EXHIBIT 4(g)
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of _______ __, 1997 (this "Agreement"), among
Household International, Inc., a Delaware corporation (the "Company"), _________
__________, a ____________________________, not individually but solely as
collateral agent (in such capacity, together with its successors in such
capacity, the "Collateral Agent") and as "depositary" (as defined in 31 C.F.R
(S)306, as amended) and as "securities intermediary" (as defined in Section
8-102(a)(14) of the 1994 Official Text of the Uniform Commercial Code and in
31 C.F.R. (S)357.2, as amended (in such capacity, together with its successors
in such capacity, the "Securities Intermediary")) for the collateral account and
for any Treasury Notes credited to the collateral account, and _______________
____, not individually but solely as purchase contract agent and as attorney-in-
fact of the Holders (as hereinafter defined) from time to time of the Securities
(as hereinafter defined) (in such capacity, together with its successors in such
capacity, the "Purchase Contract Agent") under the Purchase Contract Agreement
(as hereinafter defined).
RECITALS
The Company and the Purchase Contract Agent are parties to the Purchase
Contract Agreement, dated as of the date hereof (as modified and supplemented
and in effect from time to time, the "Purchase Contract Agreement"), pursuant to
which there will be issued __________________________________________________
_____ (the "Securities").
Each Security consists of (a) one Purchase Contract (as hereinafter
defined) and (b) ______________________________________________________
("Treasury Notes") having a principal amount equal to $_____ (the "Stated
Amount") and maturing on __________, ____ (the "Final Settlement Date"), subject
to the pledge of such Treasury Notes created hereby.
The Company has caused the Underwriters, on its behalf, to purchase the
Treasury Notes, to be settled on _______ __, 1997, with the proceeds of the
offering of the Securities and other funds to be provided by the Company. The
Company will convey such Treasury Notes to the Holders as a part of the
Securities.
Pursuant to the terms of the Purchase Contract Agreement and the Purchase
Contracts, the Holders (as defined in the Purchase Contract Agreement) from time
to time of the Securities have authorized the Purchase Contract Agent, as
attorney-in-fact of such Holders, among other things to execute and deliver this
Agreement on behalf of such Holders and to grant the pledge provided hereby of
the Treasury Notes constituting part of such Securities as provided herein and
subject to the terms hereof.
Accordingly, the Company, the Collateral Agent and the Purchase Contract
Agent, on its own behalf and as attorney-in-fact of the Holders from time to
time of the Securities, agree as follows:
Section 1. Definitions. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular; and
(b) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular Article,
Section or other subdivision.
"Acceleration" has the meaning specified in the Purchase Contract
Agreement.
"Act" has the meaning specified in the Purchase Contract Agreement.
"Agreement" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more agreements supplemental
hereto entered into pursuant to the applicable provisions hereof.
"Applicable Treasury Regulations" means Subpart O- Book-Entry Procedure of
Title 31 of the Code of Federal Regulations (31 C.F.R. (S) 306.115 et. seq.) and
any other regulations of the United States Treasury Department from time to time
applicable to the transfer or pledge of book-entry U.S. Treasury Securities.
"Bankruptcy Code" means title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.
"Bankruptcy Event" has the meaning specified in the Purchase Contract
Agreement.
"Board Resolution" has the meaning specified in the Purchase Contract
Agreement.
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"Business Day" means any day that is not a Saturday, a Sunday or a day on
which the New York Stock Exchange or banking institutions or trust companies in
The City of New York are authorized or obligated by law or executive order to be
closed.
"Collateral Agent" has the meaning specified in the first paragraph of this
instrument.
"Collateral Account" means the account maintained at ___________________
_______________ in the name ___________________________________ as Collateral
Agent of Household International, Inc. as pledgee of ____________________ as
Purchase Contract Agent".
"Company" means the Person named as the "Company" in the first paragraph of
this instrument until a successor shall have become such, and thereafter
"Company" shall mean such successor.
"Final Settlement Date" has the meaning specified in the Recitals.
"Holder" when used with respect to a Security, or a Purchase Contract
constituting a part thereof, has the meaning specified in the Purchase Contract
Agreement.
"Holder's Early Settlement" has the meaning specified in the Purchase
Contract Agreement.
