarter................................. 43 7/32 36 1/8 .14
1998
- ----
First Quarter.................................. 47 51/64 37 45/64 .15
Second Quarter................................. 52 9/16 41 43/64 .15
Third Quarter.................................. 53 11/16 35 1/4 .15
Fourth Quarter................................. 40 1/2 23 .15
1999
- ----
First Quarter.................................. 46 11/16 38 11/16 .17
Second Quarter................................. 52 5/16 42 .17
Third Quarter.................................. 50 3/16 36 3/16 .17
Fourth Quarter (to December 27, 1999).......... 48 36 7/16 .17
</TABLE>

Household or its predecessor, Household Finance Corporation, has paid a
regular quarterly cash dividend on Household common stock since 1926. Household
increased its quarterly dividend by $.01 to $.15 per share,

12
<PAGE>

effective with the first quarter of 1998, and to $.17 per share effective with
the first quarter of 1999. Holders of Household common stock are entitled to
receive dividends from funds legally available therefor, when, as and if
declared by the Board of Directors of Household, subject to the prior rights of
holders of any shares of preferred stock of Household. See "Description of
Household Capital Stock."

There is no public market for the shares of Renaissance common stock.

The execution of the agreement and plan of merger was publicly announced on
December 2, 1999. The total book value of Renaissance as of September 30, 1999,
the closing price per share for Household common stock and the market value of
Household as of the close of business on December 1, 1999 (the last trading day
for Household common stock prior to the announcement) is set forth below:

<TABLE>
<CAPTION>
Household Renaissance
--------- -----------
<S> <C> <C>
Closing stock price per share.............. $ 38/41///64/ $ (NA)
Aggregate market value or book value
(amount in millions)...................... $18,078 $25.8
</TABLE>

The exchange ratios will not be fixed until one trading day (as defined
below) prior to the special meeting. Therefore, changes in the market price of
Household common stock may affect the fraction of Household common stock to be
received by the shareholders of Renaissance in the merger. Once the exchange
ratios are fixed, changes in the market price of Household common stock will
affect the dollar value of Household common stock to be received by the
shareholders of Renaissance in the merger. Following the date of the merger,
the value of Household common stock received by the former Renaissance
shareholders will be subject to market value fluctuations due to factors that
may differ from those that affected the Renaissance common stock. Renaissance
shareholders are urged to obtain current market quotations for Household common
stock prior to the special meeting.

THE MERGER

The information in this Prospectus and Proxy Statement concerning the terms
of the merger is a summary only and is qualified in its entirety by reference
to the agreement and plan of merger, which agreement is attached as Annex A
hereto and incorporated by reference into this Prospectus and Proxy Statement.

General

The agreement and plan of merger provides for the merger of Renaissance with
Renaissance Credit Services, Inc., a direct, wholly-owned subsidiary of
Household. With the exception of those shares as to which dissenters' rights
have been perfected in accordance with applicable laws, the outstanding shares
of Renaissance common stock will be converted into consideration with an
implied value of $31.456 per share of Renaissance common stock. You may elect
the form of the consideration, unless the trading value for a share of
Household common stock on the date of the merger is less than $28.00, in which
case the merger consideration will consist only of cash. No interest will be
paid on any component of the merger consideration. See "--Cash Merger" below.

Except as noted above and subject to the pro-rationing as described below,
you will be able to elect to exchange your shares of Renaissance common stock
for either:

(1) cash in the amount of $31.456 for each share of Renaissance common
stock; or

(2) a fractional interest in a share of Household common stock with an
implied value of $31.456 for each share of Renaissance common stock; or

(3) cash and a fractional interest in a share of Household common stock
that totals an implied value of $31.456 for each share of Renaissance
common stock.

13
<PAGE>

Stock and Cash Election

If you elect a combination of cash and Household common stock, the
fractional interest of a share of Household common stock to be exchanged for a
share of Renaissance common stock will be based upon an "exchange ratio." This
exchange ratio will be equal to 5,000,000 divided by the number of shares of
Renaissance common stock issued and outstanding on the date of the merger,
minus any dissenting shares; provided, however, that if the product of the
exchange ratio and the 20-day trading value for a share of Household common
stock is greater than $31.456, the exchange ratio shall be reduced so that the
product of the exchange ratio, as adjusted, and the 20-day trading value to
equal to $31.456. As of November 12, 1999, there were 6,475,811 shares of
Renaissance common stock issued and outstanding and options to purchase
2,573,177 shares were issued and outstanding. As a result of agreements entered
into in connection with the merger, we expect options will be exercised or
converted into 2.1 million shares of Renaissance common stock before the
merger. Accordingly, we expect the exchange ratio for persons electing both
stock and cash will be no greater than 5,000,000 divided by 8,400,000, or .595.
The exchange ratio will not be less than 5,000,000 divided by the total of all
shares and options currently outstanding, or .553.

The amount of cash you will receive per share of Renaissance common stock if
you make this election will be equal to the difference between $31.456 and the
implied value of the fraction of a share of Household common stock you receive.
The implied value of the shares of Household common stock you receive will be
equal to the exchange ratio times the 20-day trading value for a share of
Household common stock. The "20-day trading value" for a share of Household
common stock will be (i) the sum of the daily average high and low sales prices
per share of Household common stock on the NYSE as reported in The Wall Street
Journal (Midwest Edition) (and confirmed by William Blair & Company, L.L.C. and
Lehman Brothers) for each of the twenty consecutive trading days ending on the
trading day that is the trading day prior to the special meeting, (ii) divided
by twenty. In the event the 20-day trading value for a share of Household
common stock is (i) less than $41.875, then the implied value for such share
for purposes of the agreement and plan of merger shall be $41.875, and (ii)
greater than $43.50, then the implied value for such share for purposes of the
agreement and plan of merger shall be $43.50. A "trading day" shall be any day
on which the Household common stock is traded on the NYSE.

All Stock Election

If you elect to receive solely Household common stock, the fractional
interest of a share of Household common stock to be exchanged for a share of
Renaissance common stock will be based on the "stock election exchange ratio."
The stock election exchange ratio will be determined by dividing (x) $31.456 by
(y) the 20-day trading value for a share of Household common stock. This 20-day
trading value will be calculated in the same manner, with the same price
limitations, as set forth above. An increase or decrease in the market price of
Household common stock during the 20-day trading period will affect the stock
election exchange ratio.

14
<PAGE>

The following tables illustrate what the merger consideration would be under
different circumstances. The first table relates to an election to receive all
Household common stock, and the second table relates to an election to receive
a combination of cash and Household common stock. Both tables assume you will
receive an implied value of $31.456 for each share of Renaissance common stock.
The tables show some hypothetical examples of the 20-day trading value for a
share of Household common stock, the closing price for a share of Household
common stock on the merger date, the corresponding exchange ratio computed
using the formulas in the merger agreement, cash to be paid (other than for
fractional shares) and, for table 2, the implied value of the fraction of a
share of Household common stock that is to be exchanged for a share of
Renaissance common stock.
TABLE 1

Stock Only Election

<TABLE>
<CAPTION>
Closing Price Actual Market Value of
for Household Common Stock
20-Day Trading Household to One Share of
Value for Common Stock on Renaissance Common
Household Date of Merger Stock Election Stock on Date of
Common Stock (1)(2) (2) Exchange Ratio Merger
- ------------------- --------------- -------------- ----------------------
<S> <C> <C> <C>
Below $41.875 $35.00 0.7512 $26.2920
Below $41.875 $40.00 0.7512 $30.0480
Below $41.875 $45.00 0.7512 $33.8040
$41.875 $41.875 0.7512 $31.4560
$42.00 $42.00 0.7490 $31.4560
$42.25 $42.25 0.7445 $31.4560
$42.50 $42.50 0.7401 $31.4560
$42.75 $42.75 0.7358 $31.4560
$43.00 $43.00 0.7315 $31.4560
$43.25 $43.25 0.7273 $31.4560
$43.50 $43.50 0.7231 $31.4560
Above $43.50 $35.00 0.7231 $25.3085
Above $43.50 $40.00 0.7231 $28.9240
Above $43.50 $45.00 0.7231 $32.5395
</TABLE>
- --------
(1) The 20-day trading value for Household common stock is fixed at $41.875 if
it is $41.875 or below and at $43.50 if it is $43.50 or above.
(2) Hypothetical values only.

15
<PAGE>

TABLE 2

Cash and Stock Election

<TABLE>
<CAPTION>
Actual Market
Implied Value of Value of Household
Closing Price Household Common Stock to
20-Day Trading for Household Cash Paid per Share Common Stock to One Share of
Value for Common Stock of One Share of Renaissance Common
Household on Date of Renaissance Common Renaissance Stock on Date of
Common Stock (1)(2) Merger (2) Stock Common Stock (3) Merger
- ------------------- ------------- ------------------- ---------------- ------------------
<S> <C> <C> <C> <C>
Below
$41.875 $35.00 $6.5404 $24.9156 $20.8250
Below
$41.875 $40.00 $6.5404 $24.9156 $23.8000
Below
$41.875 $45.00 $6.5404 $24.9156 $26.7750
$41.875 $41.875 $6.5404 $24.9156 $24.9156
$42.00 $42.00 $6.4660 $24.9900 $24.9900
$42.25 $42.25 $6.3173 $25.1388 $25.1388
$42.50 $42.50 $6.1685 $25.2875 $25.2875
$42.75 $42.75 $6.0198 $25.4363 $25.4363
$43.00 $43.00 $5.8710 $25.5850 $25.5850
$43.25 $43.25 $5.7223 $25.7338 $25.7338
$43.50 $43.50 $5.5735 $25.8825 $25.8825
Above
$43.50 $35.00 $5.5735 $25.8825 $20.8250
Above
$43.50 $40.00 $5.5735 $25.8825 $23.8000
Above
$43.50 $45.00 $5.5735 $25.8825 $26.7750
</TABLE>
- --------
(1) The 20-day trading value for Household common stock is fixed at $41.875 if
it is $41.875 or below and at $43.50 if it is $43.50 or above.
(2) Hypothetical values only.
(3) The formula would fix the exchange ratio at .595 at all price levels based
on the assumption that 8.4 million shares of Renaissance common stock are
outstanding on the merger date.

Pro-rationing of All Stock or All Cash Elections

If you elect to receive all stock or all cash in the merger, you may be
subject to pro-rationing depending on the elections of other shareholders. If
the total shares to be issued pursuant to elections to receive a combination of
stock and cash and pursuant to elections to receive only stock would exceed
5,000,000 shares of Household common stock, then the number of shares issued to
persons who elect to receive only shares of Household common stock will be
reduced so that the total number of shares is only 5,000,000. The number of
shares will be reduced pro rata for each person electing to receive only shares
of Household common stock. For example: If there are only 2,000,000 shares
available for distribution to persons who elect to receive only shares (after
distributing shares to all persons who elected to receive a combination of
shares and cash), and those persons have elected to receive an aggregate of
4,000,000 shares, each person would receive half the number of shares they
otherwise would have been entitled to receive. The difference between the
number of shares actually distributed to these persons and the number they
would have received without pro-rationing will be paid in cash. Each Household
share received will be valued in the manner described under "Stock and Cash
Election" above, and the shareholder will receive in cash for each share of
Renaissance common stock he or she held the difference between $31.456 and the
implied value of the fraction of a Household share received with respect to the
Renaissance share.

Renaissance shareholders who elect to receive only cash may also be subject
to pro-rationing if the amount of cash requested (together with the cash
payable to persons who elected to receive a combination of cash and stock) is
more than the amount that would have been paid if all Renaissance shareholders
had elected to receive a combination of cash and stock. The amount of cash to
be received by these persons would be reduced pro rata for each person electing
to receive only cash. For example: If the amount of cash requested by

16
<PAGE>

persons who elect to receive only cash exceeds the amount that would have been
paid if all Renaissance shareholders had elected to receive a combination of
cash and stock by $25,000,000 and the total cash elections were for
$50,000,000, each person electing to receive only cash would receive half the
cash they requested. The remaining amount will be paid in the form of shares of
Household common stock valued as set forth above.

Required Vote; Merger Date

Holders of not less than a majority of the outstanding shares of each of the
three classes of Renaissance common stock entitled to vote thereon must vote in
favor of the approval of the merger agreement and plan of merger in order for
the transaction to be completed. Subject to such shareholder approval and the
satisfaction of certain conditions, including receipt of all requisite
regulatory approvals, the merger will become effective as soon as possible
thereafter in accordance with the laws of the States of Oregon and Delaware on
the later to occur of (y) the filing with the Secretaries of States in the
States of Oregon and Delaware of a certificate/articles of merger and (z) that
time, if any, subsequent to the time of such filing, designated in the
certificate/articles of merger as the time the merger shall become effective.
The parties have agreed that, unless a subsequent time and date is agreed to by
Household and Renaissance, the merger date will be no later than one business
day after satisfaction of the conditions described in "--Conditions to the
Merger; Amendment; Termination" herein.

The Boards of Directors of Household, Renaissance Credit Services and
Renaissance have approved the agreement and plan of merger. Approval of the
merger agreement by the stockholders of Household is not required.

All Cash Merger

In the event that the average high and low sales prices per share of
Household common stock on the NYSE as reported in The Wall Street Journal
(Midwest Edition) (and confirmed by William Blair & Company, L.L.C. and Lehman
Brothers) (the "trading value") on the merger date is less than $28.00, the
merger consideration payable will be solely cash, without interest, in an
amount equal to $31.456 per share of Renaissance common stock (a "Cash
Merger").

Conduct of Business Pending the Merger

Pursuant to the agreement and plan of merger, Renaissance has agreed to
carry on its business in substantially the same manner as conducted prior to
the execution of the agreement and plan of merger. The agreement and plan of
merger requires that Renaissance obtain the prior written consent of Household
prior to taking certain actions, including the issuance or redemption of any
shares of Renaissance common stock, the declaration or payment of any dividend
with respect to Renaissance common stock, entering into certain agreements and
making capital expenditures above specified thresholds.

Operations After the Merger

Upon the completion of the merger Renaissance will be merged with
Renaissance Credit Service and become a wholly-owned subsidiary of Household.
In addition, simultaneously with the merger Renaissance's subsidiary, Orchard
Federal Savings Bank, will be merged with and into Household's subsidiary,
Household Bank, f.s.b. Household expects that Renaissance's officers and
employees will be elected or appointed as the officers and employees of the
surviving corporation of Renaissance effective with the merger and will manage
Household's United States non-prime Visa and MasterCard credit card businesses.

Effect of the Merger on the Renaissance Employee Benefit Plans and Options

Under the terms of the agreement and plan of merger, each employee of
Renaissance or its subsidiaries who continues as an employee following the
merger will be entitled, as a new employee of Household or a subsidiary of
Household, to participate in such employee benefit plans or deferred
compensation, bonus or

17
<PAGE>

incentive plans or other employee benefit or fringe benefit programs that may
be in effect generally for similarly situated employees of Household and its
subsidiaries, provided the employee meets the eligibility tests of the plans
and programs and is not participating in a similar plan which is maintained by
Renaissance after the merger. Other than for vesting benefit accruals, accrued
or account formulas under any defined benefit plan maintained by Household,
Household will, for purposes of recognizing vesting and any age or period of
service requirements for commencement of participation with respect to any
plans or programs in which former employees of Renaissance may participate,
credit the employee with his or her term of service with Renaissance and its
subsidiaries. Notwithstanding the foregoing, Household has the right to amend,
modify or terminate any such plans or programs.

As of November 12, 1999, options to purchase 2,573,177 shares of Renaissance
common stock were outstanding under option plans or programs approved by
Renaissance. Unless the per share trading value of Household common stock is
less than $28.00 on the merger date, immediately following the merger all
unexercised Renaissance stock options, other than Compensatory Options and Non-
Compensatory Options (as defined below), will be assumed by Household in
accordance with the terms of these plans or programs and will be exercisable
for the number of whole shares of Household common stock equal to the number of
shares of Renaissance common stock that were issuable upon exercise of such
Renaissance stock option multiplied by the stock election exchange ratio,
rounded down to the nearest share. The exercise price for each share of
Household common stock issuable upon exercise of the assumed options will be
determined by dividing the exercise price for each Renaissance stock option
prior to its assumption by Household by the stock election exchange ratio,
rounded up to the nearest whole cent. The number of shares subject to these
assumed options may be reduced, if necessary, to preserve the treatment of such
options as incentive stock options.

Prior to the merger, Renaissance intends to advise employee holders of
Renaissance stock options granted in 1999 having a $14.00 per share exercise
price (the "Compensatory Options") that it will cancel such options. In
connection with such cancellation the holders of such options will release all
claims they may have with respect to the option and will receive the number of
shares of Renaissance common stock issuable upon exercise of the option (to the
extent the option was vested at the time of cancellation) multiplied by the
"option ratio" determined for that option. The "option ratio" shall be $31.456
per share of Renaissance common stock less the exercise price of the related
option divided by $31.456. Holders of Compensatory Options who agree to the
release described above will be entitled to additional cash consideration for
such options if the merger is completed. Payments of such stock and cash made
in connection with the cancellation of certain Compensatory Options must also
be approved by the Renaissance shareholders at the special meeting. In the
event the holders of the Compensatory Options fail to release Renaissance of
any liability in connection with such cancellation, the holder of such option
will not be entitled to these shares.

In addition, prior to the merger Gerald Bidwell, Irving J. Levin, Millcross
High Yield Fund L.P. and Ruth Scherbarth will exercise their options granted in
December 1996 (the "Non-Compensatory Options") in a cashless exercise.

If the per share trading value of Household common stock is less than $28.00
on the merger date, each unexercised Renaissance stock option will be converted
into the right to receive cash in the amount equal to $31.456 minus the
exercise price of such option.

Interest of Certain Persons in the Merger

General. As described below, certain directors, shareholders and officers of
Renaissance have interests in the merger in addition to any interest they may
have as a general shareholder of Renaissance. These interests include, among
others, certain ongoing employee benefits as described below and
indemnification rights under the agreement and plan of merger. Renaissance's
Board of Directors was aware of the interests of all of such persons at the
time it approved the agreement and plan of merger.

Director and Officer Ownership. All Renaissance directors and executive
officers hold, either directly or indirectly, Renaissance common stock or
options to purchase Renaissance common stock. See "Principal Shareholders of
Renaissance."

18
<PAGE>

CEO Bonus Payment. The Renaissance Board has awarded Irving J. Levin a cash
bonus in the amount of $7.775 million in recognition of his past and current
meritorious performance. Such bonus is subject to certain conditions and will
be paid prior to the merger date.

Employment and Non-Compete Agreements. As a condition to entering the
agreement and plan of merger, Household required that four of Renaissance's
principal executive officers execute employment agreements or modifications to
existing employment agreements and enter into non-compete agreements. The
agreements will be effective as of the merger date. See "--Management of
Renaissance." The agreements are intended to mitigate the uncertainties of
future employment prospects for such individuals in connection with the merger.
Under the terms of the employment agreements, Renaissance agrees to employ the
individuals in their existing capacities through August 31, 2002, or in the
case of Mr. Levin to December 31, 2002, following the merger.

Pursuant to each non-compete agreement, each officer has agreed, with
certain qualifications, to not accept employment with or invest in a business
which is principally a non-prime credit card consumer lender within the United
States or Canada until after December 31, 2002.

Stockholder Agreements. Each of General Electric Capital Corporation, Irving
J. Levin, George F. and Sharon C. Alexander, Charles B. Engelberg, Karen D. and
Fritz Frolich, William R. Reesman, Patricia Reesman, The Patricia L. Reesman
Family Limited Partnership L.L.P., Neil Goldschmidt, Martin and Virginia
Mitchell, Noel L. Nelson and Ruth Scherbarth have entered into agreements with
Household to vote all shares of Renaissance common stock held by them in favor
of the merger. These shareholders hold in the aggregate approximately 84% of
the Renaissance common stock, including 100% of the Class B and Class C common
stock. In the agreements, these shareholders have agreed that they will not
exercise any dissenters' rights, transfer their shares, grant any proxy, power-
of-attorney or other authorization to vote such shares, or take any other
action that would restrict or interfere with their obligations under the
agreements. In addition, these shareholders have agreed not to solicit,
initiate, or encourage any discussion or negotiations concerning the submission
of any competing takeover proposal. However, such agreements do not restrict
the ability of Renaissance's directors and officers to fulfill their fiduciary
duties to Renaissance. The agreements may be terminated in certain limited
circumstances, which include the termination of the agreement and plan of
merger in accordance with its terms.

Extent of Agreements to Hold Household Common Stock. Irving J. Levin,
Charles B. Engelberg, George Alexander and Karen D. Frolich, who, on November
12, 1999, held approximately 24% of the outstanding Renaissance common stock
(excluding the Renaissance Class B and Class C common stock), have agreed to
hold at least 50% of the shares of Household common stock they acquire in the
merger through December 31, 2000 and to hold at least 25% of such shares
through December 31, 2001; provided these restrictions will lapse and be of no
effect upon the termination of such person from the employment with
Renaissance, Household or an affiliate of Household.

In addition, holders of Compensatory Options who receive shares of
Renaissance common stock for their options will, except as provided below, be
restricted as to the sale or transfer of such shares, or shares of Household
common stock received in exchange for such shares in the merger. Such holder
may, if he or she is an employee of Renaissance, Household or any affiliate of
Household, sell up to one-third of the shares of Household common stock
received any time after the first anniversary of the original issuance of the
related option, up to two-thirds of such shares any time after the second
anniversary of the original issuance of the related option and all of such
shares any time after the third anniversary of the original issuance of the
related option. If such holder's employment with Renaissance, Household or any
affiliate of Household terminates at any time prior to the third anniversary of
the original issuance of the related option for any reason other than for
cause, these restrictions will terminate on the tenth anniversary of the
original issuance of the related option.

Agreement with General Electric Capital Corporation. General Electric
Capital Corporation ("GECC") invested in Renaissance in June 1997. As part of
this investment GECC was issued a warrant by Renaissance to purchase up to
1,396,082 shares of Renaissance common stock. Currently GECC has the right to
acquire

19
<PAGE>

867,341 shares of Renaissance common stock at a price of $2.507 per share
pursuant to this warrant. In connection with the merger, Household has agreed
to purchase the warrant from GECC for $25,108,654.61 immediately upon
completion of the merger. This amount was determined by taking (i) the
difference between $31.456 per share of Renaissance common stock less the
warrant strike price of $2.507 per share, which was then multiplied by (ii) the
number of shares of Renaissance common stock issuable under the warrant.

Additionally and in connection with the merger, GECC will permit Renaissance
to repay, in full, in the amount of $3.5 million, the subordinated notes due in
2003 issued by Renaissance in 1997. There will be no premium or penalty
assessed against Renaissance for such early repayment.

Agreement with Household. Renaissance entered into a credit card alliance
with a subsidiary of Household in April 1999. Under this alliance, Renaissance
markets and services certain credit card accounts for the benefit of both
Household and Renaissance.

Additional Cash Consideration for Option Cancellations. As discussed,
Compensatory Options are to be cancelled and may be exchanged for shares of
Renaissance common stock prior to the merger. Holders of these Compensatory
Options, including Messrs. Levin, Engelberg, Alexander and Ms. Frolich will be
paid an amount in connection with the cancellation of their options that is
equal to 23.83% or 43.37% of the appreciated value of such option. The
appreciated value of the option shall be $31.456 per share less the exercise
price for such share. For Messrs. Levin, Engelberg, Alexander and Ms. Frolich
these amounts are expected to be $185,110, $223,950, $147,598 and $148,246,
respectively. These amounts will only be paid if approved at the special
meeting.

Renaissance Incentive Compensation Plan. To encourage certain employees of
Renaissance and its subsidiaries to remain in the employ of the surviving
company following the merger, the Renaissance Board has approved an incentive
compensation plan, subject to the approval of shareholders. The plan also
contemplates payment of an incentive to the following key employees who are
executive officers and directors: Irving Levin, George Alexander,
Charles Engelberg, and Karen Frolich. Payment of the incentive amount is based
on performance of the surviving company, as measured by average credit card
accounts, during 2000, 2001 and 2002. See "Renaissance Incentive Compensation
Plan."

Acceleration of Option Vesting for Certain Executive Officers. The options
granted to Renaissance employees, including George Alexander, Charles Engelberg
and Karen Frolich, on October 31, 1997 and October 1, 1998, shall, to the
extent not already vested, become fully vested on the merger date.

Loan to Irving J. Levin. In connection with the merger, Household agreed
that one of its subsidiaries would offer to lend Irving J. Levin up to an
aggregate principal amount of $28 million on customary loan terms in connection
with his exercise, prior to the merger, of certain of his options for shares of
Renaissance common stock. In connection with this loan, Mr. Levin is required
to pledge to that subsidiary a sufficient number of shares of Household common
stock to fully collateralize this loan.

Indemnification and Insurance. The agreement and plan of merger provides
that Renaissance Credit Services shall insure that all rights to
indemnification and defense and all limitation of liability existing in favor
of any person who was or is, or who becomes prior to the merger, a director or
officer of Renaissance or any of its subsidiaries, as provided in Renaissance's
articles of incorporation and bylaws and similar governing documents of any of
its subsidiaries or indemnification agreements, with respect to claims or
liabilities arising from facts or events existing or occurring prior to the
merger, shall survive the merger and shall continue in full force and effect.
Renaissance Credit Services further agreed to indemnify and defend each
indemnified party to the fullest extent permissible by applicable law, against
losses, expenses, claims, damages and liabilities paid in settlement of claims
during such indemnified party's service as an officer or director of
Renaissance at or prior to the merger.

20
<PAGE>

Renaissance and its subsidiaries maintain in effect policies providing
insurance coverage for their directors and officers. Pursuant to the agreement
and plan of merger, Household will cause the surviving corporation to maintain
such current director and officer liability policies, or, to the extent
available, to replace such policies with policies providing terms which are no
less advantageous to such directors and officers, with respect to actions or
omissions occurring at or prior to the merger for a period of six years after
the merger.

Resales by Affiliates

The shares of Household common stock issuable to Renaissance's shareholders
upon the merger have been registered under the Securities Act of 1933, as
amended (the "Securities Act"), but this registration does not cover resales by
any person who, directly or indirectly, controls or is controlled by, or is
under common control with, Renaissance (the "Affiliates") at the time the
agreement and plan of merger is presented to Renaissance's shareholders for
approval. Affiliates may only sell Household common stock they receive in the
merger pursuant to a valid registration as provided for by Rule 145 under the
Securities Act, or as otherwise permitted by applicable laws.

Rule 145(d) requires that persons deemed to be Affiliates resell their
Household common stock pursuant to some of the requirements of Rule 144 under
the Securities Act if their common stock is sold within the first two years
after the merger. After one year, if the Affiliate is not an affiliate of
Household and if Household is current in the filing of its periodic reports
pursuant to the Exchange Act of 1934, as amended (the "Exchange Act"), a former
Affiliate of Renaissance may freely resell the Household common stock received
in the merger without limitation. After two years from the merger, if the
Affiliate is not an affiliate of Household at the time of sale or for at least
three months prior to the sale, the Affiliate may freely resell the Household
common stock received in the merger, without limitation, regardless of the
status of Household's periodic reports. Household has agreed that none of the
Affiliates will be deemed affiliates of Household following the merger.

Background of the Merger; Renaissance's Reasons for the Merger

Other than statements of historical fact, the statements made in this
section, including without limitation, the statements as to the benefits
expected to result from the merger and as to the future financial performance
and analyses performed by Renaissance's financial advisor, are forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
Actual results could differ materially from those anticipated in these forward-
looking statements.

In 1997 the Renaissance Board recognized that additional capital and
management talent would be required to continue the growth and profitability of
Renaissance. The Renaissance Board accepted an equity and subordinated debt
investment from General Electric Capital Corporation in June 1997, and
authorized Renaissance senior management to seek prudent opportunities for
growth of Renaissance, even if such growth required additional capital.
Renaissance management also began actively recruiting and training additional
management talent to help Renaissance continue its rapid but controlled growth.

As a result of the growth in Renaissance's business and the historic level
of profitability of Renaissance by the end of 1998, certain shareholders of
Renaissance began suggesting the need to consider making their equity in
Renaissance more liquid. During the first six months of 1999, the Renaissance
Board deliberated over a variety of means of achieving liquidity for
shareholders while preserving the ethical business standards of Renaissance and
continuing to create excellent career opportunities for Renaissance employees.
At the June 10, 1999 meeting of shareholders, the shareholders made clear their
preference that Renaissance not engage in an initial public offering. The
shareholders suggested as an alternative that the Renaissance Board explore
other alternatives such as a sale of a portion of the Renaissance equity to a
strategic or financial investor, or a strategic merger of Renaissance with a
marketing partner such as Household. Household and Renaissance's

21
<PAGE>

subsidiary, Orchard Federal Savings Bank ("OFSB"), had enjoyed a successful
relationship for several years, under which OFSB serviced the deposits securing
secured credit cards issued by Household's affiliate bank. Commencing in early
1999, Renaissance and Household had expanded their relationship by entering
into a credit card alliance arrangement, pursuant to which Renaissance markets
and services credit card accounts for the benefit of both Renaissance and
Household.

Over the summer of 1999, the Renaissance Board and management retained
William Blair & Company, L.L.C., to act as financial advisor, and considered
approaching several different strategic or financial investors to determine if
there was an interest in pursuing a transaction that would meet the Renaissance
Board's objectives of providing shareholder liquidity while preserving
Renaissance's business ethics and career opportunities for employees. During
that same time, Renaissance and Household continued discussions about how to
expand Household's involvement with Renaissance beyond the credit card alliance
arrangement. After first offering to make a partial equity investment in
Renaissance, Household on October 1, 1999, made an offer to merge Renaissance
with a subsidiary of Household.

The Renaissance Board met on many occasions over the summer and into the
fall of 1999 to discuss and evaluate various courses of action, including
pursuit of the Household offer. In the course of its deliberations during
several meetings held in October and November 1999, the Renaissance Board
reviewed with Renaissance management and Renaissance's legal and financial
advisors factors that the Renaissance Board deemed relevant to the merger,
including the following:

. the strategic importance to Renaissance of the proposed merger;

. the liquidity desired by shareholders and the available alternatives for
achieving that liquidity;

. the consideration to be received by Renaissance shareholders in the
merger;

. information concerning Renaissance's and Household's respective
businesses, prospects, strategic business plans, financial performance
and condition, results of operations, technology positions, management
and competitive positions;

. Renaissance management's view as to the financial condition, results of
operations and business of Renaissance before and after giving effect to
the merger;

. Renaissance management's view as to the prospects of Renaissance's
continuing as an independent company;

. Renaissance management's view to Renaissance's ability to gain access to
the necessary capital to meet its strategic business goals in both the
near-term and long-term and the relative costs associated with obtaining
the capital;

. the risks, burdens and uncertainties of pursuing an initial public
offering of Renaissance common stock;

. current financial conditions and historical market prices, volatility and
trading information with respect to Household common stock;

. Renaissance management's view as to the effect of the merger on the core
business of Renaissance, and the potential to expand that business more
rapidly after consummation of the merger;

. the impact of the merger on Renaissance's employees and current and
prospective customers;

. the greater time, disruption and uncertainty associated with other
parties performing due diligence as compared to Household; and

. the compatibility of the management of Renaissance and Household.

During the course of deliberations concerning the merger, the Renaissance Board
also identified and considered a variety of potentially negative factors that
could materialize as a result of the merger, including the following:

. the risk that the potential benefits sought in the merger might not be
fully realized;

. the possibility that the merger might not be consummated and the effect
of the public announcement of the merger on Renaissance's employees and
current and prospective customers;

22
<PAGE>

. the risks associated with obtaining the necessary approvals required to
complete the merger; and

. the effects of the diversion of management resources necessary to respond
to due diligence inquiries, the negotiation and consummation of the
merger, the preparation of this proxy statement and prospectus and the
integration of the two companies.

In light of the Renaissance Board's knowledge of the business and prospects
of Renaissance and its business judgment, the Renaissance Board considered and
evaluated each of the factors listed above during the course of its
deliberations before approving the merger. In view of the wide variety of
factors considered by the Renaissance Board, the directors did not find it
practical to, and did not, quantify or otherwise assign relative weights to
the specific factors discussed above.

Recommendation of Renaissance's Board of Directors on Merger

At a special meeting of Renaissance's Board of Directors held on November
30, 1999, the directors unanimously determined that the merger is in the best
interests of Renaissance and its shareholders, unanimously approved the
agreement and plan of merger, and unanimously recommended approval of the
agreement and plan of merger by Renaissance's shareholders.

Material Contacts and Board Deliberations

In 1997, Renaissance's management and the Renaissance Board recognized the
need to seek prudent opportunities that would continue and possibly expand the
growth and profitability of Renaissance, even if such growth required
additional capital. At the suggestion of certain shareholders of Renaissance,
at the end of 1998 the Renaissance Board began developing a strategic planning
process for significantly enhancing the return to Renaissance shareholders and
the liquidity of their shares.

In October 1998, as a result of the noted strategy Renaissance's senior
management met with S. N. Mehta, a Group Executive of Household, David A.
Schoenholz, Household's Executive Vice President-Chief Financial Officer, and
other Household managers to discuss the possibility of creating a joint
business venture or alliance to manage and service non-prime credit card
accounts.

In November 1998, Household commenced a due diligence process for purposes
of entering into a strategic credit card alliance with Renaissance and to
confirm valuation of Renaissance with respect to a potential minority equity
investment in Renaissance.

In January 1999, a term sheet for entering into the alliance was signed by
Renaissance and Household.

In February 1999, discussions were commenced between Charles B. Engelberg,
Renaissance's Chief Financial Officer and other officers of Renaissance, and
Edgar Ancona, Household's Treasurer and other managers of Household,
concerning the possibility of Household making a minority equity investment in
Renaissance.

On March 17, 1999 an investment banker met with Renaissance's managers to
discuss options available to achieve their strategic plan, including capital
growth and increased shareholder liquidity options.

In early April 1999, the strategic credit card alliance was entered into by
Renaissance and a subsidiary of Household. On April 9, 1999 Charles B.
Engelberg met with representatives of William Blair & Company, L.L.C. to
discuss options available to Renaissance to enhance shareholder liquidity, to
address Renaissance's capital needs and to explore the possibility of having
them participate in Renaissance's capital raising process.

In May 1999, Renaissance management actively explored opportunities to meet
this strategic objective. An engagement letter was executed by Renaissance and
Orca Capital on May 12, 1999 to assist in Renaissance's review of capital and
funding alternatives and numerous presentations were made by various
investment bankers regarding potential capital raising and shareholder
liquidity alternatives available to Renaissance, including an initial public
offering.

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<PAGE>

On June 10, 1999 Renaissance's shareholder meeting occurred and
Renaissance's management presented its capital raising and shareholder
liquidity alternatives with the assistance of Orca Capital. The Renaissance
shareholders expressed their preference that Renaissance should not pursue an
initial public offering at such time.

On June 14, 1999, Charles B. Engelberg informed Pat Burke, Director of
Strategic Planning of Household, that Renaissance was interested in pursuing
discussions with Household for a significant equity investment to be made by
Household in pursuit of satisfying Renaissance's strategic plan of increasing
shareholder liquidity and raising capital.

On July 20, 1999, Renaissance executed an engagement letter with William
Blair & Company, L.L.C. to act as Renaissance's investment advisor.

In August 1999, S.N. Mehta and Pat Burke of Household and Irving J. Levin
and Charles B. Engelberg of Renaissance held several discussions concerning the
valuation of Renaissance.

In September 1999, William Blair & Company, L.L.C., together with Irving J.
Levin and Charles B. Engelberg of Renaissance, prepared an information
memorandum on Renaissance in preparation of approaching potential investors to
acquire Renaissance. This information was presented by William Blair & Company,
L.L.C. to the Renaissance Board on October 6, 1999.

On October 18, 1999, Renaissance received a preliminary, non-binding
indication of interest from Household to purchase Renaissance. Due diligence on
Renaissance in connection with this potential transaction was performed by
Household at the end of October and a letter of intent was executed on October
25, 1999 by Household and Renaissance setting forth the basic terms of the
merger. In late October and November 1999, four potential investors contacted
Irving J. Levin or William Blair & Company, L.L.C. to discuss the potential for
an investment in Renaissance or possibly a merger. At the direction of the
Renaissance Board of Directors and upon advice of legal counsel, William Blair
& Company, L.L.C. pursued discussions with each of the four interested parties
to determine their respective levels of interest in pursuing a transaction and
the timing of any prospective transaction. After those discussions three of the
four parties withdrew their expressions of interest.

The remaining interested party met with Irving J. Levin on November 8, 1999
to express an interest in a potential transaction. Following that meeting, the
interested party requested a high level discussion with management of
Renaissance to refine its level of interest and to begin due diligence
discussions. Household expressed the view that pursuit of such discussions
would potentially result in the withdrawal of Household's offer to proceed with
the merger. Based on that expression and on the risks associated with pursuing
further discussions with the third party, including potential competitive
concerns, the Renaissance Board determined on November 16, 1999 to suspend
further discussions with the interested party. The Renaissance Board took into
account the high likelihood, at the time, of consummating a transaction with
Household, the fact that Household had completed extensive due diligence on
Renaissance over a long period of time and the fact that the interested party
had not even commenced due diligence, let alone provided Renaissance with a
definitive offer to evaluate.

On November 9, 1999, the Household Board reviewed the proposed investment to
acquire Renaissance and approved, by unanimous vote, the merger. Renaissance
conducted due diligence on Household during October and November, and Irving J.
Levin and a representative of William Blair & Company, L.L.C. met with
Household senior management on November 29, 1999 to complete such due
diligence. On November 30, 1999 the Renaissance Board reviewed the proposed
merger with Household and approved, by unanimous vote, the merger as being in
the best interests of Renaissance and its shareholders. The agreement and plan
of merger was executed by Renaissance and Household as of November 30, 1999 and
was publicly announced on December 2, 1999.

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<PAGE>

Opinion of Renaissance's Financial Advisor

Renaissance retained William Blair & Company, L.L.C. ("William Blair") to
act as its financial advisor in connection with the merger. As part of its
engagement, Renaissance asked William Blair to render an opinion as to whether
the consideration to be received by Renaissance's shareholders, except for
those holders who acquired shares of Renaissance common stock in consideration
of the cancellation of Compensatory Options (the "Shareholders") pursuant to
the merger agreement is fair to such Shareholders from a financial point of
view. No limitations were imposed by the Renaissance Board of Directors upon
William Blair with respect to the investigations made or the procedures
followed by it in rendering its fairness opinion. William Blair is a nationally
recognized firm and, as part of its investment banking activities, is regularly
engaged in the valuation of businesses and their securities in connection with
merger transactions and other types of strategic combinations and acquisitions.
Renaissance retained William Blair as its financial advisor on the basis of
William Blair's experience and expertise in transactions similar to the merger
and its reputation in the investment banking community.

At the November 30, 1999 meeting of the Renaissance Board of Directors,
William Blair rendered its oral opinion (later confirmed in writing as of such
date) that, as of such date, and based upon and subject to the factors and
assumptions set forth in such written opinion, the consideration to be received
by Renaissance's Shareholders in the merger was fair to Renaissance's
Shareholders from a financial point of view. The full text of William Blair's
opinion to the Renaissance Board of Directors dated as of November 30, 1999 is
attached hereto as Annex B and is incorporated herein by reference and should
be read in its entirety in connection with this Prospectus and Proxy Statement.
The following summary of William Blair's opinion is qualified in its entirety
by reference to the full text of William Blair's opinion. William Blair's
opinion was addressed to the Renaissance Board of Directors for the purposes of
its evaluation of the merger and does not constitute a recommendation to any
Renaissance Shareholder as to how such Shareholder should vote at the special
meeting.

In connection with its opinion, William Blair reviewed a final draft of the
merger agreement, as well as certain financial and other information that was
publicly available or furnished to William Blair by Renaissance, including
certain internal financial analyses, financial forecasts, reports and other
information prepared by the management of Renaissance. William Blair held
discussions with members of management of Renaissance concerning Renaissance's
historical and current operations, financial condition and prospects as well as
with management of Household concerning Household's historical and current
operations, financial conditions and prospects. In addition, William Blair
examined:

. information regarding publicly available financial terms of certain other
business combinations William Blair deemed relevant;

. the financial position and operating results of Renaissance compared with
those of certain other publicly traded companies William Blair deemed
relevant;

. financial studies, analyses and investigations, and reviewed such other
factors as William Blair deemed appropriate for the purposes of rendering
its opinion.

In rendering its opinion, William Blair assumed and relied, without
independent verification, upon the accuracy and completeness of all the
information examined by or otherwise reviewed or discussed with William Blair
for purposes of its opinion. William Blair did not make or obtain an
independent valuation or appraisal of the assets or liabilities of Renaissance.
William Blair was advised by the management of Renaissance that the financial
forecasts examined by William Blair were reasonably prepared on bases
reflecting the best currently available estimates and judgments of the
management of Renaissance William Blair expressed no opinion with respect to
the financial forecasts or the estimates and judgments on which they are based.
William Blair's opinion was based upon economic, market, financial and other
conditions existing on, and other information disclosed to William Blair as of
November 30, 1999. It should be understood that, although subsequent
developments may affect its opinion, William Blair does not have any obligation
to update, revise or reaffirm its opinion.

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<PAGE>

The following is a summary of the principal financial analyses performed by
William Blair to arrive at its opinion. William Blair performed certain
procedures, including each of the financial analyses described below, and
reviewed with Renaissance the assumptions upon which such analyses were based,
and other factors. The summary set forth below does not purport to be a
complete description of the analyses performed or factors considered by William
Blair in this regard.

Summaries of Valuation Analyses. In connection with its opinion and the
presentation of its opinion to the Renaissance Board, William Blair performed
certain valuation analyses, including:

.a comparison with comparable publicly traded companies;
.an analysis of certain comparable acquisition transactions; and
.a discounted cash flow analysis.

Such analyses are summarized below.

Comparable Public Company Analysis. William Blair reviewed and compared
certain financial information relating to Renaissance to corresponding
financial information, ratios and public market multiples for two publicly
traded companies with operations in the subprime credit card market, Metris
Companies and CompuCredit Corporation. William Blair selected these companies
because they are publicly traded companies which William Blair deemed most
comparable to Renaissance's operations. Although William Blair compared the
trading multiples of the selected companies at the date of William Blair's
opinion to the implied purchase multiples of Renaissance, none of the selected
companies is identical to Renaissance.

William Blair compared the multiples of common stock share price ("Price")
to earnings per share, as well as multiples of market equity value to tangible
book value implied by the terms of the merger to the corresponding multiples of
the comparable companies. Information regarding the multiples implied by the
terms of the merger compared to the multiples from William Blair's analyses of
selected comparable publicly traded companies is set forth in the following
table. The multiples and ratios for the comparable companies were based on the
most recent publicly available financial information and on earnings per share
estimates for 1999 and 2000 from First Call Corporation, and used the closing
share prices as of November 29, 1999.

<TABLE>
<CAPTION>
Comparable
Company
Renaissance Multiple
Multiple Offer Range
- -------- ----------- -----------
<S> <C> <C>
Price to LTM EPS........................................ 22.6x 19.0x-31.3x
Price to Estimated Calendar Year 1999 EPS............... 23.9x 15.2x-23.8x
Price to Estimated Calendar Year 2000 EPS............... 11.6x 12.2x-14.8x
Equity Purchase Price to Tangible Book Value............ 11.2x 6.8x- 7.8x
</TABLE>

Comparable Acquisition Transactions Analysis. William Blair performed an
analysis of selected recent merger or acquisition transactions in the consumer
finance industry. The selected transactions were chosen based on William
Blair's judgment that they were generally comparable, in whole or in part, to
the proposed transaction. In total William Blair examined four transactions
that were announced between January 20, 1997 and November 29, 1999. The
selected transactions were not intended to be representative of the entire
range of possible transactions in the consumer finance industry. The four
transactions examined were (acquirer / acquired company):

<TABLE>
<CAPTION>
Acquirer Acquired Company
-------- ----------------
<S> <C>
Household International ACC Consumer Finance
Household International Beneficial Corp.
Conseco Inc Green Tree Financial
Banc One First USA
</TABLE>

Although William Blair compared the transaction multiples of these companies
to the implied purchase multiples of Renaissance, none of the selected
companies is identical to Renaissance. William Blair reviewed

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<PAGE>

the consideration paid in such transactions in terms of the price paid for the
common stock ("Equity Purchase Price") of such transactions as a multiple of
net income for the twelve months prior to the announcement of such
transactions, as well as for the current and following year's net income
estimates as obtained from First Call Corporation. Additionally, William Blair
reviewed the consideration paid in such transactions in terms of the equity
value of such transactions as a multiple of tangible book value per the most
recent publicly available balance sheet prior to the announcement of such
transactions. Information regarding the multiples implied by the terms of the
merger compared to the multiples from William Blair's analyses of selected
comparable acquisition transactions is set forth in the following table.

<TABLE>
<CAPTION>
Comparable
Acquisitions
Renaissance Multiple
Multiple Offer Range
- -------- ----------- ------------
<S> <C> <C>
Price to LTM EPS....................................... 22.6x 22.9x-29.9x
Price to Current Calendar Year EPS..................... 23.9x 18.4x-28.6x
Price to Following Calendar Year EPS................... 11.6x 15.1x-25.1x
Equity Purchase Price to Tangible Book Value........... 11.2x 4.3x- 6.4x
</TABLE>

Discounted Cash Flow Analysis. Using a discounted cash flow analysis,
William Blair estimated the net present value of the free cash flows that
Renaissance could produce on a stand-alone basis over a five-year period from
2000 to 2004. Free cash flows is defined as net income less the amount of
capital required to be invested in the business to maintain an acceptable
capital ratio. The analysis was performed using the financial forecasts
prepared by Renaissance, and employed discount rates between 24.5% and 30.5%,
which were considered by William Blair to be an appropriate range given the
nature of Renaissance's business and the size of Renaissance. In addition,
William Blair utilized a terminal value multiple range of 12.0x to 16.0x 2004
net income, which multiple range William Blair considered appropriate given the
multiples of the companies considered in the "Comparable Public Company
Analysis". The discounted cash flow analysis conducted by William Blair
indicated a range between $238.0 million and $308.7 million.

The summary set forth above does not purport to be a complete description of
the analyses performed by William Blair. The preparation of a fairness opinion
is a complex process and involves various determinations as to the most
appropriate and relevant methods of financial analysis and the application of
these methods to the particular circumstances. Therefore, such an opinion is
not readily susceptible to summary description. The preparation of a fairness
opinion does not involve a mathematical evaluation or weighing of the results
of the individual analyses performed, but required William Blair to exercise
its professional judgment, based on its experience and expertise in considering
a wide variety of analyses taken as a whole. Each of the analyses conducted by
William Blair was carried out in order to provide a different perspective on
the merger and add to the total mix of information available. William Blair did
not form a conclusion as to whether any individual analysis, considered in
isolation, supported or failed to support an opinion as to fairness. Rather, in
reaching its conclusion, William Blair considered the results of the analyses
in light of each other and ultimately reached its opinion based on the results
of all analyses taken as a whole. William Blair did not place particular
reliance or weight on any individual analysis, but instead concluded that its
analyses, taken as a whole, supported its determination. Accordingly,
notwithstanding the separate factors summarized above, William Blair believes
that its analyses must be considered as a whole and that selecting portions of
its analyses and the factors considered by it, without considering all analyses
and factors, may create an incomplete view of the evaluation process underlying
its opinion. In performing its analyses, William Blair made numerous
assumptions with respect to industry performance, business and economic
conditions and other matters. The analyses performed by William Blair are not
necessarily indicative of actual values or future results, which may be
significantly more or less favorable than suggested by such analyses.

Renaissance entered into an engagement letter with William Blair on July 20,
1999, pursuant to which Renaissance has agreed to pay to William Blair (i) a
retainer fee of $15,000 per quarter for a minimum of four quarters, (ii) a fee
of $150,000, payable upon delivery of its opinion, regardless of the
conclusions reached by William Blair in its opinion, (iii) a fee of $100,000
payable at the time of the first mailing of any proxy, purchase offer or other
communication which includes William Blair's opinion to any common stockholder
of Renaissance, and (iv) a transaction fee, payable upon consummation of the
merger, equal to 1.0% of the total

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<PAGE>

consideration received by Renaissance and its common shareholders in the
merger, less any opinion or retainer fees previously paid to William Blair.
Renaissance will also reimburse William Blair for all out-of-pocket expenses
incurred by William Blair in connection with its engagement thereunder.
Renaissance has also agreed to indemnify and hold harmless William Blair and
certain related parties from and against certain liabilities, including
liabilities under the federal securities laws.

Household International's Reasons for the Merger

Household believes that the acquisition of Renaissance will provide
Household with a meaningful expansion of Household's existing non-prime credit
card operations. Such expansion will provide Household with the opportunity to
become a significant national competitor in the non-prime credit card business
without incurring significant start-up costs and time delays in achieving that
position. The expertise of Renaissance's personnel was of particular importance
to Household's management when evaluating Renaissance.

Conditions to the Merger; Amendment; Termination

Consummation of the merger is subject to satisfaction of a number of
conditions, including:

(1) the receipt of all necessary approvals of the transactions
contemplated by the agreement and plan of merger by governmental agencies
and authorities, and each of such approvals shall be in full force and
effect;

(2) no action shall have been taken, and no legal restraint shall have
been taken, and no legal restraint shall have been enacted, entered,
promulgated or enforced by any court having proper jurisdiction or
governmental authority which restrains, enjoins or otherwise prohibits the
consummation of the merger;

(3) compliance by Renaissance, Household and Renaissance Credit Service
with their respective covenants and the accuracy of their respective
representations and warranties as set forth in the agreement and plan of
merger, including the agreement of Renaissance that, except with the
approval of Household or as otherwise permitted by the agreement and plan
of merger, it will not, among other things:

(a) pay or declare dividends;

(b) effect any changes in connection with its equity capitalization,
except as related to outstanding stock options;

(c) become liable for any indebtedness for borrowed money except for
Federal Home Loan Bank borrowings, issuances of deposits and
certificates of deposits or under existing facilities, unless any new
borrowing may be terminated upon less than 90 days notice and require a
termination fee not in excess of $100,000;

(d) mortgage, encumber, sell or transfer any material assets other
than in the ordinary course of business consistent with past practices;
or

(e) except as may be directed by law, and in accordance with certain
constraints set forth in the agreement and plan of merger, conduct its
operations other than in the ordinary course of business;

(4) approval and adoption of the agreement and plan of merger by the
requisite affirmative vote of shareholders of Renaissance;

(5) receipt by Household of an opinion from Renaissance's counsel and
receipt by Renaissance of an opinion from counsel for Household and
Renaissance Credit Service, which opinions are to be in the general form of
those annexed to the agreement and plan of merger.

(6) the shares of Household common stock to be issued in exchange for
the Renaissance common stock shall have been approved for listing on the
NYSE;

(7) the shareholder voting agreements with selected Renaissance
shareholders have not been modified or terminated; and

(8) cancellation of the Compensatory Options and exercise of the Non-
Compensatory Options.

Any of the provisions of the agreement and plan of merger, including the
foregoing conditions, may be waived at any time by the party which is entitled
to the benefits thereof. The agreement and plan of merger may be amended or
modified in whole or in part by a duly authorized written agreement of the
parties. However, after the shareholders of Renaissance have approved the
agreement and plan of merger, Renaissance

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<PAGE>

may not amend or modify the agreement and plan of merger if law requires
further approval by such shareholders without obtaining such approvals.

The agreement and plan of merger may be terminated at any time prior to the
merger, whether before or after approval by the shareholders of Renaissance,
upon the occurrence of any of the following: (i) in the event of a breach by a
party of any representation, warranty, condition or agreement contained in the
agreement and plan of merger that is not cured within 20 business days of the
time that written notice of such breach is received by such party from the
other party; (ii) if the merger shall not have been approved by at least a
majority of each class of Renaissance's shareholders at the special meeting
called to vote with respect thereto; (iii) Renaissance receives an unsolicited
alternative acquisition proposal and in exercising its fiduciary duty to the
shareholders, after notice to Household, Renaissance's Board of Directors
determines that the agreement and plan of merger should be terminated and an
agreement providing for the alternative proposal should be accepted; or (iv)
the merger shall not have occurred by May 31, 2000.

The agreement and plan of merger also may be terminated, and the merger
thereby abandoned (whether before or after approval of the merger by
Renaissance's shareholders), by the mutual written consent of Renaissance and
Household at any time prior to the merger.

If the agreement and plan of merger is terminated due to receipt of an
alternative acquisition proposal as set forth above, or if approval of the
merger by the Renaissance common shareholders is not obtained (other than
following a breach of the agreement and plan of merger by Household),
Renaissance will be obligated to pay to Household a termination fee of
$7,000,000 and the reasonable out-of-pocket expenses (not in excess of
$1,000,000) incurred by Household in connection with the merger.

Certain Federal Income Tax Consequences

The following summary describes the material United States Federal income
tax consequences to Renaissance common shareholders of the merger. This summary
is based on the Internal Revenue Code of 1986, as amended (the "Code"), and
Treasury regulations, rulings, and judicial decisions as of the date hereof,
all of which may be repealed, revoked or modified so as to result in Federal
income tax consequences different from those described below. Such changes
could be applied retroactively in a manner that could adversely affect a
Renaissance common shareholder. In addition, the authorities on which this
summary is based are subject to various interpretations. It is therefore
possible that the Federal income tax treatment of the merger and the
distribution, holding and disposition of Household common stock and/or cash
received in the merger may differ from the treatment described below.

This discussion does not address all aspects of Federal income taxation nor
does this discussion address the effect of any applicable foreign, state, local
or other tax laws or the impact of Federal alternative minimum tax provisions.
This summary also does not address the U.S. Federal income tax consequences of
the merger to shareholders who are subject to special tax rules, such as
shareholders who are not United States holders, financial institutions, dealers
in securities, insurance companies, tax-exempt entities, regulated investment
companies, pass-through entities, persons who will acquire Household common
stock in connection with the exercise or termination of employee stock options
or otherwise as compensation, and holders who hold the Renaissance common stock
as part of a "hedge," "straddle," or "conversion transaction" or who have a
functional currency other than the U.S. dollar. A United States holder is the
beneficial owner of stock that is (i) for United States federal income tax
purposes a citizen or resident of the United States (including certain former
citizens and former long-term residents), (ii) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
of any political subdivision thereof, (iii) an estate the income of which is
subject to United States federal income taxation regardless of its source or
(iv) a trust with respect to the administration of which a court within the
United States is able to exercise primary supervision and one or more United
States fiduciaries have the authority to control all substantial decisions of
the trust. This discussion assumes that Renaissance common shareholders hold
their Renaissance common stock as

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<PAGE>

capital assets within the meaning of Section 1221 of the Code. EACH RENAISSANCE
COMMON SHAREHOLDER SHOULD CONSULT HIS OR HER OWN TAX ADVISOR AS TO THE
PARTICULAR TAX CONSEQUENCES TO HIM OR HER OF THE MERGER, AND CASH PAYMENTS
RECEIVED PURSUANT TO THE MERGER, INCLUDING THE APPLICABILITY AND EFFECT OF
FOREIGN, STATE, LOCAL, AND OTHER TAX LAWS.

Qualification of the Merger as a Reorganization under Section 368(a) of the
Code

Unless the per share market price of Household common stock on the closing
date of the merger is less than $28.00 ("Closing Date Value"), it is a
condition to closing that on the date of the merger Wilmer, Cutler & Pickering,
counsel to Household, and Stoel Rives LLP, counsel to Renaissance, provide
opinions to Household and Renaissance, respectively, to the effect that the
merger should be treated for Federal income tax purposes as a reorganization
under Section 368(a) of the Code (a "Reorganization"). These opinions will not
be delivered in the event that certain factual contingencies are not satisfied
(see "--Factual Contingencies" below). The tax opinions will be based on facts,
representations and assumptions set forth or referred to in such opinions, and
the opinions are subject to limitations and qualifications set forth in the
opinions. In providing these opinions, Wilmer, Cutler & Pickering and Stoel
Rives LLP will require and will rely on factual representations made by
Household, Renaissance Credit Services, and Renaissance. These opinions will
not be binding on the Internal Revenue Service ("IRS") or the courts, and the
parties do not intend to request a ruling from the IRS on the tax consequences
of the merger.

Factual Contingencies

The following factual contingencies, which cannot be resolved until the fair
market value of the Household common stock at the effective date of the merger
(the "Effective Date Value") is known, could cause Wilmer, Cutler & Pickering
and Stoel Rives LLP not to issue the opinions described above: (1) the total
amount of (a) cash or other consideration paid by Household for Renaissance
common stock, (b) cash paid by Household to Renaissance common shareholders who
perfect their dissenters' rights, (c) cash paid by Household to acquire
Renaissance stock rights, and (d) cash paid by Household for Renaissance
expenses, exceeds the aggregate Effective Date Value of Household common stock
issued to holders of Renaissance common stock in exchange for such stock in the
merger, or the Effective Date Value of Household common stock issued in
exchange for Renaissance common stock in the merger otherwise fails to equal at
least 50% of the fair market value of Renaissance at the merger date; or (2)
the Closing Date Value is less than $28.00 per share. In the latter event, the
consideration paid to holders of Renaissance common stock shall be solely cash.
(See "The Merger--All Cash Merger," and "--Alternative Structures of the
Merger" below.) Receipt of the opinions is a condition to merging except in the
case of conversion of the transaction to a Cash Merger. Accordingly, if the
opinions are not delivered, and the fair market value of the Household common
stock exceeds $28.00 per share on the date of the merger, the merger will not
be consummated. The Effective Date Value and Closing Date Value of Household
common stock will be, for each such date, the average of the high and low sales
prices per share of Household common stock on the NYSE as reported by The Wall
Street Journal (Midwest Edition).

Household and Renaissance expect that the merger will be completed and the
related tax opinions delivered.

Alternative Structures of the Merger

The parties have structured the merger with the intention that the merger,
as contemplated by the merger agreement, qualify as a Reorganization under
Sections 368(a)(1)(A) and 368(a)(2)(D) of the Code. If the merger qualifies as
a Reorganization, a Renaissance common shareholder who receives Household
common stock in the merger will recognize taxable gain only to the extent of
the lesser of: (1) the excess of the fair market value of all consideration
received in the merger (including cash and Household stock) over such

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<PAGE>

holder's adjusted basis in Renaissance common stock surrendered (hereinafter
referred to as "Overall Gain"), or (ii) the fair market value of any
consideration other than Household common stock received for Renaissance common
stock surrendered. If the merger qualifies as a Reorganization, Household stock
will be received free from federal income tax and have a basis in the hands of
a former holder of Renaissance common stock determined by reference to the
holder's basis in Renaissance common stock surrendered in exchange therefor.
(See "--Tax Consequences to Renaissance common shareholders If the merger
Qualifies as a Reorganization" below).

If the Closing Date Value of Household common stock is less than $28.00 per
share, the merger will proceed as a Cash Merger. In such an event, the
consideration paid to holders of Renaissance common stock shall be solely cash
in an amount equal to $31.456 per share of Renaissance common stock
surrendered. In the event of a Cash Merger, the merger will not qualify as a
Reorganization. (See "--Tax Consequences to Renaissance common shareholders in
the Event of a Cash Merger" below.)

IN THE EVENT OF A CASH MERGER, EACH RENAISSANCE COMMON SHAREHOLDER WILL
RECOGNIZE GAIN OR LOSS IN AN AMOUNT EQUAL TO THE DIFFERENCE, IF ANY, BETWEEN
THE AMOUNT OF CASH RECEIVED IN THE MERGER AND THE SHAREHOLDER'S BASIS IN
RENAISSANCE COMMON STOCK SURRENDERED, IF ANY (SEE BELOW.)

Tax Consequences to Renaissance common shareholders If the merger Qualifies as
a Reorganization

Treatment of Shareholders Who Exchange Renaissance common stock Solely for
Household common stock. Except as discussed below with respect to the receipt
of cash in lieu of fractional shares, a Renaissance common shareholder who
receives solely Household common stock in the merger will not recognize gain or
loss upon such exchange. The holding period of the Household common stock
received by a Renaissance common shareholder (including any fractional shares
to which he or she may be entitled) will include the period during which
Renaissance common stock surrendered in the merger was held by such holder,
provided that the Renaissance common stock surrendered was a capital asset in
the hands of such holder at the merger date. The aggregate tax basis of
Household common stock received by a Renaissance common shareholder (including
any fractional shares of Household common stock to which he or she may be
entitled) will be the same as the aggregate tax basis of Renaissance common
stock surrendered in the merger by such holder.

Treatment of Shareholders Who Exchange Renaissance common stock for a
Combination of Household common stock and Cash. Except as discussed below with
respect to cash received in lieu of fractional shares, a holder of Renaissance
common stock who receives a combination of Household common stock and cash,
other than cash in lieu of fractional shares, in exchange for Renaissance
common stock in the merger will recognize taxable gain in the amount which is
equal to the lesser of (i) the Overall Gain or (ii) the amount of cash such
holder receives, but will not recognize gain or loss on the remaining portion
of the consideration received in the form of Household common stock. The
holding period of the Household common stock received by a Renaissance common
shareholder (including any fractional shares to which he or she may be
entitled) will include the period during which Renaissance common stock
surrendered in the merger was held by such holder, provided that the
Renaissance common stock surrendered was a capital asset in the hands of such
holder at the merger date. The aggregate tax basis of Household common stock
received by a Renaissance common shareholder (including any fractional shares
of Household common stock to which he or she may be entitled) will be the same
as the basis of Renaissance common stock surrendered in the merger by such
holder decreased by any cash received by Renaissance common shareholder and
increased by any gain recognized in the merger (including any gain treated as a
dividend, as discussed below).

If cash distributed to a Renaissance common shareholder has the effect of a
distribution of a dividend, the gain recognized which is not in excess of the
holder's ratable share of undistributed earnings and profits will be treated as
a dividend to the holder. In making this determination, the Supreme Court has
ruled in Commissioner v. Clark, 489 U.S. 726 (1989), that such holders will be
treated as receiving solely Household common stock in the merger and,
immediately thereafter, having Household redeem a number of shares of Household
common

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<PAGE>

stock equal in value to the cash consideration the holders actually received.
The receipt of cash will not have the effect of a distribution of a dividend
under this analysis if such a hypothetical redemption satisfies the
requirements for exchange treatment (i.e., non-dividend treatment) under
Section 302 of the Code. That section provides three tests which could be
utilized to determine whether a distribution is treated as a sale or exchange
of a holder's shares: (i) the "substantially disproportionate" test is
satisfied with respect to a holder if the percentage of the outstanding
Household common stock actually and constructively owned by the holder
immediately following the merger is less than 80% of the percentage of the
outstanding Household common stock which the holder would have held if the
holder and all other holders of Renaissance common stock had received only
Household common stock in the merger in lieu of any cash payment; (ii) the
"complete termination" test is satisfied if (a) all shares of Renaissance
common stock actually and constructively owned by a holder are sold for cash or
(b) all such shares actually owned by the holder are sold for cash and the
holder effectively waives the constructive ownership rules of the Code in
accordance with the procedures of Section 302(c)(2) of the Code; and (iii) the
"not essentially equivalent to a dividend" test described below. A distribution
to a holder is "not essentially equivalent to a dividend" if it results in a
"meaningful reduction" in such holder's proportionate interest in Household. A
holder whose relative stock interest in Household is minimal and who exercises
no control over corporate affairs may be treated by reason of the cash payment
as experiencing a reduction in his or her proportionate interest in Household
under an IRS published ruling. In applying such ruling it is not clear that
minimal interest or control of corporate affairs can be tested by reference to
Household, although the ruling should generally be applicable in the case of
holders who meet its tests with reference to their holdings in Renaissance.
Other IRS published rulings hold that a "meaningful reduction" has occurred
when the transactions significantly reduce the holder's control over corporate
affairs as well as reducing his or her proportionate interest. In certain
events, dispositions of Renaissance common stock or Household common stock
which occur contemporaneously with the distribution of cash in the merger may
permit a holder to satisfy the Section 302(b) tests based on another IRS
published ruling (although such dispositions may affect the qualification of
the merger as a Reorganization).

In determining whether any of these tests has been met, shares considered to
be owned by the holder by reason of constructive ownership rules set forth in
Sections 302(c) and 318 of the Code, as well as shares actually owned, must be
taken into account. Because the determination as to whether any of the
alternative tests of Section 302(b) of the Code will be satisfied with respect
to any particular holder of Renaissance common stock depends on the holder's
individual facts and circumstances, holders are advised to consult their own
advisors to determine such tax treatment.

To the extent that cash payments pursuant to the merger are treated, in
accordance with the tests described above, as gain from the sale or exchange of
Renaissance common stock, such cash payments will be taxable to the extent of
Overall Gain as capital gains. For certain noncorporate holders (including
individuals), the rate of taxation of capital gains will depend upon (i) the
holder's holding period for Renaissance common stock, and (ii) the holder's
marginal tax rate for ordinary income. Holders should consult their tax
advisors with respect to applicable rates and holding periods, and rules for
netting such gains against capital losses sustained on other assets.

Conversely, any cash payments received in the merger that are treated as
dividends as described above will be taxable as ordinary income. In the event
that cash payments (other than payments to holders who demanded appraisal
rights or who otherwise qualify for redemption treatment and any payments for
fractional shares) should exceed Renaissance's undistributed earnings and
profits, any such distribution in excess of earnings and profits should be
taxed first as a non-taxable return of capital reducing the holder's tax basis
in Renaissance common stock, and then, if the holder's basis in Renaissance
common stock is exhausted, as a capital gain. (It is possible that the IRS
might contend that Household's earnings and profits must also be considered in
making this determination.)

Cash payments to corporate holders of Renaissance common stock pursuant to
the merger (other than payments to holders who demanded appraisal rights and
any payments for fractional shares) which are treated as dividends as described
above will qualify for the 70% dividends received deduction under Section 243
of the

32
<PAGE>

Code if the holding period and other requirements for such deduction are met,
subject to the limitations in Sections 246 and 246A of the Code (although the
benefits of the deductions may be reduced or eliminated by the corporate
alternative minimum tax). Under Section 246(c) of the Code the 70% dividends
received deduction is disallowed for any dividend with respect to stock (i)
that is held for 45 days or less during the 90-day period beginning 45 days
before the ex-dividend date or (ii) if the taxpayer is under an obligation to
make related payments with respect to positions in substantially similar or
related property. In addition, a taxpayer's holding period for these purposes
is suspended during any period in which the taxpayer has an option to sell, is
under a contractual obligation to sell, or has granted an option to buy,
substantially identical stock or securities, or holds one or more positions
with respect to substantially similar or related property that diminish the
risk of loss from holding the stock. Finally, under Section 246A of the Code,
the dividends received deduction may be reduced or eliminated if a corporate
holder's shares of Household common stock are debt-financed.

Section 1059 of the Code requires a corporate holder of stock to reduce (but
not below zero) its basis in the stock by the "nontaxed portion" of any
"extraordinary dividend" if the holder has not held the stock subject to a risk
of loss for more than 2 years before the date of the announcement, declaration,
or agreement (whichever is earliest) with respect to the extraordinary
dividend. In addition, the "extraordinary dividend" provision may apply without
regard to the period the stock was held if, in a redemption, a distribution is
not pro-rata as to all shareholders, is in partial liquidation of the company,
or is treated as a dividend by reason of options being taken into account under
Section 318(a)(4) of the Code.

A corporate holder will recognize gain in the year the dividend is received
to the extent the nontaxed portion of any extraordinary dividend exceeds the
holder's adjusted tax basis for the stock. Generally, the "nontaxed portion" of
an extraordinary dividend is the amount excluded from income under Section 243
of the Code (relating to the dividends received deduction described above). An
"extraordinary dividend" is a dividend that (i) equals or exceeds 10% of the
holder's adjusted tax basis in common stock (reduced for this purpose by the
nontaxed portion of any prior extraordinary dividend), treating all dividends
having ex-dividend dates within an 85-day period as one dividend, or (ii)
exceeds 20% of the holder's adjusted tax basis in the stock, treating all
dividends having ex-dividend dates within a 365-day period as one dividend,
provided, however, that in either case the fair market value of the stock (as
of the day before the ex-dividend date) may be substituted for stock basis if
the fair market value of the stock can be established by the holder to the
satisfaction of the IRS.

Treatment of Shareholders Who Exchange Renaissance common stock Solely for
Cash. If a holder of Renaissance common stock demands (see "The Merger--
Appraisal Rights of Company Stockholders") or elects to receive solely cash in
exchange for Renaissance common stock, any such cash received will treated as
received in a distribution in redemption of Renaissance common stock, subject
to the provisions of Section 302 of the Code. Where as a result of such
distribution, a Renaissance common shareholder owns no Household common stock,
either directly or by reason of the application of Sections 302(c) and 318 of
the Code, the redemption will be a complete termination of interest within the
meaning of Section 302(b)(3) of the Code and such cash will be treated as a
distribution in full payment in exchange for his or her Renaissance common
stock as provided in Section 302(a) of the Code. Such a holder will recognize
short- or long-term capital gain or loss (depending upon the holder's holding
period), measured by the difference between the amount of cash received and the
adjusted basis of Renaissance common stock surrendered. If the complete
termination of interest test is not satisfied by a holder who receives only
cash (because, for example, Renaissance common stock owned by a party related
to the holder is exchanged for Household common stock in the merger), the
holder may receive capital gains treatment if the cash received in exchange for
Renaissance common stock satisfies the Section 302(b) tests described above.
Holders should consult their own tax advisors to determine whether these tests
are met in their individual facts and circumstances.

Cash Payments in Lieu of Fractional Shares. Cash payments received by a
Renaissance common shareholder in lieu of a fractional share of Household
common stock will be treated as if the fractional shares were actually issued
by Household and then redeemed by Household for cash. These cash payments
generally

33
<PAGE>

will be treated as having been received in full payment for the fractional
share of Household common stock so redeemed since the purpose of the cash
distribution is to save the expense and inconvenience of issuing fractional
shares and the cash payments were not separately bargained for. In these
circumstances, the holder will recognize capital gain or loss equal to the
difference between the cash received and the adjusted basis of the fractional
share interests that would have been issued.

Tax Consequences to Renaissance common shareholders in the Event of a Cash
Merger

In the event of a Cash Merger, as described above, Renaissance common
shareholders will receive solely cash consideration in the amount of $31.456
per share of Renaissance common stock surrendered. In such an event, the merger
will not qualify as a Reorganization. Any such cash received will be treated as
a distribution in full payment in exchange for his or her Renaissance common
stock as provided in Section 302(a) of the Code. Such a holder will recognize
long- or short-term capital gain or loss (depending upon the holder's holding
period) measured by the difference between the amount of cash received and the
adjusted basis of Renaissance common stock surrendered.

Conversion of Shares and Exchange of Certificates

Upon consummation of the merger, the outstanding shares of Renaissance
common stock will be converted into cash, a combination of cash and shares of
Household common stock or solely Household common stock in accordance with the
election made by the holder of Renaissance common stock subject to pro-
rationing in certain events, unless the trading value of a share of Household
common stock on the merger date is less than $28.00. See "The Merger". Except
in the event that Household shall declare a stock dividend or distribution upon
or subdivide, split up, reclassify or combine its common stock or declare a
dividend, or make a distribution, on its common stock prior to the time the
merger becomes effective, no further adjustments will be made in the exchange
ratio or the stock election exchange ratio. However, in the event of such a
transaction, appropriate adjustments will be made.

