<PAGE>   1

                                                                    Exhibit 4.4




                  =========================================


                            AMENDED AND RESTATED
                                 DECLARATION
                                  OF TRUST

                           HOUSEHOLD CAPITAL TRUST V
                         Dated as of March ___, 2000


                  =========================================




<PAGE>   2




                           CROSS-REFERENCE TABLE*


<TABLE>
<CAPTION>

Section of
Trust Indenture Act                                       Section of
of 1939, as amended                                       Declaration
-------------------
<S>                                                       <C>
310(a) . . . . . . . . . . . . . . . . . . . . . . .          5.3(a)
310(b) . . . . . . . . . . . . . . . . . . . . . . .          5.3(c)
310(c) . . . . . . . . . . . . . . . . . . . . . . .          Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . .          2.2(b)
311(b) . . . . . . . . . . . . . . . . . . . . . . .          2.2(b)
311(c) . . . . . . . . . . . . . . . . . . . . . . .          Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . .          2.2(a)
312(b) . . . . . . . . . . . . . . . . . . . . . . .          2.2(b)
313  . . . . . . . . . . . . . . . . . . . . . . . .          2.3
314(a) . . . . . . . . . . . . . . . . . . . . . . .          2.4
314(b) . . . . . . . . . . . . . . . . . . . . . . .      Inapplicable
314(c) . . . . . . . . . . . . . . . . . . . . . . .          2.5
314(d) . . . . . . . . . . . . . . . . . . . . . . .      Inapplicable
314(f) . . . . . . . . . . . . . . . . . . . . . . .          Inapplicable
315(a) . . . . . . . . . . . . . . . . . . . . . . .          3.9(b)
315(b) . . . . . . . . . . . . . . . . . . . . . . .          2.8
315(c) . . . . . . . . . . . . . . . . . . . . . . .          3.9(a)
315(d) . . . . . . . . . . . . . . . . . . . . . . .          3.9(a)
316(a) . . . . . . . . . . . . . . . . . . . . . . .      Exhibit At 2.6
316(c) . . . . . . . . . . . . . . . . . . . . . . .          3.6(e)

</TABLE>

* This Cross-Reference Table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.


<PAGE>   3




                              TABLE OF CONTENTS
<TABLE>
<S>                                                                         <C>
DECLARATION OF TRUST .....................................................   1

                                  ARTICLE I
                       INTERPRETATION AND DEFINITIONS

    SECTION 1.1  Definitions .............................................   1

                                 ARTICLE II
                             TRUST INDENTURE ACT

    SECTION 2.1  Trust Indenture Act; Application ........................   8
    SECTION 2.2  Lists of Holders of Securities ..........................   8
    SECTION 2.3  Reports by the Property Trustee .........................   9
    SECTION 2.4  Periodic Reports to Property Trustee ....................   9
    SECTION 2.5  Evidence of Compliance with Conditions Precedent ........   9
    SECTION 2.6  Events of Default; Waiver ...............................   9
    SECTION 2.7  Event of Default; Notice ................................  11

                                 ARTICLE III
                                ORGANIZATION

    SECTION 3.1  Name ....................................................  13
    SECTION 3.2  Office ..................................................  13
    SECTION 3.3  Purpose .................................................  13
    SECTION 3.4  Authority ...............................................  13
    SECTION 3.5  Title to Property of the Trust ..........................  14
    SECTION 3.6  Powers and Duties of the Regular Trustees ...............  14
    SECTION 3.7  Prohibition of Actions by the Trust and the Trustees ....  17
    SECTION 3.8  Powers and Duties of the Property Trustee ...............  18
    SECTION 3.9  Certain Duties and Responsibilities of the Property
                   Trustee ...............................................  20
    SECTION 3.10 Certain Rights of Property Trustee ......................  21
    SECTION 3.11 Delaware Trustee ........................................  24
    SECTION 3.12 Execution of Documents ..................................  24
    SECTION 3.13 Not Responsible for Recitals or Issuance
                   of Securities .........................................  24
    SECTION 3.14 Duration of Trust .......................................  25
    SECTION 3.15 Mergers .................................................  25

                                   ARTICLE IV
                                    SPONSOR

    SECTION 4.1  Sponsor's Purchase of Common Securities .................  27
    SECTION 4.2  Responsibilities of the Sponsor .........................  27

</TABLE>



<PAGE>   4


<TABLE>
                                  ARTICLE V
                                  TRUSTEES
<S>                                                                         <C>
    SECTION 5.1  Number of Trustees ......................................  28
    SECTION 5.2  Delaware Trustee ........................................  28
    SECTION 5.3  Property Trustee; Eligibility ...........................  29
    SECTION 5.4  Qualifications of Regular Trustees and Delaware
                   Trustee Generally .....................................  30
    SECTION 5.5  Initial Trustees ........................................  30
    SECTION 5.6  Appointment, Removal and Resignation of Trustees ........  30
    SECTION 5.7  Vacancies Among Trustees ................................  32
    SECTION 5.8  Effect of Vacancies .....................................  33
    SECTION 5.9  Meetings ................................................  33
    SECTION 5.10 Delegation of Power .....................................  33

                                 ARTICLE VI
                                DISTRIBUTIONS

    SECTION 6.1  Distributions ...........................................  34

                                 ARTICLE VII
                           ISSUANCE OF SECURITIES

    SECTION 7.1  General Provisions Regarding Securities .................  34

                                  ARTICLE VIII
                              TERMINATION OF TRUST

    SECTION 8.1  Termination of Trust ....................................  35

                                 ARTICLE IX
                            TRANSFER OF INTERESTS

    SECTION 9.1  Transfer of Securities ..................................  36
    SECTION 9.2  Transfer of Certificates ................................  37
    SECTION 9.3  Deemed Security Holders .................................  37
    SECTION 9.4  Book Entry Interests ....................................  38
    SECTION 9.5  Notices to Clearing Agency ..............................  39
    SECTION 9.6  Appointment of Successor Clearing Agency ................  39
    SECTION 9.7  Definitive Preferred Security Certificates ..............  39
    SECTION 9.8  Mutilated, Destroyed, Lost or Stolen Certificates .......  40

</TABLE>

<PAGE>   5



<TABLE>
                                  ARTICLE X
                         LIMITATION OF LIABILITY OF
                  HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
<S>                                                                         <C>
    SECTION 10.1 Liability ...............................................  40
    SECTION 10.2 Exculpation .............................................  41
    SECTION 10.3 Fiduciary Duty ..........................................  42
    SECTION 10.4 Indemnification .........................................  43
    SECTION 10.5 Outside Businesses ......................................  43

                                 ARTICLE XI
                                 ACCOUNTING

    SECTION 11.1 Fiscal Year .............................................  44
    SECTION 11.2 Certain Accounting Matters ..............................  44
    SECTION 11.3 Banking .................................................  45
    SECTION 11.4 Withholding .............................................  45

                                 ARTICLE XII
                           AMENDMENTS AND MEETINGS

    SECTION 12.1 Amendments ..............................................  46
    SECTION 12.2 Meetings of the Holders of Securities;
                   Action by Written Consent .............................  47

                                ARTICLE XIII
                     REPRESENTATIONS OF PROPERTY TRUSTEE

    SECTION 13.1 Representations and Warranties of Property Trustee ......  49

                                 ARTICLE XIV
                                MISCELLANEOUS

    SECTION 14.1 Notices .................................................  50
    SECTION 14.2 Governing Law ...........................................  51
    SECTION 14.3 Intention of the Parties ................................  52
    SECTION 14.4 Headings ................................................  52
    SECTION 14.5 Successors and Assigns ..................................  52
    SECTION 14.6 Partial Enforceability ..................................  52
    SECTION 14.7 Counterparts ............................................  52

</TABLE>


<PAGE>   6





                            AMENDED AND RESTATED
                            DECLARATION OF TRUST
                                     OF
                           HOUSEHOLD CAPITAL TRUST V
                               MARCH __, 2000

AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and effective
as of March __, 2000 by the undersigned trustees (together with all other
Persons from time to time duly appointed and serving as trustees in accordance
with the provisions of this Declaration, the "Trustees"), Household
International, Inc., a Delaware corporation, as trust sponsor (the "Sponsor"),
and by the holders, from time to time, of undivided beneficial interests in the
Trust to be issued pursuant to this Declaration;

WHEREAS, the Trustees and the Sponsor established a trust (the "Trust") under
the Delaware Business Trust Act pursuant to a Declaration of Trust, dated as of
March 21, 2000 (the "Original Declaration") and a Certificate of Trust filed
with the Secretary of State of Delaware on March 22, 2000, for the sole purpose
of issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust and investing the proceeds thereof in
certain Junior Subordinated Debt Securities of the Sponsor;

NOW, THEREFORE, it being the intention of the parties hereto to continue the
Trust as a statutory business trust under the Business Trust Act and that this
Declaration constitutes the governing instrument of such business trust, the
Trustees declare that all assets contributed to the Trust will be held in trust
for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.


                                  ARTICLE I

                       INTERPRETATION AND DEFINITIONS

SECTION 1.1 Definitions.

