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EXHIBIT 1
SELLING AGENT AGREEMENT
by and among
Household Finance Corporation,
Incapital, LLC (as Purchasing Agent)
and the
Agents named herein
March __, 2001
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March __, 2001
To Incapital, LLC and the Agents listed on
the signature page hereto.
Household Finance Corporation, a Delaware corporation (the "Company"),
proposes to issue and sell up to $1,000,000,000 aggregate principal amount of
its HFC InterNotes(SM) due nine months or more from date of issue (the "Notes").
The Notes will constitute a part of a series of senior debt securities,
unlimited as to aggregate principal amount, to be issued pursuant to the
Indenture (the "Indenture") dated as of March 1, 2001, between the Company and
The Chase Manhattan Bank, as trustee (the "Trustee"), which incorporates therein
the terms and conditions of the Standard Multiple-Series Indenture Provisions
for Senior Debt Securities dated as of June 1, 1992. The terms of the Notes are
described in the Prospectus referred to below.
Subject to the terms and conditions contained in this Selling
Agent Agreement (the "Agreement"), the Company hereby (1) appoints Incapital,
LLC, as purchasing agent (the "Purchasing Agent"), (2) appoints each of the
other parties listed on the signature page as agent of the Company ("Agent") for
the purpose of soliciting offers to purchase the Notes and each of the Agents
hereby agrees to use reasonable best efforts to solicit offers to purchase Notes
upon terms acceptable to the Company at such times and in such amounts as the
Company shall from time to time specify and in accordance with the terms hereof,
and, after consultation with the Purchasing Agent and (3) agrees that whenever
the Company determines to sell Notes pursuant to this Agreement, such Notes
shall be sold pursuant to a Terms Agreement (as defined herein) relating to such
sale in accordance with the provisions of Section V hereof between the Company
and the Purchasing Agent, with the Purchasing Agent purchasing such Notes as
principal for resale to the Agents or dealers (the "Selected Dealers"), each of
whom will purchase such notes as principal. The Company reserves the right to
enter into agreements substantially identical hereto with other agents, subject
to prior notification to the Purchasing Agent of any such agreements.
I.
The Company has filed with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (Registration No.
333-_______ ) relating to the Notes and the offering thereof, from time to time,
in accordance with Rule 415 under the Securities Act of 1933, as amended (the
"1933 Act") (such registration statement, including all exhibits thereto but
excluding Form T-1, as amended at the time such registration statement or any
part thereof became effective, being hereinafter called the "Registration
Statement"). Such Registration Statement has been declared effective by the SEC,
and the Indenture has been qualified under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"). The prospectus relating to the Notes
constituting part of the Registration Statement, including the documents
incorporated
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by reference therein as of the effective date of the Registration Statement, and
as from time to time amended or supplemented (including by the filing of
documents incorporated therein by reference and by any Pricing Supplement (as
herein defined)) shall hereinafter be referred to as the "Prospectus."
II.
The obligations hereunder of the Purchasing Agent and the
Agents are subject to the following conditions:
(a) On the date hereof, the Purchasing Agent and the Agents shall have
received the following legal opinions, dated as of the date hereof and in form
and substance satisfactory to them:
(1) The opinion of ▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President - Corporate Law
of Household International, Inc., the parent of the Company, or other
counsel to the Company satisfactory to the Purchasing Agent and the
Agents that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware;
(ii) The significant subsidiaries, as defined in Rule 1-02 of Regulation S-X of
the SEC (the "significant subsidiaries"), of the Company are validly organized
and existing corporations under the laws of their respective jurisdictions of
incorporation;
(iii) The Company and its significant subsidiaries are duly authorized under
statutes which regulate the business of insurance or the business of making
loans or of financing the sale of goods (commonly called "small loan laws,"
"consumer finance laws," or "sales finance laws"), or are permitted under the
general interest statutes and related laws and court decisions, to conduct in
the various jurisdictions in which they do business the respective businesses
therein conducted by them as described in the Prospectus, except where failure
to be so permitted or failure to be so authorized will not have a material
adverse effect on the business or consolidated financial condition of the
Company and its subsidiaries taken as a whole;
(iv) The Company has an authorized capitalization as set forth in the Prospectus
and all of the outstanding shares of its common stock have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned of record
and beneficially by the Company's parent, Household International, Inc.;
(v) To the best of such counsel's knowledge, there are no legal or governmental
proceedings pending, other than those referred to or incorporated in the
Prospectus, to which the Company or any of its subsidiaries is a party or of
which any property of the Company or any of its subsidiaries is the subject
which individually or in the aggregate is material, and, to the best of such
counsel's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
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(vi) This Agreement has been duly authorized, executed and delivered by the
Company;
(vii) The Indenture has been duly authorized, executed and delivered by the
Company, and constitutes a valid and legally binding instrument of the Company
enforceable in accordance with its terms except as enforcement of the provisions
thereof may be limited by bankruptcy, insolvency, reorganization or other laws
relating to or affecting the enforcement of creditors' rights or by general
principles of equity; the Indenture has been duly qualified under the Trust
Indenture Act; and all taxes and fees required to be paid with respect to the
execution of the Indenture and the issuance of the Notes have been paid;
(viii) The Notes have been duly authorized and, when the Notes have been duly
executed, authenticated, issued and delivered in accordance with the provisions
of the Indenture, the applicable board resolutions and this Agreement, against
payment of the agreed consideration therefor, the Notes will constitute valid
and legally binding obligations of the Company and, with like exceptions as
noted in subdivision (vii) above, will be entitled to the benefits provided by
the Indenture; and the Notes and the Indenture conform to the descriptions
thereof in the Prospectus;
(ix) The issue and sale of the Notes, and the compliance by the Company with all
of the provisions of the Notes, the Indenture, this Agreement and any Terms
Agreement will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any of the property or assets
of the Company or any of its subsidiaries pursuant to the terms of, any
indenture, mortgage, deed of trust, loan agreement, or other agreement or
instrument, known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries may
be bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject (except for conflicts, breaches and defaults which would
not, individually or in the aggregate, be materially adverse to the Company and
its subsidiaries taken as a whole or materially adverse to the transactions
contemplated by this Agreement) nor will such action result in any violation of
the provisions of the charter or the by-laws of the Company or any of its
subsidiaries or, to the best of such counsel's knowledge, any statute or any
order, rule or regulation applicable to the Company or any of its subsidiaries
of any court or of any Federal, state or other regulatory authority or other
governmental body having jurisdiction over the Company or any of its
subsidiaries; and no consent, approval, authorization, order, registration or
qualification of or with any court or any such regulatory authority or other
governmental body is required for the issue and sale of the Notes or the
consummation of the other transactions contemplated in this Agreement and any
Terms Agreement, except the registration under the 1933 Act of the Notes, the
qualification of the Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or Blue Sky Laws in connection with the public offering
of the Notes by the Agents;
(x) The documents incorporated by reference in the Prospectus (other than the
financial statements and related schedules therein, as to which such counsel
need express no opinion), when they became effective or were filed with the SEC,
as the case may be, complied as to form in all material respects with the
requirements of the 1933 Act or the Securities Exchange Act of
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1934, as amended (the "1934 Act"), as applicable, and the General Rules and
Regulations of the 1933 Act (the "1933 Act Regulations") or the General Rules
and Regulations of the 1934 Act (the "1934 Act Regulations"), as applicable; and
such counsel has no reason to believe that any of such documents, when they
became effective or were so filed, as the case may be, contained, in the case of
documents which became effective under the 1933 Act, an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, and, in the case of
documents which were filed under the 1934 Act with the SEC, an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading;
(xi) The Registration Statement has become and is now effective under the 1933
Act and, no proceedings for a stop order in respect of the Registration
Statement are pending or to the best of such counsel's knowledge, threatened
under Section 8(d) or 8(e) of the 1933 Act; and
(xii) The Registration Statement and the Prospectus and any further amendments
and supplements thereto made by the Company prior to the date hereof (other than
the financial statements and related schedules therein, as to which such counsel
need express no opinion) comply as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and the Trust
Indenture Act and the rules and regulations thereunder.
Such counsel shall also state that such counsel has no reason to believe that
the Registration Statement or any amendment thereof (including the filing of any
annual report on Form 10-K) at the time it became effective contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that the Prospectus as of its date and at the date hereof contained or contains
any untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and such counsel does
not know of any contracts or other documents of a character required to be filed
as an exhibit to the Registration Statement or required to be incorporated by
reference into the Prospectus or required to be described in the Registration
Statement or the Prospectus which are not filed or incorporated by reference or
described as required;
(2) The opinion of ▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇, counsel to the
Purchasing Agent and the Agents, with respect to this Agreement, the
validity of the Indenture, the Notes, the Registration Statement, the
Prospectus and other related matters as you may reasonably request, and
such counsel shall have received such documents, certificates and
information as they may reasonably request to enable them to pass upon
such matters.
(b) On the date hereof, the Purchasing Agent and the Agents shall have
received a certificate of the President or any Vice President or any other
authorized officer of the Company satisfactory to them (each, an "Authorized
Officer"), dated as of the date hereof, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the Prospectus
and this Agreement and that to the best of their knowledge (i) since the
respective dates as of which information is given in the Registration Statement
and the Prospectus, there has not been
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any material adverse change in the condition, financial or otherwise, earnings
or business affairs of the Company and its subsidiaries considered as one
enterprise, whether or not arising from transactions in the ordinary course of
business, except as set forth or contemplated in the Prospectus, (ii) the other
representations and warranties of the Company contained in this Agreement are
true and correct in all material respects with the same force and effect as
though expressly made at and as of the date of such certificate, (iii) the
Company has performed or complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to the
date of such certificate, (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or threatened by the SEC and (v) no litigation or proceeding
shall be threatened or pending to restrain or enjoin the issuance or delivery of
the Notes, or which in any way affects the validity of the Notes.
(c) On the date hereof, the Purchasing Agent and the Agents shall have
received a letter from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇") dated as of the
date hereof and in form and substance satisfactory to them, to the effect that:
(i) They are independent public accountants with respect to the Company
and its subsidiaries within the meaning of the 1933 Act and the 1933
Act Regulations.
(ii) In their opinion, the consolidated financial statements of the
Company and its subsidiaries audited by them and included or
incorporated by reference in the Registration Statement and Prospectus
comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act Regulations
with respect to registration statements on Form S-3 and the 1934 Act
and the 1934 Act Regulations.
(iii) On the basis of procedures (but not an audit in accordance with
generally accepted auditing standards) consisting of:
(a) Reading the minutes of the meetings of the board
of directors and committees of the board of directors of the
Company and its parent, Household International, Inc., as set
forth in the minute books through a specified date not more
than five business days prior to the date of delivery of such
letter;
(b) Performing the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in SAS
No. 71, Interim Financial Information, on the unaudited
condensed consolidated interim financial statements of the
Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement and
Prospectus and reading the unaudited interim financial data,
if any, for the period from the date of the latest balance
sheet included or incorporated by reference in the
Registration Statement and Prospectus to the date of the
latest available interim financial data; and
(c) Making inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters regarding the specific items for which representations
are requested below;
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nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
(1) the unaudited condensed consolidated interim
financial statements, included or incorporated by reference in
the Registration Statement and Prospectus, do not comply as to
form in all material respects with the applicable accounting
requirements of the 1934 Act and the 1934 Act Regulations
thereunder;
(2) any material modifications should be made to the
unaudited condensed consolidated interim financial statements,
included or incorporated by reference in the Registration
Statement and Prospectus, for them to be in conformity with
generally accepted accounting principles;
(3) (i) at the date of the latest available interim
financial statements, there was any change in net charge-offs
of finance receivables owned, any change in revenue, or any
change in net income as compared to the corresponding period
in the prior year, or (ii) there was any change in senior and
senior subordinated debt (with original maturities over one
year), or any change in commercial paper, bank or other
borrowings, as compared with the corresponding amounts
included in the most recent audited financial statements of
the Company incorporated by reference in the Registration
Statement and Prospectus, except in all instances for changes
or decreases which the Registration Statement and Prospectus
disclose have occurred or may occur, or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall
state any specific changes.
(iv) The letter shall also state that ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ has
carried out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information which are included or incorporated by reference in the
Registration Statement and Prospectus and which are specified by the
Purchasing Agent and the Agents and agreed to by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, and
has found such amounts, percentages and financial information to be in
agreement with the relevant accounting, financial and other records of
the Company and its subsidiaries identified in such letter.