Within two business days after the merger becomes effective, an election
form, instructions and a letter of transmittal (which may be all in one
document) will be furnished to the shareholders of Renaissance for use in
exchanging their certificates representing shares of Renaissance common stock
for the merger consideration. The letter of transmittal will be available to
holders of Renaissance common stock at the special meeting and will be mailed
to all shareholders by Harris Trust & Savings Bank as soon as practicable after
the special meeting. If any certificate for shares of Household common stock is
to be issued in a name other than that in which the certificate for shares of
Renaissance common stock surrendered for exchange is registered, the
certificate so surrendered must be properly endorsed or otherwise be in proper
form for transfer and the person requesting such exchange must pay to Household
or its transfer agent any applicable transfer or other taxes required by reason
of the issuance of the certificates of Household common stock.

Until so surrendered, certificates formerly representing shares of
Renaissance common stock will be deemed for all purposes only to represent the
right to receive the merger consideration. Dividends and other distributions,
if any, that become payable prior to the merger date on Renaissance common
stock will be retained by Household if the merger occurs until surrender of
such certificates, at which time such dividends and distributions will be paid,
without interest. In addition, after the merger the holders of certificates
formerly representing shares of Renaissance common stock shall cease to have
rights with respect to such shares, and, except as aforesaid, their sole right
shall be to exchange such certificates for the merger consideration in
accordance with the agreement and plan of merger.

Fractional Shares

No fractional shares of Household common stock will be issued in exchange
for shares of Renaissance common stock. In lieu thereof, each shareholder of
Renaissance having a fractional interest resulting from the exchange of
Renaissance common stock for Household common stock will be paid by Household
an amount in cash, without interest, equal to the value of such fractional
interest.

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<PAGE>

Accounting Treatment

Household expects to account for the acquisition of Renaissance as a
purchase under generally accepted accounting principles. Accordingly, all of
the assets and liabilities of Renaissance would be recorded in Household's
consolidated financial statements at their fair value on the date of the
merger, and the amount, if any, by which the purchase price paid by Household
exceeds the fair value of the assets acquired by Household through the merger
would be recorded as goodwill. Household's consolidated financial statements
would include the operations of Renaissance after the merger.

Required Regulatory Approvals

The closing of the merger is subject to the approval of the United States
Federal Trade Commission and the United States Department of Justice pursuant
to the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, as well
as the Office of Thrift Supervision pursuant to the Bank Merger Act. It is
anticipated that such federal agencies will not object to the merger, but no
assurance can be given that such approval will be obtained.

Transfer and Exchange Agents

Harris Trust & Savings Bank, Chicago, Illinois, serves as Transfer Agent and
as Registrar for Household common stock. Harris Trust & Savings Bank will act
as exchange agent in connection with the merger. Renaissance has historically
served as its own transfer agent.

Dissenters' Rights of Renaissance Shareholders

Under Sections 60.551 to 60.594 of the Business Corporation Act of Oregon,
any holder of Renaissance common stock who gives proper notice and who does not
vote in favor of the merger will, upon proper demand, have the right under
Oregon law to obtain payment of the fair value of his or her shares of
Renaissance common stock. All references in this section to a "shareholder" are
to the record holder or holders of shares of Renaissance common stock and to
"shares" are to shares of Renaissance common stock.

Sections 60.551 to 60.594 of the Business Corporation Act of Oregon are
reprinted in their entirety as Annex D to this Prospectus and Proxy Statement.
The following discussion is necessarily a summary of the law relating to
dissenters' rights and is qualified in its entirety by reference to Annex D.
The discussion contained in this Prospectus and Proxy Statement and in Annex D
should be reviewed carefully by any holder of Renaissance common stock who
wishes to exercise statutory dissenters' rights or who wishes to preserve the
right to do so, as failure to comply with the procedures set forth in this
Prospectus and Proxy Statement or in Annex D will result in the loss of
dissenters' rights.

A shareholder who wishes to exercise dissenters' rights generally must
dissent with respect to all the shares the shareholder owns or over which the
shareholder has power to direct the vote. However, if a record shareholder is a
nominee for several shareholders, some of whom wish to dissent and some of whom
do not, then the record shareholder may dissent with respect to all the shares
beneficially owned by any one person by notifying Renaissance in writing of the
name and address of each person on whose behalf the record shareholder asserts
dissenters' rights. A beneficial holder may assert dissenters' rights directly
by submitting to Renaissance the record shareholder's written consent to the
dissent and by dissenting with respect to all the shares of which the
shareholder is the beneficial shareholder or over which the shareholder has the
power to direct the vote.

A shareholder who does not deliver to Renaissance before the vote being
taken at the Renaissance special meeting a written notice of the shareholder's
intent to demand payment for the fair value of the shares will lose the right
to exercise dissenters' rights. Notice must be delivered to Renaissance at 9400
SW Beaverton-Hillsdale Hwy., Suite 300, Beaverton, Oregon 97005, before the
vote on February 1, 2000. In addition, any

35
<PAGE>

shareholder electing dissenters' rights must not vote his or her shares in
favor of the merger. A vote in favor of the merger will constitute a waiver of
dissenters' rights. A vote against the merger will not be regarded as a written
notice for purposes of asserting dissenters' rights.

If the merger is completed, the surviving corporation will, within 10 days
after the merger, deliver written notice to all shareholders who properly
perfected their dissenters' rights. The notice will, among other things:

. state where the payment demand must be sent and where and when
certificates must be deposited;

. inform holders of uncertificated shares, if applicable, to what extent
transfer of the shares will be restricted after the payment demand is
received;

. supply a form for demanding payment, which includes the date of the first
announcement of the terms of the merger and requires shareholders to
certify that they acquired beneficial ownership of the shares before the
date on which the merger was first announced; and

. set a date by which the surviving corporation must receive the payment
demand, which date will be between 30 and 60 days after the surviving
corporation delivers the notice to dissenting shareholders.

A shareholder wishing to exercise dissenters' rights must file the payment
demand, certify as to whether beneficial ownership of the shares was acquired
before the merger was announced, and deliver share certificates, in the manner
and by the time stated in the notice. Failure to do so will cause the person to
lose his or her dissenters' rights.

As soon as the merger is completed, or upon receipt of the payment demand,
the surviving corporation will pay to each dissenter with properly perfected
dissenters' rights the surviving corporation's estimate of the fair value of
the shareholder's shares, plus accrued interest from the date of the merger.
The surviving corporation will provide, along with payment, certain financial
information with respect to Renaissance, including Renaissance's balance sheet
and income statement for or as of a fiscal year ending not more than 16 months
before the date of payment and its latest available interim financial
statements, if any, an explanation of how Renaissance estimated the fair value
of the shares, an explanation of how the accrued interest was calculated and
other related information. With respect to a dissenter who did not beneficially
own Renaissance shares before the public announcement of the merger, the
surviving corporation is required to send an offer to make payment to the
dissenter, conditioned upon the dissenter's agreement to accept the payment in
full satisfaction of the dissenter's demands.

A dissenter dissatisfied with the surviving corporation's estimate of the
fair value may, within 30 days of payment or offer for payment by the surviving
corporation of the surviving corporation's estimate of the fair value of the
shareholder's shares, notify the surviving corporation in writing of the
shareholder's estimate of fair value of his or her shares and the amount of
interest due, and demand payment. If the surviving corporation does not accept
the dissenter's estimate and the parties do not otherwise settle on a fair
value, Oregon law requires that the surviving corporation commence a proceeding
in Multnomah County Circuit Court, and petition the court to determine the fair
value of the shares and accrued interest, naming all the Renaissance dissenting
shareholders whose demands remain unsettled as parties to the proceeding. The
court may appoint one or more persons as appraisers to receive evidence and
recommend the fair value of the Renaissance common stock. The dissenters will
be entitled to the same discovery rights as parties in other civil actions.
Each dissenter made a party to the proceeding will be entitled to judgment for
the amount, if any, by which the court finds the fair value of his or her
shares, plus accrued interest, exceeds the amount, if any, previously paid to
the dissenter by the surviving corporation.

Court costs and appraisers' fees will be assessed against the surviving
corporation, except that the court may assess these costs against some or all
of the dissenters to the extent that the court finds the dissenters acted
arbitrarily, vexatiously or not in good faith in demanding payment. The court
may also assess the fees and expenses of counsel and experts of the respective
parties in amounts that the court finds equitable (1) against the surviving
corporation, if the court finds that the surviving corporation did not
substantially comply with

36
<PAGE>

provisions of the Business Corporation Act of Oregon concerning dissenters'
rights and (2) against either the dissenter or the surviving corporation, if
the court finds that the party against whom the fees and expenses are assessed
acted arbitrarily, vexatiously or not in good faith. If the court finds that
services of counsel for any dissenter were of substantial benefit to other
dissenters similarly situated, and that fees should not be assessed against the
surviving corporation, the court may award to counsel reasonable fees to be
paid out of the amounts awarded to all dissenters who benefited from the
proceedings.

A shareholder entitled to dissent and obtain payment for the shareholder's
shares of Renaissance common stock under Sections 60.551 to 60.594 of the
Business Corporation Act of Oregon may not challenge the merger unless the
surviving corporation fails to comply with the procedural requirements imposed
by the Business Corporation Act of Oregon, the Renaissance articles or bylaws
or is fraudulent with respect to the shareholder or Renaissance.

Holders of Renaissance common stock who dissent from the merger will
generally recognize taxable gain or loss for federal income tax purposes.

In view of the complexity of Sections 60.551 to 60.594 of the Business
Corporation Act of Oregon, holders of Renaissance common stock who may wish to
dissent from the merger and pursue dissenters' right should consult their legal
advisors.

RENAISSANCE INCENTIVE COMPENSATION PLAN

The proposed Renaissance Incentive Compensation Plan (the "incentive plan")
is intended to provide special incentives related to the Renaissance business
after the merger of Renaissance with Renaissance Credit Services. The
Renaissance Board has approved the incentive plan, but it will only go into
effect if a sufficient percentage of Renaissance shareholders approve its
adoption (as explained below) and will cease to operate if the merger does not
occur.

Renaissance is seeking your approval of the incentive plan to provide
special performance bonuses with respect to this portion of the merged
companies' business, to increase the likelihood that Renaissance employees and
other persons selected for participation will remain with the merged companies,
and to improve the likelihood that the merged companies can deduct the payments
under the incentive plan.

Under the incentive plan, Renaissance, or another company Household
designates, will pay up to a total of $12 million over the next three years to
selected employees with respect to the performance of the Renaissance business
in retaining and developing active accounts in its non-prime lending business.
An "active account" means an account the Renaissance business manages that has
activity (borrowing, repayment, or otherwise) during a month, other than merely
an additional fee.

Whether the incentive plan will make payments depends upon the increase in
number of active accounts and the extent to which those increases come from
internal growth as opposed to acquisition through merger or otherwise of
another company and its accounts. Acquired accounts, but not internally
developed accounts, cease in part to count for this purpose after they have
been in existence for a year and cease to count at all after two years.

If the predetermined threshold for accounts is met in full, the maximum
payment for calendar year 2000 to all participants is $5.5 million, for 2001,
is $3.0 million, and for 2002, is $3.5 million, with a total for all years of
$12 million. Amounts not paid in one year are available under the incentive
plan in the following years (including, if the Renaissance administrator and
Household agree, in years after 2002). The maximum total payment is reduced for
taxes and, as described below, when certain individuals leave employment.

37
<PAGE>

Before the incentive plan will make any payment, active accounts must exceed
a specified threshold. The total payment will then be multiplied by the ratio
of the difference between a predetermined target account level and that
threshold, capped at 100 percent of the maximum payment for that calendar year,
reduced by certain forfeitures or the failure to meet individual performance
expectations. For example, if the accounts for 2000 exceed the threshold by 50%
of the difference between the target and the threshold, the maximum payment
would be 50% of $5.5 million, or $2.75 million, reduced by certain forfeitures
from employment terminations. Payments for 2001 and 2002 can be higher than the
individual year's maximum if amounts were not fully paid in prior years.

The Renaissance plan administrator (Irving Levin, absent specified changes
in circumstances) will select the participants and set ranges for possible
payments, with Household's consent. These parties will allocate approximately
90% of the potential payments for the year in advance, with the remainder
allocated after year's end. The allocations will set target percentages for
payments for individuals based on maximum achievement of the account growth,
but the Renaissance administrator will determine, with Household's consent,
whether an individual has earned the full amount for the year or some lesser
payment. Amendments or operational decisions can alter the allocation of
benefits among participants except with respect to incentives already
determined, but the plan does not provide for any payment in excess of a total
of $12 million. The maximum payment to Irving Levin will be $1,320,000 or 11%
of the total plan amount, although his percentage interest in the plan might be
as little as 4%.

The incentive plan imposes the following specific maximum payments on
certain participants, which may be lowered, and the Renaissance shareholders
will, by approving the incentive plan, also be approving payments under such
plan to the following participants and up to the following maximum amounts:

<TABLE>
<CAPTION>
Percentages of Total
Pool
----------------------- Maximum
Lower limit Upper limit Cumulative
Participants or range or range Amounts
- ------------ ----------- ----------- ----------
<S> <C> <C> <C>
George Alexander............................. 2% 7% $840,000
Charles Engelberg............................ 2 7 840,000
Karen Frolich................................ 2 7 840,000
Gary Barth................................... 1 4 480,000
Brian Enneking............................... 1 4 480,000
Glenda Goodrich.............................. 1 4 480,000
Jay Hemmady.................................. 1 4 480,000
Elaine Howard................................ 1 4 480,000
Jeanne Muenchau.............................. 1 4 480,000
Kirt Nelson.................................. 1 4 480,000
Lenice Shaw.................................. 1 4 480,000
Doug Hansen.................................. 0 2 240,000
Susie Hoiness................................ 0 2 240,000
Kathy Kobe................................... 0 2 240,000
</TABLE>

In addition to incentive plan payments, certain individuals may receive
compensation in the form of salary and performance bonus, acceleration of
options, grants of restricted stock, cash bonus payments designed to
approximate the recipient's tax liability relating to the restricted stock
grants, severance payments upon termination of employment, or other payments.

Compensation information regarding Messrs. Alexander and Engelberg and Ms.
Frolich is set forth in "Description of Renaissance--Executive Compensation".
In addition, Renaissance expects to pay $110,000 to Mr. Engelberg in 1999 that
otherwise would be paid to him February 2000 as part of his normal performance
bonus under Renaissance's bonus pool arrangement. Annual salary and bonus
compensation paid to each other employee for whom we are seeking incentive plan
payment approval is expected to range from $86,396 to $162,740 in 1999.

38
<PAGE>

In connection with the merger, options to purchase Renaissance stock granted
will automatically become fully vested. The number of shares subject to options
that will vest for each employee for whom we are seeking incentive plan payment
approval ranges from 0 to 25,334 and those options have exercise prices of
either $2.51 or $3.50 per share.

Renaissance or Household, in connection with the merger, may pay cash and
issue restricted stock to holders of Compensatory Options. See "Cash Payments
and Renaissance Common Stock Issued to Holders of Compensatory Options". The
value of the cash and stock (assuming a stock value of $31.456 per share) to be
issued to employees for whom we are seeking incentive plan payment approval
ranges from $0 to $992,190.90.

Messrs. Alexander and Engelberg and Ms. Frolich each is a party to an
employment agreement with Renaissance. Each agreement provides that the
employee will receive, upon termination of employment, severance payment equal
to 100 percent of his or her annual salary plus 100 percent of the average of
his or her last two years' cash bonuses. See "Description of Renaissance--
Executive Compensation--Employment Agreements". Pursuant to a severance policy
adopted by Renaissance and generally applicable to all other managerial
Renaissance employees, upon termination of employment an employee generally
will receive a severance payment equal to one-third of his or her annual base
salary plus one month's salary for each full year of service. Compensation
information regarding Messrs. Alexander, Engelberg and Ms. Frolich is set forth
in "Description of Renaissance--Executive Compensation". Annual base salary
compensation paid to each other employee for whom we are seeking incentive plan
payment approval is expected to range from $70,876 to $125,000 in 1999.

The incentive plan serves a retention purpose because departing employees
can lose their eligibility for any payment if they leave before a given year's
payment date. Renaissance will pay any individual incentives by January 31 of
the year following the year in which they were earned, assuming that the
individual is not under review for termination for "cause." However, an
individual who leaves voluntarily or is terminated for "cause" under specified
definitions will forfeit (lose any claim to receive) his or her incentive
payment, but an individual terminated without "cause" will receive a pro rata
portion for the year such employment ends.

Amounts forfeited by individuals will remain available under the incentive
plan (and go back into the total for allocation) unless those individuals were
previously designated as "key employees." The initial key employees for this
purpose are Irving Levin, George Alexander, Charles Engelberg, and Karen
Frolich. Amounts they or any later key employees forfeit are subtracted from
the total available under the incentive plan both in the year of termination
(unless they are terminated without "cause") and in later years.

The incentive plan's terms require that at least 75% of the shares of common
stock who are disinterested shareholders with respect to this plan (as
determined by the rules of the IRS) vote in favor of the plan before it becomes
effective. Renaissance is seeking votes from all shareholders and will then
evaluate whether those shareholders are "disinterested" for purposes of this
vote, based on the level of payments they could receive under the incentive
plan and in payments more directly connected with the merger. Renaissance is
seeking this approval to permit deductibility of the incentive plan and the
payments made thereunder in accordance with current IRS regulations. If the
shareholder approval is not received from 75% of the disinterested shareholders
(as determined by the rules of the IRS), then the incentive plan will not be
adopted and no payments under the incentive plan will be made.

The foregoing description of the incentive plan is qualified in all respects
by the actual provisions of such plan, which is attached to this Prospectus and
Proxy Statement as Annex C.

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<PAGE>

THE RENAISSANCE BOARD RECOMMENDS THAT YOU VOTE FOR THE APPROVAL OF THE
INCENTIVE PLAN AND CERTAIN PAYMENTS TO BE MADE UNDER THIS PLAN.

CASH PAYMENTS AND RENAISSANCE COMMON STOCK ISSUED TO HOLDERS OF COMPENSATORY
OPTIONS

Renaissance or Household may pay cash to the holders of Compensatory Options
who release Renaissance from any claim relating to the cancellation of those
options in an amount for each share for which such option could have been
exercised when vested in full equal to $7.5707, for incentive Compensatory
Options and $4.1598 for non-qualified Compensatory Options (see "The Merger--
Effect of the Merger on the Renaissance Employee Benefit Plans and Options",
and "--Interest of Certain Persons in the Merger"). In addition, Renaissance
may issue shares of Renaissance common stock to holders who cancel such
Compensatory Options in connection with the merger. It is necessary that
holders of at least 75% of the shares of Renaissance common stock who are
disinterested shareholders with respect to these proposals (as determined by
the rules of the IRS) vote in favor of these proposals. We are seeking this
approval to permit deductibility of these actions as compensation under current
IRS regulations.

The following table lists optionholders of Renaissance and their value in
shares of Renaissance common stock and the cash amount of the payments, for
which shareholder approval is required. The share value is calculated based on
the Renaissance shares they will receive at an assumed value per share of
$31.456. The actual value of the Household shares into which those Renaissance
shares convert will vary as will the value of other Renaissance shares. If the
shareholder approval is not received from 75% of the disinterested
shareholders, as determined by the rules of the IRS, then the optionholders
listed on the table will not receive any shares of Renaissance common stock or
any cash in consideration for releasing Renaissance from any claim relating to
the cancellation of the Compensatory Options.

<TABLE>
<CAPTION>
Amount of
Share Cash
Optionholders Values Payments Total
- ------------- ----------- ----------- -----------
<S> <C> <C> <C>
Charles Engelberg........................... $698,240.00 $223,950.90 $922,190.90
Karen Frolich............................... 349,120.00 148,245.57 497,365.57
George Alexander............................ 349,120.00 147,597.58 496,717.58
Jeanne Muenchau............................. 87,280.00 37,852.62 125,132.62
Glenda Goodrich............................. 61,096.00 26,496.83 87,592.83
Gary Barth.................................. 34,912.00 15,141.05 50,053.05
Lenice Shaw................................. 87,280.00 37,852.62 125,132.62
Brian Enneking.............................. 90,771.20 39,366.72 130,137.92
Kirt Nelson................................. 87,280.00 37,852.62 125,132.62
Jay Hemmady................................. 113,464.00 49,208.40 162,672.40
Elaine Howard............................... 43,640.00 18,926.31 62,566.31
Doug Hansen................................. 43,640.00 18,926.31 62,566.31
Susie Hoiness............................... 61,096.00 26,496.83 87,592.83
Kathy Kobe.................................. 17,456.00 7,570.52 25,026.52
</TABLE>

In addition to the cash payments and common stock issuances, certain
individuals may receive compensation in the form of salary and performance
bonus, acceleration of options, incentive plan payments, severance payments
upon termination of employment, or other payments. See discussion in
"Renaissance Incentive Compensation Plan".

THE RENAISSANCE BOARD RECOMMENDS THAT YOU VOTE FOR THE APPROVAL OF THE ISSUANCE
OF THE RENAISSANCE COMMON STOCK AND THESE CASH PAYMENTS IN CONNECTION WITH THE
MERGER.

40
<PAGE>

HOUSEHOLD

Description of Household

Household, through its subsidiaries, primarily provides consumers with
several types of loan products in the United States, the United Kingdom and
Canada. Household and its subsidiaries (including the operations of Beneficial
Corporation which we acquired in 1998) offer home equity loans, auto finance
loans, MasterCard and Visa credit cards, private label credit cards, tax refund
anticipation loans and other types of unsecured loans. Household also offers
credit and specialty insurance in the United States, the United Kingdom and
Canada. At September 30, 1999, Household had approximately 23,000 employees and
$67.8 billion in managed receivables and $49.3 billion in owned receivables.

Household was created as a holding company in 1981 as a result of a
shareholder approved restructuring of Household Finance Corporation, which was
established in 1878. In the last five years, Household has been restructuring
its operations to focus on the financial services business, specifically on
those areas of the consumer finance business that it believes offers the best
opportunity to achieve the highest returns on capital. From late 1994 through
1996 it exited from several businesses that were providing insufficient returns
on investment, such as its first mortgage origination and servicing business in
the United States and Canada, its individual life and annuity business and its
consumer branch banking business, including the sale of our consumer deposits.
In June 1997, Household purchased Transamerica Financial Services Holding
Company, the branch-based consumer finance subsidiary of Transamerica
Corporation. In October 1997, Household purchased all of the outstanding
capital stock of ACC Consumer Finance Corporation, a non-prime automobile
finance company. In December 1997, Household decided to exit from the business
of originating and acquiring student loans. In June 1998, Household merged with
Beneficial Corporation, a publicly traded consumer finance holding company. In
August 1999, Household purchased all the equity interests of Decision One
Holding Company LLC, a privately-held originator of non-prime first and second
mortgage loans. See "Additional Information--Where You Can Find More
Information."

Selected Financial Data

The following table sets forth selected consolidated financial information
of Household at and for the preceding five years ended December 31, 1998. The
statements of income and balance sheet data have been derived from Household's
audited Consolidated Financial Statements and Notes thereto. The information
for the preceding five years ended December 31, 1998 set forth below should be
read in conjunction with Household's 1998 Consolidated Financial Statements and
Notes thereto, Household's Form 8-K dated September 1, 1998 and other financial
information incorporated by reference or included in this Prospectus and Proxy
Statement. The selected financial data for Household for the nine months ended
September 30, 1999 and 1998 are unaudited and should be read in conjunction
with Household's Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 1999, which is incorporated by reference herein. Operating
results for the nine months ended September 30, 1999 should not be considered
indicative of results for any future periods or the year ending December 31,
1999.

41
<PAGE>

<TABLE>
<CAPTION>
HOUSEHOLD INTERNATIONAL, INC. AND SUBSIDIARIES
(DOLLARS IN MILLIONS)
----------------------------------------------------------------------------------------
AT OR FOR THE
NINE MONTHS ENDED
SEPTEMBER 30, AT OR FOR THE YEAR ENDED DECEMBER 31,
---------------------- -------------------------------------------------------------
(All dollar amounts are 1999 1998 1998 1997 1996 1995 1994
stated in millions) ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance Sheet Data (1)
Total assets (2):
Owned..................... $ 57,585.5 $ 51,452.2 $ 52,892.7 $ 46,817.0 $ 45,332.0 $ 44,723.0 $ 48,527.1
Managed................... 76,050.1 73,258.3 72,594.6 71,295.5 66,183.2 60,721.1 61,652.6
Managed receivables (3):
First mortgage............ $ 138.3 $ 196.0 $ 156.3 $ 396.6 $ 725.6 $ 2,066.9 $ 3,364.2
Home equity............... 25,261.4 21,812.2 22,330.1 19,824.8 16,197.5 16,506.7 14,734.5
Auto finance (4).......... 2,700.8 1,501.3 1,765.3 883.4 -- -- --
MasterCard/Visa........... 14,961.5 18,094.8 16,610.8 19,211.7 19,528.2 13,894.5 11,458.9
Private label............. 10,456.2 9,841.7 10,377.5 10,381.9 10,252.5 7,774.3 5,873.1
Other unsecured........... 13,600.8 11,878.9 11,970.6 11,505.1 11,557.6 9,375.1 7,784.9
Commercial................ 688.1 762.0 697.1 957.0 1,037.3 1,392.5 2,058.0
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total managed receivables.. 67,807.1 64,086.9 63,907.7 63,160.5 59,298.7 51,010.0 45,273.6
Receivables serviced with
limited recourse.......... (18,464.6) (21,806.1) (19,701.9) (24,478.5) (20,851.2) (15,998.1) (13,125.5)
---------- ---------- ---------- ---------- ---------- ---------- ----------
Owned receivables.......... $ 49,342.5 $ 42,280.8 $ 44,205.8 $ 38,682.0 $ 38,447.5 $ 35,011.9 $ 32,148.1
========== ========== ========== ========== ========== ========== ==========
Owned receivables:
Domestic:
First mortgage.......... $ 137.0 $ 194.3 $ 153.1 $ 385.7 $ 699.8 $ 2,001.3 $ 2,363.1
Home equity............. 21,648.3 16,357.3 17,474.1 12,348.5 8,291.0 9,564.1 7,958.2
Auto finance (4)........ 1,065.3 601.0 805.0 487.5 -- -- --
MasterCard/Visa......... 3,989.5 4,892.4 5,327.8 5,523.4 8,277.3 5,308.8 4,505.8
Private label........... 8,359.6 7,592.2 8,051.0 7,457.0 7,992.6 5,106.7 3,346.3
Other unsecured......... 7,210.1 5,676.0 5,573.3 5,018.7 6,365.9 6,763.7 6,604.2
Commercial.............. 684.9 751.9 690.8 863.9 994.1 1,336.5 2,003.8
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total domestic owned
receivables............... 43,094.7 36,065.1 38,075.1 32,084.7 32,620.7 30,081.1 26,781.4
---------- ---------- ---------- ---------- ---------- ---------- ----------
Foreign:
First mortgage.......... 1.3 1.7 3.2 10.9 25.8 65.6 1,001.1
Home equity............. 1,117.9 1,340.3 1,218.6 1,437.7 1,244.2 1,167.1 1,071.2
MasterCard/Visa......... 2,006.8 1,728.3 1,852.4 1,351.3 1,101.2 754.6 641.8
Private label........... 1,446.6 1,379.9 1,515.0 1,899.9 1,742.9 1,081.0 823.8
Other unsecured......... 1,672.0 1,755.4 1,535.3 1,804.4 1,669.5 1,806.4 1,774.6
Commercial.............. 3.2 10.1 6.2 93.1 43.2 56.1 54.2
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total foreign owned
receivables............... 6,247.8 6,215.7 6,130.7 6,597.3 5,826.8 4,930.8 5,366.7
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total owned receivables.... $ 49,342.5 $ 42,280.8 $ 44,205.8 $ 38,682.0 $ 38,447.5 $ 35,011.9 $ 32,148.1
========== ========== ========== ========== ========== ========== ==========
Deposits (5)............... $ 3,656.7 $ 1,909.1 $ 2,105.0 $ 2,344.2 $ 3,000.1 $ 5,351.3 $ 9,093.4
Commercial paper, bank and
other borrowings.......... 8,583.5 10,754.1 9,917.9 10,666.1 10,597.4 10,683.3 7,846.0
Senior and senior
subordinated debt......... 34,994.5 27,786.8 30,438.6 23,736.2 23,433.1 19,020.4 17,598.9
Company obligated
mandatorily redeemable
preferred securities of
subsidiary trusts......... 375.0 375.0 375.0 175.0 175.0 75.0 --
Convertible preferred
stock..................... 2.6
Preferred stock............ 164.4 264.5 164.4 264.5 319.5 319.5 434.6
Common shareholders' equity
(6)....................... 6,240.0 5,945.5 6,221.4 6,174.0 4,521.5 4,079.4 3,486.1
Selected Financial Ratios
(1)
Return on average owned
assets.................... 2.52% 0.47%(8) 1.04%(8) 2.03% 1.82% 1.25% 1.15%
Return on average managed
assets.................... 1.89 0.32(8) 0.72(8) 1.38 1.30 0.98 0.94
Return on average common
shareholders' equity...... 22.2 3.4(8) 8.1(8) 17.3 18.7 15.1 15.2
Common equity to owned
assets.................... 11.3 12.8 12.4 11.6 9.5 7.9 7.2
Total shareholders' equity
as a percent of managed
assets (7)................ 8.91 8.99 9.31 9.28 7.58 7.37 6.36
Tangible equity to tangible
managed assets............ 7.00 6.59 7.11 6.92 6.20 6.26 5.52
Managed net interest
margin.................... 8.21 7.81 7.86 7.72 7.45 7.05 7.27
Managed consumer net
chargeoff ratio........... 4.19 4.25 4.29 3.84 2.96 2.51 2.36
Managed basis efficiency
ratio, normalized......... 34.4 38.8 37.6 41.0 45.0 50.7 55.2
Dividend payout ratio...... 23.7 140.6(8) 58.3(8) 28.0 28.3 35.5 36.3
</TABLE>

42
<PAGE>

<TABLE>
<CAPTION>
HOUSEHOLD INTERNATIONAL, INC. AND SUBSIDIARIES
(IN MILLIONS, EXCEPT PER SHARE DATA)
--------------------------------------------------------------------
AT OR FOR THE
NINE MONTHS
ENDED
SEPTEMBER 30, AT OR FOR THE YEAR ENDED DECEMBER 31,
----------------- -----------------------------------------------
(In millions, except per 1999 1998 1998 1997 1996 1995 1994
share data) -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Statement of Income Data
(1)
Finance income.......... $4,776.3 $4,112.0 $5,604.2 $5,131.0 $4,935.8 $4,759.5 $4,287.0
Other interest income... 25.3 41.6 57.1 49.8 93.3 136.6 141.0
Interest expense........ 2,013.8 1,857.1 2,517.0 2,358.4 2,333.4 2,373.3 1,916.3
-------- -------- -------- -------- -------- -------- --------
Net interest margin..... 2,787.8 2,296.5 3,144.3 2,822.4 2,695.7 2,522.8 2,511.7
Provision for credit
losses on owned
receivables............ 1,263.2 1,139.3 1,516.8 1,493.0 1,144.2 1,025.1 795.1
-------- -------- -------- -------- -------- -------- --------
Net interest margin
after provision for
credit losses.......... 1,524.6 1,157.2 1,627.5 1,329.4 1,551.5 1,497.7 1,716.6
-------- -------- -------- -------- -------- -------- --------
Securitization income... 995.3 1,183.6 1,548.9 1,638.4 1,341.3 997.2 719.2
Insurance revenues...... 405.4 366.5 492.8 454.2 422.1 474.8 425.7
Investment income....... 128.0 120.9 161.2 173.1 220.7 524.8 566.6
Fee income.............. 421.2 444.1 599.7 592.4 352.2 292.5 331.0
Other income............ 180.0 183.6 243.7 355.7 419.6 319.4 241.7
Gain on sale of
Beneficial Canada...... -- 189.4 189.4 -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total other revenues.... 2,129.9 2,488.1 3,235.7 3,213.8 2,755.9 2,608.7 2,284.2
-------- -------- -------- -------- -------- -------- --------
Salaries and fringe
benefits............... 887.4 859.5 1,127.5 1,085.3 976.9 939.9 1,007.3
Occupancy and equipment
expense................ 200.0 246.2 316.1 333.6 328.9 337.9 356.9
Other marketing
expenses............... 264.0 303.7 403.2 449.6 431.5 307.9 283.5
Other servicing and
administrative
expenses............... 433.4 499.4 654.9 857.9 833.7 831.9 856.8
Amortization of acquired
intangibles and
goodwill............... 107.8 132.3 170.6 158.4 143.7 109.8 91.0
Policyholders' benefits. 199.0 176.0 238.2 255.9 311.9 554.9 550.9
Merger and integration
related costs.......... -- 1,000.0 1,000.0 -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total costs and
expenses............... 2,091.6 3,217.1 3,910.5 3,140.7 3,026.6 3,082.3 3,146.4
-------- -------- -------- -------- -------- -------- --------
Income before income
taxes.................. 1,562.9 428.2 952.7 1,402.5 1,280.8 1,024.1 854.4
Income taxes............ 515.3 254.0 428.6 462.2 461.2 420.4 309.1
-------- -------- -------- -------- -------- -------- --------
Net income.............. $1,047.6 $ 174.2(8) $ 524.1(8) $ 940.3 $ 819.6 $ 603.7 $ 545.3
======== ======== ======== ======== ======== ======== ========
Net income available to
common shareholders.... $1,040.7 $ 161.8 $ 509.1 $ 923.3 $ 797.7 $ 572.1 $ 512.5
======== ======== ======== ======== ======== ======== ========
Per Common Share Data
(1)
Basic earnings.......... $ 2.17 $ 0.33 $ 1.04 $ 1.97 $ 1.76 $ 1.26 $ 1.15
Diluted earnings........ 2.15 0.32(8) 1.03(8) 1.93 1.73 1.24 1.13
Dividends declared...... 0.51 0.45 0.60 0.54 0.49 0.44 0.41
Book value.............. 13.26 12.32 12.88 12.81 9.96 8.96 7.72
</TABLE>
- --------
(1) On June 30, 1998, Household merged with Beneficial Corporation, a consumer
finance company. In connection with the merger, Household issued
approximately 168.4 million shares of its common stock and three series of
preferred stock. The transaction was accounted for as a pooling of
interests, and accordingly, the consolidated financial statements for all
periods prior to the merger have been restated.
(2) In 1996, Beneficial's annuity product line was sold. In late 1995,
Household sold its individual life and annuity product lines of its life
insurance business and its first mortgage servicing portfolio and servicing
business. In 1994, Household sold its Australian subsidiary and retail
securities brokerage business.
(3) In 1998, we sold $1.9 billion of our non-core MasterCard and Visa
receivables and Beneficial's German and Canadian operations. Net
receivables relating to Beneficial's German and Canadian operations were
$272 million and $775 million, respectively. In 1997, we acquired the
capital stock of Transamerica Financial Services Holding Company ("TFS").
The acquisition included $3.1 billion of home equity receivables. We also
exited the student loan business and sold our $900 million student loan
portfolio. In 1996, we acquired $4.1 billion in credit card portfolios and
sold $1.7 billion of mortgage and consumer banking loans.
(4) In October 1997, we purchased ACC Consumer Finance Corporation, an auto
finance company. Prior to the fourth quarter of 1997, auto finance
receivables were not significant and were included in other unsecured
receivables.
(5) We sold our domestic consumer banking operations, including deposits of
$2.8 billion in 1996 and $3.4 billion in 1995. Our Candadian subsidiary
also sold $725 million in deposits in 1995.

43
<PAGE>

(6) In 1997 we issued 27.3 million shares of common stock in a public offering
raising about $1.0 billion. The net proceeds were used to repay certain
short-term borrowings incurred in connection with the acquisition of TFS.
(7) Total shareholders' equity includes common shareholders' equity, preferred
stock and company obligated mandatorily redeemable preferred securities of
subsidiary trusts. Total shareholders' equity excludes convertible
preferred stock that was fully converted or redeemed during 1995.
(8) Excluding merger and integration costs and the gain on sale of Beneficial
Canada, for the nine months ended September 30, 1998 and for the year ended
December 31, 1998, operating net income was $806.7 million and $1,156.6
million, respectively; diluted operating earnings per share was $1.59 and
$2.30, respectively; return on average owned assets was 2.17% and 2.29%,
respectively; return on average managed assets was 1.49% and 1.60%,
respectively; return on average common shareholders' equity was 16.7% and
18.2%, respectively; and the dividend payout ratio was 28.3% and 26.1%,
respectively.

44
<PAGE>

DESCRIPTION OF HOUSEHOLD CAPITAL STOCK

General

The following description of the capital stock of Household is qualified in
its entirety by reference to its Restated Certificate of Incorporation, as
amended, which has been filed with and is available from the offices of the
Securities and Exchange Commission as referred to under "Additional
Information--Where You Can Find More Information."

Household's Restated Certificate of Incorporation authorizes the issuance of
758,155,004 shares of capital stock of which 8,155,004 shares shall be
designated preferred stock, without par value, and 750,000,000 shares shall be
designated common stock, par value $1.00 per share. Although 8,155,004 shares
of preferred stock are authorized, 3,454,635 shares are reserved in the
Restated Articles of Incorporation for a series of convertible preferred stock
that was issued in 1981, all of which shares have been converted to Household
common stock, redeemed or repurchased by Household. As of December 20, 1999, of
the remaining 4,700,369 authorized shares of preferred stock, 2,148,279 shares
were issued and outstanding or reserved for issuance as follows: 50,000 shares
of 8 1/4% Cumulative preferred stock, Series 1992-A ("1992 Preferred"); 407,718
shares of the 5% Cumulative Preferred Stock (the "5% Preferred"), 103,976
shares of the $4.50 Cumulative Preferred Stock (the "$4.50 Preferred"), and
836,585 shares of the $4.30 Cumulative Preferred Stock (the "$4.30 Preferred")
were issued and outstanding and 750,000 shares of Series A Junior Participating
preferred stock ("Junior Preferred"). As of December 20, 1999, 467,879,375
shares of Household common stock were issued and outstanding. All outstanding
shares of Household common stock and preferred stock are fully paid and non-
assessable.

Preferred Stock

The preferred stock of Household may be issued from time to time in one or
more series as authorized by the Household Board of Directors or a duly
authorized committee thereof. The Board of Directors has adopted a resolution
creating an Offering Committee with the power to authorize the issuance and
sale of one or more series of preferred stock and to determine the particular
designations, powers, preferences and relative, participating, optional or
other special rights (other than voting rights which shall be fixed by the
Board of Directors) and qualifications, limitations or restrictions of the
preferred shares. The following description sets forth certain general terms
and provisions of the preferred stock of Household.

Dividends. Holders of shares of preferred stock are entitled to receive,
when and as declared by the Board of Directors of Household out of any funds
legally available for that purpose, dividends in cash at such respective rates,
payable on such dates in each year and in respect of such dividend periods, as
stated in Household's Restated Certificate of Incorporation or applicable
Certificate of Designation, Preferences and Rights for each series of preferred
stock, before any dividends may be declared or paid or set apart for payment
upon Household common stock. No dividend may be declared or paid on any series
of preferred stock unless at the same time a dividend in like proportion to the
respectively designated dividend rates shall be declared or paid on each other
series of preferred stock then issued and outstanding ranking prior to or on a
parity with such particular series with respect to the payment of dividends.
Dividends may be either cumulative or non-cumulative.

Liquidation Preference. In the event of dissolution, liquidation or winding
up of Household, whether voluntary or involuntary, holders of preferred stock
of each series (if any shares thereof are then issued and outstanding) will be
entitled to payment of the applicable liquidation price or prices, out of the
available assets of Household, after payment to Household's creditors but in
preference to the holders of the Household common stock. Household's Restated
Certificate of Incorporation, as amended, provides that a consolidation, merger
or sale by Household of its assets as an entirety or substantially as an
entirety shall not be deemed to be a liquidation, dissolution or winding up of
Household.

Redemption. No common stock of Household may be purchased by Household if
any dividends on any shares of preferred stock are in arrears, and no preferred
stock may be redeemed in such case unless all shares of issued and outstanding
preferred stock are redeemed.

45
<PAGE>

Voting Rights. Voting rights of the holders of preferred stock are non-
cumulative. Holders of preferred stock have such voting rights as are set forth
in Household's Restated Certificate of Incorporation, as amended, or applicable
Certificate of Designation, Preferences and Rights or as otherwise provided for
by law.

Household's Restated Certificate of Incorporation, as amended, provides
that, without the vote or consent of the holders of at least two-thirds of the
outstanding shares of all series of preferred stock (except for a series of
preferred stock in which the right is expressly withheld) voting as a single
class, Household may not (i) consolidate or merge with another corporation or
corporations or sell its assets as an entirety or substantially as an entirety;
(ii) issue any shares of preferred stock of any series if the cumulative
dividends payable on shares of any series of outstanding preferred stock are in
arrears; (iii) adopt any amendment to Household's Restated Certificate of
Incorporation which adversely alters the preferences, powers and special rights
of the preferred stock, provided, however, that if any such amendment would
adversely alter any preference, power or special right of one or more but not
all of the series of the preferred stock, then only the vote or consent of the
outstanding shares of all series of preferred stock so affected, voting as one
class, shall be required; or (iv) increase the authorized amount of the
preferred stock, or create or issue any class of stock ranking prior to or on a
parity with the preferred stock, or any series thereof, as to the payment of
dividends or the distribution of assets. In addition, the holders of the
outstanding shares of all series of preferred stock (except for a series of
preferred stock in which the right is expressly withheld) shall be entitled to
elect one-third of the members of the Board of Directors of Household out of
the number fixed by Household's Bylaws in the event Household fails to declare
and pay any four quarterly cumulative dividends, whether consecutive or not, on
any series of preferred stock and shall be entitled to elect a majority of said
directors should any eight quarterly cumulative dividends, whether consecutive
or not, be unpaid. Any such right to elect members of the Board of Directors of
Household shall continue until all unpaid dividends upon all series of
preferred stock shall have been paid in full.

Under current provisions of the General Corporation Law of the State of
Delaware, the holders of issued and outstanding preferred stock are entitled to
vote as a class upon a proposed amendment to Household's Restated Certificate
of Incorporation (whether or not entitled to vote thereon by Household's
Restated Certificate of Incorporation), with the consent of a majority of said
class being required to increase or decrease the aggregate number of authorized
shares of preferred stock, increase or decrease the par value of shares of
preferred stock, or alter or change the powers, preferences or special rights
of the preferred stock as to affect them adversely. If any proposed amendment
would alter or change the powers, preferences or special rights of one or more
series of preferred stock as to affect them adversely, but would not affect the
entire class of preferred stock, then only the shares of the series so affected
by the amendment would be considered a separate class for the purpose of
determining who is entitled to vote on the proposed amendment.

Preemptive Rights. Holders of preferred stock have no preemptive rights to
purchase any securities of Household.

Description of Each Authorized Series of Preferred Stock

The following summary descriptions of each authorized series of preferred
stock of Household are qualified in their entirety by reference to Household's
Restated Certificate of Incorporation, as amended (including the respective
Certificates of Designation, Preferences and Rights relating to such series).

1992 Preferred

General. The 1992 Preferred rank on a parity with all other series of
preferred stock as to the payment of dividends and distribution of assets of
Household upon the voluntary or involuntary liquidation, dissolution, or
winding up of Household.

Dividends. Holders of the 1992 Preferred are entitled to receive quarterly
cumulative dividends at an annual rate of $82.50 per share. All dividends on
the 1992 Preferred have been paid to date. In the event of

46
<PAGE>

the liquidation, dissolution or winding up of Household, whether voluntary or
involuntary, holders of the 1992 Preferred are entitled to receive $1,000 per
share plus accrued and unpaid dividends. The 1992 Preferred is not redeemable
prior to October 15, 2002. The 1992 Preferred is redeemable, at the option of
Household, in whole or in part, from time to time on or after October 15, 2002,
at $1,000 per share plus an amount equal to accrued and unpaid dividends. The
1992 Preferred is not entitled to the benefits of any sinking fund.

Voting Rights. The 1992 Preferred have the right, voting as a class with
each other and any other series of preferred stock ranking on a parity thereto
as to the payment of dividends or the distribution of assets and upon which
like voting rights have been conferred and are exercisable, to elect two
members of the Board of Directors of Household at the meeting of stockholders
called for such purpose after six quarterly cumulative dividends on such
preferred stock, whether consecutive or not, shall be in arrears. The right of
such holders of preferred stock to elect said members to the Board of Directors
shall continue until such time as all dividends accrued on such stock shall
have been paid in full, at which time such right shall terminate.

On any item with respect to which the holders of the 1992 Preferred are
entitled to vote, such holders shall be entitled to one vote for each share
held.

Conversion Rights. The holders of the 1992 Preferred do not have any rights
to convert the shares thereof into shares of any other class or series of
capital stock (or any other security) of Household.

5% Preferred; $4.50 Preferred; $4.30 Preferred

General. Household's 5% Preferred, $4.50 Preferred and $4.30 Preferred will
rank on parity with each other and the shares of 1992 Preferred as to dividends
and upon liquidation.

Dividends. The holders of 5% Preferred Stock and $4.50 Preferred will be
entitled to receive dividends at the rate of 5% per share each year and $4.50
per share each year, respectively, payable semi-annually on the last days of
June and December in each year. The holders of $4.30 Preferred will be entitled
to receive dividends at $4.30 per share each year, payable semi-annually on the
last days of March and September in each year. All dividends have been paid to
date.

Optional Redemption. At the option of Household, by vote of the Household's
Board, the 5% Preferred, $4.50 Preferred and $4.30 Preferred may be redeemed as
a whole, or in part, at any time or from time to time at a redemption price
equal to $50.00 per share, $103 per share, $100 per share, respectively, plus
an amount equal to accrued and unpaid dividends to the date fixed for
redemption, whether or not earned or declared. If less than all of the
outstanding shares of the 5% Preferred, $4.50 Preferred or $4.30 Preferred, as
the case may be, are to be redeemed the shares to be redeemed will be
determined by lot in such usual manner and subject to such regulations as the
Household Board in its sole discretion will prescribe.

Voting Rights. (a) Each share of the 5% Preferred, $4.50 Preferred and $4.30
Preferred will be entitled to one vote on each matter submitted to a vote of
the stockholders of Household and will vote as a single class with the
stockholders of Household. In addition, in case at any time three or more full
semi-annual dividends (whether consecutive or not) on the 5% Preferred, $4.50
Preferred or $4.30 Preferred, as the case may be, will be in arrears, then
during the period commencing with such time and ending with the time when all
arrears in dividends on the 5% Preferred, $4.50 Preferred or $4.30 Preferred,
as the case may be, will have been paid and the full dividend on the 5%
Preferred, $4.50 Preferred or $4.30 Preferred, as the case may be, for the then
current semi-annual dividend period will have been declared and paid or set
aside for payment, at any meeting of the stockholders of Household held for the
election of directors during that period, the holders of the 5% Preferred,
$4.50 Preferred or $4.30 Preferred, as the case may be, present in person or
represented by proxy at said meeting will be entitled, as a class, to the
exclusion of the holders of all other classes of stock of Household, to elect
two directors of Household. Each share of 5% Preferred, $4.50 Preferred or
$4.30 Preferred is entitled to one vote.

47
<PAGE>

(b) While any of the 5% Preferred, $4.50 Preferred or $4.30 Preferred
remains outstanding, Household shall not alter or change the preferences,
special rights or powers of such series so as to adversely affect the holders
of such series without the affirmative consent of the holders of at least two-
thirds ( 2/3rds) of the aggregate number of shares of such series then
outstanding.

Conversion Rights. The holders of the 5% Preferred, the $4.50 Preferred and the
$4.30 Preferred do not have any rights to convert the shares thereof into
shares of any other class or series of capital stock (or any other security) of
Household.

Junior Preferred

Issuance. Currently, there are no shares of Junior Preferred issued or
outstanding. Rights to purchase shares or fractions thereof of the Junior
Preferred ("Rights") have been distributed to holders of Household common
stock. Each Right entitles the registered holder to purchase from Household one
three-thousandth of a share of the Junior Preferred at a price of $100 per one
three-thousandth of a share, subject to adjustment in the event of any dividend
of shares of Household common stock or any subdivision, combination,
reclassification or change of the Household common stock. The designation and
terms of the Rights are set forth in a Rights Agreement ("Rights Agreement")
between Household and Harris Trust and Savings Bank, as Rights Agent, a copy of
which has been filed with and is available from the offices of the Securities
and Exchange Commission as referred to under "Additional Information Where You
Can Find More Information."

The Rights are not exercisable until the date which is ten days following
(i) a public announcement that a person or group of affiliated or associated
persons acquired 15% or more of the outstanding shares of Household common
stock or (ii) the commencement or announcement of an intention to make a tender
offer or exchange offer for 15% or more of the outstanding shares of Household
common stock. The Rights will expire on July 31, 2006, unless the expiration
date is extended or the Rights are earlier redeemed or exchanged by Household,
in each case, as described below.

In the event that Household is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold to a person or a group, the Rights Agreement provides that each
holder of a Right shall receive, upon the payment of the then current exercise
price of the Right, that number of shares of the common stock of the surviving
company which at the time of such transaction would have a market value of two
times the exercise price of the Right. In the event that any person or group of
affiliated or associated persons acquires beneficial ownership of 15% or more
of Household common stock, proper provision shall be made so that each holder
of a Right, other than Rights beneficially owned by such person or group (which
will thereafter be void), will thereafter have the right to receive upon
exercise that number Household International common shares having a market
value of two times the exercise price of the Right.

At any time prior to the public announcement that a person or group of
affiliated persons has acquired, or obtained the right to acquire, beneficial
ownership of 15% or more of the outstanding shares of Household common stock,
Household may redeem the Rights in whole, but not in part, at a price of $.01
per Right ("Redemption Price"). The redemption of the Rights may be made
effective at such time on such basis with such conditions as the Board of
Directors, in its sole discretion, may establish. Immediately upon the action
of the Board of Directors of Household electing to redeem the Rights, the right
to exercise the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.

Dividends. The holders of the Junior Preferred will be entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available for that purpose, quarterly dividends payable in cash commencing
after such shares or a fraction thereof are issued. Quarterly dividends will be
in an amount per share (rounded to the nearest cent) equal to the greater of
(a) $1 or (b) subject to adjustment as described below, 3,000 times the
aggregate per share amount of all cash dividends and 3,000 times the aggregate
per

48
<PAGE>

share amount (payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of Household common
stock or a subdivision, combination or reclassification thereof, declared on
Household common stock since the immediately preceding quarterly dividend
payment date or the date of the first issuance of the Junior Preferred if the
first dividend date has not yet occurred. In the event Household shall at any
time declare or pay any dividend on Household common stock payable in shares of
Household common stock, or effect a subdivision, combination or
reclassification of the outstanding shares of Household common stock into a
greater or lesser number of shares of Household common stock, then in each such
case the amount of dividends to which holders of Junior Preferred are entitled
to shall be adjusted.

Dividends will begin to accrue and be cumulative on the Junior Preferred
from the dividend date next preceding the date of issue unless that date of
issue is prior to the date for the first dividend date, in which case dividends
will accrue and be cumulative from the date of issue. Dividends paid on shares
of Junior Preferred in an amount less than the total amount of such dividends
at the time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding.

Conversion, Sinking Fund Redemption. The Junior Preferred will not have any
rights to convert to any other security issued by Household and such shares are
not redeemable at the option of Household. In addition, there is no sinking
fund for the Junior Preferred.

Voting Rights. The Junior Preferred generally votes together with Household
common stock as one class. Each share of Junior Preferred is entitled to 3,000
votes on all matters submitted to a vote of the stockholders of Household. In
the event Household declares or pays any dividend on its Household common stock
payable in shares of Household common stock, or subdivides, combines or
reclassifies its shares of Household common stock into a greater or less number
of shares of Household common stock, then the number of votes per share of the
Junior Preferred shall be adjusted. Additionally, the Junior Preferred will
have the right (as described under "Description of Household Capital Stock--
preferred stock--Voting Rights") to vote, together with all other outstanding
series of preferred stock for which such voting right has not been expressly
withheld, to elect directors in the event dividends on any series of preferred
stock are in arrears. In addition, the Restated Certificate of Incorporation of
Household shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Junior Preferred so as
to affect the Junior Preferred adversely without the affirmative vote of the
holders of two-thirds or more of the outstanding shares of Junior Preferred,
voting together as a single class. The Certificate of Designation, Preferences
and Rights of the Junior Preferred expressly withholds all other special voting
rights to which holders of preferred stock are entitled, except for voting
rights otherwise provided by law.

Liquidation Preference. No distribution shall be made on any shares of stock
ranking junior to the Junior Preferred upon any voluntary liquidation,
dissolution or winding up of Household unless the holders of the Junior
Preferred have received the greater of (i) $3,000 per share plus accrued and
unpaid dividends or (ii) 3,000 times the aggregate amount to be distributed per
share to holders of Household common stock. This liquidation amount shall be
adjusted in the event Household declares a stock split of Household common
stock or pays any dividend on Household common stock payable in shares of
Household common stock, or effects a subdivision, combination or
reclassification of Household common stock into a greater or lesser number of
shares. In the event the assets of Household are insufficient to satisfy the
liquidation preference of the Junior Preferred, the Junior Preferred shall
share ratably with each series of preferred stock ranking on a parity (as to
dividends or liquidation) with the Junior Preferred.

In the event of any merger, consolidation or other transaction in which
shares of Household common stock are exchanged, each Junior Preferred hare will
be entitled to receive 3,000 times the amount received per share of Household
common stock. These rights are protected by customary anti-dilution provisions.

Common Stock

Holders of Household common stock are entitled to receive dividends out of
any funds legally available for that purpose as and if declared by the Board of
Directors of Household, subject to the prior dividend rights of preferred
stock.

49
<PAGE>

Subject to certain voting rights of the preferred stock described elsewhere
herein, the holders of shares of Household common stock are entitled to vote at
all meetings of the stockholders and are entitled to one vote for each share of
Household common stock held.

The issued and outstanding shares of Household common stock are fully paid
and non-assessable. The holders of Household common stock are not entitled to
preemptive rights or conversion or redemption rights. The Household common
stock does not have cumulative voting rights in the election of directors.

In the event of the voluntary dissolution, liquidation or winding up of
Household, holders of Household common stock will be entitled to receive, pro
rata, after satisfaction in full of the prior rights of creditors and holders
of preferred stock, all of the remaining assets of Household available for
distribution.

Preferred Share Purchase Rights

In July 1996, Household entered into a Rights Agreement with Harris Trust
and Savings Bank, as Rights Agent. The Rights Agreement is intended to address
the threat of certain types of takeover activity deemed abusive and unfair to
stockholders and to assure that all stockholders receive fair and equal
treatment in the event of an unsolicited takeover of Household. The Rights
Agreement also enhances the bargaining position of the Household's Board of
Directors in negotiating on behalf of stockholders with potential acquirors of
Household. The Rights Agreement provides that attached to each share of
Household common stock is one right to purchase from Household one three-
thousandth of a share of Junior Preferred at a price of $100 per one three-
thousandth of a share, subject to adjustment. See "Junior Preferred" above.

Dividends

Household is principally a holding company whose primary source of funds is
cash received from its subsidiaries, primarily in the form of dividends and
borrowings under intercorporate agreements. Dividend distributions to Household
from its savings and loan, banking and insurance subsidiaries may be restricted
by federal and state laws and regulations. Dividend distributions from its
foreign subsidiaries may also be restricted by exchange controls of the country
in which the subsidiary is located. Also, as a holding company the rights of
any creditors or stockholders of Household 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 may itself be a creditor with recognized claims against the
subsidiary. Nevertheless, there are no restrictions that currently materially
limit Household's ability to make payments to its creditors or to pay dividends
on its preferred stock or Household common stock at current levels nor are
there any restrictions which Household reasonably believes are likely to limit
materially such payments in the future.

Special Charter Provisions

The Rights Agreement was adopted to address the threat of certain types of
takeover activity deemed abusive and unfair to stockholders and to assure that
all stockholders receive fair and equal treatment in the event of an
unsolicited takeover of Household. The Rights Agreement also enhances the
bargaining position of Household's Board of Directors in negotiating on behalf
of stockholders with potential acquirors of Household International.

The Household's Restated Certificate of Incorporation, as amended, contains
provisions, in accordance with Section 102(b)(7) of the Delaware General
Corporation Law, eliminating the personal liability of a director to Household
or its stockholders for money damages for breach of fiduciary duty as a
director, provided that the liability of a director may not be eliminated or
limited (i) for any breach of the directors' duty of loyalty to Household or
its stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
(relating to liability for
unauthorized acquisitions or redemption's of, or dividends on, capital stock)
of Delaware General Corporation Law, or (iv) for any transaction from which the
director derived an improper personal benefit.

50
<PAGE>

DESCRIPTION OF RENAISSANCE

General

Renaissance is an issuer and servicer of non-prime credit card accounts.
Renaissance was incorporated in Oregon in 1992 under the name "TL Holdings,
Inc." It is organized as a "thrift holding company." Since incorporation,
Renaissance has been privately held.

Renaissance has two wholly-owned subsidiaries: Orchard Federal Savings Bank
("OFSB") and Renaissance Bankcard Services, Inc. Renaissance issues its credit
cards through OFSB. Renaissance Bankcard Services wholly owns Renaissance
Bankcard Services of Kentucky, Inc., and both of these Renaissance entities
engage in the business of credit card account servicing.

Renaissance relies on three primary means of distribution. The three means
are (1) strategic partnerships with large financial institutions and retailers,
(2) direct marketing, and (3) subprime credit card account portfolio
acquisitions. Renaissance has built specialized account-management processes
and servicing platforms to optimize control and to enhance its direct marketing
and finance functions in the subprime credit card market. Subprime accounts are
generally defined as accounts held by individuals with low credit ratings.

Renaissance's principal executive offices are located 9400 SW Beaverton-
Hillsdale Hwy., Suite 300, Beaverton, Oregon 97005 and its telephone number is
(503) 245-5595.

Common Stock

No established public trading market exists for any class of Renaissance
shares. As of December 31, 1999 there are 62 holders of Renaissance common
stock, and one holder of each of Renaissance Class B Common Stock and
Renaissance Class C Common Stock. Since 1997 Renaissance has not declared or
paid dividends to any class of Renaissance common stock.

51
<PAGE>

Selected Financial Data

The following table sets forth selected consolidated financial information
of Renaissance as of and for the nine months ended September 30, 1999 and 1998
and as of and for the preceding five years ended December 31, 1998. The
statements of income and balance sheet data as of or for the years ended
December 31, 1998, 1997, and 1996 have been derived from Renaissance's audited
Consolidated Financial Statements and notes thereto. The statements of income
and balance sheet data as of or for the years ended December 31, 1995 and 1994
and the selected financial data for Renaissance for the nine months ended
September 30, 1999 and 1998 are unaudited but include, in the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation of such data. The results of
operations for the nine months ended September 30, 1999 are not necessarily
indicative of the results that may be expected for the year ending December 31,
1999. The information set forth below should be read in conjunction with
Renaissance's Consolidated Financial Statements and notes thereto which are
included in this Prospectus.

<TABLE>
<CAPTION>
At or For the Nine
Months Ended At or For the Year Ended December
September 30, 31,
-------------------- -------------------------------------
1999 1998 1998 1997 1996 1995 1994
--------- --------- ------ ------ ------ ------ -----
(In millions, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C>
Statement of Income Data
Finance income.......... $ 59.7 $ 23.1 $ 35.0 $ 18.3 $ 13.2 $ 17.1 $15.3
Other interest income... 3.8 2.8 3.8 3.2 2.8 3.0 2.3
Interest expense........ 11.1 6.8 9.5 7.0 5.0 10.3 7.9
--------- --------- ------ ------ ------ ------ -----
Net interest margin..... 52.4 19.1 29.3 14.5 11.0 9.8 9.7
Provision for credit
losses on owned
receivables............ 43.4 11.3 19.7 9.4 4.9 1.4 1.3
--------- --------- ------ ------ ------ ------ -----
Net interest margin
after provision for
credit losses.......... 9.0 7.8 9.6 5.1 6.1 8.4 8.5
--------- --------- ------ ------ ------ ------ -----
Securitization income... 3.7 4.9 5.3 2.6 4.3 -- --
Fee income.............. 57.4 17.5 30.7 12.3 6.5 8.1 7.3
Other income............ 1.9 0.4 0.5 (0.2) 0.2 0.3 --
--------- --------- ------ ------ ------ ------ -----
Total other revenues.... 63.0 22.8 36.5 14.7 11.0 8.4 7.3
--------- --------- ------ ------ ------ ------ -----
Total costs and
expenses............... 53.6 24.6 38.0 19.9 15.3 13.2 12.4
--------- --------- ------ ------ ------ ------ -----
Income (loss) before
income taxes(2)........ 18.4 6.0 8.1 (0.1) 1.8 3.6 3.4
Income tax expense
(benefit).............. 7.5 2.4 3.2 (0.5) 0.4 0.4 0.4
--------- --------- ------ ------ ------ ------ -----
Net income(5)........... $ 10.9 $ 3.6 $ 4.9 $ 0.4 $ 1.4 $ 3.2 $ 3.0
========= ========= ====== ====== ====== ====== =====
Per Common Share Data
Basic earnings.......... $ 1.71 $ .59 $ .79 $ .06 $ .27 $ .65 $ .61
Diluted earnings........ 1.12 .45 .61 .05 .22 .55 .52
Dividends declared...... -- -- -- .04 .04 .26 .35
========= ========= ====== ====== ====== ====== =====
Balance Sheet Data
Total assets:
Owned.................. $ 395.0 $ 189.8 $242.8 $152.7 $102.1 $ 63.0 $47.4
Managed................ 497.8 281.6 335.0 210.7 149.9 135.7 112.3
Owned receivables:
Credit card(1)......... $ 317.2 $ 136.8 $192.3 $106.5 $ 73.0 $ 16.7 $ 9.3
Mortgage loans secured
by real estate........ 9.0 6.7 7.2 5.9 4.0 4.7 5.1
Contract loans secured
by real estate........ 26.6 16.6 20.8 13.3 8.5 9.2 7.9
Other consumer loans... 1.5 1.2 1.4 0.7 0.2 0.2 0.1
--------- --------- ------ ------ ------ ------ -----
Total owned receivables. 354.3 161.3 221.7 126.4 85.7 30.8 22.4
Credit card receivables
securitized............ 51.0 51.0 51.0 39.5 39.5 39.5 --
Other credit card
receivables serviced
with recourse.......... 14.9 21.6 22.9 16.1 8.3 33.2 64.9
--------- --------- ------ ------ ------ ------ -----
Total receivables owned
and securitized or
serviced with
recourse .............. $ 420.2 $ 233.3 $295.6 $182.0 $133.5 $103.5 $87.3
Other credit card
receivables serviced
with limited recourse.. 36.9 19.2 18.3 2.4 -- -- --
--------- --------- ------ ------ ------ ------ -----
Total managed
receivables ........... $ 457.1 $ 252.5 $313.9 $184.4 $133.5 $103.5 $87.3
========= ========= ====== ====== ====== ====== =====
Average managed credit
card receivables....... $ 352.7 $ 188.8 $204.4 $132.8 $104.7 $ 81.8 $63.0
========= ========= ====== ====== ====== ====== =====
Average adjusted managed
credit card
receivables(4)......... $ 333.1 $ 171.8 $187.1 $131.3 $104.7 $ 81.8 $63.0
========= ========= ====== ====== ====== ====== =====
Deposits................ $ 325.1 $ 139.3 $180.6 $117.6 $ 72.4 $ 42.3 $28.2
Long-term debt and other
borrowings............. 10.4 19.5 18.7 17.5 18.0 10.2 7.7
Common shareholders'
equity................. 25.8 12.8 14.4 9.2 6.9 4.3 3.3
========= ========= ====== ====== ====== ====== =====
Selected Financial
Ratios
Return on average owned
assets(3).............. 3.42% 2.10% 2.48% 0.31% 1.70% 5.79% 6.91%
Return on average common
shareholders'
equity(3).............. 54.2% 32.7% 41.5% 5.0% 25.0% 84.2% 113.2%
Common equity to owned
assets................. 6.53% 6.74% 5.93% 6.02% 6.76% 6.83% 6.95%
========= ========= ====== ====== ====== ====== =====
</TABLE>

52
<PAGE>

- --------
(1) Credit card portfolio purchases of $46.4 million were made for the 9 months
ended September 30, 1999, $12.3 million in 1998, and $23.8 million in 1996.
(2) The pre-tax loss in 1997 was primarily due to increased charge-offs
associated with our credit card portfolios driven largely by industry
conditions.
(3) Averages were calculated using a two point average of beginning and ending
balances for the respective periods.
(4) Excludes managed receivables from which Renaissance does not share in net
interest margin ("Adjusted Managed Credit Card Receivables"). For the years
ended 1998, 1997, and 1996, the average outstanding balance consists of the
average daily balance for OFSB credit card receivables plus a two-point
average of the difference between the consolidated amount and the amount
related to OFSB. For 1995 and 1994 averages were calculated on a two-point
basis.
(5) During 1994 through 1996, RBS was a Sub S corporation, and accordingly paid
no taxes directly. Had RBS been a C corporation during these years,
proforma net income for 1997, 1996, 1995, and 1994 would have been ($0.1)
million, $1.0 million, $2.2 million, and $2.0 million respectively.

53
<PAGE>

Management's Discussion and Analysis of Financial Condition and Results of
Operations

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE "SELECTED
FINANCIAL DATA" AND THE "CONSOLIDATED FINANCIAL STATEMENTS OF RENAISSANCE",
INCLUDING THE RELATED NOTES THERETO INCLUDED HEREIN. CERTAIN STATEMENTS IN
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS" CONSTITUTE FORWARD-LOOKING STATEMENTS. SEE "SUMMARY--FORWARD-
LOOKING STATEMENTS."

Overview

Renaissance Holdings, Inc. ("Renaissance") was originally incorporated as TL
Holdings, Inc. in 1992, and until June 1997 was a thrift holding company whose
only asset was its ownership of Orchard Bank ("Orchard"), a federal savings
bank with retail operations in Ontario, Oregon. In June 1997, Renaissance
acquired the minority common stock ownership interest of third parties in
Orchard and, contemporaneously, through a reorganization in which each common
share of Renaissance Bankcard Services ("RBS") was exchanged for approximately
three common shares of Renaissance, acquired ownership of the capital stock of
RBS. RBS had operated independently of TL Holdings prior to the June 1997
reorganization, although the principal businesses of Orchard and RBS were
substantially interrelated. Since RBS and Renaissance had several common
shareholders and common management, the share exchange was treated as a
combination of entities under common control and, therefore, accounted for
similar to a pooling of interests. As a result, the consolidated financial
statements of Renaissance include the results of operations, financial position
and changes in cash flows of RBS for all periods. Renaissance may also be
referred to in this Management's Discussion and Analysis as "we," "us," or
"our."

Our principal business is the issuance and servicing of credit card loans to
consumers with credit ratings in the "non-prime" categories. Since inception,
we have grown our loan portfolio to over one million accounts. This growth has
come principally from three independent acquisition channels: partnership
arrangements with third party marketing partners, direct marketing of Orchard
Visa and MasterCard credit cards and portfolio acquisitions. RBS also has
servicing income related to accounts originated and owned by third party credit
card issuers. Orchard provides a complete range of banking services from its
Ontario, Oregon branches.

At September 30, 1999, our total managed credit card loan portfolio
consisted of approximately 927,000 accounts with an aggregate outstanding
balance of $420.0 million. Also, we have a portfolio of other consumer loans,
predominantly mortgage loans, which had an aggregate outstanding balance of
$37.1 million as of the above date.

Interest income consists of (i) interest income on outstanding revolving
credit card receivables, (ii) annual credit card fees, with annual fees being
amortized over the 12-month period to which such fees relate, (iii)
amortization of deferred acquisition costs, primarily origination fees paid to
third party agents, amortized over a 12-month period under Statement of
Financial Accounting Standards Number 91, "Accounting for Non-refundable Fees
and Costs Associated with Originating or Acquiring Loans and Initial Direct
Costs of Leases" ("SFAS 91"), (iv) interest and fee income on other loans,
primarily points on mortgages and real estate contracts and (v) income on
investments. Non-interest income includes (i) other credit card fees including
past-due, overlimit, cash advance and interchange fees, which are the portion
of the merchant fee assessed by MasterCard or Visa and passed on to us on the
purchase volume of our credit card receivables, (ii) securitization income, and
(iii) servicing income and fee-based product revenues and other income.
Interest Expense typically includes the costs of funding our receivables,
including interest payable on deposits, FHLB advances and other loans. Net
interest income after provision for loan losses is interest income, less
interest expense, and provision for loan losses. Non-interest expense typically
includes operating expenses, including employee compensation, data processing,
occupancy and servicing expenses and account solicitation and marketing
expenses.

54
<PAGE>

Impact of Credit Card Securitizations

In December 1995 and again in July 1998, we securitized pools of credit card
receivables. Effective January 1, 1997, we adopted Statement of Financial
Accounting Standards No. 125, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" ("Statement No. 125"). In
these transactions, we sold credit card receivable pools to a Master Credit
Card Trust, which in turn sold beneficial interests in the trust to investors.
Under Statement No. 125, we record gains on the sale (referred to as
"securitization") of credit card receivables to the extent that we receive
consideration in the sale other than beneficial interests in the transferred
receivables. We received in each of the two securitizations consideration equal
to cash plus an interest in the cash flows from the receivable pools, and
retained the responsibility to service the receivables for a fixed fee. The
cash flows to be received represent an "interest only" ("I/O") strip,
consisting of the present value of fees and finance charges from the
securitized receivables in excess of the sum of the return paid to the
investors, servicing fees, credit losses and other expenses associated with the
transaction. Because the benefits of servicing do not adequately compensate us
for performing the servicing, we also record a servicing liability at the time
of sale which reduces the gain on sale recorded. The I/O strips and servicing
liabilities are amortized, using the interest method, over the projected life
of the securitization. Certain estimates inherent in the determination of the
fair value of the I/O strip, including credit losses and payment rates, could
materially change in the near term. These estimates affect the reported amounts
of assets and liabilities as well as the reported amount of revenues and
expenses during the reporting period. At September 30, 1999 and 1998,
securitized receivables totaled $51.0 million. For the years ended December 31,
1998, 1997 and 1996, securitized receivables totaled $51.0, $39.5 and $39.5
million, respectively.

The credit quality of the securitized receivables is supported by credit
enhancement which, among other things, includes the subordination of our
retained interests in the receivables pool. The securitization results in the
removal of the receivables, other than our retained interests, from our balance
sheet for financial reporting purposes. In general, our current securitization
structure provides for the daily securitization of all new credit card
receivables arising under the securitized accounts.

Managed Loan Portfolio

The managed portfolio is composed of on balance sheet receivables,
securitized receivables, and receivables funded by third parties. We earn
servicing income and have limited recourse on some of the receivables funded by
third parties. We manage, review and analyze our financial performance on a
"managed loan" portfolio basis as if receivables securitized or funded by third
parties are on our balance sheet. In March 1999 and August 1998, we purchased
credit card portfolios with receivables totaling $46.4 and $12.3 million,
respectively, which were acquired at a discount. Charge-offs against the
acquired allowance on these portfolios totaled $8.3 and $0.8 million for the
nine months ended September 30, 1999 and the year ended December 31, 1998,
respectively.

55
<PAGE>

The following table indicates our net interest margin on a managed loan
basis (excluding receivables funded by others for which we have no interest
risk). The table also indicates the ending and average managed loans and the
number of managed accounts. Net interest income on a managed loan basis
includes net interest income on all outstanding loans less interest expense,
including the interest expense paid to investors in our securitizations.