      (a)  Capitalized terms used in this Declaration but not defined in
           the preamble above have the respective meanings assigned to them in
           this Section 1.1;

      (b)  a term defined anywhere in this Declaration has the same
           meaning throughout;

      (c)  all references to "the Declaration" or "this Declaration" are
           to this Declaration of Trust as modified, supplemented or amended
           from time to time;


                                      1



<PAGE>   7




      (d)  all references in this Declaration to Articles and Sections
           and Exhibits are to Articles and Sections of and Exhibits to this
           Declaration unless otherwise specified;

      (e)  a term defined in the Trust Indenture Act has the same
           meaning when used in this Declaration unless otherwise defined in
           this Declaration or unless the context otherwise requires; and

      (f)  a reference to the singular includes the plural and vice
           versa.

"Affiliate" has the same meaning as given to that term in Rule 405 of the
Securities Act or any successor rule thereunder.

"Appointment Event" means an event defined in the terms of the Preferred
Securities as set forth in Exhibit A which entitles the Holders of a Majority
in liquidation amount of the Preferred Securities to appoint a Special Regular
Trustee.

"Authorized Officer" of a Person means any Person that is authorized to bind
such Person.

"Book Entry Interest" means a beneficial interest in a Global Certificate,
ownership and transfers of which shall be maintained and made through book
entries by a Clearing Agency as described in Section 9.4.

"Business Day" means any day other than a day on which banking institutions in
New York, New York, Chicago, Illinois, or the State of Delaware are authorized
or required by law to close.

"Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code, 12 Del.
C. Section Section  3801 et seq., as it may be amended from time to time.

"Certificate" means a Common Security Certificate or a Preferred Security
Certificate.

"Clearing Agency" means an organization registered as a "Clearing Agency"
pursuant to Section 17A of the Exchange Act that is acting as depository for
the Preferred Securities and in whose name or in the name of a nominee of that
organization, shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Preferred
Securities.

"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Clearing Agency
effects book entry transfers and pledges of securities deposited with the
Clearing Agency.



                                      2



<PAGE>   8



"Closing Date" means ____________________, 2000.

"Code" means the Internal Revenue Code of 1986, as amended.

"Commission" has the meaning specified in Section 3.6.

"Common Security" has the meaning specified in Section 7.1.

"Common Securities Guarantee" means the guarantee agreement of the Sponsor in
respect of the Common Securities.

"Common Security Certificate" means a definitive certificate in fully registered
form representing a Common Security substantially in the form of Annex II to
Exhibit A.

"Coupon Rate" has the meaning set forth in Section 2(a) of Exhibit A hereto.

"Covered Person" means:  (a)  any officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust; or (ii) the Trust's
Affiliates; and (b) any Holder of Securities.

"Debt Issuer" means Household International, Inc., a Delaware corporation.

"Debt Trustee" means Bank One, National Association, a national banking
association, as trustee under the Indenture until a successor is appointed
thereunder and thereafter means such successor trustee.

"Delaware Trustee" has the meaning set forth in Section 5.2.

"Definitive Preferred Security Certificates" has the meaning set forth in
Section 9.4.

"Direction" by a Person means a written direction signed (a) if the Person is a
natural person, by that Person; or (b) in any other case, in the name of such
Person by one or more Authorized Officers of that Person.

"Dissolution Tax Opinion" has the meaning set forth in Section 4(c) of Exhibit
A hereto.

"Distribution" means a distribution payable to Holders of Securities in
accordance with Section 6.1.

"DTC" means the Depository Trust Company, the initial Clearing Agency.

                                      3



<PAGE>   9





"Exchange Act" means the Securities Exchange Act of 1934, as amended from time
to time or any successor legislation.

"Event of Default" in respect of the Securities means an Event of Default (as
defined in the Indenture) has occurred and is continuing in respect of the
Notes.

"Global Certificate" has the meaning set forth in Section 9.4.

"Holder" means a Person in whose name a Certificate representing a Security is
registered, such Person being a beneficial owner within the meaning of the
Business Trust Act.

"Indemnified Person" means any Trustee, any Affiliate of any Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives or agents of any Trustee, or any employee or agent of the Trust
or its Affiliates.

"Indenture" means the Indenture dated as of May 15, 1995 among the Debt Issuer,
and The First National Bank of Chicago, a national banking association, as
trustee and the indenture supplemental thereto pursuant to which the Notes are
to be issued.

"Investment Company" means an investment company as defined in the Investment
Company Act.

"Investment Company Act" means the Investment Company Act of 1940, as amended
from time to time or any successor legislation.

"Legal Action" has the meaning set forth in Section 3.6(g).

"Majority in liquidation amount of the Securities" means, except as provided in
the terms of the Preferred Securities, Holder(s) of Securities voting together
as a single class or, as the context may require, Holder(s) of Preferred
Securities or Common Securities each, voting separately as a class, who vote
Securities of a relevant class, and the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or maturity,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of the Securities voted by such Holders represents
more than 50% of the above stated liquidation amount of all Securities of such
class.

"Ministerial Action" has the meaning set forth in the terms of the Securities
as set forth in Exhibit A.

"No Recognition Opinion" has the meaning set forth in Section 4(c) of Exhibit A
hereto.

"Notes" means the series of junior subordinated debt securities to be issued by
the Debt Issuer under the Indenture to the Property


                                      4



<PAGE>   10




Trustee, a specimen certificate for such series of Notes being Exhibit B.

"Officers' Certificate" means, with respect to any Person, a certificate signed
by two Authorized Officers of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Declaration shall include:

      (a)  a statement that each officer signing the Certificate has
           read the covenant or condition and the definition relating thereto;

      (b)  a brief statement of the nature and scope of the examination
           or investigation undertaken by each officer in rendering the
           Certificate;

      (c)  a statement that each such officer has made such examination
           or investigation as, in such officer's opinion, is necessary to
           enable such officer to express an informed opinion as to whether or
           not such covenant or condition has been complied with; and

      (d)  a statement as to whether, in the opinion of each such
           officer, such condition or covenant has been complied with.

"Paying Agent" has the meaning specified in Section 3.8(h).

"Person" means a legal entity, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever nature.

"Preferred Securities Guarantee" means the guarantee agreement of the Sponsor
in respect of the Preferred Securities.

"Preferred Security" has the meaning specified in Section 7.1.

"Preferred Security Beneficial Owner" means, with respect to a Book Entry
Interest, a Person who is the beneficial owner of such Book Entry Interest, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in accordance with the
rules of such Clearing Agency).

"Preferred Security Certificate" means a certificate representing a Preferred
Security substantially in the form of Annex I to Exhibit A.



                                      5



<PAGE>   11


"Property Trustee" means the Trustee meeting the eligibility requirements set
forth in Section 5.3.

"Property Account" has the meaning set forth in Section 3.8(c).

"Quorum" means a majority of the Regular Trustees or if there are only two
Regular Trustees, both of them.

"Redemption Tax Opinion" has the meaning set forth in Section 4(c) of Exhibit A
hereto.

"Regular Trustee" means any Trustee other than the Property Trustee and the
Delaware Trustee.

"Related Party" means, with respect to the Sponsor, any direct or indirect
wholly owned subsidiary of the Sponsor or any other Person which owns, directly
or indirectly, 100% of the outstanding voting securities of the Sponsor.

"Responsible Officer" means, with respect to the Property Trustee, the chairman
of the board of directors, the president, any vice-president, any assistant
vice-president, the secretary, any assistant secretary, the treasurer, any
assistant treasurer, any trust officer or assistant trust officer or any other
officer of the Property Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of that officer's knowledge of and familiarity with
the particular subject.

"Rule 3a-5" means Rule 3a-5 under the Investment Company Act.

"Securities" means the Common Securities and the Preferred Securities.

"Securities Act" means the Securities Act of 1933, as amended.

"Securities Guarantees" means the Common Securities Guarantee and the Preferred
Security Guarantee.

"66-2/3% in liquidation amount of the Securities" means, except as provided in
the terms of the Preferred Securities, Holder(s) of Securities voting together
as a single class or, as the context may require, Holder(s) of Preferred
Securities or Common Securities, each voting separately as a class, who vote
Securities of a relevant class, and the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or maturity,
plus accrued and unpaid Distributions, to the date upon which the voting
percentages are determined) of the Securities voted by such Holders represents
66-2/3% of the above-stated liquidation amount of all Securities of such class.



                                      6



<PAGE>   12


"Special Event" has the meaning set forth in the terms of the Securities.

"Special Regular Trustee" means a Regular Trustee appointed by the Holders of a
Majority in liquidation amount of the Preferred Securities in accordance with
Section 5.6(a)(ii)(B).

"Sponsor" means Household International, Inc., a Delaware corporation or any
successor entity in a merger, in its capacity as sponsor of the Trust.

"Successor Entity" has the meaning set forth in Section 3.15(b).

"Successor Property Trustee" means a successor Trustee possessing the
qualifications to act as Property Trustee under Section 5.3(a).

"Successor Securities" has the meaning set forth in Section 3.15(b).

"Super Majority" means where consent under the Indenture would require the
consent of greater than a majority of the holders in principal amount of Notes
affected thereby.

"Tax Event" has the meaning set forth in Section 4(c) of Exhibit A hereto.

"10% in liquidation amount of the Securities" means, except as provided in the
terms of the Preferred Securities, Holder(s) of Securities voting together as a
single class or, as the context may require, Holder(s) of Preferred Securities
or Common Securities, each voting separately as a class, who vote Securities of
a relevant class, and the liquidation amount (including the stated amount that
would be paid on redemption, liquidation or maturity, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined) of
the Securities voted by such Holders represents 10% of the above stated
liquidation amount of all Securities of such class.

"Treasury Regulations" means income tax regulations including temporary and
proposed regulations, promulgated under the Code by the United States
Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).