(d) On the date hereof, counsel to the Purchasing Agent and the Agents
shall have been furnished with such documents and opinions as such counsel may
reasonably require for the purpose of enabling such counsel to pass upon the
issuance and sale of Notes as herein contemplated, or in order to evidence the
accuracy and completeness of any of the representations and warranties, or the
fulfillment of any of the conditions, contained herein; and all proceedings
taken by the Company in connection with the issuance and sale of Notes as herein
contemplated shall be satisfactory in form and substance to such counsel and to
the Purchasing Agent and the Agents.
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The obligations of the Purchasing Agent to purchase Notes as principal
under any Terms Agreement are subject to the conditions that (i) no litigation
or proceeding shall be threatened or pending to restrain or enjoin the issuance
or delivery of the Notes, or which in any way questions or affects the validity
of the Notes, (ii) no stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no proceedings for such purpose
shall be pending before or threatened by the SEC, (iii) the ratings assigned by
any nationally recognized statistical rating organization, as that term is
defined by the SEC for purpose of Rule 436(g) promulgated under the 1933 Act, to
any senior debt securities of the Company as of the date of such Terms Agreement
shall have been lowered since that date, and (iv) there shall not have come to
the Purchasing Agent's attention any facts that would cause the Purchasing Agent
to believe that the Prospectus as amended or supplemented at the time it was
required to be delivered to a purchaser of Notes, contained an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in light of the circumstances existing at such
time, not misleading. Each of such conditions shall be met on the date of the
Terms Agreement and on the corresponding Settlement Date (as defined herein).
Further, if specifically called for by any Terms Agreement, the Purchasing
Agent's obligations hereunder and under such Terms Agreement shall be subject to
such additional conditions, including those set forth in clauses (a), (b) and
(c) above, as agreed to by the parties, each of which such agreed conditions
shall be met on the corresponding Settlement Date.
III.
In further consideration of your agreements herein contained,
the Company covenants as follows:
(a) The Company will notify the Purchasing Agent and the Agents
immediately of (i) the effectiveness of any amendment to the Registration
Statement, (ii) the filing of any amendment or supplement to the Prospectus
(other than a Pricing Supplement), (iii) the receipt of any comments from the
SEC with respect to the Registration Statement or the Prospectus or any document
filed with the SEC pursuant to the 1934 Act which is or will be incorporated by
reference in the Registration Statement and the Prospectus, (iv) any request by
the SEC for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information relating thereto or
with respect to a document filed with the SEC pursuant to the 1934 Act which is
or will be incorporated by reference in the Registration Statement and the
Prospectus, and (v) the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) The Company will give the Purchasing Agent and the Agents notice of
its intention to file or prepare any additional registration statement with
respect to the registration of additional Notes or any amendment to the
Registration Statement or any amendment or supplement to the Prospectus (other
than an amendment or supplement effected by the filing of a document with the
SEC pursuant to the ▇▇▇▇ ▇▇▇) and, upon request, will furnish the Purchasing
Agent and the Agents with copies of any such registration statement or amendment
or supplement proposed to be filed or prepared a reasonable time in advance of
such proposed filing or
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preparation, as the case may be, and will not file any such registration
statement or amendment or supplement in a form as to which the Purchasing Agent
or the Agents or your counsel reasonably object.
(c) The Company will deliver to the Purchasing Agent and the Agents
without charge, a copy of (i) the Indenture, (ii) the Registration Statement (as
originally filed) and of each amendment thereto (including exhibits filed
therewith and documents incorporated by reference in the Prospectus) and (iii) a
certified copy of the corporate authorization of the issuance and sale of the
Notes. The Company will furnish to the Purchasing Agent and the Agents as many
copies of the Prospectus (as amended or supplemented) as they shall reasonably
request so long as the Agents are required to deliver a Prospectus in connection
with sales or solicitations of offers to purchase the Notes under the 1933 Act.
(d) The Company will prepare, with respect to any Notes to be sold
pursuant to this Agreement, a pricing supplement with respect to such Notes in
substantially the form attached as Exhibit D (a "Pricing Supplement") and will
file such Pricing Supplement with the SEC pursuant to Rule 424(b) under the 1933
Act not later than the close of business on the second business day after the
date on which such Pricing Supplement is first used.
(e) Except as otherwise provided in subsection (k) of this Section, if
at any time during the term of this Agreement any event shall occur or condition
exist as a result of which it is necessary, in the reasonable opinion of your
counsel or counsel for the Company, to further amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein not misleading in light of the circumstances existing at
the time the Prospectus is delivered to a purchaser, or if it shall be
necessary, in the reasonable opinion of either such counsel, to amend or
supplement the Registration Statement or the Prospectus in order to comply with
the requirements of the 1933 Act or the 1933 Act Regulations, immediate notice
shall be given, and confirmed in writing, to the Agents to cease the
solicitation of offers to purchase the Notes and to cease sales of any Notes by
the Purchasing Agent, and the Company will promptly prepare and file with the
SEC such amendment or supplement, whether by filing documents pursuant to the
1934 Act, the 1933 Act or otherwise, as may be necessary to correct such untrue
statement or omission or to make the Registration Statement and Prospectus
comply with such requirements.
(f) Except as otherwise provided in subsection (k) of this Section, on
or prior to the date on which there shall be released to the general public
interim financial statement information related to the Company with respect to
each of the first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the Company shall furnish
promptly such information to the Purchasing Agent and the Agents, confirmed in
writing, and thereafter shall cause promptly the Prospectus to be amended or
supplemented to include or incorporate by reference financial information with
respect thereto, as well as such other information and explanations as shall be
necessary for an understanding thereof, as may be required by the 1933 Act or
the 1934 Act or otherwise.
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(g) Except as otherwise provided in subsection (k) of this Section, on
or prior to the date on which there shall be released to the general public
financial information included in or derived from the audited financial
statements of the Company for the preceding fiscal year, the Company shall
furnish promptly such information to the Purchasing Agent and the Agents and
thereafter shall cause promptly the Registration Statement and the Prospectus to
be amended to include or incorporate by reference such audited financial
statements and the report or reports, and consent or consents to such inclusion
or incorporation by reference, of the independent accountants with respect
thereto, as well as such other information and explanations as shall be
necessary for an understanding of such financial statements, as may be required
by the 1933 Act or the 1934 Act or otherwise.
(h) The Company will make generally available to its security holders
as soon as practicable, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Section 11(a) and of Rule 158 under the ▇▇▇▇ ▇▇▇) covering each twelve-month
period beginning, in each case, not later than the first day of the Company's
fiscal quarter next following the "effective date" (as defined in such Rule 158)
of the Registration Statement with respect to each sale of Notes.
(i) The Company will endeavor to qualify the Notes for offering and
sale under the applicable securities laws of such states and other jurisdictions
of the United States as the Purchasing Agent and the Agents may designate and
will maintain such qualifications in effect for as long as may be required for
the distribution of the Notes; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation in any jurisdiction in which it is not so qualified. The
Company will file such statements and reports as may be required by the laws of
each jurisdiction in which the Notes have been qualified as above provided. The
Company will promptly advise the Purchasing Agent and the Agents of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Notes for sale in any such state or jurisdiction or the
initiating or threatening of any proceeding for such purpose.
(j) The Company, during the period when the Prospectus is required to
be delivered under the 1933 Act, will file promptly all documents required to be
filed with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934
Act.
(k) The Company shall not be required to comply with the provisions of
subsections (e), (f) or (g) of this Section or the provisions of Sections
VII (b), (c) and (d) during any period from the time (i) the Agents have
suspended solicitation of purchases of the Notes pursuant to a direction from
the Company and (ii) the Agents shall not then hold any Notes as principal
purchased from the Purchasing Agent to the time the Company shall determine that
solicitation of purchases of the Notes should be resumed or shall subsequently
agree for the Purchasing Agent to purchase Notes as principal.
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IV.
(a) The Agents propose to solicit offers to purchase the Notes upon
the terms and conditions set forth herein and in the Prospectus and upon the
terms communicated to the Agents from time to time by the Purchasing Agent. For
the purpose of such solicitation the Agents will use the Prospectus as then
amended or supplemented which has been most recently distributed to the Agents
by the Company, and the Agents will solicit offers to purchase only as permitted
or contemplated thereby and herein and will solicit offers to purchase the Notes
only as permitted by the 1933 Act and the applicable securities laws or
regulations of any jurisdiction. The Company reserves the right, in its sole
discretion, to suspend solicitation of offers to purchase the Notes commencing
at any time for any period of time or permanently. Upon receipt of instructions
(which may be given orally) from the Company to the Purchasing Agent, the Agents
will suspend promptly solicitation of offers to purchase until such time as the
Company has advised the Purchasing Agent that such solicitation may be resumed.
Unless otherwise instructed by the Company, the Agents are
authorized to solicit offers to purchase the Notes only in denominations of
$1,000 or more (in multiples of $1,000). The Agents are not authorized to
appoint subagents or to engage the services of any other broker or dealer in
connection with the offer or sale of the Notes without the consent of the
Company. Unless otherwise instructed by the Company, the Purchasing Agent shall
communicate to the Company, orally or in writing, each offer to purchase Notes.
The Company shall have the sole right to accept offers to purchase Notes and may
reject any proposed offers to purchase Notes as a whole or in part. The
Purchasing Agent and each Agent shall have the right, in its discretion
reasonably exercised, to reject any proposed purchase of Notes, as a whole or in
part, and any such rejection shall not be deemed a breach of its agreements
contained herein. The Company agrees to pay the Purchasing Agent, as
consideration for soliciting offers to purchase Notes pursuant to a Terms
Agreement, a concession in the form of a discount equal to the percentages of
the initial offering price of each Note actually sold as set forth in Exhibit A
hereto (the "Concession"). The Purchasing Agent and the Agents will share the
above-mentioned Concession with Agents and the Selected Dealers, as applicable,
in such proportions as they may agree.
Unless otherwise authorized by the Company, all Notes shall be
sold to the public at a purchase price not to exceed 100% of the principal
amount thereof, plus accrued interest, if any. Such purchase price shall be set
forth in the confirmation statement of the Agent or Selected Dealer responsible
for such sale and delivered to the purchaser along with a copy of the Prospectus
(if not previously delivered) and Pricing Supplement.
(b) Procedural details relating to the issue and delivery of, and the
solicitation of purchases and payment for, the Notes are set forth in the
Administrative Procedures attached hereto as Exhibit B (the "Procedures"), as
amended from time to time. The provisions of the Procedures shall apply to all
transactions contemplated hereunder unless otherwise provided in a Terms
Agreement. The Company, the Purchasing Agent and the Agents each agree to
perform the respective duties and obligations specifically provided to be
performed by each in the Procedures as amended from time to time. The Procedures
may only be amended by written agreement of the Company, the Purchasing Agent
and the Agents.
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(c) The Company, the Purchasing Agent and each Agent acknowledges and
agrees, and each Selected Dealer will be required to acknowledge and agree, that
the Notes are being offered for sale in the United States only.
V.
Each sale of Notes shall be made in accordance with the terms of this
Agreement and a separate agreement in substantially the form attached as Exhibit
C (a "Terms Agreement") to be entered into which will provide for the sale of
such Notes to, and the purchase and reoffering thereof, by the Purchasing Agent
as principal. A Terms Agreement may also specify certain provisions relating to
the reoffering of such Notes by the Purchasing Agent. The offering of Notes by
the Company hereunder and the Purchasing Agent's agreement to purchase Notes
pursuant to any Terms Agreement shall be deemed to have been made on the basis
of the representations, warranties and agreements of the Company herein
contained and shall be subject to the terms and conditions herein set forth.
Each Terms Agreement shall describe the Notes to be purchased pursuant thereto
by the Purchasing Agent as principal, and may specify, among other things, the
principal amount of Notes to be purchased, the interest rate and stated maturity
date or dates of such Notes, the interest payment dates, if any, the net
proceeds to the Company, the initial public offering price at which the Notes
are proposed to be reoffered, and the time and place of delivery of and payment
for such Notes (the "Settlement Date"), whether the Notes provide for a
Survivor's Option, whether the Notes are redeemable or repayable and on what
terms and conditions, and any other relevant terms. In connection with the
resale of the Notes purchased, without the consent of the Company, the Agents
are not authorized to appoint subagents or to engage the service of any other
broker or dealer, nor may the Agents reallow any portion of the Concession paid
to them. Terms Agreements, each of which shall be substantially in the form of
Exhibit C hereto, or as otherwise agreed to between the Company and the
Purchasing Agent, may take the form of an exchange of any standard form of
written telecommunication between the Purchasing Agent and the Company.
VI.