Managed Credit Card Portfolio
(In thousands, except for percentages)

<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended Year Ended Year Ended Year Ended
September 30, September 30, December 31, December 31, December 31,
1999 1998 1998 1997 1996
------------- ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Period-end total managed
credit card
receivables............ $419,968 $227,989 $284,526 $164,512 $120,767
Period-end total managed
credit card accounts... 927 439 588 241 169
Total average adjusted
managed credit card
loan portfolio(1)...... $333,135 $171,837 $187,102 $131,319 $104,691
Net interest income on
managed credit card
loans(1)............... $ 55,901 $ 23,485 $ 34,891 $ 19,805 $ 14,417
Net interest income as a
percent of average
managed credit card
loans annualized(1).... 22.4% 18.2% 18.6% 15.1% 13.8%
</TABLE>
- --------
(1) Adjusted Managed Credit Card Receivables.

Net interest income as a percentage of average credit card loans has
continued to increase due to a shift in the credit card portfolio towards
unsecured low balance accounts for which we charge a higher annual fee to
compensate us for our risk.

Nine Months Ended September 30, 1999 Compared to Nine Months Ended September
30, 1998

Net income for the nine months ended September 30, 1999, was $10.9 million,
or 203% higher than net income of $3.6 million for the nine months ended
September 30, 1998. Interest income for the nine months ended September 30,
1999 was $63.5 million, an increase of 145% over interest income of $25.9
million for the nine month period ended September 30, 1998. The increase in
interest income was principally the result of increased fees and finance charge
revenue resulting from an increase in average Adjusted Managed Credit Card
Receivables. Average Adjusted Managed Credit Card Receivables for the nine
months ended September 30, 1999 amounted to 726,000 accounts and $333.1 million
of receivables, an increase of 142% and 94% respectively over 300,000 accounts
and $171.8 million of average Adjusted Managed Credit Card Receivables for the
nine months ended September 30, 1998. We generated our credit card growth
through acquisitions (21%), direct origination (51%) and partnerships with
third party marketers (28%). Interest expense for the nine months ended
September 30, 1999 amounted to $11.1 million, an increase of 65% over interest
expense of $6.8 million for the nine month period ended September 30, 1998. The
interest expense increase was principally the result of increased average
Adjusted Managed Credit Card Receivables. Non-interest income for the nine
months ended September 30, 1999, amounted to $63.0 million, or 176% higher than
the non-interest income of $22.8 million reported for the nine months ended
September 30, 1998. The increase in non-interest income, primarily credit card
fees, is directly attributable to our growth in credit card accounts and
receivables.

Our provision for loan losses for the nine months ended September 30, 1999
totaled $43.4 million, an increase of 282% over the provision of $11.3 million
recorded for the nine months ended September 30, 1998. The increase in our loss
provision reflects the increase in our managed loans. Non-interest expense for
the nine months ended September 30, 1999 was $53.6 million or 118% higher than
the non-interest expense of $24.6 million reported during the nine months ended
September 30, 1998. The increase in non-interest expense was

56
<PAGE>

due principally to increased staffing to handle the growth in our portfolio and
accompanying increased occupancy expense to house new staff, increased
operations and increased direct mail expense. Staffing levels at September 30,
1999 amounted to 733 full time equivalent positions, a 90% increase over the
staffing level at September 30, 1998.

1998 Compared to 1997

Net income for 1998 was $4.9 million compared to $0.4 million for 1997.
Interest income for 1998 amounted to $38.8 million, an increase of 80% over
interest income of $21.5 million reported for 1997. The interest income
increase was principally the result of increased fees and finance charge
revenue resulting from an increase in average Adjusted Managed Credit Card
Receivables. Average Adjusted Managed Credit Card Receivables for the year
ended December 31, 1998 amounted to 355,000 accounts and $187.1 million of
receivables, an increase of 81% over the accounts and 43% over the $131.3
million of average Adjusted Managed Credit Card Receivables for the year ended
December 31, 1997. Approximately 61% of receivables growth in 1997 was
attributable to direct originations, 12% to acquisitions and 27% to
partnerships with third party marketers. Interest expense for 1998 amounted to
$9.5 million, an increase of 35% over 1997. The interest expense increase was
principally the result of increased average Adjusted Managed Credit Card
Receivables. Non-interest income for 1998 amounted to $36.5 million, or 149%
higher than the $14.7 million of non-interest income reported for 1997. The
increase in non-interest income, primarily credit card fees and securitization
income, is directly attributable to our growth in our managed credit card
accounts and receivables.

Our provision for loan losses for the year ended December 31, 1998 totaled
$19.7 million, an increase of 109% over the $9.4 million provision recorded for
the year ended December 31, 1997, reflecting the increase in our managed loans.
Non-interest expense for the year 1998 amounted to $38.0 million, or 90% higher
than the non-interest expense of $19.9 million recorded for the year 1997. The
increase in non-interest expense was due principally to increased staffing to
handle the growth in our portfolio and accompanying increased occupancy expense
to house new staff, increased operations and increased direct mail expense.
Staffing levels at December 31, 1998 amounted to 453 full time equivalent
positions, a 58% increase over the staffing level at December 31, 1997.

1997 Compared to 1996

Net income for 1997 was $0.4 million compared to $1.4 million for 1996.
Interest income for 1997 amounted to $21.5 million, an increase of 34% over
interest income of $16.0 million reported for 1996. Net income fell in 1997 due
to increased charge-offs on credit card receivables. The interest income
increase was principally the result of increased fees and finance charge
revenue resulting from an increase in average Adjusted Managed Credit Card
Receivables. Average Adjusted Managed Credit Card Receivables for the year
ended December 31, 1997 amounted to 196,000 accounts and $131.3 million of
receivables, an increase of 25% over the accounts and 25.4% over the $104.7
million of average Adjusted Managed Credit Card Receivables for the year ended
December 31, 1996. Approximately 70% of receivables growth in 1997 was
originated through partnerships with third party marketers. Interest expense
for 1997 amounted to $7.0 million, an increase of 39% over 1996. The interest
expense increase was principally the result of increased average Adjusted
Managed Credit Card Receivables. Non-interest income for 1997 amounted to $14.7
million, or 33% higher than the $11.0 million of non-interest income reported
for 1996. This increase was primarily associated with higher servicing income.

Our provision for loan losses for the year ended December 31, 1997 totaled
$9.4 million, an increase of 91% over the provision of $4.9 million recorded
for the year ended December 31, 1996, reflecting the increase in our managed
loans, as well as increased charge-offs. Non-interest expense for 1997 amounted
to $19.9 million, or 31% higher than the non-interest expense of $15.3 million
recorded for the year ended December 31, 1996. The increase in administrative
expense was due principally to increased staffing to handle the growth in our
portfolio and accompanying increased occupancy expense to house new staff and
increased operations. Staffing levels at December 31, 1997 amounted to 287 full
time equivalent positions, a 55% increase over the

57
<PAGE>

staffing level at December 31, 1996. Income tax benefit for 1997 amounted to
$0.5 million compared to income tax expense of $0.4 million in 1996. This
decrease was principally due to our decreased taxable income and the conversion
of RBS from an S Corporation to a wholly-owned subsidiary of Renaissance.

Asset Quality

Our delinquency and net loan charge-off rates at any point in time reflect,
among other factors, the credit risk of receivables, the average age of our
credit card accounts, the timing of portfolio purchases, the success of our
collection and recovery efforts and general economic conditions. The average
age of our credit card account portfolio affects the stability of delinquency
and loss rates of the portfolio. Our strategy for managing delinquency and loan
losses consists of active account management throughout the client
relationship. This strategy includes credit line management and risk-based
pricing so that we maintain an acceptable profit margin based on the risk of
the credit card accounts.

Delinquencies

Delinquencies have the potential to impact earnings in the form of higher
provision for loss. Delinquencies are also costly in terms of the personnel and
resources dedicated to resolving them. A credit card account is contractually
delinquent if the minimum payment is not received by the specified date on the
customer's statement. It is our policy to continue to accrue interest and fee
income on all credit card accounts, except in limited circumstances, until the
account and all related loans, interest and other fees are charged off. See "--
Net Charge-Offs." The following table presents the delinquency trends of our
credit card receivables portfolio on a managed loan portfolio basis:

Managed Credit Card Contractual Delinquency Ratio
(In thousands, except for percentages)

<TABLE>
<CAPTION>
At
September 30, At At At At
1999 September 30, 1998 December 31, 1998 December 31, 1997 December 31, 1996
------------- ------------------- ------------------ ------------------ ------------------
% of % of % of % of % of
Loans Delinquent: Amount Total Amount Total Amount Total Amount Total Amount Total
----------------- ------- ----- ---------- -------- ------------------ ------------------ ------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
30 to 59 days........... $14,318 3.4% $ 7,095 3.1% $ 8,413 3.0% $ 5,639 3.4% $ 3,902 3.2%
60 to 89 days........... $11,291 2.7% $ 5,001 2.2% $ 5,741 2.0% $ 2,366 1.4% $ 2,382 2.0%
90 or more.............. $26,203 6.2% $ 8,688 3.8% $ 12,798 4.5% $ 4,669 2.8% $ 3,762 3.1%
Total 30 or more........ $51,812 12.3% $ 20,784 9.1% $ 26,952 9.5% $ 12,674 7.7% $ 10,046 8.3%
Total 60 or more........ $37,494 8.9% $ 13,689 6.0% $ 18,539 6.5% $ 7,035 4.3% $ 6,144 5.1%
</TABLE>

Net Charge-offs

Net charge-offs include the principal and billed finance charges and fees
from customers unwilling or unable to pay their loan balance, as well as
bankrupt and deceased customers, less current period recoveries. We generally
charge off loans during the period in which the loan becomes contractually 180
days past due. However, bankrupt accounts, fraudulent accounts and the accounts
of deceased customers without a surviving, contractually liable individual or
an estate large enough to pay the debt in full are charged off immediately upon
notification of the customer's bankruptcy or death or identification of the
fraud. The following table presents our net charge-offs for the periods
indicated on a managed loan portfolio basis:

Managed Credit Card Net Charge-off Ratios
(In thousands, except for percentages)

<TABLE>
<CAPTION>
Nine Months Nine Months
Ended Ended Year Ended Year Ended Year Ended
September 30, September 30, December 31, December 31, December 31,
1999 1998 1998 1997 1996
------------- ------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Average managed credit
card loans
outstanding(/1/)....... $333,135 $171,837 $187,102 $131,319 $104,691
Net charge-offs(/1/).... $ 39,692 $ 14,389 $ 20,544 $ 14,733 $ 8,350
Net charge-offs as an
annualized percentage
of average managed
credit card loans(/1/). 15.9% 11.2% 10.9% 11.2% 8.0%
</TABLE>
- --------
Note: Net charge-offs presented in the above table include accrued interest and
fees.
(1) Excludes managed loans for which Renaissance does not have risk of charge-
off.

58
<PAGE>

Credit Loss Reserves

For securitized receivables, anticipated losses are reflected in the
calculations of net securitization income. For loans maintained on our balance
sheet, provisions for loan losses are made in accordance with Statement of
Financial Accounting Standards No. 5 ("Statement No. 5"), which requires
provisions in amounts necessary to maintain the allowance at a level estimated
to be sufficient to absorb probable future losses of principal and accrued fees
and finance charges, net of recoveries (including recovery of collateral, if
applicable). In evaluating credit losses, we take into consideration several
factors, including (i) historical charge-off and recovery activity by
receivables portfolio, (ii) recent and expected delinquency and collection
trends by receivables portfolio, (iii) the risk characteristics of the
portfolios and (iv) indemnifications against losses from third parties such as
marketing partners. Over the past few years, our loss reserve balances have
grown reflecting the growth in our credit card portfolio as well as the
seasoning of our receivables. Owned loss reserve balances including non-credit
card were $43.2 million at September 30, 1999 and $18.8, $8.3 and $6.2 million
at December 31, 1998, 1997 and 1996, respectively. Loss reserve estimates are
reviewed periodically and adjustments are reported in earnings when they become
known.

In 1998, we changed the way we estimate our allowance for loan losses. The
change was made to better reflect the timing of the recognition of credit card
losses with events which indicated the potential for loss has occurred. In
addition, this method of estimation is used by many members of our industry
peer group. The accounting treatment previously used to determine the allowance
for credit card losses was in accordance with generally accepted accounting
principles. Had we determined the allowance for loan losses in 1998 based on
the previous methodology, the allowance would have been $22.4 million at
December 31, 1998. Net income would have been reduced by $2.3 million resulting
in net income of $2.6 million for the year ended December 31, 1998.

The following table sets forth the owned credit loss reserves for the
periods indicated:

<TABLE>
<CAPTION>
At At
All dollar amounts are September 30, September 30, Year Year Year Year Year
stated in millions. 1999 1998 1998 1997 1996 1995 1994
- ---------------------- ------------- ------------- ----- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Owned credit loss
reserves............... $43.2 $15.0 $18.8 $8.3 $6.2 $1.4 $1.4
Reserves as a % of owned
receivables............ 12.19% 9.30% 8.48% 6.57% 7.23% 4.54% 6.25%
</TABLE>

Interest Rate Sensitivity

Interest rate risk refers to the vulnerability of an institution's financial
condition to movements in interest rates. Although interest rate risk is a
normal part of financial intermediation, excessive interest rate risk poses a
significant threat to an institution's earnings and capital. Changes in
interest rates affect an institution's earnings by altering interest-sensitive
income and expenses. Changes in interest rates also affect the underlying value
of an institution's assets, liabilities and off-balance sheet instruments
because the present value of future cash flows change when interest rates
change.

A significant amount of our funding comes from fixed rate certificates of
deposit whose maturities range from less than 1 year to more than 5 years.
Because our credit card receivables have variable rate pricing, structural
interest rate risk exists. We do not enter into interest rate swaps or other
derivative instruments to synthetically alter the terms of our assets or
liabilities.

Simulation models are used to estimate the impact that changes in interest
rates will have on our net interest income and fair value of equity. Key
assumptions include the rate at which we expect our loans to pay off, loan
volumes and pricing, and changes in market conditions. Even though the
assumptions we use are based on our best estimates of actual conditions, the
model cannot precisely predict the actual impact of interest rate changes
because of the high level of uncertainty inherent in the assumptions. At
December 31, 1998, we estimated that our net interest income would increase by
$3.1 million over a twelve month period following a

59
<PAGE>

200 basis point shock increase and would increase $0.5 million over a twelve
month period following a 200 basis point shock decline in interest rates.

Liquidity, Funding and Capital Resources

Liquidity is measured by a company's ability to raise cash when needed
without adversely impacting profits. We have a number of obligations to meet
with our available cash. We must be able to service our debt and meet the
capital needs of our subsidiaries. We must also be capable of meeting all
obligations to our Orchard customers including immediate deposit withdrawal
requirements, funding lines and letters of credit, and fulfilling credit
needs.

We also invest cash in investment securities. As of September 30, 1999 and
1998 our investment security portfolio totaled $7.6 and $11.2 million,
respectively. As of December 31, 1998, 1997 and 1996 our investment security
portfolio totaled $10.8, $11.3 and $16.3 million, respectively. Substantially
all of our investments were in US Government mortgage backed securities.
Investment securities at December 31, 1996 included approximately $5.0 million
in US Treasury Bills.

We strive to maintain an amount of liquidity that is most efficient given
our overall economic situation. We recognize that due to the nature of the
credit card industry and the contingent liability that credit cards possess,
that proper liquidity and cash flow management is critical to our operations.
Consequently, we have a contingency liquidity plan that has been approved by
the Board of Directors and cash flow management procedures that provide
adequate assurance that funding sources are available to meet the demands of
our customers. In addition, we use national deposits extensively for funding
that are not withdrawable unless the depositor dies or is declared insane.
This improves the liquidity position of Orchard by reducing early withdrawals
of deposits.

At September 30, 1999 and 1998, securitized receivables totaled $51.0
million. At December 31, 1998, 1997 and 1996 securitized receivables totaled
$51.0, $39.5 and $39.5 million, respectively. The on-balance sheet portion of
our remaining receivables and loans were funded using secured, retail (branch
based), and nationally brokered deposits. Of total deposits at September 30,
1999, secured deposits comprised $13 million or 4% of our total deposits while
retail and nationally brokered deposits were $31 million or 10% and $281
million or 86% respectively. The efficiency of the national market has made
this funding avenue very attractive to us during the past several years.
Additionally, approximately $10.4 million of funding was obtained from third
party notes.

Information on our deposit portfolio is as follows:

<TABLE>
<CAPTION>
At December 31,
---------------------------------------
1998 1997
------------------- -------------------
Weighted Weighted
Average Average
Amount Rate Amount Rate
---------- -------- ---------- --------
All dollar amounts are stated in
thousands.
<S> <C> <C> <C> <C>
Demand accounts....................... $ 6,003.7 1.58% $ 4,724.9 2.02%
Savings accounts...................... 15,259.7 3.09 10,477.1 3.20
Certificates of deposit accounts...... 159,370.7 5.72 102,397.8 6.06
---------- ---- ---------- ----
Total deposits...................... $180,634.1 5.36% $117,599.8 5.65%
========== ==== ========== ====
</TABLE>

Average deposits and related weighted average interest rates for 1998, 1997
and 1996 were as follows:

<TABLE>
<CAPTION>
1998 1997 1996
------------------- ------------------ ------------------
Weighted Weighted Weighted
Average Average Average Average Average Average
Deposits Rate Deposits Rate Deposits Rate
---------- -------- --------- -------- --------- --------
All dollar amounts are stated in thousands.
<S> <C> <C> <C> <C> <C> <C>
Demand accounts......... $ 5,447.2 1.50% $ 3,259.2 2.01% $ 1,948.2 1.88%
Savings accounts........ 7,411.1 2.55 8,990.3 3.33 7,098.3 3.94
Certificates of deposit
accounts............... 114,566.8 6.14 74,723.3 6.24 47,200.5 6.27
---------- ---- --------- ---- --------- ----
Total deposits...... $127,425.1 5.74% $86,972.8 5.78% $56,247.0 5.83%
========== ==== ========= ==== ========= ====
</TABLE>

60
<PAGE>

Maturities of certificates of deposits in amounts of $100,000 or more were:

<TABLE>
<CAPTION>
At December 31, 1998 Domestic Deposits
-------------------- -------------------------------------------
All dollar amounts are stated in thousands.
<S> <C>
3 months or less............. $ 1,021.4
Over 3 months through 6
months...................... 101.7
Over 6 months through 12
months...................... --
Over 12 months............... 133,657.3
----------
Total $134,780.4
==========
</TABLE>

Contractual maturities of certificates of deposits within each interest rate
range were as follows:

<TABLE>
<CAPTION>
At December 31, 1998 1999 2000 2001 2002 2003 Thereafter Total
-------------------- --------- --------- ----------- ----------- ----------- ---------- ----------
All dollar amounts are stated in thousands.
<S> <C> <C> <C> <C> <C> <C> <C>
< 4.00%................. $ 29.8 $ 82.8 $ -- $ -- $ -- $ -- $ 112.7
4.00% - 5.99%........... 20,049.4 11,034.6 26,530.3 15,804.7 50,126.7 4,149.0 127,694.6
6.00% - 7.99%........... 11,538.1 11,803.9 1,298.0 3,136.1 -- 1,787.3 29,563.4
8.00% - 9.99%........... 1,000.0 -- -- -- -- 1,000.0 2,000.0
--------- --------- ----------- ----------- ----------- ---------- ----------
Total $32,617.3 $22,921.3 $ 27,828.3 $ 18,940.8 $ 50,126.7 $ 6,936.3 $159,370.7
========= ========= =========== =========== =========== ========== ==========
</TABLE>

Orchard is subject to various regulatory capital requirements administered
by the federal banking agencies. Failure to meet minimum requirements can
initiate certain mandatory, and possibly additional discretionary, actions by
regulators that, if undertaken, could have a direct material effect on our
financial statements. Under capital adequacy guidelines and the regulatory
framework for prompt corrective action, Orchard must meet specific capital
guidelines that involve quantitative measures of its assets, liabilities and
certain off-balance-sheet items as calculated under regulatory accounting
practices. Orchard's capital amounts and classifications are also subject to
qualitative judgments by the regulators about components, risk weightings and
other factors.

OTS regulations require Orchard to maintain liquid assets at least equal to
4% of the sum of its average daily balance of net withdrawable accounts and
borrowed funds due in one year or less (Orchard at its option may exclude
withdrawable accounts maturing in more than one year). Liquidity is monitored
on a daily basis through cash flow management procedures.

Orchard is subject to the capital adequacy guidelines of the OTS. At
December 31, 1998, the leverage, tier I and total risk-based capital ratio
levels for a "well capitalized" institution were 5.0, 6.0 and 10.0 percent,
respectively. Orchard's ratios for each of these categories at December 31,
1998 were 8.0, 9.5 and 10.4 percent, respectively. As of September 30, 1999,
Orchard met all capital adequacy requirements to which it is subject for a well
capitalized institution.

During the first nine months of 1999, we incurred approximately $9.1 million
in capital expenditures, predominantly related to construction of the London,
Kentucky servicing center including equipment associated with the build out and
other equipment purchases commensurate with our growth.

Year 2000

The Year 2000 Problem is a result of some computer programs and embedded
microchips using two digit years instead of four digits. As a result, at the
turn of century, the two digit approach could produce problems if systems
interpret "00" to mean "1900" instead of "2000". The Year 2000 Problem may
affect not only our software systems, but also critical software used by
suppliers of goods and services and financial institutions

61
<PAGE>

with which we do business. We have created a year 2000 project team to
identify, address and monitor internal systems and vendor issues related to the
Year 2000 Problem. We have tested all internally developed information and
operational critical systems, including hardware, software, and systems
interfaces, for year 2000 compliance. Where necessary, we have converted such
systems to a format that we believe will assure system and data integrity in
the year 2000 and thereafter. Although we believe we have completed all of our
critical internal system modifications, unforeseen problems could arise in the
year 2000 giving rise to delays and malfunctions which may impact our results
of operations. In addition, we continue to discuss with outside critical third
party providers of services, systems and networks whether these outside vendors
have satisfactorily addressed their year 2000 systems issues.

Our most critical outside vendors have provided information regarding their
year 2000 readiness efforts. These vendors have warranted the accuracy and
reliability of systems, reports, and data related to the performance of the
services provided by them and their affiliates in relation to the year 2000
issue. Due to its critical nature, we have participated in the year 2000
testing of our credit card processor, Total Systems Services, Inc. ("TSYS"),
during the first two quarters of 1999. Although we are taking these and other
precautionary measures to assure that we are not vulnerable to failure by our
third party vendors to make necessary system modifications, there can be no
assurance that our third party vendors will successfully address all of their
year 2000 issues. We have contingency plans that include, but are not limited
to, identification and replacement of critical products or services as
appropriate, in the event of vendor or software non-compliance. We believe that
we have adequate resources to achieve year 2000 compliance for any of our
systems which are found to be non-compliant.

Our costs associated with the year 2000 issue relate primarily to the
management of vendor project plans, replacement of non-compliant systems, and
participation in testing. If we determine that our non-information technology
systems and office equipment will not be year 2000-compliant, then we will
incur the replacement
cost of those systems. We are currently preparing cost estimates of those
systems. However, we do not believe that these costs will have a material
impact on our results of operations or financial condition. The majority of the
products we use are either year 2000-compliant at present or can be replaced
with a year 2000-compliant product or vendor at costs not materially different
from current costs. TSYS has an extensive plan to develop and test its systems
for compliance. However, any failure by TSYS to fully remediate our Year 2000
Problem could have a material adverse effect on us. As such, we continue to be
proactive in the monitoring of TSYS' year 2000 project plans.

62
<PAGE>

Net Interest Margin--1998 Compared to 1997

<TABLE>
<CAPTION>
Finance and
Interest
Average Average Income/Interest
Outstanding(2) Rate Expense Increase/(Decrease) Due to:
--------------------- ---------- ------------------- ----------------------------------
Volume Rate
1998 1997 1998 1997 1998 1997 Variance Variance(3) Variance(3)
---------- ---------- ---- ---- --------- --------- --------- ----------- -----------
All dollar amounts are stated in thousands.
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Receivables:
Credit Card............ $123,667.9 $ 78,377.7 28.3% 23.4% $34,952.9 $18,359.9 $16,593.0 $12,179.4 $4,413.6
Other.................. 21,991.8 15,366.2 11.1 12.0 2,445.2 1,844.9 600.3 747.0 (146.7)
---------- ---------- ---- ---- --------- --------- --------- --------- --------
Total receivables.... 145,659.7 93,743.9 25.7 21.6 37,398.1 20,204.8 17,193.3 12,804.6 4,388.7
Other interest-earning
assets................. 11,731.4 11,942.9 12.0 11.2 1,408.3 1,337.3 71.0 (23.9) 94.9
---------- ---------- ---- ---- --------- --------- --------- --------- --------
Total interest-earning
assets................. 157,391.1 105,686.8 24.7% 20.4% $38,806.4 $21,542.1 $17,264.3 $12,065.7 $5,198.6
Other assets............ 12,734.6 11,648.7
---------- ----------
Total assets......... $170,125.7 $117,335.5
========== ========== ==== ==== ========= ========= ========= ========= ========
Debt:
Deposits............... $127,425.1 $ 86,972.8 5.7% 5.8% $ 7,310.4 $ 5,025.3 $ 2,285.1 $ 2,371.1 $ (86.0)
Advances from Federal
Home Loan Bank........ 3,758.4 7,354.2 6.2 6.8 234.1 497.8 (263.7) (223.4) (40.3)
Notes payable.......... 10,587.1 9,213.7 18.3 16.0 1,935.5 1,478.4 457.1 232.7 224.4
---------- ---------- ---- ---- --------- --------- --------- --------- --------
Total debt........... 141,770.6 103,540.7 6.7% 6.8% $ 9,480.0 $ 7,001.5 $ 2,478.5 $ 2,582.7 $ (104.2)
Other liabilities....... 19,394.5 6,685.4
---------- ----------
Total liabilities....... 161,165.1 110,226.1
Shareholders' equity.... 8,960.6 7,109.4
---------- ----------
Total liabilities and
shareholders'
equity.............. $170,125.7 $117,335.5
========== ========== ==== ==== ========= ========= ========= ========= ========
Net interest margin--
owned basis (1)........ 18.6% 13.8% $29,326.4 $14,540.6 $14,785.8 $ 9,483.0 $5,302.8
==== ==== ========= ========= ========= ========= ========
Interest spread--owned
basis(4)............... 18.0% 13.6%
==== ====
</TABLE>

- --------
(1) Represents net interest margin as a percent of average interest-earning
assets.
(2) Nonaccrual loans are included in average outstanding balances. The average
outstanding balance consists of the average daily balance for OFSB assets
and liabilities plus a two-point average of the difference between the
consolidated amount and the amount related to OFSB.
(3) Rate/volume variance is allocated based on the percentage relationship of
changes in volume and changes in rate for the total interest variance. For
total receivables, total interest-earning assets and total debt, the rate
and volume variances are calculated based on the relative weighting of the
individual components comprising these totals. These totals do not
represent an arithmetic sum of the individual components.
(4) Represents the difference between the yield earned on interest-earning
assets and the cost of the debt used to fund the assets.

63
<PAGE>

Net Interest Margin--1997 Compared to 1996

<TABLE>
<CAPTION>
Finance and
Interest
Average Average Income/Interest
Outstanding(2) Rate Expense Increase/(Decrease) Due to:
-------------------- ---------- ------------------- ---------------------------------
Volume Rate
1997 1996 1997 1996 1997 1996 Variance Variance(3) Variance(3)
---------- --------- ---- ---- --------- --------- -------- ----------- -----------
All dollar amounts are stated in thousands.
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Receivables:
Credit Card............ $ 78,377.7 $43,071.6 23.4% 30.7% $18,359.9 $13,222.8 $5,137.1 $8,856.4 $(3,719.3)
Other.................. 15,366.2 12,320.3 12.0 12.2 1,844.9 1,506.1 338.8 363.9 (25.1)
---------- --------- ---- ---- --------- --------- -------- -------- ---------
Total receivables.... 93,743.9 55,391.9 21.6 26.6 20,204.8 14,728.9 5,475.9 8,663.2 (3,187.3)
Other interest-earning
assets................. 11,942.9 14,325.4 11.2 9.3 1,337.3 1,335.4 1.9 (243.4) 245.3
---------- --------- ---- ---- --------- --------- -------- -------- ---------
Total interest-earning
assets................. 105,686.8 69,717.3 20.4% 23.0% $21,542.1 $16,064.3 $5,477.8 $7,467.0 $(1,989.2)
Other assets............ 11,648.7 11,740.0
---------- ---------
Total assets......... $117,335.5 $81,457.3
========== ========= ==== ==== ========= ========= ======== ======== =========
Debt:
Deposits............... $ 86,972.8 $56,247.0 5.8% 5.8% $ 5,025.3 $ 3,277.4 $1,747.9 $1,747.9 $ --
Advances from Federal
Home Loan Bank........ 7,354.2 $ 9,613.7 6.8 6.8 497.8 651.7 (153.9) (153.9) --
Notes payable.......... 9,213.7 4,458.0 16.0 24.7 1,478.4 1,099.8 378.6 867.8 (489.2)
---------- --------- ---- ---- --------- --------- -------- -------- ---------
Total debt........... 103,540.7 70,318.7 6.8% 7.2% $ 7,001.5 $ 5,028.9 $1,972.6 $2,268.4 $ (295.8)
Other liabilities....... 6,685.4 4,971.2
---------- ---------
Total liabilities....... 110,226.1 75,289.9
Shareholders' equity.... 7,109.4 6,167.4
---------- ---------
Total liabilities and
shareholders'
equity.............. $117,335.5 $81,457.3
========== ========= ==== ==== ========= ========= ======== ======== =========
Net interest margin--
owned basis (1)........ 13.8% 15.8% $14,540.6 $11,035.4 $3,505.2 $5,198.6 $(1,693.4)
==== ==== ========= ========= ======== ======== =========
Interest spread--owned
basis(4)............... 13.6% 15.8%
==== ====
</TABLE>

64
<PAGE>

Analysis of Credit Loss Reserve Activity--Owned Receivables

<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------------------------
1998 1997 1996 1995 1994
---------- ---------- ---------- ---------- --------
In thousands.
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning allowance for
losses................. $ 8,252.9 $ 6,211.5 $ 1,410.3 $ 1,418.3 $1,035.7
Provision for loan
losses................. 19,658.5 9,388.6 4,908.0 1,401.2 1,287.3
Loss allowance acquired
through purchase of
portfolios............. 6,238.0 190.0 5,699.0 -- --
Charge-offs............. (17,493.4) (8,835.2) (6,469.8) (1,499.7) (959.3)
Recoveries.............. 2,135.2 1,298.0 664.0 90.5 54.6
---------- ---------- ---------- ---------- --------
Ending allowance for
credit card losses..... $ 18,791.2 $ 8,252.9 $ 6,211.5 $ 1,410.3 $1,418.3
========== ========== ========== ========== ========
</TABLE>

65
<PAGE>

Management of Renaissance

The following table sets forth certain information about the executive
officers and directors of Renaissance, as well as certain other members of its
senior management and of the individuals nominated to become directors of RCS,
and their ages and positions as of November 30, 1999.

<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Irving J. Levin 48 Chairman; President; and Chief Executive Officer;
Director nominee (of Renaissance Credit Services)
Charles B. Engelberg 45 Senior Vice-President; Chief Financial Officer
Ruth M. Scherbarth 71 Senior Vice-President
Karen D. Frolich 42 Senior Vice-President
George F. Alexander 61 Director; Executive Vice-President
E. Lenice Shaw 41 Vice-President; Controller
Neil Goldschmidt 59 Director
Frank Martucci 51 Director
Kenneth M. Novack 53 Director
K. Shelly Porges 46 Director
S.N. Mehta 41 Director nominee (of Renaissance Credit Services)
Randall L. Raup 46 Director nominee (of Renaissance Credit Services)
</TABLE>

Irving J. Levin: Mr. Levin is the founder and Chief Executive Officer of
Renaissance. He is Chairman of Orchard Bank and President, Chief Executive
Officer, and Chairman of the board of directors of Renaissance Bankcard
Services. He is the founder of the first CEBA bank, First Consumers National
Bank and has also been a senior consultant with Arthur D. Little, Inc. and a
manager with Visa. Mr. Levin has served as a director of Renaissance since
1992. Mr. Levin is nominated to become a director of Renaissance Credit
Services.

Charles B. Engelberg: Mr. Engelberg is Renaissance's and Renaissance
Bankcard Service's Chief Financial Officer and Senior Vice-President. He also
sits on the board of directors of Renaissance Bankcard Services. Prior to
joining Renaissance, he spent thirteen years with NERCO, Inc., a leading
natural resources company, where he held various senior-level positions in
Finance, External Affairs and General Management. Mr. Engelberg joined
Renaissance in 1994.

Karen D. Frolich: Ms. Frolich is a Senior Vice-President of Renaissance,
Chief Executive Officer of Orchard Federal Savings Bank, and a director of
Orchard Federal Savings Bank. Ms. Frolich has over twenty years experience in
the banking industry that provides a foundation for the many successful credit
card programs she has designed and managed at US Bank, First Consumers National
Bank and with RHI. Ms. Frolich has been with Renaissance since 1991.

George F. Alexander: As Executive Vice President of Renaissance and of
Renaissance Bankcard Services, Mr. Alexander holds corporate responsibility for
creating and managing operational growth strategies, as well as managing the
credit card processing platform. Mr. Alexander was part of the team that
started the first CEBA credit card bank and has held senior management
positions within the credit card businesses of Citicorp and Bank of America.
Mr. Alexander joined RHI in 1991. Mr. Alexander has served as a director of
Renaissance since 1997.

E. Lenice Shaw: Ms. Shaw has been Vice President and Controller of
Renaissance since 1996. She is a CPA and has over 18 years experience in
Finance and Accounting. Previously she was the Vice President and Controller of
Marketing One, an annuity marketer and broker-dealer. She was also with NERCO,
Inc. for ten years, principally directing financial analysis and planning
functions. Ms. Shaw is also the Vice-President and Controller for Renaissance
Bankcard Services and for Renaissance Bankcard Services of Kentucky. She
additionally sits on the board of directors of Renaissance Bankcard Services of
Kentucky.

66
<PAGE>

Ruth M. Scherbarth: Ms. Scherbarth has been Senior Vice President for
Renaissance since 1991. She is also a director and President of Renaissance
Bankcard Services of Kentucky and a Senior Vice-President of Renaissance
Bankcard Services. She has over twenty-five years experience in the credit card
industry. She has managed card operations for Citicorp, Diners Club, Bank of
America and First Consumers National Bank in the issuer and acquirer
environments.

Neil Goldschmidt: Mr. Goldschmidt is President of his own consulting firm
and has served as a director of Renaissance since 1997. He has also served as a
member of the Renaissance board of directors Compensation Committee since 1999,
and he is also Co-Chair of its Audit Committee. Mr. Goldschmidt also sits on
the board of directors of Analogy, Inc.

Frank Martucci: Mr. Martucci has served as a director of Renaissance since
1999. He is the President of Millcross High Yield Fund L.P. and sits on the
board of directors of Garan, Inc.

Kenneth M. Novack: Mr. Novack is President of Schnitzer Group, which is an
owner and operator of ocean-going ships and a real estate owner and developer.
He has served as a director of Renaissance since 1997. He has served as the
Chair of the Renaissance board of directors Compensation Committee since 1999
and as Co-Chair of the Renaissance board of directors Audit Committee since
1999. Mr. Novack also sits on the boards of directors of Schnitzer Steel
Industries, Inc. and of North of England Protection and Indemnity Association
(UK), Ltd.

K. Shelly Porges: Ms. Porges is an Executive Vice-President of Marketing
with Third Age Media. She was also an Executive Vice-President of Strategic
Marketing for The Money Store and has performed consulting services for
Porges/Hudson Marketing, of which she was founder and Chief Executive Officer.
Ms Porges also sits on the board of directors of Pueblo Corporation. Ms. Porges
has served as a director of Renaissance since 1998.

S.N. Mehta: Mr. Mehta is nominated to become a director of Renaissance
Credit Services. He is Group Executive of Household in charge of Household's
domestic MasterCard and Visa business. Before joining Household, Mr. Mehta was
a senior vice president of The Boston Consulting Group ("BCG"). He also was a
senior member of their Financial Services Practice.

Randall L. Raup: Mr. Raup is nominated to become a director of Renaissance
Credit Services. He is acting Chief Financial Officer of Household's domestic
MasterCard and Visa business. He previously served Household in several
capacities including most recently as Managing Director--Strategy and
Development.

Each Renaissance director holds office until the next annual meeting of
Renaissance shareholders. Each officer serves at the discretion of the
Renaissance board of directors and holds office until his or her successor is
elected and qualified or until his or her earlier death, resignation or
removal. There are no family relationships among any of the directors or
executive officers of Renaissance.

Executive Compensation

The following table sets forth all compensation awarded, earned, or paid for
services rendered in all capacities to Renaissance during each of 1996, 1997
and 1998 to Renaissance's Chief Executive Officer and the four most highly
compensated executive officers who received annual compensation in excess of
$100,000. There are no additional individuals for whom disclosure would have
been required pursuant to Item 402(a)(3) of Regulation S-K but for the fact
that any individual was not serving as an executive officer on December 31,
1998. Renaissance does not grant stock appreciation rights but has long-term
compensation benefits in the form of stock options, a Management Incentive
Plan, profit sharing and bonuses.

67
<PAGE>

Summary Compensation Table

<TABLE>
<CAPTION>
Annual Compensation
(1) ($)
-------------------
Other Annual
Name and Principal Position Year Salary (2) Bonus (3) Compensation (4)
- --------------------------- ---- --------- -------- ---------------

<S> <C> <C> <C> <C>
Irving J. Levin, Chief Executive
Officer........................... 1998 356,300(5) 150,779 12,724
1997 357,108(5) 150,139 12,724
1996 183,493 111,322 10,899
Charles B. Engelberg, Chief
Financial Officer................. 1998 149,500 22,779 7,700
1997 135,864 15,139 6,900
1996 128,278 30,322 6,482

Ruth M. Scherbarth, Senior Vice
President......................... 1998 112,608 35,779 5,229
1997 102,620(6) 139 4,374
1996 91,231 30,322 4,164

George F. Alexander, Executive Vice
President......................... 1998 157,502 18,779 8,820
1997 146,301 139 7,862
1996 145,332 25,322 7,560

Karen D. Frolich, Senior Vice
President......................... 1998 123,200 20,779 6,630
1997 113,963 139 5,019
1996 103,032 25,322 4,463
</TABLE>
- --------
(1) In accordance with the rules of the Securities and Exchange Commission, the
compensation set forth in the table does not include medical, group life or
other benefits which are available to all salaried employees of
Renaissance, and certain prerequisites and other benefits, securities or
property which do not exceed the lesser of $50,000 or 10% of the person's
salary and bonus shown in the table.
(2) Includes a benefits allowance in the amount of $3,500 per year, except as
otherwise footnoted.
(3) Includes compensation under profit sharing and discretionary bonus
programs.
(4) Determined in accordance with Renaissance's Management Incentive Program.
(5) Includes as salary $150,000 in each of 1997 and 1998 under a loan
forgiveness Retention Program, as provided in Mr. Levin's employment
agreement with Renaissance.
(6) Benefits allowance at $3,438.

Option Grants in 1998

The following table sets forth the Renaissance stock options granted to the
named executive officers in 1998:

<TABLE>
<CAPTION>
Potential
Realizable
Value at
Assumed Annual
Rates of Stock
Percent of Price
Number of Total Appreciation
Securities Options Exercise for Option
Underlying Granted to or Base Term(2)
Options Employees Price Expiration --------------
Name Granted in 1998(1) ($/Sh)(3) Date 5% ($) 10% ($)
- ---- ---------- ---------- --------- ---------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
Irving J. Levin...... -- -- -- -- -- --
Ruth M. Scherbarth... 8,000(4) 7.6% $3.50 10/01/08 17,600 44,640
Charles B. Engelberg. 18,000(4) 17.0% $3.50 10/01/08 39,600 100,440
George F. Alexander.. 9,000(4) 8.5% $3.50 10/01/08 19,800 50,200
Karen D. Frolich..... 8,000(4) 7.6% $3.50 10/01/08 17,600 44,640
</TABLE>
- --------
(1) Based on a total of 105,900 options granted to Renaissance employees in
1998.

68
<PAGE>

(2) The dollar amounts in these columns represent potential value that might be
realized upon exercise of the options immediately prior to the expiration
of their term, assuming that the market price of the Company's common stock
appreciates in value from the date of grant at the 5% and 10% annual
appreciation rates prescribed by the regulation, and therefore are not
intended to forecast possible future appreciation, if any, of the price of
the Renaissance common stock.
(3) The exercise price of the option was equal to the fair market value of the
common stock on the date of the grant.
(4) These options fully vest on a change-in-control of Renaissance management.

Option Values

The following table sets forth certain information regarding the named
executive officers' Renaissance aggregate options holdings and exercises in
1998:

Aggregated Option Exercises in 1998
and December 31, 1998 Option Values

<TABLE>
<CAPTION>
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
December 31, December 31,
1998 1998($)(2)
---------------- ----------------
Shares Acquired Exercisable/ Exercisable/
Name on Exercise (#) Value Realized ($)(1) Unexercisable Unexercisable
- ---- --------------- ----------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Irving J. Levin......... -- -- 1,789,511/27,426 4,429,627/37,248
Charles B. Engelberg.... -- -- 22,181/40,090 9,228/15,504
Ruth M. Scherbarth...... -- -- 19,429/11,464 36,293/459
George F. Alexander..... -- -- 18,248/25,123 6,419/10,140
Karen D. Frolich........ 4,602 14,557 35,321/22,283 64,598/9,896
</TABLE>
(1) Calculated by subtracting the per share exercise price of the option from
$3.50 per share, the assumed value on the date of exercise, and by
multiplying the difference by the number of shares of common stock
purchased upon the exercise of the option.
(2) Calculated by subtracting the per share exercise price of the option from
$3.50 per share, the assumed value on December 31, 1998, and multiplying
the difference by the number of shares of common stock underlying the
option.

Compensation of Directors

Renaissance outside directors are compensated in the form of stock option
grants. In addition, for 1999 any director serving on a committee of the board
of directors as a Chair is compensated in the form of stock option grants.
Renaissance does not compensate its employee directors for their services as
directors.

The standard director compensation in 1998 was a grant of 4,500 Renaissance
stock options. The standard director compensation in 1999 is a grant of 4,000
Renaissance stock options. Commencing in 1999, Renaissance compensated the
Chair of the Compensation Committee, with 500 Renaissance stock options, and
the Co-Chairs of the Audit Committee are compensated with 500 Renaissance stock
options per year of service.

Employment Agreements

Renaissance presently has employment agreements with Irving J. Levin,
Charles B. Engelberg, Karen D. Frolich and George F. Alexander. See also "The
Merger--Interest of Certain Persons in the Merger."

69
<PAGE>

Irving J. Levin is party to an employment contract with Renaissance pursuant
to which he serves as President, Chairman of the Renaissance Board and Chief
Executive Officer with a minimum base salary of $195,000 per year. This
agreement provides for an annual year-end bonus in the range of fifty to one-
hundred percent of base salary and a "Retention Program" under which loans by
Renaissance to Mr. Levin are forgiven. This agreement also granted Mr. Levin
certain stock options that would be accelerated upon a change-in-control of
Renaissance. The agreement's term is from July 1, 1996 to June 30, 2001.

Charles B. Engelberg is party to an employment contract with Renaissance
pursuant to which he serves as Senior Vice-President and Chief Financial
Officer with a minimum base salary of $150,000 per year. There is a provision
for a bonus pursuant to the Renaissance Management Incentive Plan, a multi-year
stock option grant and a change-in-control severance pay provision. The
agreement's term is from September 1, 1999 to August 31, 2002.

Karen D. Frolich is party to an employment contract with Renaissance
pursuant to which she serves as Chief Financial Officer of Orchard Federal
Savings Bank and as Senior Vice President, with a minimum base salary of
$135,000 per year. There is a provision for a bonus pursuant to the Renaissance
Management Incentive Plan, a multi-year stock option grant and a change-in-
control severance pay provision. The term of this contract is from September 1,
1999 to August 31, 2002.

George F. Alexander is party to an employment contract with Renaissance
pursuant to which he serves as Executive Vice-President with a minimum base
salary of $155,000 per year. There is a provision for a bonus pursuant to the
Renaissance Management Incentive Plan, a multi-year stock option grant and a
change-in-control severance pay provision. The term of this contract is from
September 1, 1999 to August 31, 2002.

Compensation Committee Interlocks and Insider Participation

Renaissance's board of directors has a Compensation Committee that
establishes compensation for Irving J. Levin and approves the compensation for
the other officers of Renaissance. Kenneth M. Novack is the committee Chair,
and Neil Goldschmidt is the committee's other member. Neither Mr. Novack nor
Mr. Goldschmidt is or has served as an officer or employee of Renaissance. Mr.
Levin participates in setting compensation for the other officers of
Renaissance.

Certain Relationships and Related Transactions

Irving J. Levin, president and CEO of Renaissance, is indebted to
Renaissance as a result of the combination of two loans originally secured by a
pledge of his shares and stock options. The largest aggregate amount of
indebtedness outstanding at any time since the beginning of the 1998 fiscal
year was $529,559, including interest at March 31, 1998. As of November 30,
1999 the amount of debt outstanding was $354,399, including interest. The rate
of interest is 6.7%.

Renaissance's Compensation Committee Policies on Executive Compensation

Renaissance's compensation policies applicable to its executive officers
include: offering base salaries that are competitive with the expected size and
performance of Renaissance two years into the future (assuming a minimum per
annum growth rate of 25%); offering average short-term incentive compensation
opportunities and significant long-term incentive compensation opportunities,
typically in the form of stock options; providing conservative benefit
programs; and maintaining meaningful retention elements in the form of
restricted stock, deferred compensation arrangements, and employment contracts.
The intended result is to tie at-risk rewards to performance and to link
executive interests and ownership.

In determining Irving J. Levin's compensation for 1998, the board of
directors independently considered Renaissance's record level of net income of
$4,868,500 and performance and awarded him a bonus within the guidelines
provided for in his employment agreement with Renaissance.

70
<PAGE>

Principal Shareholders of Renaissance

The table below sets forth, as of November 12, 1999 the stock ownership of
the directors, executive officers and principal shareholders of Renaissance
(including all holders of greater than 5% of Renaissance common stock). As of
November 12, 1999, the directors and named executive officers beneficially
owned 4,198,759 shares of Renaissance common stock as a group. The only
director nominee of Renaissance Credit Services who presently holds Renaissance
shares or options exercisable within sixty days of November 12, 1999 is Mr.
Levin. The share ownership and percentage listed in the tables include any
shares of Renaissance common stock subject to options currently exercisable or
exercisable within sixty days from the date of these tables held by the listed
shareholders. The persons and entities listed have, to Renaissance's knowledge,
voting and investment power with respect to all shares of Renaissance stock
shown as being beneficially owned by them, except as may otherwise be described
in the footnotes to the tables. Beneficial ownership is determined in
accordance with the rules and regulations of the Securities and Exchange
Commission.

<TABLE>
<CAPTION>
Percentage of
Number of Common Outstanding Class B Class C
Stock shares Common Stock Common Common
beneficially owned (1) Stock (%) Stock (%)
------------------ ------------- --------- ---------
<S> <C> <C> <C> <C>
Irving J. Levin......... 2,584,208(2) 44.1% -- --
Karen D. Frolich........ 152,852(3) 2.6% -- --
George F. Alexander..... 544,206(4) 9.3% -- --
Ruth M. Scherbarth...... 329,685(5) 5.6% -- --
Charles B. Engelberg.... 86,480(6) 1.5% -- --
Neil Goldschmidt........ 265,449(7) 4.5% -- --
Kenneth M. Novack....... 77,859(8) 1.3% -- --
K. Shelly Porges........ 7,500(9) 0.1% -- --
Frank Martucci.......... 150,520(10) 2.6% -- --
Martin Mitchell......... 908,606 15.5% -- --
Noel Nelson............. 424,647 7.2% -- --
Patricia Reesman........ 965,868 16.5% -- --
William Reesman......... 659,680 11.3% -- --
General Electric Capital
Corporation............ -- -- 317,314 299,078
(100%) (100%)
</TABLE>
- --------
(1) Based on 5,859,419 shares Renaissance common stock as of November 12, 1999.
(2) Includes 1,809,495 options exercisable within 60 days of November 12, 1999.
These numbers assume the cashless exercise of the Non-Compensatory Options
within 60 days of November 12, 1999.
(3) Includes 46,000 shares held by Fritz Frolich; 13,073 held in joint tenancy
with Fritz Frolich; fifty percent of the 5,600 shares held by Ms. Frolich's
children; and 44,937 options exercisable within 60 days of November 12,
1999.
(4) Includes 29,704 options exercisable within 60 days of November 12, 1999;
and 41,572 shares held in trust, over which Mr. Alexander has voting power.
(5) Includes 16,106 options exercisable within 60 days of November 12, 1999.
These numbers assume the cashless exercise of the Non-Compensatory Options
within 60 days of November 12, 1999.
(6) Includes 36,937 options exercisable within 60 days of November 12, 1999.
(7) Includes 4,500 options exercisable within 60 days of November 12, 1999.
(8) Includes 5,000 options exercisable within 60 days of November 12, 1999.
(9) Includes 7,500 options exercisable within 60 days of November 12, 1999.
(10) Includes 120,455 of the 240,909 shares registered in the name of Millcross
High Yield Fund L.P., of which Mr. Martucci is a fifty-percent beneficial
owner; includes 28,565 of the 57,130 options exercisable within 60 days of
November 12,1999 and registered in the name of Millcross High Yield Fund
L.P.; includes 1500 options exercisable within 60 days of November 12,
1999. These numbers assume the cashless exercise of the Non-Compensatory
Options within 60 days of November 12, 1999.

71
<PAGE>

COMPARISON OF RIGHTS OF RENAISSANCE SHAREHOLDERS AND HOUSEHOLD STOCKHOLDERS

Authorized Capital Stock

Household. The authorized capital stock of Household consists of 8,155,004
shares of preferred stock and 750,000,000 shares of Household common stock.
Only Household common stock is issuable under the merger agreement.

Renaissance. The authorized capital stock of Renaissance consists of
25,000,000 shares of Common Stock, 24,500,000 shares of Class B Common stock,
and 500,000 shares of Class C Nonvoting Common Stock.

Size of the Board of Directors

Household. Under Delaware law, the number of directors is fixed by the
bylaws unless the certificate of incorporation fixes the number of directors.
Household's bylaws provide that the number of directors shall be determined by
resolution of the Board of Directors.

Renaissance. Under Oregon law, the number of directors is fixed by the
bylaws unless the articles of incorporation fix the number of directors.
Renaissance's bylaws provide that the number of directors shall be determined
by the Board of the Directors, but shall not be less than three nor more than
nine. The shareholders or the Board of Directors may change the number or
directors by amending the bylaws, contingent upon the approval of the holders
of a majority of the shares of outstanding preferred stock, if any.

Removal of Directors

Household. Under Delaware law, unless otherwise provided in a corporation's
certificate of incorporation, stockholders may remove directors serving on a
classified board of directors only for cause. Household's certificate of
incorporation does not provide for a classified board. All of its directors are
elected on an annual basis.

Renaissance. Under the Oregon Business Corporation Act, shareholders may
remove a director with or without cause unless the articles of incorporation
provide that shareholders may remove directors only for cause. Shareholders may
remove a director only at a meeting of the shareholders called for the purpose
of removing the director and the meeting notice must state that the purpose, or
one of the purposes of the meeting is the removal of the director.
Renaissance's bylaws provide that a director may be removed with or without
cause by the shareholders contingent upon the approval of a majority of the
holders of the outstanding shares of preferred stock, if any. A director who is
elected by a voting group of shareholders may only be removed by that group of
shareholders.

Vacancies on the Board of Directors

Household. Delaware law and Household's bylaws provide that vacancies and
newly created directorships resulting from any increase in the authorized
number of directors may be filled by a majority of the directors then in office
even if they constitute less than a quorum.

Renaissance. Oregon law provides that unless the articles of incorporation
provide otherwise, the shareholders, board or directors, or a majority of the
directors then in office may fill a vacancy on the board of directors.
Renaissance's bylaws provide that vacancies and newly created directorships
resulting from any increase in the authorized number of directors may be filled
by the shareholders, directors or by a majority of the directors then in office
even if they constitute less than a quorum.

72
<PAGE>

Bylaw Amendments

Household. Under Delaware law, Household's stockholders have the power to
adopt, amend or repeal the bylaws. Household's certificate of incorporation
provides that bylaws may also be amended, altered or rescinded by the Board of
Directors.

Renaissance. Under Oregon law and Renaissance's bylaws, Renaissance's bylaws
may be altered, amended, or repealed with new bylaws issued by its Board of
Directors, subject to repeal by its shareholders.

Emergency Bylaws

Household. As permitted by Delaware law, Household's bylaws set up emergency
bylaws which become effective in the case of an emergency condition resulting
in the inability of a quorum of the Board to be readily convened for action.

Renaissance. Although Oregon law allows the board of directors to adopt
emergency bylaws, Renaissance's articles of incorporation and bylaws do not
contemplate emergency bylaws.

Amendment of Articles of Incorporation

Household. Household's certificate of incorporation may be amended by the
affirmative vote of its stockholders. Under Household's certificate of
incorporation, amendments which would adversely affect any class of preferred
stock must be approved by the affirmative vote of the holders of up to two-
thirds of that class of then outstanding preferred stock, if any.

Renaissance. Renaissance's articles of incorporation may be amended by the
corporation's shareholders contingent upon the approval of the holders of a
majority of the outstanding shares of preferred stock, if any.

Calling of Special Meeting of Shareholders

Household. Under Delaware law and Household's bylaws a special meeting of
the stockholders may be called at any time by the President, Chief Executive
Officer or a majority of the Board of Directors. The call shall be in writing,
filed with the Secretary, and shall specify the time and place of holding such
meeting and the purpose or purposes for which it has been called.

Renaissance. Under Oregon law and Renaissance's bylaws special meetings of
Renaissance shareholders can only be called by the president or the Renaissance
Board and must be called by the President at the request of the holders of not
less than 10 percent of the outstanding shares of Renaissance entitled to vote
at the meeting.

Action by Written Consent

Household. Delaware law and Household's bylaws permit stockholders to take
action by written consent in lieu of a meeting if consents are signed by the
holders of outstanding stock having not less than the minimum number of votes
necessary to authorize the action at a meeting at which all the shares entitled
to vote thereon were present and voted.

Renaissance. Oregon law and Renaissance's bylaws provide that any action to
be taken by the shareholders may be taken by written consent signed by all the
shareholders entitled to vote on the action.

Certain Business Combinations

Household. Household's certificate of incorporation prohibits the
corporation from consolidating or merging with another company or selling its
assets as an entirety without the consent of the holders of two-thirds of the
then outstanding preferred stock.

73
<PAGE>

Renaissance. Renaissance's articles of incorporation and bylaws do not
contain specific provisions regarding merger or consolidation of the
corporation. Therefore, any such transaction would be governed by the Oregon
Business Corporation Act.

Conflict of Interests Transactions

Household. Under the Delaware General Corporation Law, a conflict of
interest transaction is not void or voidable solely because the director or
officer's presence at or participation in the meeting of the board which
authorized the transactions or solely because the director or officer's votes
are counted for such purpose if

. the material facts are disclosed or known to the board or committee or to
the stockholders entitled to vote and the transaction has been authorized
by the affirmative vote of a majority of disinterested directors or
committee members or by the stockholders or

. the transaction was fair to Household.

Renaissance. Under the Oregon Business Corporation Act, a conflict of
interest transaction is not voidable by Renaissance solely because of a
director's interest in the transaction if

. the material facts of the transaction and the director's interest were
disclosed to the shareholders and the transaction has been authorized,
approved or ratified by the shareholders or

. the transaction was fair to Renaissance.

Transactions with Interested Stockholders

Household. As a publicly held corporation, Household is subject to Section
203 of the Delaware General Corporation Law, which generally prevents an
"Interested Stockholder" from engaging in certain "Business Combinations" with
a Delaware corporation for three years following the date such person became an
Interested Stockholder, unless certain required approvals of either the board
of directors or stockholders of the corporation, other than the Interested
Stockholders have been obtained.

Renaissance. Section 60.835 of the Oregon Revised Statutes contains a
provision substantially similar to Delaware's Section 203. However, since
Renaissance is not publicly traded it is not subject to this statute.

LEGAL MATTERS

The validity of the shares of Household common stock offered hereby will be
passed upon for Household by John W. Blenke, Vice President--Corporate Law and
Assistant Secretary for Household. Mr. Blenke is a full-time employee and an
officer of Household and owns, and holds options to purchase, shares of
Household common stock. Certain tax matters in connection with the merger will
be passed upon for Household by Wilmer, Cutler & Pickering, Washington, D.C.
Certain legal matters in connection with the merger will be passed upon for
Renaissance by Stoel Rives LLP, Portland, Oregon. Alan R. Blank, Corporate
Secretary of Renaissance, is a partner in the law firm of Stoel Rives LLP.

EXPERTS

The financial statements of Household and its subsidiaries incorporated by
reference in this Prospectus and Proxy Statement, to the extent and for the
periods indicated in its reports, have been audited by Arthur Andersen LLP,
independent public accountants, and are incorporated herein by reference in
reliance upon the authority of said firm as experts in giving said reports.

The consolidated financial statements of Renaissance Holdings, Inc. as of
December 31, 1998 and 1997, and for each of the years in the three-year period
ended December 31, 1998, have been included herein and in the registration
statement in reliance upon the report of KPMG LLP, independent certified public
accountants, appearing elsewhere herein, and upon the authority of said firm as
experts in accounting and auditing.

74
<PAGE>

ADDITIONAL INFORMATION--
WHERE YOU CAN FIND MORE INFORMATION

Household has filed with the Securities and Exchange Commission a
registration statement under the Securities Act of 1933 that registers the
Household common stock to be issued pursuant to the merger. The Registration
Statement, including the attached exhibits and schedules, contains additional
relevant information about Household. The rules and regulations of the
Securities and Exchange Commission allow Household to omit certain information
included in the registration statement from this Prospectus and Proxy
Statement.

In addition, Household files reports, proxy statements and other information
with the Securities and Exchange Commission. Under the Securities Exchange Act
of 1934. You may read and copy that information at the following locations of
the Securities and Exchange Commission:

Public Reference Room New York Regional Chicago Regional
450 Fifth Street, N.W. Office Office
Room 1024 7 World Trade Center 500 West Madison
Washington, D.C. 20549 Suite 1300 Street
1-800-SEC-0330 New York, NY 10048 Chicago, IL 60661

You may also obtain some of this information by mail from the Public
Reference Section of the Securities and Exchange Commission, 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549, at prescribed rates.

The Securities and Exchange Commission also maintains an Internet worldwide
website that contains reports, proxy statements and other information about
issuers, including Household, who file electronically with the Securities and
Exchange Commission. The address of that site to http://www.sec.gov.

You can also inspect reports, proxy statements and other information about
Household at the offices of the New York Stock Exchange, 20 Broad Street,
New York, New York 10005.

The Securities and Exchange Commission also allows Household to "incorporate
by reference" information into this Prospectus and Proxy Statement. This means
that Household can disclose important information to you by referring you to
another document filed separately with the Securities and Exchange Commission.
The information incorporated by reference is considered to be a part of this
Prospectus and Proxy Statement, except for any information that is superseded
by information that is included directly in this document, or any future
filings with the Securities and Exchange Commission made under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 before the merger
date.

This Prospectus and Proxy Statement incorporates by reference the documents
listed below:

. Household's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998;

. Household's Quarterly Reports on Form 10-Q for the quarters ended
March 31, June 30 and September 30, 1999; and

. Household's Current Reports on Form 8-K January 28, 1999, March 16,
1999 and December 3, 1999.

You may request a copy of any filings incorporated by reference in this
Prospectus and Proxy Statement from Household by contacting:

Darcie Oakes
Office of the Secretary
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Telephone: (847) 564-7580
email: [email protected]

You should rely only on the information incorporated by reference or
provided in this Prospectus and Proxy Statement. Household and Renaissance have
not authorized anyone else to provide you with different or additional
information. Household is not making an offer of its common stock in any state
where the offer is not permitted by state laws. You should not assume that the
information in this Prospectus and Proxy Statement is accurate as of any date
other than the date set forth on the front cover.

75
<PAGE>

Consolidated Financial Statements of Renaissance

Index to Financial Statements

Contents

<TABLE>
<S> <C>
Audited Consolidated Financial Statements:
Independent Auditors' Report............................................ F-2
Consolidated Statements of Income for each of the years in the three
year period ended
December 31, 1998...................................................... F-3
Consolidated Balance Sheets at December 31, 1998 and 1997............... F-4
Consolidated Statements of Cash Flows for each of the years in the three
year period ended
December 31, 1998...................................................... F-5
Consolidated Statements of Shareholders' Equity and Comprehensive Income
for each of the years in the three year period ended December 31, 1998. F-6
Notes to Consolidated Financial Statements.............................. F-7
Unaudited Consolidated Financial Statements:
Consolidated Statements of Income for the nine months ended September
30, 1999 and 1998 (unaudited).......................................... F-24
Consolidated Balance Sheet as of September 30, 1999 (unaudited)......... F-25
Consolidated Statements of Cash Flows for the nine months ended
September 30, 1999 and 1998 (unaudited)................................ F-26
Notes to Consolidated Financial Statements (unaudited).................. F-27
</TABLE>

F-1
<PAGE>

Independent Auditors' Report

The Board of Directors
Renaissance Holdings, Inc.:

We have audited the accompanying consolidated balance sheets of Renaissance
Holdings, Inc. and subsidiaries as of December 31, 1998 and 1997, and the
related consolidated statements of income, shareholders' equity and
comprehensive income and cash flows for each of the years in the three year
period ended December 31, 1998. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
consolidated financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Renaissance
Holdings, Inc. and subsidiaries as of December 31, 1998 and 1997, and the
results of their operations and their cash flows for each of the years in the
three year period ended December 31, 1998 in conformity with generally accepted
accounting principles.

KPMG LLP

Portland, Oregon
March 12, 1999

F-2
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF INCOME

Years Ended December 31, 1998, 1997 and 1996

<TABLE>
<CAPTION>
1998 1997 1996
--------- --------- ---------
(In thousands, except per
share data)
<S> <C> <C> <C>
Interest income:
Credit card finance charges, net of account
origination costs............................ $22,530.5 $13,228.1 $ 9,466.4
Annual credit card fees....................... 12,422.4 5,131.8 3,756.4
Other loans................................... 2,445.2 1,844.9 1,506.1
Investments................................... 1,408.3 1,337.3 1,335.4
--------- --------- ---------
Total interest income....................... 38,806.4 21,542.1 16,064.3
--------- --------- ---------
Interest expense:
Deposits...................................... 7,310.4 5,025.3 3,277.4
FHLB advances................................. 234.1 497.8 651.7
Notes payable and other....................... 1,935.5 1,478.4 1,099.8
--------- --------- ---------
Total interest expense...................... 9,480.0 7,001.5 5,028.9
--------- --------- ---------
Net interest income............................. 29,326.4 14,540.6 11,035.4
Provision for loan losses....................... 19,658.5 9,388.6 4,908.0
--------- --------- ---------
Net interest income after provision for loan
losses......................................... 9,667.9 5,152.0 6,127.4
--------- --------- ---------
Non-interest income:
Securitization income......................... 5,251.3 2,541.5 4,257.8
Other credit card fees........................ 25,988.3 10,251.6 6,358.2
Servicing and other fees...................... 4,703.3 2,075.7 157.6
Other income (loss)........................... 480.4 (239.6) 186.8
--------- --------- ---------
Total non-interest income................... 36,423.3 14,629.2 10,960.4
--------- --------- ---------
Non-interest expense:
Compensation, employee benefits and related
expense...................................... 16,070.5 9,497.3 6,127.3
Occupancy, furniture and equipment............ 2,096.2 1,208.8 956.4
Data processing and professional services..... 10,964.4 5,201.6 3,802.6
Advertising, marketing, printing and supplies. 3,122.8 827.6 527.5
Marketing partner profit split................ 3,394.8 1,956.3 2,300.7
Other expense................................. 2,354.1 1,248.7 1,617.7
--------- --------- ---------
Total non-interest expense.................. 38,002.8 19,940.3 15,332.2
--------- --------- ---------
Income (loss) before taxes...................... 8,088.4 (159.1) 1,755.6
Income tax expense (benefit).................. 3,219.9 (526.4) 367.9
--------- --------- ---------
Net income...................................... $ 4,868.5 $ 367.3 $ 1,387.7
========= ========= =========
Earnings Per Common Share:
Earnings available to common shareholders..... $4,868.5 $ 367.3 $ 1,387.7
Average common shares......................... 6,190.2 5,769.9 5,228.9
Average common and common equivalent shares... 8,041.8 6,951.5 6,316.6
Basic earnings per common shares.............. $ .79 $ .06 $ .27
========= ========= =========
Diluted earnings per common share............. $ .61 $ .05 $ .22
========= ========= =========
</TABLE>

See accompanying notes to consolidated financial statements

F-3
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS

December 31, 1998 and 1997

<TABLE>
<CAPTION>
ASSETS
------
1998 1997
(In thousands, except share data) ---------- ----------
<S> <C> <C>
Cash and cash equivalents................................. $ 14,881.9 $ 12,109.4
Investment securities, available for sale................. 129.9 167.1
Investment securities, held to maturity................... 10,671.0 11,128.4
Loans receivable, net:
Credit card receivables, net of allowance for loan
losses of $18,572.6 at December 31, 1998 and $8,154.4
at December 31, 1997................................... 173,167.0 97,931.2
Other loans, net of allowance for loan losses of $218.6
at December 31, 1998 and and $98.5 at December 31,
1997................................................... 28,176.6 19,122.4
Notes receivable.......................................... 445.2 557.7
Accrued interest receivable............................... 425.9 283.6
Stock in Federal Home Loan Bank........................... 823.0 762.9
Excess cash flow on securitized assets.................... 3,523.0 3,169.3
Furniture, fixtures and equipment, net.................... 4,539.3 2,767.6
Deferred income tax asset................................. 1,589.0 1,128.5
Accounts receivable....................................... 1,349.4 1,587.4
Other assets.............................................. 3,061.8 1,951.9
---------- ----------
Total assets.......................................... $242,783.0 $152,667.4
========== ==========
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<S> <C> <C>
Deposits.................................................. $180,634.1 $117,599.8
Borrowings:
Advances from Federal Home Loan Bank.................... 7,200.0 7,800.0
Notes payable........................................... 11,496.3 9,677.9
---------- ----------
Total borrowings...................................... 18,696.3 17,477.9
Accounts payable and accrued expenses..................... 10,115.0 3,303.5
Deferred revenue, net..................................... 18,263.5 4,578.4
Servicing and other liabilities........................... 718.1 549.2
---------- ----------
Total liabilities......................................... 228,427.0 143,508.8
---------- ----------
Shareholders' equity:
Common stock--Class B, $.01 par value, 25,000,000
authorized, 616,392 issued and outstanding at December
31, 1998 and 1997...................................... 6.2 6.2
Common stock, $.01 par value, 25,000,000 authorized,
5,677,847 and 5,564,885 shares issued and outstanding
at December 31, 1998 and 1997, respectively............ 56.8 55.6
Additional paid-in capital.............................. 5,075.2 4,748.4
Retained earnings....................................... 9,221.6 4,352.7
Accumulated other comprehensive loss.................... (3.8) (4.3)
---------- ----------
Total shareholders' equity............................ 14,356.0 9,158.6
---------- ----------
Total liabilities and shareholders' equity............ $242,783.0 $152,667.4
========== ==========
</TABLE>

See accompanying notes to consolidated financial statements

F-4
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years Ended December 31, 1998, 1997 and 1996

<TABLE>
<CAPTION>
1998 1997 1996
----------- ---------- ----------
(In thousands)
<S> <C> <C> <C>
Cash flows from operating activities:
Net income................................ $ 4,868.5 $ 367.3 $ 1,387.7
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization......... 1,376.4 1,052.1 768.4
Gain on sale and disposal of assets... 16.8 210.4 20.3
Provision for loan losses............. 19,658.5 9,388.6 4,908.0
Non-cash portion of securitization.... 5,188.9 6,518.5 2,544.2
Deferred taxes........................ (460.5) (1,097.7) (196.0)
Change in:
Deferred revenue, net............... 13,685.2 2,339.2 706.2
Current tax liability............... 1,394.5 (740.9) 158.3
Accrued interest receivable......... (142.4) (34.1) (71.1)
Investment in unconsolidated
subsidiary......................... -- 240.1 (335.9)
Minority interest in subsidiary..... 30.7 (1,624.9) 1,275.2
Accounts payable and accrued
expenses........................... 5,917.5 1,718.9 (1,257.7)
Other assets and decrease in other
liabilities........................ (2,809.5) (809.8) (96.8)
----------- ---------- ----------
Net cash provided by operating
activities....................... 48,724.6 17,527.7 9,810.8
----------- ---------- ----------
Cash flows from investing activities:
Principal payments on investment
securities, available for sale......... 37.8 5,039.1 --
Purchase of investment securities,
available for sale..................... -- -- (4,995.4)
Principal payments on investment
securities, held to maturity........... 457.3 -- 2,155.6
Repayment of notes receivable........... 112.5 118.1 1,120.2
Loans securitized....................... -- -- 3,832.1
Loan originations and purchased, net of
payments............................... (107,367.8) (59,241.4) (56,766.7)
Decrease in real estate owned........... -- 72.0 14.7
Increase in FHLB stock.................. (60.1) (55.7) (52.6)
Increase in restricted cash............. (192.3) (3.3) (1,167.1)
Purchase of furniture and equipment..... (2,686.9) (2,019.4) (1,124.0)
----------- ---------- ----------
Total cash used in investing
activities....................... (109,699.5) (56,090.6) (56,983.2)
----------- ---------- ----------
Cash flows from financing activities:
Increase in deposits.................... 63,034.3 45,173.7 30,095.0
Repayment of advances from FHLB......... (600.0) (1,200.0) (1,200.0)
Issuance of notes payable............... 3,376.9 5,174.6 7,893.9
Principal payments of notes payable..... (1,614.9) (3,313.4) (77.2)
Capitalization of financing costs....... (776.8) (263.0) (75.0)
Additional stock and warrants issued.... 327.9 2,077.2 471.3
Distributions to shareholders........... -- (218.5) (195.8)
----------- ---------- ----------
Total cash provided by financing
activities....................... 63,747.4 47,430.6 36,912.2
----------- ---------- ----------
Net increase (decrease) in cash........... 2,772.5 8,867.7 (10,260.2)
Cash and cash equivalents at beginning of
year..................................... 12,109.4 3,241.7 13,501.9
----------- ---------- ----------
Cash and cash equivalents at end of year.. $ 14,881.9 $ 12,109.4 $ 3,241.7
=========== ========== ==========
Interest paid............................. $ 9,243.8 $ 5,889.2 $ 4,460.9
=========== ========== ==========
Taxes paid................................ $ 2,753.5 $ 1,343.0 $ 812.2
=========== ========== ==========
</TABLE>

See accompanying notes to consolidated financial statements

F-5
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY AND COMPREHENSIVE INCOME

Years Ended December 31, 1998, 1997 and 1996

<TABLE>
<CAPTION>
Class B Accumulated
Preferred Stock Common Stock Common Stock Additional Other Total
-------------------- ------------------ ------------------ Paid-in Retained Comprehensive Shareholders'
# of shares Amount # of shares Amount # of shares Amount Capital Earnings Income Equity
(In thousands) ----------- -------- ----------- ------ ----------- ------ ---------- -------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at December
31, 1995........... 1,113.5 $1,214.3 151.0 $1.5 $1,046.0 $3,012.1 $16.1 $5,290.0
Add:
Issuance of
common stock...... 30.0 0.3 471.0 471.3
Net income for
1996.............. 1,387.7 1,387.7
Other
comprehensive
income, net of
tax:
Unrealized loss
on investments.. (19.9) (19.9)
Less:
Shareholder
distributions..... (195.7) (195.7)
-------- -------- ----- ---- ------- ----- -------- -------- ------ ---------
Balance at December
31, 1996........... 1,113.5 1,214.3 -- -- 181.0 1.8 1,517.0 4,204.1 (3.8) 6,933.4
-------- -------- ----- ---- ------- ----- -------- -------- ------ ---------
Add:
Exchange of
preferred stock
for common........ (1,113.5) (1,214.3) 1,169.2 11.7 1,202.6
Exchange of
shares with
Renaissance
Bankcard
Services.......... 4,142.2 41.4 (41.4)
Issuance of
common stock...... 616.4 6.2 44.5 0.4 1,679.6 1,686.2
Common stock
options
exercised......... 28.0 0.3 19.1 19.4
Issuance of stock
warrants.......... 371.5 371.5
Net income for
1997.............. 367.1 367.1
Other
comprehensive
income, net of
tax:
Unrealized loss
on investments.. (0.5) (0.5)
Less:
Shareholder
distributions..... (218.5) (218.5)
-------- -------- ----- ---- ------- ----- -------- -------- ------ ---------
Balance at December
31, 1997........... -- -- 616.4 6.2 5,564.9 55.6 4,748.4 4,352.7 (4.3) 9,158.6
-------- -------- ----- ---- ------- ----- -------- -------- ------ ---------
Add:
Common stock
options
exercised......... 112.9 1.2 326.8 328.0
Net income for
1998.............. 4,868.9 4,868.9
Other
comprehensive
income, net of
tax:
Unrealized gain
on investments.. 0.5 0.5
-------- -------- ----- ---- ------- ----- -------- -------- ------ ---------
Balance at December
31, 1998........... -- -- 616.4 $6.2 5,677.8 $56.8 $5,075.2 $9,221.6 $ (3.8) $14,356.0
======== ======== ===== ==== ======= ===== ======== ======== ====== =========
<CAPTION>
Comprehensive
Income
(In thousands) -------------
<S> <C>
Balance at December
31, 1995........... $
Add:
Issuance of
common stock......
Net income for
1996.............. 1,387.7
Other
comprehensive
income, net of
tax:
Unrealized loss
on investments.. (19.9)
Less:
Shareholder
distributions.....
-------------
Balance at December
31, 1996........... 1,367.8
-------------
Add:
Exchange of
preferred stock
for common........
Exchange of
shares with
Renaissance
Bankcard
Services..........
Issuance of
common stock......
Common stock
options
exercised.........
Issuance of stock
warrants..........
Net income for
1997.............. 367.1
Other
comprehensive
income, net of
tax:
Unrealized loss
on investments.. (0.5)
Less:
Shareholder
distributions.....
-------------
Balance at December
31, 1997........... 366.6
-------------
Add:
Common stock
options
exercised.........
Net income for
1998.............. 4,868.9
Other
comprehensive
income, net of
tax:
Unrealized gain
on investments.. 0.5
-------------
Balance at December
31, 1998........... $4,869.4
=============
</TABLE>
See accompanying notes to consolidated financial statements

F-6
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years Ended December 31, 1998, 1997 and 1996

(000's omitted, except share amounts)

1. Summary of Significant Accounting Policies and Description of Business:

Description of Business:

Renaissance Holdings, Inc. (RHI or the Company) is a holding company located
in Beaverton, Oregon with two wholly-owned subsidiaries, Orchard Federal
Savings Bank (Orchard) and Renaissance Bankcard Services (RBS). Orchard, a
community thrift located in Ontario, Oregon, markets and issues credit cards to
cardholders throughout the United States and provides a complete range of
banking services in Ontario. RBS, located in Beaverton, Oregon, principally
operates as a servicing agent for financial institutions that issue credit card
products. RBS has a 99%-owned subsidiary, RBS Holding, L.P., created to manage
the securitization transactions described in Note 6. The Company also has
agreements with certain marketing partners whereby the marketing partners may
provide client prospects, transfer receivables due from these prospects to
credit card accounts and share program profits and credit card losses.