"Holder's Early Settlement Amount" has the meaning specified in the
Purchase Contract Agreement.
"Opinion of Counsel" means an opinion in writing signed by legal counsel,
who may be an employee of or counsel to the Company and who shall be reasonably
acceptable to the Collateral Agent or the Purchase Contract Agent, as the case
may be.
"Outstanding Securities" has the meaning specified in the Purchase Contract
Agreement.
"Outstanding Security Certificates" has the meaning specified in the
Purchase Contract Agreement.
"Payment Date" has the meaning specified in the Purchase Contract
Agreement.
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Exhibit 4(g)
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" has the meaning specified in Section 2 hereof.
"Pledged Treasury Notes" has the meaning specified in Section 2 hereof.
"Purchase Contract" has the meaning specified in the Purchase Contract
Agreement.
"Purchase Contract Agent" has the meaning specified in the first paragraph
of this instrument.
"Sale of Assets" has the meaning specified in the Purchase Contract
Agreement.
"Security" has the meaning specified in the Recitals.
"Security Certificate" has the meaning specified in the Purchase Contract
Agreement.
"Stated Amount" has the meaning specified in the Recitals.
"Treasury Notes" has the meaning specified in the Recitals.
"Underwriters" means the several Underwriters named in the Underwriting
Agreement dated _______ __, 1997 between the Company and ____________________
_______________________________________________________________________________
_____________________________ as representatives of the several Underwriters
named herein.
Section 2. The Pledge.
The Holders from time to time of the Securities acting through the Purchase
Contract Agent, as their attorney-in-fact, hereby pledge and grant to the
Collateral Agent for the benefit of the Company, as collateral security for the
performance when due by such Holders of their respective obligations under the
Purchase Contracts comprising a portion of such Securities, a security interest
in all of the right, title and interest of such Holders in the Treasury Notes
credited to the Collateral Account. Concurrently with the execution and delivery
of the Securities (i) Xxxxxx Xxxxxxx & Co., Incorporated shall cause the
Treasury Notes to be credited to an account of the Securities Intermediary at
the ________________
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_______________ by Federal Reserve Bank-Wire and (ii) the Securities
Intermediary shall credit the Treasury Notes to the Collateral Account, in each
case pursuant to Applicable Treasury Regulations and to the Uniform Commercial
Code to the extent such laws are applicable and pursuant to instructions from
the Purchase Contract Agent on behalf of the Holders. The pledge provided in
this Section 2 is herein referred to as the "Pledge" and the Treasury Notes
subject to the Pledge, excluding any Treasury Notes released from the Pledge as
provided in Section 4 hereof, are hereinafter referred to as the "Pledged
Treasury Notes." Subject to the Pledge, and to the provisions of Article 4 of
the Purchase Contract Agreement, the Holders from time to time of the Securities
shall have full beneficial ownership of the Treasury Notes credited to the
Collateral Account and all securities entitlements (as defined in 31 C.F.R.
(S)357.2 or any similar provision of state law or Revised Article 8 (as defined
in 31 C.F.R. (S)357)) in respect thereof.
Notwithstanding any other provision of this Agreement, the Securities
Intermediary hereby agrees that (a) it will comply with "entitlement orders"
(within the meaning of Section 8-102(a)(8) of Revised Article 8) relating to the
Collateral Account issued by the Collateral Agent without further consent by the
Purchase Contract Agent or any Holder and (b) it hereby waives any right of set-
off or recoupment that it may have with respect to the Collateral Account. The
Securities Intermediary hereby represents that it has not entered into, and
hereby agrees that until the termination of the Purchase Contract Agreement it
will not enter into, any agreement with any of the parties hereto specifying any
jurisdiction other than the State of New York as its jurisdiction for purposes
of 31 C.F.R (S)357.11(b), as amended, and any similar state law, or with any
other person relating to the Collateral Account pursuant to which it has agreed
to comply with entitlement orders made by such person.
Section 3. Distribution of Principal and Interest.
