<PAGE>
Registration No. 333-72453
Filed pursuant to rule 424(b)(5)
SUBJECT TO COMPLETION, DATED FEBRUARY 21, 2000
PRELIMINARY PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED MARCH 3, 1999
$1,500,000,000
Household Finance Corporation
% Notes due March , 200
---------
We will pay interest on the Notes on each March and September . The
first interest payment will be made on September , 2000. We may not redeem
the Notes prior to their maturity on March , 200 unless certain events occur
involving United States taxation. There is no sinking fund for the Notes.
We have applied to list the Notes on the Luxembourg Stock Exchange.
<TABLE>
<CAPTION>
Underwriting
Price to Discounts and Proceeds to
Public (1) Commissions Company (1)
------------ ------------- ------------
<S> <C> <C> <C>
Per Note................................ % % %
Total................................... $ $ $
</TABLE>
(1)Plus accrued interest, if any, from March , 2000.
Delivery of the Notes, in book-entry form only, will be made through The
Depository Trust Company on or about March , 2000. The Notes have been
approved for clearance through the Clearstream Luxembourg (formerly Cedelbank)
and Euroclear Systems.
Neither the Securities and Exchange Commission nor any state securities
commission nor the Luxembourg Stock Exchange has approved or disapproved of
these Notes or determined if this prospectus supplement or the prospectus to
which it relates is truthful or complete. Any representation to the contrary is
a criminal offense.
Joint Bookrunners
Chase Securities Inc. Credit Suisse First Boston
The date of this prospectus supplement is March , 2000.
This prospectus supplement relates to an effective registration statement
under the Securities Act of 1933, but is not complete and may be changed. This
prospectus is not an offer to sell these securities and is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
<PAGE>
------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page Page
---- ----
Prospectus Supplement Prospectus
<S> <C> <C> <C>
Use of Proceeds...................... S-3 About This Prospectus............... 2
Ratio of Earnings to Fixed Charges... S-3 Where You Can Find More
Capitalization of HFC................ S-3 Information........................ 2
Selected Financial Information of Special Note Regarding Forward-
HFC................................. S-4 Looking Statements................. 2
Description of Notes................. S-6 Household Finance Corporation....... 3
Underwriting......................... S-10 Use of Proceeds..................... 3
Notice to Canadian Residents......... S-12 Ratio of Earnings to Fixed Charges.. 3
Legal Opinions....................... S-13 Description of Debt Securities...... 4
Experts.............................. S-13 Description of Warrants............. 13
General Information.................. S-13 Certain United States Tax
Documentation Requirements......... 14
United States Taxation of Non-United
States Persons..................... 16
Plan of Distribution................ 18
ERISA Matters....................... 18
Legal Opinions...................... 19
Experts............................. 19
</TABLE>
------------
You should rely only on the information contained or incorporated by
reference in this Prospectus Supplement and the accompanying Prospectus. The
Company has not authorized anyone to provide you with information different
from that contained in this Prospectus Supplement and the accompanying
Prospectus. This Prospectus Supplement and the accompanying Prospectus may
only be used where it is legal to sell these securities. The information
contained in this Prospectus Supplement and the accompanying Prospectus is
accurate only as of the date of this Prospectus Supplement and the date of the
accompanying Prospectus, regardless of the time of delivery of this Prospectus
Supplement or any sales of the Notes.
In this Prospectus Supplement and the accompanying Prospectus, the
"Company," "HFC" and "we" refer to Household Finance Corporation.
The Notes are offered globally for sale in those jurisdictions in the
United States, Canada, Europe, Asia and elsewhere where it is lawful to make
such offers. See "Underwriting."
This Prospectus Supplement and the accompanying Prospectus include
particulars given in compliance with the rules governing the listing of
securities on the Luxembourg Stock Exchange for the purpose of giving
information with regard to the Company. The Company accepts responsibility for
the information contained in this Prospectus Supplement and the accompanying
Prospectus and confirms, having made all reasonable inquiries, that to the
best of its knowledge and belief there are no other facts the omission of
which would make any statement herein or in the Prospectus misleading in any
material respect.
The distribution of this Prospectus Supplement and Prospectus and the
offering of the Notes in certain jurisdictions may be restricted by law.
Persons into whose possession this Prospectus Supplement and the Prospectus
come should inform themselves about and observe any such restrictions. This
Prospectus Supplement and the Prospectus do not constitute, and may not be
used in connection with, an offer or solicitation by anyone in any
jurisdiction in which such offer or solicitation is not authorized or in which
the person making such offer
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or solicitation is not qualified to do so or to any person to whom it is
unlawful to make such offer or solicitation. See "Underwriting."