Business Combination and Name Change:

Prior to June 1997, the Company held a majority of Orchard's common stock,
but had no direct investment in RBS. On June 5, 1997, the Company and RBS
executed an exchange of shares in which each RBS share was surrendered for
approximately three shares of RHI. Since RBS and RHI had several common
shareholders and common management, the share exchange was treated as a
combination of entities under common control and, therefore, accounted for
similar to a pooling of interests. Simultaneous with the share exchange, the
Company, previously named TL Holdings, changed its name to Renaissance
Holdings, Inc.

Basis of Financial Statement Preparation:

The books and records of the Company and subsidiaries are maintained on the
accrual basis of accounting for financial statement and tax return purposes.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. The estimates most
susceptible to significant changes are those estimates used in determining the
allowance for loan losses. Although some variability is inherent in these
estimates, management believes that the amounts provided are adequate.

Principles of Consolidation:

The accompanying consolidated financial statements include the accounts of
RHI, its 100% ownership of the common stock of Orchard and its 100%-owned
subsidiary, RBS. Significant intercompany accounts and transactions have been
eliminated in consolidation.

Subsidiary Preferred Stock:

At December 31, 1998, the Company's wholly-owned subsidiary, Orchard, has
issued 120 shares of preferred stock to another party. This preferred stock is
subject to an agreement whereby the purchaser of the stock has a put and RBS
has a call on the 120 shares. For both the put and the call, the exercise date
is April 26, 2000 with an exercise price of $10 per share. This preferred stock
is included within Notes Payable in the Company's consolidated financial
statements.

Cash and Cash Equivalents:

For purposes of the statements of cash flows, the Company considers all
highly-liquid debt instruments purchased with an original maturity of three
months or less to be cash equivalents. Orchard, in accordance with regulations,
must maintain liquid assets of not less than 4% of savings accounts and short-
term borrowings.

F-7
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

Investment Securities:

Investment securities held to maturity are stated at cost, adjusted for
amortization of premiums and discounts. Investment securities available for
sale and trading account securities are stated at market value. Gains and
losses on sales of securities, recognized on a specific identification basis,
and valuation adjustments of trading account securities are included in
noninterest income. Net unrealized gain or loss on securities available for
sale are included, net of tax, as a component of other comprehensive income.

Federal Home Loan Bank Stock:

Orchard is a member of the Federal Home Loan Bank of Seattle (FHLB). At
December 31, 1998 and 1997, Orchard maintained the required investment in
capital stock of the FHLB equal to the greater of 1% of its outstanding
residential loans, 0.3% of total assets or 5% of its outstanding advances from
the FHLB. This investment is carried at cost. At December 31, 1998 and 1997,
$682 and $390, respectively, of FHLB stock was the required minimum investment.

Finance Charge Change

The Company changed the accrual of finance charges for the period from the
end-of-cycle to December 31, 1998 to fully accrue finance charges. The impact
on net income was an increase of $1,096 for the year ended December 31, 1998.

Credit Card Fee Income and Account Origination Costs:

Annual credit card fees are deferred and amortized over the 12-month service
period to which they relate. Account origination costs are also deferred and
amortized over 12 months. At December 31, 1998 and 1997, deferred revenue, net
of origination costs were $18,264 and $4,578, respectively.

Origination and Other Loan Fees:

Loan origination fees, commitment fees and certain related direct costs are
deferred and amortized to interest income over the contractual lives of the
related loans as an adjustment of loan yield using the interest method.

Non-credit-card loan fees representing service costs for the prepayment of
loans, for delinquent payments or for miscellaneous loan services are recorded
as income when collected. Undisbursed loan funds are offset against loans
receivable. Accrued interest represents the current month's interest that will
be included as a part of the borrower's next monthly loan payment. Interest
receivable is accrued only if deemed collectible.

Amortization of Premiums and Discounts:

The Company calculates amortization of non-credit-card premiums and
discounts by use of a constant percentage rate applied to the carrying amount
of long-term interest-bearing assets (interest method). Credit card premiums
are amortized straight line over three years. Discounts on reaffirmed credit
card receivables are amortized to offset charge-offs on reaffirmed receivables
as the charge-offs occur.

Credit Card Loan Losses and the Allowance for Credit Card Loan Losses:

The allowance for credit card loan losses is based on the Company's
evaluation of the collectability of credit card receivables after giving
consideration to current delinquency, historical loss experience, collateral
deposit amounts, partnership sharing arrangements and general credit quality.
The Company's management believes that the allowance for credit card loan
losses is adequate. While management uses available information to recognize
losses on credit cards, adjustments to the allowance may be necessary based on
changes in credit quality and other factors. It is the Company's policy to
continue to accrue interest and fee income on all credit card accounts, except
in limited circumstances, until the account and all related loans,

F-8
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

interest and other fees are charged off. The Company generally charges off
loans during the period in which the loan becomes contractually 180 days past
due.

In 1998, the Company changed the way it estimated its allowances for loan
losses. The change was made to better reflect the timing of the recognition of
credit card losses with events which indicated the potential for loss has
occurred. In addition, this method of estimation is used by many members of its
industry peer group. The accounting treatment previously used to determine the
allowance for credit card losses was in accordance with generally accepted
accounting principles. Had the Company determined the allowance for loan losses
in 1998 based on the previous methodology, the allowance would have been
$22,379 at December 31, 1998. Net income would have been reduced by $2,345
resulting in net income of $2,523 for the year ended December 31, 1998.

Allowance for Loan Losses--Other Loans:

The allowance for loan losses on other loans is based on management's
subjective evaluation of the loan portfolio, past loan experience, and general
market and economic conditions. It is the policy of the Company to provide an
allowance for loan losses when any significant and other than temporary decline
in value can be identified. In addition, various regulatory agencies, as an
integral part of their examination process, periodically review the Company's
allowance for loan losses. Such agencies may require the Company to recognize
additions to the allowance based on their judgments about information available
to them at the time of their examinations. The allowance is maintained at an
amount estimated by management to be sufficient to absorb losses, net of
recoveries (including recovery of collateral), inherent in the existing
portfolio. While management uses available information to recognize losses on
loans and real estate owned, future additions to the allowance may be necessary
based on changes in economic conditions.

Uncollectible interest on loans is charged off, or an allowance is
established by a charge to income equal to all interest previously accrued and
unpaid. Such interest is subsequently recognized only to the extent cash
payments are received until delinquent interest is paid in full. When, in
management's judgment, the borrower's ability to make periodic interest and
principal payments is back to normal, the loan is returned to accrual status.

Furniture, Fixtures and Equipment:

Furniture, fixtures and equipment are stated at cost, less accumulated
depreciation. Depreciation is computed using the straight-line method over the
estimated useful lives of the assets. Most assets are depreciated over lives
ranging from three to seven years. Leasehold improvements are depreciated over
the estimated useful life of the improvement or the remaining lease term,
whichever is shorter.

Real Estate Owned:

Real estate owned consists of real estate acquired through foreclosure
proceedings. It is carried at estimated fair value, less estimated costs to
sell. Costs, excluding interest, relating to the development and improvement of
property are capitalized, whereas those relating to holding the property are
charged to expense. The sale of real estate is recorded at the time the asset
is sold and the related profit generally is recognized as sales proceeds are
collected. Valuations are periodically performed by management and an allowance
for losses is established, if needed, by a charge to earnings if the carrying
value of a property exceeds its estimated fair value, less estimated costs to
sell. Real estate owned of $64 is included in other assets on the consolidated
balance sheets at December 31, 1998 and 1997.

F-9
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

Deposits:

Deposits are a principal source of funds. Deposits vary as to terms, with
the major differences being minimum balances required, maturity, interest rates
and provisions for payment of interest. Interest is accrued and either paid to
the customer or added to the deposit on a periodic basis. On term accounts, the
forfeiture of interest (because of withdrawal prior to maturity) is offset as
of the date of withdrawal against interest expense.

Comprehensive Income:

In June 1997, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 130, "Reporting
Comprehensive Income". This SFAS establishes standards for reporting and
displaying comprehensive income and its components in general-purpose financial
statements. Comprehensive income includes net income and several other items
that current accounting standards require to be recognized outside of net
income. SFAS No. 130 is effective for fiscal years beginning after December 15,
1997 and, as such, was adopted by the Company in 1998. The Company's only item
of comprehensive income is the unrealized gain (loss) on investment securities
available for sale.

Income Taxes:

Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date.

Stock Options:

Statement of Financial Accounting Standards No. 123, (SFAS No. 123)
Accounting for Stock-Based Compensation, permits entities to recognize the fair
value of all stock-based awards as expense over the vesting period. (For this
purpose, fair value is determined on the date of grant.) Alternatively, SFAS
No. 123 also allows entities to continue to apply the provisions of APB Opinion
No. 25, Accounting for Stock Issued to Employees, under which compensation is
recorded on the date of grant only if the current market value of the
underlying stock exceeds the exercise price. For entities that elect to follow
APB Opinion No. 25, SFAS No. 123 requires pro forma net income disclosures for
employee stock option grants as if the fair-value-based method described in
SFAS No. 123 had been applied. The Company has elected to continue to apply the
provisions of APB Opinion No. 25 and furnish the pro forma disclosures as
provided by SFAS No. 123.

Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities:

The Company adopted SFAS No. 125, Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities, effective January 1, 1997.
This Statement provides accounting and reporting standards for transfers and
servicing of financial assets and extinguishments of liabilities based upon
application of a financial-components approach that focuses on control. Under
SFAS No. 125, a transfer of financial assets in which the transferor surrenders
control over those assets is accounted for as a sale to the extent that
consideration other than beneficial interests in the transferred assets is
received in exchange.

The Company securitized a pool of credit card accounts in 1995 and added
additional accounts to the securitized pool pursuant to an amended agreement in
1998. In a securitization supported by revolving receivables, sales are deemed
to occur continuously as receivables are liquidated and replaced by other
receivables from cardholders. The Company retains interests in the transferred
assets, which essentially

F-10
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

represent interest-only (I/O) strips. In addition, the Company assumes the
ongoing obligations to service the transferred assets which are valued at fair
value. The fair value of the servicing liabilities is the excess of the
estimated fee that a third-party servicer, in an arms-length transaction,
would charge to service the credit card receivables, over the contractual
servicing fee per the securitization agreement.

Under SFAS No. 125, the Company allocates the previous carrying amount of
the credit card receivables transferred and securitized between the
receivables sold and the interest retained, based on their relative estimated
fair values at the date of sale. A gain is recognized at the time of the sale
equal to the excess of the fair value of the assets received, principally cash
and an I/O strip, reduced by the fair value of the servicing liability assumed
and the allocated cost of the assets sold. As new receivables are securitized,
gains are recognized and I/O strips and servicing liabilities are recorded.
The I/O strips and servicing liabilities are amortized, using the interest
method, over the remaining projected life of the securitization. As all
estimates used are influenced by factors outside the Company's control, there
is uncertainty inherent in these estimates, making it reasonably possible that
they could change in the near term.

2. Investment Securities:

The amortized cost and estimated market values of the Company's investment
securities are as follows:

<TABLE>
<CAPTION>
December 31, 1998
--------------------------------
Gross
Unrealized Estimated
Amortized ------------ Market
Cost Gains Losses Value
--------- ----- ------ ---------
<S> <C> <C> <C> <C>
Held to maturity:
FNMA................................... $ 7,687 $-- $205 $ 7,482
FHLMC.................................. 2,984 -- 80 2,904
------- ---- ---- -------
10,671 -- 285 10,386
Available for sale:
FNMA................................... 136 -- 6 130
------- ---- ---- -------
$10,807 $-- $291 $10,516
======= ==== ==== =======

<CAPTION>
December 31, 1997
--------------------------------
Gross
Unrealized Estimated
Amortized ------------ Market
Cost Gains Losses Value
--------- ----- ------ ---------
<S> <C> <C> <C> <C>
Held to maturity:
FNMA................................... $ 8,145 $-- $335 $ 7,810
FHLMC.................................. 2,983 -- 94 2,889
------- ---- ---- -------
11,128 -- 429 10,699
Available for sale:
FNMA................................... 175 -- 7 167
------- ---- ---- -------
$11,303 -- $436 $10,866
======= ==== ==== =======
</TABLE>

All investments held as of December 31, 1998 and 1997 are pledged to secure
public deposits and for other purposes required or permitted by law.

Although actual maturities may differ from contractual maturities because
borrowers may have the right to call or prepay obligations, the maturity dates
of the investment securities are after ten years at December 31, 1998 and
1997. As of December 31, 1998, the weighted-average yield for held to maturity
FNMA securities was 5.93%, held to maturity FHLMC securities was 6.13%, and
available for sale FNMA securities was 7.13%.

F-11
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

3. Loans Receivable:

Loans receivable are summarized as follows:

<TABLE>
<CAPTION>
December 31,
------------------
1998 1997
-------- --------
<S> <C> <C>
Credit card receivables............................... $190,531 $106,457
Contract loans secured by real estate................. 20,821 13,292
Mortgage loans........................................ 7,175 5,894
Other consumer loans.................................. 1,394 741
-------- --------
Total face value of loans......................... 219,921 126,384
-------- --------
Less/(plus):
Allowance for loan losses........................... 18,791 8,253
Accrued finance charges............................. 1,778 --
Premium on credit card receivables.................. (49) (88)
Discount on reaffirmed credit card receivables...... 619 460
Unearned discount on contract loans................. 985 706
Net deferred loan fees/contract costs............... 9 --
-------- --------
Net loans......................................... $201,344 $117,053
======== ========
</TABLE>

The activity in the loan loss allowances for the years ended December 31,
1998, 1997, and 1996 are as follows:

<TABLE>
<CAPTION>
1998 1997 1996
-------- -------- -------
<S> <C> <C> <C>
Credit Cards:
Beginning allowance for losses............ $ 8,155 $ 6,143 $ 1,320
Provision for loan losses................. 19,533 9,380 4,929
Loss allowance acquired through purchase
of portfolios............................ 6,233 169 5,699
Actual charge-offs, net of recoveries..... (15,348) (7,538) (5,805)
-------- -------- -------
Ending allowance for credit card losses..... $ 18,573 $ 8,154 $ 6,143
======== ======== =======
Other Loans:
Beginning allowance for losses............ $ 98 $ 69 $ 90
Provision for loan losses................. 126 9 (21)
Loss allowance acquired through purchase.. 5 21 --
Actual charge-offs, net of recoveries..... (11) -- --
-------- -------- -------
Ending allowance for other loans............ $ 218 $ 99 $ 69
======== ======== =======
</TABLE>

At December 31, 1998 and 1997, fixed rate loans amounted to approximately
$24,262 and $15,315, respectively. At December 31, 1998, other loan commitments
to lend amounted to approximately $498.

Mortgage loans of $3,953 and $2,854 in 1998 and 1997, respectively, were
pledged as collateral to the FHLB.

Credit card receivables of $7,059 were purchased in 1998. There were no
credit card receivables purchased in 1997.

F-12
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

The Company maintains an agreement with a health club organization whereby
the balance of selected membership fees due the facility by its members are
transferred to a credit card account issued by the Company. In turn, the
Company pays the health club organization the fee due. The arrangement provides
for the indemnification of losses by the health club organization of the entire
amount of the original balance transferred and a portion of the balances
subsequently charged to the accounts. Total managed receivables outstanding on
accounts originated under this program were $59.1 million and $50.8 million at
December 31, 1998 and 1997, respectively, representing 20.8% and 30.9%,
respectively of total managed receivables outstanding.

At December 31, 1998 and 1997, the Company had no impaired loans or related
interest considered by management to be material to the Company's financial
position. The Company had no commitments to extend additional credit on loans
that are non-accrual or impaired at December 31, 1998.

4. Notes Receivable:

Notes receivable consist of the following:

<TABLE>
<CAPTION>
Balances
At December 31,
Interest ---------------
Type and Maturity Dates Rate 1998 1997
----------------------- -------- ------- -------
<S> <C> <C> <C>
Shareholder note receivable, secured by stock
certificates and fully vested stock options; payable
in annual payments of $92 with a final payment of
$375 in 2000. Rate is variable, based on the Internal
Revenue Service's Applicable Federal Rate for short-
term borrowings...................................... 6.7% $ 414 $ 521
Note receivable from RBS Holding Management Corp.
Shareholders who hold 13% of the stock of the Company
and also hold 100% of the stock of RBS Holding
Management Corporation, which owns a 1% interest in
RBS Holding L.P. Note is variable rate based on the
prime rate plus 1%, interest accrues to the principal
balance and is due on demand......................... 8.8% 31 37
------- -------
Total notes receivable............................ $ 445 $ 558
======= =======
</TABLE>

5. Furniture, Fixtures and Equipment:

Furniture, fixtures and equipment consists of the following at December 31:

<TABLE>
<CAPTION>
1998 1997
------- -------
<S> <C> <C>
Furniture and equipment................................. $ 5,369 $ 3,740
Leasehold improvements.................................. 764 582
Construction in progress................................ 897 61
------- -------
7,030 4,383
Less: Accumulated depreciation.......................... (2,491) (1,615)
------- -------
Furniture, fixtures and equipment, net.................. $ 4,539 $ 2,768
======= =======
</TABLE>

Depreciation expense was $899, $552, and $443 for 1998, 1997, and 1996
respectively.

F-13
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

The future net minimum rental commitments under non-cancelable leases with
an original term of more than one year as of December 31, 1998 are as follows:

<TABLE>
<S> <C>
Year ending December 31,
1999............................................................ $ 924
2000............................................................ 910
2001............................................................ 914
2002............................................................ 919
2003............................................................ 1,036
Thereafter...................................................... 4,234
------
Total minimum lease payments.................................. $8,937
======
</TABLE>

These rental commitments primarily represent leases for facilities. Rent
expense was $810, $446, and $371 in 1998, 1997, and 1996 respectively.

6. Securitization of Credit Card Receivables:

The Company securitized a pool of credit card accounts in 1995, pursuant to
which, the Company issued investor certificates to certain institutional
investors totaling $39.5 million. In July 1998, the Company amended the
agreement, increasing investors' interests to $51 million and adding additional
accounts to the securitized pool.

The difference between the total credit card receivables securitized and the
outstanding investor certificates represents an undivided interest held by the
Company. Although the Company continues to service the underlying credit card
accounts and maintain the customer relationships, the transfer and
securitization of customer receivables, which occurs on an ongoing basis in
order to replenish investor interests in the trust, are treated as sales for
financial reporting purposes to the extent of the investors' interests in the
trusts. Accordingly, the associated credit card receivables are not reflected
on the consolidated balance sheets.

In accordance with SFAS No. 125, Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities, the Company records gains
on the transfer and securitization of credit card receivables to the trust
based on the estimated fair value of assets obtained and liabilities incurred.
The primary assets retained and liabilities incurred consist of an interest-
only (I/O) strip, representing the excess cash flows from the securitization,
and a servicing liability, which amounted to $1,344 and $659 at December 31,
1998 and $1,182 and $505, at December 31, 1997, respectively. To estimate the
fair value of the I/O strip and the servicing liability, the Company used the
following key assumptions:

<TABLE>
<CAPTION>
Rates 1998 1997
----- ---- ----
<S> <C> <C>
Discount........................................................ 20% 10%
Liquidation..................................................... 12% 9%
Finance charge and fee income................................... 25% 25%
Credit loss..................................................... 13% 11%
Interest payment to certificateholders.......................... 6% 6%
Market value of servicing....................................... 4% 4%
</TABLE>

In 1998 and 1997, total transfers and sales of credit card receivables to
the trust represented by investors' interests amounted to $68,192 and $47,115,
resulting in the recognition of gains of approximately $871 and $1,113,
classified in Securitization Income.

F-14
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

In 1995, to facilitate the original securitization, the Company formed a
limited partnership, RBS Holding, L.P. As part of the securitization
agreements, the Company paid approximately $756 and $1,200 for legal and other
transaction costs and a premium associated with the securitization portfolio in
1998 and 1995, respectively. The Company paid these costs because the
securitization provided financing for the receivables generated by several of
its major programs and reduced its cost of funds. The costs of the
securitization were capitalized. The 1998 costs are being amortized over the
period during which the Company will benefit from lower cost of funds
(estimated to be 36 months). The 1995 costs were fully amortized in 1998.

Under the securitization agreement, the Company is required to fund a
reserve account for future losses on the securitized receivables. The reserve
account was $2,168 and $1,975 as of December 31, 1998 and December 31, 1997.
There are a number of covenants in the securitization that, if triggered, would
result in an early amortization of the securitization. The impact would be to
halt distribution to the Company of the investors' share of excess spread until
the reserve account is increased to equal the total investors' share. The key
covenants address excess portfolio spread, payment rates, tangible net worth of
Renaissance Bankcard Services and regulatory capital of Orchard. Management
believes the Company is in compliance with the key covenants as of December 31,
1998.

7. Advances from the Federal Home Loan Bank (FHLB):

At December 31, 1998 and 1997, maturities of FHLB advances were as follows:

<TABLE>
<CAPTION>
1998 interest rate 1998 1997
------------------ ------- ------
<S> <C> <C> <C>
Due within one year..................... 5.15 to 9.00% $ 7,200 $7,600
One year to two years................... -- -- 200
------------ ------- ------
$ 7,200 $7,800
======= ======
</TABLE>

These advances are collateralized by FHLB stock and certain first mortgage
loans.

8. Deposits:

The following is a summary of deposits:

<TABLE>
<CAPTION>
December 31,
-----------------
1998 1997
-------- --------
<S> <C> <C>
Description:
Demand deposits...................................... $ 6,003 $ 4,725
-------- --------
Savings accounts..................................... 15,260 10,477
-------- --------
Certificate of deposit accounts:
Within 1 year...................................... 32,618 51,258
1 year to 2 years.................................. 22,921 16,992
2 years to 3 years................................. 27,828 12,391
3 years to 4 years................................. 18,941 1,390
4 years to 5 years................................. 50,127 18,543
Thereafter......................................... 6,936 1,824
-------- --------
Total certificates............................... 159,371 102,398
-------- --------
Total deposits................................... $180,634 $117,600
======== ========
</TABLE>

F-15
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

Following is a summary of interest expense on deposits:

<TABLE>
<CAPTION>
Years ended December
31,
--------------------
1998 1997 1996
------ ------ ------
<S> <C> <C> <C>
Demand deposits..................................... $ 297 $ 181 $ 150
Savings and time deposits........................... 7,013 4,844 3,127
------ ------ ------
$7,310 $5,025 $3,277
====== ====== ======
</TABLE>

The aggregate amount of time deposits, including certificates of deposits,
with balances of $100 or more at December 31, 1998 and 1997, were $134,780 and
$5,312, respectively.

9. Notes Payable:

Notes payable consist of the following components:

<TABLE>
<CAPTION>
Balances At
December 31,
Interest --------------
Type and Maturity Dates Rate 1998 1997
----------------------- ------------ ------- ------
<S> <C> <C> <C>
Note payable, secured by credit card
receivables with a final maturity in 2000;
payable in monthly minimum amounts of $120
plus additional principal payments based on
reductions in the par value of the portfolios
securing the note. To the extent that the
remaining principal balance has not reached
target levels each year, additional principal
payments may be required. An additional $1,491
was borrowed in 1998.......................... 11.5% $ 4,428 $4,113
Notes payable, fixed and variable rates,
secured by fixed assets, payable in monthly
installments with final maturities in 1999. 8.6% to 8.8% 69 290
Note payable, fixed rate, secured by fixed
assets, payable in monthly installments with
final maturity in 2001........................ 9.5% 917 --
Subordinated capital notes payable, variable
rate tied to prime rate, redeemable any time
after December 31, 1999....................... 9.8% 925 925
Senior subordinated note payable, with final
maturity in 2003; fixed rate of 7%, $3,500
face value, discounted to market at 9.5%,
interest payable quarterly, two equal
principal payments in 2002 and 2003........... 9.5% 3,215 3,158
Subordinated note payable, fixed rate, with
final maturity in 2003. Interest payable
annually, two equal principal payments in 2001
and 2003...................................... 10.0% 750 --
Notes payable, related to put/call option on
120,000 shares of Orchard preferred stock,
exercise date of April 26, 2000............... 10.0% 1,192 1,192
------- ------
Total notes payable............................ $11,496 $9,678
======= ======
</TABLE>

Notes payable maturities in 1999, 2000, 2001, 2002 and 2003 are $3,248,
$2,918, $549, $1,750 and $2,125, respectively.

F-16
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

10. Income Taxes:

Prior to the business combination on June 5, 1997, as discussed in Note 1,
TL Holdings, Inc. and Orchard filed consolidated income tax returns. RBS, as an
S corporation, filed separate income tax returns through December 31, 1996.
Effective January 1, 1997, RBS voluntarily revoked its S corporation election.
Beginning in 1997 however, RHI filed a consolidated return with Orchard and
RBS.

The following is a summary of income tax expense (benefit):

<TABLE>
<CAPTION>
Years ended December
31,
----------------------
1998 1997 1996
------ ------- -----
<S> <C> <C> <C>
Current tax expense:
Federal........................................ $3,050 $ 513 $ 470
State.......................................... 630 59 94
------ ------- -----
3,680 572 564
------ ------- -----
Deferred tax expense (benefit):
Federal........................................ (381) (909) (176)
State.......................................... (79) (189) (20)
------ ------- -----
$(460) $(1,098) $(196)
------ ------- -----
$3,220 $ (526) $ 368
====== ======= =====
</TABLE>

An analysis of income tax expense (benefit), setting forth the reasons for
the variation from the "expected" Federal corporate income tax rate of 34% and
the effective rate provided, is as follows:

<TABLE>
<CAPTION>
Years ended
December 31,
------------------
1998 1997 1996
------ ----- ----
<S> <C> <C> <C>
Federal "expected" corporate income tax.............. $2,803 $ 5 $622
State income taxes, net of Federal income tax
benefit............................................. 363 (27) 81
Permanent differences................................ 19 10 2
S Corporation earnings............................... -- -- (349)
Increase to deferred tax asset for S Corporation
revocation.......................................... -- (501) --
Other................................................ 35 (13) 12
------ ----- ----
$3,220 $(526) $368
====== ===== ====
</TABLE>

F-17
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

The tax effects of temporary differences, which give rise to a significant
portion of deferred tax assets and deferred tax liabilities at December 31,
1998 and 1997, are as follows:

<TABLE>
<CAPTION>
Years ended
December 31,
-------------
1998 1997
------ ------
<S> <C> <C>
Deferred tax assets:
Credit card receivables, primarily due to allowance for
losses.................................................. $4,291 $2,126
Loans receivable, primarily due to allowance for losses.. 296 37
Other deferred tax assets................................ 39 23
------ ------
Total gross deferred tax assets........................ 4,626 2,186
Deferred tax liabilities:
Accrued interest income.................................. 509 --
Deferred account origination costs....................... 1,932 438
Securitization assets and liabilities.................... 259 257
FHLB stock dividends..................................... 151 128
Other deferred tax liabilities........................... 186 234
------ ------
Total gross deferred tax liabilities................... 3,037 1,057
------ ------
Net deferred tax assets................................ $1,589 $1,129
====== ======
</TABLE>

There was no valuation allowance at December 31, 1998 and 1997 because
management believes that it is more likely than not that the Company will
realize its gross deferred tax assets from expected future taxable income,
reversing temporary differences and available carryback to prior years.

Had RBS been a C corporation prior to January 1, 1997, the pro forma 1997
income (loss) would have been as follows:

<TABLE>
<CAPTION>
Year Ended 1997
-------------------------------------
Unaudited Pro Forma
Net Income (Loss) Net Income (Loss)
----------------- -------------------
<S> <C> <C>
Renaissance Bankcard Services............. $(218) $(719)
Renaissance Holdings, Inc. and Orchard.... 585 585
----- -----
Combined.................................. $ 367 $(134)
===== =====
</TABLE>

Unaudited pro forma net income (loss) reflects adjustments to net income to
record an estimated provision for income taxes assuming RBS was a C corporation
in years prior to 1997.

11. Shareholders' Equity:

During 1997, the Company authorized a new class of Common shares, Class B,
and issued Class B shares, Class B warrants and debt subject to a Securities
Purchase Agreement. The authorized capital stock of the Company consists of
50,000 shares of voting stock, including 25,000 shares of Common stock, $0.01
par value and 25,000 shares of Class B Common stock, $0.01 par value. At
December 31, 1998 5,678 and 616 shares of Common and Class B Common stock,
respectively, were outstanding. The Company has reserved 4,349 shares of Common
stock for: (a) outstanding Common stock options, (b) authorized, but unissued,
Common stock options, and (c) issuance upon conversion of the Class B stock and
Class B warrants. Separate from the common shares discussed above, the Company
has reserved 1,123 Class B Common shares for exercise of the Class B warrants
outstanding.

F-18
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

The Class B Common stock has preferential rights including, but not limited
to, the following:

. Liquidation preference over Common stock

. Preemptive rights to acquire additional shares on a proportionate basis
if new shares are issued

. Registration demand rights

. Conversion to Common stock

The Securities Purchase Agreement restricts the Company from retiring stock
or making any distributions on behalf of shareholders.

In June 1997, the Company issued 1,396 Class B stock warrants at an exercise
price of $2.507 per share. The value of warrants issued was determined by
calculating the excess of total consideration received pursuant to the
Securities Purchase Agreement over the fair value of stock and debt issued.
These warrants are not exercisable until June 2002 and expire June 2006. The
warrants carry a redemption option exercisable after June 2002. If exercised,
the Company must buy back the warrants at the current fair market value of the
stock less the warrant strike price. Under certain conditions, the warrant
holder may accelerate their right to buy Class B stock. The warrant contract
also stipulates that if the Company meets certain earnings targets for 1998 and
1999, 273 and 256 warrants, respectively, will be surrendered for cancellation.
Accordingly, 273 warrants will be cancelled as a result of meeting the 1998
earnings targets.

The Company has adopted stock option plans that provide for the granting of
Incentive Stock Options and Nonqualified Stock Options to purchase 2,674 shares
of the Company's Common Stock to officers, key employees and directors at
prices greater than or equal to the fair market value on the date the option is
granted. Options become exercisable as determined at the date of grant by the
Board of Directors. The terms of the options range from five to ten years as
established at the time of grant. Vesting periods range from two to five years.

Common stock option activity for the years ended December 31, 1998 and 1997
is as follows:

<TABLE>
<CAPTION>
Weighted
Common Average
Shares Exercise
Outstanding Price
----------- --------
<S> <C> <C>
Options outstanding at December 31, 1995............. 1,260 $0.42
Granted............................................ 1,032 2.49
Exercised.......................................... (15) 1.02
Options outstanding at December 31, 1996............. 2,277 1.35
Granted............................................ 153 2.51
Exercised.......................................... (28) 0.68
Forfeited.......................................... (9) 1.68
Options outstanding at December 31, 1997............. 2,393 1.43
-----
Granted............................................ 187 3.35
Exercised.......................................... (113) 2.90
Forfeited.......................................... (17) 2.94
-----
Options outstanding at December 31, 1998............. 2,450 1.42
=====
Options exercisable at December 31, 1998............. 2,034 1.26
=====
</TABLE>

F-19
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

The options on Common Stock outstanding at December 31, 1998 comprised the
following:

<TABLE>
<CAPTION>
Average
Weighted Average Remaining Life
Options Exercise Price Range Exercise Price (years)
------- -------------------- ---------------- --------------
<S> <C> <C> <C>
1,165 $0.34 to $0.67 $0.37 2.7
816 $1.35 to $2.02 $1.97 6.9
345 $2.51 to $4.38 $3.35 6.5
124 $2.51 to $3.50 $3.46 9.7
-----
2,450
=====
</TABLE>

The Company uses the intrinsic-value-based method to account for options.
Accordingly, no compensation costs have been recognized for stock options
issued. Had compensation cost for the Company's options been determined based
on the fair value at the grant dates consistent with the fair- value-based
method of SFAS No. 123, Accounting for Stock-Based Compensation, the Company's
net income would have been reduced to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
1998 1997 1996
------ ---- ------
<S> <C> <C> <C> <C>
Net Income
As reported...................................... $4,869 $367 $1,388
Pro forma........................................ $4,643 $306 $1,329
</TABLE>

The cumulative impact of years prior to 1996 would have been a $127
reduction in reported net income. The Common stock options granted during 1998
and 1997 had weighted average fair market values of $0.78 and $0.65 per share,
respectively. The fair value of options were calculated based on the following
average assumptions for 1998 and 1997: risk free interest rate of 5.3% and
5.6%, respectively, expected exercise period of 5 years, zero expected
dividends. No volatility was factored into the valuation.

12. Regulatory Matters:

Orchard is subject to various regulatory capital requirements administered
by the federal banking agencies. Failure to meet minimum requirements can
initiate certain mandatory, and possibly additional discretionary, actions by
regulators that, if undertaken, could have a direct material effect on the
Company's financial statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, Orchard must meet specific
capital guidelines that involve quantitative measures of its assets,
liabilities and certain off-balance-sheet items as calculated under regulatory
accounting practices. Orchard's capital amounts and classifications are also
subject to qualitative judgments by the regulators about components, risk
weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy
require Orchard to maintain minimum amounts and ratios (set forth in the
following table) of total and Tier 1 capital (as defined in the regulations) to
risk-weighted assets (as defined) and Tier 1 capital to average assets (as
defined). Management believes, as of December 31, 1998, that Orchard meets all
capital adequacy requirements to which it is subject.

As of December 31, 1998, Orchard was considered "well capitalized" under the
regulatory framework. To be categorized as well capitalized, Orchard must
maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios
as set forth in the following table. Management does not believe that there are
any events or changes in condition since December 31, 1998 that have affected
Orchard's regulatory classification.

F-20
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

Orchard's actual capital amounts and ratios are presented in the following
table:

<TABLE>
<CAPTION>
To be well
capitalized
under prompt
For capital corrective
adequacy action
Actual purposes provisions
------------- ------------- -------------
Amount Ratio Amount Ratio Amount Ratio
------- ----- ------- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C>
As of December 31, 1998:
Total capital (to risk weighted
assets)....................... $19,792 10.4% $15,194 >8.0% $18,993 >10.0%
Tier 1 capital (to risk
weighted assets).............. 18,084 9.5 7,597 >4.0 10,850 >6.0
Tier 1 capital (to average
assets)....................... 18,084 8.0 9,102 >4.0 11,378 >5.0
As of December 31, 1997:
Total capital (to risk weighted
assets)....................... $11,079 10.4% $ 8,503 >8.0% $10,629 >10.0%
Tier 1 capital (to risk
weighted assets).............. 9,556 9.0 4,251 >4.0 6,377 >6.0
Tier 1 capital (to average
assets)....................... 9,556 8.5 4,523 >4.0 5,654 >5.0
</TABLE>

13. Fair Value of Financial Instruments:

Financial instruments have been construed to generally mean cash or a
contract that implies an obligation to deliver cash or another financial
instrument to another entity. The estimated fair values of the Company's
financial instruments are as follows:

<TABLE>
<CAPTION>
December 31, December 31,
1998 1997
---------------- ----------------
Carrying Fair Carrying Fair
amount value amount value
-------- ------- -------- -------
<S> <C> <C> <C> <C>
Financial assets:
Cash and equivalents..................... $ 14,882 14,882 $ 12,109 12,109
Investment securities.................... 10,801 10,516 11,295 10,866
Loans, net............................... 201,344 193,952 117,053 116,329
Notes receivable......................... 445 445 558 558
Stock in FHLB............................ 823 823 763 763
Excess cash flow on securitized assets... 1,344 1,344 1,182 1,182
Accounts receivable...................... 1,349 1,349 1,587 1,587
Financial liabilities:
Deposits................................. 180,634 183,614 117,600 118,627
Advances from FHLB....................... 7,200 7,204 7,800 7,819
Notes payable............................ 11,496 11,496 9,678 9,678
Securitization servicing liability....... 659 659 505 505
</TABLE>

Financial assets and financial liabilities other than investment securities
are not traded in active markets. The above estimates of fair value require
subjective judgment and are approximate. Changes in the following methodologies
and assumptions could significantly affect the estimates. These estimates may
also vary significantly from the amounts that could be realized in actual
transactions.

. Financial Assets--The estimated fair value approximates the book value
of cash equivalents, credit card receivables, notes receivable, Federal
Home Loan Bank (FHLB) stock, excess cash flow on

F-21
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

securitized assets (see note 6) and accounts receivable. For securities,
the fair value is based on quoted market prices, where available. The
fair value of loans is estimated by discounting future cash flows using
current rates at which similar loans would be made. The notes
receivables are on variable interest rates, and therefore fair value
approximates book value.

. Financial Liabilities--The estimated fair value of deposits is estimated
by discounting the future cash flows using current rates at which
similar deposits would be made. The estimated fair value of advances
from FHLB is estimated by discounting the future cash flows using
current rates at which similar borrowings would be made. The estimated
fair value of debt approximates the carrying value as rates on these
instruments are comparable to instruments of similar risk.

The Company did not hold any derivative financial instruments in its
investment portfolio at or during the years ended December 31, 1998, 1997 and
1996.

14. Employee Benefit Plans:

The Company has established a 401(k) retirement plan covering all employees
who are at least 21 years of age and who have been with the Company at least
six months. During 1997, the Company decreased the minimum age for
participation in the plan to 18 years of age. The Company matches 100% of
employee deferrals up to 3% of compensation and 50% of employee deferrals
between 3% and 6% of compensation. Expense under the plan was $241, $162 , and
$122 for the years ended December 31, 1998, 1997, and 1996 respectively.

15. Off-Balance Sheet Risk:

The approximate composition of the portfolios held by client banks for
which the Company assumes the risk of loss at December 31 is as follows (in
millions):

<TABLE>
<CAPTION>
1998 1997
---- ----
<S> <C> <C>
Total portfolio serviced by the Company...................... $285 $165
Less portfolio funded by the Company....................... (191) (106)
---- ----
Subtotal..................................................... 94 59
Securitized accounts serviced by the Company for which a cash
reserve has been established as discussed in Note 6......... (51) (40)
Additional accounts funded by marketing partners for which
the Company did not assume risk of loss..................... (7) (7)
---- ----
Outstanding balances carried by a client for which the
Company assumes risk........................................ 36 12
Unused credit (open-to-buy)**................................ 136 69
Collateral deposits ***...................................... (22) (22)
---- ----
Net off-balance sheet amount at risk for loss................ $150 $ 59
==== ====
</TABLE>
- --------
** Unused credit is the excess of total credit limits granted to customers over
the outstanding portfolio balances.
*** The Company has credit card programs secured by individual savings
deposits.

F-22
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Concluded)

Years Ended December 31, 1998, 1997 and 1996
(000's omitted, except per share amounts)

16. Earnings Per Common Share:

<TABLE>
<CAPTION>
Year ended December 31,
-----------------------------------------------------
1998 1997 1996
----------------- ----------------- -----------------
Diluted Basic Diluted Basic Diluted Basic
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Earnings available to
common shareholders..... $4,868.5 $4,868.5 $ 367.3 $ 367.3 $1,387.7 $1,387.7
======== ======== ======== ======== ======== ========
Average Shares
Common................. 6,190.2 6,190.2 5,769.9 5,769.9 5,228.9 5,228.9
Common equivalents..... 1,851.6 -- 1,181.6 -- 1,087.7 --
-------- -------- -------- -------- -------- --------
Total................ 8,041.8 6,190.2 6,951.5 5,769.9 6,316.6 5,228.9
======== ======== ======== ======== ======== ========
Earnings per common
share................... $ .61 $ .79 $ .05 $ .06 $ .22 $ .27
======== ======== ======== ======== ======== ========
</TABLE>

F-23
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF INCOME
For the Nine Months Ended September 30, 1999 and 1998

<TABLE>
<CAPTION>
1999 1998
--------- ---------
In thousands,
except per share
data
(Unaudited)
<S> <C> <C>
Interest income:
Credit card finance charges, net of account origination
costs................................................... $32,102.8 $15,889.4
Annual credit card fees.................................. 27,559.8 7,245.1
Other loans.............................................. 2,496.2 1,748.4
Investments.............................................. 1,371.7 1,010.6
--------- ---------
Total interest income.................................. 63,530.5 25,893.5
--------- ---------
Interest expense:
Deposits................................................. 10,087.7 5,136.9
FHLB advances............................................ 21.0 199.8
Notes payable and other.................................. 1,037.1 1,410.3
--------- ---------
Total interest expense................................. 11,145.8 6,747.0
--------- ---------
Net interest income........................................ 52,384.7 19,146.5
Provision for loan losses.................................. 43,350.0 11,340.9
--------- ---------
Net interest income after provision for loan losses.... 9,034.7 7,805.6
--------- ---------
Non-interest income:
Securitization income.................................... 3,744.0 4,884.9
Other credit card fees................................... 52,429.1 14,013.3
Servicing and other fees................................. 4,994.4 3,573.3
Other income............................................. 1,854.3 377.9
--------- ---------
Total non-interest income.............................. 63,021.8 22,849.4
--------- ---------
Non-interest expense:
Compensation, employee benefits and related expense...... 20,754.6 10,414.8
Occupancy, furniture and equipment....................... 2,499.4 1,320.1
Data processing and professional services................ 18,000.8 6,340.0
Advertising, marketing, printing and supplies............ 5,613.4 2,640.8
Marketing partner profit split........................... 3,239.7 2,376.0
Other expense............................................ 3,525.6 1,553.7
--------- ---------
Total non-interest expense............................. 53,633.5 24,645.4
--------- ---------
Income before taxes........................................ 18,423.0 6,009.6
Income tax expense....................................... 7,507.6 2,383.9
--------- ---------
Net income................................................. $10,915.4 $ 3,625.7
--------- ---------
Earnings Per Common Share
Earnings available to common shareholders................ $10,915.4 $ 3,625.7
Average common shares.................................... 6,393.4 6,181.3
Average common and common equivalent shares.............. 9,715.7 8,029.4
Basic earnings per common share.......................... $ 1.71 $ .59
========= =========
Diluted earnings per common share........................ $ 1.12 $ .45
========= =========
</TABLE>

See accompanying notes to consolidated financial statements

F-24
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED BALANCE SHEET

September 30, 1999

<TABLE>
<CAPTION>
ASSETS 1999
------ -----------
In
thousands,
except
share data.
(Unaudited)
<S> <C>
Cash and cash equivalents.......................................... $ 39,622.9
Investment securities, available for sale.......................... 101.8
Investment securities, held to maturity............................ 7,500.3
Loans receivable, net:
Credit card receivables, net of allowance for loan losses of
$42,902.1....................................................... 274,387.4
Other loans, net of allowance for loan losses of $301.2.......... 35,569.2
Notes receivable................................................... 445.2
Accrued interest receivable........................................ 388.3
Stock in Federal Home Loan Bank.................................... 869.4
Excess cash flow on securitized assets............................. 3,516.1
Furniture, fixtures and equipment, net............................. 12,379.3
Deferred income tax asset.......................................... 10,660.8
Accounts receivable................................................ 4,995.7
Other assets....................................................... 4,558.4
----------
Total Assets................................................... $394,994.8
==========
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<S> <C>
Deposits........................................................... $325,138.2
Notes payable...................................................... 10,403.7
Accounts payable and accrued expenses.............................. 13,654.2
Deferred revenue, net.............................................. 19,209.8
Servicing and other liabilities.................................... 769.2
----------
Total liabilities.............................................. 369,175.1
----------
Shareholders' Equity:
Common stock--Class B, $.01 par value, 24,500,000 authorized,
317,314 issued and outstanding at September 30, 1999............ 3.2
Common stock--Class C, $.01 par value, 500,000 authorized,
299,078 issued and outstanding at September 30, 1999............ 3.0
Common stock, $.01 par value, 25,000,000 authorized, 5,857,086
shares issued and outstanding at September 30, 1999............. 58.6
Additional paid-in capital....................................... 5,622.9
Retained earnings................................................ 20,137.0
Accumulated other comprehensive loss............................. (5.0)
----------
Total shareholders' equity..................................... 25,819.7
----------
Total liabilities and shareholders' equity..................... $394,994.8
==========
</TABLE>

See accompanying notes to consolidated financial statements

F-25
<PAGE>

RENAISSANCE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine Months Ended September 30, 1999 and 1998

<TABLE>
<CAPTION>
1999 1998
---------- ---------
In thousands
(Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income............................................ $ 10,915.4 $ 3,625.7
Adjustments to reconcile net income to cash provided
by operating activities:
Depreciation and amortization....................... 1,474.8 1,016.1
Gain on sale and disposal of assets................. 38.1 11.7
Provision for loan losses........................... 43,350.0 11,340.9
Non-cash portion of securitization.................. 4,603.9 2,759.5
Deferred taxes...................................... (9,071.7) 14.8
Change in:
Deferred revenue, net............................. 946.2 5,324.6
Current tax liability............................. (1,217.7) 1,382.7
Accrued interest receivable....................... 37.6 (69.2)
Investment in unconsolidated subsidiary........... -- 0.5
Minority interest in subsidiary................... 21.6 16.8
Accounts payable and accrued expenses............. 4,514.8 3,427.4
Other assets and decrease in other liabilities.... (2,317.5) 1,105.5
---------- ---------
Net cash provided by operating activities....... 53,295.5 29,957.0
---------- ---------
Cash flows from investing activities:
Principal payments on investment securities, available
for sale............................................. 27.0 (137.3)
Principal payments on investment securities, held to
maturity............................................. 3,170.8 244.6
Repayment of notes receivable......................... -- 20.5
Loan originations and purchased, net of payments...... (158,571.7) (43,697.5)
Decrease in real estate owned......................... (754.9) --
Increase in FHLB stock................................ (46.4) (44.4)
Increase in restricted cash........................... (0.3) (195.6)
Purchase of furniture and equipment................... (9,061.4) (1,143.6)
---------- ---------
Total cash used in investing activities......... (165,236.9) (44,953.3)
---------- ---------
Cash flows from financing activities:
Increase in deposits.................................. 144,504.1 21,666.2
Repayment of advances from FHLB....................... (7,200.0) (200.0)
Issuance of notes payable............................. 718.9 3,376.9
Principal payments of notes payable................... (1,858.1) (1,199.2)
Capitalization of financing costs..................... (32.0) (752.8)
Additional stock and warrants issued.................. 549.5 --
---------- ---------
Total cash provided by financing activities..... 136,682.4 22,891.1
---------- ---------
Net increase in cash and cash equivalents............... 24,741.0 7,894.8
Cash and cash equivalents at beginning of year.......... 14,881.9 12,109.4
---------- ---------
Cash and cash equivalents at end of year................ $ 39,622.9 $20,004.2
========== =========
Interest paid........................................... $ 11,308.6 $ 6,234.3
========== =========
Taxes paid.............................................. $ 17,796.2 $ 986.0
========== =========
</TABLE>

See accompanying notes to consolidated financial statements

F-26
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
(000's omitted, except share amounts)

1. Basis of Presentation:

The accompanying unaudited condensed consolidated financial statements of
Renaissance Holdings, Inc. ("Renaissance" or "the Company") and its
subsidiaries have been prepared in accordance with generally accepted
accounting principles for interim financial information. Additionally, these
financial statements have been prepared in accordance with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for
a fair presentation have been included. Operating results for the nine months
ended September 30, 1999 should not be considered indicative of the results for
any future quarters or the year ending December 31, 1999. These financial
statements should be read in conjunction with the consolidated financial
statements and footnotes included in the Prospectus.

2. Investment Securities:

The amortized cost and estimated market values of the Company's investment
securities at September 30, 1999 are as follows:

<TABLE>
<CAPTION>
Gross
Unrealized Estimated
Amortized ------------ Market
Cost Gains Losses Value
--------- ----- ------ ---------
<S> <C> <C> <C> <C>
Held to maturity:
FNMA................................... $2,985.1 $ -- $101.2 $2,883.9
FHLMC.................................. 4,515.2 -- 180.9 4,334.3
-------- ----- ------ --------
7,500.3 -- 282.1 7,218.2
Available for sale:
FNMA................................... 110.0 -- 8.2 101.8
-------- ----- ------ --------
$7,610.3 $ -- $290.3 $7,320.0
======== ===== ====== ========
</TABLE>

All investments held as of September 30, 1999 are pledged to secure public
deposits and for other purposes required or permitted by law.

F-27
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
(Unaudited)
(000's omitted, except share amounts)

3. Loans Receivable:

Loans Receivable at September 30, 1999 are summarized as follows:

<TABLE>
<CAPTION>
September 30,
1999
---------------
<S> <C> <C>
Credit card receivables................................. $317,187.7
Contract loans secured by real estate................. 26,614.9
Mortgage loans........................................ 8,989.2
Other consumer loans.................................. 1,491.1
----------
Total face value of loans........................... 354,282.9
----------
Less:
Allowance for loan losses............................. 43,203.3
Premium on credit card receivables.................... (435.2)
Discount on reaffirmed credit card receivables........ 333.4
Unearned discount on contract loans................... 1,201.0
Net deferred loan fees/contract costs................. 23.8
----------
Net loans........................................... $309,956.6
==========
</TABLE>

In addition, in accordance with SFAS 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities", the Company
has recorded interest only strips and servicing liabilities at September 30,
1999. To estimate the fair value of the interest only strip and servicing
liability, the Company used the following assumptions:

<TABLE>
<CAPTION>
Rates
-----
<S> <C>
Discount............................................................ 20%
Liquidation......................................................... 12%
Finance charge and fee income....................................... 24%
Credit loss......................................................... 12%
Interest payments to certificate holders............................ 6%
Market value of servicing........................................... 4%
</TABLE>

The activity in the loan loss allowances for the nine months ended
September 30, 1999 are as follows:

<TABLE>
<S> <C>
Credit Cards:
Beginning allowance for losses.............................. $ 18,572.6
Provision for loan losses................................... 43,261.9
Loss allowance acquired through purchase of portfolios...... 16,158.5
Actual charge-offs, net of recoveries....................... (35,090.9)
----------
Ending allowance for credit card losses....................... $ 42,902.1
==========
Other Loans:
Beginning allowance for losses.............................. $ 218.6
Provision for loan losses................................... 88.1
Actual charge-offs, net of recoveries....................... (5.5)
----------
Ending allowance for other loans.............................. $ 301.2
==========
</TABLE>

F-28
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
(Unaudited)
(000's omitted, except share amounts)

4. Income Taxes:

Our effective tax rate was 40.8 percent for the nine months ended September
30, 1999 and 39.7 percent for the first nine months of 1998. The effective tax
rate differs from the statutory federal income tax rate in these years
primarily because of the effects of state income taxes, net of federal income
tax benefit.

5. Earnings per Common Share:

Earnings per common share for the nine months ended September 30 were
calculated as follows:

<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------------
1999 1998
------------------- -----------------
Diluted Basic Diluted Basic
--------- --------- -------- --------
<S> <C> <C> <C> <C>
Earnings available to common
shareholders...................... $10,915.4 $10,915.4 $3,625.7 $3,625.7
========= ========= ======== ========
Average shares outstanding:
Common........................... 6,393.4 6,393.4 6,181.3 6,181.3
Common equivalents............... 3,322.3 -- 1,848.1 --
--------- --------- -------- --------
Average shares outstanding assuming
dilution.......................... 9,715.7 6,393.4 8,029.4 6,181.3
========= ========= ======== ========
Earnings per common share.......... $ 1.12 $ 1.71 $ .45 $ .59
========= ========= ======== ========
</TABLE>

6. Other Comprehensive Income:

Other comprehensive income, consisting solely of unrealized gains/losses on
available for sale investments, was immaterial for both the nine months ended
September 30, 1999 and 1998.

7. Regulatory Matters:

Orchard Federal Savings Bank ("Orchard"), a wholly-owned subsidiary of
Renaissance, is subject to various regulatory capital requirements administered
by the federal banking agencies. Failure to meet minimum requirements can
initiate certain mandatory, and possibly additional discretionary, actions by
regulators that, if undertaken, could have an effect on the Company's financial
statements. Under capital adequacy guidelines and the regulatory framework for
prompt corrective action, Orchard must meet specific capital guidelines that
involve quantitative measures of its assets, liabilities and certain off-
balance-sheet items as calculated under regulatory accounting practices.
Orchard's capital amounts and classifications are also subject to qualitative
judgments by the regulators about components, risk weightings and other
factors.

Quantitative measures established by regulation to ensure capital adequacy
require Orchard to maintain minimum amounts and ratios (set forth in the
following table) of total and Tier 1 capital (as defined in the regulations) to
risk-weighted assets (as defined) and Tier 1 capital to average assets (as
defined). Management believes, as of September 30, 1999, that Orchard meets all
capital adequacy requirements to which it is subject.

As of September 30, 1999, Orchard was considered "well capitalized" under
the regulatory framework. To be categorized as well capitalized, Orchard must
maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios
as set forth in the following table. Management does not believe that there are
any events or changes in condition since September 30, 1999 that have affected
Orchard's regulatory classification.

F-29
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
(Unaudited)
(000's omitted, except share amounts)

Orchard's actual capital amounts and ratios are presented in the following
table:

<TABLE>
<CAPTION>
To be well
capitalized
under prompt
For capital corrective
adequacy action
Actual purposes provisions
------------ ------------- -------------
Amount Ratio Amount Ratio Amount Ratio
------ ----- ------- ----- ------- -----
<S> <C> <C> <C> <C> <C> <C>
As of September 30, 1999:
Total capital (to risk weighted
assets)........................ 32,956 10.4% $25,390 >8.0% $31,738 >10.0%
Tier 1 capital (to risk weighted
assets) ....................... 31,175 9.8% 12,695 >4.0 19,043 >6.0
Tier 1 capital (to average
assets)........................ 31,175 8.2% 15,178 >4.0 18,973 >5.0
</TABLE>

8. Common Stock:

During 1999, the Company authorized and issued a new class of common
shares. The Class C Nonvoting common stock consists of 500,000 shares, $0.01
par value. During 1999, 299,078 shares were issued in exchange for 299,078
shares of Class B common stock.

The Class C common stock has preferential rights including, but not limited
to the following:

a) Liquidation preference over common stock, but equal to Class B common
stock.

b) Preemptive rights to acquire additional shares on a proportionate
basis if new shares are issued.

c) Registration demand rights.

d) Conversion to common stock.

During the third quarter 1999, the Company issued options to purchase
302,300 shares of Renaissance common stock having a $14.00 per share exercise
price. The Company is recording compensation expense for the difference
between the exercise price of $14.00 and the market value of $31.456 over the
vesting period of three years.

Compensation expense of $266.2 was recognized during the nine months ended
September 30, 1999. Cumulative and periodic expense to be recognized under the
current vesting schedule of these stock options is as follows:

<TABLE>
<CAPTION>
Expense for Cumulative
Period Ended the Period Expense
------------ ----------- ----------
<S> <C> <C>
Nine months ended September 30, 1999............... $ 266 $ 266
Three months ended December 31, 1999............... 483 749
Year ended December 31, 2000....................... 1,872 2,621
Year ended December 31, 2001....................... 1,867 4,488
Year ended December 31, 2002....................... 789 5,277
------
$5,277
======
</TABLE>

9. Significant Contracts:

The Company entered into a credit card alliance with a subsidiary of
Household International, Inc. ("Household") in April 1999. Under this
alliance, the Company markets and services certain credit card accounts for
the benefit of both Household and the Company.

F-30
<PAGE>

RENAISSANCE HOLDINGS, INC.

NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS--(Concluded)
(Unaudited)

In March 1999 and August 1998, the Company purchased distressed credit card
portfolios with receivables totaling $46.3 and $12.3 million, respectively
which were acquired at a discount. Chargeoffs against the acquired allowance on
these portfolios totaled $8.3 million for the nine months ended September 30,
1999.

10. Subsequent Event:

On December 2, 1999, Renaissance announced that it had signed a definitive
agreement on November 30, 1999 to be purchased by Household subject to
regulatory and shareholder approval. Household will exchange consideration to
be valued at $31.456 for each share of Renaissance common stock. Subject to
certain restrictions, Renaissance shares may be exchanged for cash, a
combination of cash and Household common stock or shares of Household common
stock, as elected by each Renaissance shareholder. The agreement and plan of
merger requires that Renaissance obtain the prior written consent of Household
prior to taking certain actions, including the issuance of any shares of
Renaissance common stock, entering into certain agreements and making capital
expenditures above specified thresholds.

General Electric Capital Corporation ("GECC") invested in Renaissance in
June 1997. As part of this investment GECC was issued a warrant by Renaissance
to purchase up to 1,396,082 shares of Renaissance common stock. Currently GECC
has the right to acquire 867,341 shares of Renaissance common stock at a price
of $2.507 per share pursuant to this warrant. In connection with the merger,
Household has agreed to purchase the warrant from GECC for $25.1 million
immediately upon completion of the merger. This amount was determined by taking
(i) the difference between $31.456 per share of Renaissance common stock less
the warrant strike price of $2.507 per share, which was then multiplied by (ii)
the number of shares of Renaissance common stock issuable under the warrant.
Additionally, GECC will permit Renaissance to repay, in full, the subordinated
notes due in 2003 issued by Renaissance in the amount of $3.5 million in
connection with the merger. There will be no premium or penalty assessed
against Renaissance for such early repayment.

To encourage certain employees of the Company and its subsidiaries to remain
in the employ of the surviving company following the merger, the Company's
Board has approved an incentive compensation plan, subject to the approval of
shareholders. In addition, employment agreements have been executed for four of
Renaissance's principal executive officers which will include non-compete
agreements.

The Company's Board has awarded Irving J. Levin a cash bonus in the amount
of $7.775 million in recognition of his past and current meritorious
performance. Such bonus is subject to certain conditions and will be paid prior
to the merger date.

F-31
<PAGE>

ANNEX A

Agreement and Plan of Merger

dated as of November 30, 1999

by and among

HOUSEHOLD INTERNATIONAL, INC.,

RENAISSANCE CREDIT SERVICES, INC.

and

RENAISSANCE HOLDINGS, INC.
<PAGE>

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
ARTICLE I--DEFINITIONS................................................... 1
Section 1.1 Definitions............................................. 1

Article II--THE MERGER................................................... 6
Section 2.1 The Merger.............................................. 6
Section 2.2 Effective Time of the Merger............................ 7
Section 2.3 Closing................................................. 7
Section 2.4 Effects of the Merger................................... 7
Section 2.5 Certificate of Incorporation and Bylaws................. 7
Section 2.6 Directors............................................... 7
Section 2.7 Officers................................................ 7

ARTICLE III--CONVERSION OF SHARES........................................ 7
Section 3.1 Conversion of Capital Stock of Merger Sub............... 7
Section 3.2 Conversion of Capital Stock of RHI...................... 7
Section 3.3 Exchange of Certificates................................ 8
Section 3.4 Proration............................................... 10
Section 3.5 Dividends, Fractional Shares, Etc....................... 10
Section 3.6 RHI Stock Options....................................... 11
Section 3.7 Tax Treatment........................................... 12
Section 3.8 Dissenters' Rights...................................... 12

ARTICLE IV--REPRESENTATIONS AND WARRANTIES OF RHI........................ 12
Section 4.1 Organization and Qualifications; Subsidiaries........... 12
Section 4.2 Articles of Incorporation or Charter and Bylaws......... 13
Section 4.3 Capitalization.......................................... 13
Section 4.4 Authority Relative to This Agreement.................... 13
No Conflict; Required Filings and Consents; Certain
Section 4.5 Contracts............................................... 13
Section 4.6 Compliance.............................................. 14
Section 4.7 Reports and Financial Statements........................ 14
Section 4.8 Absence of Certain Changes or Events.................... 15
Section 4.9 Litigation.............................................. 15
Section 4.10 Employee Benefit Plans.................................. 15
Section 4.11 Labor................................................... 17
Section 4.12 Insurance............................................... 17
Section 4.13 Brokers................................................. 18
Section 4.14 Taxes................................................... 18
Section 4.15 Environmental Matters................................... 18
Section 4.16 Loans................................................... 18
Section 4.17 Intellectual Property................................... 19
Section 4.18 Books and Records....................................... 19
Section 4.19 Transactions with Affiliates............................ 19
Section 4.20 Opinion of Financial Advisor............................ 19
Section 4.21 Reliance................................................ 20
ARTICLE V--REPRESENTATIONS AND WARRANTIES OF HOUSEHOLD AND MERGER SUB.... 20
Section 5.1 Organization and Qualifications; Subsidiaries........... 20
Section 5.2 Charter and Bylaws...................................... 20
Section 5.3 Capitalization.......................................... 20
Section 5.4 Authority Relative to This Agreement.................... 21
</TABLE>

A-i
<PAGE>

<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
Section 5.5 No Conflict; Required Filings and Consents.............. 21
Section 5.6 Compliance.............................................. 21
Section 5.7 SEC Reports and Financial Statements.................... 21
Section 5.8 Absence of Certain Changes or Events.................... 22
Section 5.9 Litigation.............................................. 22
Section 5.10 Insurance............................................... 22
Section 5.11 Brokers................................................. 22
Section 5.12 Taxes................................................... 23
Section 5.13 Reliance................................................ 23
Section 5.14 Financial Capability.................................... 23
ARTICLE VI--COVENANTS.................................................... 23
Section 6.1 Notification of Certain Matters......................... 23
Further Action, Reasonable Efforts; Consents and
Section 6.2 Approvals............................................... 23
Section 6.3 Regulatory Filings...................................... 24
Section 6.4 Conduct of Business of RHI Pending the Closing.......... 24
Section 6.5 Conduct of Business of Household Pending the Closing.... 26
Section 6.6 Access to Information................................... 26
Section 6.7 No Solicitation......................................... 26
Section 6.8 Stockholder Meeting..................................... 27
Section 6.9 Registration Statement and Proxy Statement.............. 27
Section 6.10 Letters of Accountants.................................. 28
Incentive Compensation Plan and Post-Closing Operation
Section 6.11 Intent.................................................. 28
Section 6.12 Public Announcements.................................... 28
Section 6.13 Blue Sky................................................ 29
Section 6.14 NYSE Listing............................................ 29
Section 6.15 Rule 145 Affiliates..................................... 29
Indemnification with Respect to the Registration
Section 6.16 Statement............................................... 29
Section 6.17 Directors' and Officers' Indemnification and Insurance.. 30
Section 6.18 Employee Matters........................................ 31
Section 6.19 Tax-Free Reorganization................................. 31
Section 6.20 Issuances with Respect to Option Cancellations.......... 32
ARTICLE VII--CONDITIONS TO THE MERGER.................................... 33
Conditions to Each Party's Obligation to Effect the
Section 7.1 Merger.................................................. 33
Section 7.2 Conditions to Obligations of RHI to Effect the Merger... 33
Conditions to Obligations of Household and Merger Sub to
Section 7.3 Effect the Merger....................................... 34
ARTICLE VIII--TERMINATION, WAIVER, AMENDMENT AND CLOSING................. 34
Section 8.1 Termination............................................. 34
Section 8.2 Effect of Termination................................... 35
Section 8.3 Amendment or Supplement................................. 35
Section 8.4 Extension of Time, Waiver, Etc.......................... 35
Section 8.5 Termination Fee......................................... 36

ARTICLE IX--MISCELLANEOUS................................................ 36
Section 9.1 Governing Law........................................... 36
Section 9.2 Entire Agreement........................................ 36
Section 9.3 Modification; Waiver.................................... 36
Section 9.4 Notices................................................. 36
Section 9.5 Expenses................................................ 37
Section 9.6 Assignment.............................................. 37
</TABLE>

A-ii
<PAGE>

<TABLE>
<CAPTION>
Page
----
<C> <S> <C>
Section 9.7 No Survival.............................................. 37
Section 9.8 Severability............................................. 37
Section 9.9 Successors and Assigns; Third Parties.................... 37
Section 9.10 Counterparts............................................. 38
Section 9.11 Interpretation; References............................... 38
Section 9.12 Dispute Resolution and Jurisdiction...................... 38
Section 9.13 Exhibits and Disclosure Letter........................... 38
Section 9.14 Attorneys' Fees.......................................... 38
Section 9.15 WAIVER OF JURY TRIAL..................................... 38
Section 9.16 Further Assurances....................................... 39
Section 9.17 Negotiation of Agreement................................. 39
</TABLE>

EXHIBITS

<TABLE>
<C> <S>
EXHIBIT A --Form of Rule 145 Affiliate Agreement
--Form of Legal Opinion of J. W. Blenke, Counsel to Household and
EXHIBIT B Merger Sub
EXHIBIT C --Form of Legal Opinion of Stoel Rives LLP, Counsel to RHI
EXHIBIT D --Form of GECC Stockholder Agreement
EXHIBIT E --Form of Stockholder Agreement
EXHIBIT F --Form of Tax Representation Letters
EXHIBIT G --Form of Incentive Plan
EXHIBIT H --Form of Employment Agreement
EXHIBIT I --Form of Loan Agreement
EXHIBIT J --Form of Certificate of Incorporation of Surviving Corporation
EXHIBIT K --Form of Bylaws of Surviving Corporation
EXHIBIT L --Form of Non-Competition Agreement
</TABLE>

A-iii
<PAGE>

AGREEMENT AND PLAN OF MERGER

Agreement And Plan Of Merger, dated as of November 30, 1999 (the
"Agreement"), by and among Household International, Inc., a Delaware
corporation ("Household"), Renaissance Credit Services, Inc., a Delaware
corporation and a wholly-owned direct subsidiary of Household ("Merger Sub"),
and Renaissance Holdings, Inc., an Oregon corporation ("RHI").

Whereas, Household, Merger Sub and RHI have determined that the merger of
RHI with and into Merger Sub on the terms set forth herein (the "Merger"), with
Merger Sub surviving as a wholly-owned direct subsidiary of Household, is
advisable and in the best interests of their respective corporations and
stockholders and their respective boards of directors have approved this
Agreement;
Whereas, to satisfy a condition to Household and RHI entering into this
Agreement and incurring the obligations set forth herein, concurrently with the
execution and delivery of this Agreement, certain stockholders of RHI have
entered into a Stockholder Agreement with Household and RHI pursuant to which
such stockholders have agreed, on the terms and subject to the conditions
thereof, to, among other things, waive and relinquish all rights the
stockholders may have to purchase shares of RHI Common Stock pursuant to a
Transfer Agreement, as defined herein, and to hold Household Common Stock after
the Effective Time;

Whereas, to satisfy a condition to Household and RHI entering into this
Agreement and incurring the obligations set forth herein, concurrently with the
execution and delivery of this Agreement, GECC, as defined herein, has entered
into a GECC Stockholder Agreement with Household and RHI pursuant to which GECC
has agreed, among other things, to waive various provisions of the Transfer
Agreement and the GECC Warrant, as defined herein;

Whereas, by executing this Agreement, the parties intend to adopt a plan of
reorganization within the meaning of Section 368 of the Internal Revenue Code
of 1986, as amended.

Now, Therefore, in consideration of the mutual representations, warranties
and agreements contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound hereby, agree as follows:

ARTICLE I

DEFINITIONS

Section 1.1 Definitions. The capitalized terms used in this Agreement and
not otherwise defined shall have the following meanings (unless the context
otherwise requires, such capitalized terms shall include the singular and
plural and the conjunctive and disjunctive forms of the terms defined):

"Acquisition Proposal" shall have the meaning set forth in Section 6.7.

"Affiliate" shall mean, as to any Person, any other Person controlling,
controlled by, or under common control with such Person.

"Average Household Stock Price" shall have the meaning set forth in Section
3.2.