(a) All payments of principal of, or interest on, any Treasury Notes
constituting part of the Securities received by the Collateral Agent shall be
paid by the Collateral Agent by wire transfer in same day funds no later than
12:00 p.m., New York City time, on the Business Day such interest payment is
received by the Collateral Agent (provided that in the event such interest
payment is received by the Collateral Agent on a day that is not a Business Day,
then such payment shall be made no later than 10:00 a.m., New York City time, on
the next succeeding Business Day) (i) in the case of (A) interest payments and
(B) any principal payments with respect to any Treasury Notes that have been
released from the Pledge pursuant to Section 4 hereof, to the Purchase Contract
Agent to the account designated by it for such purpose and (ii) in the case of
principal payments on any Pledged Treasury Notes, the Collateral Agent is hereby
authorized to make such payments to the Company, in full satisfaction of the
respective obligations of
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the Holders of the Securities of which such Pledged Treasury Notes are a part
under the Purchase Contracts forming a part of such Securities. All such
payments received by the Purchase Contract Agent as provided herein shall be
applied by the Purchase Contract Agent pursuant to the provisions of the
Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase
Contract Agent shall receive any payments of principal on account of any Pledged
Treasury Notes, the Purchase Contract Agent shall hold the same as trustee of an
express trust for the benefit of the Company (and promptly deliver over to the
Company) for application to the obligations of the Holders of the Securities of
which such Treasury Notes are a part under the Purchase Contracts relating to
the Securities of which such Treasury Notes are a part, and such Holders shall
acquire no right, title or interest in any such payments of principal so
received.
Section 4. Release of Pledged Treasury Notes.
(a) Upon written notice to the Collateral Agent by the Company or the
Purchase Contract Agent that there has occurred a Bankruptcy Event or Sale of
Assets, resulting in the termination of the Purchase Contracts in accordance
with Section 5.09 of the Purchase Contract Agreement, the Collateral Agent shall
release all Pledged Treasury Notes from the Pledge and shall transfer all such
Treasury Notes, free and clear of any lien, pledge or security interest created
hereby, to the Purchase Contract Agent.
If such Bankruptcy Event or Sale of Assets shall result from the Company's
becoming a debtor under the Bankruptcy Code, and if the Collateral Agent shall
for any reason fail immediately to effectuate the release and transfer of all
Pledged Treasury Notes as provided by this Section 4(a), the Purchase Contract
Agent shall, subject to Section 6(m), and provided, however, that the Company
shall have offered to the Purchase Contract Agent such reasonable indemnity as
it may require against the costs, liabilities and expenses to be incurred herein
(i) use its best efforts to obtain an opinion of a nationally recognized law
firm reasonably acceptable to the Collateral Agent to the effect that, as a
result of the Company's being the debtor in such a bankruptcy case, the
Collateral Agent will not be prohibited from releasing or transferring the
Treasury Notes as provided in this Section 4(a), and shall deliver such opinion
to the Collateral Agent within ten days after the occurrence of such Bankruptcy
Event or Sale of Assets, and if (y) the Purchase Contract Agent shall be unable
to obtain such opinion within ten days after the occurrence of such Bankruptcy
Event or Sale of Assets or (z) the Collateral Agent shall continue, after
delivery of such opinion, to refuse to effectuate the release and transfer of
all Pledged Treasury Notes as provided in this Section 4(a), then the Purchase
Contract Agent shall within fifteen days after the occurrence of such Bankruptcy
Event or Sale of Assets commence an action or proceeding in the court with
jurisdiction of the Company's case under the
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Bankruptcy Code seeking an order requiring the Collateral Agent to effectuate
the release and transfer of all Pledged Treasury Notes as provided by this
Section 4(a) or (ii) commence an action or proceeding like that described in the
immediately preceding subsection hereof within ten days after the occurrence of
such Bankruptcy Event or Sale of Assets.
(b) Upon written notice to the Collateral Agent and the Company by the
Purchase Contract Agent that one or more Holders of Securities have elected to
effect Holder's Early Settlement of their respective obligations under the
Purchase Contracts forming a part of such Securities in accordance with the
terms of the Purchase Contracts and the Purchase Contract Agreement (setting
forth the number of such Purchase Contracts as to which such Holders have
elected to effect Holder's Early Settlement), and that the Purchase Contract
Agent has received from such Holders, and paid to the Company, the related
Holder's Early Settlement Amounts pursuant to the terms of the Purchase
Contracts and the Purchase Contract Agreement and that all conditions to such
Holder's Early Settlement have been satisfied, then the Company shall direct the
Collateral Agent to release from the Pledge and transfer all such Treasury
Notes, free and clear of any lien, pledge or security interest created hereby,
to the Purchase Contract Agent with a principal amount equal to the product of
(i) the Stated Amount times (ii) the number of such Purchase Contracts as to
which such Holders have elected to effect Holder's Early Settlement.