References herein to "$" and "dollars" are to the currency of the United
States.
HFC will provide without charge to each person (including any beneficial
owner), on the written or oral request of any such person, a copy of any or
all documents referred to under the heading "Where You Can Find More
Information" in the accompanying Prospectus (other than exhibits to such
documents). Requests should be directed to: Household Finance Corporation,
2700 Sanders Road, Prospect Heights, Illinois 60070, Attention: Office of the
Secretary, Telephone: 847-564-5000. In addition, such documents are also
available free of charge at the office of Banque Internationale a Luxembourg
societe anonyme, 69, route d' Esch, L-2953 Luxembourg.
USE OF PROCEEDS
HFC will apply the net proceeds (estimated to be approximately
$ ) from the sale of the Notes to its general funds to be used in
its financial services business, including the funding of investments in, or
extensions of credit to, affiliates of HFC. Pending such applications, the net
proceeds will be used initially to reduce outstanding commercial paper of HFC.
The proceeds of such commercial paper are used in connection with HFC's
financial services business.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for the year ended December 31, 1999
was 1.72. See "Ratio of Earnings to Fixed Charges" in the accompanying
Prospectus for additional information.
CAPITALIZATION OF HFC
The following table sets forth the unaudited consolidated capitalization of
HFC at December 31, 1999. The table should be read in conjunction with HFC's
consolidated financial statements and notes thereto included in the documents
incorporated by reference herein. See "Where You Can Find More Information" in
the accompanying Prospectus. All amounts are stated in millions of U.S.
dollars. Since December 31, 1999 there has been no material change in the
consolidated capitalization of HFC.
<TABLE>
<CAPTION>
December 31,
1999
-------------
<S> <C>
Commercial paper, bank and other borrowings...................... $ 8,780.2
Senior and senior subordinated debt (with original maturities
over one year) (1).............................................. 30,383.6
---------
Total debt....................................................... 39,163.8
---------
Common shareholder's equity:
Common stock, $1.00 par value, 1,000 shares authorized, issued
and outstanding, and additional paid-in capital (2)........... 2,955.5
Retained earnings.............................................. 3,053.3
Accumulated other comprehensive income......................... (77.6)
---------
Total common shareholder's equity............................ 5,931.2
---------
Total capitalization....................................... $45,095.0
=========
</TABLE>
- --------
(1) This table does not reflect the issuance of the Notes offered hereby.
(2) All of HFC's authorized common stock is owned by Household International.
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SELECTED FINANCIAL INFORMATION OF HFC
The financial information which is set forth below as of and for the two
years ended December 31, 1998 has been derived from the consolidated financial
statements and notes thereto of HFC and its subsidiaries as set forth in HFC's
Annual Report on Form 10-K for the year ended December 31, 1998, which have
been audited by Arthur Andersen LLP, independent certified public accountants.
HFC's Form 10-K is incorporated herein by reference. The financial information
which is set forth below as of and for the year ended December 31, 1999 is
unaudited and should be read in conjunction with HFC's Current Report on Form
8-K dated February 10, 2000, which is incorporated by reference herein. All
consolidated financial information of HFC and its subsidiaries presented below
is qualified in its entirety by the detailed information and financial
statements included in the documents referred to under "Where You Can Find
More Information" in the accompanying Prospectus. All amounts are stated in
millions of U.S. dollars.
Consolidated Statements of Income
<TABLE>
<CAPTION>
Year Ended December 31,
-----------------------------
1999 1998 1997
----------- -------- --------
(Unaudited)
<S> <C> <C> <C>
Finance income................................... $5,139.8 $4,581.4 $4,205.1
Other interest income............................ 67.3 36.5 35.1
Interest expense................................. 2,152.7 1,995.5 1,853.5
-------- -------- --------
Net interest margin.............................. 3,054.4 2,622.4 2,386.7
Provision for credit losses on owned receivables. 1,407.4 1,253.1 1,252.1
-------- -------- --------
Net interest margin after provision for credit
losses.......................................... 1,647.0 1,369.3 1,134.6
-------- -------- --------
Securitization income............................ 794.9 1,058.5 1,232.0
Insurance revenues............................... 357.7 352.9 352.9
Investment income................................ 154.4 146.7 152.6
Fee income....................................... 414.1 498.7 514.8
Other income..................................... 164.9 239.2 310.5
Gain on sale of Beneficial Canada................ -- 189.4 --
-------- -------- --------
Total other revenues............................. 1,886.0 2,485.4 2,562.8
-------- -------- --------
Salaries and fringe benefits..................... 964.9 921.7 925.3
Other operating expenses......................... 629.4 889.9 1,233.1
Amortization of acquired intangibles and
goodwill........................................ 143.3 168.8 143.4
Policyholders' benefits.......................... 224.7 207.6 236.6
Merger and integration related costs............. -- 1,000.0 --
-------- -------- --------
Total costs and expenses......................... 1,962.3 3,188.0 2,538.4
-------- -------- --------
Income before income taxes....................... 1,570.7 666.7 1,159.0
Income taxes..................................... 550.8 361.8 391.9
-------- -------- --------
Net income(1).................................... $1,019.9 $ 304.9 $ 767.1
======== ======== ========
</TABLE>
- --------
(1) Net operating income, which excludes merger and integration related costs
and the gain on the sale of Beneficial Canada, was $937.4 million for the
year ended December 31, 1998.