"Benefit Arrangement" shall mean any benefit arrangement, obligation, or
practice, whether or not legally enforceable, to provide benefits (other than
merely as salary or under a Benefit Plan), as compensation for services
rendered, to present or former directors, employees, agents, or independent
contractors, including, but not limited to, employment or consulting
agreements, severance agreements or pay policies, executive or incentive
compensation programs or arrangements, sick leave, maternity and parental
leave, vacation pay, plan closing benefits, salary continuation for disability,
workers' compensation, retirement, deferred compensation, bonus, stock option,
stock appreciation rights, or purchase, tuition reimbursement or scholarship
programs, employee discount programs, meals, travel, or vehicle allowances,
employee loans, employee banking, any plans subject to Section 125 of the Code,
and any plans providing benefits or payments in the event of a change of
control, change in ownership or effective control, or sale of a substantial
portion (including all or substantially all) of the assets of any business or
portion thereof, in each case with respect to any present or former employees,
directors, or agents. Benefit Arrangements exclude any employment agreements
that would, by their terms, terminate on or before the Closing Date and those
that could be terminated immediately after the Closing Date without additional
expense to the RHI Companies or any successor thereto.

A-1
<PAGE>

"Benefit Plan" shall mean an employee benefit plan as defined in Section
3(3) of ERISA together with plans or arrangements that would be so defined if
they were not (i) otherwise exempt from ERISA by that or another section, (ii)
maintained outside the United States, or (iii) individually negotiated or
applicable only to one person.

"Blue Sky Laws" shall mean the securities laws of the states of the United
States as currently in effect.

"Business Day" shall mean any day other than a Saturday, a Sunday or a day
on which banking institutions in Chicago, Illinois or New York City, New York
are not required to be open.

"Cash Cap" shall have the meaning set forth in Section 3.4.

"Cash Election" shall have the meaning set forth in Section 3.2.

"Cash Consideration" shall mean $31.456.

"Cash Merger" shall have the meaning set forth in Section 3.2.

"Certificate of Merger" shall have the meaning set forth in Section 2.2.

"Certificate" shall have the meaning set forth in Section 3.2.

"Claims" shall have the meaning set forth in Section 4.9.

"Closing" shall have the meaning set forth in Section 2.3.

"Closing Date" shall have the meaning set forth in Section 2.3.

"Code" shall mean the Internal Revenue Code of 1986, as amended.

"Confidential Information" shall have the meaning set forth in Section 6.6.

"Consents" shall have the meaning set forth in Section 6.2.

"Contract" shall mean, with respect to any Person, any note, bond,
indenture, lease, license, permit, franchise, deed of trust, mortgage, loan
agreement or other document, instrument, obligation or agreement to which such
Person or any of its subsidiaries is a party or by which any of them or their
assets or properties is bound or affected.

"DGCL" means the General Corporation Law of the State of Delaware.

"Disclosure Letter" shall mean the letter dated as of the date of this
Agreement from RHI to Household and Merger Sub and attaching the schedules
referred to in this Agreement.

"Dissenting Shares" shall have the meaning set forth in Section 3.8.

"Effective Day" shall mean the day on which the Effective Time occurs.

"Effective Time" shall have the meaning set forth in Section 2.2.

"Election Deadline" shall have the meaning set forth in Section 3.3.

"Election Form" shall have the meaning set forth in Section 3.3.

A-2
<PAGE>

"Employment Agreements" shall mean the employment agreements or amendments
to employment agreements between certain officers of RHI, as identified by
Household, and RHI, Merger Sub and or Household in substantially the form of
Exhibit H.

"EPA" shall have the meaning set forth in Section 4.15.

"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended (including without limitation any successor act), and the rules and
regulations issued thereunder.

"ERISA Affiliate" shall mean any Person that together with the entity
referenced would be or was at any time treated as a single employer under
Section 414 of the Code or Section 4001 of ERISA and any general partnership of
which any of the RHI Companies is or has been a general partner.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

"Exchange Agent" shall have the meaning set forth in Section 3.3.

"Exchange Ratio" shall have the meaning set forth in Section 3.2.

"Fixed Cash Amount" shall have the meaning set forth in Section 3.4.

"GAAP" shall mean generally accepted accounting principles.

"GECC" shall mean General Electric Capital Corporation, a New York
corporation.

"GECC Stockholder Agreement" shall mean the agreement between GECC, RHI and
Household in the form attached hereto as Exhibit D.

"GECC Warrant" shall mean that Warrant to Purchase Class B Common Stock, par
value $.01 per share, of RHI dated June 10, 1997, and all warrants issued upon
transfer, division or combination of, or in substitution for, that warrant.

"Governmental Authority" shall mean any government or any agency, bureau,
board, commission, court, judicial or quasi-judicial body, department,
authority, official, political subdivision, tribunal or other instrumentality
of any government, whether Federal, state or local, domestic or foreign.

"Household Common Stock" shall mean Common Stock, par value $1.00 per share,
of Household.

"Household Registration Statement" shall have the meaning set forth in
Section 6.9.

"Household SEC Reports" shall have the meaning set forth in Section 5.7.

"Household Stock Plans" shall have the meaning set forth in Section 5.3.

"Household Stock Price" shall have the meaning set forth in Section 3.2.

"HSR Act" shall have the meaning set forth in Section 4.5.

"IRS" shall mean the United States Internal Revenue Service or any successor
agency.

"Incentive Plan" shall have the meaning set forth in Section 6.11.

"Indemnified Officers/Directors" shall have the meaning set forth in Section
6.17.

"Indemnified Party" shall have the meaning set forth in Section 6.16.

A-3
<PAGE>

"Indemnifying Party" shall have the meaning set forth in Section 6.16.

"Intellectual Property" shall have the meaning set forth in Section 4.17.

"Knowledge" shall mean, with respect to RHI, the actual knowledge, without
further inquiry, of Irving J. Levin, George F. Alexander, Charles B. Engelberg,
Karen D. Frolich, Ruth M. Scherbarth, Gary Barth, Brian Enneking, Glenda
Goodrich, Jay Hemmady, Elaine Howard, Jeanne Muenchau, Kirt Nelson, or E.
Lenice Shaw.

"Law" shall mean any law, statute, rule, regulation, ordinance, decree or
order of any Governmental Authority.

"Lien" shall mean any mortgage, pledge, assessment, security interest,
lease, sublease, lien, adverse claim, levy, charge, option, right of others or
restriction (whether on voting, sale, transfer, disposition or otherwise) or
other encumbrance of any kind, whether imposed by agreement, understanding, law
or equity, or any conditional sale contract, title retention contract or other
contract to give or to refrain from giving any of the foregoing.

"Loans" shall have the meaning set forth in Section 4.16.

"Loan Agreement" shall mean one or more loan agreements or notes (and the
related Pledge and Custody Agreement) between an affiliate of Household and
Irving J. Levin, substantially in the form of Exhibit I for such amount as
designated by Irving J. Levin up to an aggregate principal amount for all such
loan agreements or notes of $28.0 million and secured by Household Common Stock
or RHI Common Stock with a market value of at least two times the amount
outstanding from time to time.

"Losses" shall have the meaning set forth in Section 6.17.

"Material Adverse Effect" shall mean, with respect to any Person, a material
adverse effect on (i) the validity or enforceability of this Agreement, (ii)
the ability of such Person to perform its obligations under this Agreement or
(iii) the business, assets, financial condition or results of operations of the
Person and its subsidiaries, taken as a whole; provided, however, that any
adverse change, event or effect that is caused (a) by the announcement of the
Merger or by virtue of the Merger Agreement, including, without limitation,
compliance by such Person with its covenants set forth in this Agreement or (b)
by the breach by the other Person of any covenant or obligation set forth in
this Agreement shall not be taken into account in determining whether there has
been a Material Adverse Effect. In no event shall any of the following
constitute a Material Adverse Effect: (i) any change in the trading price of
Household's equity securities between the date hereof and the Effective Time,
in and of itself; (ii) effects, changes, events, circumstances or conditions
outside the control of the Person generally affecting the industry or
industries in which Household or RHI operates or arising from changes in
prevailing interest rate, economic or market conditions; and (iii) any effects,
changes, events, circumstances or conditions resulting from any change in law
or GAAP, which affect generally entities such as Household or RHI.

"Material Subsidiary" shall mean, with respect to any Person, a subsidiary
of such Person that (i) constitutes a "significant subsidiary" of such Person,
within the meaning of Rule 1-02 of Regulation S-X of the SEC, (ii) has a direct
or indirect ownership interest in any other subsidiary of such Person that is a
Material Subsidiary of such Person, or (iii) is otherwise material to the
business or operations of such Person and its subsidiaries, taken as a whole.

"Merger" shall have the meaning set forth in the preamble to this Agreement.

"Merger Consideration" shall have the meaning set forth in Section 3.2.

"Merger Filing" shall have the meaning set forth in Section 2.2.

"Miscellaneous Non-Qualified Options" shall mean Options to purchase RHI
Common Stock issued as director or committee chair compensation, or pursuant to
the 1996 financings undertaken by Renaissance Bankcard Services, all as
described in Schedule 4.3 to the Disclosure Letter.

"NYSE" means the New York Stock Exchange, Inc.

"Notices" shall have the meaning set forth in Section 9.4.

"OCL" shall mean the Oregon Business Corporation Act.

A-4
<PAGE>

"Option" shall mean, with respect to any Person, any option, warrant, call,
right, subscription, convertible or exchangeable security or other right,
agreement, arrangement or commitment of any kind or character to which such
Person or any of its subsidiaries is a party relating to the issued or unissued
capital stock of such Person or any of its subsidiaries, or obligating such
Person or any of its subsidiaries to issue, transfer, grant or sell any shares
of capital stock of, or other equity interest in, or securities convertible
into or exchangeable for any capital stock or other equity interest in, such
Person or any of its subsidiaries.

"Option Exchange Ratio" shall have the meaning set forth in Section 3.6.

"Organizational Documents" shall mean (i) with respect to a corporation or
association, its certificate or articles of incorporation or association and
bylaws, (ii) with respect to any limited liability company, its certificate of
formation, articles of organization, regulations, operating agreement and
limited liability company agreement, as applicable, (iii) with respect to any
limited partnership, its certificate of limited partnership and limited
partnership agreement, (iv) with respect to any general partnership, its
partnership agreement, and (v) all other similar organizational documents.

"Person" shall mean any natural person, corporation, general partnership,
limited partnership, limited liability company, limited liability partnership,
proprietorship, trust, union, association, court, tribunal, agency, government,
department, commission, self-regulatory organization, arbitrator, board,
bureau, instrumentality or other entity, enterprise, authority or business
organization.

"Pricing Period" shall have the meaning set forth in Section 3.2.

"Prorated Cash Amount" shall have the meaning set forth in Section 3.4.

"Prorated Share Amount" shall have the meaning set forth in Section 3.4.

"Proxy Statement" shall have the meaning set forth in Section 6.9.

"Qualified Plan" shall mean any RHI Plan intended to meet the requirements
of Section 401(a) of the Code, including any previously terminated plan.

"Representatives" means, with respect to any Person, the officers,
directors, employees, auditors and other agents and representatives of such
Person.

"Requested Cash Amount" shall have the meaning set forth in Section 3.4.

"Requested Share Amount" shall have the meaning set forth in Section 3.4.

"Requisite Regulatory Approvals" shall have the meaning set forth in Section
4.5.

"RHI 401(k) Plan" shall have the meaning set forth in Section 4.10.

"RHI Benefit Arrangement" shall mean any Benefit Arrangement any of the RHI
Companies sponsors or maintains or with respect to which any of the RHI
Companies has or may have any liability (whether actual or contingent, with
respect to any of its assets or otherwise), in each case with respect to any
present or former service provider to the RHI Companies.

"RHI Common Stock" shall mean the Class C common stock, par value $.01 per
share, the Class B common stock, par value $.01 per share, and the common
stock, par value $.01 per share, of RHI.

"RHI Companies" shall mean RHI and any subsidiary of RHI that currently has
or previously had employees.

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"RHI Financial Advisor" shall have the meaning set forth in Section 4.13.

"RHI Meeting" shall have the meaning set forth in Section 6.8.

"RHI Option Plan" shall have the meaning set forth in Section 3.6.

"RHI Plan" shall mean any Benefit Plan that RHI or any ERISA Affiliate
maintains or has maintained or to which any such entity is obligated to make
payments or has or may have any liability, in each case with respect to any
present or former employees of the RHI Companies. RHI Plan shall include any
Qualified Plan terminated within the preceding six years.

"RHI Reports" shall have the meaning set forth in Section 4.7.

"RHI Stock Options" shall have the meaning set forth in Section 3.6.

"RHI Stockholder Approval" shall have the meaning set forth in Section 6.8.

"Rule 145 Affiliate Agreement" shall have the meaning set forth in Section
6.15.

"Rule 145 Affiliates" shall have the meaning set forth in Section 6.15.

"SEC" shall mean the Securities and Exchange Commission.

"Securities Act" shall mean the Securities Act of 1933, as amended.

"Share Cap" shall have the meaning set forth in Section 3.4.

"Standard Election" shall have the meaning set forth in Section 3.2.

"Stock Election" shall have the meaning set forth in Section 3.2.

"Stock Election Exchange Ratio" shall have the meaning set forth in Section
3.2.

"Stockholder Agreement" shall mean an agreement among certain stockholders
of RHI and Household in the form attached hereto as Exhibit E.

"subsidiary" of an entity shall mean any entity required by GAAP to be
consolidated in the financial statements of such entity.

"Suit" shall have the meaning set forth in Section 9.12.

"Surviving Corporation" shall have the meaning set forth in Section 2.1.

"Tax" or "Taxes" shall mean all Federal, state, local and foreign taxes and
other assessments and governmental charges of a similar nature (whether imposed
directly or through withholdings), including any interest, penalties and
additions to Tax applicable thereto.

"Tax Returns" shall mean all Federal, state, local and foreign returns,
declarations, statements, reports, schedules, forms and information returns
relating to Taxes, and all amendments thereto.

"Trading Day" shall mean a day on which Household Common Stock is traded on
the NYSE.

"Transactions" means the transactions contemplated by this Agreement in
Article II.

"Transfer Agreement" shall mean the Transfer Restriction Agreement dated as
of June 10, 1997, by and among RHI, Irving J. Levin, GECC and the RHI
stockholders identified therein.

ARTICLE II

THE MERGER

Section 2.1 The Merger. Upon the terms and subject to the conditions of this
Agreement, at the Effective Time, in accordance with the OCL and DGCL, RHI
shall be merged with and into Merger Sub in accordance with this Agreement and
the separate existence of RHI shall cease; provided, however, that if the
Merger is a Cash Merger (as defined in Section 3.2), then Merger Sub shall be
merged with and into RHI and the separate existence of Merger Sub shall cease
and all references in this Agreement that contemplate the merger of RHI into
Merger Sub shall be deemed to be changed to contemplate the merger of Merger
Sub into RHI. Merger Sub shall be the surviving corporation in the Merger
(hereinafter sometimes referred to as the "Surviving Corporation").

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Section 2.2 Effective Time of the Merger. Upon the terms and subject to the
conditions hereof, a certificate of merger/articles of merger (the "Certificate
of Merger") shall be duly prepared, executed and acknowledged by the Surviving
Corporation and thereafter delivered to the Secretaries of State of the States
of Delaware and Oregon, for filing on the Closing Date (as defined in Section
2.3). The Merger shall become effective as of the date and at such time as each
of the Certificate of Merger, pursuant to Section 252 of the DGCL, and the
Articles of Merger, pursuant to Section 60.494 of the OCL, and any other
documents necessary to effect the Merger in accordance with the DGCL and OCL
are duly filed (the "Merger Filing") with the Secretaries of State of the
States of Delaware and Oregon or at such subsequent date or time as shall be
agreed by Household and RHI and specified in the Certificate and Articles of
Merger (the time the Merger becomes effective pursuant to the DGCL and OCL
being referred to herein as the "Effective Time").

Section 2.3 Closing. Subject to the satisfaction or waiver of all of the
conditions to closing contained in Article VII, the closing of the Merger (the
"Closing") will take place at such time and such date as specified by the
parties, which shall be no later than the first Business Day after the
satisfaction or waiver of the conditions to Closing contained in Article VII,
at the offices of Stoel Rives LLP, 700 NE Multnomah, Portland, Oregon 97232,
unless another date, time or place is agreed to in writing by the parties
hereto. The date and time at which the Closing occurs is referred to herein as
the "Closing Date."

Section 2.4 Effects of the Merger. The Merger shall have the effects set
forth in the DGCL and OCL. Without limiting the generality of the foregoing,
and subject thereto, at the Effective Time, all the properties, rights,
privileges, powers and franchises of RHI and Merger Sub shall vest in the
Surviving Corporation, and all debts, liabilities and duties of RHI and Merger
Sub shall become the debts, liabilities and duties of the Surviving
Corporation.

Section 2.5 Certificate of Incorporation and Bylaws. Subject to Section
6.17, the Certificate of Incorporation of the Surviving Corporation shall be in
the form set forth in Exhibit J to this Agreement. The Bylaws of the Surviving
Corporation shall be in substantially the form set forth in Exhibit K to this
Agreement.

Section 2.6 Directors. The directors of the Surviving Corporation shall be
as set forth on Schedule 2.6 to the Disclosure Letter, each to hold office from
the Effective Time in accordance with the Certificate of Incorporation and
Bylaws of the Surviving Corporation and until his or her successor is duly
elected and qualified.

Section 2.7 Officers. The officers of the Surviving Corporation shall be as
set forth on Schedule 2.7 to the Disclosure Letter, each to hold office from
the Effective Time in accordance with the Certificate of Incorporation and
Bylaws of the Surviving Corporation and until his or her successor is duly
appointed and qualified.

ARTICLE III

CONVERSION OF SHARES

Section 3.1 Conversion of Capital Stock of Merger Sub. At the Effective
Time, each issued and outstanding share of common stock, par value $1.00 per
share, of Merger Sub shall be converted into and become one fully paid and
nonassessable share of common stock, par value $1.00 per share, of the
Surviving Corporation.

Section 3.2 Conversion of Capital Stock of RHI. (a) Except as otherwise
provided in Section 3.2(b), Section 3.4, Section 3.5 and Section 3.8, at the
Effective Time, each issued and outstanding share of RHI Common Stock shall be
converted into the right to receive (i) that number of shares of Household
Common Stock equal to a fraction (the "Exchange Ratio"), the numerator of which
will be 5,000,000 and the denominator of which will be the number of shares of
RHI Common Stock outstanding immediately prior to the Effective Time minus the
number of Dissenting Shares and (ii) cash in an amount equal to the difference

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between (x) the Cash Consideration minus (y) the product of the Exchange Ratio
and the Household Stock Price (items (i) and (ii) together constituting the
"Merger Consideration"); provided, however, that if the product of the Exchange
Ratio and the Household Stock Price is greater than the Cash Consideration, the
Exchange Ratio shall be reduced so that the product of the Exchange Ratio as
adjusted and the Household Stock Price is equal to the Cash Consideration; and
provided, further, that if the average of the high and low sales prices per
share of Household Common Stock on the NYSE as reported in The Wall Street
Journal (Midwest Edition) (and confirmed by the RHI Financial Advisor and
Lehman Brothers) for the Closing Date is less than $28.00, the Merger
Consideration shall be solely cash, without interest, in an amount equal to the
Cash Consideration (such circumstance is referred to in this Agreement as the
"Cash Merger").

(b) Except as otherwise provided in Section 3.4, Section 3.5 and Section 3.8
and subject to Section 3.2(d) and Section 3.3(e), unless the Merger is a Cash
Merger, each holder of shares of RHI Common Stock may elect to receive the
consideration provided for by Section 3.2(a) (the "Standard Election") or
either of the following:

(i) for each share of RHI Common Stock with respect to which an election
to receive solely Household Common Stock has been effectively made and not
revoked or lost pursuant to Section 3.3 (a "Stock Election"), the right to
receive that number of shares of Household Common Stock equal to the Stock
Election Exchange Ratio, where the "Stock Election Exchange Ratio" is equal
to the Cash Consideration divided by the Household Stock Price; or

(ii) for each share of RHI Common Stock with respect to which an
election to receive solely cash has been effectively made and not revoked
or lost pursuant to Section 3.3 (a "Cash Election"), the right to receive
in cash, without interest, an amount equal to the Cash Consideration;

provided, however, that a holder of shares received pursuant to Section 6.20 of
this Agreement may only make a Stock Election with respect to such shares.

(c) The "Household Stock Price" shall equal the Average Household Stock
Price as calculated in the next sentence except that if the Average Household
Stock Price is less than $41.875, then the Household Stock Price shall be
$41.875 and if the Average Household Stock Price is greater than $43.50, then
the Household Stock Price shall be $43.50. The "Average Household Stock Price"
shall mean (i) the sum of the daily average high and low sales prices per share
of Household Common Stock on the NYSE as reported in The Wall Street Journal
(Midwest Edition) (and confirmed by the RHI Financial Advisor and Lehman
Brothers) for each of the twenty consecutive Trading Days ending on the Trading
Day that is the Trading Day prior to the day of the RHI Meeting (the "Pricing
Period"), divided by (ii) twenty.

(d) As a result of the Merger and without any action on the part of the
holders thereof, at the Effective Time, all shares of RHI Common Stock shall no
longer be outstanding and shall automatically be cancelled and retired and
shall cease to exist, and each holder of shares of RHI Common Stock shall
thereafter cease to have any rights with respect to such shares of RHI Common
Stock, except (i) the right to receive, without interest, the Merger
Consideration and cash for fractional shares of Household Common Stock in
accordance with Section 3.5 upon the surrender of a certificate that,
immediately prior to the Effective Time, represented an outstanding share or
shares of RHI Common Stock (a "Certificate"); or (ii) the dissenters' rights
described in Section 3.8.

(e) Notwithstanding anything contained in this Section 3.2 to the contrary,
each share of RHI Common Stock issued and held in RHI's treasury or by a
wholly-owned subsidiary of RHI immediately prior to the Effective Time, and
each share of RHI Common Stock or Option owned by Household or Merger Sub at or
immediately prior to the Effective Time, if any, shall, by virtue of the
Merger, cease to be outstanding and shall be cancelled and retired and shall
cease to exist without payment of any consideration therefor.

Section 3.3 Exchange of Certificates. (a) Each person who is a record holder
of shares of RHI Common Stock as of the Effective Time (other than holders of
Dissenting Shares) shall have the right to submit an Election Form (as defined
in Section 3.3(c)) specifying the number of shares of RHI Common Stock that
such

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person desires to have converted into the right to receive Household Common
Stock and cash pursuant to the Standard Election, the number of shares of RHI
Common Stock that such person desires to have converted into the right to
receive Household Common Stock pursuant to the Stock Election, and the number
of shares of RHI Common Stock that such person desires to have converted into
the right to receive cash pursuant to the Cash Election.

(b) Promptly after the Effective Time, Household shall deposit (or cause to
be deposited) with Harris Trust & Savings Bank (the "Exchange Agent"), for the
benefit of the holders of shares of RHI Common Stock, for exchange in
accordance with this Article III, (i) cash in the amount sufficient to pay the
aggregate cash portion of the Merger Consideration and cash in lieu of
fractional shares and (ii) certificates representing the aggregate number of
shares of Household Common Stock that may be issued to pay the stock portion of
the Merger Consideration. Household Common Stock into which RHI Common Stock
shall be converted pursuant to the Merger shall be deemed to have been issued
at the Effective Time.

(c) Within two (2) Business Days after the Effective Time, Household shall
cause the Exchange Agent to mail to each holder of record of RHI Common Stock
immediately prior to the Effective Time (excluding any Dissenting Shares) (i) a
letter of transmittal (which shall specify that delivery shall be effected, and
risk of loss and title to the Certificates shall pass, only upon delivery of
the Certificates to the Exchange Agent), which shall be in customary form with
such customary provisions as Household shall reasonably specify (the "Letter of
Transmittal"), (ii) instructions for use in effecting the surrender of the
Certificates in exchange for the Merger Consideration and (iii) an election
form (the "Election Form") providing for such holders to make the Standard
Election, the Stock Election or the Cash Election. As of the Election Deadline
(as hereinafter defined) all holders of RHI Common Stock immediately prior to
the Effective Time that shall not have submitted to the Exchange Agent or shall
have properly revoked an effective, properly completed Election Form shall be
deemed to have made a Standard Election.

(d) Any Standard Election (other than a deemed Standard Election), Stock
Election or Cash Election shall have been validly made only if the Exchange
Agent shall have received by 5:00 p.m. Chicago, Illinois time on a date (the
"Election Deadline") that is ten (10) Business Days after the date the Letter
of Transmittal is mailed to holders, an Election Form properly completed and
executed (with the signature or signatures thereof guaranteed to the extent
required by the Election Form) by such holder accompanied by such holder's
Certificates. Any holder of RHI Common Stock who has made an election by
submitting an Election Form to the Exchange Agent may at any time prior to the
Election Deadline change such holder's election by submitting a revised
Election Form, properly completed and signed that is received by the Exchange
Agent prior to the Election Deadline. Any holder of RHI Common Stock may revoke
this election and withdraw his Certificates deposited with the Exchange Agent
by written notice to the Exchange Agent received by the close of business on
the Business Day prior to the Election Deadline.

(e) Upon surrender of a Certificate, in such form and with such
endorsements, stock powers and signature guaranties as may be required by the
Letter of Transmittal for cancellation to the Exchange Agent or to such other
agent or agents as may be appointed by Household, together with the Letter of
Transmittal, duly executed, and such other documents as Household or the
Exchange Agent shall reasonably request, the holder of such Certificate shall
be entitled to receive in exchange therefor promptly after the Effective Time,
(i) a check in an amount equal to the cash which such holder has the right to
receive pursuant to the provisions of this Article III and (ii) a certificate
representing the number of shares of Household Common Stock which such holder
has the right to receive pursuant to the provisions of this Article III (in
each case, less the amount of any required withholding taxes), and the
Certificate so surrendered shall forthwith be cancelled. Until surrendered as
contemplated by this Section 3.3(e), each Certificate shall be deemed at any
time after the Effective Time to represent only the right to receive the Merger
Consideration with respect to the shares of RHI Common Stock formerly
represented thereby.

(f) Household shall have the right to make rules, not inconsistent with the
terms of this Agreement, governing the validity of the Election Forms, the
manner and extent to which Standard Elections, Stock

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Elections or Cash Elections are to be taken into account in making the
determinations prescribed in Section 3.4, the issuance and delivery of the
certificates for Household Common Stock into which shares of RHI Common Stock
are converted in the Merger, and the payment of cash for shares of RHI Common
Stock converted in the Merger.

Section 3.4 Proration. (a) As is more fully set forth below, unless the
Merger is a Cash Merger the aggregate amount of cash to be paid to holders of
shares of RHI Common Stock (the "Fixed Cash Amount") shall equal the amount of
cash that would have been paid if all holders of shares of RHI Common Stock had
made a Standard Election.

(b) In the event that the aggregate amount of cash represented by the Cash
Elections received by the Exchange Agent (the "Requested Cash Amount") exceeds
the Fixed Cash Amount minus the aggregate amount of cash represented by the
Standard Elections received (or deemed received) by the Exchange Agent (such
difference, the "Cash Cap"), each holder making a Cash Election shall receive,
for each share of RHI Common Stock for which a Cash Election has been made, (i)
cash in an amount equal to the product of the Cash Consideration and a
fraction, the numerator of which is the Cash Cap and the denominator of which
is the Requested Cash Amount (such product, the "Prorated Cash Amount") and
(ii) a number of shares of Household Common Stock equal to a fraction, the
numerator of which is equal to the Cash Consideration minus the Prorated Cash
Amount and the denominator of which is the Household Stock Price.

(c) In the event that the aggregate amount of shares represented by the
Stock Elections received by the Exchange Agent (the "Requested Share Amount")
exceeds 5,000,000 minus the aggregate amount of shares represented by the
Standard Elections received (or deemed received) by the Exchange Agent (such
difference, the "Share Cap"), each holder making a Stock Election shall
receive, for each share of RHI Common Stock for which a Stock Election has been
made, (i) a number of shares equal to the product of the Stock Election
Exchange Ratio and a fraction, the numerator of which is the Share Cap and the
denominator of which is the Requested Share Amount (such product, the "Prorated
Share Amount") and (ii) cash in an amount equal to the Cash Consideration minus
the product of the Prorated Share Amount and the Household Stock Price.

Section 3.5 Dividends, Fractional Shares, Etc. (a) Notwithstanding any other
provisions of this Agreement, no dividends or other distributions declared
after the Effective Time on Household Common Stock shall be paid to the holder
of any unsurrendered Certificates until such Certificates are surrendered for
exchange as provided in this Article III. Subject to the effect of applicable
laws, following the surrender of any such Certificate, there shall be paid,
without interest, to the Person in whose name the certificates representing the
shares of Household Common Stock into which the shares of RHI Common Stock
formerly represented by such Certificate were converted are registered, (i) at
the time of such surrender, the amount of all dividends and other distributions
with a record date after the Effective Time theretofore payable with respect to
such whole shares of Household Common Stock and not paid, less the amount of
any withholding taxes which may be required thereon, and (ii) at the
appropriate payment date, the amount of dividends or other distributions with a
record date after the Effective Time but prior to surrender and a payment date
subsequent to surrender payable with respect to such whole shares of Household
Common Stock, less the amount of any withholding taxes which may be required
thereon.

(b) No fractional shares of Household Common Stock shall be issued in the
Merger. All fractional shares of Household Common Stock that a holder of shares
of RHI Common Stock would otherwise be entitled to receive as a result of the
Merger shall be aggregated and, if a fractional share results from such
aggregation, such holder shall be entitled to receive, in lieu thereof, an
amount in cash determined by multiplying (i) the fraction of a share of
Household Common Stock to which such holder would otherwise have been entitled
by (ii) the Household Stock Price. No interest will be paid or will accrue on
any cash paid or payable in lieu of any fractional shares of Household Common
Stock.

(c) At and after the Effective Time, there shall be no further registration
of transfers of shares of RHI Common Stock. If, after the Effective Time,
Certificates are presented to the Surviving Corporation, they shall

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be cancelled and exchanged for the Merger Consideration, and in accordance with
the procedures set forth, in this Article III. Certificates surrendered for
exchange by any Person constituting an "Affiliate" of RHI for purposes of Rule
145(c) under the Securities Act shall not be exchanged until Household has
received a written Rule 145 Affiliate Agreement from such Person as provided in
Section 6.15.

(d) If any portion of the Merger Consideration is to be paid to a Person
other than the registered holder of the shares of RHI Common Stock represented
by the Certificate or Certificates surrendered in exchange therefor, it shall
be a condition to such payment that the Certificate or Certificates so
surrendered shall be properly endorsed or otherwise be in proper form for
transfer and that the Person requesting such payment shall pay to the Exchange
Agent any transfer or other taxes required as a result of such payment to a
Person other than the registered holder of such Certificates or establish to
the satisfaction of the Exchange Agent that such tax has been paid or is not
payable.

(e) Any portion of the Merger Consideration or cash payable in lieu of
fractional shares made available to the Exchange Agent pursuant to this Article
III that remains unclaimed by the former holders of shares of RHI Common Stock
one year after the Effective Time shall be delivered to Household. Any such
holder who has not theretofore exchanged his Certificates for the Merger
Consideration in accordance with this Article III shall thereafter look only to
Household for payment of the applicable Merger Consideration, cash in lieu of
fractional shares and unpaid dividends and distributions on the Household
Common Stock deliverable in respect thereof, determined pursuant to this
Agreement, in each case, without interest. None of Household, RHI or the
Surviving Corporation shall be liable to any former holder of shares of RHI
Common Stock for any amount paid to a Governmental Authority pursuant to any
applicable abandoned property, escheat or similar laws. Any amounts remaining
unclaimed by holders of Certificates five years after the Effective Time (or
such earlier date immediately prior to such time as such amounts would
otherwise escheat to or become the property of any Governmental Authority)
shall, to the extent permitted by applicable law, become the property of
Household free and clear of any claims or interest of any person previously
entitled thereto.

(f) In the event that any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed and, if required by Household,
the posting by such Person of a bond in a customary amount as indemnity against
any claim that may be made against it with respect to such Certificate, the
Exchange Agent will issue in exchange for such lost, stolen or destroyed
Certificate the applicable Merger Consideration, cash in lieu of fractional
shares, and unpaid dividends and distributions on shares of Household Common
Stock deliverable in respect thereof pursuant to this Agreement.

(g) If at any time during the period between the date of this Agreement and
the Effective Time, any change in the outstanding shares of capital stock of
Household shall occur, including by reason of any reclassification,
reorganization, recapitalization, stock split or combination, exchange or
readjustment of shares, or any stock dividend thereon with a record date during
such period, the number of shares of Household Common Stock constituting all or
part of the Merger Consideration shall be appropriately adjusted in accordance
with such change.

Section 3.6 RHI Stock Options. At the Effective Time, all Options to
purchase shares of RHI Common Stock granted to employees, consultants,
directors, investors, agents or advisors (other than those identified in
Schedule 7.3(f) to the Disclosure Letter of this Agreement) (each a "RHI Stock
Option") pursuant to the IJL Corporation 1991 Stock Incentive Plan, TL
Holdings, Inc. 1996 Stock Incentive Plan, Renaissance Holdings, Inc. 1997 Stock
Incentive Plan, Renaissance Holdings, Inc. Amended and Restated 1997 Stock
Incentive Plan, or as Miscellaneous Non-Qualified Options (collectively, the
"RHI Option Plans"), whether or not exercisable, will be assumed by Household;
provided, however, that if the Merger is a Cash Merger, then each such Option
will be converted into the right to receive, for each share of common stock of
RHI into which the Option is or may become exercisable, a payment in cash,
without interest, in an amount equal to the difference between the Cash
Consideration and the exercise price of the Option. Each RHI Stock Option
assumed by Household under this Agreement will, in compliance with all
applicable laws, continue to have, and be subject to, the same terms

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and conditions set forth in the applicable RHI Option Plan immediately prior to
the Effective Time and the stock option agreement by which it is evidenced,
except that (i) each such RHI Stock Option will be exercisable for that number
of whole shares (and no fractional shares) of Household Common Stock equal to
the product of the number of shares of RHI Common Stock that were issuable upon
the exercise of such RHI Stock Option multiplied by the number determined by
dividing (w) the Cash Consideration by (x) the Household Stock Price, rounded
down to the nearest whole cent (the "Option Exchange Ratio") and (ii) the per
share exercise price for the shares of Household Common Stock issuable upon the
exercise of such assumed RHI Stock Option will be equal to the quotient
determined by dividing the exercise price per share of RHI Common Stock at
which such RHI Stock Option would have been exercisable immediately prior to
the Effective Time by the Option Exchange Ratio, rounded up to the nearest
whole cent; provided, however, that the foregoing conversions would be adjusted
with respect to Options that qualify as incentive stock options under Section
422 of the Code to the extent necessary to preserve their treatment as such. As
soon as reasonably practicable after the Effective Time, Household will issue
to each holder of an outstanding RHI Stock Option assumed by Household a notice
describing the foregoing assumption of such RHI Stock Option by Household.

Section 3.7 Tax Treatment. Unless the Merger is a Cash Merger, it is
intended by the parties hereto that the Merger shall constitute a
reorganization within the meaning of Section 368 of the Code. The parties
hereto adopt this Agreement as a "plan of reorganization" within the meaning of
Sections 1.368-2(g) and 1.368-3(a) of the United States Income Tax Regulations.

Section 3.8 Dissenters' Rights. RHI Common Stock which is not voted in favor
of the Merger and with respect to which a Notice of Intent to Demand Payment
shall have been properly made in accordance with Section 60.564 of the OCL
("Dissenting Shares") shall not be converted into the right to receive any
Merger Consideration and the holders of Dissenting Shares shall be entitled
only to such rights as are contemplated by the OCL; provided, however, that if
a holder of Dissenting Shares shall withdraw his, her or its demand for such
payment or shall become ineligible for such payment, pursuant to the OCL, then
as of the Effective Time or the occurrence of such event of withdrawal or
ineligibility, whichever later occurs, such holder's Dissenting Shares shall
cease to be Dissenting Shares and shall be converted into the right to receive
the Cash Consideration. Any payment required pursuant to this Section 3.8 shall
be paid in cash, at Household's option, by Household or the Surviving
Corporation or in part by each.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF RHI

Except as disclosed or otherwise referred to in the Disclosure Letter or in
the documents identified therein, RHI hereby represents and warrants to
Household and Merger Sub that:

Section 4.1 Organization and Qualifications; Subsidiaries. RHI and each
subsidiary of RHI is a corporation, partnership, federal savings bank or other
legal entity duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization and has the
corporate or other applicable power and authority and all necessary
governmental approvals to own, lease and operate its properties and to carry on
its business as it is now being conducted, except where failure to obtain such
approvals would not cause a Material Adverse Effect on RHI. Each of RHI and its
subsidiaries is duly qualified or licensed as a foreign corporation or
partnership to transact business, and is in good standing, in each jurisdiction
where the character of the properties owned, leased or operated by it or the
nature of its business makes such qualification or licensing necessary and
where the failure to so qualify would cause a Material Adverse Effect on RHI.
Each subsidiary of RHI or other Person in which RHI has an equity interest is
listed on Schedule 4.1 to the Disclosure Letter.

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Section 4.2 Articles of Incorporation or Charter and Bylaws. Complete and
correct copies of the articles of incorporation or charter and bylaws of RHI
and each of its subsidiaries, as amended to date, are included with Schedule
4.2 to the Disclosure Letter. Such Organizational Documents are in full force
and effect and reflect all amendments or modifications adopted as of the date
hereof. RHI is not in violation of any provision of its Organizational
Documents. No subsidiary of RHI is in violation of any provision of its
Organizational Documents.

Section 4.3 Capitalization. The authorized capital stock of RHI consists of
500,000 shares of Class C common stock, par value $.01 per share, 24,500,000
shares of Class B common stock, par value $.01 per share, and 25,000,000 shares
of common stock, par value $.01 per share. As of November 12, 1999, (a) 299,078
shares of Class C Common Stock, par value $.01 per share, 317,314 shares of
Class B Common Stock, par value $.01 per share, and 5,859,419 shares of common
stock, par value $.01 per share were issued and outstanding, all of which were
validly issued, fully paid and nonassessable; and (b)(i) 2,573,177 shares of
common stock, par value $.01 per share, were reserved for issuance upon the
exercise of outstanding stock options granted pursuant to the RHI Option Plans
and (ii) 867,341 shares of Class B common stock, par value $.01 per share, were
reserved for issuance upon exercise of the GECC Warrant. Except as set forth in
Schedule 4.3 to the Disclosure Letter, since November 12, 1999, no shares of
capital stock or other voting securities of RHI or any of its subsidiaries, or
Options in respect thereof have been issued except upon the exercise of RHI
Stock Options. Except for the RHI Stock Options and the GECC Warrant, there are
not now, and at the Closing there will not be, any Options of RHI in existence.
All shares of RHI Common Stock subject to issuance as aforesaid, upon issuance
on the terms and conditions specified in the instruments pursuant to which they
are issuable, will be duly authorized, validly issued, fully paid and
nonassessable. Other than as listed on Schedule 4.3 to the Disclosure Letter,
there are no outstanding contractual obligations of RHI or any of its
subsidiaries to repurchase, redeem or otherwise acquire any shares of RHI
Common Stock or any other shares of capital stock of RHI or any of its
subsidiaries, or make any material investment (in the form of a loan, capital
contribution or otherwise) in any subsidiary of RHI or any other Person, other
than a wholly-owned subsidiary of RHI or a Person wholly-owned by one or more
wholly-owned subsidiaries of RHI. Other than as listed on Schedule 4.3 to the
Disclosure Letter, each outstanding share of capital stock of each subsidiary
of RHI is duly authorized, validly issued, fully paid and nonassessable and RHI
or a subsidiary of RHI owns all the shares of such capital stock free and clear
of any Liens. Schedule 4.3 to the Disclosure Letter sets forth a complete
listing as of November 12, 1999 of holders of shares of RHI Common Stock and
holders of Options to acquire RHI Common Stock and the number of shares and
Options held by each.

Section 4.4 Authority Relative to This Agreement. RHI has all necessary
corporate power and authority to execute and deliver this Agreement, and,
subject to the RHI Stockholder Approval, to perform its obligations hereunder
and to consummate the Transactions. The execution and delivery of this
Agreement by RHI, the performance by RHI of its obligations hereunder and the
consummation by RHI of the Transactions have been duly and validly approved by
the Board of Directors of RHI, the Board of Directors of RHI has recommended
approval of this Agreement by the stockholders of RHI and directed that this
Agreement be submitted to the stockholders of RHI for their consideration, and
no other corporate proceedings on the part of RHI are necessary to authorize
this Agreement or to consummate the Transactions (other than the RHI
Stockholder Approval and the Merger Filing). This Agreement has been duly and
validly executed and delivered by RHI and, assuming the due authorization,
execution and delivery thereof by Household and Merger Sub, constitutes the
legal, valid and binding obligation of RHI, enforceable against RHI in
accordance with its terms, except as enforceability may be limited by
bankruptcy and other similar laws and general principles of equity.

Section 4.5 No Conflict; Required Filings and Consents; Certain Contracts.
(a) Except as set forth on Schedule 4.5(a) to the Disclosure Letter, the
execution and delivery of this Agreement by RHI does not, and the performance
of its obligations under this Agreement and the consummation of the
Transactions by RHI will not, (i) conflict with, result in a breach of, cause a
dissolution or require the consent or approval of any Person under, or violate
any provision of, the Organizational Documents of RHI or any of its
subsidiaries, (ii) require any consent, approval, authorization or permit of,
or filing with or notification to, any Governmental Authority,

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except for (A) applicable requirements of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 (as amended, the "HSR Act"), including any rules and
regulations promulgated thereunder, (B) the Merger Filing, (C) the RHI
Stockholder Approval, (D) the filing of applications and notices, as
applicable, with the United States Office of Thrift Supervision (the "OTS")
under the Home Owners' Loan Act ("HOLA") or with the OTS under 12 U.S.C. (S)
1467(a)(S) (the "Bank Merger Act") or the United States Office of the
Comptroller (the "OCC") under 12 U.S.C. (S) 1817(j) (the "Change in Bank
Control Act"), as applicable, and the approval of such applications by the OTS
or OCC, as applicable, (E) the filing of applications and notices, as
applicable, with the state regulatory authorities governing consumer finance,
mortgage lending and insurance in the states in which RHI operates its business
or the filing of applications and notices with federal housing related
authorities, and the approval of such applications by such authorities, and (F)
such other consents, authorizations, filings, approvals and registrations which
if not obtained or made would not result in a Material Adverse Effect on RHI or
Household, (iii) subject to the making of the filings and obtaining the
approvals identified in clause (ii), conflict with or violate any Law,
judgment, order, writ, injunction or decree applicable to RHI or any of its
subsidiaries or by which any property or asset of RHI or any subsidiary is
bound or affected, which conflict or violation would result in a Material
Adverse Effect on RHI or the Surviving Corporation, or (iv) conflict with or
result in any breach of or constitute a default (or an event which with notice
or lapse of time or both would become a default) under, result in the loss by
RHI or any of its subsidiaries or modification in a manner materially adverse
to RHI or any of its subsidiaries of any right or benefit under, or give to
others any right of termination, amendment, acceleration, repurchase or
repayment, increased payments or cancellation of, or result in the creation of
a Lien or other encumbrance on any RHI Common Stock or any material property or
asset of RHI or any subsidiary of RHI pursuant to, any Contract of RHI, except,
in each case, such as would not, individually or in the aggregate have a
Material Adverse Effect on RHI. The notices, consents or approvals, filings or
registrations, and expirations or terminations of waiting periods referred to
in clauses (A) and (D)-(F) above are hereinafter referred to as the "Requisite
Regulatory Approvals."

(b) Except as set forth in Schedule 4.5(b) to the Disclosure Letter, to the
Knowledge of RHI, there are no Contracts to which RHI or any subsidiary of RHI
is a party or by which RHI or any subsidiary of RHI or any asset of RHI or any
subsidiary of RHI is bound, which by its terms materially limits the ability of
RHI or any subsidiary of RHI, or after consummation of the Transactions, would
by its terms materially limit the ability of Household or any of its
Affiliates, to engage in any business in any area or for any period.

Section 4.6 Compliance. Except as set forth on Schedule 4.6 to the
Disclosure Letter, neither RHI nor any subsidiary of RHI is in conflict with,
or in default or violation of, (a) any Law applicable to such Person or by
which any property or asset of such Person is bound or affected, or (b) any
Contract to which RHI or any subsidiary of RHI is a party or by which such
Person or any property or asset of such Person is bound or affected, except for
such conflicts, defaults, or violations that would not, individually or in the
aggregate, have a Material Adverse Effect on RHI.

Section 4.7 Reports and Financial Statements. Each form, report, schedule,
financial statement or other document filed since January 1, 1998 with a
regulatory agency by RHI or any of its subsidiaries prior to the date hereof
(as such documents have been amended prior to the date hereof, the "RHI
Reports"), as of their respective dates, complied in all material respects with
the legal requirements and the rules and regulations applicable thereto. None
of the RHI Reports, as of their respective dates, contained any 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, in light of the
circumstances under which they were made, not misleading, except for such
statements, if any, as have been modified or superseded by subsequent filings
prior to the date hereof. Schedule 4.7(a) to the Disclosure Letter contains a
true, accurate and complete list of all of the material RHI Reports. The
consolidated financial statements of RHI and its subsidiaries for December 31,
1998 and the quarterly and nine-month period ended September 30, 1999, included
as Schedule 4.7(b) to the Disclosure Letter hereto, were prepared in accordance
with GAAP during the periods involved consistently applied (except as may be
indicated in the notes thereto) and fairly present in all material respects
except for necessary normal recurring

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year end adjustments the consolidated financial position of RHI and its
consolidated subsidiaries as at the dates thereof and the consolidated results
of their operations and cash flows for the respective periods then ended and do
not contain any material misstatements of the financial condition or result of
operations of RHI at such dates or for the periods then ended. Since September
30, 1999, neither RHI nor any of its subsidiaries has incurred any liabilities
or obligations (whether absolute, accrued, fixed, contingent, liquidated,
unliquidated or otherwise and whether due or to become due) of any nature,
except as set forth in Schedule 4.7(c) to the Disclosure Letter and except
liabilities, obligations or contingencies (a) which are reflected on the
consolidated balance sheet of RHI and its subsidiaries as at September 30, 1999
(including the notes thereto), (b) which were incurred after September 30, 1999
in the ordinary course of business consistent with past practices or (c) which
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect on RHI. RHI and its subsidiaries have timely filed all
forms, reports and other documents material to the business of RHI and its
subsidiaries required to be filed prior to the date hereof with any
governmental agency. Since December 31, 1998, there has been no change in any
of the significant accounting (including tax accounting) policies, practices or
procedures of RHI or any subsidiary of RHI, except changes to comply with
changes in accounting pronouncements of the Financial Accounting Standards
Board or changes in applicable laws or rules or regulations thereunder as
disclosed on Schedule 4.7(d) to the Disclosure Letter.

Section 4.8 Absence of Certain Changes or Events. Except as contemplated by
this Agreement or as set forth on Schedule 4.8 to the Disclosure Letter, since
September 30, 1999, RHI and its subsidiaries have conducted their respective
businesses only in the ordinary course consistent with past practices, and have
not taken any of the actions set forth in paragraphs (a) through (j) of Section
6.4 (except that for purposes of this Section 4.8, the $250,000 limit set forth
in Section 6.4(j)(ii) shall be $1,000,000 as to all events occurring before the
date of this Agreement), except for such events as have not had or, insofar as
reasonably can be foreseen, are not likely in the future to have, a Material
Adverse Effect on RHI.

Section 4.9 Litigation. Schedule 4.9 to the Disclosure Letter lists, as of
the date hereof and the Closing Date, all material claims, suits, actions or
proceedings pending or, to the Knowledge of RHI, threatened or contemplated,
including any investigations or reviews by any Governmental Authority pending
or, to the Knowledge of RHI, threatened or contemplated, against, relating to
or affecting RHI (collectively, the "Claims"). If adversely determined, the
Claims will not, individually or in the aggregate, have a Material Adverse
Effect on RHI. There is no judgment, decree, order, injunction or writ of any
Governmental Authority outstanding against RHI or any of its subsidiaries.

Section 4.10 Employee Benefit Plans. With respect, as applicable, to Benefit
Plans and Benefit Arrangements to the Knowledge of RHI and except as would not
reasonably be expected to have a Material Adverse Effect on RHI:

(a) neither RHI nor any ERISA Affiliate has maintained or contributed to
any Qualified Plans since January 1, 1993 other than the RHI 401(k) Plan
("RHI 401(k) Plan"); Schedule 4.10(a) to the Disclosure Letter completely
and accurately lists all RHI Plans and RHI Benefit Arrangements and
specifically identifies any that are Qualified Plans;

(b) the RHI 401(k) Plan has always qualified in form and operation under
Code Section 401(a) and has a currently applicable determination letter
from the IRS, and its trust has always been exempt under Code Section
501(a), and nothing has occurred with respect to such plan and trust that
could cause the loss of such qualification or exemption or the imposition
of any liability, lien, penalty, or tax under ERISA or the Code;

(c) each RHI Plan and each RHI Benefit Arrangement has been maintained
in all material respects in accordance with its constituent documents and
with all applicable provisions of the Code, ERISA and other domestic and
foreign laws, including federal, state, and foreign securities laws and all
laws respecting reporting disclosure;

(d) no RHI Plan holds employer securities;

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(e) no RHI Company or other ERISA Affiliate has sponsored, maintained,
or had any liability (direct or indirect, actual or contingent) with
respect to any Benefit Plan subject to Title IV of ERISA. No RHI Company
and no ERISA Affiliate has ever made or been obligated to make, or
reimbursed or been obligated to reimburse another employer for,
contributions to any multiemployer plan (as defined in ERISA Section
3(37));

(f) there are no pending claims or lawsuits by, against, or relating to
any non-RHI Benefit Plans or non-RHI Benefit Arrangements that would be
reasonably likely to result in liability for the RHI Companies, and no
claims or lawsuits (other than routine benefit claims) have been asserted,
instituted or, to the knowledge of the RHI Companies, threatened by,
against, or relating to any non-RHI Benefit Plans or non-RHI Benefit
Arrangements that would be reasonably likely to result in liability for the
RHI Companies, and no claims or lawsuits (other than routine benefit
claims) have been asserted, instituted or to the knowledge of the RHI
Companies, threatened by, against, or relating to any RHI Plan or RHI
Benefit Arrangement, and the RHI Companies do not have knowledge of any
fact that could form the basis for any such claim or lawsuit;

(g) the RHI Plans and RHI Benefit Arrangements are not presently under
audit or examination (and have not received notice of a potential audit or
examination) by any Governmental Authority, and no matters are pending with
respect to the RHI 401(k) Plan under any governmental compliance programs;

(h) except as specified in this Agreement or on Schedule 4.10(h) to the
Disclosure Letter, no RHI Plan or RHI Benefit Arrangement contains any
provision or is subject to any law that would give rise to any vesting of
benefits (other than if the RHI 401(k) Plan is terminated), severance,
termination, or other payments or liabilities as a result of the
Transactions, and the RHI Companies have not declared or paid any bonus or
other incentive compensation or established any severance plan, program, or
arrangement in contemplation of the Transactions;

(i) with respect to each RHI Plan, there have been no violations of Code
Section 4975 or ERISA Sections 404 or 406 as to which successful claims
would result in any liability for the RHI Companies or the Merger Sub or
any Person required to be indemnified by them;

(j) the RHI Companies have made all required contributions to the RHI
Plans as of the last day of the each plan's most recent fiscal year; all
benefits accrued under any unfunded RHI Plan or RHI Benefit Arrangement
will have been paid, accrued, or otherwise adequately reserved in
accordance with GAAP, consistently applied; and all monies withheld from
employee paychecks with respect to RHI Plans have been transferred to the
appropriate plan within the timing required by governmental regulations;

(k) RHI and its ERISA Affiliates have complied in all material respects
with the health continuation rules of Code Sections 4980B (and its
predecessor), Code Section 5000, and the Health Insurance Portability and
Accountability Act;

(l) the RHI Companies have no liability (whether actual, contingent, or
otherwise) with respect to any Benefit Plan or Benefit Arrangement that is
not a RHI Benefit Arrangement or with respect to any Benefit Plan sponsored
or maintained (or which has been or should have been sponsored or
maintained) by any ERISA Affiliate that is not an RHI Company; and no facts
exist that could reasonably be expected to result in such liability, as a
result of a termination, withdrawal or funding waiver with respect to any
such plan, program, or arrangement;

(m) no employee or former employee of the RHI Companies nor beneficiary
of any such employee or former employee is, by reason of such employee's or
former employee's employment, entitled to receive any benefits subject to
reporting under Statement of Financial Accounting Standards No. 106, other
than as required by Code Section 4980B or other applicable law;

(n) no employee or former employee (or beneficiary of either) of any RHI
Company is entitled to receive any benefits, including, without limitation,
death or medical benefits (whether or not insured) beyond retirement or
other termination of employment, other than as applicable law requires; and

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(o) there are no contracts, agreements, plans or arrangements, including
but not limited to the provisions of this Agreement, covering any employee
or former employee of the RHI Companies that, individually or collectively,
could give rise to the payment of any amount (or portion thereof) that
would not be deductible pursuant to Code Sections 280G, 404 or 162.

Section 4.11 Labor. With respect to employees of and service providers to
the RHI Companies, to the Knowledge of RHI and except as would not reasonably
be expected to have a Material Adverse Effect on RHI:

(a) the RHI Companies are complying and have complied in all material
respects with all applicable laws respecting employment and employment
practices, terms and conditions of employment and wages and hours,
including without limitation any such laws respecting employment
discrimination, workers' compensation, family and medical leave, the
Immigration Reform and Control Act, and occupational safety and health
requirements, and no claims or investigations are pending or threatened
with respect to such laws, either by private individuals or by governmental
agencies;

(b) the employees of the RHI Companies are not and have never been
represented by any labor union, and no collective bargaining agreement is
binding and in force against, or currently being negotiated by, any of the
RHI Companies, and no labor representation organization effort exists nor
has there been any such activity within the past three years;

(c) no grievance or arbitration proceeding arising out of employment
relationships is pending, and no claims therefor exist or have been
threatened; no labor strike, lock out, slowdown, or work stoppage is or has
ever been pending or threatened against or directly affecting any RHI
Company; and no RHI Company is or has been engaged in any unfair labor
practice, and there is not now, nor within the past three years has there
been, any unfair labor practice complaint against any RHI Company pending
or threatened, before the National Labor Relations Board or any other
comparable foreign or domestic authority or any workers' council;

(d) all Persons classified by the RHI Companies as independent
contractors do satisfy and have satisfied the requirements of law to be so
classified, and the RHI Companies have fully and accurately reported their
compensation on IRS Forms 1099 when required to do so and properly treated
them for purposes of the RHI Plans and RHI Benefit Arrangements;

(e) since December 31, 1998, no employee of the RHI Companies, or group
of employees, the loss of whom would have a Material Adverse Effect on the
business of any of the RHI Companies, has notified any of the RHI Companies
of his or their intent to (A) terminate his or their relationship with the
RHI Companies or (B) make any demand for material payments or modifications
of his or their arrangements with the RHI Companies;

(f) each of the RHI Companies has complied with all garnishment orders
it has received and has made available to Household all garnishment orders
it has received in the last year; and

(g) there is no charge or compliance proceeding actually pending or
threatened against any RHI Company before the Equal Employment Opportunity
Commission or any state, local, or foreign agency responsible for the
prevention of unlawful employment practices.

Section 4.12 Insurance. Schedule 4.12 to the Disclosure Letter sets forth
(a) an accurate summary description of each material insurance policy providing
coverage for liability exposure (including policies providing property,
casualty, liability and workers' compensation coverage and bond and surety
arrangements) to which RHI or any of its subsidiaries is currently, or has been
during the past two years, a party, a named insured or otherwise the
beneficiary of coverage and (b) all insurance loss runs or workers'
compensation claims received for the past two policy years. With respect to
each such insurance policy: to the Knowledge of RHI, (a) the policy is legal,
valid, binding, enforceable and in full force and effect; (b) there will be no
breach or other violation of the policy resulting from the Transactions; and
(c) RHI is not in breach or default (including with respect to the payment of
premiums or the giving of notices), and no event has occurred which, with
notice or the lapse of time, would constitute such a breach or default, or
permit termination, modification or acceleration, under the policy.

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Section 4.13 Brokers. Other than William Blair & Company LLC (the "RHI
Financial Advisor"), no broker, finder or investment banker is entitled to any
brokerage, finder's or other fee or commission in connection with the
Transactions based on any arrangement or agreement made by or on behalf of RHI.

Section 4.14 Taxes. (a) Each of RHI and its subsidiaries has timely filed
(or has had timely filed on its behalf) or will file or cause to be timely
filed, all Tax Returns (or requests for extensions of time to file) required by
applicable law to be filed by it prior to or as of the Effective Time and all
such Tax Returns and amendments thereto (and extensions) are, or will be before
the Effective Time, true, complete and correct, except to the extent that
failures to file, to have extensions granted that remain in effect or to file
returns and amendments that are true, complete and correct would not reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect on RHI.

(b) Except as would not reasonably be expected to have a Material Adverse
Effect on RHI, each of RHI and its subsidiaries has paid (or has had paid on
its behalf), or has established (or has had established on its behalf and for
its sole benefit and recourse), or will establish or cause to be established on
or before the Effective Time, an adequate accrual for the payment of, all Taxes
due with respect to any period ending prior to or as of the Effective Time.

(c) Except as would not reasonably be expected to have a Material Adverse
Effect on RHI, no deficiency or adjustment for any Taxes has been proposed,
asserted or assessed against RHI or any of its subsidiaries that has not been
resolved or paid or for which an adequate accrual has not been established in
accordance with GAAP consistently applied and there are no Liens for Taxes upon
the assets of RHI or any of its subsidiaries, except Liens for current Taxes
not yet due.

(d) Except as would not reasonably be expected to have a Material Adverse
Effect on RHI, neither RHI nor any of its subsidiaries has entered into any
Contract that would result in the disallowance of any tax deductions pursuant
to Section 280G of the Code. No "consent" within the meaning of Section 341(f)
of the Code has been filed with respect to RHI or any of its subsidiaries. None
of RHI or its subsidiaries has been a United States real property holding
corporation within the meaning of Code Section 897(c)(2) during the applicable
period specified in Code Section 897(c)(1)(A)(ii).

(e) All Tax sharing agreements (other than agreements between or among RHI
and its subsidiaries), Tax indemnity agreements and similar agreements to which
RHI or any of its subsidiaries is a party are disclosed on Schedule 4.14 to the
Disclosure Letter. None of RHI and its subsidiaries has been a member of an
affiliated group filing a consolidated Federal income tax return (other than a
group of which the common parent was RHI). None of RHI or its subsidiaries has
any liability to a Governmental Authority for the Taxes of any Person (other
than RHI and its subsidiaries under Treasury Regulation Section 1.1502-6 (or
any similar provision of state, local, or foreign law)), as a transferee or
successor, by contract, or otherwise.

(f) No federal, state, local or foreign audits or other administrative or
court proceedings are pending or, to the Knowledge of RHI threatened with
regard to any Tax Returns or Taxes of RHI or any of its subsidiaries which, if
determined adversely, would have a Material Adverse Effect on RHI.

Section 4.15 Environmental Matters. RHI and its subsidiaries are in
compliance in all material respects with all environmental laws, rules,
regulations and standards promulgated, adopted or enforced by the Environmental
Protection Agency ("EPA") and of similar agencies in states in which they
conduct their respective businesses. There is no suit, claim, action or
proceeding now pending before any court, governmental agency or board or other
forum or, to the Knowledge of RHI, threatened by any Person, (a) for alleged
noncompliance with any environmental law, rule or regulation or (b) relating to
the discharge or release into the environment of any hazardous material or
waste at or on a site presently or formerly owned, leased or operated by RHI or
any of its subsidiaries.

Section 4.16 Loans. All currently outstanding secured or unsecured loans,
advances, credit lines or credit card receivables owned and originated by RHI
(individually, a "Loan," and collectively, the "Loans") were originated by RHI
in compliance in all material respects with all applicable requirements of
United States

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federal and state law. Each loan, credit agreement or security instrument
related to the Loans constitutes a valid, legal and binding obligation of the
obligor thereunder, enforceable against such obligor in accordance with the
terms thereof (except as enforcement may be limited by general principles of
equity whether applied in a court of law or a court of equity and by
bankruptcy, insolvency and similar laws affecting creditors' rights and
remedies generally), except where the failure thereof, individually or in the
aggregate, would not have a Material Adverse Effect on RHI. There are no oral
modifications or amendments related to the Loans that are not reflected in
RHI's records, no defenses as to the enforcement of any Loan have been
asserted, and there have been no acts or omissions which would give rise to any
claim or right of rescission, set-off, counterclaim or defense, except where
any of the foregoing, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on RHI. Except as disclosed on
Schedule 4.16 to the Disclosure Letter, none of the Loans is presently directly
serviced by third parties and there is no obligation which could result in any
Loan becoming subject to any direct third party servicing. For purposes of the
preceding sentence, a Loan shall be deemed directly serviced by a third party
if the third party has the primary responsibility for the servicing of the Loan
and is not merely an independent contractor under contract to perform a portion
of the servicing of the Loan for RHI or any of its Material Subsidiaries. The
reserves established against the Loans have been established based on RHI's
prior loss experience in accordance with GAAP, consistently applied, and
reflect RHI's management's good faith judgment as to the appropriate reserves
with respect to such Loans.

Section 4.17 Intellectual Property. (a) RHI owns or has the right to use
pursuant to license, sublicense, agreement, permission or otherwise all
patents, copyrights, software, trademarks, service marks, trade dress, logos,
trade names and corporate names and all applications, registrations and
renewals in connection therewith and all other proprietary rights
("Intellectual Property"), in each case to the extent necessary for and
material to the operation of its business as presently conducted. Each such
item of Intellectual Property owned or used by RHI immediately prior to the
Closing hereunder will continue to be owned or available for use by the
Surviving Corporation on identical terms and conditions immediately subsequent
to the Closing hereunder, except where failure of such ownership or
availability for use will not have a Material Adverse Effect on RHI.

(b) Except as set forth on Schedule 4.17 to the Disclosure Letter or as
would not reasonably be expected to have a Material Adverse Effect on RHI, to
the Knowledge of RHI, RHI has not interfered with, infringed upon or
misappropriated any Intellectual Property rights of third parties, and has not
received any complaint, claim, demand or notice alleging any such interference,
infringement or misappropriation (including any claim that RHI must license or
refrain from using any Intellectual Property rights of any third party) within
the last three years. To the Knowledge of RHI, no third party has interfered
with, infringed upon, or misappropriated or otherwise come into conflict with
any Intellectual Property rights of RHI.

Section 4.18 Books and Records. The books and records, minutes books, stock
record books and other records of RHI and all of its subsidiaries, all of which
have been made available to Household, are complete and correct in all material
respects and have been maintained in accordance with sound business practices,
except for minutes of meetings of the Board of Directors that have not been
completed or approved by the Board of Directors as of the date of this
Agreement (provided that summaries of any such minutes have been made available
to Household). The respective minutes books of RHI and each of its subsidiaries
contain accurate and complete records of all meetings held of, and corporate
action taken by, the stockholders and the Boards of Directors of RHI and each
of its subsidiaries.

Section 4.19 Transactions with Affiliates. Except as set forth on Schedule
4.19 to the Disclosure Letter, since December 31, 1998, neither RHI nor any of
its subsidiaries has entered into any transaction with any current director,
officer or 5% or larger shareholder of RHI or any Affiliate of such director,
officer or shareholder, and all ongoing contracts with any director or officer
are on arms' length terms no less favorable to RHI than would have been
obtained from any unaffiliated third party.

Section 4.20 Opinion of Financial Advisor. The RHI Financial Advisor has
delivered to RHI an opinion dated the date of this Agreement to the effect that
the Merger Consideration to be received by the holders of

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the issued and outstanding shares of the RHI Common Stock is fair from a
financial point of view to the holders of the RHI Common Stock.

Section 4.21 Reliance. In entering into this Agreement, RHI has relied
solely on representations made in this Agreement, including the Disclosure
Letter hereto, and any certificates and documents required to be provided by
Household and Merger Sub pursuant to this Agreement. RHI has been represented
by counsel and has had sufficient opportunity to examine and understand the
business and assets of Household.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF HOUSEHOLD AND MERGER SUB

Except as disclosed or otherwise referred to in any applicable Schedule
attached hereto or in the documents identified in any such Schedule, Household
and Merger Sub hereby represent and warrant to RHI that:

Section 5.1 Organization and Qualifications; Subsidiaries. Household, Merger
Sub and each Material Subsidiary of Household is a corporation, partnership or
other legal entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization and has the
corporate power and authority and all necessary governmental approvals to own,
lease and operate its properties and to carry on its business as it is now
being conducted, except where failure to obtain such approvals would not have a
Material Adverse Effect upon Household. Each of Household, Merger Sub and each
Material Subsidiary of Household is duly qualified or licensed as a foreign
corporation, partnership or limited liability company to transact business, and
is in good standing, in each jurisdiction where the character of the properties
owned, leased or operated by it or the nature of its business makes such
qualification or licensing necessary and where the failure to so qualify would
cause a Material Adverse Effect upon such entity.

Section 5.2 Charter and Bylaws. Complete and correct copies of the charter
and bylaws of Household and Merger Sub, as amended to date, have been filed (or
incorporated by reference) as Exhibits 3.1 and 3.2, respectively, to
Household's Annual Report on Form 10-K for the year ended December 31, 1998 or
have been provided to RHI. Such Organizational Documents are in full force and
effect and have not been amended or modified in any respect. Household is not
in violation of any provision of its Organizational Documents. No subsidiary of
Household is in violation of any provision of its Organizational Documents.

Section 5.3 Capitalization. The authorized capital stock of Household
consists of 750,000,000 shares of Household Common Stock and 8,155,004 shares
of preferred stock of Household, no par value. As of September 30, 1999, (i)
470,701,152 shares of Household Common Stock were issued and outstanding, all
of which were validly issued, fully paid and nonassessable; and (ii)(A)
31,420,552 shares of Household Common Stock were reserved for issuance under
Household employee or director benefit programs or Household's dividend
reinvestment plan (collectively, the "Household Stock Plans"), (B) 79,654,916
shares of Household Common Stock were classified as treasury shares. Except as
set forth above, since September 30, 1999, no shares of Household Common Stock
or other voting securities of Household (other than rights attached to
Household's Common Stock for Household's Junior Participating Preferred Stock)
were issued, reserved for issuance or outstanding. All shares of Household
Common Stock subject to issuance as aforesaid and all shares of Household
Common Stock subject to issuance as Merger Consideration, upon issuance on the
terms and conditions specified in the instruments pursuant to which they are
issuable, will be duly authorized, validly issued, fully paid and
nonassessable. Except in connection with Household's publicly announced stock
repurchase program, there are no outstanding contractual obligations of
Household to repurchase, redeem or otherwise acquire any shares of Household
Common Stock or any other shares of capital stock of Household, or make any
material investment (in the form of a loan, capital contribution or otherwise)
in any subsidiary of Household or any other Person, other than a wholly-owned
subsidiary of Household or a Person wholly-owned by one or more wholly-owned
subsidiaries of Household. Each outstanding share of capital stock of each
subsidiary of Household is duly authorized, validly issued, fully paid and
nonassessable and each such share owned by Household or any subsidiary of
Household is owned free and clear of any Liens.

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Section 5.4 Authority Relative to This Agreement. Household and Merger Sub
have all necessary corporate power and authority to execute and deliver this
Agreement, and to perform its obligations hereunder and to consummate the
Transactions. The execution and delivery of this Agreement by Household and
Merger Sub, the performance by Household and Merger Sub of its obligations
hereunder and the consummation by Household and Merger Sub of the Transactions
have been duly and validly approved by the Board of Directors of Household and
Merger Sub, and no other corporate proceedings on the part of Household and
Merger Sub are necessary to authorize this Agreement or to consummate the
Transactions (other than the Merger Filing). This Agreement has been duly and
validly executed and delivered by Household and Merger Sub and, assuming the
due authorization, execution and delivery thereof by RHI, constitutes the
legal, valid and binding obligation of Household and Merger Sub, enforceable
against Household and Merger Sub in accordance with its terms, except as
enforceability may be limited by bankruptcy and other similar laws and general
principles of equity.

Section 5.5 No Conflict; Required Filings and Consents. The execution and
delivery of this Agreement by Household and Merger Sub do not, and the
performance of their respective obligations under this Agreement and the
consummation of the Transactions by Household and Merger Sub will not, (a)
conflict with, result in a breach of, cause a dissolution or require the
consent or approval of any Person under, or violate any provision of, the
Organizational Documents of Household or Merger Sub, (b) require any consent,
approval, authorization or permit of, or filing with or notification to, any
Governmental Authority, except for (i) applicable requirements, if any, of the
Exchange Act, the Securities Act, the Blue Sky Laws and the HSR Act, in each
case, including any rules and regulations promulgated thereunder, (ii) the
Merger Filing, (iii) the RHI Stockholder Approval, (iv) the filing of
applications and notices, as applicable, with the OTS under HOLA or the Bank
Merger Act and the approval of such applications by the OTS; and (v) such other
consents, authorizations, filings, approvals and registrations which if not
obtained or made would not be material to RHI or Household or have a material
adverse effect on the ability of the parties to consummate the Merger, (c)
subject to the making of the filings and obtaining the approvals identified in
clause (b), conflict with or violate any Law, judgment, order, writ, injunction
or decree applicable to Household or Merger Sub or by which any property or
asset of Household or Merger Sub is bound or affected, which conflict or
violation would result in a loss of material benefits to or in any material
liability to RHI, Household or the Surviving Corporation, or (d) conflict with
or result in any breach of or constitute a default (or an event which with
notice or lapse of time or both would become a default) under, result in the
loss by Household or Merger Sub or modification in a manner materially adverse
to Household or Merger Sub of any right or benefit under, or give to others any
right of termination, amendment, acceleration, repurchase or repayment,
increased payments or cancellation of, or result in the creation of a Lien or
other encumbrance on any Household Common Stock issued pursuant to the Merger
or any material property or asset of Household or Merger Sub or any subsidiary
of Household or Merger Sub pursuant to, any Contract of Household or Merger
Sub, except, in each case, such as would not, individually or in the aggregate
have a material adverse effect on the ability of the parties to consummate of
the Merger, or have a Material Adverse Effect on Household.

Section 5.6 Compliance. Neither Household, Merger Sub nor any Material
Subsidiary of Household is in conflict with, or in default or violation of, (a)
any Law applicable to such Person or by which any property or asset of such
Person is bound or affected, or (b) any Contract to which Household or Merger
Sub or any Material Subsidiary of Household is a party or by which such Person
or any property or asset of such Person is bound or affected, except for any
such conflicts, defaults or violations that would not, individually or in the
aggregate, have a Material Adverse Effect on Household.