(c) Upon written notice to the Collateral Agent by the Company of an
Acceleration in accordance with the terms of the Purchase Contracts and the
Purchase Contract Agreement (setting forth the number of Securities to be
accelerated), and that all conditions to such Acceleration have been satisfied,
then the Collateral Agent shall release from the Pledge and shall transfer all
such Treasury Notes, free and clear of any lien, pledge or security interest
created hereby, to the Purchase Contract Agent with a principal amount equal to
the product of (i) the Stated Amount times (ii) the number of Securities to be
accelerated.
(d) Transfers of Treasury Notes pursuant to Section 4(a), (b) or (c) shall
be by Federal Reserve Bank-Wire or in another appropriate manner, (i) if the
Collateral Agent shall have received such notification at or prior to 11:00
a.m., New York City time, on a Business Day, then no later than 2:00 p.m., New
York City time, on such Business Day and (ii) if the Collateral Agent shall have
received such notification on a day that is not a Business Day or after 11:00
a.m., New York City time, on a Business Day, then no later than 10:00 a.m., New
York City time, on the next succeeding Business Day.
Section 5. Rights and Remedies.
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(a) The Collateral Agent shall have all of the rights and remedies with
respect to the Pledged Treasury Notes of a secured party under the Uniform
Commercial Code as in effect in the State of New York (the "Code") (whether or
not the Code is in effect in the jurisdiction where the rights and remedies are
asserted) and such additional rights and remedies to which a secured party is
entitled under the laws in effect in any jurisdiction where any rights and
remedies hereunder may be asserted.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of principal payments of any Pledged
Treasury Notes as provided in Section 3 hereof in satisfaction of the
obligations of the Holder of the Securities of which such Pledged Treasury Notes
are a part under the Purchase Contracts forming a part of such Securities, the
Collateral Agent shall have and may exercise, with reference to such Pledged
Treasury Notes and such obligations of such Holder, any and all of the rights
and remedies available to a secured party under the Code after default by a
debtor, and as otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of principal of or interest on
the Pledged Treasury Notes.
(d) The Purchase Contract Agent agrees that, from time to time, upon the
written request of the Collateral Agent, the Purchase Contract Agent shall
execute and deliver such further documents and do such other acts and things as
the Collateral Agent may reasonably request in order to maintain the Pledge, and
the perfection and priority thereof, and to confirm the rights of the Collateral
Agent hereunder; provided that, except as expressly set forth herein or in
accordance with this subsection (d), the Purchase Contract Agent shall have no
obligation or liability with respect to the maintenance or perfection of the
Pledge.
Section 6. The Collateral Agent and the Purchase Contract Agent.
It is hereby agreed as follows:
(a) Appointment, Powers and Immunities. The Collateral Agent shall act as
----------------------------------
agent for the Company hereunder with such powers as are specifically vested in
the Collateral Agent by the terms of this Agreement, together with such other
powers as are reasonably incidental thereto. The Collateral Agent: (i) shall
have no duties or responsibilities except those expressly set forth in this
Agreement and no implied covenants or obligations shall be inferred from this
Agreement against the
8
Collateral Agent, nor shall the Collateral Agent be bound by the provisions of
any agreement by any party hereto beyond the specific terms hereof; (ii) shall
not be responsible for any recitals contained in this Agreement, or in any
certificate or other document referred to or provided for in, or received by it
under, this Agreement, the Securities or the Purchase Contract Agreement, or for
the value, validity, effectiveness, genuineness, enforceability or sufficiency
of this Agreement (other than as against the Collateral Agent), the Securities
or the Purchase Contract Agreement or any other document referred to or provided
for herein or therein or for any failure by the Company or any other Person
(except the Collateral Agent) to perform any of its obligations hereunder or
thereunder; (iii) shall not be required to initiate or conduct any litigation or
collection proceedings hereunder (except pursuant to directions furnished under
Section 6(b) hereof); (iv) shall not be responsible for any action taken or
omitted to be taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith or therewith,
except for its own gross negligence; and (v) shall not be required to advise any
party as to selling or retaining, or taking or refraining from taking any action
with respect to, any securities or other property deposited hereunder. Subject
to the foregoing, during the term of this Agreement, the Collateral Agent shall
take all reasonable action in connection with the safe keeping and preservation
of the Pledged Treasury Notes hereunder.