The Company represents and warrants to the Purchasing Agent and the
Agents as of the date hereof, as of the date of each Terms Agreement, as of each
Settlement Date, and as of any time that the Registration Statement or the
Prospectus shall be amended or supplemented or there is filed with the SEC any
document incorporated by reference into the Prospectus (each of the times
referenced above being referred to herein as a "Representation Date") as
follows:
(a) The Registration Statement has been filed with the SEC in the form
heretofore delivered to you and such Registration Statement in such form
has been declared effective by the SEC and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or threatened by the SEC;
(b) The documents incorporated by reference in the Prospectus, when they became
effective or were filed with the SEC, as the case may be, conformed in all
material respects to the
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requirements of the 1933 Act or the 1934 Act, as applicable, and the 1933
Act Regulations and 1934 Act Regulations, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus and any amendments or
supplements thereto, when they become effective or are filed with the SEC,
as the case may be, will conform in all material respects to the
requirements of the 1933 Act or the 1934 Act, as applicable, and the rules
and regulations of the SEC thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by the
Purchasing Agent or any Agent expressly for use in the Prospectus as
amended or supplemented to relate to a particular issuance of Notes;
(c) The Registration Statement and the Prospectus conform, and any amendments
or supplements thereto will conform, when they become effective or are
filed with the SEC, as the case may be, and as of each subsequent
Representation Date will conform, in all material respects to the
requirements of the 1933 Act, the 1933 Act Regulations and the Trust
Indenture Act and the rules and regulations of the SEC thereunder and do
not and will not as of its effective date as to the Registration Statement
and as of its filing date and as of each Representation Date as to the
Prospectus contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by any Agent expressly for use in the Prospectus as
amended or supplemented to relate to a particular issuance of Notes;
(d) The financial statements included or incorporated by reference in the
Registration Statement present fairly the financial position of the Company
and subsidiaries as of the dates indicated and the results of their
respective operations for the periods specified; and said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a basis which is consistent in all
material respects during the periods involved;
(e) The Company and its significant subsidiaries are validly organized and
existing corporations under the laws of their respective jurisdictions of
incorporation; and the Company and its significant subsidiaries are duly
authorized under statutes which regulate the business of making loans or of
financing the sale of goods (commonly called "small loan laws," or "sales
finance laws"), or are permitted under the general interest statutes and
related laws and court decisions to conduct in the various jurisdictions in
which they do business the respective businesses therein conducted by them
as described in the Prospectus except where failure to be so authorized or
permitted will not have a material adverse effect on the business or
consolidated financial condition of the Company and its subsidiaries taken
as a whole;
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(f) There are no legal or governmental proceedings pending, other than those
referred to in the Prospectus, to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject, other than proceedings which are not
reasonably expected, individually or in the aggregate, to have a material
adverse effect on the consolidated financial position, shareholders' equity
or results of operations of the Company and its subsidiaries taken as a
whole; and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(g) The Notes have been duly authorized, and, when issued and delivered
pursuant to this Agreement and any Terms Agreement and the Indenture will
have been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Company entitled to
the benefits provided by the applicable Indenture; the Indenture has been
duly qualified under the Trust Indenture Act and has been duly authorized,
executed and delivered by the Company and the Trustee and constitutes a
valid and legally binding instrument enforceable in accordance with its
terms except as the same may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement of
creditors' rights or by general principles of equity; and the Indenture
conforms to the description thereof in the Prospectus as originally filed
with the SEC, and the Notes will conform to the description thereof in the
Prospectus as amended or supplemented;
(h) The issue and sale of the Notes and the compliance by the Company with all
of the provisions of the Notes, the Indenture, this Agreement and any Terms
Agreement will not conflict with or result in a breach of any of the terms
or provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the property
or assets of the Company or any of its subsidiaries pursuant to the terms
of any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries may be bound or
to which any of the property or assets of the Company or any of its
subsidiaries is subject (except for conflicts, breaches and defaults which
would not, individually or in the aggregate, be materially adverse to the
Company and its subsidiaries taken as a whole or materially adverse to the
transactions contemplated by this Agreement), nor will such action result
in any violation of the provisions of the Restated Certificate of
Incorporation, as amended, or the By-Laws of the Company or any of its
subsidiaries or any statute or order, rule or regulation applicable to it,
of any court or any Federal, State or other regulatory authority or any
other governmental body having jurisdiction over it; and no consent,
approval, authorization, order, registration or qualification of or with
any court or other such regulatory authority or other governmental body is
required for the issue and sale of the Notes or the consummation of the
other transactions contemplated in this Agreement or any Terms Agreement
except the registration under the 1933 Act of the Notes, the qualification
of the Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as may be
required under State securities or Blue Sky laws in connection with the
purchase and distribution of the Notes by the Agents;
(i) The Company and its subsidiaries taken as a whole have not sustained since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus as
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amended or supplemented any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or decree; and since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as it may be
amended or supplemented there has not been any material change in the
capital stock or long-term debt of the Company (except for changes
resulting from the purchase by the Company of its outstanding securities
for sinking fund purposes) or any material adverse change in the general
affairs or management, or the consolidated financial position,
shareholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, otherwise than as set forth or contemplated
in the Prospectus as amended or supplemented; and
(j) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have certified certain financial statements
included or to be included in the Registration Statement and the
Prospectus, are independent public accountants as required by the 1933 Act
and the 1933 Regulations.
Any certificate signed by any Authorized Officer of the Company and
delivered to the Purchasing Agent or to counsel for the Purchasing Agent in
connection with an offering of Notes or the sale of Notes to the Purchasing
Agent as principal shall be deemed a representation and warranty by the Company
to the Agents as to the matters covered thereby on the date of such certificate
and at each Representation Date subsequent thereto.
All representations, warranties, covenants and agreements of the
Company contained in this Agreement or in certificates of officers of the
Company submitted pursuant hereto shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of the Purchasing
Agent or any Agent or any controlling person of the Purchasing Agent or any
Agent, or by or on behalf of the Company, and shall survive each delivery of and
payment for any of the Notes.
VII.
(a) Each acceptance by the Company of an offer for the purchase of
Notes, and each delivery of Notes to the Purchasing Agent pursuant to a sale of
Notes to the Purchasing Agent, shall be deemed to be an affirmation that the
representations and warranties of the Company made to the Purchasing Agent and
the Agents in this Agreement and in any certificate theretofore delivered
pursuant hereto are true and correct at the time of such acceptance or sale, as
the case may be, and an undertaking that such representations and warranties
will be true and correct at the time of delivery to the Purchasing Agent of the
Notes relating to such acceptance or sale, as the case may be, as though made at
and as of each such time (and it is understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as amended
and supplemented to each such time).
(b) Each time:
(i) the Company accepts a Terms Agreement requiring such updating
provisions;
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(ii) the Company files an Annual Report on Form 10-K or a
Quarterly Report on Form 10-Q with the SEC that is
incorporated by reference into the Prospectus;
(iii) the Company files a Current Report on Form 8-K required by
Item 2 of Form 8-K with the SEC that is incorporated by
reference into the Prospectus; or
(iv) if required by the Purchasing Agent or the Agents after the
Registration Statement or Prospectus has been amended or
supplemented (other than by an amendment or supplement
providing solely for interest rates, maturity dates or other
terms of Notes or similar changes),
the Company shall furnish or cause to be furnished to the
Purchasing Agent and the Agents a certificate of an Authorized
Officer dated the date specified in the applicable Terms Agreement
or dated the date of filing with the SEC of such supplement or
document or the date of effectiveness of such amendment, as the
case may be, in form satisfactory to the Purchasing Agent and the
Agents to the effect that the statements contained in the
certificate referred to in Section II(b) hereof which was last
furnished to the Purchasing Agent and the Agents are true and
correct as of the date specified in the applicable Terms Agreement
or at the time of such filing, amendment or supplement, as the
case may be, as though made at and as of such time (except that
such statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same
tenor as the certificate referred to in said Section II(b),
modified as necessary to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of delivery
of such certificate.
(c) Each time:
(i) the Company accepts a Terms Agreement requiring such
updating provisions;
(ii) the Company files an Annual Report on Form 10-K or a
Quarterly Report on Form 10-Q with the SEC that is
incorporated by reference into the Prospectus; or
(iii) if required by the Purchasing Agent or the Agents after:
(A) the Company files a Current Report on Form 8-K required
by Item 2 of Form 8-K with the SEC that is incorporated
by reference into the Prospectus; or
(B) the Registration Statement or Prospectus has been
amended or supplemented (other than by an amendment or
supplement providing solely for interest rates, maturity
dates or other terms of the Notes or similar changes),
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the Company shall furnish or cause to be furnished forthwith to
the Purchasing Agent and the Agents and your counsel the written
opinions of counsel to the Company, dated the date specified in
the applicable Terms Agreement or dated the date of filing with
the SEC of such supplement or document or the date of
effectiveness of such amendment, as the case may be, in form and
substance satisfactory to the Purchasing Agent and the Agents, of
the same tenor as the opinions referred to in Section II(a)(1)
hereof, but modified, as necessary, to relate to the Registration
Statement and the Prospectus as amended and supplemented to the
time of delivery of such opinions; or, in lieu of such opinions,
counsel last furnishing such opinions to the Purchasing Agent and
the Agents shall furnish the Purchasing Agent and the Agents with
a letter substantially to the effect that the Purchasing Agent and
the Agents may rely on such last opinion to the same extent as
though it was dated the date of such letter authorizing reliance
(except that statements in such last opinion shall be deemed to
relate to the Registration Statement and the Prospectus as amended
and supplemented to the time of delivery of such letter
authorizing reliance).
(d) Each time:
(i) the Company accepts a Terms Agreement requiring such
updating provisions;
(ii) the Company files an Annual Report on Form 10-K or a
Quarterly Report on Form 10-Q with the SEC that is
incorporated by reference into the Prospectus; or
(iii) if required by the Purchasing Agent or the Agents after:
(A) the Company files a Current Report on Form 8-K required
by Item 2 of Form 8-K with the SEC that is incorporated
by reference into the Prospectus; or
(B) the Registration Statement or Prospectus has been
amended or supplemented to include additional financial
information required to be set forth or incorporated by
reference into the Prospectus under the terms of Item 11
of Form S-3 under the 1933 Act,
the Company shall cause ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ to furnish the Purchasing Agent
and the Agents a letter, dated the date specified in the applicable
Terms Agreement or dated the date of effectiveness of such amendment,
supplement or document filed with the SEC, as the case may be, in form
satisfactory to the Purchasing Agent and the Agents, of the same tenor
as the portions of the letter referred to in clauses (i) and (ii) of
Section II(c) hereof but modified to relate to the Registration
Statement and Prospectus, as amended and supplemented to the date of
such letter, and of the same general tenor as the portions of the
letter referred to in clauses (iii) and (iv) of said Section II(c) with
such changes as may be necessary to reflect changes in the financial
statements and other information derived from the accounting records of
the Company; provided, however, that if the Registration Statement or
the Prospectus is amended or supplemented solely to include financial
information as of and for a fiscal quarter, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ may limit
the scope of such
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letter to the unaudited financial statements included in such amendment
or supplement. If any other information included therein is of an
accounting, financial or statistical nature, the Purchasing Agent and
the Agents may request procedures be performed with respect to such
other information. If ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is willing to perform and report
on the requested procedures, such letter should cover such other
information. Any letter required to be provided by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
hereunder shall be provided within 10 business days of the filing of
the Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the
case may be, within a reasonable time of a request made pursuant to
subparagraph (iii) hereof or on the date specified in an applicable
Terms Agreement.
VIII.
(a) The Company agrees to indemnify and hold harmless the Purchasing
Agent and each Agent and each person who controls the Purchasing Agent or any
Agent within the meaning of either the 1933 Act or the 1934 Act against any and
all losses, claims, damages or liabilities, joint or several, to which they or
any of them may become subject under the 1933 Act, the 1934 Act or other Federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement as originally filed
or in any amendment thereof, or arise out of or are based upon any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus, or any amendment or supplement thereof, or
arise out of or are based upon any omission or alleged omission to state therein
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, and agrees to reimburse each such indemnified party for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that (i) the Company will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchasing Agent or
Agent specifically for use in connection with the preparation thereof, or arises
out of or is based upon statements in or omissions from that part of the
Registration Statement which shall constitute the Statement of Eligibility and
Qualification of the Trustee (Form T-1) under the Trust Indenture Act of either
of the Trustees, and (ii) such indemnity with respect to the Prospectus shall
not inure to the benefit of any Agent (or any person controlling such Agent)
from whom the person asserting any such loss, claim, damage or liability
purchased the Notes which are the subject thereof if the Agent failed to deliver
a copy of the Prospectus as amended or supplemented to such person in connection
with the sale of such Notes excluding documents incorporated therein by
reference at or prior to the written confirmation of the sale of such Notes to
such person in any case where such delivery is required by the 1933 Act and the
untrue statement or omission of a material fact contained in the Prospectus was
corrected in the Prospectus as amended or supplemented. This indemnity agreement
will be in addition to any liability which the Company may otherwise have.