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<PAGE>
Consolidated Balance Sheets
<TABLE>
<CAPTION>
December 31,
-------------------------------
1999 1998 1997
----------- --------- ---------
(Unaudited)
<S> <C> <C> <C>
Assets
Cash........................................... $ 1,487.2 $ 428.4 $ 545.3
Investment securities.......................... 2,257.2 2,944.4 2,336.8
Receivables, net............................... 38,187.6 34,283.2 32,152.5
Advances to parent company and affiliates...... 691.8 494.0 10.5
Acquired intangibles and goodwill, net......... 1,572.9 1,682.7 1,777.9
Properties and equipment, net.................. 360.3 376.9 464.8
Real estate owned.............................. 266.6 235.1 187.8
Other assets................................... 1,991.6 1,918.3 1,973.3
--------- --------- ---------
Total assets................................. $46,815.2 $42,363.0 $39,448.9
========= ========= =========
Liabilities and Shareholder's Equity
Deposits....................................... -- -- $ 555.3
Commercial paper, bank and other borrowings.... $ 8,780.2 $ 7,143.1 9,547.1
Senior and senior subordinated debt (with
original maturities over one year)............ 30,383.6 27,186.1 20,909.2
--------- --------- ---------
Total debt................................... 39,163.8 34,329.2 31,011.6
Insurance policy and claim reserves............ 1,077.2 1,076.2 1,182.3
Other liabilities.............................. 643.0 1,147.2 1,451.3
--------- --------- ---------
Total liabilities............................ 40,884.0 36,552.6 33,645.2
Common shareholder's equity.................... 5,931.2 5,810.4 5,803.7
--------- --------- ---------
Total liabilities and shareholder's equity... $46,815.2 $42,363.0 $39,448.9
========= ========= =========
</TABLE>
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<PAGE>
DESCRIPTION OF NOTES
General
The following description of the terms of the % Notes due March ,
200 (the "Notes") offered hereby (referred to in the Prospectus as the
"Offered Debt Securities") supplements, insofar as such description relates to
the Notes, the description of the Debt Securities set forth in the Prospectus,
to which description reference is hereby made. The Notes are part of the Debt
Securities registered by the Company with the Securities and Exchange
Commission to be issued on terms to be determined at the time of sale. The
Notes constitute senior unsecured debt of the Company and will rank on a
parity with all other senior unsecured debt of the Company and prior to all
subordinated debt. The Notes are to be issued as a series of Senior Debt
Securities under an Indenture dated as of April 1, 1995 (the "Indenture"),
between the Company and Bank One, National Association (as successor to The
First National Bank of Chicago), as Trustee, which is more fully described in
the accompanying Prospectus under "Description of Debt Securities--Senior Debt
Securities."
The Notes are not subject to redemption by the Company prior to maturity
unless certain events occur involving U.S. taxation. See "Description of
Notes--Redemption for Tax Reasons."
The Notes will be issued in denominations of $1,000 and integral multiples
thereof. The Notes will mature on March , 200 . At maturity, the amount due
and payable on the Notes will be equal to 100% of their principal amount
outstanding, together with interest accrued but unpaid thereon to such
maturity date.
Any Notes issued in definitive form will be issued only in fully registered
form, without coupons, in denominations of $1,000 and in integral multiples
thereof, in the amount of each holder's registered holdings. Any Notes so
issued will be registered in such names, and in such denominations, as the
Depositary shall request. Such Notes may be presented for registration of
transfer or exchange at the office of the Trustee in Chicago, Illinois and
principal thereof and interest thereon will be payable at such office of the
Trustee, provided that interest thereon may be paid by check mailed to the
registered holders of the definitive Notes. In the event definitive Notes are
issued, the holders thereof will be able to receive payments thereon and
effect transfers thereof at the offices of Banque Internationale a Luxembourg
or its successor as paying agent in Luxembourg with respect to the Notes.