No provision of this Agreement shall require the Collateral Agent to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder. In no event shall the Collateral
Agent be liable for any amount in excess of the value of the Pledged Treasury
Notes.
(b) Instructions of the Company. The Company shall have the right, by one
---------------------------
or more instruments in writing executed and delivered to the Collateral Agent,
to direct the time, method and place of conducting any proceeding for any right
or remedy available to the Collateral Agent, or of exercising any power
conferred on the Collateral Agent, or to direct the taking or refraining from
taking of any action authorized by this Agreement; provided, however, that (i)
such direction shall not conflict with the provisions of any law or of this
Agreement and (ii) the Collateral Agent shall be adequately indemnified as
provided herein. Nothing in this Section 6(b) shall impair the right of the
Collateral Agent in its discretion to take any action or omit to take any action
which it deems proper and which is not inconsistent with such direction.
(c) Reliance by Collateral Agent. The Collateral Agent shall be entitled
----------------------------
to rely upon any certification, order, judgment, opinion, notice or other
communication (including, without limitation, any thereof by telephone,
telecopy, telex, telegram or cable) reasonably believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons (without
9
being required to determine the correctness of any fact stated therein), and
upon advice and statements of legal counsel and other experts selected by the
Collateral Agent. As to any matters not expressly provided for by this
Agreement, the Collateral Agent shall in all cases be fully protected in acting,
or in refraining from acting, hereunder in accordance with instructions given by
the Company in accordance with this Agreement.
(d) Rights in Other Capacities. The Collateral Agent and its affiliates
--------------------------
may (without having to account therefor to the Company) accept deposits from,
lend money to, make investments in and generally engage in any kind of banking,
trust or other business with the Purchase Contract Agent and any Holder of
Securities (and any of their subsidiaries or affiliates) as if it were not
acting as the Collateral Agent, and the Collateral Agent and its affiliates may
accept fees and other consideration from the Purchase Contract Agent and any
Holder of Securities without having to account for the same to the Company,
provided that the Collateral Agent covenants and agrees with the Company that
the Collateral Agent shall not accept, receive or permit there to be created in
its favor any security interest, lien or other encumbrance of any kind in or
upon the Pledged Treasury Notes.
(e) Non-Reliance on Collateral Agent. The Collateral Agent shall not be
--------------------------------
required to keep itself informed as to the performance or observance by the
Purchase Contract Agent or any Holder of Securities of this Agreement, the
Purchase Contract Agreement, the Securities or any other document referred to or
provided for herein or therein or to inspect the properties or books of the
Purchase Contract Agent or any Holder of Securities. The Collateral Agent shall
not have any duty or responsibility to provide the Company with any credit or
other information concerning the affairs, financial condition or business of the
Purchase Contract Agent or any Holder of Securities (or any of their affiliates)
that may come into the possession of the Collateral Agent or any of its
affiliates.
(f) Compensation and Indemnity by Company. The Company agrees: (i) to pay
-------------------------------------
the Collateral Agent from time to time reasonable compensation for all services
rendered by it hereunder and (ii) to indemnify the Collateral Agent and the
Purchase Contract Agent for, and to hold them harmless against, any loss,
liability or expense incurred without gross negligence or bad faith on their
part, arising out of or in connection with the acceptance or administration of
their powers and duties under this Agreement, including the costs and expenses
(including reasonable fees and expenses of counsel) of defending themselves
against any claim or liability in connection with the exercise or performance of
such powers and duties.
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(g) Compensation and Indemnity by Holders. The Holders agree (i) to
-------------------------------------
indemnify the Purchase Contract Agent for, and to hold it harmless against, any
loss, liability or expense incurred without gross negligence or bad faith on its
part, arising out of or in connection with the institution of suit on behalf of
the Holders pursuant to Section 4(a) above and (ii) to compensate the Purchase
Contract Agent for the reasonable costs and expenses (including reasonable fees
and expenses of counsel) incurred by it in instituting such suit.