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(b) The Purchasing Agent and each Agent severally and not jointly
agrees to indemnify and hold harmless the Company, each of its directors, each
of its officers who signs the Registration Statement and each person who
controls the Company within the meaning of either the 1933 Act or the 1934 Act,
to the same extent as the foregoing indemnity from the Company to the Purchasing
Agent and each Agent, but only with reference to written information relating to
the Purchasing Agent or such Agent furnished to the Company by or on behalf of
the Purchasing Agent or such Agent specifically for use in the preparation of
the documents referred to in the foregoing indemnity, provided such information
is acknowledged in writing as having been provided by the Purchasing Agent or
such Agent for such purpose. This indemnity agreement will be in addition to any
liability which any Agent may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
VIII of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section VIII, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party except to the
extent, if any, that such failure materially prejudices the indemnifying party.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and, to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section VIII for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Purchasing Agent and the Agents in the case of
subparagraph (a), representing the indemnified parties under subparagraph (a)
who are parties to such action), (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action or (iii) the indemnifying party has authorized the employment of counsel
for the indemnified party at the expense of the indemnifying party; and except
that if clause (i) or (iii) is applicable, such liability shall be only in
respect of the counsel referred to in such clause (i) or (iii).
(d) To provide for just and equitable contribution in circumstances in
which the indemnification provided for in paragraph (a) of this Section VIII is
due in accordance with its
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terms but is for any reason held by a court to be insufficient or unavailable
from the Company on the grounds of policy or otherwise, the Company, on the one
hand, and the Purchasing Agent and the Agents on the other hand, shall
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) to which the Company and one or more of the Purchasing Agent and
the Agents may be subject in such proportion so that the Purchasing Agent and
each Agent is responsible for that portion represented by the percentage that
the total commissions and underwriting discounts received by the Purchasing
Agent and such Agents bears to the total sales price from the sale of Notes sold
to or through the Purchasing Agent and the Agents to the date of such liability,
and the Company is responsible for the balance. However, if the allocation
provided by the foregoing sentence is not permitted by applicable law, the
Company, on the one hand, and the Purchasing Agent and the Agents on the other
hand, shall contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) to which the Company and one or more of the
Purchasing Agent and the Agents may be subject in such proportion to reflect the
relative fault of the Company on the one hand and the Purchasing Agent and the
Agents on the other in connection with the statements or omissions or alleged
statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company, on the one hand,
or the Purchasing Agent or such Agents on the other hand, the parties' relative
intents, knowledge, access to information and opportunity to correct or prevent
such statement or omission, and any other equitable considerations appropriate
in the circumstances. The Company, on the one hand, and the Purchasing Agent and
the Agents on the other, agree that it would not be equitable if the amount of
such contribution were determined by pro rata or per capita allocation (even if
the Purchasing Agent and the Agents were treated as one entity for such purpose)
or by any other method of allocation that does not take into account the
equitable considerations referred to above in this paragraph (d).
Notwithstanding anything to the contrary contained herein, (i) in no case shall
the Purchasing Agent or an Agent be responsible for any amount in excess of the
commissions and underwriting discounts received by the Purchasing Agent or such
Agent in connection with the Notes from which such losses, liabilities, claims,
damages and expenses arise and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section VIII, each person who controls
the Purchasing Agent or any Agent within the meaning of the 1933 Act shall have
the same rights to contribution as the Purchasing Agent or such Agent, and each
person who controls the Company within the meaning of either the 1933 Act or the
1934 Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to
contribution as the Company, subject in each case to the provisions of this
paragraph (d). Any party entitled to contribution will, promptly after receipt
of notice of commencement of any action, suit or proceeding against such party
in respect of which a claim for contribution may be made against another party
or parties under this paragraph (d), notify such party or parties from whom
contribution may be sought, but the omission to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any other obligation it or they may have hereunder or otherwise than under this
paragraph (d).
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IX.
The Company may elect to suspend or terminate the offering of Notes
under this Agreement at any time; the Company also (as to the Purchasing Agent
or any one or more of the Agents) or any Agent (as to itself) may terminate the
appointment and arrangements described in this Agreement. Upon receipt of
instructions from the Company, the Purchasing Agent shall suspend or terminate
the participation of any Selected Dealer under the Master Selected Dealer
Agreement. Such actions may be taken, in the case of the Company, by giving
prompt written notice of suspension to the Purchasing Agent and all of the
Agents and by giving not less than 5 days' written notice of termination to the
affected party and the other parties to this Agreement, or in the case of an
Agent, by giving not less than 5 days' written notice of termination to the
Company and except that, if at the time of termination an offer for the purchase
of Notes shall have been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto shall not yet have
occurred, the Company shall have the obligations provided herein with respect to
such Note or Notes. The Company shall promptly notify the other parties in
writing of any such termination.
The Purchasing Agent may, and, upon the request of an Agent
with respect to any Notes being purchased by such Agent shall, terminate any
Terms Agreement hereunder by the Purchasing Agent to purchase such Notes,
immediately upon notice to the Company, at any time prior to the Settlement Date
relating thereto (i) if there has been, since the respective dates as of which
information is given in the Registration Statement, any material adverse change
in the condition, financial or otherwise, of the Company and its subsidiaries,
or in the earnings, affairs or business prospects of the Company and its
subsidiaries, taken as a whole, whether or not arising in the ordinary course of
business, or (ii) if there has occurred any outbreak or escalation of
hostilities or other calamity or crisis the effect of which on the financial
markets of the United States is such as to make it, in the Purchasing Agent's
judgment, impracticable to market the Notes or enforce contracts for the sale of
the Notes, or (iii) if trading in any debt securities of the Company has been
suspended by the SEC or a national securities exchange, or if trading generally
on either the American Stock Exchange or the New York Stock Exchange has been
suspended, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices for securities have been required, by either of said exchanges
or by order of the SEC or any other governmental authority, or if a banking
moratorium has been declared by either Federal or New York authorities.
Any Terms Agreement shall be subject to termination in the
Purchasing Agent's absolute discretion on the terms set forth or incorporated by
reference therein. The termination of this Agreement shall not require
termination of any agreement by the Purchasing Agent to purchase Notes as
principal, and the termination of any such agreement shall not require
termination of this Agreement.
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If this Agreement is terminated, Section III(c), (d) and (e),
Section VIII and Section XII hereof shall survive and shall remain in effect;
provided that if at the time of termination of this Agreement an offer to
purchase Notes has been accepted by the Company but the time of delivery to the
Purchasing Agent of such Notes has not occurred, the provisions of all of
Section III, Section IV(b) and Section V shall also survive until time of
delivery.
In the event an offering pursuant to a Terms Agreement is not
completed according to the terms of this Agreement, an Agent will be reimbursed
by the Company only for out-of-pocket accountable expenses actually incurred.
X.
Except as otherwise specifically provided herein, all
statements, requests, notices and advices hereunder shall be in writing, or by
telephone if promptly confirmed in writing, and if to the Purchasing Agent or an
Agent shall be sufficient in all respects if delivered in person or sent by
telex, facsimile transmission (confirmed in writing), or registered mail to the
Purchasing Agent or such Agent at its address, telex or telecopier number set
forth on Annex A hereto and if to the Company shall be sufficient in all
respects if delivered or sent by telex, telecopier or registered mail to the
Company at the address specified below. All such notices shall be effective on
receipt.
If to the Company:
Household Finance Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section.
XI.
This Agreement shall be binding upon the Purchasing Agent, the
Agents and the Company, and inure solely to the benefit of the Purchasing Agent,
the Agents and the Company and any other person expressly entitled to
indemnification hereunder and the respective personal representatives,
successors and assigns of each, and no other person shall acquire or have any
rights under or by virtue of this Agreement.
XII.
This Agreement shall be governed by and construed in
accordance with the substantive laws of the State of New York.
21
23
XIII.
If this Agreement is executed by or on behalf of any party,
such person hereby states that at the time of the execution of this Agreement he
has no notice of revocation of the power of attorney by which he has executed
this Agreement as such attorney.
The Company will pay the following expenses incident to the
performance of its obligations under this Agreement, including: (i) the
preparation and filing of the Registration Statement; (ii) the preparation,
issuance and delivery of the Notes; (iii) the fees and disbursements of the
Company's auditors, of the Trustee and its counsel and of any paying or other
agents appointed by the Company; (iv) the printing and delivery to the
Purchasing Agent and Agents in quantities as hereinabove stated of copies of the
Registration Statement and the Prospectus; (v) if the Company lists Notes on a
securities exchange, the costs and fees of such listing; (vi) the fees and
expenses, if any, including the reasonable fees and disbursements of ▇▇▇▇▇▇▇▇▇,
Will & ▇▇▇▇▇, incurred with respect to any filing with the National Association
of Securities Dealers, Inc.; (vii) the cost of providing CUSIP or other
identification numbers for the Notes, (viii) all reasonable expenses (including
fees and disbursements of ▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇) in connection with "Blue Sky"
qualifications and (ix) any fees charged by rating agencies for the rating of
the Notes.
This Agreement may be executed by each of the parties hereto
in any number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument. Facsimile signatures shall be deemed original
signatures.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
22
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If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, and upon acceptance hereof by you, this
letter and such acceptance hereof shall constitute a binding agreement between
the Company and you.
Very truly yours,
HOUSEHOLD FINANCE CORPORATION
By:
-------------------------------
Name:
Title:
Confirmed and accepted
as of the date first above written:
BANC OF AMERICA SECURITIES LLC
By:
------------------------------------
Name:
Title:
INCAPITAL, LLC
By:
------------------------------------
Name:
Title:
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
By:
------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ &CO., INC.
By:
------------------------------------
Name:
Title:
23
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & CO., L.P.
By:
------------------------------------
Name:
Title:
FIDELITY CAPITAL MARKETS,
a division of National Financial Services, LLC
By:
------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
By:
------------------------------------
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By:
------------------------------------
Name:
Title:
PAINEWEBBER INCORPORATED
By:
------------------------------------
Name:
Title:
24
26
ANNEX A
AGENT CONTACT INFORMATION
Banc of America Securities LLC
Bank of America Corporate Center
NC1-007-07-01
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Incapital, LLC
▇▇ ▇. ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
#1 North Jefferson
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇/▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co., Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SF345CAL-19-113
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Corporate Bond Department
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
25
27
Fidelity Capital Markets
World Trade Center
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Global Transaction Management Group
4 World Financial ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Manager - Continuously Offered Products
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
w/copy to:
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Investment Banking Information Center
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
PaineWebber Incorporated
Taxable Fixed Income Department
Attention: Corporate Desk
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
26
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EXHIBIT A
Concessions Schedule
The following Concessions are payable as a percentage of the non-discounted
Price to Public of each Note sold through the Purchasing Agent.
9 months to less than 23 months..................... 0.200%
23 months to less than 35 months.................... 0.400%
35 months to less than 47 months.................... 0.625%
47 months to less than 59 months.................... 0.750%
59 months to less than 71 months.................... 1.000%
71 months to less than 83 months.................... 1.100%
83 months to less than 95 months.................... 1.200%
95 months to less than 107 months................... 1.300%
107 months to less than 119 months.................. 1.400%
119 months to less than 131 months.................. 1.500%
131 months to less than 143 months.................. 1.600%
143 months to less than 179 months.................. 1.750%
179 months to less than 239 months.................. 2.000%
239 months to 360 months............................ 2.500%
361 months or greater............................... 3.000%
A-1
29
EXHIBIT B
Household Finance Corporation
$1,000,000,000
HFC INTERNOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
ADMINISTRATIVE PROCEDURES
HFC InterNotes, due nine months or more from date of issue are offered on a
continuing basis by Household Finance Corporation. The Notes will be offered by
Incapital, LLC (the "Purchasing Agent") and Banc of America Securities LLC, ▇.▇.
▇▇▇▇▇▇▇ & Sons, Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co., Inc., ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.,
Fidelity Capital Markets, a division of National Financial Services, LLC,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated and PaineWebber Incorporated (collectively, the "Agents") pursuant
to a Selling Agent Agreement among the Company, the Purchasing Agent and the
Agents dated as of the date hereof (the "Selling Agreement") and one or more
terms agreements substantially in the form attached to the Selling Agreement as
Exhibit C (each a "Terms Agreement"). The Notes are being sold by the Company to
the Purchasing Agent as principal for resale to (i) the Agents and (ii) to
selected broker-dealers (the "Selected Dealers") pursuant to a Master Selected
Dealers Agreement (a "Dealers Agreement") attached to the Selling Agreement as
Exhibit E, in each case for distribution to their customers. The Agents have
agreed to use their reasonable best efforts to solicit purchases of the Notes.