"Trustee" or "Trustees" means each Person who has signed this Declaration as a
trustee, so long as such Person shall continue in office in accordance with the
terms hereof, and all other Persons who may from time to time be duly
appointed, qualified and serving as Trustees in accordance with the provisions
hereof, and references herein to a Trustee or the Trustees shall refer to such
Person or Persons solely in their capacity as trustees hereunder.



                                      7



<PAGE>   13


"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.

"Underwriting Agreement" means the Underwriting Agreement for the offering and
sale of Preferred Securities in the form of Exhibit C.


                                 ARTICLE II
                             TRUST INDENTURE ACT

SECTION 2.1 Trust Indenture Act; Application.

      (a)  This Declaration is subject to the provisions of the Trust
           Indenture Act that are required to be part of this Declaration and
           shall, to the extent applicable, be governed by such provisions;

      (b)  the Property Trustee shall be the only Trustee which is a
           trustee for the purposes of the Trust Indenture Act;

      (c)  if and to the extent that any provision of this Declaration
           limits, qualifies or conflicts with the duties imposed by Section
           Section  310 to 317, inclusive, of the Trust Indenture Act, such
           imposed duties shall control; and

      (d)  the application of the Trust Indenture Act to this
           Declaration shall not affect the nature of the Securities as equity
           securities representing undivided beneficial interests in the assets
           of the Trust.

SECTION 2.2 Lists of Holders of Securities.

      (a)  Each of the Sponsor, the Debt Issuer and the Regular Trustees
           on behalf of the Trust shall provide the Property Trustee (i)
           within 14 days after each record date for payment of Distributions a
           list, in such form as the Property Trustee may reasonably require,
           of the names and addresses of the Holders of the Securities ("List
           of Holders") as of such record date, provided that none of the
           Sponsor, the Debt Issuer or the Regular Trustees on behalf of the
           Trust shall be obligated to provide such List of Holders at any time
           the List of Holders does not differ from the most recent List of
           Holders given to the Property Trustee by the Sponsor, the Debt
           Issuer and the Regular Trustees on behalf of the Trust, and (ii) at
           any other time, within 30 days of receipt by the Trust of a written
           request for a List of Holders as of a date no more than 14 days
           before such List of Holders is given to the Property Trustee. The
           Property Trustee shall preserve, in as current a form as is
           reasonably practicable, all information contained in Lists of


                                      8



<PAGE>   14





           Holders given to it or which it receives in its capacity as Paying
           Agent (if acting in such capacity) provided that the Property
           Trustee may destroy any List of Holders previously given to it on
           receipt of a new List of Holders; and (b) the Property Trustee
           shall comply with its obligations under Sections 311(a), 311(b)
           and Section 312(b) of the Trust Indenture Act.

SECTION 2.3 Reports by the Property Trustee.

Within 60 days after May 15 of each year, the Property Trustee shall provide to
the Holders of the Preferred Securities such reports as are required by Section
313 of the Trust Indenture Act, if any, in the form and in the manner provided
by Section  313 of the Trust Indenture Act. The Property Trustee shall also
comply with the requirements of Section  313(d) of the Trust Indenture Act.

SECTION 2.4 Periodic Reports to Property Trustee.

Each of the Sponsor, the Debt Issuer and the Regular Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as required by Section  314 (if any) and the compliance certificate
required by Section  314 of the Trust Indenture Act in the form, in the manner
and at the times required by Section 314 of the Trust Indenture Act.

SECTION 2.5 Evidence of Compliance with Conditions Precedent.

Each of the Sponsor, the Debt Issuer and the Regular Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Declaration which
relate to any of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to
Section  314(c)(1) may be given in the form of an Officers' Certificate.

SECTION 2.6 Events of Default; Waiver.

      (a)  The Holders of a Majority in liquidation amount of Preferred
           Securities may, by vote, on behalf of the Holders of all of the
           Preferred Securities, waive any past Event of Default in respect of
           the Preferred Securities and its consequences provided that if the
           Event of Default arises out of an Event of Default under the
           Indenture:

           (i)   which is not waivable under the Indenture, the
                 Event of Default under the Declaration shall also not be
                 waivable; or



                                      9



<PAGE>   15




            (ii) which requires the consent or vote of all or a
                 Super Majority of the holders of the Notes to be waived under
                 the Indenture, the Event of Default under the Declaration may
                 only be waived by the vote of all of the Holders of the
                 Preferred Securities or such proportion thereof in liquidation
                 amount as represents the relevant Super Majority of the
                 aggregate principal amount of Notes outstanding.

            Upon such waiver, any such default shall cease to exist, and any
            Event of Default with respect to the Preferred Securities arising
            therefrom shall be deemed to have been cured, for every purpose of
            this Declaration, but no such waiver shall extend to any subsequent
            or other default or Event of Default with respect to the Preferred
            Securities or impair any right consequent thereon. Any waiver by
            the Holders of the Preferred Securities of an Event of Default with
            respect to the Preferred Securities shall also be deemed to
            constitute a waiver by the Holders of the Common Securities of any
            such Event of Default with respect to the Common Securities.

      (b)   The Holders of a Majority in liquidation amount of the Common
            Securities may, by vote, on behalf of the Holders of all of the
            Common Securities, waive any past Event of Default with respect
            to the Common Securities and its consequences, provided that, if
            the Event of Default arises out of an Event of Default under the
            Indenture:

            (i)  which is not waivable under the Indenture, except
                 where the Holders of the Common Securities are deemed to have
                 waived such Event of Default under the Declaration as provided
                 below, the Event of Default under the Declaration is not
                 waivable; or

            (ii) which requires the consent or vote of all or a
                 Super Majority of the holders of the Notes to be waived under
                 the Indenture, the Event of Default under the Declaration may
                 only be waived by the vote of all of the Holders of the
                 Preferred Securities or such proportion thereof in liquidation
                 amount as represents the relevant Super Majority of the
                 aggregate principal amount of the Notes outstanding,

            provided that, each Holder of Common Securities will be deemed to
            have waived any such Event of Default and all Events of Default
            with respect to the Common Securities until all Events of Default
            with respect to the Preferred Securities have been cured, waived or
            otherwise eliminated and until such Events of Default have been so


                                     10



<PAGE>   16



            cured, waived or otherwise eliminated, the Property Trustee will be
            deemed to be acting solely on behalf of the Holders of the
            Preferred Securities and only the Holders of the Preferred
            Securities will have the right to direct the Property Trustee in
            accordance with the terms of the Securities. Subject to the
            foregoing proviso, upon such waiver, any such default shall cease
            to exist and any Event of Default with respect to the Common
            Securities arising therefrom shall be deemed to have been cured,
            for every purpose of this Declaration, but no such waiver shall
            extend to any subsequent or other default or Event of Default with
            respect to the Common Securities or impair any right consequent
            thereon.

      (c)   A waiver of an event of default under the Indenture by the Property
            Trustee at the direction of the Holders of the Preferred Securities,
            constitutes a waiver of the corresponding Event of Default under
            this Declaration.

SECTION 2.7 Event of Default; Notice

      (a)   The Property Trustee shall, within 90 days after the occurrence
            of an Event of Default, transmit by mail, first class postage
            prepaid, to the Holders of the Securities, notices of all
            defaults with respect to the Securities known to the Property
            Trustee, unless such defaults have been cured before the giving of
            such notice (the term "defaults" for the purposes of this Section
            2.7(a) being hereby defined to be an Event of Default as defined in
            the Indenture, not including any periods of grace provided for
            therein and irrespective of the giving of any notice provided
            therein); provided, that, except for a default in the payment of
            principal of (or premium, if any) or interest on any of the Notes
            or in the payment of any sinking fund installment established for
            the Notes, the Property Trustee shall be protected in withholding
            such notice if and so long as the board of directors, the executive
            committee, or a trust committee of directors and/or Responsible
            Officers, of the Property Trustee in good faith determine that the
            withholding of such notice is in the interests of the Holders of
            the Securities.

      (b)   The Property Trustee shall not be deemed to have knowledge of any
            default except:

            (i)  a default under Sections 6.01(a)(1) and 6.01(a)(2) of the
                 Indenture; or

            (ii) any default as to which the Property Trustee shall have
                 received written notice or a Responsible


                                     11


<PAGE>   17


                  Officer charged with the administration of the Declaration
                  shall have obtained written notice of.


                                 ARTICLE III

                                ORGANIZATION

SECTION 3.1 Name.

The Trust created hereby shall be known as "Household Capital Trust V", as such
name may be modified from time to time by the Regular Trustees following written
notice to the Holders of Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the Regular
Trustees.

SECTION 3.2 Office.

The address of the principal office of the Trust is c/o Household International,
Inc., 2700 Sanders Road, Prospect Heights, Illinois  60070. On ten Business Days
written notice to the Holders of Securities, the Regular Trustees may designate
another principal office.

SECTION 3.3 Purpose.

The exclusive purposes and functions of the Trust are (a) to issue and sell
Securities and use the proceeds from such sale to acquire the Notes, and (b)
except as otherwise limited herein, to enter into such agreements and engage in
only those other activities necessary, or incidental thereto. The Trust shall
not borrow money, issue debt or reinvest proceeds derived from investments,
pledge any of its assets, or otherwise undertake (or permit to be undertaken)
any activity that would cause the Trust to be classified for United States
federal income tax purposes as other than grantor trust.

SECTION 3.4 Authority.