(h) Failure to Act. In the event of any ambiguity in the provisions of
--------------
this Agreement or any dispute between or conflicting claims by or among the
parties hereto and/or any other Person with respect to any funds or property
deposited hereunder, the Collateral Agent shall be entitled, at its sole option,
to refuse to comply with any and all claims, demands or instructions with
respect to such property or funds so long as such dispute or conflict shall
continue, and the Collateral Agent shall not be or become liable in any way to
any of the parties hereto for its failure or refusal to comply with such
conflicting claims, demands or instructions. The Collateral Agent shall be
entitled to refuse to act until either (i) such conflicting or adverse claims or
demands shall have been finally determined by a court of competent jurisdiction
or settled by agreement between the conflicting parties as evidenced in a
writing, satisfactory to the Collateral Agent or (ii) the Collateral Agent shall
have received security or an indemnity satisfactory to the Collateral Agent
sufficient to save the Collateral Agent harmless from and against any and all
loss, liability or expense which the Collateral Agent may incur by reason of its
acting. The Collateral Agent may in addition elect to commence an interpleader
action or seek other judicial relief or orders as the Collateral Agent may deem
necessary. Notwithstanding anything contained herein to the contrary, the
Collateral Agent shall not be required to take any action that is in its opinion
contrary to law or to the terms of this Agreement, or which would in its opinion
subject it or any of its officers, employees or directors to liability.
(i) Resignation of Collateral Agent. Subject to the appointment and
-------------------------------
acceptance of a successor Collateral Agent as provided below, (a) the Collateral
Agent may resign at any time by giving notice thereof to the Company and the
Purchase Contract Agent, (b) the Collateral Agent may be removed at any time
by the Company and (c) if the Collateral Agent fails to perform any of its
material obligations hereunder in any material respect for a period of not less
than 20 days after receiving written notice of such failure by the Purchase
Contract Agent and such failure shall be continuing, the Collateral Agent may be
removed by the Purchase Contract Agent at the written direction of __% in
aggregate principal amount of Holders of the Securities. The Purchase Contract
Agent shall promptly notify the Company of any removal of the Collateral Agent
pursuant to clause (c) of the immediately preceding sentence. Upon any such
resignation or removal, the Company shall have the right to appoint a successor
Collateral Agent. If no
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successor Collateral Agent shall have been so appointed and shall have accepted
such appointment within 30 days after the retiring Collateral Agent's giving of
notice of resignation or such removal, then the retiring Collateral Agent may at
the expense of the Company petition any court of competent jurisdiction for the
appointment of a successor Collateral Agent. The Collateral Agent shall be a
bank which has an office in New York, New York and a combined capital and
surplus of at least $50,000,000. Upon the acceptance of any appointment as
Collateral Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent, and the
retiring Collateral Agent shall take all appropriate action to transfer any
money and property held by it hereunder (including the Pledged Treasury Notes)
to such successor Collateral Agent. The retiring Collateral Agent shall, upon
such succession, be discharged from its duties and obligations as Collateral
Agent hereunder. After any retiring Collateral Agent's resignation hereunder as
Collateral Agent, the provisions of this Section 6 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Collateral Agent.
Promptly following the removal or resignation of the Collateral Agent the
Company shall give written notice thereof to _______________________________.
(j) Right to Appoint Agent or Advisor. The Collateral Agent shall have the
---------------------------------
right to appoint agents or advisors in connection with any of its duties
hereunder, and the Collateral Agent shall not be liable for any action taken or
omitted by such agents or advisors selected in good faith.
(k) Survival. The provisions of this Section 6 shall survive termination
--------
of this Agreement and the resignation or removal of the Collateral Agent.
(l) Anything in this Agreement to the contrary notwithstanding, in no
event shall the Collateral Agent or its officers, employees or agents be liable
under this Agreement to any third party for indirect, special, punitive, or
consequential loss or damage of any kind whatsoever, including lost profits,
whether or not the likelihood of such loss or damage was known to the Collateral
Agent, or any of its officers, employees or agents, incurred without any act or
deed that is found to be attributable to gross negligence on the part of the
Collateral Agent, its officers, employees or agents.