The Notes will constitute a part of a series of senior debt securities and have
been registered with the Securities and Exchange Commission (the "SEC"). The
Chase Manhattan Bank is the trustee (the "Trustee") for the Notes under the
Indenture dated as of March 1, 2001, as amended from time to time, between the
Company and the Trustee (the "Indenture") covering the Notes. Pursuant to the
terms of the Indenture, the Trustee also will serve as authenticating agent,
issuing agent and paying agent.
Each tranche of Notes will be issued in book-entry only form ("Notes") and
represented by one or more fully registered global notes without coupons (each,
a "Global Note") held by the Trustee, as agent for The Depository Trust
Corporation ("DTC") and recorded in the book-entry system maintained by DTC.
Each Global Note will have the annual interest rate, maturity and other terms
set forth in the relevant Pricing Supplement (as defined in the Selling
Agreement). Owners of beneficial interests in a Global Note will be entitled to
physical delivery of Notes issued in certificated form equal in principal amount
to their respective beneficial interests only upon certain limited circumstances
described in the Indenture.
Administrative procedures and specific terms of the offering are explained
below. Administrative and record-keeping responsibilities will be handled for
the Company by its Treasury Department. The Company will advise the Purchasing
Agent, the Agents and the Trustee in writing of those persons handling
administrative responsibilities with whom the Purchasing Agent, the Agents and
the Trustee are to communicate regarding offers to purchase Notes and the
details of their delivery.
B-1
30
Notes will be issued in accordance with the administrative procedures set forth
herein. To the extent the procedures set forth below conflict with or omit
certain of the provisions of the Notes, the Indenture, the Selling Agreement or
the Prospectus and the Pricing Supplement (together, the "Prospectus"), the
relevant provisions of the Notes, the Indenture, the Selling Agreement and the
Prospectus shall control. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Selling Agreement, the
Prospectus in the form most recently filed with the SEC pursuant to Rule 424 of
the 1933 Act, or in the Indenture.
Administrative Procedures for Notes
In connection with the qualification of Notes for eligibility in the book-entry
system maintained by DTC, the Trustee will perform the custodial, document
control and administrative functions described below, in accordance with its
obligations under a Letter of Representations from the Company and the Trustee
to DTC, dated _________, 2001 and a Medium-Term Note Certificate Agreement
between the Trustee and DTC (the "Certificate Agreement") dated ________, 2001
and its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS"). The procedures set forth below may be modified in
compliance with DTC's then-applicable procedures and upon agreement by the
Company, the Trustee and the Purchasing Agent.
Maturities: Each Note will mature on a date (the "Stated Maturity Date")
not less than nine months after the date of delivery by the
Company of such Note. Notes will mature on any date selected
by the initial purchaser and agreed to by the Company.
"Maturity Date" when used with respect to any Note, means the
date on which the outstanding principal amount of such Note
becomes due and payable in full in accordance with its terms,
whether at its Stated Maturity Date or by declaration of
acceleration, call for redemption, repayment or otherwise.
Issuance: All Notes having the same terms will be represented initially
by a single Global Note. Each Global Note will be dated and
issued as of the date of its authentication by the Trustee.
Each Global Note will bear an original issue date (the
"Original Issue Date"). The Original Issue Date shall remain
the same for all Notes subsequently issued upon transfer,
exchange or substitution of an original Note regardless of
their dates of authentication.
Identification The Company has received from the CUSIP Service Bureau (the
CUSIP Service Numbers: Bureau") of Standard & Poor's
Corporation
B-2
31
("Standard & Poor's") one series of CUSIP numbers consisting
of approximately 900 CUSIP numbers for future assignment to
Global Notes. The Company will provide the Purchasing Agent,
DTC and the Trustee with a list of such CUSIP numbers. On
behalf of the Company, the Purchasing Agent will assign CUSIP
numbers as described below under Settlement Procedure "B". DTC
will notify the CUSIP Service Bureau periodically of the CUSIP
numbers that the Company has assigned to Global Notes. The
Company will reserve additional CUSIP numbers when necessary
for assignment to Global Notes and will provide the Purchasing
Agent, the Trustee and DTC with the list of additional CUSIP
numbers so obtained.
Registration: Unless otherwise specified by DTC, Global Notes will be issued
only in fully registered form without coupons. Each Global
Note will be registered in the name of Cede & Co., as nominee
for DTC, on the Note Register maintained under the Indenture
by the Trustee. The beneficial owner of a Note (or one or more
indirect participants in DTC designated by such owner) will
designate one or more participants in DTC (with respect to
such Note, the "Participants") to act as agent or agents for
such owner in connection with the book-entry system maintained
by DTC, and DTC will record in book-entry form, in accordance
with instructions provided by such Participants, a credit
balance with respect to such beneficial owner of such Note in
the account of such Participants. The ownership interest of
such beneficial owner in such Note will be recorded through
the records of such Participants or through the separate
records of such Participants and one or more indirect
participants in DTC.
Transfers: Transfers of interests in a Global Note will be accomplished
by book entries made by DTC and, in turn, by Participants (and
in certain cases, one or more indirect participants in DTC)
acting on behalf of beneficial transferors and transferees of
such interests.
Exchanges: The Trustee, at the Company's request, may deliver to DTC and
the CUSIP Service Bureau at any time a written notice of
consolidation specifying (a) the CUSIP numbers of two or more
Global Notes outstanding on such date that represent Notes
having the same terms or (except that Original Issue Dates
need not be the same) and for which interest, if any, has been
paid to the same date and which otherwise constitute Notes of
the same series and tenor under the Indenture, (b) a date,
occurring at least 30 days after such written notice is
delivered and at least 30 days before the next Interest
Payment Date, if any, for the related
B-3
32
Notes, on which such Global Notes shall be exchanged for a
single replacement Global Note; and (c) a new CUSIP number,
obtained from the Company, to be assigned to such replacement
Global Note. Upon receipt of such a notice, DTC will send to
its participants (including the Issuing Agent) and the Trustee
a written reorganization notice to the effect that such
exchange will occur on such date. Prior to the specified
exchange date, the Trustee will deliver to the CUSIP Service
Bureau written notice setting forth such exchange date and the
new CUSIP number and stating that, as of such exchange date,
the CUSIP numbers of the Global Notes to be exchanged will no
longer be valid. On the specified exchange date, the Trustee
will exchange such Global Notes for a single Global Note
bearing the new CUSIP number and the CUSIP numbers of the
exchanged Global Notes will, in accordance with CUSIP Service
Bureau procedures, be cancelled and not immediately
reassigned. Notwithstanding the foregoing, if the Global Notes
to be exchanged exceed $400,000,000 in aggregate principal or
face amount, one replacement Global Note will be authenticated
and issued to represent each $400,000,000 of principal or face
amount of the exchanged Global Notes and an additional Global
Note will be authenticated and issued to represent any
remaining principal amount of such Global Notes (See
"Denominations" below).
Denominations: Unless otherwise agreed by the Company, Notes will be issued
in denominations of $1,000 or more (in multiples of $1,000).
Global Notes will be denominated in principal or face amounts
not in excess of $400,000,000 or any other limit set by the
DTC (the "Permitted Amount"). If one or more Notes having an
aggregate principal or face amount in excess of the Permitted
Amount would, but for the preceding sentence, be represented
by a single Global Note, then one Global Note will be issued
to represent each Permitted Amount principal or face amount of
such Note or Notes and an additional Global Note will be
issued to represent any remaining principal amount of such
Note or Notes. In such case, each of the Global Notes
representing such Note or Notes shall be assigned the same
CUSIP number.
Issue Price: Unless otherwise specified in an applicable Pricing
Supplement, each Note will be issued at the percentage of
principal amount specified in the Prospectus relating to such
Note.
Interest: General. Each Note will bear interest at a fixed rate.
Interest on each Note will accrue from the Original Issue Date
of such Note for the first interest period and from the most
recent Interest
B-4
33
Payment Date to which interest has been paid for all
subsequent interest periods. Except as set forth hereafter,
each payment of interest on a Note will include interest
accrued to, but excluding, as the case may be, the Interest
Payment Date or the date of Maturity. Any payment of
principal, premium or interest required to be made on a day
that is not a Business Day (as defined below) may be made on
the next succeeding Business Day and no interest shall accrue
as a result of any such delayed payment.
Each pending deposit message described under Settlement
Procedure "C" below will be routed to Standard & Poor's
Corporation, which will use the message to include certain
information regarding the related Notes in the appropriate
daily bond report published by Standard & Poor's Corporation.
Each Note will bear interest from, and including, its Original
Issue Date at the rate per annum set forth thereon and in the
applicable Pricing Supplement until the principal amount
thereof is paid, or made available for payment, in full.
Unless otherwise specified in the applicable Pricing
Supplement, interest on each Note will be payable either
monthly, quarterly, semi-annually or annually on each Interest
Payment Date and at the Maturity Date. Interest will be
payable to the person in whose name a Note is registered at
the close of business on the Regular Record Date next
preceding each Interest Payment Date; provided, however,
interest payable at the Maturity Date will be payable to the
person to whom principal shall be payable.
Any payment of principal, and premium, if any, or interest
required to be made on a Note on a day which is not a Business
Day need not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as if
made on such day, and no additional interest shall accrue as a
result of such delayed payment. Unless otherwise specified in
the applicable Pricing Supplement, any interest on the Notes
will be computed on the basis of a 360-day year of twelve
30-day months. The interest rates the Company will agree to
pay on newly-issued Notes are subject to change without notice
by the Company from time to time, but no such change will
affect any Notes already issued or as to which an offer to
purchase has been accepted by the Company.
The Interest Payment Dates for a Note that provides for
monthly interest payments shall be the fifteenth day of each
calendar month, commencing in the calendar month that next
succeeds the
B-5
34
month in which the Note is issued. In the case of a Note that
provides for quarterly interest payments, the Interest Payment
Dates shall be the fifteenth day of each third month,
commencing in the third succeeding calendar month following
the month in which the Note is issued. In the case of a Note
that provides for semi-annual interest payments, the Interest
Payment Dates shall be the fifteenth day of each sixth month,
commencing in the sixth succeeding calendar month following
the month in which the Note is issued. In the case of a Note
that provides for annual interest payments, the Interest
Payment Date shall be the fifteenth day of every twelfth
month, commencing in the twelfth succeeding calendar month
following the month in which the Note is issued. The Regular
Record Date with respect to any Interest Payment Date shall be
the first day of the calendar month in which such Interest
Payment Date occurred, except that the Regular Record Date
with respect to the final Interest Payment Date shall be the
final Interest Payment Date.
Each payment of interest on a Note shall include accrued
interest from and including the Original Issue Date or from
and including the last day in respect of which interest has
been paid (or duly provided for), as the case may be, to, but
excluding, the Interest Payment Date or Maturity Date, as the
case may be.
Calculation of
Interest: Interest on the Notes (including interest for partial periods)
will be calculated on the basis of a 360-day year of twelve
30-day months. (Examples of interest calculations are as
follows: October 1, 1998 to April 1, 1999 equals 6 months and
0 days, or 180 days; the interest paid equals 180/360 times
the annual rate of interest times the principal amount of the
Note. The period from December 3, 1998 to April 1, 1999 equals
3 months and 28 days, or 118 days; the interest payable equals
118/360 times the annual rate of interest times the principal
amount of the Note.)
Business Day: "Business Day" means, unless otherwise specified in the
applicable Pricing Supplement, any weekday that is (1) not a
legal holiday in New York, New York or Chicago, Illinois and
(2) not a day on which banking institutions in those cities
are authorized or required by law or regulation to be closed.
Payments of
Principal
and Interest: Payments of Principal and Interest. Promptly after each
Regular Record Date, the Trustee will deliver to the Company
and DTC a written notice specifying by CUSIP number the amount
of interest, if any, to be paid on each Global Note on the
following
B-6
35
Interest Payment Date (other than an Interest Payment Date
coinciding with a Maturity Date) and the total of such
amounts. DTC will confirm the amount payable on each Global
Note on such Interest Payment Date by reference to the daily
bond reports published by Standard & Poor's. On such Interest
Payment Date, the Company will pay to the Trustee, and the
Trustee in turn will pay to DTC, such total amount of interest
due (other than on the Maturity Date), at the times and in the
manner set forth below under "Manner of Payment." If any
Interest Payment Date for any Note is not a Business Day, the
payment due on such day shall be made on the next succeeding
Business Day and no interest shall accrue on such payment for
the period from and after such Interest Payment Date.