The Company has appointed Banque Internationale a Luxembourg as a paying
agent and transfer agent in Luxembourg with respect to the Notes, and as long
as the Notes are listed on the Luxembourg Stock Exchange, the Company will
maintain a paying agent and transfer agent in Luxembourg and any change in the
Luxembourg paying agent and transfer agent will be published in Luxembourg.
See "Description of Notes--Notices."
Interest
Interest on the Notes will accrue from and including March , 2000 at the
rate of % per annum and will be payable semiannually on each March and
September , beginning September , 2000, to the persons in whose names the
Notes are registered at the close of business on the preceding February or
August , respectively, except that interest payable at maturity shall be
paid to the same persons to whom principal of the Notes is payable. In the
event any principal of or interest on the Notes is due on a day other than a
Business Day (as defined below), the related payment of principal or interest
will be made on the next succeeding Business Day as if made on the date such
payment was due, and no interest will accrue on the amount so payable for the
period from and after the date such principal or interest is due, as the case
may be. "Business Day" with respect to any place of payment means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in such place of payment are authorized or obligated by law or
executive order to close. The amount of interest payable for any period will
be computed on the basis of a 360-day year of twelve 30-day months.
Depositary
Upon issuance, all Notes will be represented by one or more fully
registered global notes ("Global Notes"). Each such Global Note will be
deposited with, or on behalf of, The Depository Trust Company or any successor
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thereto ("DTC" or the "Depositary"), as Depositary, and registered in the name
of Cede & Co. (DTC's partnership nominee). Investors may elect to hold
interests in the Global Notes through either the Depositary (in the United
States) or Clearstream Banking, societe anonyme ("Clearstream Luxembourg")
(formerly Cedelbank), or Morgan Guaranty Trust Company of New York, Brussels
Office, as operator of the Euroclear System ("Euroclear"), if they are
participants in such systems, or indirectly through organizations which are
participants in such systems. See "Description of Debt Securities--Book-Entry
System" and "--Global Clearance and Settlement Procedures" in the accompanying
Prospectus.
Notices
Notices to holders of the Notes will be sent by mail to the registered
holders and will be published, whether the Notes are in global or definitive
form, and so long as the Notes are listed on the Luxembourg Stock Exchange, in
a daily newspaper of general circulation in Luxembourg. It is expected that
publication will be made in Luxembourg in the Luxemburger Wort. Any such
notice shall be deemed to have been given on the date of such publication or,
if published more than once, on the date of the first such publication. So
long as the Notes are listed on the Luxembourg Stock Exchange, any change in
the Luxembourg Paying Agent and Transfer Agent will be published in Luxembourg
in the manner set forth above.
Further Issues
The Company may from time to time, without notice to or the consent of the
registered holders of the Notes, create and issue further notes ranking pari
passu with the Notes in all respects (or in all respects except for the
payment of interest accruing prior to the issue date of such further Notes or
except for the first payment of interest following the issue date of such
further Notes) and so that such further Notes may be consolidated and form a
single series with the Notes and have the same terms as to status, redemption
or otherwise as the Notes.
Payment of Additional Amounts
The Company will, subject to the exceptions and limitations set forth
below, pay as additional interest on the Notes, such additional amounts
("Additional Amounts") as are necessary in order that the net payment by the
Company or a paying agent of the principal of and interest on the Notes to a
holder who is a non-United States person (as defined below), after deduction
for any present or future tax, assessment or other governmental charge of the
United States or a political subdivision or taxing authority thereof or
therein, imposed by withholding with respect to the payment, will not be less
than the amount provided in the Notes to be then due and payable; provided,
however, that the foregoing obligation to pay Additional Amounts shall not
apply:
(1) to any tax, assessment or other governmental charge that is imposed
or withheld solely by reason of the holder, or a fiduciary, settlor,
beneficiary, member or shareholder of the holder if the holder is an
estate, trust, partnership or corporation, or a person holding a power over
an estate or trust administered by a fiduciary holder, being considered as:
(a) being or having been present or engaged in a trade or business
in the United States or having had a permanent establishment in the
United States;
(b) having a current or former relationship with the United States,
including a relationship as a citizen or resident thereof;
(c) being or having been a foreign or domestic personal holding
company, a passive foreign investment company or a controlled foreign
corporation with respect to the United States or a corporation that has
accumulated earnings to avoid United States federal income tax;
(d) being or having been a "10-percent shareholder" of the Company
as defined in section 871(h)(3) of the United States Internal Revenue
Code or any successor provision; or
(e) being a bank receiving payments on an extension of credit made
pursuant to a loan agreement entered into in the ordinary course of its
trade or business;
(2) to any holder that is not the sole beneficial owner of the Note, or
a portion thereof, or that is a fiduciary or partnership, but only to the
extent that a beneficiary or settlor with respect to the fiduciary, a