(m) The Purchase Contract Agent. The duties and responsibilities of the
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Purchase Contract Agent under this Agreement shall in each case be governed by
Article VII of the Purchase Contract Agreement.
Section 7. Amendment.
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(a) Amendment Without Consent of Holders. Without the consent of any
------------------------------------
Holders, the Company, the Collateral Agent and the Purchase Contract Agent, at
any time and from time to time, may amend this Agreement, in form satisfactory
to the Company, the Collateral Agent and the Purchase Contract Agent, for any of
the following purposes:
(i) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company; or
(ii) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(iii) to evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent or Purchase Contract Agent; or
(iv) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other such provisions herein, or
to make any other provisions with respect to such matters or questions
arising under this Agreement, provided such action shall not adversely
affect the interests of the Holders.
(b) Amendment with Consent of Holders. With the consent of the Holders of
---------------------------------
not less than ______% of the Outstanding Securities, by Act of said Holders
delivered to the Company, the Purchase Contract Agent and the Collateral Agent,
the Company when authorized by a Board Resolution, the Purchase Contract Agent
and the Collateral Agent may amend this Agreement for the purpose of modifying
in any manner the provisions of this Agreement or the rights of the Holders in
respect of the Securities; provided, however, that no such supplemental
agreement shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(i) change the amount or type of Treasury Notes underlying a
Security, impair the right of the Holder of any Security to receive
interest payments on the underlying Treasury Notes or otherwise adversely
affect the Holder's rights in or to such Treasury Notes; or
(ii) change any Payment Date;
(iii) impair the right to institute suit for the enforcement of any
Purchase Contract.
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(iv) otherwise effect any action that would require the consent of the
Holder of each Outstanding Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an agreement
supplemental thereto; or
(v) reduce the percentage of Outstanding Securities the consent of
whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
(c) Execution of Amendments. In executing any amendment permitted by this
-----------------------
Section, the Collateral Agent and the Purchase Contract Agent shall be entitled
to receive and (subject to Section 6(a) hereof, with respect to the Collateral
Agent, and Section 7.01 of the Purchase Contract Agreement, with respect to the
Purchase Contract Agent) shall be fully protected in relying upon an Opinion of
Counsel stating that the execution of such amendment is authorized or permitted
by this Agreement and that all conditions precedent to such execution and
delivery have been satisfied.
(d) Effect of Amendments. Upon the execution of any amendment under this
--------------------
Section, this Agreement shall be modified in accordance therewith, and such
amendment shall form a part of this Agreement for all purposes; and every Holder
of Security Certificates theretofore or thereafter authenticated, executed on
behalf of the Holders and delivered under the Purchase Contract Agreement shall
be bound thereby.
(e) Reference to Amendments. Security Certificates authenticated, executed
-----------------------
on behalf of the Holders and delivered after the execution of any amendment
pursuant to this Section may, and shall if required by the Collateral Agent or
the Purchase Contract Agent, bear a notation in a form approved by the Purchase
Contract Agent and the Collateral Agent as to any matter provided for in such
amendment. If the Company shall so determine, new Security Certificates so
modified as to conform, in the opinion of the Collateral Agent, the Purchase
Contract Agent and the Company, to any such amendment may be prepared and
executed by the Company and authenticated, executed on behalf of the Holders and
delivered by the Purchase Contract Agent in accordance with the Purchase
Contract Agreement in exchange for Outstanding Security Certificates.
Section 8. Miscellaneous.
14
(a) No Waiver. No failure on the part of the Collateral Agent or any of
---------
its agents to exercise, and no course of dealing with respect to, and no delay
in exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Collateral Agent or any
of its agents of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
(b) Governing Law. THIS AGREEMENT, THE COLLATERAL ACCOUNT, AND PERFECTION
-------------
AND THE EFFECT OF PERFECTION OR NON-PERFECTION AND THE PRIORITY OF THE SECURITY
INTEREST IN THE TREASURY NOTES OR ANY SECURITY ENTITLEMENT WITH RESPECT THERETO
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, AND THE SECURITIES INTERMEDIARY'S JURISDICTION WILL BE THE STATE OF
NEW YORK FOR PURPOSES OF 31 C.F.R. (S)357.11(b), AS AMENDED, AND ANY SIMILAR
STATE LAW. The Company, the Collateral Agent and the Holders from time to time
of the Securities, acting through the Purchase Contract Agent as their attorney-
in-fact, hereby submit to the nonexclusive jurisdiction of the United States
District Court for the Southern District of New York and of any New York state
court sitting in New York City for the purposes of all legal proceedings arising
out of or relating to this Agreement or the transactions contemplated hereby.