Subject to the limitations provided in this Declaration and to the specific
duties of the Property Trustee, the Regular Trustees shall have exclusive and
complete authority to carry out the purposes of the Trust. An action taken by
the Regular Trustees in accordance with their powers shall constitute the act
of and serve to bind the Trust and an action taken by the Property Trustee in
accordance with its powers shall constitute the act of and serve to bind the
Trust. In dealing with the Trustees acting on behalf of the Trust, no person
shall be required to inquire into the authority of the Trustees to bind the
Trust. Persons dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this Declaration.


                                     12


<PAGE>   18


SECTION 3.5 Title to Property of the Trust.

Except as provided in Section 3.8 with respect to the Notes and the Property
Account or as otherwise provided in this Declaration, legal title to all assets
of the Trust shall be vested in the Trust. The Holders shall not have legal
title to any part of the assets of the Trust, but shall have an undivided
beneficial interest in the assets of the Trust.

SECTION 3.6 Powers and Duties of the Regular Trustees.

The Regular Trustees shall have the exclusive power and authority and duty to
cause the Trust to engage in the following activities:

      (a)  to issue and sell the Preferred Securities and the Common
           Securities in accordance with this Declaration; provided, however,
           that the Trust may issue no more than one series of Preferred
           Securities and no more than one series of Common Securities, and,
           provided further, there shall be no interests in the Trust other
           than the Securities and the issuance of Securities shall be limited
           to a one time, simultaneous issuance of both Preferred Securities
           and Common Securities on the Closing Date;

      (b)  in connection with the issue and sale of the Preferred
           Securities, at the direction of the Sponsor, to:

           (i)   execute and file with the Securities and Exchange Commission
                 (the "Commission") the registration statement on Form S-3
                 prepared by the Sponsor in relation to the Preferred
                 Securities, including any amendments thereto prepared by the
                 Sponsor;

           (ii)  execute and file any documents prepared by the Sponsor, or
                 take any acts as determined by the Sponsor as necessary in
                 order to qualify or register all or part of the Preferred
                 Securities in any State in which the Sponsor has determined to
                 qualify or register such Preferred Securities for sale;

           (iii) execute and file an application prepared by the Sponsor
                 to the New York Stock Exchange or any other national stock
                 exchange or the NASDAQ National Market for listing upon notice
                 of issuance of any Preferred Securities;


           (iv)  execute and file with the Commission a registration statement
                 on Form 8-A prepared by the Sponsor relating to the
                 registration of the Preferred Securities under Section 12(b)
                 of the Exchange Act,


                                     13


<PAGE>   19


                 including any amendments thereto prepared by the Sponsor; and

           (v)   execute and enter into the Underwriting Agreement providing
                 for the sale of the Preferred Securities;

      (c)  to acquire the Notes with the proceeds of the sale of the
           Preferred Securities and the Common Securities; provided, however,
           that the Regular Trustees shall cause legal title to the Notes to be
           held of record in the name of the Property Trustee for the benefit
           of the Holders of the Preferred Securities and the Common
           Securities;

      (d)  to give the Debt Issuer, the Sponsor and the Property Trustee
           prompt written notice of the occurrence of a Special Event provided,
           that the Regular Trustees shall consult with the Debt Issuer, the
           Sponsor and the Property Trustee before taking or refraining from
           taking any Ministerial Action in relation to a Special Event;

      (e)  to establish a record date with respect to all actions to be
           taken hereunder that require a record date be established, including
           for the purposes of Section 316(c) of the Trust Indenture Act and
           with respect to Distributions, voting rights, redemptions and
           exchanges, and to issue relevant notices to the Holders of Preferred
           Securities and Common Securities as to such actions and applicable
           record dates;

      (f)  to take all actions and perform such duties as may be
           required of the Regular Trustees pursuant to the terms of the
           Securities;

      (g)  to bring or defend, pay, collect, compromise, arbitrate,
           resort to legal action, or otherwise adjust claims or demands of or
           against the Trust ("Legal Action"), unless pursuant to 3.8(e), the
           Property Trustee has the exclusive power to bring such Legal Action;

      (h)  to employ or otherwise engage employees and agents (who may
           be designated as officers with titles) and managers, contractors,
           advisors, and consultants and pay reasonable compensation for such
           services;

      (i)  to cause the Trust to comply with the Trust's obligations under the
           Trust Indenture Act;

      (j)  to give the certificate to the Property Trustee required by
           Section 314(a)(4) of the Trust Indenture Act which certificate may
           be executed by any Regular Trustee;


                                     14


<PAGE>   20



      (k)  incur expenses which are necessary or incidental to carry out
           any of the purposes of the Trust;

      (l)  to act as, or appoint another Person to act as, registrar and
           transfer agent for the Securities;

      (m)  to give prompt written notice to the Holders of the
           Securities of any notice received from the Debt Issuer of its
           election to defer payments of interest on the Notes by extending the
           interest payment period under the Indenture;

      (n)  to execute all documents or instruments, perform all duties
           and powers, and do all things for and on behalf of the Trust in all
           matters necessary or incidental to the foregoing;

      (o)  to take all action which may be necessary or appropriate for
           the preservation and the continuation of the Trust's valid
           existence, rights, franchises and privileges as a statutory business
           trust under the laws of the State of Delaware and of each other
           jurisdiction in which such existence is necessary to protect the
           limited liability of the Holders of the Securities or to enable the
           Trust to effect the purposes for which the Trust was created;

      (p)  to take any action, not inconsistent with this Declaration or
           with applicable law, which the Regular Trustees determine in their
           discretion to be necessary or desirable in carrying out the
           activities of the Trust as set out in this Section 3.6 including,
           but not limited to:

           (i)   causing the Trust not to be deemed to be an Investment
                 Company required to be registered under the Investment
                 Company Act;

           (ii)  causing the Trust to be characterized for United States
                 federal income tax purposes as other than a grantor trust; and

           (iii) cooperating with the Debt Issuer to ensure that the Notes
                 will be treated as indebtedness of the Debt Issuer for
                 United States federal income tax purposes, provided that such
                 action does not adversely affect the interests of Holders; and

      (q)  to take all action necessary to cause all applicable tax returns
           and tax information reports that are required to be filed with
           respect to the Trust to be duly prepared and filed by the Regular
           Trustees, on behalf of the Trust.


                                     15


<PAGE>   21



The Regular Trustees must exercise the powers set forth in this Section 3.6 in
a manner which is consistent with the purposes and functions of the Trust set
out in Section 3.3 and the Regular Trustees shall not take any action which is
inconsistent with the purposes and functions of the Trust set forth in Section
3.3. Subject to this Section 3.6, the Regular Trustees shall have none of the
powers or the authority of the Property Trustee set forth in Section 3.8.

SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.

      (a)   The Trust shall not, and the Trustees (including the Property
            Trustee) shall cause the Trust not to, engage in any activity other
            than as required or authorized by this Declaration. In particular,
            the Trust shall not and the Trustees (including the Property
            Trustee) shall not:

            (i)   invest any proceeds received by the Trust from holding the
                  Notes but shall distribute all such proceeds to Holders of
                  Securities pursuant to the terms of this Declaration and of
                  the Securities;

            (ii)  acquire any assets other than as expressly provided herein;

            (iii) possess Trust property for other than a Trust purpose;

            (iv)  make any loans or incur any indebtedness other than loans
                  represented by the Notes;

            (v)   possess any power or otherwise act in such a way as to vary
                  the Trust assets or the terms of the Securities in any way
                  whatsoever;

            (vi)  issue any securities or other evidences of beneficial
                  ownership of, or beneficial interest in, the Trust other
                  than the Securities; or

            (vii) (A)  direct the time, method and place of exercising any
                  trust or power conferred upon the Debt Trustee with respect
                  to the Notes, (B) waive any past default that is
                  waivable under Section 7.13 of the Indenture, (C) exercise
                  any right to rescind or annul any declaration that the
                  principal of all the Notes shall be due and payable or (D)
                  consent to any amendment, modification or termination of the
                  Indenture or the Notes, where such consent shall be required,
                  unless the Trust shall have received an opinion of counsel to
                  the effect that such modification will not cause more than an
                  insubstantial risk that for United States


                                     16


<PAGE>   22

                  federal income tax purposes the Trust will be characterized
                  as other than a grantor trust.

SECTION 3.8 Powers and Duties of the Property Trustee.

      (a)  The legal title to the Notes shall be owned by and held of
           record in the name of the Property Trustee in trust for the benefit
           of the Holders of the Securities. The right, title and interest of
           the Property Trustee to the Notes shall vest automatically in each
           Person who may hereafter be appointed as Property Trustee as set
           forth in Section 5.6. Such vesting and cessation of title shall be
           effective whether or not conveyancing documents have been executed
           and delivered.

      (b)  The Property Trustee shall not transfer its right, title and
           interest in the Notes to the Regular Trustees or to the Delaware
           Trustee (if the Property Trustee does not also act as Delaware
           Trustee).