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beneficial owner or member of the partnership would not have been entitled
to the payment of an additional amount had the beneficiary, settlor,
beneficial owner or member received directly its beneficial or distributive
share of the payment;
(3) to any tax, assessment or other governmental charge that is imposed
or withheld solely by reason of the failure of the holder or any other
person to comply with certification, identification or information
reporting requirements concerning the nationality, residence, identity or
connection with the United States of the holder or beneficial owner of such
Note, if compliance is required by statute, by regulation of the United
States Treasury Department or by an applicable income tax treaty to which
the United States is a party as a precondition to exemption from such tax,
assessment or other governmental charge;
(4) to any tax, assessment or other governmental charge that is imposed
otherwise than by withholding by the Company or a paying agent from the
payment;
(5) to any tax, assessment or other governmental charge that is imposed
or withheld solely by reason of a change in law, regulation, or
administrative or judicial interpretation that becomes effective more than
15 days after the payment becomes due or is duly provided for, whichever
occurs later;
(6) to any estate, inheritance, gift, sales, excise, transfer, wealth or
personal property tax or similar tax, assessment or other governmental
charge;
(7) to any tax, assessment or other governmental charge required to be
withheld by any paying agent from any payment of principal of or interest
on any Note, if such payment can be made without such withholding by any
other paying agent; or
(8) in the case of any combination of items (1), (2), (3), (4), (5), (6)
and (7).
The Notes are subject in all cases to any tax, fiscal or other law or
regulation or administrative or judicial interpretation applicable thereto.
Except as specifically provided under this heading "Payment of Additional
Amounts" and under the heading "Description of Notes--Redemption for Tax
Reasons," the Company shall not be required to make any payment with respect
to any tax, assessment or other governmental charge imposed by any government
or a political subdivision or taxing authority thereof or therein.
As used herein under the headings "Payment of Additional Amounts" and
"Description of Notes--Redemption for Tax Reasons," and in the accompanying
Prospectus under the headings "Certain United States Tax Documentation
Requirements" and "United States Taxation of Non-United States Persons" the
term "United States" means the United States of America (including the States
and the District of Columbia) and its territories, its possessions and other
areas subject to its jurisdiction. "United States person" means any individual
who is a citizen or resident of the United States, a corporation, partnership
or other entity created or organized in or under the laws of the United States
or of any political subdivision thereof (other than a partnership that is not
treated as a United States person under any applicable Treasury regulations),
any estate the income of which is subject to United States federal income
taxation regardless of its source, or any trust if a court within the United
States is able to exercise primary supervision over the administration of the
trust and one or more United States persons have the authority to control all
substantial decisions of the trust. Notwithstanding the preceding sentence, to
the extent provided in the Treasury regulations, certain trusts in existence
on August 20, 1996, and treated as United States persons prior to such date
that elect to continue to be treated as United States persons will also be a
United States person. "Non-United States person" means a person who is not a
United States person.
Redemption for Tax Reasons
If, as a result of any change in, or amendment to, the laws (or any
regulations or rulings promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change
in, or amendments to, an official position regarding the application or
interpretation of such laws, regulations or rulings, which change or amendment
is announced or becomes effective on or after the date of this Prospectus
Supplement, the Company becomes or, based upon a written opinion of
independent counsel
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selected by the Company, will become obligated to pay Additional Amounts as
described herein under the heading "Description of Notes--Payment of
Additional Amounts," then the Company may, at its option redeem, as a whole,
but not in part, the Notes on not less than 30 nor more than 60 days prior
notice, at a redemption price equal to 100% of their principal amount,
together with interest accrued but unpaid thereon to the date fixed for
redemption.
Tax Documentation Requirements and Taxation of Non-United States Persons
The Prospectus, under the headings "Certain United States Tax Documentation
Requirements" and "United States Taxation of Non-United States Persons,"
describes regulations that, as of the date of the Prospectus, were proposed to
become effective for payments made after December 31, 1999. On December 30,
1999 the Internal Revenue Service published in the Federal Register final
regulations extending the effective date of these new regulations to payments
made after December 31, 2000. Accordingly, except as described below, any
reference in such sections to "December 31, 1999" should be read as a
reference to "December 31, 2000." Despite this announced change, withholding
agents are still authorized to use the new IRS Form W-8 series of tax
certification forms described in the Prospectus prior to December 31, 1999.
Proposed EU Directive on the Taxation of Savings Income
A proposal is under consideration which, if enacted, would oblige Member
States of the European Union to adopt either a "withholding tax system" or an
"information reporting system" in relation to interest, discounts and
premiums. It is not known whether the proposal will be enacted in its present
form or at all.