Payments on the Maturity Date. On or about the first Business
Day of each month, the Trustee will deliver to the Company and
DTC a written list of principal, premium, if any, and interest
to be paid on each Global Note representing Notes maturing or
subject to redemption or repayment in the following month. The
Trustee, the Company and DTC will confirm the amounts of such
principal, premium, if any, and interest payments with respect
to each Global Note on or about the fifth Business Day
preceding the Maturity Date of such Global Note. On the
Maturity Date, the Company will pay to the Trustee, and the
Trustee in turn will pay to DTC, the principal amount of such
Global Note, together with interest and premium, if any, due
on such Maturity Date, at the times and in the manner set
forth below under "Manner of Payment." If the Maturity Date of
any Global Note is not a Business Day, the payment due on such
day shall be made on the next succeeding Business Day and no
interest shall accrue on such payment for the period from and
after such Maturity Date. Promptly after payment to DTC of the
principal and interest due on the Maturity Date of such Global
Note and all other Notes represented by such Global Note, the
Trustee will cancel and destroy such Global Note in accordance
with the Indenture and so advise the Company.
Manner of Payment. The total amount of any principal, premium,
if any, and interest due on Global Notes on any Interest
Payment Date or at the Maturity Date shall be paid by the
Company to the Trustee in immediately available funds on such
date. The Company will make such payment on such Global Notes
to an account specified by the Trustee. Prior to 10:00 a.m.,
New York City time, on the date of Maturity or as soon as
possible thereafter, the Trustee will make payment to DTC in
accordance
B-7
36
with existing arrangements between DTC and the Trustee, in
funds available for immediate use by DTC, each payment of
interest, principal and premium, if any, due on a Global Note
on such date. On each Interest Payment Date (other than on the
Maturity Date) the Trustee will pay DTC such interest payments
in same-day funds in accordance with existing arrangements
between the Trustee and DTC. Thereafter, on each such date,
DTC will pay, in accordance with its SDFS operating procedures
then in effect, such amounts in funds available for immediate
use to the respective Participants with payments in amounts
proportionate to their respective holdings in principal amount
of beneficial interest in such Global Note as are recorded in
the book-entry system maintained by DTC. Neither the Company
nor the Trustee shall have any direct responsibility or
liability for the payment by DTC of the principal of, or
premium, if any, or interest on, the Notes to such
Participants.
Withholding Taxes. The amount of any taxes required under
applicable law to be withheld from any interest payment on a
Note will be determined and withheld by the Participant,
indirect participant in DTC or other person responsible for
forwarding payments and materials directly to the beneficial
owner of such Note.
Procedure for
Rate Setting and
Posting: The Company and the Purchasing Agent will discuss, from time
to time, the aggregate principal amounts of, the Maturities,
the Issue Price and the interest rates to be borne by Notes
that may be sold as a result of the solicitation of orders by
the Agents. If the Company decides to set interest rates borne
by any Notes in respect of which the Agents are to solicit
orders (the setting of such interest rates to be referred to
herein as "Posting") or if the Company decides to change
interest rates previously posted by it, it will promptly
advise the Purchasing Agent of the prices and interest rates
to be posted.
The Purchasing Agent will assign a separate CUSIP number for
each tranche of Notes to be posted, and will so advise and
notify the Company and the Trustee of said assignment by
telephone and/or by telecopier or other form of electronic
transmission. The Purchasing Agent will include the assigned
CUSIP number on all Posting notices communicated to the Agents
and Selected Dealers.
B-8
37
Offering of
Notes: In the event that there is a Posting, the Purchasing Agent
will communicate to each of the Agents and Selected Dealers
the aggregate principal amount and maturities of, along with
the interest rates to be borne by, each tranche of Notes that
is the subject of the Posting. Thereafter, the Agents and the
Selected Dealers will solicit offers to purchase the Notes
accordingly.
Purchase of
Notes by the
Purchasing
Agent: The Purchasing Agent will, as soon as practicable after 12:00
noon (New York City time) on the seventh day subsequent to the
day on which such Posting occurs, or if such seventh day is
not a Business Day on the succeeding Business Day, or on such
other Business Day and time as shall be mutually agreed upon
by the Company and the Purchasing Agent (any such day, a
"Trade Day"), (i) complete, execute and deliver to the Company
a Terms Agreement that sets forth, among other things, the
amount of each tranche that the Purchasing Agent is offering
to purchase or (ii) inform the Company that none of the Notes
of a particular tranche will be purchased by the Purchasing
Agent.
Acceptance and
Rejection of
Orders: Unless otherwise agreed by the Company and the Purchasing
Agent, the Company has the sole right to accept orders to
purchase Notes and may reject any such order in whole or in
part. Unless otherwise instructed by the Company, the
Purchasing Agent will promptly advise the Company by telephone
of all offers to purchase Notes received by it, other than
those rejected by it in whole or in part in the reasonable
exercise of its discretion. No order for less than $1,000
principal amount of Notes will be accepted.
Upon receipt of a completed and executed Terms Agreement from
the Purchasing Agent, the Company will (i) promptly execute
and return such Terms Agreement to the Purchasing Agent or
(ii) inform the Purchasing Agent that its offer to purchase
the Notes of a particular tranche has been rejected, in whole
or in part. The Purchasing Agent will thereafter promptly
inform the Agents and participating Selected Dealers of the
action taken by the Company.
Preparation of
Pricing
Supplement: If any offer to purchase a Note is accepted by or on behalf of
the Company, the Company will provide a Pricing Supplement to
the Purchasing Agent and Trustee (substantially in the form
attached to the Selling Agreement as Exhibit D) reflecting the
terms of such Note and will file such Pricing Supplement with
the SEC in accordance with the applicable paragraph of Rule
424(b) under
B-9
38
the Act. The Company shall use its reasonable best efforts to
send such Pricing Supplement by email or telecopy to the
Purchasing Agent and the Trustee by 3:00 p.m. (New York City
Time) on the applicable Trade Day. The Purchasing Agent shall
use its reasonable best efforts to send such Pricing
Supplement and the Prospectus by email or telecopy or
overnight express (for delivery by the close of business on
the applicable Trade Day, but in no event later than 11:00
a.m. New York City time, on the Business Day following the
applicable Trade Date) to each Agent and each Selected Dealer
which made or presented the offer to purchase the applicable
Note and the Trustee at the following applicable address:
if to Banc of America Securities LLC, to:
----------------------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 28255-0065
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇.▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
if to Incapital, LLC, to:
------------------------
▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
if to the Agents:
----------------
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
#1 North Jefferson
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇/▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
▇-▇▇
▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co., Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SF345CAL-19-113
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co., L.P.
Corporate Bond Department
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email:
Fidelity Capital Markets
World Trade Center
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
email: ▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Global Transaction Management Group
4 World Financial ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇▇_▇▇▇▇▇▇▇▇@▇▇.▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Manager - Continuously Offered Products
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
w/copy to:
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Investment Banking Information Center
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email:
B-11
40
PaineWebber Incorporated
Taxable Fixed Income Department
Attention: Corporate Desk
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
email:
For record keeping purposes, one copy of
each Pricing Supplement, as so filed,
shall also be mailed or telecopied to:
▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier (▇▇▇) ▇▇▇-▇▇▇▇
and to:
------
Banc of America Securities LLC
Bank of America Corporate Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 28255-0065
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
email: ▇▇▇▇.▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Each such Agent or Selected Dealer, in
turn, pursuant to the terms of the
Selling Agreement and the Master
Selected Dealer Agreement, will cause to
be delivered a copy of the Prospectus
and the applicable Pricing Supplement to
each purchaser of Notes from such Agent
or Selected Dealer.
Outdated Pricing Supplements and the
Prospectuses to which they are attached
(other than those retained for files)
will be destroyed.
B-12
41
Delivery of Confirmation
and Prospectus to Purchaser
by Presenting Agent: Subject to "Suspension of Solicitation;
Amendment or Supplement" below, the Agents
will deliver a Prospectus and Pricing
Supplement as herein described with respect
to each Note sold by it.
For each offer to purchase a Note accepted by
or on behalf of the Company, the Purchasing
Agent will confirm in writing with each Agent
and Selected Dealer the terms of such Note,
the amount being purchased by such Agent or
Selected Dealer and other applicable details
described above and delivery and payment
instructions, with a copy to the Company.
In addition, each Agent or Selected Dealer,
as the case may be, will deliver to investors
purchasing the Notes the Prospectus
(including the Pricing Supplement) in
relation to such Notes prior to or
simultaneously with delivery of the
confirmation of sale or delivery of the Note.
Settlement: The receipt of immediately available funds by
the Company in payment for Notes and the
authentication and issuance of the Global
Note representing such Notes shall constitute
"Settlement" with respect to such Note. All
orders accepted by the Company will be
settled within one to three Business Days
pursuant to the timetable for Settlement set
forth below, unless the Company and the
purchaser agree to Settlement on a later
date, and shall be specified upon acceptance
of such offer; provided, however, in all
cases the Company will notify the Trustee on
the date issuance instructions are given.
Settlement Procedures: In connection with a purchase of Notes by the
Purchasing Agent, appropriate Settlement
details will be set forth in the applicable
Terms Agreement to be entered into between
the Purchasing Agent and the Company pursuant
to the Selling Agreement. Settlement
Procedures with regard to each Note sold to
the Purchasing Agent by the Company, shall be
as follows:
A. After the oral acceptance of an offer by
the Company with respect to a Note, the
Purchasing Agent will prepare and
deliver to the Company for execution the
Terms Agreement containing the following
details of the terms of the Notes to be
purchased by the Purchasing Agent:
1. Principal amount of the purchase;
▇-▇▇
▇▇
▇. Interest Rate per annum;
3. Interest Payment Frequency;
4. Settlement Date;
5. Stated Maturity Date;
6. Price to Public;
7. Purchasing Agent's commission
determined pursuant to Section IV(a)
of the Selling Agreement;
8. Net proceeds to the Company;
9. Trade Date;
10. If a Note is redeemable by the
Company or repayable by the
Noteholder, such of the following as
are applicable:
(i) The date on and after which
such Note may be
redeemed/repaid (the
"Redemption/Repayment
Commencement Date"),
(ii) Initial redemption/repayment
price (% of par), and
(iii) Amount (% of par) that the
initial redemption/repayment
price shall decline (but not
below par) on each anniversary
of the Redemption/Repayment
Commencement Date;
11. Whether the Note has a Survivor's
Option;
12. If a Discount Note, the total amount
of original issue discount, the
yield to maturity and the initial
accrual period of original issue
discount;
13. The CUSIP Number; and
▇-▇▇
▇▇
▇▇. Such other terms as are necessary to
complete the applicable form of
Note.
B. The Company will confirm the acceptance
of the offer to purchase Notes by
executing the Terms Agreement and
forwarding it to the Company by
telecopier or other form of electronic
transmission. Each such acceptance by
the Company will be deemed to constitute
a representation and warranty by the
Company to the Trustee, the Purchasing
Agent and the Agents that (i) such Note
is then, and at the time of issuance and
sale thereof will be, duly authorized
for issuance and sale by the Company;
(ii) such Note, and the Global Note
representing such Note, will conform
with the terms of the Indenture; and
(iii) upon authentication and delivery
of the Global Note representing such
Note, the aggregate principal amount of
all Notes issued under the Indenture
will not exceed the aggregate principal
amount of Notes authorized for issuance
at such time by the Company.
C. The Trustee will communicate to DTC and
the Purchasing Agent through DTC's
Participant Terminal System, a pending
deposit message specifying the following
Settlement information:
1. The information received in
accordance with Settlement Procedure
"A".
2. The numbers of the participant
accounts maintained by DTC on behalf
of the Trustee and the Purchasing
Agent.
3. The initial Interest Payment Date
for such Note, number of days by
which such date succeeds the related
DTC record date (which term means
the Regular Record Date), and if
then calculated, the amount of
interest payable on such Initial
Interest Payment Date (which amount
shall have been confirmed by the
Trustee).
4. The CUSIP number of the Global Note
representing such Notes.
5. The frequency of interest.
▇-▇▇
▇▇
▇. Whether such Global Note represents
any other Notes issued or to be
issued (to the extent then known).
D. DTC will credit such Note to the
participant account of the Trustee
maintained by DTC.
E. The Trustee will complete and deliver a
Global Note representing such Note in a
form that has been approved by the
Company, the Purchasing Agent, the
Agents and the Trustee.
F. The Trustee will authenticate the Global
Note representing such Note and maintain
possession of such Global Note.