      (c)  The Property Trustee shall:

           (i)   establish and maintain a segregated non-interest
                 bearing bank account (the "Property Account") in the name of
                 and under the exclusive control of the Property Trustee on
                 behalf of the Holders of the Securities and, upon the receipt
                 of payments of funds made in respect of the Notes held by the
                 Property Trustee, deposit such funds into the Property Account
                 and make payments to the Holders of the Preferred Securities
                 and the Common Securities from the Property Account in
                 accordance with Section 6.1. Funds in the Property Account
                 shall be held uninvested until disbursed in accordance with
                 this Declaration. The Property Account shall be an account
                 which is maintained with a banking institution the rating on
                 whose long term unsecured indebtedness is at least equal to
                 the rating assigned to the Preferred Securities by a
                 "nationally recognized statistical rating organization", as
                 that term is defined for purposes of Rule 436(g)(2) under the
                 Securities Act;

           (ii)  engage in such ministerial activities as shall be
                 necessary or appropriate to effect the redemption of the
                 Preferred Securities and the Common Securities to the extent
                 the Notes are redeemed or mature; and

           (iii) upon notice of distribution issued by the Regular Trustees in
                 accordance with the terms of the Preferred Securities and the
                 Common Securities,

                                     17


<PAGE>   23



                 engage in such ministerial activities as shall be
                 necessary or appropriate to effect the distribution of the
                 Notes to Holders of Securities upon the occurrence of certain
                 special events (as may be defined in the terms of the
                 Securities) arising from a change in law or a change in legal
                 interpretation or other specified circumstances pursuant to
                 the terms of the Securities;

      (d)  the Property Trustee shall take all actions and perform such duties
           as may be specifically required of the Property Trustee pursuant
           to the terms of the Securities;

      (e)  the Property Trustee shall take any Legal Action which arises
           out of or in connection with an Event of Default or the Property
           Trustee's duties and obligations under this Declaration or the Trust
           Indenture Act;

      (f)  the Property Trustee shall not resign as a Trustee unless either:

           (i)   the Trust has been completely liquidated and the proceeds of
                 the liquidation distributed to the Holders of Securities
                 pursuant to the terms of the Securities; or

           (ii)  a Successor Property Trustee has been appointed and accepted
                 that appointment in accordance with Section 5.6;

      (g)  the Property Trustee shall have the legal power to exercise all of
           the rights, powers and privileges of a holder of Notes under the
           Indenture and, if an Event of Default occurs and is continuing,
           the Property Trustee shall, for the benefit of Holders of the
           Securities, enforce its rights as holder of the Notes subject to the
           rights of the Holders pursuant to the terms of such Securities;

      (h)  the Property Trustee may authorize one or more Persons (each, a
           "Paying Agent") to pay Distributions, redemption payments or
           liquidation payments on behalf of the Trust with respect to either
           or both of the Preferred Securities and the Common Securities and
           any such Paying Agent shall comply with Section  317(b) of the Trust
           Indenture Act. Any Paying Agent may be removed by the Property
           Trustee at any time and a successor Paying Agent or additional
           Paying Agents may be appointed at any time by the Property Trustee;
           and



                                     18

<PAGE>   24


      (i)  subject to this Section 3.8, the Property Trustee shall have
           none of the powers or the authority of the Regular Trustees set
           forth in Section 3.6.

The Property Trustee must exercise the powers set forth in this Section 3.8 in
a manner which is consistent with the purposes and functions of the Trust set
forth in Section 3.3 and the Property Trustee shall not take any action which
is inconsistent with the purposes and functions of the Trust set out in Section
3.3.

SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee

      (a)  The Property Trustee, before the occurrence of any Event of
           Default and after the curing of all Events of Default that may have
           occurred, shall undertake to perform only such duties as are
           specifically set forth in this Declaration and in the terms of the
           Securities, and no implied covenants shall be read into this
           Declaration against the Property Trustee. In case an Event of
           Default has occurred (that has not been cured or waived pursuant to
           Section 2.6), the Property Trustee shall exercise such of the rights
           and powers vested in it by this Declaration, and use the same degree
           of care and skill in their exercise, as a prudent person would
           exercise or use under the circumstances in the conduct of his or her
           own affairs;

      (b)  no provision of this Declaration shall be construed to relieve the
           Property Trustee from liability for its own negligent action, its
           own negligent failure to act, or its own willful misconduct, except
           that:

           (i)   prior to the occurrence of any Event of Default and after the
                 curing or waiving of all such Events of Default that may have
                 occurred:

                 (A)   the duties and obligations of the Property Trustee shall
                       be determined solely by the express provisions of this
                       Declaration and in the terms of the Securities, and the
                       Property Trustee shall not be liable except for the
                       performance of such duties and obligations as are
                       specifically set forth in this Declaration, and no
                       implied covenants or obligations shall be read into this
                       Declaration against the Property Trustee; and

                  (B)  in the absence of bad faith on the part of the Property
                       Trustee, the Property Trustee may conclusively rely, as
                       to the truth of the statements and the correctness of
                       the opinions



                                     19

<PAGE>   25


                       expressed therein, upon any certificates or opinions
                       furnished to the Property Trustee and conforming to the
                       requirements of this Declaration; but in the case of
                       any such certificates or opinions that by any provision
                       hereof are specifically required to be furnished to the
                       Property Trustee, the Property Trustee shall be under a
                       duty to examine the same to determine whether or not
                       they conform to the requirements of this Declaration;

           (ii)  the Property Trustee shall not be liable for any error of
                 judgment made in good faith by a Responsible Officer of the
                 Property Trustee, unless it shall be proved that the Property
                 Trustee was negligent in ascertaining the pertinent facts;

           (iii) the Property Trustee shall not be liable with respect to
                 any action taken or omitted to be taken by it in good faith in
                 accordance with the direction of the Holders of not less than a
                 Majority in liquidation amount of the Securities at the time
                 outstanding relating to the time, method and place of
                 conducting any proceeding for any remedy available to the
                 Property Trustee, or exercising any trust or power conferred
                 upon the Property Trustee under this Declaration; and

           (iv)  no provision of this Declaration shall require the Property
                 Trustee to expend or risk its own funds or otherwise incur
                 personal financial liability in the performance of any of its
                 duties or in the exercise of any of its rights or powers, if
                 it shall have reasonable ground for believing that the
                 repayment of such funds or liability is not reasonably assured
                 to it under the terms of this Declaration or adequate
                 indemnity against such risk or liability is not reasonably
                 assured to it.

SECTION 3.10 Certain Rights of Property Trustee.

      (a)  Subject to the provisions of Section 3.9:

           (i)   the Property Trustee may rely and shall be fully protected in
                 acting or refraining from acting upon any resolution,
                 certificate, statement, instrument, opinion, report, notice,
                 request, direction, consent, order, bond, debenture, note,
                 other evidence of indebtedness or other paper or document


                                     20


<PAGE>   26


                 believed by it to be genuine and to have been signed, sent or
                 presented by the proper party or parties;

           (ii)  any direction or act of the Sponsor or the Regular Trustees
                 contemplated by this Declaration shall be sufficiently
                 evidenced by a Direction or an Officers' Certificate;

           (iii) whenever in the administration of this Declaration, the
                 Property Trustee shall deem it desirable that a matter be
                 proved or established before taking, suffering or omitting any
                 action hereunder, the Property Trustee (unless other evidence
                 is herein specifically prescribed) may, in the absence of bad
                 faith on its part and, if the Trust is excluded from the
                 definition of an Investment Company solely by means of Rule
                 3a-7, subject to the requirements of Rule 3a-7, request and
                 rely upon an Officers' Certificate which, upon receipt of such
                 request, shall be promptly delivered by the Sponsor or the
                 Regular Trustees;

           (iv)  the Property Trustee shall have no duty to see to
                 any recording, filing or registration of any instrument (or
                 any rerecording, refiling or registration thereof);

           (v)   the Property Trustee may consult with counsel and
                 the written advice or opinion of such counsel with respect to
                 legal matters shall be full and complete authorization and
                 protection in respect of any action taken, suffered or omitted
                 by it hereunder in good faith and in accordance with such
                 advice or opinion. Such counsel may be counsel to the Sponsor
                 or any of its Affiliates, and may include any of its
                 employees. The Property Trustee shall have the right at any
                 time to seek instructions concerning the administration of
                 this Declaration from any court of competent jurisdiction;

           (vi)  the Property Trustee shall be under no obligation to exercise
                 any of the rights or powers vested in it by this Declaration
                 at the request or direction of any Holder, unless such Holder
                 shall have provided to the Property Trustee adequate security
                 and indemnity which would satisfy a reasonable person in the
                 position of the Property Trustee, against the  costs, expenses
                 (including attorneys' fees and expenses) and liabilities that
                 might be incurred by it in complying with such request or
                 direction, including such reasonable advances as



                                     21


<PAGE>   27

                  may be requested by the Property Trustee provided, that,
                  nothing contained in this Section 3.10 (a) (vi) shall be
                  taken to relieve the Property Trustee, upon the occurrence of
                  an Event of Default, of its obligation to exercise the rights
                  and powers vested in it by this Declaration;

           (vii)  the Property Trustee shall not be bound to make any
                  investigation into the facts or matters stated in any
                  resolution, certificate, statement, instrument, opinion,
                  report, notice, request, direction, consent, order, bond,
                  debenture, note, other evidence of indebtedness or other
                  paper or document, but the    Property Trustee, in its
                  discretion, may make such further inquiry or investigation
                  into such facts or matters as it may see fit;

           (viii) the Property Trustee may execute any of the trusts or powers
                  hereunder or perform any duties hereunder either directly or
                  by or through agents or attorneys and the Property Trustee
                  shall not be  responsible for any misconduct or negligence on
                  the part of any agent or attorney appointed with due care by
                  it hereunder;

           (ix)   any action taken by the Property Trustee or its agents
                  hereunder shall bind the Trust and the Holders of the
                  Securities and the signature of the Property Trustee or its
                  agents alone shall be sufficient and effective to perform any
                  such action; and no third party shall be required to inquire
                  as to the authority of the Property Trustee to so act, or as
                  to its compliance with any of the terms and provisions of
                  this Declaration, both of which shall be conclusively
                  evidenced by the Property Trustee's or its agent's taking
                  such action;

           (x)    whenever in the administration of this Declaration the
                  Property Trustee shall deem it desirable to receive
                  instructions with respect to enforcing any remedy or right or
                  taking any other action hereunder the Property Trustee (i)
                  may request instructions from the Holders of the
                  Securities, (ii) may refrain from enforcing such remedy or
                  right or taking such other action until such instructions are
                  received, and (iii) shall be protected in acting in
                  accordance with such instructions; and



                                     22


<PAGE>   28




           (xi)   except as otherwise expressly provided by this Declaration,
                  the Property Trustee shall not be under any obligation to
                  take any action that is discretionary under the provisions of
                  this Declaration except upon the Direction of the Sponsor or
                  the Regular Trustees as the case may be.