The "withholding tax system" would generally require a paying agent
established in a Member State to withhold tax at a minimum rate (15% or 20%
are the rates currently in discussion) from any interest, discount or premium
paid directly to an individual resident in another Member State who is the
beneficial owner of the interest, discount or premium. However, no such
withholding would be required if such individual were to present a certificate
obtained from the tax authorities of the Member State in which he is a
resident confirming that those authorities are aware of the payment due to
that individual.
The "information reporting system" would require each Member State to
supply to each other Member State details of each payment of interest,
discount or premium made by paying agents within its jurisdiction directly to
an individual resident in each other Member State who is the beneficial owner
of the interest, discount or premium.
For these purposes, the term "paying agent" would be widely defined to
include any agent or other person who pays interest, discounts or premiums to
or collects such payments on behalf of, an individual beneficially entitled to
such payments.
If this proposal is adopted in its current form, it will not apply to
payments of interest, discount or premium made before January 1, 2001.
If this proposal is adopted in its current form no Additional Amounts will
be payable by the Company in respect of any withholding tax required by this
legislation to be deducted.
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UNDERWRITING
Under the terms and subject to the conditions contained in an underwriting
agreement dated March , 2000, we have agreed to sell the underwriters named
below the following respective principal amounts of the Notes:
<TABLE>
<CAPTION>
Principal
Underwriter Amount
----------- --------------
<S> <C>
Chase Securities Inc. .................................... $
Credit Suisse First Boston Corporation....................
--------------
Total................................................. $
==============
</TABLE>
The underwriting agreement provides that the underwriters are obligated to
purchase all of the Notes, if any are purchased. The underwriting agreement
provides that, in the event of a default by an underwriter, in certain
circumstances the purchase commitments of non-defaulting underwriters may be
increased or the offering of the Notes may be terminated.
The underwriters propose to offer the Notes initially at the public
offering price on the cover page of this prospectus supplement and to selling
group members at that price less a concession of % of the principal amount
per Note. The underwriters and selling group members may allow a discount of
% of such principal amount per Note on sales to other broker/dealers.
After the initial public offering, the public offering price and concession
and discount to broker/dealers may be changed by the underwriters.
Although application has been made to list the Notes on the Luxembourg
Stock Exchange, a listing may not be obtained. The Notes are a new issue of
securities with no established trading market. One or more of the underwriters
intends to make a secondary market for the Notes. However, they are not
obligated to do so and may discontinue making a secondary market for the Notes
at any time without notice. No assurance can be given as to the liquidity of
the trading market for the Notes.
We have agreed to indemnify the underwriters against liabilities under the
Securities Act of 1933, or to contribute to payments which the underwriters
may be required to make in that respect.
We estimate that our out of pocket expenses for this offering will be
approximately $ .
Some of the underwriters and their associates and affiliates may be
customers of, have borrowing relationships with, engage in other transactions
with, and/or perform services, including commercial and investment banking
services, for, the Company and its affiliates in the ordinary course of
business.
The Notes are offered for sale in those jurisdictions in the United States,
Canada, Europe, Asia and elsewhere where it is lawful to make such offers.
Each of the underwriters has represented and agreed that it has not
offered, sold or delivered and will not offer, sell or deliver any of the
Notes directly or indirectly, or distribute this Prospectus Supplement or the
Prospectus or any other offering material relating to the Notes, in or from
any jurisdiction except under circumstances that will result in compliance
with the applicable laws and regulations thereof and that will not impose any
obligations on the Company except as set forth in the underwriting agreement.