Section 5.7 SEC Reports and Financial Statements. Each form, report,
schedule, registration statement and definitive proxy statement filed by
Household with the SEC prior to the date hereof (as such documents have been
amended prior to the date hereof, the "Household SEC Reports"), as of their
respective dates, complied in all material respects with the applicable
requirements of the Securities Act and the Exchange Act and the rules and
regulations thereunder. None of the Household SEC Reports, as of their
respective dates, contained or contains any untrue statement of a material fact
or omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they
were

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made, not misleading, except for such statements, if any, as have been modified
or superseded by subsequent filings prior to the date hereof. The consolidated
financial statements of Household and its subsidiaries included in such reports
comply as to form in all material respects with applicable accounting
requirements and with the published rules and regulations of the SEC with
respect thereto, have been prepared in accordance with GAAP, consistently
applied (except as may be indicated in the notes thereto or, in the case of the
unaudited interim financial statements, as permitted by Form 10-Q of the SEC)
and fairly present in all material respects (subject, in the case of the
unaudited interim financial statements, to normal, year-end audit adjustments)
the consolidated financial position of Household and its subsidiaries as at the
dates thereof and the consolidated results of their operations and cash flows
for the periods then ended. Since September 30, 1999, neither Household nor any
of its subsidiaries has incurred any liabilities or obligations (whether
absolute, accrued, fixed, contingent, liquidated, unliquidated or otherwise and
whether due or to become due) of any nature, except liabilities, obligations or
contingencies (a) which are reflected on the consolidated balance sheet of
Household and its subsidiaries as at September 30, 1999 (including the notes
thereto) or (b) which (i) were incurred in the ordinary course of business
after September 30, 1999 and consistent with past practices, or (ii) are
disclosed in the Household SEC Reports. Since January 1, 1998, Household has
timely filed with the SEC all forms, reports and other documents required to be
filed prior to the date hereof, and no subsidiary of Household has filed, or
been required to file, any form, report or other document with the SEC, in each
case, pursuant to the Securities Act, the Exchange Act or the rules and
regulations thereunder. Since December 31, 1998, except as described in the
Household SEC Reports, there has been no change in any of the significant
accounting (including tax accounting) policies, practices or procedures of
Household or any subsidiary of Household, except changes resulting from changes
in accounting pronouncements of Financial Accounting Standards Boards or
changes in applicable laws or rules or regulations thereunder.

Section 5.8 Absence of Certain Changes or Events. Except as contemplated by
this Agreement or as disclosed in any Household SEC Report, since December 31,
1998, (a) Household and its subsidiaries have conducted their respective
businesses only in the ordinary course, consistent with past practice, and (b)
as of the date hereof, there has not occurred or arisen any event that,
individually or in the aggregate, has had or, insofar as reasonably can be
foreseen, is likely in the future to have, a Material Adverse Effect on
Household.

Section 5.9 Litigation. Except as disclosed in the Household SEC Reports,
there are no claims, suits, actions or proceedings pending or, to Household's
knowledge, threatened or contemplated, nor are there any investigations or
reviews by any Governmental Authority pending or, to Household's knowledge,
threatened or contemplated, against, relating to or affecting Household or any
of its subsidiaries, which would, individually or in the aggregate, have a
Material Adverse Effect on Household, or prohibit or materially restrict the
consummation of the Transactions, nor is there any judgment, decree, order,
injunction, writ or rule of any Governmental Authority or any arbitrator
outstanding against Household or any of its subsidiaries having, or which,
insofar as can be reasonably foreseen, in the future is likely to have, a
Material Adverse Effect on Household. In addition, as of the date hereof, there
have not been any developments with respect to any of the claims, suits,
actions, proceedings, investigations or reviews disclosed in the Household SEC
Reports which, insofar as can be reasonably foreseen, in the future are likely
to have a Material Adverse Effect on Household.

Section 5.10 Insurance. With respect to each insurance policy providing
coverage for liability exposure (including policies providing property,
casualty, liability and workers' compensation coverage and bond and surety
arrangements) to which Household is currently a party, a named insured or
otherwise the beneficiary of coverage, to the knowledge of Household, (a) the
policy is legal, valid, binding, enforceable and in full force and effect; (b)
there will be no breach or other violation of the policy resulting from the
Transactions; and (c) Household is not in breach or default (including with
respect to the payment of premiums or the giving of notices), and no event has
occurred which, with notice or the lapse of time, would constitute such a
breach or default, or permit termination, modification or acceleration, under
the policy.

Section 5.11 Brokers. Other than Lehman Brothers, no broker, finder or
investment banker is entitled to any brokerage, finder's or other fee or
commission in connection with the Transactions based on any arrangement or
agreement made by or on behalf of Household.

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Section 5.12 Taxes. (a) Household and each of its subsidiaries has timely
filed (or has had timely filed on its behalf) or will file or cause to be
timely filed, all material Tax Returns required by applicable law to be filed
by it prior to or as of the Effective Time. All such Tax Returns and amendments
thereto are, or will be before the Effective Time, true, complete and correct
in all material respects.

(b) Each of Household and its subsidiaries has paid (or has had paid on its
behalf), or has established (or has had established on its behalf and for its
sole benefit and recourse), or will establish or cause to be established on or
before the Closing Date, an adequate accrual for the payment of, all material
Taxes due with respect to any period ending prior to or as of the Closing Date.

(c) No deficiency or adjustment for any material Taxes has been proposed,
asserted or assessed against Household or any of its subsidiaries that has not
been resolved or paid or for which an adequate accrual has not been established
in accordance with GAAP. There are no Liens for material Taxes upon the assets
of Household or any of its subsidiaries, except Liens for current Taxes not yet
due.

(d) No federal, state, local or foreign audits or other administrative or
court proceedings are pending or, to the knowledge of any employee of Household
with responsibility for Taxes, threatened with regard to any Tax Returns or
Taxes of Household or any of its subsidiaries which, if determined adversely,
would have a Material Adverse Effect on Household.

Section 5.13 Reliance. In entering into this Agreement, Household has relied
solely on representations made in this Agreement, including the Disclosure
Letter hereto, and any certificates and documents required to be provided by
RHI pursuant to this Agreement. Household has been represented by counsel and
has had sufficient opportunity to examine and understand the business and
assets of RHI.

Section 5.14 Financial Capability. Household will have on the Closing Date
and immediately prior to and at the Effective Time, funds and authorized and
unissued shares of Household Common Stock sufficient to consummate the Merger
and the Transactions.

ARTICLE VI

COVENANTS

Section 6.1 Notification of Certain Matters. Each of the parties hereto
shall give prompt notice to the other parties hereto of the occurrence or
nonoccurrence of any event to which such party becomes aware, the occurrence or
nonoccurrence of which would be reasonably likely to cause (a) any
representation or warranty contained in this Agreement to be untrue or
inaccurate in any material respect, or (b) any covenant, condition or agreement
contained in this Agreement not to be complied with or satisfied in any
material respect. The delivery of any notice pursuant to this Section 6.1 shall
not limit or otherwise affect the remedies available hereunder to the party
receiving such notice, except that RHI may amend any of the Schedules to
disclose any information that was omitted in good faith at the time the
Schedules were prepared that individually and in the aggregate do not have a
Material Adverse Effect on RHI.

Section 6.2 Further Action, Reasonable Efforts; Consents and Approvals. Upon
the terms and subject to the conditions hereof, each of the parties hereto
shall use commercially reasonable efforts to take, or cause to be taken, all
appropriate action, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the transactions in as expeditious a manner as is reasonably
practicable, including, without limitation, using commercially reasonable
efforts to obtain all licenses, permits, consents, approvals, authorizations,
certificates, qualifications and orders of, and make all filings and required
submissions with, all Governmental Authorities, and all shareholders, lenders
and partners of, and parties to Contracts with, Household, RHI or any other
Person, in each case, as are reasonably necessary for the consummation of the
Transactions (collectively "Consents"), except for such other consents,
authorizations filings, approvals and registrations which if not obtained or
made would not have a Material Adverse Effect on RHI or Household. RHI shall,
as soon as possible prior to the Closing, deliver to Household

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copies of all Consents obtained by RHI. Household shall, as soon as possible
prior to the Closing, deliver to RHI copies of all Consents obtained by
Household. In case at any time after the Closing Date any further action is
necessary or desirable to carry out the purposes of this Agreement, each of
Household and RHI shall use its commercially reasonable efforts to take all
such action. Prior to the Closing, each party shall use its commercially
reasonable efforts not to take any action, or enter into any transaction, that
would cause any of its representations or warranties contained in this
Agreement to be untrue.

Section 6.3 Regulatory Filings. (a) Without limiting the generality of
Section 6.2 hereof, Household and RHI shall (i) take promptly all actions
necessary to make the filings required of Household, RHI, or any of their
respective Affiliates in order to obtain any Requisite Regulatory Approval,
(ii) comply at the earliest practicable date with any request for information
or documentary material received by Household, RHI, or any of their respective
Affiliates from any Governmental Authority and (iii) cooperate with each other
in connection with any such filing and with resolving any investigation or
other inquiry concerning the transactions contemplated by this Agreement
commenced by any Governmental Authority.

(b) In furtherance and not in limitation of the covenants contained in
Section 6.2 and Section 6.3(a) hereof, each of Household and RHI shall use its
reasonable best efforts to resolve such objections, if any, as may be asserted
with respect to the Merger or any other transactions contemplated by this
Agreement under any applicable law. If any administrative, judicial or
legislative action or proceeding is instituted (or threatened to be instituted)
challenging the Merger or any other transaction contemplated by this Agreement
as violative of any applicable law, each of Household and RHI shall cooperate
and use its reasonable best efforts vigorously to contest and resist any such
action or proceeding, and to have vacated, lifted, reversed or overturned any
decree, judgment, injunction or other order (whether temporary, preliminary or
permanent) that is in effect and that restricts, prevents or prohibits
consummation of the Merger or any other transaction contemplated by the
Agreement.

(c) Each of Household and RHI shall promptly inform the other of any
communications received by such party or any of its Affiliates from any
Governmental Authority regarding any of the transactions contemplated hereby.
Each of Household and RHI shall advise the other promptly of any
understandings, undertakings or agreements which such party or any of its
Affiliates proposes to make or enter into with any Governmental Authority in
connection with the transactions contemplated hereby. Household or any of its
Affiliates shall not be obligated to enter into any undertakings,
understandings or agreements with any Governmental Authority if such
undertakings, understandings or agreements are reasonably unacceptable to
Household.

Section 6.4 Conduct of Business of RHI Pending the Closing. From the date
hereof through the Closing, except as expressly permitted or contemplated by
this Agreement or as set forth on Schedule 6.4 to the Disclosure Letter, unless
Household shall otherwise agree in writing (which agreement shall not be
unreasonably withheld) prior to the taking of any action prohibited by the
terms of this Section 6.4, RHI and its subsidiaries shall conduct their
operations and business in the ordinary and usual course of business and use
reasonable efforts (which shall not include any offer to pay any retention or
stay bonus without Household's consent, such consent not to be unreasonably
withheld or delayed) to keep available the services of its present officers and
key employees and preserve the goodwill and business relationships with all
Persons having business relationships with it. Without limiting the generality
of the foregoing, and except as otherwise expressly permitted by this
Agreement, prior to the Closing, without the prior written consent of
Household, which consent shall not be unreasonably withheld or delayed, neither
RHI nor any of its subsidiaries shall:

(a) amend or modify its Organizational Documents;

(b) issue, sell, pledge or dispose of, grant or otherwise create, or
agree to issue, sell, pledge or dispose of, grant or otherwise create any
capital stock or other equity securities, any debt or other securities
convertible into or exchangeable for any of its capital stock or other
equity securities, or any Option with respect thereto, except:

(i) for the issuance of stock upon the exercise of outstanding RHI
Stock Options; and

(ii) for the issuance of shares on the terms set forth in Section
6.20 in respect of Options cancelled pursuant to Section 7.3(f);

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(c) purchase, redeem or otherwise acquire or retire, or offer to
purchase, redeem or otherwise acquire or retire, any of its capital stock
or other equity securities (including any options with respect to any of
its capital stock or other equity securities and any securities convertible
or exchangeable into any of its capital stock or other equity securities)
or any long term debt;

(d) declare, set aside, make or pay any dividend or other distribution,
payable in cash, stock, property or otherwise, with respect to any of its
capital stock or other equity securities (except dividends declared and
paid by Orchard Federal Savings Bank to UICI, Inc., or by a subsidiary of
RHI only to RHI or a wholly-owned subsidiary of RHI, and except for
distributions of cash in the case of the securitization entities), or
subdivide, reclassify, recapitalize, split, combine or exchange any of its
capital stock or other equity securities;

(e) except for Federal Home Loan Bank borrowings and issuances of
deposits and certificates of deposits, including DTC certificates of
deposits, in the ordinary course of business to fund receivables and Loans,
incur or become contingently liable with respect to any indebtedness for
borrowed money or guarantee any such indebtedness or issue any debt
securities, except for additional indebtedness incurred under existing debt
agreements or credit facilities, or new credit facilities, provided,
however, that such new credit facilities are terminable by RHI or its
subsidiaries on no more than ninety (90) days notice and RHI or its
subsidiaries is not obligated for any termination fee, breakage costs or
other costs and expenses in excess of $100,000 as a result of such
termination;

(f) acquire or agree to acquire by merging or consolidating with, or by
purchasing a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation,
partnership, association or other business entity;

(g) mortgage or otherwise encumber or subject to any Lien, or sell,
transfer or otherwise dispose of, any assets or properties that are
material, individually or in the aggregate, to RHI and its subsidiaries,
taken as a whole, other than Liens incurred in the ordinary course of
business consistent with past practice, and sales and dispositions in the
ordinary course of business consistent with past practice;

(h) except (x) as may be required by applicable Law, (y) as contemplated
by this Agreement or (z) as set forth in the minutes of the Board of
Directors of RHI of November 21, 1999 as reflected in the Disclosure Letter
(the "January Bonus"), any RHI Benefit Arrangement or RHI Option Plan, or
RHI's standard compensation and bonus arrangements, consistent with past
practice, and provided that the aggregate bonuses paid (other than the
January Bonus) shall not exceed the sum of $2,368,559 plus 11% of the pre-
tax income (as determined by GAAP, consistently applied) of RHI before the
effect of such bonuses for the calendar quarter ended December 31, 1999 and
before the effect of revenue and expense related to or arising as a result
of the Transactions or this Agreement, (i) enter into any employment
agreement, (ii) increase the compensation payable or to become payable to
its executive officers or employees, except for increases in the ordinary
course of business consistent with past practice with respect to employees
who are not subject to written employment contracts, (iii) grant any
severance or termination pay to any director, executive officer or employee
of RHI or any subsidiary of RHI, except with respect to non-executive
officer employees in the ordinary course of business or pursuant to
existing RHI Benefit Plans, (iv) enter into any severance agreement or
retention agreement with any director, executive officer or employee except
with respect to non-executive officer employees in the ordinary course of
business, or (v) establish, adopt, enter into, terminate, withdraw from or
amend in any material respect or take action to accelerate any rights or
benefits under any collective bargaining agreement, any stock option plan,
or any Benefit Plan or Benefit Arrangement;

(i) take any action, other than reasonable actions in the ordinary
course of business, with respect to accounting policies or procedures
(including Tax accounting policies, procedures and elections relating to
Taxes that would apply to RHI and its subsidiaries, Household or the
Surviving Corporation after the Merger), except as may be required by GAAP,
consistently applied, or changes in law, or settle any material audit or
litigation or, except as required by Law, amend in any material respect any
material Tax Return;

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(j) enter into, modify, amend, extend or terminate any agreement or
agreements for goods, property rights or services with (i) any director or
officer, or any Affiliate of such Person, or (ii) any other Person which
obligates RHI, or any affiliate of RHI, to pay in excess of $250,000 in any
twelve (12) month period unless Household has not disapproved of a
transaction described in this clause (ii) within two (2) Business Days of
receipt of notice of the transaction; provided, however, that RHI may offer
employment to individuals consistent with past practice; and

(k) authorize any of, or commit or agree to take any of, the foregoing
actions.

Section 6.5 Conduct of Business of Household Pending the Closing. From the
date hereof through the Closing, except as expressly permitted or contemplated
by this Agreement, unless RHI shall otherwise agree in writing (which agreement
shall not unreasonably be withheld) prior to the taking of any action
prohibited by the terms of this Section 6.5, Household and its subsidiaries
shall conduct their operations and business in the ordinary and usual course of
business and consistent with past practice and use reasonable efforts to keep
available the services of its present officers and key employees and preserve
the goodwill and business relationships with all Persons having business
relationships with it.

Section 6.6 Access to Information. (a) From the date hereof to the Effective
Time, RHI shall (and shall cause its respective subsidiaries and
Representatives to) afford the Representatives of Household reasonable access
at all reasonable times during normal business hours to its officers,
employees, agents, properties, offices, plants and other facilities, books,
records and Tax Returns, and shall furnish such Representatives with all
financial, operating and other data and information as may be reasonably
requested.

(b) Each of Household, the Merger Sub and RHI covenants and agrees to
maintain the confidentiality of any Confidential Information, as defined
herein, it receives from any other party or such party's subsidiaries or
affiliates and, except as expressly permitted in this Agreement or as required
by law or in connection with judicial proceedings, shall not disclose any such
Confidential Information to third parties. A party receiving Confidential
Information from another party shall use at least the same degree of care to
maintain its confidentiality as it uses to maintain its own Confidential
Information. A party receiving Confidential Information shall not, except in
connection with this Agreement, directly or indirectly use Confidential
Information of the disclosing party without the prior written consent of such
disclosing party. As used in this Agreement, "Confidential Information"
includes, without limitation, information not previously disclosed to the
public or to the trade by a party to this Agreement relating to its products,
facilities and methods, trade secrets and other intellectual property,
software, source code, systems, procedures, manuals, confidential reports,
product price lists, customer lists, financial information (including revenues,
costs or profits associated with any product), business plans, prospects, or
opportunities, but shall exclude any information already in the public domain.

Section 6.7 No Solicitation. (a) RHI shall not, nor shall it permit any of
its subsidiaries to, and it shall instruct its Representatives (including,
without limitation, any investment banker, attorney or accountant retained by
RHI or a subsidiary of RHI) not to, directly or indirectly, for or on its
behalf (i) knowingly initiate, solicit or encourage any inquiries or proposals
that constitute, or could reasonably be expected to lead to, a proposal or
offer for a merger, consolidation, or business combination of RHI or any of its
subsidiaries, or the sale of assets representing a substantial portion of the
assets of RHI and its subsidiaries, taken as a whole, or the sale of shares of
capital stock of RHI or any subsidiary (other than to RHI or a subsidiary of
RHI or as permitted by Section 6.4 hereto), including, without limitation, by
way of a tender offer or exchange offer by any Person other than the
Transactions (any of the foregoing inquiries or proposals being referred to in
this Agreement as an "Acquisition Proposal"), (ii) engage in negotiations or
discussions concerning, or provide to any Person or entity any Confidential
Information or data relating to RHI or any subsidiary of RHI for the purposes
of, or otherwise cooperate with or assist or participate in, facilitate or
encourage, any inquiries or the making of any Acquisition Proposal, (iii) agree
to, approve or recommend any Acquisition Proposal, or (iv) take any other
action inconsistent with the obligations and commitments assumed by RHI
pursuant to this Section 6.7; provided, however, that nothing contained in this
Agreement shall prevent RHI or its Board of

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Directors from furnishing Confidential Information to, or entering into
discussions or negotiations with, any person or entity in connection with an
unsolicited bona fide written Acquisition Proposal to RHI or its stockholders
(which may be subject to a "due diligence" condition), if and only to the
extent that (1) the Board of Directors of RHI determines in good faith (after
consultation with outside legal counsel) that such action could reasonably be
required for such Board of Directors to comply with its fiduciary duties to
stockholders under applicable law, and (2) prior to furnishing such
Confidential Information to, or entering into discussions or negotiations with,
such person or entity, RHI receives from such person or entity an executed
confidentiality agreement. RHI and its Representatives will immediately cease
and cause to be terminated any existing activities, discussions or negotiations
by RHI or its Representatives with any parties conducted heretofore with
respect to any of the foregoing. In addition, notwithstanding the provisions of
this Section 6.7, or any other provision of this Agreement, RHI may (i)
withdraw, modify, or refrain from making its recommendation in accordance with
Section 6.8 and (ii) terminate this Agreement in accordance with Section
8.1(f).

(b) RHI shall (i) promptly notify Household in writing after receipt by RHI
(or its Representatives) of any Acquisition Proposal or any inquiries
indicating that any Person is considering making or wishes to make an
Acquisition Proposal, which notification shall be in writing and shall contain
the principle financial terms of any such Acquisition Proposal, and (ii)
promptly notify Household in writing after receipt of any request for
Confidential Information relating to it or any of its subsidiaries or for
access to its or any of its subsidiaries' properties, books or records by any
person that, to RHI's Knowledge, may be considering making, or has made, an
Acquisition Proposal.

Section 6.8 Stockholder Meeting. RHI shall take all action necessary, in
accordance with the OCL and RHI's Organizational Documents, to call a meeting
of its stockholders (the "RHI Meeting") to be held as promptly as practicable
after the effective date of the Household Registration Statement for the
purpose of considering and voting upon this Agreement and the Merger (the "RHI
Stockholder Approval"). The Board of Directors of RHI shall recommend that the
stockholders of RHI approve this Agreement and the Merger; provided, however,
that the Board of Directors of RHI, by action of a majority of the entire Board
of Directors of RHI, may withdraw, modify or refrain from making such
recommendation if such Board of Directors determines in good faith, after
receipt of an Acquisition Proposal and after consultation with outside legal
counsel, that the withdrawal or modification of or failure to make such
recommendation could reasonably be required for such Board of Directors to
comply with its fiduciary duties under applicable law.

Section 6.9 Registration Statement and Proxy Statement. (a) As promptly as
practicable after the execution of this Agreement, (i) Household and RHI shall
prepare and file with the SEC a registration statement on Form S-4 (together
with all amendments thereto, the "Household Registration Statement"), in which
the proxy statement for the RHI Meeting ("Proxy Statement") shall be included,
in connection with the registration under the Securities Act of the shares of
Household Common Stock to be issued pursuant to the Merger. Each of Household
and RHI (i) shall cause the Proxy Statement and the Household Registration
Statement to comply as to form in all material respects with the OCL, the
Securities Act, the Exchange Act and the rules and regulations thereunder, as
applicable (ii) shall use commercially reasonable efforts to have or cause the
Household Registration Statement to become effective as promptly as
practicable, and (iii) shall take any and all action required under any
applicable Federal or state securities laws in connection with the issuance of
shares of Household Common Stock pursuant to the Merger or the OCL in
connection with the RHI Meeting. Household and RHI shall furnish to the other
all information concerning Household and RHI as the other may reasonably
request in connection with the preparation of the documents referred to herein.
Each of Household and RHI will notify the other promptly upon the receipt of
any comments from the SEC or its staff or any other governmental officials and
of any request by the SEC or its staff or any other governmental officials for
amendments or supplements to the Household Registration Statement, Proxy
Statement or any other filing or for additional information and will supply the
other with copies of all correspondence between such party or any of its
Representatives, on the one hand, and the SEC, or its staff or any other
governmental officials, on the other hand, with respect to the Household
Registration Statement, Proxy Statement or other filing. Each of Household and
RHI will cause all documents that it is responsible for filing with the SEC or

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other regulatory authorities under this Section 6.9 to comply in all material
respects with all applicable requirements of law and the rules and regulations
thereunder. Whenever Household or RHI obtains knowledge of the occurrence of
any event which is required to be set forth in an amendment or supplement to
the Proxy Statement, the Household Registration Statement or other filing,
Household or RHI, as the case may be, will promptly inform the other of such
occurrence and cooperate in filing with the SEC or its staff or any other
governmental officials, and or mailing to Stockholders of RHI such amendment or
supplement. As promptly as practicable after the Household Registration
Statement shall have become effective, RHI shall cause the Proxy Statement to
be mailed to its stockholders.

(b) The information supplied by each of Household and RHI for inclusion in
the Household Registration Statement and the Proxy Statement shall not (i) at
the time the Household Registration Statement is declared effective and (ii) at
the time the Proxy Statement (or any amendment thereof or supplement thereto)
is first mailed to the stockholders of RHI, (iii) at the time of the RHI
Meeting, or (iv) at the Effective Time, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading. If, at any
time prior to the Effective Time, any event or circumstance relating to RHI,
any subsidiary of RHI, Household, any subsidiary of Household, or their
respective officers or directors, should be discovered by such party which
should be set forth in an amendment or a supplement to the Household
Registration Statement or the Proxy Statement, such party shall promptly inform
the other thereof and take appropriate action in respect thereof.

(c) As soon as practicable after the Effective Time, Household shall file a
registration statement on SEC Form S-8 with respect to the Household Common
Stock to be issued upon exercise of RHI Stock Options, and shall use its
reasonable best efforts to maintain the effectiveness of such registration for
so long as any RHI Stock Options remain outstanding.

Section 6.10 Letters of Accountants. RHI shall use commercially reasonable
efforts to cause to be delivered to Household a "comfort" letter of KPMG LLP,
RHI's independent public accountants, dated and delivered on the date on which
the Household Registration Statement shall become effective and as of the
Effective Time, and addressed to the Board of Directors of Household relating
to the performance of KPMG LLP of customary procedures with respect to the
financial statements of RHI contained in the Household Registration Statement,
including a review of the interim financial statement information as described
in SAS No. 71.

Section 6.11 Incentive Compensation Plan and Post-Closing Operation Intent.
RHI shall adopt The Renaissance Incentive Compensation Plan (the "Incentive
Plan") for the benefit of selected employees of RHI and its subsidiaries, and
shall submit the Incentive Plan for approval of its stockholders at the RHI
Meeting. If the Incentive Plan is approved at the RHI Meeting by a vote of 75%
of the shares eligible to vote thereon as determined pursuant to Code Section
280G(b)(5)(B), then Household shall assume the Incentive Plan immediately after
the Effective Time. The Incentive Plan shall be substantially in the form set
forth as Exhibit G hereto. Household intends to have RHI manage the operation
of Household's United States subprime Visa and MasterCard credit card business
after a transition period following the Effective Time.

Section 6.12 Public Announcements. At all times at or before the Closing,
neither RHI nor Household shall issue or make, directly or indirectly, any
reports, statements or releases to the public with respect to this Agreement or
the Transactions contemplated hereby without the prior written consent of the
other, which consents shall not be unreasonably withheld or delayed; provided,
however, that RHI and Household may, without the prior written consent of the
other, issue or make, directly or indirectly, any report, statement or release
required by Law, its fiduciary obligations or any listing agreement or
arrangement to which such Person is a party with a national securities exchange
or national market system if the other parties to this Agreement are so
notified as soon as possible in advance of such report, statement or release
and, to the extent practicable, given a reasonable opportunity to review and
comment on the report, statement or release. The parties will agree to the text
of the press releases announcing the signing of the Agreement.

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Section 6.13 Blue Sky. Household shall use its best efforts to obtain prior
to the Effective Time all approvals or permits required to carry out the
transactions contemplated hereby under applicable Blue Sky Laws in connection
with the issuance of shares of Household Common Stock in the Merger and as
contemplated by this Agreement; provided, however, that with respect to such
qualifications neither Household nor RHI shall be required to register or
qualify as a foreign corporation or to take any action which would subject it
to general service of process or taxation in any jurisdiction where any such
entity is not now so subject.

Section 6.14 NYSE Listing. Household shall promptly prepare and submit to
the NYSE listing applications covering the shares of Household Common Stock to
be issued in the Merger, and shall use its best efforts to cause such shares to
be approved for listing and trading on the NYSE prior to the Effective Time,
subject to official notice of issuance.

Section 6.15 Rule 145 Affiliates. Within five days after the Proxy Statement
is mailed to the stockholders of RHI, (a) RHI shall deliver to Household a
letter identifying all persons who may be deemed to be affiliates of RHI under
Rule 145 of the Securities Act as of the date of the RHI Meeting (the "Rule 145
Affiliates") and (b) RHI shall advise the persons identified in such letter of
the resale restrictions imposed by applicable securities laws and shall use
commercially reasonable efforts to obtain prior to the Effective Day from each
person identified in such letter a written agreement, substantially in the form
of Exhibit A hereto (a "Rule 145 Affiliate Agreement"). Household acknowledges
and agrees that none of the Rule 145 Affiliates shall be deemed to be
affiliates of Household, as defined in Rule 144 of the Securities Act,
following the Closing.

Section 6.16 Indemnification with Respect to the Registration Statement. (a)
Each party hereto shall (i) indemnify (in such role, an "Indemnifying Party")
and hold harmless each other party and their respective directors, officers and
controlling persons (an "Indemnified Party") against any and all loss,
liability, claim, damage and expense whatsoever to which an Indemnified Party
may become subject, under the Securities Act, the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of any untrue statement or alleged untrue statement of a
material fact contained in the Household Registration Statement or the Proxy
Statement, or any amendment or supplement thereto, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading; and (ii) will
reimburse the Indemnified Party for any legal or other expenses reasonably
incurred by the Indemnified Party in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that (i) RHI shall be liable under this Section
6.16 only for information provided by RHI and relating to RHI or related to the
effect on holders of Options or the recipients of payments under the Incentive
Plan of the votes required by Section 6.20(d) and Section 6.11, respectively,
included in the Household Registration Statement or Proxy Statement, (ii)
Household and Merger Sub shall be liable under this Section 6.16 only for
information provided by Household and relating to Household and Merger Sub
included or incorporated by reference in the Household Registration Statement
or Proxy Statement, and (iii) no Indemnifying Party will be liable in any such
case under this Section 6.16 to the extent that any such loss, claim, damage,
liability or action arises out of any untrue statement or alleged untrue
statement or omission or alleged omission made in any of such documents in
reliance upon and in conformity with written information furnished to the
Indemnifying Party by or on behalf of such Indemnified Party specifically for
use therein.

(b) Promptly after receipt by an Indemnified Party under this Section 6.16
of notice of any claim or the commencement of any action, the Indemnified Party
shall, if a claim in respect thereof is to be made against the Indemnifying
Party under this Section 6.16, promptly notify the Indemnifying Party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify or a delay in notifying the Indemnifying Party shall
not relieve it from any liability which it may have to an Indemnified Party
otherwise than under this Section 6.16 except to the extent that such
Indemnifying Party is prejudiced thereby. If any such claim or action shall be
brought against an Indemnified Party, and it shall notify the Indemnifying
Party thereof, the Indemnifying Party shall be entitled to participate therein,
and, to the extent that it wishes, jointly with any

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other similarly notified Indemnifying Party, to assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party. After notice from the
Indemnifying Party to the Indemnified Party of its election to assume the
defense of such claim or action, the Indemnifying Party shall not be liable to
the Indemnified Party under this Section 6.16 for any legal or other expenses
subsequently incurred by the Indemnified Party in connection with the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the employment thereof has been specifically
authorized by the Indemnifying Party in writing, (ii) such Indemnified Party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the Indemnifying Party and in the reasonable judgment of such
counsel it is advisable for such Indemnified Party to employ separate counsel
or (iii) the Indemnifying Party has failed to assume the defense to such claim
or action and employ counsel reasonably satisfactory to the Indemnified Party,
in which case, if such Indemnified Party notifies the Indemnifying Party in
writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense of such claim or action on behalf of such Indemnified Party; it
being understood, however, that the Indemnifying Party shall not, in connection
with any one such claim or action or separate but substantially similar or
related claims or actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all such
Indemnified Parties, which firm shall be designated in writing by such
Indemnified Parties. Each Indemnified Party, as a condition of the indemnity
agreements contained herein shall use its best efforts to cooperate with the
Indemnifying Party in the defense of any such claim or action. The Indemnifying
Party shall not be liable for any settlement of any such claim or action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment in favor of the plaintiff in any such claim or action, the
Indemnifying Party agrees to indemnify and hold harmless any Indemnified Party
from and against any loss or liability by reason of such settlement or
judgment.

Section 6.17 Directors' and Officers' Indemnification and Insurance. (a)
From and after the Effective Time, the Surviving Corporation shall indemnify,
defend and hold harmless the present and former officers and directors of RHI
and its subsidiaries (the "Indemnified Officers/Directors") against all losses,
expenses (including attorneys fees), claims, damages, liabilities or amounts
("Losses") that are paid in settlement (provided that such settlement has been
approved by Household, such approval not to be unreasonably withheld) of, or
otherwise in connection with, any claim, action, suit, proceeding or
investigation, based in whole or in part on the fact that such person is or was
a director or officer of RHI and arising out of actions or omissions occurring
at or prior to the Effective Time (including, without limitation, the
Transactions), in each case, to the full extent permitted under the OCL and
RHI's articles of incorporation and bylaws (to the extent permitted by
applicable law) as in effect on the date of this Agreement.

(b) The Surviving Corporation shall keep in effect provisions in its
articles of incorporation and bylaws providing for exculpation of director
liability and its indemnification of the Indemnified Officers/Directors to the
fullest extent permitted under the DGCL, which provisions shall not be amended
except as required by applicable law or except to make changes permitted by law
that would enlarge the right of indemnification of the Indemnified
Officers/Directors. The Surviving Corporation shall keep in effect and to
comply with the terms and conditions of the indemnification agreements between
RHI and each of its directors in effect as of the date of this Agreement.

(c) For a period of six years after the Effective Time, the Surviving
Corporation shall maintain in effect the current policies of directors' and
officers' liability insurance maintained by RHI, or policies providing
substantially the same coverage, covering persons who are currently covered by
RHI's officers' and directors' liability insurance policies with respect to
actions or omissions occurring at or prior to the Effective Time, a true and
correct summary of which is set forth on Schedule 6.17 to the Disclosure
Letter, to the extent that such policies are available; provided, however, that
policies of at least the same coverage containing terms and conditions which
are no less advantageous to the insureds may be substituted therefor.

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(d) The provisions of this Section 6.17 shall survive the consummation of
the Merger and expressly are intended to benefit each of the Indemnified
Officers/Directors.

Section 6.18 Employee Matters. (a) Household will cause all RHI employees to
be eligible to participate as soon as practicable (i) in any holiday, sick
leave, vacation pay, leave of absence, or similar policy of Household in which
similarly situated employees of Household are generally eligible to participate
without duplication of benefits and (ii) in the Benefit Plans of Household, as
they may be amended in the future, in which similarly situated employees of
Household are generally eligible to participate. Subject to the following
sentence, the benefit design and benefit levels (regardless of any cost
differentials) under such plans, benefits and policies, when taken as a whole,
shall be substantially comparable to the existing RHI plans, benefits and
policies. In determining whether plans, benefits and policies are comparable,
it is necessary to consider the entire compensation package including base pay,
potential bonus and/or incentive pay opportunity, plans and benefits. Household
will use its best efforts, to the extent practicable, to admit employees to the
foregoing plans on the Closing Date or, if not feasible, no later than the
first entry date following the Closing Date. In addition, as of the Closing
Date, Household will cover or maintain coverage of RHI employees and their
dependents under a Household or RHI group health plan, subject to the rules
applicable to other similarly situated employees of Household, without regard
to any preexisting condition exclusions or, to the extent the RHI employee was
covered by such a plan before the Closing Date, any waiting periods, or similar
limitations under any Benefit Plans of Household. For purposes of any seniority
or length of service requirements, waiting periods, vesting periods, or
differential benefits based on length of service in any such plan or policy of
Household as of the Closing Date for which a RHI employee may be eligible after
the Closing, Household shall treat service by such employee with RHI as though
it had been service with Household for all purposes under any such plan or
policy to the extent RHI credited such service under its similar plans,
excluding vesting, benefit accruals, or accrual or account formulas under any
defined benefit plan maintained by Household, so long as this crediting of
service does not violate applicable laws and is consistent with the rules
governing Benefit Plans qualified under Section 401(a) of the Code and
permitted by the terms of such plans and arrangements and by third-party
administrators and insurers.

(b) Any communications proposed to be delivered to the RHI employees before
the Closing regarding the matters contained in or the Transactions contemplated
under the Merger Agreement or otherwise respecting any changes or potential
changes in employee benefit plans, practices, or procedures that may or will
occur in connection with the Transactions contemplated by the Merger Agreement,
shall be subject to the prior approval of Household or RHI, respectively, which
approval shall not be unreasonably withheld and who shall be deemed to have
approved a proposed communication absent objection provided within 72 hours of
receipt of the proposed communications.

(c) Nothing in this Merger Agreement shall (a) restrict or otherwise inhibit
Household's right to terminate the employment of any RHI employee on or after
the Closing Date or (b) be construed or interpreted to restrict Household's
right or authority to amend or terminate any of its employee benefit plans,
policies or programs effective on or after the Closing Date. Nothing expressed
or implied in the Merger Agreement shall give any RHI employee any third party
beneficiary rights or other rights to sue under or with respect to the Merger
Agreement except as set forth in Section 9.9 of the Merger Agreement.

Section 6.19 Tax-Free Reorganization. Household, Merger Sub and RHI each
acknowledges and agrees that, unless the Merger is a Cash Merger, (i) it
intends the Merger to constitute a reorganization within the meaning of Section
368(a) of the Code, as amended, and (ii) to the extent permissible by law, it
will report the Merger as such a reorganization in any and all federal, state
and local income Tax returns filed by it. No party shall take any voluntary
action either prior to or after the Closing Date that could reasonably be
expected to cause the Merger to fail to qualify as a "reorganization" under
Section 368(a) of the Code. Unless the Merger is a Cash Merger, Household,
Merger Sub, and RHI will each execute and deliver to Wilmer, Cutler & Pickering
and Stoel Rives LLP tax representation letters substantially in the forms set
forth in Exhibit F hereto for purposes of the review of the federal income tax
consequences of the Merger and preparation of the discussion of tax
consequences of the Merger to be included in the Household Registration
Statement.

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Section 6.20 Issuances with Respect to Option Cancellations. RHI may issue
shares of common stock of RHI and pay additional compensation with respect to
Options cancelled pursuant to Section 7.3(f) only on the conditions set forth
in this Section 6.20.

(a) Number of Shares Issued. RHI may issue no later than the day before
the Closing Date, for each share of common stock of RHI into which an
Option could have been exercised when vested in full, the number of shares
of common stock of RHI equal to a fraction, the numerator of which is the
Cash Consideration minus the exercise price of the Option and the
denominator of which is the Cash Consideration.

(b) Restrictions on Shares. Any shares of common stock of RHI issued
with respect to the cancellation of the non-qualified Options identified in
Schedule 7.3(f)(1) to the Disclosure Letter and the incentive stock options
issued in 1999 identified in Schedule 7.3(f)(2) to the Disclosure Letter
shall be issued only if each holder of such Options enters into an
agreement pursuant to which the holder agrees not to sell any shares of
common stock of RHI received with respect to the cancellation of such
Options (or received as Merger Consideration with respect to such shares)
for a period of ten (10) years after the original issuance of the Option,
except that the holder may, if the holder is an employee of RHI, Household
or any Affiliate of Household at the time of sale, sell up to one-third of
such shares at any time after the first anniversary of the original
issuance of the Option, up to two-thirds of such shares at any time after
the second anniversary of the original issuance of the Option and sell all
of such shares at any time after the third anniversary of the original
issuance of the Option; provided, however, that these restrictions shall
terminate upon the termination of employment of a holder by the Surviving
Corporation other than for cause, where cause includes, but is not limited
to, the following types of conduct and circumstances: breach of any
material provision of any applicable employment agreement; material
violation of any statutory or common law duty of loyalty to RHI, Household
or any Affiliate of Household; conduct or performance that, in RHI's or
Household's reasonable judgment, adversely affects the interests of RHI,
Household or any Affiliate of Household; or conduct that, in RHI's or
Household's reasonable judgment, creates a conflict of interest between the
employee and RHI, Household or any Affiliate of Household.

(c) Cash Consideration. Subject to receipt of the shareholder vote
required by Section 6.20(d), RHI may issue additional cash in connection
with the cancellation of Options as follows:

(i) With respect to the non-qualified Options issued in 1999
identified in Schedule 7.3(f)(1) to the Disclosure Letter, an amount
for each share for which the Option could have been exercised when
vested in full equal to 23.83% of the difference between the Cash
Consideration minus the exercise price of the Option.

(ii) With respect to the incentive stock options identified in
Schedule 7.3(f)(2) to the Disclosure Letter, an amount for each share
for which the Option could have been exercised when vested in full
equal to 43.37% of the difference between the Cash Consideration minus
the exercise price of the Option.

No cash consideration may be paid with respect to the cancellation of the
Options identified in Schedule 7.3(f)(3) to the Disclosure Letter.

(d) Shareholder Vote. The payment of cash consideration pursuant to
Section 6.20(c) may be made only if such payment is approved by the
stockholders of RHI by a vote of 75% of the shares eligible to vote thereon
as determined pursuant to Code Section 280G(b)(5)(B).

(e) Accrual and Payment of Cash Consideration. RHI shall become liable
for any cash consideration payable pursuant to Section 6.20(c) on the date
the Options are cancelled. The payment shall be made, at Household's
option, by Household or the Surviving Corporation or in part by each no
earlier than the fifteenth day following the Closing Date.

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ARTICLE VII

CONDITIONS TO THE MERGER

Section 7.1 Conditions to Each Party's Obligation to Effect the Merger. The
respective obligations of each party to this Agreement to effect the Merger
shall be subject to the following conditions:

(a) All consents, approvals and action of any Governmental Authority
required to permit the consummation of the Transactions shall have been
obtained or made, free of any condition that would have a Material Adverse
Effect on Household or RHI.

(b) No action shall have been taken, and no statute, rule, regulation,
executive order, judgment, decree, or injunction (other than a temporary
restraining order) shall have been enacted, entered, promulgated or
enforced (and not repealed, superseded, lifted or otherwise made
inapplicable), by any court of competent jurisdiction or Governmental
Authority which restrains, enjoins or otherwise prohibits the consummation
of the Merger (each party agreeing to use its commercially reasonable
efforts to avoid the effect of any such statute, rule, regulation or order
or to have any such order, judgment, decree or injunction lifted).

(c) The Household Registration Statement shall have become effective in
accordance with the provisions of all applicable Federal securities laws,
rules and regulations, and no stop order suspending such effectiveness
shall have been issued and remain in effect.

(d) The shares of Household Common Stock shall have been approved for
listing on the NYSE, subject only to official notice of issuance.

(e) Any applicable waiting period under the HSR Act shall have expired
or been terminated.

(f) RHI shall have received the RHI Stockholder Approval.

(g) The GECC Stockholder Agreement and all Stockholder Agreements shall
have been executed, received, and shall be in full force and effect and
shall not have been modified or terminated without the written consent of
Household and RHI and all obligations thereunder required to be completed
on or prior to the Closing Date shall have been completed on or before the
Effective Time.

(h) Unless the Merger is a Cash Merger, Household and Merger Sub shall
have received an opinion from Wilmer, Cutler & Pickering in form and
substance reasonably satisfactory to Household and Merger Sub, and RHI
shall have received an opinion from Stoel Rives LLP in form and substance
reasonably satisfactory to RHI, each dated as of the Closing Date and each
to the effect that the Merger constitutes a reorganization within the
meaning of Section 368(a) of the Code.

(i) The Employment Agreements and the Loan Agreement shall have been
executed by the applicable parties thereto, delivered to Household, and
shall be in full force and effect and shall not have been modified or
terminated without the written consent of Household.

Section 7.2 Conditions to Obligations of RHI to Effect the Merger. The
obligations of RHI to effect the Merger are subject to the satisfaction of the
following conditions, unless waived by RHI:

(a) The representations and warranties of Household and Merger Sub
contained herein shall be true and accurate at and as of the Effective Time
as though made at the Effective Time (except to the extent a representation
or warranty speaks specifically as of an earlier date or has become untrue
or inaccurate because of Transactions contemplated herein).

(b) Household and Merger Sub shall have, in all material respects,
performed all obligations and complied with all covenants required by this
Agreement to be performed or complied with by them prior to the Effective
Time.

(c) Household shall have delivered to RHI a certificate, dated the
Effective Time and signed by its Chief Executive Officer or Chief Financial
Officer evidencing compliance with Sections 7.2(a) and (b).

(d) RHI shall have received an opinion of J.W. Blenke, counsel to
Household and Merger Sub, in form and substance reasonably satisfactory to
RHI, addressing the matters set forth in Exhibit B.

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Section 7.3 Conditions to Obligations of Household and Merger Sub to Effect
the Merger. The obligations of Household and Merger Sub to effect the Merger
are subject to the satisfaction of the following conditions, unless waived by
Household and Merger Sub:

(a) The representations and warranties of RHI contained herein shall be
true and accurate at and as of the Effective Time as though made at the
Effective Time (except in each case to the extent a representation or
warranty speaks specifically as of an earlier date or has become untrue or
inaccurate because of Transactions contemplated herein).

(b) RHI shall have, in all material respects, performed all obligations
and complied with all covenants required by this Agreement to be performed
or complied with by it prior to the Effective Time.

(c) RHI shall have delivered to Household a certificate, dated the
Effective Time and signed by its Chief Executive Officer or Chief Financial
Officer, evidencing compliance with Sections 7.3(a) and (b).

(d) Household and Merger Sub shall have received an opinion of Stoel
Rives LLP, counsel to RHI, in form and substance reasonably satisfactory to
Household and Merger Sub, addressing the matters set forth in Exhibit C.

(e) Irving Levin, Charles Engelberg, George Alexander and Karen Frolich
shall each have signed a non-competition agreement with Household in the
form set forth as Exhibit L.

(f) Each of the Options identified on Schedule 7.3(f) to the Disclosure
Letter shall have been cancelled by RHI prior to the Effective Time.

ARTICLE VIII

TERMINATION, WAIVER, AMENDMENT AND CLOSING

Section 8.1 Termination. This Agreement may be terminated and abandoned at
any time prior to the Effective Time, whether before or after approval of this
Agreement or the Merger by the stockholders of RHI:

(a) by the mutual written consent of RHI and Household;

(b) by RHI or Household, if (i) the Effective Time shall not have
occurred on or before the later of (A) 5:00 p.m. Chicago time on March 31,
2000, or (B) 5:00 p.m. Chicago time on the sixtieth (60th) day after the
mailing of the definitive Proxy Statement to holders of RHI Common Stock,
but in no event later than May 31, 2000, (ii) any Governmental Authority,
the consent of which is a condition to the obligations of RHI and Household
to consummate the Transactions, shall have determined not to grant its
consent and all appeals of such determination shall have been taken and
have been unsuccessful or (iii) any court of competent jurisdiction shall
have issued an order, judgment or decree (other than a temporary
restraining order) restraining, enjoining or otherwise prohibiting the
Merger and such order, judgment or decree shall have become final and
nonappealable; provided, however, that the right to terminate this
Agreement pursuant to clause (i) shall not be available to any party whose
failure to fulfill any obligation under this Agreement has been the cause
of, or resulted in, the failure of the Effective Time to occur on or before
such date;

(c) by RHI, if there has been a breach by Household of any
representation, warranty, covenant or agreement set forth in this
Agreement, which breach has not been cured within twenty (20) Business Days
following receipt by Household of notice of such breach from RHI; provided,
however, that the right to terminate this Agreement pursuant to this
Section 8.1(c) shall not be available to RHI if RHI, at such time, is in
breach of any representation, or warranty, or is in material breach of any
covenant or agreement set forth in this Agreement;

(d) by Household, if there has been a breach by RHI of any
representation, warranty, covenant or agreement set forth in this
Agreement, which breach has not been cured within twenty (20) Business Days
following receipt by RHI of notice of such breach from Household; provided,
however, that the right to terminate this Agreement pursuant to this
Section 8.1(d) shall not be available to Household if Household,

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at such time, is in breach of any representation, or is in material breach
of any warranty, covenant or agreement set forth in this Agreement,
provided, however, that Household's right to terminate pursuant to this
section shall not arise with respect to a breach of Section 6.4(j)(ii)
unless the aggregate amount RHI, or any affiliate of RHI, is obligated to
pay pursuant to agreements for which consent is not requested exceeds
$1,000,000 in the twelve (12) month periods referenced therein.

(e) by Household or RHI if, at the RHI Meeting (including any
adjournment or postponement thereof) called pursuant to Section 6.8 hereof,
the RHI Stockholder Approval shall not have been obtained; and

(f) by RHI if (i) RHI receives an alternative Acquisition Proposal, (ii)
RHI is not then in breach of Section 6.7, (iii) at least three (3) Business
Days prior to such termination, RHI shall have provided to Household
written notice (A) as to the material terms of any such Acquisition
Proposal and (B) that the Board of Directors of RHI in the exercise of its
good faith judgment as to fiduciary duties to stockholders under applicable
law, after consultation with outside legal counsel, has determined, by
action of a majority of the entire Board of Directors of RHI that such
termination could reasonably be required in order for such Board of
Directors to comply with such duties, and (iv) on the date of such
termination, the Board of Directors of RHI determines, by action of a
majority of the entire Board of Directors of RHI that such termination
could reasonably be required in order for such Board of Directors to comply
with its fiduciary duties to stockholders under applicable law (which
determination shall be made in light of any revised proposal made by
Household) and RHI concurrently enters into a definitive agreement
providing for the implementation of such Acquisition Proposal.

Section 8.2 Effect of Termination. In the event of termination of this
Agreement by RHI or Household as provided in Section 8.1 hereof, this Agreement
shall forthwith become void (except Sections 6.6(b), 6.16, 8.2, 8.5, 9.1, 9.2,
9.4, 9.5, 9.6, 9.7, 9.8, 9.9, 9.10, 9.11, 9.12(b), 9.14 or 9.15) and there
shall be no liability on the part of RHI, Household, Merger Sub or their
respective officers or directors, except for any material breach of a party's
obligations under Sections 6.6(b), 6.16, 8.2, 8.5, 9.1, 9.2, 9.4, 9.5, 9.6,
9.7, 9.8, 9.9, 9.10, 9.11, 9.12(b), 9.14 and 9.15. Notwithstanding the
foregoing, no party hereto shall be relieved from liability for any willful
breach of this Agreement.

Section 8.3 Amendment or Supplement. At any time before or after approval of
this Agreement by the stockholders of RHI and prior to the Effective Time, this
Agreement may be amended or supplemented in writing by RHI, Merger Sub and
Household with respect to any of the terms contained in this Agreement, except
that following approval by the stockholders of RHI there shall be no amendment
or supplement which by law requires further approval by such stockholders
without such further approval by the stockholders of RHI.

Section 8.4 Extension of Time, Waiver, Etc. At any time prior to the
Effective Time:

(a) Household may extend the time for the performance of any of the
obligations or acts of RHI, and RHI may extend the time for the performance
of any of the obligations or acts of Household or Merger Sub;

(b) Household may waive any inaccuracies in the representations and
warranties of RHI contained herein or in any document delivered pursuant
hereto, and RHI may waive any inaccuracies in the representations and
warranties of Household contained herein or in any document delivered
pursuant hereto; or

(c) Household may waive compliance with any of the agreements of RHI
contained herein, and RHI may waive compliance with any of the agreements
of Household or Merger Sub contained herein;

provided, however, that no failure or delay by RHI or Household in exercising
any right hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right hereunder.

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<PAGE>

Section 8.5 Termination Fee. (a) If this Agreement is terminated pursuant to
Section 8.1(e) or (f), then RHI will immediately pay to Household a termination
fee equal to $7,000,000 in cash and the reasonable out-of-pocket expenses (not
to exceed $1,000,000) incurred by Household in connection with this Agreement.

(b) The agreement contained in this Section 8.5 is an integral part of the
Transactions and constitutes liquidated damages in the event of the occurrence
of the circumstances specified in Section 8.5(a) above and not a penalty.

ARTICLE IX

MISCELLANEOUS

Section 9.1 Governing Law. This Agreement and the legal relations among the
parties hereto shall be governed by and construed and enforced in accordance
with the laws of the State of New York, without regard to its principles of
conflicts of law.

Section 9.2 Entire Agreement. This Agreement, including the exhibits and
schedules attached hereto, constitutes the entire agreement among the parties
pertaining to the subject matter hereof and supersedes all prior agreements,
understandings, letters of intent, negotiations and discussions, whether oral
or written, of the parties, including without limitation any discussions,
commitments or agreements between the parties concerning RHI equity issuances
or debt financings, and there are no warranties, representations or other
agreements, express or implied, made to any party by any other party in
connection with the subject matter hereof except as specifically set forth
herein or in the documents delivered pursuant hereto or in connection herewith.

Section 9.3 Modification; Waiver. No supplement, modification, extension,
waiver or termination of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any provision of this
Agreement shall be deemed or shall constitute a waiver of any other provision
hereof (whether or not similar), nor shall such waiver constitute a continuing
waiver unless otherwise expressly provided.

Section 9.4 Notices. All notices, consents, requests, reports, demands or
other communications hereunder (collectively, "Notices") shall be in writing
and may be given personally, by registered mail, fax or by Federal Express (or
other reputable overnight delivery service):

if to Household or Merger Sub, to it at:

Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Attention: John W. Blenke, Esq.
Tel: (847) 564-6150
Fax: (847) 205-7536

with a copy to:

Wilmer, Cutler & Pickering
2445 M Street, N.W.
Washington, D.C. 20037
Attention: Russell J. Bruemmer, Esq.
Tel: (202) 663-6804
Fax: (202) 663-6363

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<PAGE>

if to RHI, to it at:

Renaissance Holdings, Inc.
9400 SW Beaverton-Hillsdale Hwy.
Suite 300
Beaverton, Oregon 97005
Attention: Irving Levin, Chief Executive Officer
Tel: (503) 245-9207
Fax: (503) 293-3023

with a copy to:

Stoel Rives LLP
700 NE Multnomah
Suite 950
Portland, Oregon 97232
Attention: Alan R. Blank, Esq.
Tel: (503) 872-4816
Fax: (503) 230-1907

or to such other address or such other person as the addressee party shall have
last designated by notice to the other party. All Notices shall be deemed to
have been given (i) when delivered personally, (ii) three (3) days after being
sent by registered mail with proper postage prepaid, (iii) upon transmission by
fax and receipt of confirmation of such transmission by the sender's fax
machine, or (iv) one day after being sent by Federal Express (or other
reputable overnight delivery service) with proper postage prepaid.

Section 9.5 Expenses. Whether or not the transactions contemplated by this
Agreement shall be consummated, all fees and expenses incurred by any party
hereto in connection with this Agreement shall, subject to Section 8.5 and
unless Household elects to pay all or a portion of such expenses, be borne by
such party, except that (i) the expenses incurred in connection with printing
and mailing the Proxy Statement shall be by Household, and (ii) the fees paid
to a governmental agency in connection with the filings under the HSR Act shall
be paid by Household.

Section 9.6 Assignment. No party hereto shall have the right, power or
authority to assign or pledge this Agreement or any portion of this Agreement,
or to delegate any duties or obligations arising under this Agreement,
voluntarily, involuntarily, or by operation of law, without the prior written
consent of the other parties hereto.

Section 9.7 No Survival. None of the representations and warranties in this
Agreement or in any document or instrument delivered pursuant to this Agreement
shall survive the Merger or the termination of this Agreement pursuant to
Article VIII.

Section 9.8 Severability. Any provision or part of this Agreement which is
invalid or unenforceable in any situation in any jurisdiction shall, as to such
situation and such jurisdiction, be ineffective only to the extent of such
invalidity and shall not affect the enforceability of the remaining provisions
hereof or the validity or enforceability of any such provision in any other
situation or in any other jurisdiction.

Section 9.9 Successors and Assigns; Third Parties. Subject to and without
waiver of the provisions of Section 9.6, all of the rights, duties, benefits,
liabilities and obligations of the parties shall inure to the benefit of, and
be binding upon, their respective successors, assigns, heirs and legal
representatives. Except as specifically set forth in Section 3.2, 3.3, 3.5,
3.6, 6.16 and 6.17 nothing herein expressed or implied is intended or shall be
construed to confer upon or give to any person or entity, other than the
parties hereto and their successors or permitted assigns, any rights or
remedies under or by reason of this Agreement.

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Section 9.10 Counterparts. This Agreement may be executed in as many
counterparts as may be deemed necessary and convenient, and by the different
parties hereto on separate counterparts each of which, when so executed, shall
be deemed an original, but all such counterparts shall constitute one and the
same instrument.

Section 9.11 Interpretation; References. Any use of masculine, feminine or
neuter pronouns herein shall not be limiting, but shall be construed as
referring to persons of any gender, as the context may require. Any use of the
singular or plural form herein shall not be limiting, but shall be construed as
referring to either the plural or singular, as the context may require.
References to a "Schedule" or an "Exhibit" are, unless otherwise specified, to
a Schedule attached to the Disclosure Letter or an Exhibit attached to this
Agreement, and references to an "Article" or a "Section" are, unless otherwise
specified, to an Article or a Section of this Agreement. The Article and
Section headings of this Agreement are for convenience of reference only and
shall not be deemed to modify, explain, restrict, alter or affect the meaning
or interpretation of any provision hereof.

Section 9.12 Dispute Resolution and Jurisdiction. (a) Each party to this
Agreement shall appoint a Representative to coordinate with the other party the
implementation of this Agreement. If any dispute arises with respect to either
party's performance hereunder, the Representatives shall meet to attempt to
resolve such dispute, either in person or by telephone, within two (2) Business
Days after the written request of either Representative. If the Representatives
are unable to resolve such dispute, the chief executive officer of RHI and the
chief financial officer of Household shall meet, either in person or by
telephone, within ten (10) Business Days after either Representative provides
written notice that the Representatives have been unable to resolve such
dispute. If such officers are unable to resolve such dispute, either party may
submit such dispute to Deloitte and Touche LLP, or another nationally-
recognized accounting firm, if such dispute is solely of a financial nature.

(b) Any disputes arising out of, in connection with or with respect to this
Agreement, the subject matter hereof, the performance or non-performance of any
obligation hereunder, or any of the Transactions contemplated hereby that
cannot be resolved in accordance with subsection (a) hereof, shall be
adjudicated in a state or federal court of competent civil jurisdiction sitting
in the State of New York and nowhere else. Each of the parties hereto hereby
irrevocably submits to the jurisdiction of any such court of the purposes of
any suit, civil action or other proceeding arising out of, in connection with
or with respect to this Agreement, the subject matter hereof, the performance
or non-performance of any obligation hereunder, or any of the transactions
contemplated hereby (each, a "Suit"). To the extent permitted by Law, each of
the parties hereto hereby waives and agrees not to assert by way of motion, as
a defense or otherwise in any such Suit, any claim that it is not subject to
the jurisdiction of the above courts, that such Suit is brought in an
inconvenient forum, that the venue of such Suit is improper or that it is
entitled to a trial by jury.

Section 9.13 Exhibits and Disclosure Letter. All exhibits attached hereto
and the Disclosure Letter are hereby incorporated by reference as though set
out in full herein.

Section 9.14 Attorneys' Fees. In the event that any party hereto brings an
action or proceeding against the other party to enforce or interpret any of the
covenants, conditions, agreements or provisions of this Agreement, the
prevailing party in such action or proceeding shall be entitled to recover all
costs and expenses of such action or proceeding, including, without limitation,
reasonable attorneys' fees, charges, disbursements and the fees and costs of
expert witnesses.

Section 9.15 WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT WAIVES ITS
RESPECTIVE RIGHT TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING OUT OF
THIS AGREEMENT OR ANY DEALINGS BETWEEN ANY OF THE PARTIES HERETO RELATING TO
THE SUBJECT MATTER OF THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO
BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND
THAT RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, CONTRACT CLAIMS, TORT CLAIMS AND ALL OTHER COMMON LAW AND

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<PAGE>

STATUTORY CLAIMS. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR TO ANY
OTHER DOCUMENT OR AGREEMENT RELATING TO THE TRANSACTIONS.

Section 9.16 Further Assurances. Each of the parties shall, without further
consideration, use reasonable efforts to execute and deliver such additional
documents and take such other action as the other parties, or any of them, may
reasonably request to carry out the intent of this Agreement and the
Transactions.

Section 9.17 Negotiation of Agreement. Each of the parties acknowledges that
it has been represented by independent counsel of its choice throughout all
negotiations that have preceded the execution of this Agreement and that it has
executed the same with consent and upon the advice of said independent counsel.
Each party and its counsel cooperated in the drafting and preparation of this
Agreement and the documents referred to herein, and any and all drafts relating
thereto shall be deemed the work product of the parties and may not be
construed against any party by reason of its preparation. Accordingly, any rule
of law or any legal decision that would require interpretation of any
ambiguities in this Agreement against the party that drafted it is of no
application and is hereby expressly waived. The provisions of this Agreement
shall be interpreted in a reasonable manner to effect the intentions of the
parties and this Agreement.

In Witness Whereof, the parties hereto have caused this Agreement to be duly
executed and delivered as of the date first above written.

Household International, Inc.

/s/ S. N. Mehta
By: _________________________________
Name:
Title:

Renaissance Credit Services, Inc.

/s/ S. N. Mehta
By: _________________________________
Name:
Title:

Renaissance Holdings, Inc.

/s/ Irving J. Levin
By: _________________________________
Name:
Title:

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<PAGE>

ANNEX B
November 30, 1999

Board of Directors
Renaissance Holdings, Inc.
9400 S.W. Beaverton-Hillsdale Highway
Beaverton, Oregon 97005

Members of the Board:

You have requested our opinion as to the fairness, from a financial point of
view, to the holders of the outstanding shares of RHI Common Stock (as defined
in the Merger Agreement referred to below (the "Stockholders") of Renaissance
Holdings, Inc. (the "Company") of the consideration to be received by such
Stockholders pursuant to the Agreement and Plan of Merger dated as of November
30, 1999 (the "Merger Agreement") by and among Household International, Inc.
("Household"), Renaissance Credit Services, Inc., a wholly-owned direct
subsidiary of Household ("Merger Sub"), and the Company. We understand that,
pursuant to the terms of and subject to the conditions set forth in the Merger
Agreement, the Company will be merged into Merger Sub (the "Merger") and each
issued and outstanding share of RHI Common Stock (other than as specified in
the Merger Agreement), will be converted into the right to receive (i) that
number of shares of common stock of Household, par value $1.00 per share
("Household Common Stock") equal to a fraction (the "Exchange Ratio"), the
numerator of which will be 5,000,000 and the denominator of which will be the
number of shares of RHI Common Stock outstanding immediately prior to the
Effective Time (as defined in the Merger Agreement) minus the number of
Dissenting Shares (as defined in the Merger Agreement) and (ii) cash in an
amount equal to the difference between (x) $31.456 minus (y) the product of the
Exchange Ratio and the Household Stock Price (as defined in the Merger
Agreement) (items (i) and (ii) together constituting the "Merger
Consideration").

We have acted as financial advisor to the Board of Directors of the Company
in connection with the Merger. In arriving at our opinion, we have examined:
(a) the financial terms of the Merger Agreement; (b) audited historical
financial statements of the Company and of Household for the three years ended
December 31, 1998; (c) the unaudited financial statements of the Company for
the nine months ended September 30, 1999 and of Household for the nine months
ended September 30, 1999; (d) certain internal business, operating and
financial information and forecasts of the Company (the "Forecasts"), prepared
by the senior management of the Company; (e) information regarding publicly
available financial terms of certain recently-completed transactions in the
consumer finance industry: (f) current and historical market prices and trading
volumes of the Household Common Stock; and (g) certain other publicly available
information on the Company and Household. We have also held discussions with
members of the senior management of the Company and Household to discuss the
foregoing, have considered other matters which we have deemed relevant to our
inquiry and have taken into account such accepted financial and investment
banking procedures and considerations as we have deemed relevant.

In rendering our opinion, we have assumed and relied, without independent
verification, upon the accuracy and completeness of all the information
examined by or otherwise reviewed or discussed with us for purposes of this
opinion. We have not made or obtained an independent valuation or appraisal of
the assets or liabilities of the Company or Household. We have been advised by
the management of the Company that the Forecasts examined by us have been
reasonably prepared on bases reflecting the best currently available estimates
and judgments of the management of the Company. We express no opinion with
respect to the Forecasts or the estimates and judgments on which they are
based. Our opinion herein is based upon economic, market, financial and other
conditions existing on, and other information disclosed to us as of, the date
of this letter. It should be understood that, although subsequent developments
may affect this opinion, we do not have any obligation to update, revise or
reaffirm this opinion. We have relied as to all legal matters on advice of
counsel to the Company, and we have assumed that the Merger will be consummated
on the terms described in the Merger Agreement, without any waiver of any
material terms of conditions by the Company.

B-1
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William Blair & Company has been engaged in the investment banking business
since 1935. We continually undertake the valuation of investment securities in
connection with public offerings, private placements, business combinations,
estate and gift tax valuations and similar transactions. We have acted as the
investment banker to the Company in connection with the Merger and will receive
a fee from the Company for our services, a significant portion of which is
contingent upon consummation of the Merger. In addition, the Company has agreed
to indemnify us against certain liabilities arising out of our engagement.

We are expressing no opinion herein as to the price at which the Household
Common Stock will trade at any future time or as to the effect of the Merger on
the trading price of the Household Common Stock. Such trading price may be
affected by a number of factors, including but not limited to: (a) dispositions
of the Household Common Stock by stockholders within a short period of time
after the effective date of the Merger; (b) changes in prevailing interest
rates and other factors which generally influence the price of securities; (c)
changes in the current capital markets; (d) the occurrence of changes in the
financial condition, business, assets, results of operations or prospects of
the Company or of Household or in their market; (e) any necessary actions by or
restrictions of federal, state or other governmental agencies or regulatory
authorities; and (f) timely completion of the Merger on terms and conditions
that are acceptable to all parties at interest. We also express no opinion
regarding the fairness, from a financial point of view, of the Merger for those
holders who acquired shares of RHI Common Stock in consideration of the
cancellation of options as contemplated by Section 6.20 of the Merger
Agreement.

Our investment banking services and our opinion were provided for the use
and benefit of the Board of Directors of the Company in connection with its
consideration of the transaction contemplated by the Merger Agreement. Our
opinion is limited to the fairness, from a financial point of view, of the
Merger Consideration to the Stockholders, and we do not address the merits of
the underlying decision by the Company to engage in the Merger and this opinion
does not constitute a recommendation to any stockholder as to how such
stockholder should vote on the proposed Merger. It is understood that this
letter may not be disclosed or otherwise referred to without our prior written
consent, except that the opinion may be included in its entirety in a proxy
statement mailed to the stockholders by the Company with respect to the Merger.

Based upon and subject to the foregoing, it is our opinion as investment
bankers that, as of the date hereof, the Merger Consideration is fair, from a
financial point of view, to the Stockholders.

Very truly yours,

/s/ William Blair & Company, L.L.C.
-------------------------------------
William Blair & Company, L.L.C.

B-2
<PAGE>

ANNEX C

RENAISSANCE HOLDINGS, INC.

INCENTIVE COMPENSATION PLAN

Purpose

The Board of Directors of Renaissance Holdings, Inc. ("RHI") wishes to
provide special incentives (the "Incentive Amount") under this plan (the
"Plan") to certain individuals ("Participants") to remain in the employ of RHI
or RHI's subsidiaries or affiliates (the "RHI Group"). This Plan is subject to
approval of the shareholders of RHI in a manner satisfying the provisions of
Section 280G(b)(5)(A)(ii) of the Internal Revenue Code of 1986, as amended (the
"Code") and will have no force and effect if such approval is not obtained.

Interpretation

If RHI's shareholders approve the Plan in a manner satisfying Section
280G(b)(5)(A)(ii) of the Code and if RHI merges with Renaissance Credit
Services, Inc., a wholly-owned subsidiary of Household International, Inc. (the
"Merger"), all references to the "RHI Group" shall instead refer to Household
International, Inc. ("Household") and its subsidiaries and affiliates,
including RHI. References to "RHI" shall then continue to refer to RHI or its
merger successor, and references to "Household" shall refer to Household or its
designated subsidiary or affiliate. If the Merger does not occur, references to
"Household" shall be solely to RHI or its designated subsidiary or affiliate.
References to actions taken by "Household's Representative" (as defined below)
before the Merger shall only be binding if the Merger occurs.

Participants

The Participants will consist of employees of RHI and its subsidiaries and
affiliates as of the date of approval of the Plan by the RHI shareholders, and
other persons selected by the RHI Administrator thereafter with the consent of
Household's Representative. RHI expects that the Participants will materially
affect the success of the RHI Group. The RHI Administrator, with the consent of
Household's Representative, will designate target individual allocations for
Participants for a given year no later than 30 days after the beginning of that
year with respect to 90% of the Incentive Amount for that year and will
designate the allocation of the remaining 10% no later than 15 days after the
end of that year.

Incentive Amount

The total Incentive Amount is the sum of the Incentive Amounts paid in each
of the three years of the Plan and is subject to the performance of RHI (or the
successor to its business within the RHI Group, together ("Virtual RHI") with
respect to Average Active Accounts on File, ("Average Active Accounts"), in
each of the calendar years covered by the Plan ("Plan Years"). Subject to the
terms of this Plan and satisfaction of the Threshold rules described under
Performance Threshold and Payout below, RHI (or such other entity as Household
designates) will pay to all eligible Participants the Incentive Amount for that
Plan Year, with each Participant's share as described below under Individual
Incentives.

Performance Threshold

The payout of the Incentive Amount is based upon the Average Active
Threshold Accounts of Virtual RHI. An "Active Account on File" is an Account,
managed by Virtual RHI, that during any given month had activity other than a
system generated fee. "Average Active Accounts on File" for any year in the
Plan is calculated as the sum of the number of Active Accounts on File on the
last system processing day of each of the months of the Plan Year, divided by
twelve.

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<PAGE>

The Incentive Amount paid for a Plan Year is determined by first determining
the number of qualifying accounts for that year. The number of qualifying
accounts ("Qualifying Accounts Number") is equal to (a) the Average Active
Accounts on File for the year less (b) the Expired Overage Accounts (as defined
below) for that year.

If, in any Plan Year, the number of Average Active Accounts originated that
year from a purchase (including the acquisition of one or more portfolios and
the acquisition or merger of a bank or third party with Virtual RHI) is greater
than the number of Average Active Accounts originated from all other sources
(i.e. direct mail, cards-in-branches, internet), then the difference between
the number of Average Active Accounts from purchases and the number of Average
Active Accounts from all other sources shall be termed "Overage Accounts."
Expired Overage Accounts are calculated by first determining the Overage
Average Active Accounts on File for the year. For purposes of this calculation,
the attrition rate for Overage Accounts for any period is the same as for the
portfolio with which it was purchased. The "Expired Overage Accounts" is then
the sum of (a) one-half of the number of Overage Average Active Accounts on
File that have been on file for more than 12 months but less than or equal to
24 months; and (b) the number of Overage Average Active Accounts on File that
have been on file for more than 24 months. If, during a Plan Year, multiple
acquisitions occur, and these acquisitions result in Overage Accounts for the
year, then each acquisition is considered to have contributed a pro-rata share
of the Overage Accounts. Further, each portfolio is considered to be "on file"
on its closing date.

Calendar Year 2000 Incentive Amount

If the Qualifying Accounts Number for Calendar Year 2000 is greater than the
Calendar Year 2000 Annual Active Account Threshold as set forth in Exhibit II
hereto, then the Incentive Amount for Calendar Year 2000 is equal to (a) the
Qualifying Accounts Number less (b) the Calendar Year 2000 Annual Active
Account Threshold as set forth in Exhibit II hereto, divided by (c) the
Incentive Differential as set forth in Exhibit II hereto, multiplied by (d) the
Calendar Year 2000 Gross Annual Payment, subject to reduction as described
below in Individual Incentives.

Incentive Amount ={ [ (a)-(b) ] / (c)} * (d)

In no event may the Incentive Amount for Calendar Year 2000 be greater than
the Calendar Year 2000 Gross Annual Payment, subject to reduction as described
below in Individual Incentives.

If the Qualifying Accounts Number for Calendar Year 2000 is less than the
Calendar Year 2000 Annual Active Account Threshold as set forth in Exhibit II
hereto, then there is no Incentive Amount for the Calendar Year 2000.

Calendar Year 2001 And 2002 Incentive Amount

If, in all previous years, the Gross Annual Payment, subject to reduction as
described below in Individual Incentives, was made in full and if the
Qualifying Accounts Number for the applicable Calendar Year is greater than
that year's Annual Active Account Threshold as set forth in Exhibit II hereto,
then the Incentive Amount for that Calendar Year is equal to (a) the Qualifying
Accounts Number less (b) the applicable Annual Active Account Threshold as set
forth in Exhibit II hereto, divided by (c) the Incentive Differential as set
forth in Exhibit II hereto, multiplied by (d) the Calendar Year Gross Annual
Payment, subject to reduction as described below in Individual Incentives
(provided that in no event under this situation may the Incentive Amount for
the Calendar Year 2001 or 2002 be greater than the Calendar Year Gross Annual
Payment for 2001 or 2002, subject to reduction as described below in Individual
Incentives).