     (b) No provision of this Declaration shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Property Trustee
shall be construed to be a duty.

SECTION 3.11 Delaware Trustee

     Notwithstanding any other provision of this Declaration other than Section
5.2, the Delaware Trustee shall not be entitled to exercise any powers, nor
shall the Delaware Trustee have any of the duties and responsibilities of the
Regular Trustees and the Property Trustee described in this Declaration. Except
as set forth in Section 5.2, the Delaware Trustee shall be a Trustee for the
sole and limited purpose of fulfilling the requirements of Section  3807 of the
Business Trust Act.

SECTION 3.12 Execution of Documents

Unless otherwise determined by the Regular Trustees and except as otherwise
required by the Business Trust Act, a majority of, or if there are only two,
both of the Regular Trustees are authorized to execute on behalf of the Trust
any documents which the Regular Trustees have the power and authority to
execute pursuant to Section 3.6, provided that any listing application prepared
by the Sponsor referred to in Section 3.6(b)(iii) may be executed by any
Regular Trustee.

SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.

The recitals contained in this Declaration and the Securities shall be taken
as the statements of the Sponsor and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as
to the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.



                                     23


<PAGE>   29


SECTION 3.14 Duration of Trust.

The Trust, unless terminated pursuant to the provisions of Article VIII hereof,
shall have existence for 55 years from the Closing Date.

SECTION 3.15 Mergers.

      (a)  The Trust may not consolidate, amalgamate, merge with or
           into, or be replaced by, or convey, transfer or lease its properties
           and assets substantially as an entirety to any corporation or other
           body, except as described in Section 3.15 (b) and (c).

      (b)  The Trust may, with the consent of a majority of the Regular
           Trustees and without the consent of the Holders of the Securities,
           the Delaware Trustee or the Property Trustee, consolidate,
           amalgamate, merge with or into, or be replaced by a trust organized
           as such under the laws of any state; provided, that:

            (i)  such successor entity (the "Successor Entity")
                 either:

                  (A)  expressly assumes all of the obligations of the Trust
                       under the Preferred Securities; or

                  (B)  substitutes for the Preferred Securities other securities
                       having substantially the same terms as the Preferred
                       Securities (the "Successor Securities") so long as the
                       Successor Securities rank the same as the Preferred
                       Securities rank with respect to priority of Distributions
                       and payments upon liquidation, redemption and maturity;

            (ii) the Debt Issuer expressly acknowledges a trustee of the
                 Successor Entity which possesses the same powers and duties as
                 the Property Trustee as the Holder of the Notes;

        (iii) the Preferred Securities or any Successor Securities are
             listed, or any Successor Securities will be listed upon
             notification of issuance, on any national securities exchange or
             other organization on which the Preferred Securities are then
             listed;

            (iv) such merger, consolidation, amalgamation or replacement does
                 not cause the Preferred Securities (including any Successor
                 Securities) to be



                                     24


<PAGE>   30


                 downgraded by any nationally recognized statistical rating
                 organization;

            (v)  such merger, consolidation, amalgamation or replacement does
                 not adversely affect the rights, preferences and privileges of
                 the Holders of the Preferred Securities (including any
                 Successor Securities) in any material respect (other than with
                 respect to any dilution of the Holders' interest in the new
                 entity);

            (vi) such successor entity has a purpose identical to that of the
                 Trust;

           (vii) prior to such merger, consolidation, amalgamation or
                 replacement, the Sponsor has received an opinion of a
                 nationally recognized independent counsel to the Trust
                 experienced in such matters to the effect that:

                  (A)  such merger, consolidation, amalgamation or replacement
                       does not adversely affect the rights, preferences and
                       privileges of the Holders of the Preferred Securities
                       (including any Successor Securities) in any material
                       respect (other than with respect to any dilution of the
                       Holders' interest in the new entity); and

                  (B)  following such merger, consolidation, amalgamation or
                       replacement, neither the Trust nor the Successor Entity
                       will be required to register as an Investment Company;
                       and

               (viii)  the Sponsor guarantees the obligations of such Successor
                       Entity under the Successor Securities at least to the
                       extent provided by the Preferred Securities Guarantee;
                       and

      (c)   notwithstanding Section 3.15(b), the Trust shall not consolidate,
            amalgamate, merge with or into, or be replaced by any other entity
            or permit any other entity to consolidate, amalgamate,  merge with
            or into, or replace it if such consolidation, amalgamation, merger
            or replacement would cause the Trust or Successor Entity for United
            States federal income tax purposes to be classified as other than a
            grantor trust, except with the consent of Holders of 100% in
            liquidation amount of the Securities.




                                     25

<PAGE>   31
                                  ARTICLE IV

                                   SPONSOR

SECTION 4.1 Sponsor's Purchase of Common Securities.

On the Closing Date the Sponsor will purchase all the Common Securities issued
by the Trust, at the same time as the Preferred Securities are sold, in an
amount equal to 3% of the capital of the Trust.

SECTION 4.2 Responsibilities of the Sponsor.

In connection with the issue and sale of the Preferred Securities, the Sponsor
shall have the exclusive right and responsibility to engage in the following
activities:

      (a)  to prepare for filing by the Trust with the Commission a
           registration statement on Form S-3 in relation to the Preferred
           Securities, including any amendments thereto;

      (b)  to determine the states in which to take appropriate action to
           qualify or register for sale all or part of the Preferred Securities
           and to take any and all such acts, other than actions which must be
           taken by the Trust, and advise the Trust of actions it must take,
           and prepare for execution and filing any documents to be executed
           and filed by the Trust, as the Sponsor deems necessary or advisable
           in order to comply with the applicable laws of any such states;

      (c)  to prepare for filing by the Trust an application to the New York
           Stock Exchange or any other national stock exchange or the Nasdaq
           National Market for listing upon notice of issuance of any Preferred
           Securities;

      (d)  to prepare for filing by the Trust with the Commission a
           registration statement on Form 8-A relating to the registration of
           the Preferred Securities under Section 12(b) of the Exchange Act,
           including any amendments thereto; and

      (e)  to negotiate the terms of the Underwriting Agreement providing for
           the sale of the Preferred Securities.



                                     26


<PAGE>   32

                                   ARTICLE V

                                    TRUSTEES


SECTION 5.1 Number of Trustees.

      The number of Trustees shall initially be three (3), and:

      (a)  at any time before the issuance of any Securities, the Sponsor may,
           by written instrument, increase the number of Trustees; and

      (b)  after the issuance of any Securities:

            (i)  and except as provided in Section 5.1 (b)(ii)and  5.6 (a) (ii)
                 (B) with respect to the Special Regular Trustee, the number of
                 Trustees may be increased or decreased by vote of the Holders
                 of a Majority in liquidation amount of the Common Securities
                 voting as a class at a meeting of the Holders of the Common
                 Securities; and

            (ii) the number of Trustees shall be increased automatically by one
                 (1) if an Appointment Event has occurred and is continuing and
                 the Holders of a Majority in liquidation amount of the
                 Preferred Securities appoint a Special Regular Trustee in
                 accordance with Section 5.6,

provided that in any case, the number of Trustees shall be at least three (3)
so long as the Trustee that acts as the Property Trustee also acts as the
Delaware Trustee pursuant to Section 5.2.  In the event the Property Trustee is
not also acting as the Delaware Trustee, the number of Trustees shall be at
least five (5).

SECTION 5.2 Delaware Trustee.

If required by the Business Trust Act, one Trustee (the "Delaware Trustee")
shall be:

      (a)  a natural person who is a resident of the State of Delaware;
           or

      (b)  if not a natural person, an entity which has its principal
           place of business in the State of Delaware and otherwise meets the
           requirements of applicable law,

      provided that if the Property Trustee has its principal place of business
      in the State of Delaware and otherwise meets the


                                     27



<PAGE>   33
      requirements of applicable law, then the Property Trustee shall also be
      the Delaware Trustee and Section 3.11 shall have no application.

SECTION 5.3 Property Trustee; Eligibility.

      (a)  There shall at all times be one Trustee (which may be the
           Delaware Trustee) which shall act as Property Trustee which shall:

            (i)  not be an Affiliate of the Sponsor; and

            (ii) be a corporation organized and doing business
                 under the laws of the United States of America or any state or
                 territory thereof or of the District of Columbia, or a
                 corporation or Person permitted by the Commission to act as an
                 institutional trustee under the Trust Indenture Act,
                 authorized under such laws to exercise corporate trust powers,
                 having a combined capital and surplus of at least 50 million
                 U.S. dollars ($50,000,000), and subject to supervision or
                 examination by federal, state, territorial or District of
                 Columbia authority.  If such corporation publishes reports of
                 condition at least annually, pursuant to law or to the
                 requirements of the supervising or examining authority
                 referred to above, then for the purposes of this Section 5.3
                 (a) (ii), the combined capital and surplus of such corporation
                 shall be deemed to be its combined capital and surplus asset
                 forth in its most recent report of condition so published.