In particular, each underwriter has represented and agreed that:
(i) it has not offered or sold and will not offer or sell any Notes to
persons in the United Kingdom prior to the expiry of the period of six
months from the issue date of the Notes except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purpose of their businesses or
otherwise in circumstances which have not resulted and will not result in
an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995;
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(ii) it has only issued or passed on and will only issue or pass on in
the United Kingdom any document received by it in connection with the issue
of the Notes to a person who is of a kind described in Article 11(3) of the
Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order
1996 (as amended) or is a person to whom such document may otherwise
lawfully be issued or passed on;
(iii) it has complied and will comply with all applicable provisions of
the Financial Services Act 1986 with respect to anything done by it in
relation to any Notes in, from or otherwise involving the United Kingdom;
(iv) it will not offer or sell any Notes directly or indirectly in Japan
or to, or for the benefit of any Japanese person or to others, for re-
offering or re-sale directly or indirectly in Japan or to any Japanese
person except under circumstances which will result in compliance with all
applicable laws, regulations and guidelines promulgated by the relevant
governmental and regulatory authorities in effect at the relevant time. For
purposes of this paragraph, "Japanese person" shall mean any person
resident in Japan, including any corporation or other entity organized
under the laws of Japan;
(v) it is aware of the fact that no German selling prospectus
(Verkaufsprospekt) has been or will be published in respect of the sale of
the Notes and that it will comply with the Securities Selling Prospectus
Act (the "Act") of the Federal Republic of Germany (Wertpapier-
Verkaufsprospektgeset:). In particular, each Underwriter has undertaken not
to engage in public offering (offentliche Anbieten) in the Federal Republic
of Germany with respect to any Notes otherwise than in accordance with the
Act and any other act replacing or supplementing the Act and all other
applicable laws and regulations; and
(vi) the Notes are being issued and sold outside the Republic of France
and that, in connection with their initial distribution, it has not offered
or sold and will not offer or sell, directly or indirectly, any Notes to
the public in the Republic of France, and that it has not distributed and
will not distribute or cause to be distributed to the public in the
Republic of France the Prospectus Supplement, the Prospectus or any other
offering material relating to the Notes.
The underwriters may engage in over-allotment, stabilizing transactions,
syndicate covering transactions and penalty bids in accordance with Regulation
M under the Securities Exchange Act of 1934.
. Over-allotment involves syndicate sales in excess of the offering
size, which creates a syndicate short position.
. Stabilizing transactions permit bids to purchase the underlying
security so long as the stabilizing bids do not exceed a specified maximum.
. Syndicate covering transactions involve purchases of the Notes in the
open market after the distribution has been completed in order to cover
syndicate short positions.
. Penalty bids permit the underwriters to reclaim a selling concession
from a syndicate member when the Notes originally sold by such syndicate
member are purchased in a syndicate covering transaction to cover syndicate
short positions.
Such stabilizing transactions, syndicate covering transactions and penalty
bids may cause the price of the Notes to be higher than it would otherwise be
in the absence of such transactions. Neither the Company nor the underwriters
make any representation that the Underwriters will engage in such transactions
or that such transactions, once commenced, will not be discontinued without
notice.
It is expected that delivery of the Notes will be made against payment
therefor on or about the date specified in the last paragraph of the cover
page of this Prospectus, which is the fifth business day following the date
hereof. Under Rule 15c6-1 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, trades in the secondary market generally are
required to settle in three business days, unless the parties to any such
trade expressly agree otherwise. Accordingly, purchasers who wish to trade
Notes on the date hereof or the next succeeding business day will be required,
by virtue of the fact that the Notes initially will settle in T+5, to specify
an alternate settlement cycle at the time of any such trade to prevent a
failed settlement and should consult their own advisor.
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NOTICE TO CANADIAN RESIDENTS
Resale Restrictions
The distribution of the Notes in Canada is being made only on a private
placement basis exempt from the requirement that the Company prepare and file
a prospectus with the securities regulatory authorities in each province where
trades of the Notes are effected. Accordingly, any resale of the Notes in
Canada must be made in accordance with applicable securities laws which will
vary depending on the relevant jurisdiction, and which may require resales to
be made in accordance with the available statutory exemptions or pursuant to a
discretionary exemption granted by the applicable Canadian securities
regulatory authority. Purchasers are advised to seek legal advice prior to any
resale of the Notes.
Representations of Purchasers
Each purchaser of Notes in Canada who receives a purchase confirmation will
be deemed to represent to the Company and the dealer from whom such purchase
confirmation is received that (i) such purchaser is entitled under applicable
provincial securities laws to purchase such Notes without the benefit of a
prospectus qualified under such securities laws or an offering memorandum,
(ii) where required by law, that such purchaser is purchasing as principal and
not as agent, (iii) if in Quebec, such purchaser shall be deemed to have
agreed that all documents relating to such purchase be in English only, and
(iv) such purchaser has reviewed and acknowledges the terms above under
"Resale Restrictions."
Rights of Action (Ontario Purchasers)
The securities being offered are those of a foreign issuer and Ontario
purchasers will not receive the contractual right of action prescribed by
Ontario securities law. As a result, Ontario purchasers must rely on other
remedies that may be available, including common law rights of action for
damages or rescission or rights of action under the civil liability provision
of the U.S. federal securities laws.
Enforcement of Legal Rights
All of the Company's directors and officers as well as the experts named
herein may be located outside of Canada and, as a result, it may not be
possible for Canadian purchasers to effect service of process within Canada on
the Company or such persons. All or a substantial portion of the assets of the
Company and such persons may be located outside of Canada and, as a result, it
may not be possible to satisfy a judgment against the Company or such persons
in Canada or to enforce a judgment obtained in Canadian courts against the
Company or such persons outside of Canada.