G. The Trustee will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC to (i) debit such
Note to the Trustee's participant
account and credit such Note to the
participant account of the Purchasing
Agent maintained by DTC and (ii) debit
the settlement account of the Purchasing
Agent and credit the settlement account
of the Trustee maintained by DTC, in an
amount equal to the price of such Note
less the Purchasing Agent's commission.
The entry of such a deliver order shall
be deemed to constitute a representation
and warranty by the Trustee to DTC that
(a) the Global Note representing such
Note has been issued and authenticated
and (b) the Trustee is holding such
Global Note pursuant to the Certificate
Agreement.
H. The Purchasing Agent will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC to (i)
debit such Note to the Purchasing
Agent's participant account and credit
such Note to the participant accounts of
the Participants to whom such Note is to
be credited maintained by DTC and (ii)
debit the settlement accounts of such
Participants and credit the settlement
account of the Purchasing Agent
maintained by DTC, in an amount equal to
the price of the Note less the agreed
upon commission so credited to their
accounts.
B-16
45
I. Transfers of funds in accordance with
SDFS deliver orders described in
Settlement Procedures "G" and "H" will
be settled in accordance with SDFS
operating procedures in effect on the
Settlement Date.
J. The Trustee will credit to an account of
the Company specified from time to time
by the Company funds available for
immediate use in an amount equal to the
amount credited to the Trustee's DTC
participant account in accordance with
Settlement Procedure "G".
K. The Trustee will send a copy of the
Global Note representing such Note by
first-class mail to the Company.
L. Each Agent and Selected Dealer will
confirm the purchase of each Note to the
purchaser thereof either by transmitting
to the Participant to whose account such
Note has been credited a confirmation
order through DTC's Participant Terminal
System or by mailing a written
confirmation to such purchaser. In all
cases the Prospectus as most recently
amended or supplemented must accompany
or precede such confirmation.
M. At the request of the Company, the
Trustee will send to the Company a
statement setting forth the principal
amount of Notes outstanding as of that
date under the Indenture and setting
forth the CUSIP number(s) assigned to,
and a brief description of, any orders
which the Company has advised the
Trustee but which have not yet been
settled.
Settlement Procedures Timetable: Settlement Procedures "A" through "M" shall
be completed as soon as possible but not
later than the respective times (New York
City time) set forth below:
Settlement
Procedure Time
--------- ----
A 2:00 p.m. on the Trade Day.
B 5:00 p.m. on the Trade Day.
C 2:00 p.m. on the Business Day
before the Settlement Date.
D 10:00 a.m. on the Settlement
Date.
E 12:00 p.m. on the Settlement
Date.
F 12:30 a.m. on the Settlement
Date.
B-17
46
G-H 2:00 p.m. on the Settlement
Date.
I 4:45 p.m. on the Settlement
Date.
▇-▇ 5:00 p.m. on the Settlement
Date.
M At the request of the Company.
NOTE: The Prospectus as most recently
amended or supplemented must accompany
or precede any written confirmation
given to the customer (Settlement
Procedure "L"). Settlement Procedure "I"
is subject to extension in accordance
with any extension Fedwire closing
deadlines and in the other events
specified in the SDFS operating
procedures in effect on the Settlement
Date.
If Settlement of a Note is rescheduled
or cancelled, the Trustee will deliver
to DTC, through DTC's Participant
Terminal System, a cancellation message
to such effect by no later than 2:00
p.m., New York City time, on the
Business Day immediately preceding the
scheduled Settlement Date.
B-18
47
Failure to Settle: If the Trustee fails to enter an SDFS deliver
order with respect to a Note pursuant to
Settlement Procedure "G", the Trustee may
deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit
such Note to the participant account of the
Trustee maintained at DTC. DTC will process
the withdrawal message, provided that such
participant account contains Notes having the
same terms and having a principal amount that
is at least equal to the principal amount of
such Note to be debited. If withdrawal
messages are processed with respect to all
the Notes issued or to be issued represented
by a Global Note, the Trustee will cancel
such Global Note in accordance with the
Indenture, make appropriate entries in its
records and so advise the Company. The CUSIP
number assigned to such Global Note shall, in
accordance with CUSIP Service Bureau
procedures, be cancelled and not immediately
reassigned. If withdrawal messages are
processed with respect to one or more, but
not all, of the Notes represented by a Global
Note, the Trustee will exchange such Global
Note for two Global Notes, one of which shall
represent such Notes and shall be cancelled
immediately after issuance, and the other of
which shall represent the remaining Notes
previously represented by the surrendered
Global Note and shall bear the CUSIP number
of the surrendered Global Note. If the
purchase price for any Note is not timely
paid to the Participants with respect to such
Note by the beneficial purchaser thereof (or
a person, including an indirect participant
in DTC, acting on behalf of such purchaser),
such Participants and, in turn, the
Purchasing Agent may enter SDFS deliver
orders through DTC's participant Terminal
System reversing the orders entered pursuant
to Settlement Procedures "G" and "H",
respectively. Thereafter, the Trustee will
deliver the withdrawal message and take the
related actions described in the preceding
paragraph. If such failure shall have
occurred for any reason other than default by
the Purchasing Agent or any Agent in the
performance of its obligations hereunder or
under the Selling Agreement, the Company will
reimburse the Purchasing Agent or any Agent
on an equitable basis for its reasonable
out-of-pocket accountable expenses actually
incurred and loss of the use of funds during
the period when they were credited to the
account of the Company.
B-19
48
Notwithstanding the foregoing, upon any
failure to settle with respect to a Note, DTC
may take any actions in accordance with its
SDFS operating procedures then in effect. In
the event of a failure to settle with respect
to one or more, but not all, of Notes that
were to have been represented by a Global
Note, the Trustee will provide, in accordance
with Settlement Procedures "D" and "E", for
the authentication and issuance of a Global
Note representing the other Notes to have
been represented by such Global Note and will
make appropriate entries in its records.
Suspension of Solicitation
Amendment or Supplement: Subject to the Company's representations,
warranties and covenants contained in the
Selling Agreement, the Company may instruct
the Purchasing Agent to instruct the Agents
to suspend at any time for any period of time
or permanently, the solicitation of orders to
purchase Notes. Upon receipt of such
instructions (which may be given orally),
each Agent will forthwith suspend
solicitation until such time as the Company
has advised it that solicitation of purchases
may be resumed.
In the event that at the time the Company
suspends solicitation of purchases there
shall be any orders outstanding for
settlement, the Company will promptly advise
the Purchasing Agent, the Agents and the
Trustee whether such orders may be settled
and whether copies of the Prospectus as in
effect at the time of the suspension may be
delivered in connection with the settlement
of such orders. The Company will have the
sole responsibility for such decision and for
any arrangements which may be made in the
event that the Company determines that such
orders may not be settled or that copies of
such Prospectus may not be so delivered.
If the Company decides to amend or supplement
the Registration Statement or the Prospectus,
it will promptly advise the Purchasing Agent
and the Agents and furnish the Purchasing
Agent and the Trustee with the proposed
amendment or supplement and with such
certificates and opinions as are required,
all to the extent required by and in
accordance with the terms of the Selling
Agreement. Subject to the provisions of the
Selling Agreement, the Company may file with
the Commission any supplement to the
Prospectus relating to the Notes. The Company
will provide the Purchasing Agent and the
Trustee with copies of any such supplement,
and confirm to the Purchasing Agent that such
supplement has been filed with the SEC.
B-20
49
Trustee Not to Risk Funds: Nothing herein shall be deemed to require the
Trustee to risk or expend its own funds in
connection with any payment to the Company,
or the Purchasing Agent, the Agents or the
purchasers, it being understood by all
parties that payments made by the Trustee to
either the Company, the Purchasing Agent or
the Agents shall be made only to the extent
that funds are provided to the Trustee for
such purpose.
Advertising Costs: The Company shall have the sole right to
approve the form and substance of any
advertising the Purchasing Agent or an Agent
may initiate in connection with the
solicitation of offers to purchase the Notes.
The expense of such advertising will be
solely the responsibility of the Purchasing
Agent or such Agent, unless otherwise agreed
to by the Company.
B-21
50
EXHIBIT C
TERMS AGREEMENT
, 2001
Household Finance Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
The undersigned agrees to purchase the following HFC InterNotes:
The terms of such Notes shall be as follows:
CUSIP Number: __________
Principal Amount:
----------
Interest Rate: _____%
Original Issue Date:
----------------
Maturity Date: __________
Price to Public: __________%
Commission: ___%
Proceeds to Issuer: _________
Settlement Date, Time and Place: __________
Survivor's Option: __________
Interest Payment Frequency: __________
Optional Redemption/Repayment provisions, if any: __________
[Any other terms and conditions agreed
to by the Purchasing Agent and the Company]
INCAPITAL, LLC
By:
---------------------------------
Title:
------------------------------
ACCEPTED
HOUSEHOLD FINANCE CORPORATION
By:
-----------------------------------------
Title:
--------------------------------------
▇-▇
▇▇
▇▇▇▇▇▇▇ ▇
Form of Pricing Supplement
Pricing Supplement Dated: Rule 424(b)(3)
-----------------------
(To Prospectus Dated , 2001) File No. 333-______
---------------
Pricing Supplement No.
---------------------
U.S. $1,000,000,000
HOUSEHOLD FINANCE CORPORATION
HFC INTERNOTES(SM)
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
----------------------------------------------------------
Trade Date:
------------------------
Issue Date:
-----------------------
Agent:
-----------------------------
-----------------------------------------------------------------
---------- ---------------- -------------- ---------------- ---------------- ------------------ ----------------
CUSIP AGGREGATE PRICE CONCESSION NET INTEREST INTEREST
PRINCIPAL TO PROCEEDS RATE PAYMENT
AMOUNT PUBLIC TO ISSUER FREQUENCY
---------- ---------------- -------------- ---------------- ---------------- ------------------ ----------------
---------- ---------------- -------------- ---------------- ---------------- ------------------ ----------------
---------------------- ------------------- -------------------- ------------------------ ------------------------
MATURITY SURVIVOR'S OPTION REDEMPTION REPAYMENT REDEMPTION/ REPAYMENT
DATE YES/NO YES/NO TERMS
---------------------- ------------------- -------------------- ------------------------ ------------------------
---------------------- ------------------- -------------------- ------------------------ ------------------------
Other Terms:
--------------------------------------------------------------------
--------------------------------------------------------------------------------
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52
EXHIBIT E
Master Selected Dealer Agreement
((FirstName))
((Company))
((Address1))
((Address2))
((City)), ((State)) ((Postal))
Dear Selected Dealer:
In connection with public offerings of securities after the date hereof
for which we are acting as manager of an underwriting syndicate or are otherwise
responsible for the distribution of securities to the public by means of an
offering of securities for sale to selected dealers, you may be offered the
right as such a selected dealer to purchase as principal a portion of such
securities. This will confirm our mutual agreement as to the general terms and
conditions applicable to your participation in any such selected dealer group
organized by us as follows.
1. Applicability of this Agreement. The terms and conditions of this
Agreement shall be applicable to any public offering of securities
("Securities"), pursuant to a registration statement filed under the Securities
Act of 1933 (the "Securities Act"), or exempt from registration thereunder
(other than a public offering of Securities effected wholly outside the United
States of America), wherein Incapital, LLC clearing through BNY Clearing
Services, LLC (the "Account") (acting for its own Account or for the account of
any underwriting or similar group or syndicate) is responsible for managing or
otherwise implementing the sale of the Securities to selected dealers ("Selected
Dealers") and has expressly informed you that such terms and conditions shall be
applicable. Any such offering of Securities to you as a Selected Dealer is
hereinafter called an "Offering". In the case of any Offering where we are
acting for the account of any underwriting or similar group or syndicate
("Underwriters"), the terms and conditions of this Agreement shall be for the
benefit of, and binding upon, such Underwriters, including, in the case of any
Offering where we are acting with others as representatives of Underwriters,
such other representatives.
2. Conditions of Offering; Acceptance and Purchases. Any Offering: (i)
will be subject to delivery of the Securities and their acceptance by us and any
other Underwriters; (ii) may be subject to the approval of all legal matters by
counsel and the satisfaction of other conditions, and (iii) may be made on the
basis of reservation of Securities or an allotment against subscription. We will
advise you by electronic mail, facsimile or other form of written communication
("Written Communication", which term, in the case of any Offering described in
Section 3(a) or 3(b) hereof, may include a prospectus or offering circular) of
the particular
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method and supplementary terms and conditions (including, without limitation,
the information as to prices and offering date referred to in Section 3(c)
hereof) of any Offering in which you are invited to participate. To the extent
such supplementary terms and conditions are inconsistent with any provision
herein, such terms and conditions shall supersede any such provision. Unless
otherwise indicated in any such Written Communication, acceptances and other
communications by you with respect to an Offering should be sent to Incapital,
LLC, ▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (Fax: (312)
▇▇▇-▇▇▇▇). We reserve the right to reject any acceptance in whole or in part.