      (b)  If at any time the Property Trustee shall cease to be eligible to so
           act under Section 5.3(a), the Property Trustee shall immediately
           resign in the manner and with the effect set out in Section 5.6(c).

      (c)  If the Property Trustee has or shall acquire any "conflicting
           interest" within the meaning of Section  310(b) of the Trust
           Indenture Act, the Property Trustee and the Holder of the Common
           Securities (as if it were the obligor referred to in Section  310(b)
           of the Trust Indenture Act) shall in all respects comply with the
           provisions of Section  310(b) of the Trust Indenture Act.


                                     28


<PAGE>   34


      (d)  The Preferred Securities Guarantee shall be deemed to be
           specifically described in this Declaration for purposes of clause
           (i) of the first provision contained in Section 310(b) of the Trust
           Indenture Act.

SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally.

Each Regular Trustee and the Delaware Trustee (unless the Property Trustee also
acts as Delaware Trustee) shall be either a natural person who is at least 21
years of age or a legal entity which shall act through one or more Authorized
Officers.

SECTION 5.5 Initial Trustees.

The initial Regular Trustees shall be:

Dennis J. Mickey
2700 Sanders Road
Prospect Heights, Illinois  60070

and

Benjamin B. Moss, Jr.
2700 Sanders Road
Prospect Heights, Illinois  60070

The initial Delaware Trustee and the initial Property Trustee shall be:

Wilmington Trust Company, a Delaware banking corporation.
Rodney Square North
1100 North Market Street
Wilmington, Delaware  19890


SECTION 5.6 Appointment, Removal and Resignation of Trustees.

      (a)  Subject to Section 5.6(b) Trustees may be appointed or removed
           without cause at any time:

            (i)  until the issuance of any Securities, by written instrument
                 executed by the Sponsor; and

            (ii) after the issuance of any Securities;

                 (A)   other than in respect to a Special Regular Trustee, by
                       vote of the Holders of a Majority in liquidation amount
                       of the Common Securities voting as a class at a meeting
                       of the Holders of the Common Securities; and


                                     29


<PAGE>   35
                  (B)  if an Appointment Event has occurred and is continuing,
                       one (1) additional Regular Trustee (the "Special Regular
                       Trustee") may be appointed by vote of the Holders of a
                       Majority in liquidation amount of the Preferred
                       Securities, voting as a class at a meeting of the Holders
                       of the Preferred Securities and such Special Regular
                       Trustee may only be removed (otherwise than by the
                       operation of Section 5.6(c)), by vote of the Holders of a
                       Majority in liquidation amount of the Preferred
                       Securities voting as a class at a meeting of the Holders
                       of the Preferred Securities.

      (b)  (i) The Trustee that acts as Property Trustee shall not be removed
           in accordance with Section 5.6(a) until Successor Property Trustee
           has been appointed and has accepted such appointment by written
           instrument executed by such Successor Property Trustee and delivered
           to the Regular Trustees and the Sponsor; and

           (ii) the Trustee that acts as Delaware Trustee shall not be removed
           in accordance with this Section 5.6(a) until a successor Trustee
           possessing the qualifications to act as Delaware Trustee under
           Sections 5.2 and 5.4 (a "Successor Delaware Trustee") has been
           appointed and has accepted such appointment by written instrument
           executed by such Successor Delaware Trustee and delivered to the
           Regular Trustees and the Sponsor.

      (c)  A Trustee appointed to office shall hold office until his successor
           shall have been appointed or until his death, removal or
           resignation, provided that a Special Regular Trustee shall only hold
           office while an Appointment Event is continuing and shall cease to
           hold office immediately after the Appointment Event pursuant to which
           the Special Regular Trustee was appointed and all other Appointment
           Events cease to be continuing. Any Trustee may resign from office
           (without need for prior or subsequent accounting) by an instrument in
           writing signed by the Trustee and delivered to the Sponsor and the
           Trust, which resignation shall take effect upon such delivery or upon
           such later date as is specified therein; provided,  however, that:

           (i)  no such resignation of the Trustee that acts as the Property
           Trustee shall be effective until either:



                                     30


<PAGE>   36


                  (A)  a Successor Property Trustee has been appointed and has
                       accepted such appointment by instrument executed by such
                       Successor Property Trustee and delivered to the Trust,
                       the Sponsor and the resigning Property Trustee; or

                  (B)  the assets of the Trust have been completely liquidated
                       and the proceeds thereof distributed to the holders of
                       the Securities; and

            (ii) no such resignation of the Trustee that acts as the Delaware
                 Trustee shall be effective until a Successor Delaware Trustee
                 has been appointed and has accepted such appointment by
                 instrument executed by such Successor Delaware Trustee and
                 delivered to the Trust, the Sponsor and the resigning Delaware
                 Trustee; and

           (iii) no such resignation of a Special Regular Trustee shall be
                 effective until the 60th day following delivery of the
                 instrument of resignation of the Special Regular Trustee to
                 the Sponsor and the Trust or such later date specified in such
                 instrument during which period the Holders of the Preferred
                 Securities shall have the right to appoint a successor Special
                 Trustee as provided in this Section 5.6.

      (d)  If no Successor Property Trustee or Successor Delaware Trustee shall
           have been appointed and accepted appointment as provided in this
           Section 5.6 within 60 days after delivery to the Sponsor and the
           Trust of an instrument of resignation, the resigning Property
           Trustee or Delaware Trustee may petition any court of competent
           jurisdiction for appointment of a Successor Property Trustee or
           Successor Delaware Trustee. Such court may thereupon after such
           notice, if any, as it may deem proper and prescribe, appoint a
           Successor Property Trustee or Successor Delaware Trustee, as the
           case may be.

SECTION 5.7 Vacancies Among Trustees.

     If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees
is increased pursuant to Section 5.1, a vacancy shall occur.  A resolution
certifying the existence of such vacancy by a majority of the Regular Trustees
shall be conclusive evidence of the existence of such vacancy. The vacancy
shall be filled with a Trustee appointed in accordance with Section 5.6.



                                     31


<PAGE>   37


SECTION 5.8 Effect of Vacancies.

     The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee, or
any one of them, shall not operate to annul the Trust. Whenever a vacancy in
the number of Regular Trustees shall occur, until such vacancy is filled by the
appointment of a Regular Trustee in accordance with Section 5.6, the Regular
Trustees in office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the duties imposed upon
the Regular Trustees by this Declaration.

SECTION 5.9 Meetings.

     Meetings of the Regular Trustees shall be held from time to time upon the
call of any Regular Trustee.  Regular meetings of the Regular Trustees may be
held at a time and place fixed by resolution of the Regular Trustees.  Notice
of any in-person meetings of the Regular Trustees shall be hand delivered or
otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 48 hours before such meeting. Notice of any
telephonic meetings of the Regular Trustees or any committee thereof shall be
hand delivered or otherwise delivered in writing (including by facsimile, with
a hard copy by overnight courier) not less than 24 hours before a meeting.
Notices shall contain a brief statement of the time, place and anticipated
purposes of the meeting. The presence (whether in person or by telephone) of a
Regular Trustee at a meeting shall constitute a waiver of notice of such
meeting except where a Regular Trustee attends a meeting for the express
purpose of objecting to the transaction of any activity on the ground that the
meeting has not been lawfully called or convened. Unless provided otherwise in
this Declaration, any action of the Regular Trustees may be taken at a meeting
by vote of a majority of the Regular Trustees present (whether in person or by
telephone) and eligible vote with respect to such matter, provided that a
quorum is present, or without a meeting by the unanimous written consent of the
Regular Trustees.

SECTION 5.10 Delegation of Power.

      (a)  Any Regular Trustee may, by power of attorney consistent with
           applicable law, delegate to any other natural person over the age of
           21 his or her power for the purpose of executing any documents
           contemplated in Section 3.6 including any registration statement or
           amendment thereto filed with the Commission or making any other
           governmental filing; and

      (b)  the Regular Trustees shall have power to delegate from time to time
           to such of their number or to officers of the Trust the doing of
           such things and the execution of such instruments either in the name
           of the Trust or the


                                     32



<PAGE>   38


           names of the Regular Trustees or otherwise as the Regular Trustees
           may deem expedient, to the extent such delegation is not prohibited
           by applicable law or contrary to the provisions of the Trust, as
           set forth herein.


                                   ARTICLE VI

                                 DISTRIBUTIONS

SECTION 6.1 Distributions.

Holders shall receive Distributions in accordance with the applicable terms of
the relevant Holder's Securities. Distributions shall be made on the Preferred
Securities and the Common Securities in accordance with the preferences set
forth in their respective terms. If and to the extent that the Debt Issuer
makes a payment of interest (including Compounded Interest (as defined in the
Indenture)), premium and principal on the Notes held by the Property Trustee
(the amount of any such payment being a "Payment Amount"), the Property Trustee
shall and is directed, to the extent funds are available for that purpose, to
make a Distribution of the Payment Amount to Holders.


                                  ARTICLE VII

                           ISSUANCE OF SECURITIES

SECTION 7.1 General Provisions Regarding Securities.