Notice to British Columbia Residents
A purchaser of Notes to whom the Securities Act (British Columbia) applies
is advised that such purchaser is required to file with the British Columbia
Securities Commission a report within ten days of the sale of any Notes
acquired by such purchaser pursuant to this offering. Such report must be in
the form attached to British Columbia Securities Commission Blanket Order BOR
#95/17, a copy of which may be obtained from the Company. Only one such report
must be filed in respect of Notes acquired on the same date and under the same
prospectus exemption.
Taxation and Eligibility for Investment
Canadian purchasers of the Notes should consult their own legal and tax
advisors with respect to the tax consequences of an investment in the Notes in
their particular circumstances and with respect to the eligibility of the
Notes for investment by the purchaser under relevant Canadian legislation.
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<PAGE>
LEGAL OPINIONS
The legality of the Notes will be passed upon for HFC by John W. Blenke,
Vice President--Corporate Law and Assistant Secretary for Household
International, Inc., the parent of HFC. Certain legal matters will be passed
upon for the underwriters by McDermott, Will & Emery, Chicago, Illinois. Mr.
Blenke is a full-time employee and an officer of Household International, Inc.
and owns, and holds options to purchase, shares of Common Stock of Household
International, Inc.
EXPERTS
The consolidated financial statements and schedules of HFC and its
subsidiaries incorporated by reference in this Prospectus Supplement, to the
extent and for the periods indicated in its reports, have been audited by
Arthur Andersen LLP, independent public accountants, and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
giving said reports.
GENERAL INFORMATION
Application has been made to list the Notes on the Luxembourg Stock
Exchange. In connection with the listing application, the Certificate of
Incorporation and the By-Laws of the Company and a legal notice relating to
the issuance of the Notes have been deposited prior to listing with Greffier
en Chef du Tribunal d'Arrondissement de et a Luxembourg, where copies thereof
may be obtained upon request. Copies of the above documents together with this
Prospectus Supplement, the accompanying Prospectus, the Indenture, the form of
Underwriting Agreement and the Company's current Annual Report on Form 10-K.
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as all
such future reports, so long as any of the Notes are outstanding, will be made
available for inspection at the main office of Banque Internationale a
Luxembourg, in Luxembourg. Banque Internationale a Luxembourg will act as
intermediary between the Luxembourg Stock Exchange and the Company and the
holders of the Notes, as long as the Notes are represented by Global Notes. In
addition, copies of the above reports of the Company may be obtained free of
charge at such office.
Other than as disclosed or contemplated herein or in the documents
incorporated herein by reference, there has been no material adverse change in
the financial position of the Company since December 31, 1999.
The independent accountants of the Company are Arthur Andersen LLP,
Chicago, Illinois.
Other than as disclosed or contemplated in the documents incorporated
herein by reference, neither the Company nor any of its subsidiaries is
involved in litigation, arbitration, or administrative proceedings relating to
claims or amounts that are material in the context of the issue of the Notes
and the Company is not aware of any such litigation, arbitration, or
administrative proceedings pending or threatened.
Resolutions relating to the issue and sale of the Notes were adopted by the
Board of Directors of the Company on March , 2000.
The Notes, the Indenture and the Underwriting Agreement are governed by,
and shall be construed in accordance with, the laws of the State of Illinois,
United States of America, applicable to agreements made and to be performed
wholly within such jurisdiction.
The Notes have been assigned Euroclear and Cedel Common Code No. ,
International Security Identification Number (ISIN) and CUSIP No.
.
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PRINCIPAL OFFICE OF THE COMPANY
2700 Sanders Road
Prospect Heights, Illinois 60070
TRUSTEE AND REGISTRAR
Bank One, National Association
Corporate Trust Office
1 Bank One Plaza
Suite IL1-0126
Chicago, Illinois 60670
LUXEMBOURG PAYING AGENT/TRANSFER AGENT
Banque Internationale a Luxembourg S.A.
69, route d'Esch
L-2953 Luxembourg
LISTING AGENT
Banque Internationale a Luxembourg S.A.
69, route d'Esch
L-2953 Luxembourg
LEGAL ADVISERS
To the Company To the Underwriters
as to United States Law as to United States Law
John W. Blenke, Esq. McDermott, Will & Emery
2700 Sanders Road 227 W. Monroe Street
Prospect Heights, Illinois 60070 Chicago, Illinois 60606
To the Company
as to United States Tax Law
Sidley & Austin
One First National Plaza
Chicago, Illinois 60603
AUDITORS TO THE COMPANY
Arthur Andersen LLP
33 West Monroe Street
Chicago, Illinois 60603