Incentive Amount = {[ (a)-(b) ] / (c)} * (d)

If the Qualifying Accounts Number for the applicable Calendar Year is less
than that Calendar Year's Annual Active Account Threshold as set forth in
Exhibit II hereto, then there is no Incentive Amount for that Calendar Year.

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If, in some or all previous years, the Gross Annual Payment, subject to
reduction as described below in Individual Incentives, was not made in full
but the Qualifying Accounts Number is greater than the Annual Active
Account Threshold as set forth in Exhibit II hereto for the applicable
Calendar Year, then unpaid amounts are available for payment for the 2001
or 2002 Calendar Year and the Incentive Amount is equal to (a) the
Qualifying Accounts Number less (b) the applicable Calendar Year Annual
Active Account Threshold as set forth in Exhibit II hereto, divided by (c)
the Incentive Differential as set forth in Exhibit II hereto, multiplied by
(d) the Calendar Year Maximum Cumulative Payment, subject to reduction as
described below in Individual Incentives, less (e) the cumulative Incentive
Amount paid out in all prior Plan Years.

Incentive Amount = { [ (a)-(b) ] / (c) * (d) }-(e)

If, in all previous years, the Gross Annual Payment was not made but the
Qualifying Accounts Number is less than the Annual Active Account Threshold
as set forth in Exhibit II hereto for the applicable Calendar Year, then
there is no Incentive Amount for that Calendar Year.

Virtual RHI

To assist in measuring the Average Growth, the RHI Group will maintain
records sufficient to measure the number of average active accounts on file
during the calendar years 2000, 2001, and 2002.

Maximum Annual Payment

The Incentive Amount is based on the table below:

Maximum Annual Payment
(before reduction for taxes or reduction Retention and Forfeiture)

<TABLE>
<CAPTION>
Maximum
Gross Annual Cumulative
Payment Payment
------------- -------------
<S> <C> <C>
Calendar Year 2000............................ $ 5.5 million $ 5.5 million
Calendar Year 2001............................ $ 3.0 million $ 8.5 million
Calendar Year 2002............................ $ 3.5 million $12.0 million
------------- -------------
Plan Limit.................................... $12.0 million $12.0 million
</TABLE>

RHI (or another entity designated by Household) will pay up to the Gross
Annual Payment for performance in a particular Plan Year and up to the Maximum
Cumulative Payment for performance in that Plan Year and preceding Plan Years.
Amounts not paid with respect to a particular Plan Year (because, for example,
of forfeitures) are available for payment in the later Plan Years as set forth
above. If the RHI Administrator and Household's Representative agree, amounts
not paid with respect to the Plan Years ending on or before December 31, 2002
may be paid with respect to mutually agreed goals for 2003 (or later years). In
no event is the RHI Group required to pay more under the Plan than the Plan
Limit set forth above.

Individual Incentives

The Participant's share (the "Individual Incentive") will be the percentage
shown on Exhibit I with his or her name (as revised annually), except as the
RHI Administrator otherwise designates (within the maximum and minimum
percentages Household's Representative provides him) and provided that no one
on the initial Exhibit I list may receive more than the maximum individual
incentive shown. Individual Incentives are subject to the requirements under
Retention and Forfeiture below. Except as (a) expressly approved by the
shareholders of RHI in a manner satisfying the provisions of Section
280G(b)(5)(A)(ii) of the Code, (b) as Exhibit I otherwise specifies, or (c) as
Household's Representative otherwise agrees, Individual Incentives for the life
of the Plan for persons employed at RHI or its subsidiaries at the time of the
shareholder vote approving the Plan, will be further capped at 300% of a
Participant's average annual includible compensation (annualized for partial
years) from RHI and its subsidiaries for the years 1995 through 1999 (or, if
employed for fewer years during that period, during the years of employment),
less any adjustments necessary to preserve the RHI Group's deduction for
amounts paid.

C-3
<PAGE>

The percentages shown on Exhibit I reflect maximum payouts. The RHI
Administrator will review individual performance for the particular Plan Year
and, with the consent of Household's Representative (which consent will not be
unreasonably withheld), will determine what percentage of the maximum payout
each individual should actually receive. In no event will Irving Levin receive
one or more Individual Incentives totaling more than $1,320,000 under the Plan.

Time and Manner of Payment

RHI (or such other entity as Household designates) will pay the annual
Individual Incentives, if earned, by January 31 of the year following the end
of the calendar year being measured. Payments will be without interest or other
earnings. RHI will make the payments in cash. All payments will be reduced by
any applicable taxes and other required withholdings. Household or RHI may
delay payment for a Participant who is under review for termination with Cause
pending final determination of job status.

Retention and Forfeiture

To receive an Individual Incentive, except as provided below for
terminations without Cause, a Participant must remain employed by the RHI Group
as of the date of payment. Participants not so employed will forfeit (that is,
lose their claim to receive) their Individual Incentives and any claim with
respect to any Incentive Amount. Amounts forfeited by persons that the RHI
Administrator designates in advance, with the consent of Household's
Representative, as "Key Employees" will be subtracted from that year's and each
following year's Incentive Amount before the Individual Incentives are
calculated. Other forfeitures will remain part of the Incentive Amount and will
be reallocated to the remaining Participants who qualify for such payments in
proportion to their relative shares on Exhibit I; provided, however, that the
RHI Administrator may change the reallocation formula within his discretionary
limits and with the consent of Household's Representative. If the RHI Group
terminates a Participant's employment without Cause, the Participant will
receive a pro rata portion of the Individual Incentive for the year of
employment termination, which proration is based on the percentage of the year
preceding employment termination. Cause, solely for purposes of this Plan,
includes, but is not limited to, the following types of conduct and
circumstances: breach of any material provision of any applicable employment
agreement; material violation of any statutory or common law duty of loyalty to
the RHI Group; conduct or performance that, in RHI's or Household's reasonable
judgement, adversely affects the interests of the RHI Group; or conduct that,
in RHI's or Household's reasonable judgement, creates a conflict of interest
between the Participant and the RHI Group.

Administration and Obligation

RHI (or such other entity as Household designates) is responsible for the
general operation and administration of the Plan and for carrying out the
provisions thereof and has full discretion in interpreting and administering
the provisions of the Plan in a manner consistent with the Plan's intent. The
RHI Administrator for purposes of determining Participants, Key Employees, and
individual allocations under the Plan is Irving Levin or such other person or
committee as Levin designates with Household's permission or, if the Merger is
not consummated, the permission of the Board of Directors of RHI, or as
Household (or the Board of Directors of RHI, if the Merger is not consummated)
designates if Levin leaves employment with the RHI Group for any reason.
Actions by the RHI Administrator require the consent of S.N. Mehta or other
Household Group Executive or such other person or committee as Household
designates ("Household's Representative"), provided that any consents required
before the Merger will have no effect if the Merger does not occur. The Plan
will be unfunded.

Effect on Other Plans

Whether the accrual or payment of the amounts under this Plan causes the
Participant to accrue or receive additional benefits under any pension or other
plan is governed solely by the terms of such other plan.

C-4
<PAGE>

No Transfers

Neither the Participant nor his or her beneficiaries nor anyone claiming an
interest through him or them will have any right to sell, assign, pledge, or
otherwise transfer the right to receive a payment under this Plan. Any rights
to such payments are expressly declared to be nonassignable and
nontransferable. Unless the law requires otherwise, no unpaid amounts will be
subject to attachment, alienation, garnishment, or execution, or be
transferable if the Participant becomes bankrupt or insolvent, for the
satisfaction of the debts of, or other obligations or claims against, the
Participant, his beneficiaries, or any person or entity claiming an interest
through him or them, including claims for alimony, support, or separate
maintenance.

Plan Amendments

For the purpose of correcting clerical errors, causing the Plan to comply
with applicable law or causing the Plan to operate more efficiently and with
less uncertainty, RHI (or, after the Merger, Household), acting through any
officer, may amend the Plan at any time, without the consent of the
Participants or their beneficiaries; provided, however, that no amendment will
deprive any Participant or beneficiary of any previously determined vested
Individual Incentives. If the Merger does not occur, this Plan will
automatically terminate, without payment to anyone actually or potentially
covered by the Plan.

No Employment Contract

Nothing contained in this Plan constitutes an employment contract between
any member of the RHI Group, and any Participant. The Plan does not give any
Participant any right to be retained in any RHI or Household company's employ,
nor does it enlarge or diminish such company's right to terminate the
Participant's employment. References in this Plan to Cause do not mean and
should not be understood to mean that the RHI Group must have Cause to
terminate a Participant's employment, and all Participants remain at-will
employees whose employment may be terminated at any time for any reason,
subject to the terms of any applicable written employment or severance
agreement.

Applicable Law

The laws of the State of Illinois (other than its choice of law provisions)
govern this Plan and its interpretation.

Confidentiality

Participants and their affiliates must hold in confidence any confidential
information concerning Household, RHI, Virtual RHI, and their affiliates
concerning this Plan and the specific terms of participation by individuals and
must not be disclose this information to any third party or use it in any
manner, except as may otherwise be required to maintain compliance with
applicable law.

C-5
<PAGE>

RENAISSANCE HOLDINGS, INC.

INCENTIVE COMPENSATION PLAN

EXHIBIT I, AS AMENDED TO DATE

Participants Initial Percentage for Individual
Incentives

Persons from List Designated as Key Employees

Irving Levin
George Alexander
Charles Engelberg
Karen Frolich

Maximum Individual Incentives

<TABLE>
<CAPTION>
Maximum Percentage Maximum Cumulative
Name of Total Pool Amounts
- ---- ------------------ ------------------
<S> <C> <C>
George Alexander.......................... 7% $840,000
Charles Engelberg......................... 7 840,000
Karen Frolich............................. 7 840,000
Gary Barth................................ 4 480,000
Brian Enneking............................ 4 480,000
Glenda Goodrich........................... 4 480,000
Jay Hemmady............................... 4 480,000
Elaine Howard............................. 4 480,000
Jeanne Muenchau........................... 4 480,000
Kirt Nelson............................... 4 480,000
Lenice Shaw............................... 4 480,000
Karol Anderson............................ 2 240,000
Suresh Baral.............................. 2 240,000
Ramona Cahn............................... 2 240,000
Vernon Fuller............................. 2 240,000
Lisa Funk................................. 2 240,000
Debbie Grabler............................ 2 240,000
David Graham.............................. 2 240,000
John Gross................................ 2 240,000
Doug Hansen............................... 2 240,000
Susie Hoiness............................. 2 240,000
Kathy Kobe................................ 2 240,000
Tim Purcell............................... 2 240,000
Maureen Reding............................ 2 240,000
Kimberly Roberts.......................... 2 240,000
Linda Rutledge............................ 2 240,000
Rebekah Sayers............................ 2 240,000
Nancy Struble............................. 2 240,000
John West................................. 2 240,000
</TABLE>

C-6
<PAGE>

RENAISSANCE HOLDINGS, INC.

INCENTIVE COMPENSATION PLAN

EXHIBIT II

<TABLE>
<CAPTION>
Annual Active Annual Active Annual Incentive
Annual Thresholds (All Account Account Account Differential
Volumes in 000) Threshold (A) Target (B) ( B-A)
------------------------------ ------------- ------------- ----------------
<S> <C> <C> <C>
Calendar Year 2000............... 1,393 1,530 137
Calendar Year 2001............... 2,149 2,475 326
Calendar Year 2002............... 2,709 3,105 396
</TABLE>

C-7
<PAGE>

ANNEX D

1998 OREGON REVISED STATUTES
TITLE 7. CORPORATIONS AND PARTNERSHIPS
CHAPTER 60. PRIVATE CORPORATIONS
DISSENTERS' RIGHTS
(RIGHT TO DISSENT AND OBTAIN PAYMENT FOR SHARES)

60.551. Definitions for 60.551 to 60.594.

As used in ORS 60.551 to 60.594:

(1) "Beneficial shareholder" means the person who is a beneficial owner
of shares held in a voting trust or by a nominee as the record shareholder.

(2) "Corporation" means the issuer of the shares held by a dissenter
before the corporate action, or the surviving or acquiring corporation by
merger or share exchange of that issuer.

(3) "Dissenter" means a shareholder who is entitled to dissent from
corporate action under ORS 60.554 and who exercises that right when and in
the manner required by ORS 60.561 to 60.587.

(4) "Fair value," with respect to a dissenter's shares, means the value
of the shares immediately before the effectuation of the corporate action
to which the dissenter objects, excluding any appreciation or depreciation
in anticipation of the corporate action unless exclusion would be
inequitable.

(5) "Interest" means interest from the effective date of the corporate
action until the date of payment, at the average rate currently paid by the
corporation on its principal bank loans or, if none, at a rate that is fair
and equitable under all the circumstances.

(6) "Record shareholder" means the person in whose name shares are
registered in the records of a corporation or the beneficial owner of
shares to the extent of the rights granted by a nominee certificate on file
with a corporation.

(7) "Shareholder" means the record shareholder or the beneficial
shareholder.

(1987 c. 52 s 124; 1989 c. 1040 s 30)

60.554. Right to dissent.

(1) Subject to subsection (2) of this section, a shareholder is entitled to
dissent from, and obtain payment of the fair value of the shareholder's shares
in the event of, any of the following corporate acts:

(a) Consummation of a plan of merger to which the corporation is a party
if shareholder approval is required for the merger by ORS 60.487 or the
articles of incorporation and the shareholder is entitled to vote on the
merger or if the corporation is a subsidiary that is merged with its parent
under ORS 60.491;

(b) Consummation of a plan of share exchange to which the corporation is
a party as the corporation whose shares will be acquired, if the
shareholder is entitled to vote on the plan;

(c) Consummation of a sale or exchange of all or substantially all of
the property of the corporation other than in the usual and regular course
of business, if the shareholder is entitled to vote on the sale or
exchange, including a sale in dissolution, but not including a sale
pursuant to court order or a sale for cash pursuant to a plan by which all
or substantially all of the net proceeds of the sale will be distributed to
the shareholders within one year after the date of sale;

(d) An amendment of the articles of incorporation that materially and
adversely affects rights in respect of a dissenter's shares because it:

(A) Alters or abolishes a preemptive right of the holder of the
shares to acquire shares or other securities; or

(B) Reduces the number of shares owned by the shareholder to a
fraction of a share if the fractional share so created is to be
acquired for cash under ORS 60.141; or

D-1
<PAGE>

(e) Any corporate action taken pursuant to a shareholder vote to the
extent the articles of incorporation, bylaws or a resolution of the board
of directors provides that voting or nonvoting shareholders are entitled to
dissent and obtain payment for their shares.

(2) A shareholder entitled to dissent and obtain payment for the
shareholder's shares under ORS 60.551 to 60.594 may not challenge the corporate
action creating the shareholder's entitlement unless the action is unlawful or
fraudulent with respect to the shareholder or the corporation.

(3) Dissenters' rights shall not apply to the holders of shares of any class
or series if the shares of the class or series were registered on a national
securities exchange or quoted on the National Association of Securities
Dealers, Inc. Automated Quotation System as a National Market System issue on
the record date for the meeting of shareholders at which the corporate action
described in subsection (1) of this section is to be approved or on the date a
copy or summary of the plan of merger is mailed to shareholders under ORS
60.491, unless the articles of incorporation otherwise provide.

(1987 c. 52 s 125; 1989 c. 1040 s 31; 1993 c. 403 s 9)

60.557. Dissent by nominees and beneficial owners.

(1) A record shareholder may assert dissenters' rights as to fewer than all
the shares registered in the shareholder's name only if the shareholder
dissents with respect to all shares beneficially owned by any one person and
notifies the corporation in writing of the name and address of each person on
whose behalf the shareholder asserts dissenters' rights. The rights of a
partial dissenter under this subsection are determined as if the shares
regarding which the shareholder dissents and the shareholder's other shares
were registered in the names of different shareholders.

(2) A beneficial shareholder may assert dissenters' rights as to shares held
on the beneficial shareholder's behalf only if:

(a) The beneficial shareholder submits to the corporation the record
shareholder's written consent to the dissent not later than the time the
beneficial shareholder asserts dissenters' rights; and

(b) The beneficial shareholder does so with respect to all shares of
which such shareholder is the beneficial shareholder or over which such
shareholder has power to direct the vote.

(1987 c. 52 s 126)

60.561. Notice of dissenters' rights.

(1) If proposed corporate action creating dissenters' rights under ORS
60.554 is submitted to a vote at a shareholders' meeting, the meeting notice
must state that shareholders are or may be entitled to assert dissenters'
rights under ORS 60.551 to 60.594 and be accompanied by a copy of ORS 60.551 to
60.594.

(2) If corporate action creating dissenters' rights under ORS 60.554 is
taken without a vote of shareholders, the corporation shall notify in writing
all shareholders entitled to assert dissenters' rights that the action was
taken and send the shareholders entitled to assert dissenters' rights the
dissenters' notice described in ORS 60.567.

(1987 c. 52 s 127)

60.564. Notice of intent to demand payment.

(1) If proposed corporate action creating dissenters' rights under ORS
60.554 is submitted to a vote at a shareholders' meeting, a shareholder who
wishes to assert dissenters' rights shall deliver to the corporation before the
vote is taken written notice of the shareholder's intent to demand payment for
the shareholder's shares if the proposed action is effectuated and shall not
vote such shares in favor of the proposed action.

D-2
<PAGE>

(2) A shareholder who does not satisfy the requirements of subsection (1) of
this section is not entitled to payment for the shareholder's shares under this
chapter.

(1987 c. 52 s 128)

60.567. Dissenters' notice.

(1) If proposed corporate action creating dissenters' rights under ORS
60.554 is authorized at a shareholders' meeting, the corporation shall deliver
a written dissenters' notice to all shareholders who satisfied the requirements
of ORS 60.564.

(2) The dissenters' notice shall be sent no later than 10 days after the
corporate action was taken, and shall:

(a) State where the payment demand shall be sent and where and when
certificates for certificated shares shall be deposited;

(b) Inform holders of uncertificated shares to what extent transfer of
the shares will be restricted after the payment demand is received;

(c) Supply a form for demanding payment that includes the date of the
first announcement of the terms of the proposed corporate action to news
media or to shareholders and requires that the person asserting dissenters'
rights certify whether or not the person acquired beneficial ownership of
the shares before that date;

(d) Set a date by which the corporation must receive the payment demand.
This date may not be fewer than 30 nor more than 60 days after the date the
subsection (1) of this section notice is delivered; and

(e) Be accompanied by a copy of ORS 60.551 to 60.594.

(1987 c. 52 s 129)

60.571. Duty to demand payment.

(1) A shareholder sent a dissenters' notice described in ORS 60.567 must
demand payment, certify whether the shareholder acquired beneficial ownership
of the shares before the date required to be set forth in the dissenters'
notice pursuant to ORS 60.567 (2)(c), and deposit the shareholder's
certificates in accordance with the terms of the notice.

(2) The shareholder who demands payment and deposits the shareholder's
shares under subsection (1) of this section retains all other rights of a
shareholder until these rights are canceled or modified by the taking of the
proposed corporate action.

(3) A shareholder who does not demand payment or deposit the shareholder's
share certificates where required, each by the date set in the dissenters'
notice, is not entitled to payment for the shareholder's shares under this
chapter.

(1987 c. 52 s 130)

60.574. Share restrictions.

(1) The corporation may restrict the transfer of uncertificated shares from
the date the demand for their payment is received until the proposed corporate
action is taken or the restrictions released under ORS 60.581.

(2) The person for whom dissenters' rights are asserted as to uncertificated
shares retains all other rights of a shareholder until these rights are
canceled or modified by the taking of the proposed corporate action.

(1987 c. 52 s 131)

60.577. Payment.

D-3
<PAGE>

(1) Except as provided in ORS 60.584, as soon as the proposed corporate
action is taken, or upon receipt of a payment demand, the corporation shall pay
each dissenter who complied with ORS 60.571, the amount the corporation
estimates to be the fair value of the shareholder's shares, plus accrued
interest.

(2) The payment must be accompanied by:

(a) The corporation's balance sheet as of the end of a fiscal year
ending not more than 16 months before the date of payment, an income
statement for that year and the latest available interim financial
statements, if any;

(b) A statement of the corporation's estimate of the fair value of the
shares;

(d) A statement of the dissenter's right to demand payment under ORS
60.587; and

(e) A copy of ORS 60.551 to 60.594.

(1987 c. 52 s 132; 1987 c. 579 s 4)

60.581. Failure to take action.

(1) If the corporation does not take the proposed action within 60 days
after the date set for demanding payment and depositing share certificates, the
corporation shall return the deposited certificates and release the transfer
restrictions imposed on uncertificated shares.

(2) If after returning deposited certificates and releasing transfer
restrictions, the corporation takes the proposed action, it must send a new
dissenters' notice under ORS 60.567 and repeat the payment demand procedure.

(1987 c. 52 s 133)

60.584. After-acquired shares.

(1) A corporation may elect to withhold payment required by ORS 60.577 from
a dissenter unless the dissenter was the beneficial owner of the shares before
the date set forth in the dissenters' notice as the date of the first
announcement to news media or to shareholders of the terms of the proposed
corporate action.

(2) To the extent the corporation elects to withhold payment under
subsection (1) of this section, after taking the proposed corporate action, it
shall estimate the fair value of the shares plus accrued interest and shall pay
this amount to each dissenter who agrees to accept it in full satisfaction of
such demand. The corporation shall send with its offer a statement of its
estimate of the fair value of the shares an explanation of how the interest was
calculated and a statement of the dissenter's right to demand payment under ORS
60.587.

(1987 c. 52 s 134)

60.587. Procedure if shareholder dissatisfied with payment or offer.

(1) A dissenter may notify the corporation in writing of the dissenter's own
estimate of the fair value of the dissenter's shares and amount of interest
due, and demand payment of the dissenter's estimate, less any payment under ORS
60.577 or reject the corporation's offer under ORS 60.584 and demand payment of
the dissenter's estimate of the fair value of the dissenter's shares and
interest due, if:

(a) The dissenter believes that the amount paid under ORS 60.577 or
offered under ORS 60.584 is less than the fair value of the dissenter's
shares or that the interest due is incorrectly calculated;

(b) The corporation fails to make payment under ORS 60.577 within 60
days after the date set for demanding payment; or

(c) The corporation, having failed to take the proposed action, does not
return the deposited certificates or release the transfer restrictions
imposed on uncertificated shares within 60 days after the date set for
demanding payment.

D-4
<PAGE>

(2) A dissenter waives the right to demand payment under this section unless
the dissenter notifies the corporation of the dissenter's demand in writing
under subsection (1) of this section within 30 days after the corporation made
or offered payment for the dissenter's shares.

(1987 c. 52 s 135)

60.591. Court action.

(1) If a demand for payment under ORS 60.587 remains unsettled, the
corporation shall commence a proceeding within 60 days after receiving the
payment demand under ORS 60.587 and petition the court under subsection (2) of
this section to determine the fair value of the shares and accrued interest. If
the corporation does not commence the proceeding within the 60-day period, it
shall pay each dissenter whose demand remains unsettled the amount demanded.

(2) The corporation shall commence the proceeding in the circuit court of
the county where a corporation's principal office is located, or if the
principal office is not in this state, where the corporation's registered
office is located. If the corporation is a foreign corporation without a
registered office in this state, it shall commence the proceeding in the county
in this state where the registered office of the domestic corporation merged
with or whose shares were acquired by the foreign corporation was located.

(3) The corporation shall make all dissenters, whether or not residents of
this state, whose demands remain unsettled parties to the proceeding as in an
action against their shares. All parties must be served with a copy of the
petition. Nonresidents may be served by registered or certified mail or by
publication as provided by law.

(4) The jurisdiction of the circuit court in which the proceeding is
commenced under subsection (2) of this section is plenary and exclusive. The
court may appoint one or more persons as appraisers to receive evidence and
recommend decision on the question of fair value. The appraisers have the
powers described in the court order appointing them, or in any amendment to the
order. The dissenters are entitled to the same discovery rights as parties in
other civil proceedings.

(5) Each dissenter made a party to the proceeding is entitled to judgment
for:

(a) The amount, if any, by which the court finds the fair value of the
dissenter's shares, plus interest, exceeds the amount paid by the
corporation; or

(b) The fair value, plus accrued interest, of the dissenter's after-
acquired shares for which the corporation elected to withhold payment under
ORS 60.584.

(1987 c. 52 s 136)

60.594. Court costs and counsel fees.

(1) The court in an appraisal proceeding commenced under ORS 60.591 shall
determine all costs of the proceeding, including the reasonable compensation
and expenses of appraisers appointed by the court. The court shall assess the
costs against the corporation, except that the court may assess costs against
all or some of the dissenters, in amounts the court finds equitable, to the
extent the court finds the dissenters acted arbitrarily, vexatiously, or not in
good faith in demanding payment under ORS 60.587.

(2) The court may also assess the fees and expenses of counsel and experts
of the respective parties in amounts the court finds equitable:

(a) Against the corporation and in favor of any or all dissenters if the
court finds the corporation did not substantially comply with the
requirements of ORS 60.561 to 60.587; or

(b) Against either the corporation or a dissenter, in favor of any other
party, if the court finds that the party against whom the fees and expenses
are assessed acted arbitrarily, vexatiously or not in good faith with
respect to the rights provided by this chapter.

D-5
<PAGE>

(3) If the court finds that the services of counsel for any dissenter were
of substantial benefit to other dissenters similarly situated, and that the
fees for those services should not be assessed against the corporation, the
court may award to counsel reasonable fees to be paid out of the amount awarded
the dissenters who were benefited.

(1987 c. 52 s 137)

SECTION 15. ORS 60.554 is amended to read:

60.554. (1) Subject to subsection (2) of this section, a shareholder is
entitled to dissent from, and obtain payment of the fair value of the
shareholder's shares in the event of, any of the following corporate acts:

(a) Consummation of a plan of merger to which the corporation is a
party if shareholder approval is required for the merger by ORS 60.487
or the articles of incorporation and the shareholder is entitled to
vote on the merger or if the corporation is a subsidiary that is merged
with its parent under ORS 60.491;

(b) Consummation of a plan of share exchange to which the
corporation is a party as the corporation whose shares will be
acquired, if the shareholder is entitled to vote on the plan;

(c) Consummation of a sale or exchange of all or substantially all
of the property of the corporation other than in the usual and regular
course of business, if the shareholder is entitled to vote on the sale
or exchange, including a sale in dissolution, but not including a sale
pursuant to court order or a sale for cash pursuant to a plan by which
all or substantially all of the net proceeds of the sale will be
distributed to the shareholders within one year after the date of sale;

(d) An amendment of the articles of incorporation that materially
and adversely affects rights in respect of a dissenter's shares because
it:

(A) Alters or abolishes a preemptive right of the holder of the
shares to acquire shares or other securities; or

(B) Reduces the number of shares owned by the shareholder to a
fraction of a share if the fractional share so created is to be
acquired for cash under ORS 60.141; [or]

(e) Any corporate action taken pursuant to a shareholder vote to the
extent the articles of incorporation, bylaws or a resolution of the
board of directors provides that voting or nonvoting shareholders are
entitled to dissent and obtain payment for their shares; or

(f) Conversion to a noncorporate business entity pursuant to section
7 of this 1999 Act.

(3) Dissenters' rights shall not apply to the holders of shares of any class
or series of the shares of the class or series were registered on a national
securities exchange or quoted on the National Association of Securities
Dealers, Inc. Automated Quotation System as a National Market System issue on
the record date for the meeting of shareholders at which the corporate action
described in subsection (1) of this section is to be approved or on the date a
copy or summary of the plan of merger is mailed to shareholders under ORS
60.491, unless the articles of incorporation otherwise provide.

D-6
<PAGE>

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20. Indemnification of Directors and Officers.

The General Corporation Law of the state of Delaware (Section 102) allows a
corporation to eliminate the personal liability of directors of a corporation
to the corporation or to any of its stockholders for monetary damage for a
breach of his/her fiduciary duty as a director, except in the case where the
director breached his/her duty of loyalty, failed to act in good faith, engaged
in intentional misconduct or knowingly violated a law, authorized the payment
of a dividend or approved a stock repurchase in violation of Delaware corporate
law or obtained an improper personal benefit. The Restated Certificate of
Incorporation, as amended, of Household International, Inc. ("Household
International"), contains a provision which eliminates directors' personal
liability as set forth above.

The General Corporation Law of the state of Delaware (Section 145) gives
Delaware corporations broad powers to indemnify their present and former
directors and officers and those of affiliated corporations against expenses
incurred in the defense of any lawsuit to which they are made parties by reason
of being or having been such directors or officers, subject to specified
conditions and exclusions; gives a director or officer who successfully defends
an action the right to be so indemnified; and authorizes the corporation 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 the state 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). 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.

Household International, as permitted by the General Corporation Law of the
State of Delaware, has purchased liability policies which indemnify its
officers and directors against loss arising from claims by reason of their
legal liability for acts as officers or directors subject to limitations and
conditions as set forth in the policies.

II-1
<PAGE>

Item 21. Exhibits and Financial Statement Schedules.

<TABLE>
<CAPTION>
2.1 Agreement and Plan of Merger dated as of November 30, 1999
between Renaissance Credit Services, Inc., Renaissance
Holdings, Inc. and Household International, Inc. included
as Annex A to the Prospectus and Proxy Statement.
<C> <S> <C>
5* Opinion and Consent of Mr. John W. Blenke, Vice
President--Corporate Law and Assistant Secretary of
Household International, Inc.
8* Opinion and Consent of Wilmer, Cutler & Pickering, re: tax
matters.
10.1* GECC Stockholder Agreement dated as of November 30, 1999
among Household International, Inc., Renaissance Holdings,
Inc. and General Electric Capital Corporation.
10.2* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and Noel C. Nelson.
10.3* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and Karen D. Frolich and Fritz H. Frolich.
10.4* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and George F. Alexander and Sharon C.
Alexander.
10.5* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc. and Charles Engelberg.
10.6* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.
and Irving J. Levin.
10.7* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and Martin Mitchell and Virginia Mitchell.
10.8* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and Ruth Scherbarth.
10.9* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin and Neil Goldschmidt.
10.10* Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holdings, Inc.,
Irving J. Levin, and Patricia L. Reesman and The Patricia
L. Reesman Family Limited Partnership, L.L.P.
10.11 Stockholder Agreement dated as of November 30, 1999 among
Household International, Inc., Renaissance Holding, Inc.,
Irving J. Levin and William R. Reesman.
10.12(a) Executive Compensation and Benefits Agreement dated August
5, 1999 between George F. Alexander and Renaissance
Holdings, Inc.
10.12(b) Amendment and Continuation of Executive Compensation and
Benefits Agreement dated December 1, 1999 among George F.
Alexander, Renaissance Holdings, Inc. and Household
International, Inc. and Household International, Inc.
10.13(a) Executive Compensation and Benefits Agreement dated August
5, 1999 between Charles B. Engelberg and Renaissance
Holdings, Inc.
<CAPTION>
10.13(b) Amendment and Continuation of Executive Compensation and
Benefits Agreement dated December 1, 1999 among Charles B.
Engelberg, Renaissance Holdings, Inc. and Household
International, Inc.
10.14(a) Executive Compensation and Benefits Agreement dated August
16, 1999 between Karen D. Frolich and Renaissance
Holdings, Inc.
</TABLE>

II-2
<PAGE>

<TABLE>
<S> <C>
10.14(b) Amendment and Continuation of Executive Compensation and Benefits Agreement
dated December 1, 1999 among Karen D. Frolich, Renaissance Holdings, Inc.
and Household International, Inc.
10.15 Employment Agreement dated December 1, 1999 between Household International,
Inc. and Irving J. Levin.
10.16 Non-Competition Agreement dated December 1, 1999 between Household
International, Inc. and Irving J. Levin.
10.17 Non-Competition Agreement dated December 1, 1999 between Household
International, Inc. and Charles B. Engelberg.
10.18 Non-Competition Agreement dated December 1, 1999 between Household
International, Inc. and Karen D. Frolich.
10.19 Non-Competition Agreement dated December 1, 1999 between Household
International, Inc. and George F. Alexander.
23.1* Consent of Arthur Andersen LLP, Certified Public Accountants, relating to
the audited financial information of Household International, Inc.
23.2 Consent of KPMG LLP, Certified Public Accountants, relating to the audited
financial information of Renaissance Holdings, Inc.
23.3* Consent of Mr. John W. Blenke, Vice President--Corporate Law and Assistant
Secretary of Household International, Inc. is contained in his opinion.
23.4* Consent of Wilmer, Cutler & Pickering is contained in their opinion.
23.5 Consent of William Blair & Company, L.L.C. relating to fairness opinion.
24* Powers of Attorney.
99* Form of Proxy to be used by Renaissance Holdings, Inc.
</TABLE>
- --------
* Previously filed.

Item 22. Undertakings.

Household International, Inc. (the "Registrant") hereby undertakes:

(1) 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 (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to 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.

(2) To deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual report to
security holders that is incorporated by reference in the prospectus and
furnished pursuant to and meeting the requirements of Rule 14a-3 or Rule
14c-3 under the Securities Exchange Act of 1934; and, where interim
financial information required to be presented by Article 3 of Regulation
S-X is not set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the prospectus is sent or given, the
latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.

(3) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within
the meaning of Rule 145(c), the issuer undertakes that such reoffering
prospectus will contain the information called for by the applicable
registration form with respect to reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other Items
of the applicable form.

II-3
<PAGE>

(4) That every prospectus that is filed pursuant to paragraph (3)
above, or that purports to meet the requirements of section 10(a)(3) of the
Securities Act of 1933 and is used in connection with an offering of
securities subject to Rule 415 ((S)230.415 of this chapter), will be filed
as a part of an amendment to the registration statement and will not be
used until such amendment is effective, and that, for purposes 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 therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.

(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in
the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of
such issue.

(6) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
Form S-4, within one business day of receipt of such request, and to send
the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to
the effective date of the registration statement through the date of
responding to the request.

(7) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein,
that was not the subject of and included in the registration statement when
it became effective.

II-4
<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned thereunto duly authorized in the City of Prospect Heights, and
State of Illinois, on the 28th day of December, 1999.

Household International, Inc.

*
By___________________________________
William F. Aldinger
Chairman and Chief Executive
Officer

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated and on the 28th day of December, 1999.

<TABLE>
<CAPTION>
Signature Title
--------- -----

<S> <C>
* Chairman, Chief Executive Officer and
___________________________________________ Director (as Principal Executive Officer)
(William F. Aldinger)

* Director
___________________________________________
(Robert J. Darnall)

* Director
___________________________________________
(Gary G. Dillon)

* Director
___________________________________________
(John A. Edwardson)

* Director
___________________________________________
(Mary J. Evans)

* Director
___________________________________________
(David J. Farris)

Director
___________________________________________
(Dudley Fishburn)

* Director
___________________________________________
(Cyrus F. Freidheim, Jr.)

* Director
___________________________________________
(James H. Gilliam, Jr.)

* Director
___________________________________________
(Louis E. Levy)

* Director
___________________________________________
(George A. Lorch)
</TABLE>

II-5
<PAGE>

<TABLE>
<S> <C>
* Director
___________________________________________
(John D. Nichols)

* Director
___________________________________________
(James B. Pitblado)

* Director
___________________________________________
(S. Jay Stewart)

* Director
___________________________________________
(Louis W. Sullivan, M.D.)

* Executive Vice President--Chief Financial
___________________________________________ Officer (as Principal Accounting and
(David A. Schoenholz) Financial Officer)

/s/ Laurie S. Mattenson
*By: ______________________________________
(Laurie S. Mattenson)
Attorney-in-fact
</TABLE>

II-6

<PAGE>

EXHIBIT 10.11

STOCKHOLDER AGREEMENT
---------------------

STOCKHOLDER AGREEMENT dated as of November 30, 1999 (this "Agreement"),
among HOUSEHOLD INTERNATIONAL, INC., a Delaware corporation ("Household"),
RENAISSANCE HOLDINGS, INC., an Oregon corporation ("RHI"), Irving J. Levin
("Principal"), and the party who is a signatory hereto ("Stockholder").

WHEREAS, Stockholder desires that RHI, Household and RENAISSANCE CREDIT
SERVICES, INC., a Delaware corporation and a wholly-owned subsidiary of
Household ("Sub"), enter into an Agreement and Plan of Merger dated as of the
date hereof in the form of Exhibit A hereto (as the same may be amended or
supplemented, the "Merger Agreement"), pursuant to which it is intended that
RHI merge with and into the Sub (the "Merger");

WHEREAS, Stockholder is a signatory to the Transfer Restriction Agreement
dated as of June 10, 1997 (the "Transfer Agreement") by and among RHI, the
Principal, General Electric Capital Corporation ("GECC") and certain other
shareholders of RHI ("Restricted Shareholders");

WHEREAS, other Restricted Shareholders, except for GECC, have agreed to
enter into an agreement substantially similar to this Agreement (the
"Stockholder Agreement");

WHEREAS, GECC has agreed to enter into an agreement substantially similar
to this Agreement (the "GECC Stockholder Agreement"), and has agreed, among
other things, to the execution and delivery of this Agreement by Stockholder;

WHEREAS, as of the date hereof, Stockholder is the beneficial owner of, and
has the right to vote and dispose of the number of shares of RHI common stock,
par value $.01 per share ("RHI Common Stock") which is set forth opposite such
Stockholder's name in Schedule A hereto; and

WHEREAS, Stockholder, Principal and RHI are executing this Agreement as an
inducement to Household and Sub to enter into and execute the Merger Agreement;

NOW, THEREFORE, in consideration of the execution and delivery by Household
and Sub of the Merger Agreement and the covenants, conditions and agreements
contained herein and therein, the parties agree as follows:

Section 1. General Representations, Warranties and Covenants. Stockholder
represents, warrants and covenants to RHI, Principal and Household, as of the
date of this Agreement and the Effective Time, as follows:

(a) Stockholder is the record and beneficial owner of the number of
shares of RHI Common Stock set forth opposite such Stockholder's name in
Schedule A hereto, as such Schedule is amended or modified pursuant to
Section 5 hereof (the "Stockholder's Shares" or such "Shares"). Except
for the Stockholder's Shares, Stockholder is not the

Stockholder Agreement of William Reesman Page 1
<PAGE>

record or beneficial owner of any other shares of RHI Common Stock and,
except as set forth in Schedule B hereto, does not own, or have the right
to acquire, any option, warrant or other right to subscribe for, purchase
or otherwise acquire any shares of RHI Common Stock or any security
convertible into shares of RHI Common Stock ("Options").

(b) This Agreement has been duly authorized, executed and delivered by
the Stockholder and, assuming due execution and delivery of this Agreement
by the other parties hereto, shall constitute the legal, valid and binding
obligation of the Stockholder, enforceable against the Stockholder in
accordance with its terms, except as enforceability may be limited by
bankruptcy and other similar laws and general principles of equity. Other
than the Transfer Agreement, neither the execution and delivery of this
Agreement nor the consummation by the Stockholder of the transactions
contemplated hereby will result in a violation of, or a default under, or
conflict with, any contract, trust, commitment, agreement, understanding,
arrangement or restriction of any kind to which the Stockholder is a party
or bound or to which the Stockholder's Shares or any Options are subject.
No trust of which the Stockholder is a trustee requires the consent of any
beneficiary to the execution and delivery of this Agreement or to the
consummation of the transactions contemplated hereby. If the Stockholder
is married and the Stockholder's Shares or Options constitute community
property, this Agreement has been duly authorized, executed and delivered
by, and constitutes a valid and binding agreement of, the Stockholder's
spouse, enforceable against such person in accordance with its terms,
except as enforceability may be limited by bankruptcy and other similar
laws and general principles of equity. Execution and delivery of the
Agreement by the Stockholder and performance of the transactions
contemplated hereby will not violate, or require any consent, approval or
notice under any provision of any judgment, order, decree, statute, law,
rule or regulation applicable to the Stockholder, the Stockholder's Shares
or Options.

(c) The Stockholder's Shares and the certificates representing such
Shares are now and at all times during the term hereof will be held by the
Stockholder, or by a nominee or custodian for the benefit of the
Stockholder, free and clear of all liens, claims, security interests,
proxies, voting trusts or agreements, understandings or arrangements or any
other encumbrances whatsoever, except for any such encumbrances or proxies
arising hereunder or under the Transfer Agreement.

(d) No broker, investment banker, financial adviser or other person is
entitled to any broker's, finder's, financial adviser's or other similar
fee or commission in connection with the transactions contemplated hereby
based upon arrangements made by or on behalf of the Stockholder.

(e) The Stockholder understands and acknowledges that Household and
Sub are entering into the Merger Agreement in reliance upon the
Stockholder's execution and delivery of this Agreement. In connection with
the Merger, the Merger Agreement or any transaction contemplated in
connection therewith, (i) effective as of the Effective Time, Stockholder
hereby terminates and cancels the Transfer Agreement, without any cost or
expense to RHI, GECC, Principal, Household, Sub, any Restricted Shareholder
or the

Stockholder Agreement of William Reesman Page 2
<PAGE>

Surviving Corporation and (ii) pending such termination and cancellation,
Stockholder shall not enforce any provision of the Transfer Agreement
against any of the foregoing parties.

Household represents, warrants and covenants to RHI, Stockholder and Principal,
as of the date of this Agreement and the Effective Time, as follows:

(aa) This Agreement and the Merger Agreement have been duly and
validly executed and delivered by Household and Sub, as applicable, and
assuming due execution and delivery of this Agreement by the other parties
thereto, shall constitute the legal, valid and binding obligation of
Household and Sub, as applicable, enforceable in accordance with their
terms, except as enforceability may be limited by bankruptcy and other
similar laws and general principles of equity. Neither the execution and
delivery of this Agreement or the Merger Agreement nor the consummation of
the Merger or the transactions contemplated hereby will result in the
violation of, or a default under, or conflict with, any contract, trust,
commitment, agreement, understanding, arrangement or restriction of any
kind to which Household or Sub is a party or bound. Execution and delivery
by Household and Sub of this Agreement and the Merger Agreement and
performance of the transactions contemplated thereby will not violate or
require any consent, approval or notice under any provision of any
judgment, order, decree, statute, law, rule or regulation applicable to
Household or Sub, except for (i) applicable requirements, if any, of the
OTS, the OCC, the Exchange Act, the Securities Act, the Blue Sky Laws and
the HSR Act, in each case, including rules and regulations promulgated
thereunder and (ii) the Merger Filing.

(bb) Household and Sub understand and acknowledge that each of the
Stockholder, RHI and Principal is entering into this Agreement in reliance
upon the covenant and agreement of Household and Sub to perform their
respective covenants and obligations under this Agreement and the Merger
Agreement in accordance with its terms. Household and Sub hereby covenant
to Stockholder, RHI and Principal to perform their respective covenants and
obligations under the Merger Agreement in accordance with its terms.

(cc) A true and correct copy of each of the Merger Agreement, the
Stockholder Agreement with each other Restricted Shareholder and the GECC
Stockholder Agreement is attached hereto as Exhibits A through J,
respectively.

RHI represents, warrants and covenants to Stockholder, Household, Sub and
Principal, as of the date of this Agreement and the Effective Time, as follows:

(aaa) This Agreement and the Merger Agreement have been duly and
validly executed and delivered by RHI, and assuming due execution and
delivery by the other parties thereto, each shall constitute the legal,
valid and binding obligation of RHI enforceable in accordance with their
terms, except as enforceability may be limited by bankruptcy and other
similar laws and general principles of equity. Other than the

Stockholder Agreement of William Reesman Page 3
<PAGE>

Transfer Agreement, neither the execution and delivery of this Agreement or
the Merger Agreement nor the consummation of the Merger and the
transactions contemplated hereby will result in the violation of, or a
default under, or conflict with, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind to which
RHI is a party or bound. Execution and delivery by RHI of this Agreement
and the Merger Agreement and performance of the transactions contemplated
thereby will not violate or require any consent, approval or notice under
any provision of any judgment, order, decree, statute, law, rule or
regulation applicable to RHI, except for (i) applicable requirements, if
any, of the OTS, the OCC and the HSR Act, in each case, including rules and
regulations promulgated thereunder and (ii) the Merger Filing.

(bbb) RHI understands and acknowledges that each of Household,
Principal and Stockholder is entering into this Agreement in reliance upon
the covenant and agreement of RHI to perform its covenants and obligations
under the Merger Agreement and this Agreement in accordance with their
terms. RHI hereby covenants to each of Household, Principal and
Stockholder to perform its covenants and obligations under the Merger
Agreement and this Agreement in accordance with their terms. In connection
with the Merger, the Merger Agreement or any transaction contemplated in
connection therewith, RHI hereby terminates and cancels, as of the
Effective Time, the Transfer Agreement, without any cost or expense to
Household, Stockholder, Sub, any Restricted Shareholder, Surviving
Corporation or the Principal and shall not enforce any provision of the
foregoing agreements against such parties. RHI has received, effective as
of the Effective Time, the consent of GECC, Principal and a majority of the
shares held by Restricted Shareholders to the termination of the Transfer
Agreement and all of the restrictions on transfers set forth therein.

Principal represents, warrants and covenants to Stockholder, Household and RHI,
as of the date of this Agreement and the Effective Time, as follows:

(aaaa) This Agreement has been duly and validly executed and
delivered by Principal, and assuming due execution and delivery of this
Agreement by the other parties hereto, shall constitute the legal, valid
and binding obligation of Principal enforceable in accordance with its
terms, except as enforceability may be limited by bankruptcy and other
similar laws and general principles of equity. Other than the Transfer
Agreement, neither the execution and delivery of this Agreement nor the
consummation of the Merger and the transactions contemplated hereby will
result in the violation of, or a default under, or conflict with, any
contract, trust, commitment, agreement, understanding, arrangement or
restriction of any kind to which Principal is a party or bound. No trust
of which the Principal is a trustee requires the consent of any beneficiary
to the execution and delivery of this Agreement or to the transactions
contemplated hereby. Execution and delivery by Principal of this Agreement
and performance of the transactions contemplated hereby will not violate or
require any consent, approval or notice under any provision of any
judgment, order, decree, statute, law, rule or regulation applicable to
Principal.

Stockholder Agreement of William Reesman Page 4
<PAGE>

(bbbb) Principal understands and acknowledges that each of RHI,
Household and Sub is entering the Merger Agreement, and Stockholder is
entering into this Agreement in reliance upon the covenant and agreement of
Principal to perform his covenants and obligations under the Agreement in
accordance with its terms. Principal hereby covenants to each of RHI,
Household, Sub and Stockholder to perform his covenants and obligations
under the Agreement in accordance with its terms. In connection with the
Merger, the Merger Agreement or any transaction contemplated in connection
therewith, Principal hereby terminates and cancels, as of the Effective
Time, the Transfer Agreement, without any cost or expense to Household,
RHI, any Restricted Shareholder, Sub or the Surviving Corporation and shall
not enforce any provision thereof against such parties.

Section 2. The Merger. Stockholder hereby agrees to (i) vote his or her
Shares in favor of the Merger and the Merger Agreement at the RHI Meeting, and
any adjournment or postponement thereof and (ii) deliver his or her Shares to
Household pursuant to the terms of the Merger Agreement. Further, Stockholder
hereby agrees that he or she will not exercise any dissenters' rights or rights
of appraisal that he or she may have with respect to the Merger.

Section 3. Specific Stockholder Covenants. Stockholder agrees with and
covenants to Household:

(a) Stockholder shall not, except as contemplated by the terms of this
Agreement or the Merger Agreement, (i) transfer (which terms shall include,
without limitation, for the purposes of this Agreement, any sale, gift,
pledge or other disposition), or consent to any transfer of, any or all of
such Stockholder's Shares or any interest therein, (ii) enter into any
contract, option or other agreement of understanding with respect to any
transfer of any or all of such Stockholder's Shares or any interest
therein, (iii) grant any proxy, power-of-attorney or other authorization in
or with respect to such Stockholder's Shares, (iv) deposit such
Stockholder's Shares into a voting trust or enter into a voting agreement
or arrangement with respect to such Stockholder's Shares or (v) take any
other action that would in any way restrict, limit or interfere with the
performance of his or her obligations hereunder or the transactions
contemplated hereby.

(b) Stockholder shall not, directly or indirectly, solicit, initiate
or encourage the submission of, any takeover proposal with respect to RHI.

(c) At any meeting of stockholders of RHI or at any adjournment
thereof or in any other circumstances upon which their vote, consent or
other approval is sought, Stockholder shall vote (or cause to be voted) any
voting shares of RHI Common Stock which he or she has the power to vote
against (i) any merger agreement or merger, consolidation, combination,
tender offer (including an exchange offer), sale of substantial assets,
reorganization, joint venture, recapitalization, dissolution, liquidation
or winding up of or by RHI (other than the Merger as set forth in the
Merger Agreement) and (ii) any amendment of RHI's Articles of Incorporation
or By-laws or other proposal or transaction involving RHI or any of its
subsidiaries which amendment or other proposal or

Stockholder Agreement of William Reesman Page 5
<PAGE>

transaction would in any manner impede, frustrate, prevent or nullify, or
result in a breach of any covenant, representation or warranty or any other
obligation or agreement of RHI under or with respect to the Merger
Agreement or any of the other transactions contemplated by the Merger
Agreement (each of the foregoing in clause (i) or (ii) above, a "Competing
Transaction").

Section 4. Certain Events. Stockholder agrees that this Agreement and the
obligations hereunder shall attach to such Stockholder's Shares and the Options
and shall be binding upon any person or entity to which legal or beneficial
ownership of such Shares or Options shall pass, whether by operation of law or
otherwise, including without limitation Stockholder's heirs, guardians,
administrators or successors. In the event of any stock split, stock dividend,
merger, reorganization, recapitalization or other change in the capital
structure of RHI affecting the RHI Common Stock, or the acquisition of
additional shares of RHI Common Stock or other voting securities of RHI by any
Stockholder, the number of Stockholder's Shares listed in Schedule A beside the
name of Stockholder shall be adjusted appropriately and this Agreement and the
obligations hereunder shall attach to any additional shares of RHI Common Stock
or other voting securities of RHI issued to or acquired by Stockholder.

Section 5. Intentionally Omitted.

Section 6. Stockholder Capacity. No person executing this Agreement who
is or becomes during the term hereof a director or officer of RHI makes any
agreement or understanding herein in his or her capacity as such director or
officer. Stockholder signs solely in his or her capacity as the record holder
and beneficial owner of such Stockholder's Shares and Options and nothing herein
shall limit or affect any actions taken by a Stockholder in his or her capacity
as an officer or director of RHI to the extent specifically permitted by the
Merger Agreement.

Section 7. Affiliate Agreements. Prior to the Effective Time, Stockholder
hereby agrees to execute and deliver to Household a Rule 145 Affiliate
Agreement, substantially in the form of Exhibit A to the Merger Agreement.

Section 8. Termination. Other than Section 9 which shall survive, this
Agreement, and all rights and obligations of the parties hereunder, shall
terminate as of the Effective Time. In addition, this Agreement, and all rights
and obligations of the parties hereunder, shall terminate concurrent with a
termination of the Merger Agreement for any reason. Any termination shall not
affect any rights or remedies for breach of this Agreement that may have accrued
to a party hereto prior to the date of termination.

Section 9. Miscellaneous.

(a) Capitalized terms used and not otherwise defined in this Agreement
shall have the respective meanings assigned such terms in the Merger
Agreement.

Stockholder Agreement of William Reesman Page 6
<PAGE>

(b) All notices, requests, claims, demands and other communications
under this Agreement shall be in writing and shall be deemed given if
delivered personally or sent by overnight courier (providing proof of
delivery) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice): (i) if to
Household or RHI, to the address set forth in Section 9.4 of the Merger
Agreement; (ii) if to a Stockholder, to the address set forth in Schedule A
hereto, or such other address as may be specified in writing by
Stockholder; and (iii) if to Principal, at:

Renaissance Holdings, Inc.
9400 S.W. Beaverton-Hillsdale Avenue
Suite 300
Beaverton, OR 97005

(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of this Agreement.

(d) This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and shall become
effective as to Stockholder, Household, Principal and RHI when one or more
counterparts have been signed by, and delivered to, each of them.

(e) This Agreement (including the documents and instruments referred
to herein) constitutes the entire agreement, and supersedes all prior
agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof.

(f) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Oregon, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.

(g) Neither this Agreement nor any of the rights, interests or
obligations under this Agreement shall be assigned, in whole or in part, by
operation of law or otherwise, by any of the parties without the prior
written consent of the other parties, except by laws of descent.

(h) If any term, provision, covenant or restriction herein, or the
application thereof to any circumstance, shall, to any extent, be held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions herein and
the application thereof to any other circumstances, shall remain in full
force and effect, shall not in any way be affected, impaired or
invalidated, and shall be enforced to the fullest extent permitted by law.

(i) Each party agrees that irreparable damage would occur and that the
non-breaching party would not have any adequate remedy at law in the event
that any of the provisions of this Agreement were not performed in
accordance with their specific terms

Stockholder Agreement of William Reesman Page 7
<PAGE>

or were otherwise breached. It is accordingly agreed that any non-breaching
party shall be entitled to an injunction or injunctions to prevent breaches
by any breaching party of this Agreement and to enforce specifically the
terms and provisions of this Agreement in any court of the United States
located in the State of Oregon or in Oregon state court, this being in
addition to any other remedy to which they are entitled at law or in equity
or under the Merger Agreement. In addition, each of the parties hereto (i)
consents and submits to the personal jurisdiction of any Federal court
located in the State of Oregon or any Oregon state court in the event any
dispute arises out of this Agreement or any of the transactions
contemplated hereby, other than the Merger Agreement, (ii) agrees that such
party will not attempt to deny or defeat such personal jurisdiction by
motion or other request for leave from any such court and (iii) agrees that
such party will not bring any action relating to this Agreement or any of
the transactions contemplated hereby, other than the Merger Agreement, in
any court other than a Federal court sitting in the State of Oregon or a
Oregon state court. It is further agreed that any breaching or defaulting
party hereunder shall pay to the other parties hereto such out of pocket
costs and expenses, including legal and accounting fees, as are reasonably
incurred in pursuit of such parties' remedies hereunder.

(j) No amendment, modification or waiver in respect of this Agreement
shall be effective against any party unless it shall be in writing and
signed by such party. Household and RHI agree not to amend or modify the
Merger Agreement if such amendment or modification changes the form or
amount of the Merger Consideration unless Stockholder shall have consented
in writing to such amendment or modification.

(Remainder of page intentionally left blank)

Stockholder Agreement of William Reesman Page 8
<PAGE>

IN WITNESS WHEREOF, Household, RHI, the Principal and the Stockholder have
caused this Agreement to be duly executed and delivered as of the date first
written above.

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta
-------------------------------------
Title: Group Executive
-------------------------------------

RENAISSANCE HOLDINGS, INC.

By: /s/ Irving J. Levin
--------------------------------------
Title: CEO
--------------------------------------

/s/ Irving J. Levin
____________________________________________
IRVING J. LEVIN

/s/ William Reesman
___________________________________________
STOCKHOLDER

Stockholder Agreement of William Reesman Page 9
<PAGE>

SCHEDULE A
----------

Name and Address of Stockholder Number of Stockholder Shares
- ------------------------------- ----------------------------

William Reesman 659,680
c/o Renaissance Holdings, Inc.
9400 S.W. Beaverton-Hillsdale Avenue
Suite 300
Beaverton, OR 97005

Stockholder Agreement of William Reesman Page 10
<PAGE>

SCHEDULE B
----------

None

Stockholder Agreement of William Reesman Page 11
<PAGE>

EXHIBIT LIST
------------
<TABLE>
<S> <C> <C>
Exhibit A - Merger Agreement

Exhibit B - Stockholder Agreement with Irving J. Levin, as a Restricted Shareholder
and Principal

Exhibit C - Stockholder Agreement with George F. Alexander and Sharon C.
Alexander

Exhibit D - Stockholder Agreement with Karen D. Frolich

Exhibit E - Stockholder Agreement with N. Goldschmidt

Exhibit F - Stockholder Agreement with Martin Mitchell and V. Mitchell

Exhibit G - Stockholder Agreement with N. Nelson

Exhibit H - Stockholder Agreement with Patricia Reesman

Exhibit I - Stockholder Agreement with Ruth Scherbarth

Exhibit J - GECC Stockholder Agreement
</TABLE>

Stockholder Agreement of William Reesman Page 12

<PAGE>

EXHIBIT 10.12(a)
----------------

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT

George F. Alexander The Executive
18845 Eastside Rd.
Lake Oswego, OR 97034

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005-3363

1. Employment.
----------

The Company hereby employs Executive as its Executive Vice President and
Executive hereby accepts this Executive Compensation and Benefits Agreement in
conjunction with his/her employment with the Company.

2. Effective Date.
--------------

This Agreement is effective September 1, 1999 (the "Effective Date"), and
shall continue through August 31, 2002, unless extended by mutual agreement or
terminated earlier as hereinafter provided.

3. Duties and Responsibilities.
---------------------------

Executive will, during the term of this Agreement, faithfully and
diligently perform all such acts and duties and have such responsibilities and
furnish such services as the Chief Executive Officer of the Company or his/her
designee shall reasonably direct, including but not limited to those listed in
Attachment A hereto. Executive will devote such time, energy, and skill to the
business of the Company as shall reasonably be required for the performance of
his/her duties.

4. Salary and Bonus.
----------------

4.1 Salary. Executive will be paid a salary of not less than his current
------
salary of $155,000 on an annualized basis, payable on regular Company paydays.
Executive's annual salary shall be reviewed by the Company's Chief Executive
Officer and Board of Directors each year during the term of this Agreement for
adjustment as determined appropriate by the Board. Except as specifically stated
herein or as provided on the date of execution of this Agreement (in the case of
32 days of Paid Time Off per year and Executive's entitlement to the Management
Incentive Premium), Executive otherwise will

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 1 of 9
<PAGE>

receive the same Company benefits and be subject to the same policies,
practices, terms and conditions of employment as are other regular Company
employees.

4.2 Bonus. In addition to Executive's base salary, Executive is eligible
-----
to participate in the Company's Management Incentive Plan, as approved and
amended by the Board in its sole discretion, subject to objectives established
annually by the Board. Attachment B, hereto, summarizes Executive's
participation and objectives for the plan year ending December 31, 1999.

5. Stock Option Grant.
------------------

Executive shall be given a stock option grant of twenty thousand (20,000) shares
upon execution of this Agreement, which options will vest over three years in
accordance with and subject to the terms and conditions of the Renaissance
Holdings, Inc., 1997 Amended and Restated Stock Incentive Plan (the Stock Option
Plan). This stock option grant represents a multi-year grant and is given in
consideration of Executive's execution of Agreement.

To the maximum extent permitted by law, such options shall be in the form of
incentive stock options. The exercise price for the options shall be $14 per
share, subject to the adjustment provisions set forth in the Stock Option Plan.
Executive shall be eligible for consideration for additional option grants, in
the sole discretion of the Board and subject to the terms and conditions of the
Stock Option Plan.

6. Confidential Information and Nonsolicitation.
--------------------------------------------

Executive (shall execute/has executed) a Confidentiality and Nonsolicitation
Agreement in the form attached hereto as Attachment C which shall survive the
termination of this Agreement.

7. Termination and Severance.
-------------------------

7.1 Except as specifically provided for in this Agreement, Executive shall
not be eligible for severance pay or benefits under any other policy, program,
plan, or practice of the Company.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 2 of 9

<PAGE>

Executive becomes eligible for comparable group health coverage of Medicare,
whichever is earlier. (At its sole discretion the Company may pay Executive the
cash equivalent of the COBRA benefit rather than payment of premiums on
Executive's behalf.)

As an additional severance benefit, the Company will provide Executive with
outplacement assistance with an outplacement provider of the Company's choice,
up to a maximum fee of twelve percent (12%) of Executive's salary. Severance
benefits shall not include payment in connection with an award of any stock
option or grant, the eligibility for which will be governed solely by the terms
of the Stock Option Plan.

7.3 If Executive's employment is terminated for cause by Company or if
Executive terminates his/her employment for any reason, Executive shall not be
entitled to severance pay or benefits under this Agreement.

7.4 For purposes of this Agreement, cause for termination includes, but is
not limited to, the following types of conduct and circumstances: breach of any
material provision of this Agreement; material violation of any statutory or
common law duty of loyalty to the Company; conduct or performance that, in the
judgment of the Company, adversely affects the interests of the Company or any
of its affiliated or related entities or injuries or tends to injure the
reputation of the Company or any of its affiliated or related entities; or
conduct that, in the judgment of the Company creates a conflict of interest or
the appearance of a conflict of interest between Executive and the Company or
any of its affiliated or related entities.

7.5 This Agreement shall terminate automatically in the event of
Executive's death, without any obligation on the part of the Company to provide
severance benefits to Executive's estate. However, the Company will pay the cost
of continuation of existing group health insurance coverage for Executive's
spouse, if any, and eligible dependents covered at the time of Executive's death
for a period of up to twelve (12) months or such earlier date that the spouse
and eligible dependent(s) are eligible for comparable group health coverage or
Medicare (or in the Company's sole discretion, pay the cash equivalent of this
benefit).

7.6 The Company, in its sole discretion, may elect to terminate this
Agreement and Executive's employment in the event Executive is unable or
unwilling to perform the essential duties and responsibilities of his/her
position for a period of more than six months due to disability, without any
obligation on the part of the Company to provide severance benefits to
Executive. However, the Company will pay the cost of continuation of Executive's
existing group health insurance coverage for a period of up to twelve (12)
months or such earlier date that Executive is eligible for comparable group
health coverage or Medicare or, in the Company's sole discretion, pay the cash
equivalent of this benefit.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 3 of 9
<PAGE>

7.7 For purposes of this Section 7, Executive's employment shall not be
considered terminated by the Company solely by reason of a change in Executive's
position, duties, responsibilities, compensation, benefits, or location of
employment, provided Executive remains in a position deemed by the Company to be
at substantially the same level (including compensation) as the position
described in Section 3 above, and provided that the location of employment of
Executive remains within 30 miles of downtown Beaverton, Oregon.

7.8 Severance pay and benefits under Section 7 are subject to applicable
tax and withholdings and deductions. Severance benefits, other than outplacement
assistance, shall be paid pro-rata on regular Company paydays.

7.9 In addition to the foregoing conditions, eligibility for a receipt of
severance benefits under Section 7 are subject to Executive executing and not
revoking a Separation Agreement and Release of Claims in a form provided to
Executive by the Company at the time of termination.

7.10 Severance benefits under Section 7 shall not be included as
compensation under any retirement plan maintained by the Company or an affiliate
unless the retirement plan provides otherwise.

7.11 Notwithstanding the foregoing, Executive shall not be eligible for
severance pay or shall forfeit any outstanding severance pay and benefits
amounts, as applicable, under this Section 7 if:

7.11.1 Executive accepts an offer of re-employment by the Company
or any affiliate of the Company at any time during the 12-month period
commencing on the date of Executive's termination of employment with the
Company; provided, however, that for purposes of this Section 7.11.1 Executive
shall not be deemed to be an employee if Executive is providing consulting
services to the Company or an affiliate under a commitment not expected to
result in annualized compensation of greater than $100,000 per year.

7.11.2 Executive fails to execute any documents or satisfy
conditions reasonably required by the Company in order to receive severance
benefits under this Agreement or fails to return property of the Company or an
affiliate within the time period designated by the Company for acceptance of
severance benefits.

7.11.3 Executive fails to execute or breaches any agreement
required by the Company, including but not limited to cessation of benefits and
repayment of severance benefits in the event of rehire or reemployment by the
Company or an affiliate or in the event of any material breach of any required
confidentiality, nonsolicitation.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 4 of 9
<PAGE>

nondisparagement, assistance to the Company or assistance in defense of
litigation agreements or a provision of the Release of Claims.

7.11.4 Executive accepts employment or enters into any business
relationship with, or becomes, or acquires ownership of more than five percent
(5%) interest in, a competitor of the Company less than 12 months after
termination with the Company.

7.11.5 Executive is eligible for severance pay and benefits under
Section 8 of this Agreement.

8. Change in Control.
-----------------

8.1 If, following a Change in Control (as hereinafter defined),
Executive's employment is terminated by the Company other than for cause within
12 months following a Change of Control or if Executive resigns from employment
following a material alteration in Executive's position that has a detrimental
impact on Executive (as hereinafter defined), Executive shall receive as
severance pay an amount equal to 18 months of Executive's salary and a pro-rata
portion of Executive's target bonus reflecting Executive's partial year of
service as of the date of termination. As an additional severance benefit, the
Company will pay up to 18 months of COBRA premiums or until Executive becomes
eligible for comparable group health coverage or Medicare, whichever is earlier.
As an additional severance benefit, the Company will provide Executive with
outplacement assistance with an outplacement provider of the Company's choice,
up to a maximum fee of twelve percent (12%) of Executive's salary. Severance
benefits shall not include payment in connection with an award of any stock
option or grant, the eligibility for which will be governed solely by the terms
of the Stock Plan. No other severance pay or benefits shall be payable to
Executive, including but not limited to severance pay or benefits under Section
7 of this Agreement.

8.2 For the purposes of this Section 8, Change in Control shall occur if
any of the following applies:

8.2.1 Any person, as such term is used in Sections 13(d) and 14(d)
of the Securities Exchange Act of 1934, as amended (the Exchange Act) (other
than the Company, any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, or any company owned, directly or
indirectly, by the shareholders of the Company in substantially the same
proportion as their ownership of stock of the Company) is or becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 51 percent or more of the
combined voting power of the Company's then outstanding securities;

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 5 of 9
<PAGE>

8.2.2 The shareholders of the Company approve a merger or other
consolidation of the Company with any other Company other than (1) a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) 51 percent or more of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger of consolidation or (2) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no
Person acquired more than 51 percent of the combined voting power of the
Company's then outstanding securities;

8.2.3 A tender or exchange offer is made for the common stock of
the Company (or securities convertible into common stock of the Company) and
such offer results in a portion of those securities being purchased and the
offeror, after the consummation of the offer, is the beneficial owner (as
determined pursuant to Section 13(d) of the Exchange Act), directly or
indirectly, of securities representing at least 51 percent of the voting power
of outstanding securities of the Company; or

8.2.4 The Company sells all or substantially all of its operating
assets to a buyer that is not a member of the Renaissance controlled group of
corporations.

8.3 For the purposes of this Section 8, there is a material alteration in
the employee's position that has a detrimental impact on the employee if:

8.3.1 Executive's principal work location is moved more than 30
miles;

8.3.2 Executive's salary and target bonus opportunity is reduced
by at least 15 percent of Executive's base salary and target bonus opportunity
before the change in compensation and the reduction is not the result of a
general reduction in compensation for reasons unrelated to Executive's
assignment; or

8.3.3 There is a material reduction in the scope of Executive's
responsibilities or authority.

8.4 Severance pay and benefits under Section 8 are subject to tax and
other applicable withholdings and deductions. Severance benefits, other than
outplacement assistance, shall be paid pro-rata on regular Company paydays.

8.5 In addition to the foregoing conditions, eligibility for and receipt
of severance benefits under Section 8 are subject to Executive executing and not
revoking a Separation

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 6 of 9
<PAGE>

Agreement and Release of Claims in a form provided to Executive by the Company
at the time of termination.

8.6 Severance benefits under Section 8 shall not be included as compensation
under any retirement plan maintained by the Company or an affiliate unless the
retirement plan provides otherwise.

8.7 Notwithstanding the foregoing, Executive shall not be eligible for
severance benefits or shall forfeit any outstanding severance pay and benefits
amounts, as applicable, under this Section 8 if:

8.7.1 Executive accepts an offer of severance benefits under any
other severance plan or program maintained by the Company, or an affiliate of
the Company or enters into any individual severance agreement with the Company
or an affiliate that supersedes this Agreement or is terminated pursuant to
Section 7 of this Agreement or voluntarily resigns from employment for any
reason that does not constitute a material alteration in Executive's position
that has a detrimental impact on Executive (as defined above).

8.7.2 Executive is involuntarily terminated for either gross misconduct
or gross negligence or conduct which indicates a reckless disregard for the
consequences and has a material adverse effect on the Company or an affiliate.

8.7.3 Executive fails to execute any documents or satisfy conditions
reasonably required by the Company in order to receive severance benefits under
this Agreement or fails to return property of the Company or an affiliate within
the time period designated by the Company for acceptance of severance benefits.

8.7.4 Executive fails to execute or breaches any agreement required by
the Company, including but not limited to cessation of benefits and repayment of
severance benefits in the event of rehire or reemployment by the Company or an
affiliate or in the event of any material breach of any required
confidentiality, nonsolicitation, nondisparagement, assistance to the Company
and assistance in defense of litigation agreements or a provision of the Release
of Claims.

8.7.5 Executive accepts an offer of re-employment by the Company or any
affiliate of the Company at any time during the 18-month period commencing on
the date of Executive's termination of employment with the Company; provided,
however, that for purposes of this Section 8.7.5 Executive shall not be deemed
to be an employee if Executive is providing consulting services to the Company
or an affiliate under a commitment not expected to result in annualized
compensation of greater than $100,000 per year.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 7 of 9
<PAGE>

8.7.6 Executive accepts employment or enters into any business
relationship with, or becomes, or acquires ownership of more than a five percent
(5%) interest in, a competitor of Company less than 18 months after termination
with the Company.

9. General Provisions.
------------------

9.1 Except as specifically provided herein, Executive's employment with the
Company shall be subject to the same terms and conditions as applicable to other
employees of the Company, including but not limited to the right of either party
to terminate the employment relationship at any time and for any reason.

9.2 This Agreement shall be construed in accordance with and governed by the
laws of the State of Oregon.

9.3 Executive agrees that any dispute (1) concerning the interpretation or
construction of this Agreement, (2) relating to any compensation or benefits
Executive may claim, or (3) relating in any way to any claim by Executive for
reinstatement or reemployment by the Company after execution of this Agreement
shall first be submitted to confidential mediation before a mediator selected by
the parties. Should any dispute not be resolved through mediation, it shall be
submitted and settled exclusively by confidential arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration Association or such
comparable rules as may be agreed upon by the parties. The parties shall be
responsible for their own costs and legal fees in any mediation or arbitration
proceeding. Both parties agree that the procedures outlined in this Section are
the exclusive methods of dispute resolution.

9.4 This Agreement contains the entire agreement between Executive and the
Company concerning the subject matters discussed herein. Any modification of
this Agreement shall be effective only if in writing and signed by each party or
its duly authorized representative. This Agreement supersedes all prior
employment agreements between the parties. The terms of this Agreement are
contractual and not mere recitals. If, for any reason, any provision of this
Agreement shall be held invalid in whole or in part, such invalidity shall not
affect the remainder of this Agreement.

9.5 The waiver of any breach of this Agreement by one party shall not
constitute waiver by the non-breaching party of any other breach of the
Agreement.

9.6 This Agreement is subject to, and conditioned on, ratification of its terms
by the Board of Directors of the Company.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 8 of 9
<PAGE>

RENAISSANCE HOLDINGS, INC.

By /s/ Irving J. Levin 8/15/99
----------------------------- -----------------------------
Its: Chief Executive Officer Date

/s/ George F. Alexander 8/5/99
- -------------------------------- -----------------------------
Executive Signature Date

Attachment A: Duties and Responsibilities of Executive
Attachment B: Target Bonus Participation Document
Attachment C: Confidentiality and Nonsolicitation Agreement

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Page 9 of 9
<PAGE>

Renaissance
HOLDINGS, INC.

JOB DESCRIPTION

TITLE: Executive Vice President

GRADE:

RANGE:

REPORTS TO: Chief Executive Officer

SUMMARY: The Executive Vice President is responsible for planning and
implementing organizational business strategies to enable
the company to meet its growth and profit goals. Areas of
focus include project management relating to strategic
alliances, vendor relationships, new ventures, operational
efficiencies and policy advisement. The Executive Vice
President is part of the Management Committee of RHI.