The Company, the Collateral Agent and the Holders from time to time of the
Securities, acting through the Purchase Contract Agent as their attorney-in-
fact, irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
(c) Notices. All notices, requests, consents and other communications
-------
provided for herein (including, without limitation, any modifications of, or
waivers or consents under, this Agreement) shall be given or made in writing
(including, without limitation, by telecopy) delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof or, as to any party, at such other address as shall be designated by such
party in a notice to the other parties. Except as otherwise provided in this
Agreement, all such communications shall be deemed to have been duly given when
transmitted by telecopier or personally delivered or, in the case of a mailed
notice, upon receipt, in each case given or addressed as aforesaid.
(d) Successors and Assigns. This Agreement shall be binding upon and inure
----------------------
to the benefit of the respective successors and assigns of the Company, the
15
Collateral Agent and the Purchase Contract Agent, and the Holders from time to
time of the Securities, by their acceptance of the same, shall be deemed to have
agreed to be bound by the provisions hereof and to have ratified the agreements
of, and the grant of the Pledge hereunder by, the Purchase Contract Agent.
(e) Counterparts. This Agreement may be executed in any number of
------------
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
(f) Severability. If any provision hereof is invalid and unenforceable in
------------
any jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
(g) Expenses, etc. The Company agrees to reimburse the Collateral Agent
--------------
for: (a) all reasonable out-of-pocket costs and expenses of the Collateral Agent
(including, without limitation, the reasonable fees and expenses of counsel to
the Collateral Agent), in connection with (i) the negotiation, preparation,
execution and delivery or performance of this Agreement and (ii) any
modification, supplement or waiver of any of the terms of this Agreement; (b)
all reasonable costs and expenses of the Collateral Agent (including, without
limitation, reasonable fees and expenses of counsel) in connection with (i) any
enforcement or proceedings resulting or incurred in connection with causing any
Holder of Securities to satisfy its obligations under the Purchase Contracts
forming a part of the Securities and (ii) the enforcement of this Section 8(g);
and (c) all transfer, stamp, documentary or other similar taxes, assessments or
charges levied by any governmental or revenue authority in respect of this
Agreement or any other document referred to herein and all costs, expenses,
taxes, assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
hereby.
(h) Security Interest Absolute. All rights of the Collateral Agent and
--------------------------
security interests hereunder, and all obligations of the Holders from time to
time of the Securities hereunder, shall be absolute and unconditional
irrespective of:
(i) any lack of validity or enforceability of any provision of the
Purchase Contracts or the Securities or any other agreement or instrument
relating thereto;
16
(ii) any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the
obligations of Holders of Securities under the related Purchase Contracts,
or any other amendment or waiver of any term of, or any consent to any
departure from any requirement of, the Purchase Contract Agreement or any
Purchase Contract or any other agreement or instrument relating thereto; or
(iii) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a
pledgor.
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
Household International, Inc.
By: _______________________________
Name:
Title:
Address for Notices:
Household International, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: _____________
Telecopy: (847) ________
____________________
as Purchase Contract Agent and as
attorney-in-fact of the Holders from time to
time of the Securities
By: _______________________________
Name: _________________________
Title: ________________________
Address for Notices:
____________________
____________________
____________________
____________________
Attention: ______________________
______________________
Telecopy: (___)__________________
__________________________________
as Collateral Agent and Securities
Intermediary with respect to
the Collateral Account and as
Securities Intermediary with respect to
any Treasury Notes credited to the
Collateral Account
By: ______________________________
Name: ________________________
Title: _______________________
Address for Notices:
__________________________________
__________________________________
__________________________________
__________________________________
Attention: _______________
_______________
Telecopy: (___)___________