Unless notified otherwise by us, Securities purchased by you shall be paid for
on such date as we shall determine, on one day's prior notice to you, by
certified or official bank check, in an amount equal to the Public Offering
Prices (as hereinafter defined) or, if we shall so advise you, at such Public
Offering Price less the Concession (as hereinafter defined), payable in New York
Clearing House funds to the order of BNY Clearing Services, LLC clearing for the
account of Incapital, LLC, against delivery of the Securities. If Securities are
purchased and paid for at such Public Offering Price, such Concession will be
paid after the termination of the provisions of Section 3(c) hereof with respect
to such Securities. Notwithstanding the foregoing, unless notified otherwise by
us, payment for and delivery of Securities purchased by you shall be made
through the facilities of The Depository Trust Company, if you are a member,
unless you have otherwise notified us prior to the date specified in a Written
Communication to you from us or, if you are not a member, settlement may be made
through a correspondent who is a member pursuant to instructions which you will
send to us prior to such specified date.
3. Representations, Warranties and Agreements.
(a) Registered Offerings. In the case of any Offering of Securities
that are registered under the Securities Act ("Registered Offering"), we shall
provide you with such number of copies of each preliminary prospectus and of the
final prospectus relating thereto as you may reasonably request for the purposes
contemplated by the Securities Act and the Securities Exchange Act of 1934 (the
"Exchange Act") and the applicable rules and regulations of the Securities and
Exchange Commission thereunder. You represent and warrant that you are familiar
with Rule 15c2-8 under the Exchange Act relating to the distribution of
preliminary and final prospectuses and agree that you will comply therewith. You
agree to make a record of your distribution of each preliminary prospectus and,
when furnished with copies of any revised preliminary prospectus, you will, upon
our request, promptly forward copies thereof to each person to whom you have
theretofore distributed a preliminary prospectus. You agree that in purchasing
Securities in a Registered Offering you will rely upon no statement whatsoever,
written or oral, other than the statements in the final prospectus delivered to
you by us. You will not be authorized by the issuer or other seller of
Securities offered pursuant to a prospectus or by any Underwriter to give any
information or to make any representation not contained in the prospectus in
connection with the sale of such Securities.
(b) Offerings Pursuant to Offering Circular. In the case of any
Offering of Securities, other than a Registered Offering, which is made pursuant
to an offering circular or other document comparable to a prospectus in a
Registered Offering, we shall provide you with such number of copies of each
preliminary offering circular and of the final offering circular relating
thereto as you may reasonably request. You agree that you will comply with the
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applicable Federal and state laws, and the applicable rules and regulations of
any regulatory body promulgated thereunder, governing the use and distribution
of offering circulars by brokers or dealers. You agree that in purchasing
Securities pursuant to an offering circular you will rely upon no statements
whatsoever, written or oral, other than the statements in the final offering
circular delivered to you by us. You will not be authorized by the issuer or
other seller of Securities offered pursuant to an offering circular or by any
Underwriter to give any information or to make any representation not contained
in the offering circular in connection with the sale of such Securities.
(c) Offer and Sale to the Public. With respect to any Offering of
Securities, we will inform you by a Written Communication of the public offering
price, the selling concession, the reallowance (if any) to dealers and the time
when you may commence selling Securities to the public. After such public
offering has commenced, we may change the public offering price, the selling
concession and the reallowance to dealers. The offering price, selling
concession and reallowance (if any) to dealers at any time in effect with
respect to an Offering are hereinafter referred to, respectively, as the "Public
Offering Price", the "Concession" and the "Reallowance". With respect to each
Offering of Securities, until the provisions of this Section 3(c) shall be
terminated pursuant to Section 4 hereof, you agree to offer Securities to the
public at no more than the Public Offering Price. If so notified by us, you may
sell Securities to the public at a lesser negotiated price than the Public
Offering Price, but in an amount not to exceed the "Concession." If a
Reallowance is in effect, a reallowance from the Public Offering Price not in
excess of such Reallowance may be allowed as consideration for services rendered
in distribution to dealers who are actually engaged in the investment banking or
securities business, who execute the written agreement prescribed by section
24(c) of Article III of the Rules of Fair Practice of the National Association
of Securities Dealers, Inc. (the "NASD") and who are either members in good
standing of the NASD or foreign banks, dealers or institutions not eligible for
membership in the NASD who represent to you that they will promptly reoffer such
Securities at the Public Offering Price and will abide by the conditions with
respect to foreign banks, dealers and institutions set forth in Section 3(e)
hereof.
(d) Over-allotment; Stabilization; Unsold Allotments. We may, with
respect to any Offering, be authorized to over-allot in arranging sales to
Selected Dealers, to purchase and sell Securities for long or short account and
to stabilize or maintain the market price of the Securities. You agree that,
upon our request at any time and from time to time prior to the termination of
the provisions of Section 3(c) hereof with respect to any Offering, you will
report to us the amount of Securities purchased by you pursuant to such Offering
which then remain unsold by you and will, upon our request at any such time,
sell to us for our account or the account of one or more Underwriters such
amount of such unsold Securities as we may designate at the Public Offering
Price less an amount to be determined by us not in excess of the Concession. If,
prior to the later of (i) the termination of the provisions of Section 3(c)
hereof with respect to any Offering or (ii) the covering by us of any short
position created by us in connection with such Offering for our account or the
account of one or more Underwriters, we purchase or contract to purchase for our
account or the account of one or more Underwriters in the open market or
otherwise any Securities purchased by you under this Agreement as part of such
Offering, you agree to pay us on demand an amount equal to the Concession with
respect to
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such Securities (unless you shall have purchased such Securities pursuant to
Section 2 hereof at the Public Offering Price in which case we shall not be
obligated to pay such Concession to you pursuant to Section 2) plus transfer
taxes and broker's commissions or dealer's ▇▇▇▇-up, if any, paid in connection
with such purchase or contract to purchase.
(e) NASD. You represent and warrant that you are actually engaged in
the investment banking or securities business and either a member in good
standing of the NASD or, if you are not such a member, you are a foreign bank,
dealer or institution not eligible for membership in the NASD which agrees to
make no sales within the United States, its territories or its possessions or to
persons who are citizens thereof or residents therein, and in making other sales
to comply with the NASD's interpretation with respect to free riding and
withholding. You further represent, by your participation in an Offering, that
you have provided to us all documents and other information required to be filed
with respect to you, any related person or any person associated with you or any
such related person pursuant to the supplementary requirements of the NASD's
interpretation with respect to review of corporate financing as such
requirements relate to such Offering.
You agree that, in connection with any purchase or sale of the
Securities wherein a Concession, discount or other allowance is received or
granted, (1) you will comply with the provisions of section 24 of Article III of
the NASD's Rules of Fair Practice and (2) if you are a non-NASD member broker or
dealer in a foreign country, you will also comply (a), as though you were an
NASD member, with the provisions of sections 8 and 36 thereof and (b) with
section 25 thereof as that section applies to a non-NASD member broker or dealer
in a foreign country.
You further agree that, in connection with any purchase of securities
from us that is not otherwise covered by the terms of this Agreement (whether we
are acting as manager, as a member of an underwriting syndicate or a selling
group or otherwise), if a selling Concession, discount or other allowance is
granted to you, clauses (1) and (2) of the preceding paragraph will be
applicable.
(f) Relationship among Underwriters and Selected Dealers. We may buy
Securities from or sell Securities to any Underwriter or Selected Dealer and,
without consent, the Underwriters (if any) and the Selected Dealers may purchase
Securities from and sell Securities to each other at the Public Offering Price
less all or any part of the Concession. Unless otherwise specified in a separate
agreement between you and us, this agreement does not authorize you to act as
agent for: (i) us; (ii) any Underwriter; (iii) the issuer; or (iv) other seller
of any Securities in offering Securities to the public or otherwise. Neither we
nor any Underwriter shall be under any obligation to you except for obligations
assumed hereby or in any Written Communication from us in connection with any
Offering. Nothing contained herein or in any Written Communication from us shall
constitute the Selected Dealers an association or partners with us or any
Underwriter or with one another. If the Selected Dealers, among themselves or
with the Underwriters, should be deemed to constitute a partnership for Federal
income tax purposes, then you elect to be excluded from the application of
Subchapter K, Chapter 1, Subtitle A of the Internal Revenue Code of 1986 and
agree not to take any position inconsistent with that election. You authorize
us, in our discretion, to execute and file on your behalf such evidence of that
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election as may be required by the Internal Revenue Service. In connection with
any Offering, you shall be liable for your proportionate amount of any tax,
claim, demand or liability that may be asserted against you alone or against one
or more Selected Dealers participating in such Offering, or against us or the
Underwriters, based upon the claim that the Selected Dealers, or any of them,
constitute an association, an unincorporated business or other entity,
including, in each case, your proportionate amount of any expense incurred in
defending against any such tax, claim, demand or liability.
(g) Blue Sky Laws. Upon application to us, we shall inform you as to
any advice we have received from counsel concerning the jurisdictions in which
Securities have been qualified for sale or are exempt under the securities or
blue sky laws of such jurisdictions, but we do not assume any obligation or
responsibility as to your right to sell Securities in any such jurisdiction.
(h) Compliance with Law. You agree that in selling Securities pursuant
to any Offering (which agreement shall also be for the benefit of the issuer or
other seller of such Securities) you will comply with all applicable laws, rules
and regulations, including the applicable provisions of the Securities Act and
the Exchange Act, the applicable rules and regulations of the Securities and
Exchange Commission thereunder, the applicable rules and regulations of the
NASD, the applicable rules and regulations of any securities exchange having
jurisdiction over the Offering and the applicable laws, rules and regulations
specified in Section 3(b) hereof.
Furthermore, you acknowledge and agree that certain Offerings of
Securities (i) may be made in the United States only and/or (ii) may be
offerings of Securities of an affiliate of a United States bank but are not
savings accounts, deposits or other obligations of any such bank and would not
be guaranteed by such bank or insured by the Federal Deposit Insurance
Corporation or any other governmental agency.
4. Termination, Supplements and Amendments. This Agreement shall
continue in full force and effect until terminated by a written instrument
executed by each of the parties hereto. This Agreement may be supplemented or
amended by us by written notice thereof to you, and any such supplement or
amendment to this Agreement shall be effective with respect to any Offering to
which this Agreement applies after the date of such supplement or amendment.
Each reference to "this Agreement" herein shall, as appropriate, be to this
Agreement as so amended and supplemented. The terms and conditions set forth in
Section 3(c) hereof with regard to any Offering will terminate at the close of
business on the 30th day after the commencement of the public offering of the
Securities to which such Offering relates, but in our discretion may be extended
by us for a further period not exceeding 30 days and in our discretion, whether
or not extended, may be terminated at any earlier time.
5. Successors and Assigns. This Agreement shall be binding on, and
inure to the benefit of, the parties hereto and other persons specified in
Section 1 hereof, and the respective successors and assigns of each of them.
▇-▇
▇▇
▇. Governing Law. This Agreement and the terms and conditions set forth
herein with respect to any Offering together with such supplementary terms and
conditions with respect to such Offering as may be contained in any Written
Communication from us to you in connection therewith shall be governed by, and
construed in accordance with, the laws of the State of Illinois.
Please confirm by signing and returning to us the enclosed copy of this
Agreement that your subscription to, or your acceptance of any reservation of,
any Securities pursuant to an Offering shall constitute (i) acceptance of and
agreement to the terms and conditions of this Agreement (as supplemented and
amended pursuant to Section 4 hereof) together with and subject to any
supplementary terms and conditions contained in any Written Communication from
us in connection with such Offering, all of which shall constitute a binding
agreement between you and us, individually or as representative of any
Underwriters, (ii) confirmation that your representations and warranties set
forth in Section 3 hereof are true and correct at that time, (iii) confirmation
that your agreements set forth in Sections 2 and 3 hereof have been and will be
fully performed by you to the extent and at the times required thereby and (iv)
in the case of any Offering described in Section 3(a) and 3(b) hereof,
acknowledgment that you will request and have received from us sufficient copies
of the final prospectus or offering circular, as the case may be, with respect
to such Offering in order to comply with your undertakings in Section 3(a) or
3(b) hereof.
Very truly yours,
INCAPITAL, LLC
By:
---------------------------------
--------------------------------------------------------------------------------
CONFIRMED: ______________________, 20___
((Company))
By:
---------------------------------
Name:
-------------------------------
(Print name)
Title:
------------------------------
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