DUTIES AND
RESPONSIBILITIES:

. Participates in setting overall strategic direction for the company by
establishing goals for business units within RHI to support the Company's
overall strategic objectives;

. Directs development of RCP and other new ventures;

. Responsible for servicing platform decisions and major enhancements (CRM)

. Participates in the negotiation of major contracts and in the development
of strategic partnerships and alliances with vendors, creditors, clients
and other business partners to ensure profitable products and services;

. Effectively manages multiple projects and processes in a fast-paced,
rapidly changing business environment;

. Educates, mentors and coaches direct reports to develop managerial skills
and abilities; Establishes succession plans for key positions;

ACCOUNTABILITY:

The Executive Vice President has a significant and primary
impact on policy and strategy formulation. The Executive
Vice president is responsible for mentoring and developing
managers and leading process and technology initiatives. The
Executive Vice President must apply principles of logical
and conceptual thinking to a wide range of intellectual and
practical problems, dealing with large
<PAGE>

number of variables to determine a specific course of action
on the basis of need. Errors in judgment and discretion
could have a more than significant impact on the Company's
profitability and growth goals.

QUALIFICATIONS:

Knowledge:

. Four year Bachelor's Degree. Master's degree in Economics or
other Business related discipline is preferred along with
extensive background in portfolio management and operations
centers preferably in the financial services or in a high
transaction processing business industry.
. 10 to 15 years of experience in managing multiple functions
within an organization; 5 to 7 years experience in a senior
management capacity.
. Experience directing business process design and implementation
of projects that provide tangible results such as improved
quality, productivity and business value.
. Knowledge and experience in applying ethical businesses practices
in day-to-day operations management and decision making.
. Successful experience in profit center management.

Skills:

. Excellent written and verbal communication skills.
. Demonstrated problem solving skills.
. Exceptionally strong leadership and interpersonal skills.
. Strong business analysis skills.
. Highly developed sense of business ethics.

Abilities:

. Judgment and ability to work with other senior management on
complex technical organizational issues and corporate strategic
planning.
. Ability to make good business decisions in support of strategic
Company goals.
. Ability to work independently and as a team member to
professionally represent the Company.
. Ability to work in a fast-paced, entrepreneurial environment.
. Incumbent must have a process orientation to identify problems,
formulate solutions and implement improvements.
. Ability to think conceptually and manage detail.
. Strong work ethic: efficient, well organized, dependable,
self-starter, flexible.
. Ability to represent the Company internally and externally.

ESSENTIAL
FUNCTIONS:

system. It requires access to all areas of the office, and
the ability to sit for extended periods of time,
periodically bending and twisting, and frequent application
of a negligible amount of force to lift, carry, push, pull,
or otherwise move objects. The incumbent must be able to
perform the essential functions of this position with or
without reasonable accommodation. The Company will provide
reasonable accommodation where necessary.

This is an exempt position.

Written By __________________________ Date _______________

Approved By /s/ George F. Alexander Date 11/24/99
------------------------- ---------------

JD 00125

Job descriptions are not intended to be all-inclusive lists of all
responsibilities, skills, efforts or working conditions associated with a job.
While this job description is intended to be an accurate reflection of the job
requirements, management reserves the right to modify, add or remove duties from
particular jobs and assign other duties as necessary.

New 11/99
<PAGE>

Attachment B

[LOGO OF RENAISSANCE HOLDINGS, INC.]

Memorandum
- --------------------------------------------------------------------------------

TO: RHI Management

FROM: Irving Levin / Senior Management Team

DATE: May 7, 1999

RE: 1999 Discretionary Bonus Program

Our phenomenal first quarter performance ($4.3mm net profit!) reminded me of the
need to communicate bonus strategies for 1999. The Renaissance Holdings Board of
Directors agreed at our last meeting that the 1998 bonus strategy of "all or
nothing" was too severe. (Meaning that we could have had a pretty terrific year
but not received bonuses were we to have missed our aggressive profit target of
$4.0mm).

This year we have modified the program. Our target net profit is $7.5mm, and a
modest bonus pool will be funded once profits exceed $6.0mm. If we hit $6.0mm,
bonuses will be small and skewed toward staff, supervisors and lower-level
management. The pool will gain funding continuously over $6.0mm. At $7.5mm the
funding rate shall increase: profits above $7.5mm shall ensure a healthy bonus
pool. And just like last year, each dollar of profit adds to the bonus pool with
no limit.

We have made a significant step toward hitting our target--we're 57% there after
the first quarter. Even though we are more cautious about the next three
quarters, we're still confident we can exceed $7.5mm. However, reiterating
earlier comments, bonuses can vary widely from year to year, and that none of us
should count our chickens. Let's go out and make them hatch.

Here is some additional discretionary bonus program information:
. Eligibility: All employees employed before July 1/st/ of the bonus year are
eligible to be considered for a bonus, with prorated amounts for less than
one full year of service. Employees must be working and on the payroll when
bonuses are distributed.
. Discretionary bonus award criteria falls into two categories:
Company performance (as outlined above) and individual performance in the
following areas:
- Overall job performance and contributions
- Dependability
- Major accomplishments
- Other factors (e.g., Special projects, etc)
. Achieving the profit goal does not ensure that any employee will receive a
bonus. Once the pool is funded, our existing process for determining
bonuses will be followed.
. The profit goals will change annually.
. The stock option and profit-sharing programs are not affected by the bonus
program.

I am available to discuss with any and all. Please share this information with
your employees.
<PAGE>

[LOGO OF RENAISSANCE
HOLDINGS, INC.] Attachment C

[LOGO OF RENAISSANCE [LOGO OF
BANKCARD SERVICES] ORCHARD BANK]

Confidentiality, Non-solicitation and Non-competition Agreement
- ---------------------------------------------------------------

Renaissance Bankcard Services, Inc., Orchard Federal Savings Bank and
Renaissance Holdings, Inc. are recognized as industry leaders in the
highly-competitive credit card business. Accordingly, many companies actively
seek to obtain confidential information related to our companies. To guard
against this, and clarify our confidentiality requirements for employees, we are
asking you to enter into this Confidentiality, Non-solicitation and Non-
competition Agreement and to abide by its terms.

In consideration of my employment with Renaissance Bankcard Services, Inc.,
and/or Orchard Federal Savings Bank and/or Renaissance Holdings, Inc., I agree
to the following:

1. Confidentiality. I understand that as an employee I have had and/or will
-------------------
have access to proprietary information, trade secrets, and other
information treated by Renaissance Bankcard Services, Inc., Orchard Federal
Savings Bank and Renaissance Holdings, Inc. (individually or collectively,
the "Company") as Confidential Information, that such information is a
valuable asset of Company and that its disclosure or unauthorized use will
cause Company irreparable harm. As used in this Agreement the term
"Confidential Information" means: (a) proprietary information of Company;
(b) information marked or designated by Company as confidential; (c)
information that is known to me to be treated by Company as confidential
and (d) information provided to Company by third parties which Company is
obligated to keep confidential. It also includes, but is not limited to,
trade secrets as defined under the Uniform Trade Secrets Act, all
information relating to Company's clients and customers including their
names, addresses and address lists, credit card, savings or other account
numbers, all information supplied by clients and customers, credit card
portfolios, profitability statistics and loss rates, credit card
transactions, scoring techniques, policies and reports, business
strategies, pricing, technology, methods, techniques, procedures, products,
costs, employee compensation, marketing plans, computer programs or
systems, inventions, developments, and trade secrets of every kind and
character. I agree that I will not disclose any Confidential Information to
any person, agency or court unless compelled to do so by law. I also will
not use Confidential Information for my own benefit or that of any other
person, corporation, government or other entity. If I am required by law to
disclose any Confidential Information, before doing so I will notify the
Director of Human Resources of the Company and provide a copy of the
subpoena, summons or other legal document. I agree that upon my separation
from employment (or earlier if requested by Company), I will return to
Company all originals and copies of documents and other materials in my
possession or control relating to Company or containing or derived from
Confidential Information. If requested, I agree to execute a written
certification satisfactory to Company to the effect that all such documents
and materials have been returned.

2. Non-solicitation of Employees. I agree that I will not solicit, divert
---------------------------------
or take away either the employment of any employees or customers of the
Company for a period of one (1) year from the date my employment with
Company ends. I specifically acknowledge and agree that the terms of this
provision are reasonable in every respect and in particular because of the
comprehensive and specialized nature of the Company's business.

Non-competition, Confidentiality and Non-solicitation Agreement
Page 1 of 2

<PAGE>

Exhibit 10.12(b)
----------------

Amendment and Continuation of Executive Compensation and Benefits
Agreement

George F. Alexander The Executive
18845 Eastside Rd.
Lake Oswego, OR 97034

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005

Household International, Inc. Household
2700 Sanders Road
Prospect Heights, IL 60070

The Company has previously entered into the Executive Compensation and Benefits
Agreement with the Executive effective as of September 1, 1999 (the
"Agreement"). It is contemplated that the Company will be merged into
Renaissance Credit Services, Inc., a Delaware corporation ("RCS"), a subsidiary
of Household. It is the desire of the Executive and Household that the
Agreement be continued by RCS upon such merger. Accordingly, as of the closing
date (the "Closing Date") of such merger, the following changes to the Agreement
shall become effective:

1. "RCS" shall be substituted for the "Company" wherever appropriate.

2. Executive will receive a salary increase resulting in an annual salary of
$167,400.

3. Executive will be eligible for an annual bonus under the Household
International Corporation Executive Bonus Plan and any successor or
substitute plan or plans (the "Bonus Plan") having a target value equal to
forty percent (40%) and a maximum value of sixty percent (60%) of
Executive's annualized salary as of the end of the period in which the bonus
is earned. The amount of bonus for any year that Executive actually
receives, if any, will depend on the achievement of the corporation and
Executive individual goals established for that year and the terms of the
Bonus Plan. Executive's bonus will be prorated based on the number of
elapsed months in the performance period in the case of death, disability
(as described in paragraph 7.6), or retirement under the Household
Retirement Income Plan or any successor tax qualified defined benefit plan.
This bonus shall be in place of any bonus under the Company's Management
Incentive Premium or Management Incentive Plan.

4. Instead of being eligible for additional option grants for Company stock,
Executive shall be eligible for future grants of stock options and/or
restricted stock rights under the Household International 1996 Long-Term
Executive Incentive Compensation Plan and any successor or substitute plan
or plans. The amount and frequency of future grants shall be solely
determined by Household's Board of Directors and shall reflect Executive's
level of responsibility within Household and its affiliates.
<PAGE>

5. During the course of Executive's performance under this Agreement,
Executive will receive and be exposed to confidential and proprietary
information relating to Household's and its affiliates' business practices
and strategies ("Confidential Information"). Such Confidential Information
may include but shall not be limited to confidential and proprietary
information that is marked "Confidential" or its equivalent and the
marketing and customer support strategies, financial information, including
sales, costs, profits and pricing methods, internal organizations, employee
lists and customer lists of Household and its affiliates. At all times
during the term of employment and thereafter, Executive will hold in
strictest confidence and will not disclose or use any Confidential
Information, except as such disclosure or use may be required in connection
with Executive's work for Household or its affiliates. Notwithstanding the
foregoing, "Confidential Information" shall not be deemed to include
information which Executive can demonstrate is now, or hereafter becomes,
through no act or failure to act on Executive's part, generally known or
publicly available.

6. For the period ending one (1) year after the termination of this Agreement
or after Executive's termination of employment, whichever is later,
Executive will not solicit customers of Household or its affiliates nor
solicit to hire any employee of Household or its affiliates which would
result in a termination of his or her employment with Household or its
affiliates in order to join any company or organization in which Executive
has an interest, financially or otherwise.

Renaissance Holdings, Inc. Date: 12/1/99
-----------

By: /s/ Irving J. Levin
-----------------------------------
Irving J. Levin
Its Chief Executive Officer

Household International, Inc. Date: 12/1/99
-----------

By: /s/ S. N. Mehta
-----------------------------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Executive Date: 12/1/99
-----------

/s/ George F. Alexander
- ----------------------------------------

<PAGE>

EXHIBIT 10.13(a)

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT

Charles B. Engelberg The Executive
14542 Kruse Oaks Blvd.
Lake Oswego, OR 97035

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005-3363

1. Employment.
----------

The Company hereby employs Executive as its Senior Vice President/Chief
Financial Officer and Executive hereby accepts this Executive Compensation and
Benefits Agreement in conjunction with his/her employment with the Company.

2. Effective Date.
--------------

This Agreement is effective September 1, 1999 (the "Effective Date"), and
shall continue through August 31, 2002, unless extended by mutual agreement or
terminated earlier as hereinafter provided.

3. Duties and Responsibilities.
---------------------------

4. Salary and Bonus.
----------------

4.1 Salary. Executive will be paid a salary of not less than his current
------
salary of $150,000 on an annualized basis, payable on regular Company paydays.
Executive's annual salary shall be reviewed by the Company's Chief Executive
Officer and Board of Directors each year during the term of this Agreement for
adjustment as determined appropriate by the Board. Except as specifically stated
herein, Executive otherwise will receive the same Company benefits and be
subject to the same policies, practices, terms and conditions of employment as
are other regular Company employees.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 1 of 8
<PAGE>

5. Stock Option Grant.
------------------

Executive shall be given a stock option grant of forty thousand (40,000) shares
upon execution of this Agreement, which options will vest over three years in
accordance with and subject to the terms and conditions of the Renaissance
Holdings, Inc., 1997 Amended and Restated Stock Incentive Plan (the Stock Option
Plan). This stock option grant represents a multi-year grant and is given in
consideration of Executive's execution of Agreement.

6. Confidential Information and Nonsolicitation.
--------------------------------------------

Executive (shall execute/has executed) a Confidentiality and Nonsolicitation
Agreement in the form attached hereto as Attachment C which shall survive the
termination of this Agreement.

7. Termination and Severance.
-------------------------

7.1 Except as specifically provided for in this Agreement, Executive shall
not be eligible for severance pay or benefits under any other policy, program,
plan, or practice of the Company.

7.2 If Executive's employment is terminated by the Company other than for
cause, as hereinafter defined, or pursuant to Sections 7.4 (death) or 7.6
(disability) or 8 (Change of Control) below, Executive shall receive as
severance pay an amount equal to 12 months of Executive's base compensation and
a pro-rata portion of Executive's target bonus reflecting Executive's partial
year of service as of the date of termination. As an additional severance
benefit, the Company will pay up to 12 months of COBRA premiums or until
Executive becomes eligible for comparable group health coverage of Medicare,
whichever is earlier. (At its sole discretion the Company may pay Executive the
cash equivalent of the COBRA benefit rather than payment of premiums on
Executive's behalf.)

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 2 of 8
<PAGE>

As an additional severance benefit, the Company will provide Executive with
outplacement assistance with an outplacement provider of the Company's choice,
up to a maximum fee of twelve percent (12%) of Executive's base compensation.
Severance benefits shall not include payment in connection with an award of any
stock option or grant, the eligibility for which will be governed solely by the
terms of the Stock Option Plan.

7.4 For purposes of this Agreement, cause for termination includes, but is
not limited to, the following types of conduct and circumstances: breach of any
material provision of this Agreement; material violation of any statutory or
common law duty of loyalty to the Company; conduct or performance that, in the
judgment of the Company, adversely affects the interests of the Company or any
of its affiliated or related entities or injures or tends to injure the
reputation of the Company or any of its affiliated or related entities; or
conduct that, in the judgment of the Company creates a conflict of interest or
the appearance of a conflict of interest between Executive and the Company or
any of its affiliated or related entities.

7.5 This Agreement shall terminate automatically in the event of
Executive's death, without any obligation on the part of the Company to provide
severance benefits to Executive's estate. However, the Company will pay the cost
of continuation of existing group health insurance coverage for Executive's
spouse, if any, and eligible dependents covered at the time of Executive's death
for a period of up to six (6) months or such earlier date that the spouse and
eligible dependent(s)are eligible for comparable group health coverage or
Medicare (or in the Company's sole discretion, pay the cash equivalent of this
benefit).

7.6 The Company, in its sole discretion, may elect to terminate this
Agreement and Executive's employment in the event Executive is unable or
unwilling to perform the essential duties and responsibilities of his/her
position for a period of more than six months due to disability, without any
obligation on the part of the Company to provide severance benefits to
Executive. However, the Company will pay the cost of continuation of Executive's
existing group health insurance coverage for a period of up to six (6) months or
such earlier date that Executive is eligible for comparable group health
coverage or Medicare or, in the Company's sole discretion, pay the cash
equivalent of this benefit.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 3 of 8
<PAGE>

provided Executive remains in a position deemed by the Company to be at
substantially the same level (including compensation) as the position described
in Section 3 above, and provided that the location of employment of Executive
remains within 30 miles of downtown Beaverton, Oregon.

7.10 Severance benefits under Section 7 shall not be included as
compensation under any retirement plan maintained by the Company or an affiliate
unless the retirement plan provides otherwise.

7.11 Notwithstanding the foregoing, Executive shall not be eligible for
severance pay or shall forfeit any outstanding severance pay and benefits
amounts, as applicable, under this Section 7 if:

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 4 of 8
<PAGE>

7.11.5 Executive is eligible for severance pay and benefits under
Section 8 of this Agreement.

8. Change in Control.
-----------------

8.1 If, following a Change in Control (as hereinafter defined),
Executive's employment is terminated by the Company other than for cause within
12 months following a Change of Control or if Executive resigns from employment
following a material alternation in Executive's position that has a detrimental
impact on Executive (as hereinafter defined), Executive shall receive as
severance pay an amount equal to 18 months of Executive's base compensation and
a pro-rata portion of Executive's target bonus reflecting Executive's partial
year of service as of the date of termination. As an additional severance
benefit, the Company will pay up to 18 months of COBRA premiums or until
Executive becomes eligible for comparable group health coverage or Medicare,
whichever is earlier. As an additional severance benefit, the Company will
provide Executive with outplacement assistance with an outplacement provider of
the Company's choice, up to a maximum fee of twelve percent (12%) of Executive's
base compensation. Severance benefits shall not include payment in connection
with an award of any stock option or grant, the eligibility for which will be
governed solely by the terms of the Stock Plan. No other severance pay or
benefits shall be payable to Executive, including but not limited to severance
pay or benefits under Section 7 of this Agreement.

8.2 For the purposes of this Section 8, Change in Control shall occur if
any of the following applies:

8.2.1 Any person, as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the Exchange Act) (other than
the Company, any trustee or other fiduciary holding securities under an employee
benefit plan of the Company, or any company owned, directly or indirectly, by
the shareholders of the Company in substantially the same proportion as their
ownership of stock of the Company) is or becomes the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 51 percent or more of the combined voting
power of the Company's then outstanding securities;

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 5 of 8

<PAGE>

such merger of consolidation or (2) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which
no Person acquired more than 51 percent of the combined voting power of the
Company's then outstanding securities;

8.2.3 A tender or exchange offer is made for the common stock of the
Company (or securities convertible into common stock of the Company) and such
offer results in a portion of those securities being purchased and the offeror,
after the consummation of the offer, is the beneficial owner (as determined
pursuant to Section 13(d) of the Exchange Act), directly or indirectly, of
securities representing at least 51 percent of the voting power of outstanding
securities of the Company; or

8.2.4 The Company sells all or substantially all of its operating
assets to a buyer that is not a member of the Renaissance controlled group of
corporations.

8.3 For the purposes of this Section 8, there is a material alteration in
the employee's position that has a detrimental impact on the employee if:

8.3.1 Executive's principal work location is moved more than 30
miles;

8.3.2 Executive's salary and target bonus opportunity is reduced by
at least 15 percent of Executive's base salary and target bonus opportunity
before the change in compensation and the reduction is not the result of a
general reduction in compensation for reasons unrelated to Executive's
assignment; or

8.3.3 There is a material reduction in the scope of Executive's
responsibilities or authority.

8.4 Severance pay and benefits under Section 8 are subject to tax and other
applicable withholdings and deductions. Severance benefits, other than
outplacement assistance, shall be paid pro-rata on regular Company paydays.

8.5 In addition to the foregoing conditions, eligibility for and receipt of
severance benefits under Section 8 are subject to Executive executing and not
revoking a Separation Agreement and Release of Claims in a form provided to
Executive by the Company at the time of termination.

8.6 Severance benefits under Section 8 shall not be included as compensation
under any retirement plan maintained by the Company or an affiliate unless the
retirement plan provides otherwise.

8.7 Notwithstanding the foregoing, Executive shall not be eligible for
severance benefits.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 6 of 8

<PAGE>

or shall forfeit any outstanding severance pay and benefits amounts, as
applicable, under this Section 8 if:

8.7.1 Executive receives an offer of severance benefits under any other
severance plan or program maintained by the Company, or an affiliate of the
Company or enters into any individual severance agreement with the Company or an
affiliate that supersedes this Agreement or is terminated pursuant to Section 7
of this Agreement or voluntarily resigns from employment for any reason that
does not constitute a material alteration in Executive's position that has a
detrimental impact on Executive (as defined above).

8.7.2 Executive is involuntarily terminated for either gross misconduct or
gross negligence or conduct which indicates a reckless disregard for the
consequences and has a material adverse effect on the Company or an affiliate.

8.7.4 Executive fails to execute or breaches any agreement required by the
Company, including but not limited to cessation of benefits and repayment of
severance benefits in the event of rehire or reemployment by the Company or an
affiliate or in the event of any material breach of any required
confidentiality, nonsolicitation, nondisparagement, assistance to the Company
and assistance in defense of litigation agreements or a provision of the Release
of Claims.

9. General Provisions.
------------------

9.2 This Agreement shall be construed in accordance with and governed by the
laws of the State of Oregon.

9.3 Executive agrees that any dispute (1) concerning the interpretation or
construction of

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 7 of 8
<PAGE>

this Agreement, (2) relating to any compensation or benefits Executive may
claim, or (3) relating in any way to any claim by Executive for reinstatement or
reemployment by the Company after execution of this Agreement shall first be
submitted to confidential mediation before a mediator selected by the parties.
Should any dispute not be resolved through mediation, it shall be submitted and
settled exclusively by confidential arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association or such
comparable rules as may be agreed upon by the parties. The parties shall be
responsible for their own costs and legal fees in any mediation or arbitration
proceeding. Both parties agree that the procedures outlined in this Section are
the exclusive methods of dispute resolution.

9.5 The waiver of any breach of this Agreement by one party shall not
constitute waiver by the non-breaching party of any other breach of the
Agreement.

9.6 This Agreement is subject to, and conditioned on, ratification of its
terms by the Board of Directors of the Company.

RENAISSANCE HOLDINGS, INC.

By /s/ Irving J. Levin 8/5/99
--------------------------- -----------------------------------
Its: Chief Executive Officer Date

/s/ Charles B. Engelberg 8/5/99
---------------------------------------------------------------------
Executive Signature Date

Attachment A: Duties and Responsibilities of Executive
Attachment B: Target Bonus Participation Document
Attachment C: Confidentiality and Nonsolicitation Agreement.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 8 of 8
<PAGE>

[LOGO OF RENAISSANCE HOLDINGS, INC.]

JOB DESCRIPTION

TITLE: Senior Vice President and CFO

GRADE:

RANGE:

REPORTS TO: CEO

SUMMARY: The Senior Vice President and CFO plans, directs and
coordinates the financial strategies of the company.
The incumbent is responsible for providing strategic
financial leadership, analyzing and appraising the
effectiveness of asset and liability management,
portfolio acquisition, and securitization of assets and
other capital. The CFO is part of the Management
Committee of RHI.

DUTIES AND
RESPONSIBILITIES:

. Responsible for effective fiscal management and long range financial
planning for the organization. Provides guidance in budget planning
and development.

. Responsible for securing and managing capital funding.

. Negotiates contract and strategic partnerships.

. Participates in strategic business planning for the Company;
Establishes goals for financial and accounting units within RHI.

. Communicates financial plans and results throughout the company and
external constituencies.

. Educates, mentors and coaches direct reports to develop managerial
skills and abilities; Establishes succession plans for key positions.

ACCOUNTABILITY:
The Senior Vice President and CFO is accountable for
overseeing all financial strategies and tactics for the
organization. The position has a significant and
primary impact on overall financial state of the
business, including short and long term revenues and
profitability. Primary impacts occur through efficient
financial and accounting management and appropriate
management of the Company's capital spending. The
Senior Vice President and CFO
<PAGE>

must apply principles of logical and
conceptual thinking to a wide range of
intellectual and practical problems,
dealing with large number of variables to
determine a specific course of action on
the basis of need. Errors in judgment and
discretion could have a more than
significant impact on the Company's
profitability and growth goals.

QUALIFICATIONS:

Knowledge:

. Master's degree preferred along with extensive background in
portfolio management, long-range financial planning,
securitization and capital funding, preferably in the
financial services or in a high transaction processing
business industry.
. 10 to 15 years of experience in managing financial and
accounting functions within an organization, 5 to 7 years
experience in a senior management capacity.
. Experience directing business process design and
implementation of projects that provide tangible results such
as improved quality, productivity and business value.
. Knowledge and experience in applying ethical businesses
practices in day-to-day operations management and decision
making.
. Successful experience in profit center management.

Skills:

. Strong business analysis (quantitative) skills.
. Demonstrated problem-solving skills.
. Excellent written and verbal communication skills.
. Exceptionally strong leadership and interpersonal skills.
. Highly developed sense of business ethics.

Abilities:

. Judgment and ability to work with senior management on complex
technical organizational issues and corporate strategic
planning.
. Ability to make good business decisions in support of
strategic Company goals.
. Ability to work independently and as a team member to
professionally represent the Company.
. Ability to work in a fast-paced, entrepreneurial environment.
. Incumbent must have a process orientation to identify
problems, formulate solutions and implement improvements.
. Ability to think conceptually and manage detail.
. Strong work ethic; efficient, well organized, dependable,
self-starter, flexible.
. Ability to represent the Company internally and externally.

ESSENTIAL
FUNCTIONS:

<PAGE>

The incumbent must meet work deadlines, have regular attendance,
excellent oral and written communication skills, leadership
skills, excellent interpersonal skills, ability to work with a
team, ability to multi-task, use a PC and a computer terminal,
and the specialized telephone system. It requires access to all
areas of the office, and the ability to sit for extended periods
of time, periodically bending and twisting, and frequent
application of a negligible amount of force to lift, carry, push,
pull, or otherwise move objects. The incumbent must be able to
perform the essential functions of this position with or without
reasonable accommodation. The Company will provide reasonable
accommodation where necessary.

This is an exempt position.

X
- ---------- __________
Exempt Non-Exempt
(Check One)

Written By ___________________ Date _______

Approved By /s/ Charles B. Engelberg Date 11/23/99
--------------------------- --------
New 10/99

JD 00124

Job descriptions are not intended to be all- inclusive lists of all
responsibilities, skills, efforts or working conditions associated with a job.
While this job description is intended to be an accurate reflection of the job
requirements, management reserves the right to modify, add or remove duties from
particular jobs and assign other duties as necessary.
<PAGE>

Attachment B

[LOGO OF RENAISSANCE
HOLDINGS, INC.]

Memorandum
- -------------------------------------------------------------------------------

TO: RHI Management

FROM: Irving Levin / Senior Management Team

DATE: May 7, 1999

RE: 1999 Discretionary Bonus Program

This year we have modified the program. Our target net profit is $7.5 mm, and a
modest bonus pool will be funded once profits exceed $6.0mm. If we hit $6.0mm,
bonuses will be small and skewed toward staff, supervisors and lower-level
management. The pool will gain funding continuously over $6.0mm. At $7.5mm the
funding rate shall increase: profits above $7.5mm shall ensure a healthy bonus
pool. And just like last year, each dollar of profit adds to the bonus pool with
no limit.

Here is some additional discretionary bonus program information:
. Eligibility: All employees employed before July 1/st/ of the bonus year are
eligible to be considered for a bonus, with prorated amounts for less than
one full year of service. Employees must be working and on the payroll when
bonuses are distributed.
. Discretionary bonus award criteria falls into two categories:
Company performance (as outlined above) and individual performance in the
following areas:
-Overall job performance and contributions
-Dependability
-Major accomplishments
-Other factors (e.g., Special projects, etc)
. Achieving the profit goal does not ensure that any employee will receive a
bonus. Once the pool is funded, our existing process for determining bonuses
will be followed.
. The profit goals will change annually.
. The stock option and profit-sharing programs are not affected by the bonus
program.

I am available to discuss with any and all. Please share this information with
your employees.

<PAGE>

[LOGO OF Attachment C
RENAISSANCE
[LOGO OF HOLDINGS., INC.]
RENAISSANCE [LOGO OF
BANKCARD SERVICES] ORCHARD BANK]

Confidentiality, Non-solicitation and Non-competition Agreement
- ---------------------------------------------------------------

Renaissance Bankcard Services, Inc., Orchard Federal Savings Bank and
Renaissance Holdings, Inc. are recognized as industry leaders in the highly-
competitive credit card business. Accordingly, many companies actively seek to
obtain confidential information related to our companies. To guard against this,
and clarify our confidentiality requirements for employees, we are asking you to
enter into this Confidentiality, Non-solicitation and Non-competition Agreement
and to abide by its terms.

In consideration of my employment with Renaissance Bankcard Services, Inc.,
and/or Orchard Federal Savings Bank and/or Renaissance Holdings, Inc., I agree
to the following:

1. Confidentiality. I understand that as an employee I have had and/or will
-------------------
have access to proprietary information, trade secrets, and other
information treated by Renaissance Bankcard Services, Inc., Orchard Federal
Savings Bank and Renaissance Holdings, Inc. (individually or collectively,
the "Company") as Confidential Information, that such information is a
valuable asset of Company and that its disclosure or unauthorized use will
cause Company irreparable harm. As used in this Agreement, the term
"Confidential Information" means: (a) proprietary information of Company;
(b) information marked or designated by Company as confidential; (c)
information that is known to me to be treated by Company as confidential
and (d) information provided to Company by third parties which Company is
obligated to keep confidential. It also includes, but is not limited to,
trade secrets as defined under the Uniform Trade Secrets Act, all
information relating to Company's clients and customers including their
names, addresses and address lists, credit card, savings or other account
numbers, all information supplied by clients and customers, credit card
portfolios, profitability statistics and loss rates, credit card
transactions, scoring techniques, policies and reports, business
strategies, pricing, technology, methods, techniques, procedures, products,
costs, employee compensation, marketing plans, computer programs or
systems, inventions, developments, and trade secrets of every kind and
character. I agree that I will not disclose any Confidential Information to
any person, agency or court unless compelled to do so by law. I also will
not use Confidential Information for my own benefit or that of any other
person, corporation, government or other entity. If I am required by law to
disclose any Confidential Information, before doing so I will notify the
Director of Human Resources of the Company and provide a copy of the
subpoena, summons or other legal document. I agree that upon my separation
from employment (or earlier if requested by Company), I will return to
Company all originals and copies of documents and other materials in my
possession or control relating to Company or containing or derived from
Confidential Information. If requested, I agree to execute a written
certification satisfactory to Company to the effect that all such documents
and materials have been returned.

2. Non-solicitation of Employees. I agree that I will not solicit, divert
-----------------------------
or take away either the employment of any employees or customers of the
Company for a period of one (1) year from the date my employment with
Company ends. I specifically acknowledge and agree that the terms of this
provision are reasonable in every respect and in particular because of the
comprehensive and specialized nature of the Company's business.

Non-competition, Confidentiality and Non-solicitation Agreement
Page 1 of 2

<PAGE>

Exhibit 10.13(b)
----------------

Amendment and Continuation of Executive Compensation and Benefits
Agreement

Charles B. Engelberg The Executive
14542 Kruse Oaks Blvd.
Lake Oswego, OR 97035

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005

Household International, Inc. Household
2700 Sanders Road
Prospect Heights, IL 60070

1. "RCS" shall be substituted for the "Company" wherever appropriate.

2. Executive will receive a salary increase resulting in an annual salary of
$175,000.

5. During the course of Executive's performance under this Agreement,
Executive will receive and be exposed to confidential and proprietary
information relating to Household's its affiliates' business practices and
strategies ("Confidential Information"). Such Confidential Information may
include but shall not be limited to confidential and proprietary information
that is marked "Confidential" or its equivalent and the marketing and
customer support strategies, financial information, including sales, costs,
profits and pricing methods, internal organizations, employee lists and
customer lists of Household and its affiliates. At all times during the term
of employment and thereafter, Executive will hold in strictest confidence
and will not disclose or use any Confidential Information, except as such
disclosure or use may be required in connection with Executive's work for
Household or its affiliates. Notwithstanding the foregoing, "Confidential
Information" shall not be deemed to include information which Executive can
demonstrate is now, or hereafter becomes, through no act or failure to act
on Executive's part, generally known or publicly available.

7. With respect to his job description, Executive agrees that if he is no
longer "responsible for securing and managing capital funding" this change
will not, of itself, be considered either (1) a termination of employment
entitling Executive to a payment under Section 7.2 or (2) a material
alteration that has a detrimental impact entitling Executive to a payment
under Section 8.

Renaissance Holdings, Inc. Date: 12/1/99
-----------

By: /s/ Irving J. Levin
-------------------------------------
Irving J. Levin
Its Chief Executive Officer

Household International, Inc. Date: 12/1/99
-----------

By: /s/ S. N. Mehta
-------------------------------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Executive: Date: 12/1/99
-----------

/s/ Charles B. Engelberg
- ----------------------------------------

<PAGE>

EXHIBIT 10.14(a)

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT

Karen D. Frolich The Executive
11640 SW Oak Creek
Portland, OR 97219

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005-3363

1. Employment.
----------

The Company hereby employs Executive as its Chief Executive Officer of its
subsidiary (Orchard Bank FSB) and Executive hereby accepts this Executive
Compensation and Benefits Agreement in conjunction with his/her employment with
the Company.

2. Effective Date.
--------------

This Agreement is effective September 1, 1999 (the "Executive Date"), and
shall continue through August 31, 2002, unless extended by mutual agreement or
terminated earlier as hereinafter provided.

3. Duties and Responsibilities.
---------------------------

Executive will, during the term of this Agreement, faithfully and
diligently perform all such acts and duties and have such responsibilities and
furnish such services as the Chief Executive Officer of the subsidiary or other
duties, including but not limited to those listed in Attachment A hereto.
Executive will devote such time, energy, and skill to the business of the
Company as shall reasonably be required for the performance of his/her duties.

4. Salary and Bonus.
----------------

4.1 Salary. Executive will be paid a salary of not less than her current
------
salary of $135,000 on an annualized basis, payable on regular Company paydays.
Executive's annual salary shall be reviewed by the Company's Chief Executive
Officer and Board of Directors each year during the term of this Agreement for
adjustment as determined appropriate by the Board. Except as specifically stated
herein, Executive otherwise will receive the same Company benefits and be
subject to the same policies, practices, terms and conditions of employment as
are other regular Company employees.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 1 of 8
<PAGE>

5. Stock Option Grant.
------------------

6. Confidential Information and Nonsolicitation.
--------------------------------------------

Executive (shall execute/has executed) a Confidentiality and Nonsolicitation
Agreement in the form attached hereto as Attachment C which shall survive the
termination of this Agreement.

7. Termination and Severance.
-------------------------

7.1 Except as specifically provided for in this Agreement, Executive shall
not be eligible for severance pay or benefits under any policy, program, plan,
or practice of the Company.

7.2 If Executive's employment is terminated by the Company other than for
cause, as hereinafter defined, or pursuant to Sections 7.4 (death) or 7.6
(disability) or 8 (Change of Control) below, Executive shall receive as
severance pay an amount equal to 12 months of Executive's base compensation and
a pro-rata portion of Executive's target bonus reflecting Executive's partial
year of service as of the date of termination. As an additional severance
benefit. The Company will pay up to 12 months of COBRA premiums or until
Executive becomes eligible for comparable group health coverage of Medicare,
whichever is earlier. (At its sole discretion the Company may pay Executive the
cash equivalent of the COBRA benefit rather than payment of premiums on
Executive's behalf.)

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 2 of 8
<PAGE>

As an additional severance benefit, the Company will provide Executive with
outplacement assistance with an outplacement provider of the Company's choice,
up to a maximum fee of twelve percent (12%) of Executive's base compensation.
Severance benefits shall not include payment in connection with an award of any
stock option or grant, the eligibility for which will be governed solely by
the terms of the Stock Option Plan.

7.5 This Agreement shall terminate automatically in the event of
Executive's death, without any obligation on the part of the Company to provide
severance benefits to Executive's estate. However, the Company will pay the cost
of continuation of existing group health insurance coverage for Executive's
spouse, if any, and eligible dependents covered at the time of Executive's death
for a period of up to six (6) months or such earlier date that the spouse and
eligible dependent(s) are eligible for comparable group health coverage or
Medicare (or in the Company's sole discretion, pay the cash equivalent of this
benefit).

7.6 The Company, in its sole discretion, may elect to terminate this
Agreement and Executive's employment in the event Executive is unable or
unwilling to perform the essential duties and responsibilities of his/her
position for a period of more than six months due to disability, without any
obligation on the part of the Company to provide severance benefits to
Executive. However, the Company will pay the cost of continuation of Executive's
existing group health insurance coverage for a period of up to six (6) months or
such earlier date that Executive is eligible for comparable group health
coverage or Medicare or, in the Company's sole discretion, pay the cash
equivalent of this benefit.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 3 of 8
<PAGE>

7.10 Severance benefits under Section 7 shall not be included as
compensation under any retirement plan maintained by the Company or an affiliate
unless the retirement plan provides otherwise.

7.11 Notwithstanding the foregoing, Executive shall not be eligible for
severance pay or shall forfeit any outstanding severance pay and benefits
amounts, as applicable, under this Section 7 if:

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 4 of 8
<PAGE>

7.11.5 Executive is eligible for severance pay and benefits under
Section 8 of this Agreement.

8. Change in Control.
-----------------

8.1 If, following a Change in Control (as hereinafter defined),
Executive's employment is terminated by the Company other than for cause within
12 months following a Change of Control or if Executive resigns from employment
following a material alteration in Executive's position that has a detrimental
impact on Executive (as hereinafter defined), Executive shall receive as
severance pay an amount equal to 18 months of Executive's base compensation and
a pro-rata portion of Executive's target bonus reflecting Executive's partial
year of service as of the date of termination. As an additional severance
benefit, the Company will pay up to 18 months of COBRA premiums or until
Executive becomes eligible for comparable group health coverage or Medicare,
whichever is earlier. As an additional severance benefit, the Company will
provide Executive with outplacement assistance with an outplacement provider of
the Company's choice, up to a maximum fee of twelve percent (12%) of Executive's
base compensation. Severance benefits shall not include payment in connection
with an award of any stock option or grant, the eligibility for which will be
governed solely by the terms of the Stock Plan. No other severance pay or
benefits shall be payable to Executive, including but not limited to severance
pay or benefits under Section 7 of this Agreement.

8.2 For the purposes of this Section 8, Change in Control shall occur if
any of the following applies:

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 5 of 8

<PAGE>

such merger of consolidation or (2) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no
Person acquired more than 51 percent of the combined voting power of the
Company's then outstanding securities;

8.2.3 A tender or exchange offer is made for the common stock of the
Company (or securities convertible into common stock of the Company) and such
offer results in a portion of those securities being purchased and the offeror,
after the consummation of the offer, is the beneficial owner (as determined
pursuant to Section 13(d) of the Exchange Act), directly or indirectly, of
securities representing at least 51 percent of the voting power of outstanding
securities of the Company; or

8.2.4 The Company sells all or substantially all of its operating
assets to a buyer that is not a member of the Renaissance controlled group of
corporations.

8.3 For the purposes of this Section 8, there is a material alteration in
the employee's position that has a detrimental impact on the employee if:

8.3.1 Executive's principal work location is moved more than 30
miles;

8.3.2 Executive's salary and target bonus opportunity is reduced by
at least 15 percent of Executive's base salary and target bonus opportunity
before the change in compensation and the reduction is not the result of a
general reduction in compensation for reasons unrelated to Executive's
assignment; or

8.3.3 There is a material reduction in the scope of Executive's
responsibilities or authority. It is understood that Executive is current CEO of
Company subsidiary and also has responsibility for Corporate-wide Marketing. Any
assignment or re-assignment in which Executive either maintains title of CEO of
subsidiary, or is no longer an officer of such subsidiary but is an officer of
the Company with the rank of Senior Vice President or higher and with
responsibility for oversight of Sales or Marketing, shall not be considered a
material reduction in scope of Executive's responsibility or authority for
purposes of this Agreement.

8.4 Severance pay and benefits under Section 8 are subject to tax and other
applicable withholdings and deductions. Severance benefits, other than
outplacement assistance, shall be paid pro-rata on regular Company paydays.

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 6 of 8

<PAGE>

8.6 Severance benefits under Section 8 shall not be included as compensation
under any retirement plan maintained by the Company or an affiliate unless the
retirement plan provides otherwise.

8.7 Notwithstanding the foregoing, Executive shall not be eligible for
severance benefits or shall forfeit any outstanding severance pay and benefits
amounts, as applicable, under this Section 8 if:

8.7.4 Executive fails to execute or breaches any agreement required by
the Company, including but not limited to cessation of benefits and repayment of
severance benefits in the event of rehire or reemployment by the Company or an
affiliate or in the event of any material breach on any required
confidentiality, nonsolicitation, nondisparagement, assistance to the Company
and assistance in defense of litigation agreements or a provision of the Release
of Claims.

8.7.6 Executive accepts employment or enters into any business
relationship with, or becomes, or acquires ownership of more than a five percent
(5%) interest in a competitor of Company less than 18 months after termination
with the Company.

9. General Provisions.
------------------

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 7 of 8

<PAGE>

9.2 This Agreement shall be construed in accordance with and governed by the
laws of the State of Oregon.

9.5 The waiver of any breach of this Agreement by one party shall not
constitute waiver by the non-breaching party of any other breach of the
Agreement.

9.6 This Agreement is subject to, and conditioned on, ratification of its terms
by the Board of Directors of the Company.

RENAISSANCE HOLDINGS, INC.

By /s/ Irving J. Levin 8-16-99
------------------------- --------------
Its: Chief Executive Officer Date

/s/ Karen D. Frolich 8/16/99
- --------------------------------------------------------------------
Executive Signature Date

Attachment A: Duties and Responsibilities of Executive
Attachment B: Target Bonus Participation Document
Attachment C: Confidentiality and Nonsolicitation Agreement

EXECUTIVE COMPENSATION AND BENEFITS AGREEMENTS
Page 8 of 8

<PAGE>

[LOGO OF RENAISSANCE HOLDINGS, INC.]

JOB DESCRIPTION

TITLE: CEO of subsidiary Orchard Bank

REPORTS TO: CEO

SUMMARY: Responsible for directing subsidiary (Orchard
Bank) and Company-wide marketing.

LOCATION: Portland, OR

DUTIES AND
RESPONSIBILITIES:
Bank
----
. Responsible for maintaining strong relationships with
regulatory agencies.
. Effectively managing the human resources of the bank
including ensuring adequate and competent staffing and
succession planning for key management positions.
. Enabling the Bank's Board of Directors to fulfill its
governance function.
. Representing the bank at the Holding Company, and
externally through speaking engagements.
. Ensuring compliance with policies and law.
Marketing
---------
. Planning and directing marketing activities in
accordance with Company's goals and ethics.
. Ensuring that budgets, strategic plans, business
plans, and project plans are developed, approved and
utilized for identified targets of opportunity.
. Pursuing strong affiliations with other related or
external entities, and negotiating key contracts and
agreements on behalf of the Company and Bank.
. Developing and implementing policies and procedures to
document and control business practices.
. Mentoring key managers in the Bank and Company.
. Contributing to the establishment of Company direction,
policy and overall governance.

The above job duties must be performed with or without reasonable accommodation.

<PAGE>

ACCOUNTABILITY: Works independently with oversight from the CEO
of Company. Directly supervises the senior
management team of the Bank and serves Bank Board
of Directors. Position will be responsible for all
aspects of Bank management. Frequent internal and
external contact with all levels of employees and
subsidiary Board of Directors. Extensive external
contact with regulators, business owner/partners
and other banking professionals.

QUALIFICATIONS:
Knowledge:
. At least ten years of progressive experience in financial services
management.
. A BS or BA in Business Administration, or the equivalent in training
and experience.
. Specific knowledge of the sub-prime credit card business with general
knowledge of finance, marketing, compliance and consumer lending
functions.
. Decisive and results oriented.
. Capable of creative approaches to situations.
. Proven ability to identify, negotiate and maintain business
relationships.
. Prior experience in a rapidly growing business.
Skills:
. Excellent communication skills (writing, speaking, listening),
. Proven coaching/mentoring,
. Advanced interpersonal skills,
. Intermediate/advance analytical and quantitative Skills,
. Strong meeting management,
. Strong delegation and decision-making,
. Proven creative and strategic thinking/planning,
. Proven negotiations/influence skills,
. Budget-planning oversight,
. Intermediate to advanced PC skills in a Windows-based environment
Abilities:
. Ability to develop and communicate a vision.
. Ability to assume full responsibility for the organization.
. Ability to manage complex day to day operations.
. Ability to manage physical and financial resources.
. Ability to demonstrate sound judgment and discretion.
. Ability to advise the Board of Directors.
. Ability to advocate and promote the organization.
. Ability to adapt to rapid growth and manage the associated change.
. Ability to encourage creativity and innovation in employees.
. Ability to motivate and create development plan/growth path for
employees.
. Ability to instill company values in employees and throughout the
organization.
. Ability to mentor employees and teach others area expertise
knowledge/skill.
. Ability to be a leadership role model.

ESSENTIAL

<PAGE>

FUNCTIONS: The incumbent must meet work deadlines, have
regular attendance, good oral and written
communication skills, good interpersonal skills,
ability to work with a team, ability to multi-task,
use a PC and a computer terminal, and the
specialized telephone system. It requires access to
all areas of the office, and the ability to sit for
extended periods, periodic bending and twisting, and
frequent application of a negligible amount of force
to lift, carry, push, pull, or otherwise move
objects. The incumbent must be able to perform the
essential functions of this position with or without
reasonable accommodation. The Company will provide
reasonable accommodation where necessary.

This is an exempt position.

JD XXX
New: 11/98 Approved by /s/ K. D. Frolich Date 10/15/99
----------------------- --------

Job descriptions are not intended to be all inclusive lists of all
responsibilities, skills, efforts or working conditions associated with a
job. While this job description is intended to be an accurate reflection of
the job requirements, management reserves the right to modify, add or
remove duties from particular jobs and assign other duties as necessary.

<PAGE>

Attachment B

[LOGO OF RENAISSANCE
HOLDINGS, INC.]

Memorandum
- -------------------------------------------------------------------------------

TO: RHI Management

FROM: Irving Levin / Senior Management Team

DATE: May 7, 1999

RE: 1999 Discretionary Bonus Program

We have made a significant step toward hitting our target--we're 57% there after
the first quarter. Even though we are more cautious about the next three
quarters, we're still confident we can exceed $7.5mm. However, reiteration
earlier comments, bonuses can vary widely from year to year, and that none of us
should count our chickens. Let's go out and make them hatch.

I am available to discuss with any and all. Please share this information with
your employees.
<PAGE>

Attachment C

Renaissance Renaissance
Bankcard Services Holdings, Inc.

[LOGO OF RENAISSANCE [LOGO OF
BANKCARD SERVICES] ORCHARD BANK]

Confidentiality, Non-solicitation and Non-competition Agreement
- ---------------------------------------------------------------

Renaissance Bankcard Services, Inc., Orchard Federal Savings Bank and
Renaissance Holdings, Inc. are recognized as industry leaders in the
highly-competitive credit card business. Accordingly, many companies actively
seek to obtain confidential information related to our companies. To guard
against this, and clarify our confidentiality requirements for employees, we are
asking you to enter into this Confidentiality, Non-solicitation and
Non-competition Agreement and to abide by its terms.

In consideration of my employment with Renaissance Bankcard Services, Inc.,
and/or Orchard Federal Savings Bank and/or Renaissance Holdings, Inc., I agree
to the following:

1. Confidentiality. I understand that as an employee I have had and/or
--------------------
will have access to proprietary information, trade secrets, and other
information treated by Renaissance Bankcard Services, Inc., Orchard Federal
Savings Bank and Renaissance Holdings, Inc. (individually or collectively,
the "Company") as Confidential Information, that such information is a
valuable asset of Company and that its disclosure or unauthorized use will
cause Company irreparable harm. As used in this Agreement the term
"Confidential Information" means: (a) proprietary information of Company;
(b) information marked or designated by Company as confidential; (c)
information that is known to me to be treated by Company as confidential
and (d) information provided to Company by third parties which Company is
obligated to keep confidential. It also includes, but is not limited to,
trade secrets as defined under the Uniform Trade Secrets Act, all
information relating to Company's clients and customers including their
names, addresses and address lists, credit card savings or other account
numbers, all information supplied by clients and customers, credit card
portfolios, profitability statistics and loss rates, credit card
transactions, scoring techniques, policies and reports, business
strategies, pricing, technology, methods, techniques, procedures, products,
costs, employee compensation, marketing plans, computer programs or
systems, inventions, developments, and trade secrets of every kind and
character. I agree that I will not disclose any Confidential Information to
any person, agency or court unless compelled to do so by law. I also will
not use Confidential Information for my own benefit or that of any other
person, corporation, government or other entity. If I am required by law to
disclose any Confidential Information, before doing so I will notify the
Director of Human Resources of the Company and provide a copy of the
subpoena, summons or other legal document. I agree that upon my separation
from employment (or earlier if requested by Company), I will return to
Company all originals and copies of documents and other materials in my
possession or control relating to Company or containing or derived from
Confidential Information. If requested, I agree to execute a written
certification satisfactory to Company to the effect that all such documents
and materials have been returned.

2. Non-solicitation of Employees. I agree that I will not solicit, divert
----------------------------------
or take away either the employment of any employees or customers of the
Company for a period of one (1) year from the date my employment with
Company ends. I specifically acknowledge and agree that the terms of this
provision are reasonable in every respect and in particular because of the
comprehensive and specialized nature of the Company's business.

Non-competition Confidentiality and Non-solicitation Agreement
Page 1 of 2

<PAGE>

Exhibit 10.14(b)
----------------

Amendment and Continuation of Executive Compensation and Benefits
Agreement

Karen D. Frolich The Executive
11640 SW Oak Creek
Portland, OR 97219

Renaissance Holdings, Inc. The Company
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, OR 97005

Household International, Inc. Household
2700 Sanders Road
Prospect Heights, IL 60070

1. "RCS" shall be substituted for the "Company" wherever appropriate.

2. Executive will receive a salary increase resulting in an annual salary of
$145,800.

3. Executive will be eligible for an annual bonus under the Household
International Corporation Executive Bonus Plan and any successor or
substitute plan or plans (the "Bonus Plan") having a target value equal to
thirty percent (30%) and a maximum value of fifty percent (50%) of
Executive's annualized salary as of the end of the period in which the bonus
is earned. The amount of bonus for any year that Executive actually
receives, if any, will depend on the achievement of the corporation and
Executive individual goals established for that year and the terms of the
Bonus Plan. Executive's bonus will be prorated based on the number of
elapsed months in the performance period in the case of death, disability
(as described in paragraph 7.6), or retirement under the Household
Retirement Income Plan or any successor tax qualified defined benefit plan.
This bonus shall be in place of any bonus under the Company's Management
Incentive Premium or Management Incentive Plan.

Renaissance Holdings, Inc. Date: 12/1/99
-----------

By: /s/ Irving J. Levin
----------------------------------
Irving J. Levin
Its Chief Executive Officer

Household International, Inc. Date: 12/1/99
-----------

By: /s/ S. N. Mehta
----------------------------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Executive: Date: 12/2/99
-----------

/s/ Karen D. Frolich
- ---------------------------------------

<PAGE>

Exhibit 10.15
-------------
November , 1999

Irving J. Levin
9400 S.W. Beaverton-Hillsdale Highway
Beaverton, OR 97005-3363

Dear Mr. Levin:

SUBJECT: Employment Agreement
- -----------------------------

We wish you to accept employment with Renaissance Credit Services, Inc., a
Delaware Corporation (the "Corporation"), a subsidiary of Household
International, Inc. ("Household"), as of the closing date ("Closing Date") of
the merger of Renaissance Holdings, Inc., into the Corporation and to provide
you with fair and equitable treatment along with a competitive compensation
package. Also, we wish to assure your continued attention to your duties without
any possible distraction arising out of uncertain personal circumstances in a
change in control environment. We recognize that in the event of a change in
control of the Corporation or Household it is likely that your duties and
responsibilities would be substantially altered.

1. a. Beginning with the Closing Date, you will be employed by the
Corporation as President, Chairman of the Board and Chief Executive
Officer. In that capacity you are entitled to the following:

i. A minimum annual salary of $270,000;

ii. An annual bonus having a targeted value equal to fifty percent
(50%) and a maximum value of one hundred percent (100%) of your
annualized salary as of the end of the period in which the bonus
is earned. The amount of bonus for any year that you actually
receive, if any, will depend on the achievement of the
Corporation and your individual goals established for that year
and the terms of the Household International Corporation
Executive Bonus Plan, and any successor or substitute plan or
plans (the "Bonus Plan"). Your bonus will be prorated based on
the number of elapsed months in the performance period in the
case of death, permanent and total disability (as described in
Section 4(a) (iii)), or retirement under the Household Retirement
Income Plan or any successor tax qualified defined benefit
pension plan;

iii. An annual special incentive payment in accordance with the
provisions of the Household International Renaissance Incentive
Compensation
<PAGE>

Plan as referred to in the Merger Agreement with Renaissance
Holdings, Inc.;

iv. Continuation of the loan forgiveness program in effect as of
November 1, 1999 with respect to promissory notes executed by you
and dated July 30, 1996 and May 30, 1995;

v. Other compensation, benefits, and perquisites as described in,
and in accordance with, Household's compensation, benefit, and
perquisite plans (the "Plans") applicable to senior executives of
Household in Band D; and

vi. A sabbatical leave of 12 weeks beginning no sooner than June 1,
2001 which will be in place of any TOP days for the calendar year
in which the sabbatical leave occurs. Annual salary shall
continue during such sabbatical leave, but any annual bonus or
other incentive payment shall be pro-rated to reflect the
sabbatical leave in excess of the TOP days for such year.

b. You will be eligible for future grants of stock options and/or
restricted stock rights under the Household International 1996 Long-
Term Executive Incentive Compensation Plan, and any successor or
substitute plan or plans (the "Long-Term Plan"). The amount and
frequency of future grants shall be solely determined by Household's
Board of Directors and shall reflect your level of responsibility with
Household or its affiliates.

2. Subject to termination as provided herein, the initial term of this
Agreement shall extend until December 31, 2002. This Agreement may also be
terminated prior to that time by Household or you upon ninety (90) days
prior written notice and with the consent of both parties to this
Agreement. In addition, your employment under the Agreement may be
terminated for cause by the Corporation upon written notice to you. For
purposes of this Agreement, cause for termination includes, but is not
limited to, the following types of conduct and circumstances: (a)
commission of an act materially and demonstrably detrimental to the
financial condition and/or goodwill of the Household or any of its
subsidiaries, which act constitutes gross negligence or willful misconduct
in the performance of your material duties to the Household or any of its
subsidiaries, or (b) commission of any material act of dishonesty or breach
of trust resulting or intended to result in your material personal gain or
enrichment at the expense of Household or any of its subsidiaries, or (c)
conviction of a felony involving moral turpitude, but specifically
excluding any conviction based entirely on vicarious liability. No act or
failure to act will be considered "willful" unless it is done, or omitted
to be done, in bad faith or without reasonable belief that your action or
omission was in the best interests of the Household. In addition, no act or
omission will constitute cause unless the Household has given detailed
written notice thereof to you and, where remedial action is feasible, you
then fail to remedy that act or omission within a reasonable time after
receiving such notice.
<PAGE>

3. During your employment with the Corporation or Household (or any affiliate
of Household) you will devote your reasonably full business time and
energies to the faithful and diligent performance of the duties inherent
in, and implied by, your position.

4. In consideration of your employment with the Corporation or Household (or
any affiliate of Household), it is mutually agreed that:

a. In the event your employment is terminated during the term of this
Agreement by Household or the Corporation or such Household affiliate
for any reason other than:

i. cause as referred to in paragraph 2 above;

ii. death; or

iii. inability, for reasons of disability, reasonably to
perform your duties for six consecutive months;

b. In the event that during the term of this Agreement you resign your
position with the Corporation or Household or such Household affiliate
because, within 6 whole months prior to your resignation, any
successor to Household, by acquisition of stock or substantially all
of the assets, by merger or otherwise, repudiated this Employment
Agreement; or

c. In the event that during the term of this Agreement you resign your
position with the Corporation, Household and all Household affiliates
because, within 6 months prior to your resignation, one or more of the
following occurred:

(i) your annual salary was reduced;

(ii) your annual target bonus or your status or responsibilities
were substantially changed;

(iii) your benefits or perquisites were reduced in a manner
inconsistent with the treatment of benefits and perquisites
for a majority of senior executives of Household;

(iv) you were reassigned without your consent to a geographical
area outside of the Portland, Oregon area;

(v) any successor to the Corporation by acquisition of stock or
substantially all of the assets, by merger or otherwise,
failed to expressly adopt or otherwise repudiated this
Employment Agreement; or

(vi) over 50% of the Corporation's stock is not held by
Household, or Household sells substantially all of the
assets of, liquidates, or otherwise disposes of, the
Corporation;

the Corporation (or Household or its affiliate) shall be required, and
hereby agrees, to make promptly a lump sum cash payment to you in an amount
equal to
<PAGE>

200% of your then annual salary plus 200% of the annual bonus described in
subparagraph 1 a (ii) for the most recent completed calendar year or the
average for the most recent two completed calendar years if more than one
year has been completed. If less than one year has been completed the cash
payment should be 200% of your annual salary plus $200,000 (200% of
$100,000). This payment shall be in addition to all other compensation and
benefits accrued to the date of termination of employment. Payments under
this paragraph 4 are in lieu of any other severance or benefit continuation
that Household may provide for its employees other than as required by law.

5. You are not required to mitigate the amount of any payments to be made by
the Corporation, Household or any affiliate thereof pursuant to this
Agreement by seeking other employment, or otherwise, nor shall the amount
of any payments provided for in this Agreement be reduced by any
compensation earned by you as the result of self-employment or your
employment with Household, the Corporation or any affiliate thereof.

6. If any part or all of the amounts to be paid to you constitute "Parachute
Payments" within the meaning of section 280G (b) (2) (A) of the Internal
Revenue Code of 1986, as amended (the "Code"), and a reduction of the
amount by 10% or less would totally avoid the imposition of any Excise Tax,
such amounts shall be reduced so that the aggregate present value of the
amounts constituting the Parachute Payments will be equal to 299% of your
"annualized includible compensation for the base period," as such term is
defined in section 280G (d) (1) of the Code. For the purpose of this
paragraph 6, present value shall be determined in accordance with section
280G (d) (4) of the Code.

7. If a dispute arises regarding the termination of your employment or the
interpretation or enforcement of this Agreement and you obtain a final
judgment in your favor from a court of competent jurisdiction from which no
appeal may be taken, whether because the time to do so has expired or
otherwise, or your claim is settled by Household, the Corporation or its
successor prior to the rendering of such judgment, all reasonable legal and
other professional fees and expenses incurred by you in contesting or
disputing any such termination or in seeking to obtain or enforce any right
or benefit provided for in this Agreement or in otherwise pursuing your
claim will be promptly paid by Household, the Corporation or its successor
with interest thereon at the highest statutory rate of your state of
domicile for interest on judgments against private parties.

8. During the course of your performance under this Agreement, you will
receive and be exposed to confidential and proprietary information relating
to Household's and the Corporation's business practices and strategies
("Confidential Information"). Such Confidential Information may include but
shall not be limited to confidential and proprietary information that is
marked "Confidential" or its equivalent and the Corporation's marketing and
customer support strategies, financial information,
<PAGE>

including sales, costs, profits and pricing methods, internal organization,
employee lists and customer lists. At all times during the term of
employment and thereafter, you will hold in strictest confidence and will
not disclose or use any Confidential Information, except as such disclosure
or use may be required in connection with your work for the Corporation or
Household. Notwithstanding the foregoing, "Confidential Information" shall
not be deemed to include information which you can demonstrate is now, or
hereafter becomes, through no act or failure to act on your part, generally
known or publicly available.

9. For the period ending one (1) year after the termination of this Agreement
or after your termination of employment, whichever is later, you will not
solicit customers of the Corporation or Household in connection with the
offering of financial services that might compete with Household current or
proposed offerings nor solicit to hire any employee of the Corporation or
Household which would result in a termination of his or her employment with
the Corporation or Household in order to join any company or organization
in which you have an interest, financially or otherwise.

10. The parties intend that this Agreement shall supersede any employment
agreement entered into by and between you and Renaissance Holdings, Inc.
and/or any subsidiary or affiliate thereof, including the agreement made as
of July 1, 1996 with Renaissance Bankcard Services.

11. The provisions of this Agreement shall be construed, to the extent
possible, so as to guarantee their enforceability. In case any one or more
of the provisions contained in this Agreement shall, for any reason, be
held to be invalid, illegal, or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other
provision of this Agreement, and this Agreement shall be construed as if
such invalid, illegal, or unenforceable provision had never been contained
in it.

12. Any successor to the Household or the Corporation, by acquisition of stock
or substantially all of the assets, by merger or otherwise, shall be
required to adopt and abide by the terms of this Agreement. This Agreement,
and any rights to receive payments hereunder, may not be transferred,
assigned or alienated by you.

13. All benefits under this Agreement shall be general obligations of the
Corporation or Household which shall not require the segregation of any
funds or property. Notwithstanding the foregoing, in the discretion of the
Corporation or Household, the Corporation or Household may establish a
grantor trust or other vehicle to assist it in meeting its obligations
hereunder, but any such trust or other vehicle shall not create a funded
account or security interest for you.

14. This Agreement may only be amended or terminated by written agreement,
signed by both of the parties. It is agreed that Household may assign this
Agreement to the Corporation or any of its affiliates, but such assignment
shall not release Household or the Corporation from their obligations
hereunder.
<PAGE>

15. Except as to any controversy or claim which you elect by written notice to
the Corporation to have adjudicated by a court of competent jurisdiction,
any controversy or claim arising out of or relating to this Agreement or
breach hereof shall be settled by mediation or arbitration in Chicago,
Illinois in accordance with the laws of the State of Illinois. The
arbitration shall be conducted in accordance with the rules of the American
Arbitration Association. The costs and expenses of the arbitrator(s) shall
be borne by the Corporation. The award rendered by the arbitrator(s) shall
be binding upon the parties. Judgment upon the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction.

16. This Agreement may be executed by the parties hereto in two (2) or more
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall constitute one and the same instrument, and all
signatures need not appear on any one counterpart.

17. This Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of Illinois, other that the conflict of
laws provisions of such laws.

18. If any provision of this Agreement shall be adjudged by any court of
competent jurisdiction to be invalid or unenforceable for any reason, such
judgment shall not affect, impair, or invalidate the remainder of this
Agreement. Furthermore, if the scope of any restriction or requirement
contained in this Agreement is too broad to permit enforcement of such
restriction or requirement to its full extent, then such restriction or
requirement shall be enforced to the maximum extent permitted by law, and
you agree that any court of competent jurisdiction may so modify such scope
in any proceeding brought to enforce such restriction or requirement.

19. All notices, requests, demands and other communications hereunder shall be
in writing and shall be deemed to have been duly given if delivered by hand
or by recognized commercial delivery service or if mailed within the United
States by first class certified mail, return receipt requested, postage
prepaid, addressed as follows:

(1) If to Household or the Corporation, to:

Household International, Inc.
2700 Sanders Road
Prospect Heights, IL 60070
Attention: Senior Vice-President-Human Resources

(2) If to you, to:

Irving J. Levin
9400 S.W. Beaverton-Hillsdale Highway
<PAGE>

Beaverton, OR 97005-3363

Such addresses may be changed by written notice sent to the other party at the
last recorded address of that party.

20. The Corporation shall provide for the withholding of any taxes required to
be withheld by federal, state, or local law with respect to any payment in
cash, shares of stock and/or other property made by or on behalf of the
Corporation to or for your benefit under this Agreement or otherwise. The
Corporation may, at its option; (a) withhold such taxes from any cash
payments owing from the Corporation to you under this or any other
agreement, (b) require you to pay to the Corporation in cash such amounts
as may be required to satisfy such withholding obligations and/or (c) make
other satisfactory arrangements with you to satisfy such withholding
obligations.

Our signatures below indicate our mutual agreement and acceptance of the
foregoing terms and provisions, all as of the date first above set forth.

Sincerely,

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta
------------------------------------
Siddharth N. (Bobby) Mehta
Group Executive

/s/ Irving J. Levin
------------------------------------
Irving J. Levin

<PAGE>

Exhibit 10.16
-------------

NON-COMPETITION AGREEMENT
-------------------------

It is contemplated that Renaissance Holdings, Inc. ("RHI") will be merged into
Renaissance Credit Services, Inc., a subsidiary of Household International, Inc.
("Household"), and Shareholder will subsequently hold Household stock instead of
RHI stock. Shareholder will be actively involved in the management of the
business previously carried on by RHI. In consideration for the increased
compensation and other benefits Shareholder will receive in connection with the
merger, the parties to this Agreement hereby agree as follows:

1. Effective as of the closing date of the merger and until December 31, 2002
Shareholder shall not invest or engage in any business which is principally
a sub-prime credit card consumer lender within the United States or Canada
(the "Competitor"), or accept employment with or render services to any
Competitor within the United States or Canada. Notwithstanding the
foregoing, Shareholder will not be deemed to have invested in or be engaged
directly or indirectly in any business in contravention of the preceding
sentence if Shareholder participates in any such business solely as a
passive investor of up to one percent (1%) of the equity securities of a
company or partnership, the securities of which are publicly traded.

2. The provisions of this Agreement shall be construed, to the extent possible,
so as to guarantee their enforceability. In case any one or more of the
provisions contained in the Agreement shall, for any reason, be held to be
invalid, illegal, or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of this
Agreement. Furthermore, if the scope of any restriction or requirement
contained in this Agreement is too broad to permit enforcement of such
restriction or requirement to its full extent, then such restriction or
requirement shall be enforced to the maximum extent permitted by law, and
the parties agree to accept as binding any such modification made by the
arbitrator or court of competent jurisdiction in any proceeding brought to
enforce such restriction or requirement.

3. Subject to paragraph 4 below, any controversy or claim arising out of or
relating to this Agreement or breach hereof shall be settled by mediation or
arbitration in Chicago, Illinois in accordance with the laws of the State of
Illinois, without regard to any conflict of laws rules in Illinois. The
arbitration shall be conducted in accordance with the rules of the American
Arbitration Association. The arbitrator(s) shall be constrained to apply
only the laws of the state of Illinois (other than Illinois' conflict of
laws provision) and shall not apply the laws of any other state or forum.

4. In those cases where money damages may not be a sufficient remedy for any
breach of this Agreement, Household and the Shareholder shall be entitled to

1
<PAGE>

equitable relief, including injunction, in addition to all other remedies
available at law or equity to Household and the Shareholder.

5. This Agreement may only be amended or terminated by written agreement,
signed by both of the parties.

6. This Agreement may be executed by the parties hereto in two (2) or more
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall constitute one and the same instrument, and all
signatures need not appear on any one counterpart.

7. This Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of Illinois, other than the conflict of
laws provisions of such laws.

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta Date: December 1, 1999
--------------------------- ----------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Shareholder:

/s/ Irving J. Levin
--------------------------------

<PAGE>

Exhibit 10.17
-------------

NON-COMPETITION AGREEMENT
-------------------------

4. In those cases where money damages may not be a sufficient remedy for any
breach of this Agreement, Household and the Shareholder shall be entitled to

1
<PAGE>

equitable relief, including injunction, in addition to all other remedies
available at law or equity to Household and the Shareholder.

5. This Agreement may only be amended or terminated by written agreement,
signed by both of the parties.

7. This Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of Illinois, other than the conflict of
laws provisions of such laws.

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta Date: December 1, 1999
--------------------------- ----------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Shareholder:

/s/ Charles B. Engelberg
--------------------------------

<PAGE>

Exhibit 10.18
-------------

NON-COMPETITION AGREEMENT
-------------------------

4. In those cases where money damages may not be a sufficient remedy for any
breach of this Agreement, Household and the Shareholder shall be entitled to

1
<PAGE>

equitable relief, including injunction, in addition to all other remedies
available at law or equity to Household and the Shareholder.

5. This Agreement may only be amended or terminated by written agreement,
signed by both of the parties.

7. This Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of Illinois, other than the conflict of
laws provisions of such laws.

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta Date: December 1, 1999
--------------------------- ----------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Shareholder:

/s/ Karen D. Frolich
--------------------------------

<PAGE>

Exhibit 10.19
-------------

NON-COMPETITION AGREEMENT
-------------------------

4. In those cases where money damages may not be a sufficient remedy for any
breach of this Agreement, Household and the Shareholder shall be entitled to

1
<PAGE>

equitable relief, including injunction, in addition to all other remedies
available at law or equity to Household and the Shareholder.

5. This Agreement may only be amended or terminated by written agreement,
signed by both of the parties.

7. This Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of Illinois, other than the conflict of
laws provisions of such laws.

HOUSEHOLD INTERNATIONAL, INC.

By: /s/ S. N. Mehta Date: December 1, 1999
--------------------------- ----------------
Siddharth N. (Bobby) Mehta
Its Group Executive

Shareholder:

/s/ George F. Alexander
--------------------------------

<PAGE>

Exhibit 23.2
------------

The Board of Directors
Renaissance Holdings, Inc.:

We consent to the use of our report dated March 12, 1999 with respect to the
consolidated balance sheets of Renaissance Holdings, Inc. and subsidiaries as of
December 31, 1998 and 1997, and the related consolidated statements of income,
shareholders' equity and comprehensive income and cash flows for each of the
years in the three-year period ended December 31, 1998, which report appears in
the registration statement on Form S-4 of Household International, Inc. filed
with the Securities and Exchange Commission on or about December 28, 1999. We
also consent to the reference to our firm under the heading "Experts" in the
Prospectus/Proxy Statement.

KPMG LLP

Portland, Oregon
December 28, 1999

<PAGE>

[WILLIAM BLAIR & COMPANY, LLC]

EXHIBIT 23.5

December 28, 1999

Board of Directors
Renaissance Holdings, Inc.
9400 SW Beaverton-Hillsdale Hwy.
Beaverton, Oregon 97005-3363

Members of the Board:

We hereby consent to the use of our opinion letter to the Board of Directors of
Renaissance Holdings, Inc. ("Renaissance"), included as Annex B to the
Prospectus and Proxy Statement which forms a part of the Registration Statement
on Form S-4 of Household International, Inc., and to the references to us in
Such Prospectus and Proxy Statement in the cover letter to be signed by Irving
J. Levin, Chief Executive Officer of Renaissance, and under the captions
"Summary - Fairness Opinion of Renaissance Financial Advisor," "The Merger -
Background of the Merger; Renaissance Reasons for the Merger", "- Material
Contacts and Board Deliberations" and "- Opinion of Renaissance's Financial
Advisor". In giving such consent, we do not admit that we come within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, or the rules and regulations of the Securities and
Exchange Commission thereunder, nor do we thereby admit that we are experts with
respect to any part of such Registration Statement within the meaning of the
term "experts" as used in the Securities Act of 1933, as amended, or the rules
and regulations of the Securities and Exchange Commission thereunder.

Very truly yours,

WILLIAM BLAIR & COMPANY LLC

/s/ William Blair & Company, L.L.C.
- -----------------------------------
Name: Christopher Cotter
Title: Principal