      (a)  The Regular Trustees shall, on behalf of the Trust, issue one class
           of preferred securities representing undivided beneficial interests
           in the assets of the Trust having such terms as are set forth in
           Exhibit A and incorporated herein by reference (the "Preferred
           Securities"), and one class of common securities representing
           undivided beneficial interests in the assets of the Trust having
           such terms as are set forth in Exhibit A and incorporated herein by
           reference (the "Common Securities"). The Trust shall have no
           securities or other interests in the assets of the Trust other than
           the Preferred Securities and the Common Securities.

      (b)  The Certificates shall be signed on behalf of the Trust by the
           Regular Trustees (or if there are more than two Regular Trustees by
           any two of the Regular Trustees). Such signatures may be the manual
           or facsimile signatures of the present or any future Regular
           Trustee. Typographical and other minor errors or defects in any such
           reproduction of any such signature shall not affect



                                     33


<PAGE>   39

           the validity of any Certificate. In case any Regular Trustee of the
           Trust who shall have signed any of the Certificates shall cease to
           be such Regular Trustee before the Certificate so signed shall be
           delivered by the Trust, such Certificate nevertheless may be
           delivered as though the person who signed such Certificate had not
           ceased to be such Regular Trustee; and any Certificate may be signed
           on behalf of the Trust by such persons who shall at the actual date
           of execution of such Security, shall be the Regular Trustees of the
           Trust, although at the date of the execution and delivery of the
           Declaration any such person was not such a Regular Trustee.
           Certificates shall be printed, lithographed or engraved or may be
           produced in any other manner as is reasonably acceptable to the
           Regular Trustees, as evidenced by their execution thereof, and may
           have such letters, numbers or other marks of identification or
           designation and such legends or endorsements as the Regular Trustees
           may deem appropriate, or as may be required to comply with any law
           or with any rule or regulation of any stock exchange on which
           Securities may be listed, or to conform to usage.

      (c)  The consideration received by the Trust for the issuance of the
           Securities shall constitute a contribution to the capital of the
           Trust and shall not constitute a loan to the Trust.

      (d)  Upon issuance of the Securities as provided in this Declaration, the
           Securities so issued shall be deemed to be validly issued, fully
           paid and nonassessable.

      (e)  Every Person, by virtue of having become a Holder or a Preferred
           Security Beneficial Owner in accordance with the terms of this
           Declaration, shall be deemed to have expressly assented and agreed
           to the terms of, and shall be bound by this Declaration.


                                  ARTICLE VIII

                              TERMINATION OF TRUST

SECTION 8.1 Termination of Trust.


      (a)  The Trust shall dissolve;

           (i)  upon the bankruptcy of the Holder of the Common Securities,
                the Sponsor or the Debt Issuer;

           (ii) upon the filing of a certificate of dissolution or its
                equivalent with respect to the Holder of the Common Securities,
                the Sponsor or the Debt Issuer,

                                     34


<PAGE>   40


                the filing of a certificate of cancellation with respect to the
                Trust or the revocation of the Holder of the Common Securities,
                the Sponsor's or the Debt Issuer's charter and the expiration
                of 90 days after the date of revocation without a reinstatement
                thereof;

        (iii)   upon the entry of a decree of judicial dissolution of the
                Holder of the Common Securities, the Sponsor, the Debt Issuer or
                the Trust;

         (iv)   when all of the Securities shall have been called for
                redemption and the amounts necessary for redemption thereof
                shall have been paid to the Holders in accordance with the
                terms of the Securities;

          (v)   upon the occurrence and continuation of a Special Event
                pursuant to which the Trust shall have been dissolved in
                accordance with the terms of the Securities and all of the
                Notes endorsed thereon shall have been distributed to the
                Holders of Securities in exchange for all of the Securities; or

         (vi)   before the issuance of any Securities, with the consent of all
                of the Regular Trustees and the Sponsor.

      (b)  As soon as is practicable after the occurrence of an event referred
           to in Section 8.1 (a), the Trustees shall, after paying or making
           reasonable provision for payment of the liabilities of the Trust,
           file a certificate of cancellation with the Secretary of State of
           the State of Delaware and the Trust shall terminate.

      (c)  The provisions of Section 3.9 and Article X shall survive the
           termination of the Trust.


                                 ARTICLE IX

                             TRANSFER OF INTERESTS

SECTION 9.1 Transfer of Securities.

      (a)  Securities may only be transferred, in whole or in part, in
           accordance with the terms and conditions set forth in this
           Declaration and in the terms of the Securities. Any transfer or
           purported transfer of any Security not made in accordance with this
           Declaration shall be null and void.


                                     35


<PAGE>   41


      (b)  Subject to this Article IX, Preferred Securities shall be freely
           transferable.

      (c)  Subject to this Article IX, the Sponsor and any Related Party may
           only transfer Common Securities to the Sponsor or a Related Party of
           the Sponsor, provided, that, any such transfer is subject to the
           condition precedent that the transferor obtain the written opinion
           of nationally recognized independent counsel experienced in such
           matters that such transfer would not cause more than an
           insubstantial risk that:

            (i)  the Trust would be classified for United States federal income
                 tax purposes as an association taxable as a corporation or a
                 partnership and each Holder of Securities would not be treated
                 as owning an undivided beneficial interest in the Notes; and

            (ii) the Trust would be an Investment Company, or would be
                 controlled by an Investment Company.

SECTION 9.2 Transfer of Certificates.

The Regular Trustees shall provide for the registration of Certificates and of
transfers of Certificates, which will be effected without charge but only upon
payment (with such indemnity as the Regular Trustees may require) in respect of
any tax or other government charges which may be imposed in relation to it.
Upon surrender for registration of transfer of any Certificate, the Regular
Trustees shall cause one or more new Certificates to be issued in the name of
the designated transferee or transferees. Every Certificate surrendered for
registration of transfer shall be accompanied by a written instrument of
transfer in form satisfactory to the Regular Trustees duly executed by the
Holder or such Holder's attorney duly authorized in writing. Each Certificate
surrendered for registration of transfer shall be canceled by the Regular
Trustees. A transferee of a Certificate shall be entitled to the rights and
subject to the obligations of a Holder hereunder upon the receipt by such
transferee of a Certificate. By acceptance of a Certificate, each transferee
shall be deemed to have agreed to be bound by this Declaration and the
documents incorporated by reference herein.

SECTION 9.3 Deemed Security Holders.

The Trustees may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole holder of such
Certificate and of the Securities represented by such Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on


                                     36

<PAGE>   42

the part of any Person, whether or not the Trustees shall have  actual or other
notice thereof.

SECTION 9.4 Book Entry Interests.

Unless otherwise specified in the terms of the Preferred Securities, the
Preferred Securities Certificates, on original issuance, will be issued in the
form of one or more, fully registered, global Preferred Security Certificates
(each a "Global Certificate"), to be delivered to DTC, the initial Clearing
Agency, by, or on behalf of, the Trust.  Such Global Certificates shall
initially be registered on the books and records of the Trust in the name of
Cede & Co., the nominee of DTC, and no Preferred Security Beneficial Owner will
receive a definitive Preferred Security Certificate representing such Preferred
Security Beneficial Owner's interests in such Global Certificates, except as
provided in Section 9.7. Unless and until definitive, fully registered Preferred
Security Certificates (the "Definitive Preferred Security Certificates") have
been issued to the Preferred Security Beneficial Owners pursuant to Section 9.7:

      (a)  the provisions of this Section 9.4 shall be in full force and effect;

      (b)  the Trust and the Trustees shall be entitled to deal with the
           Clearing Agency for all purposes of this Declaration (including the
           payment of Distributions on the Global Certificates and receiving
           approvals, votes or consents hereunder) as the Holder of the
           Preferred Securities and the sole holder of the Global Certificates
           and shall have no obligation to the Preferred Security Beneficial
           Owners;

      (c)  to the extent that the provisions of this Section 9.4 conflict with
           any other provisions of this Declaration, the provisions of this
           Section 9.4 shall control; and

      (d)  the rights of the Preferred Security Beneficial Owners shall be
           exercised only through the Clearing Agency and shall be limited to
           those established by law and agreements between such Preferred
           Security Beneficial Owners and the Clearing Agency and/or the
           Clearing Agency Participants. DTC will make book entry transfers
           among the Clearing Agency Participants and receive and transmit
           payments of Distributions on the Global Certificates to such
           Clearing Agency Participants.

SECTION 9.5 Notices to Clearing Agency.

Whenever a notice or other communication to the Preferred Security Holders is
required under this Declaration, unless and until Definitive Preferred Security
Certificates shall have been issued


                                     37


<PAGE>   43

to the Preferred Security Beneficial Owners pursuant to Section 9.7, the
Regular Trustees shall give all such notices and communications specified herein
to be given to the Preferred Security Holders to the Clearing Agency, and shall
have no notice obligations to the Preferred Security Beneficial Owners.

SECTION 9.6 Appointment of Successor Clearing Agency.

If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Preferred Securities, the Regular Trustees may,
in their sole discretion, appoint a successor Clearing Agency with respect to
such Preferred Securities.

SECTION 9.7  Definitive Preferred Security Certificates.

      If:

      (a)  a Clearing Agency elects to discontinue its services as securities
           depositary with respect to the Preferred Securities and a successor
           Clearing Agency is not appointed within 90 days after such
           discontinuance pursuant to Section 9.6; or

      (b)  the Regular Trustees elect after consultation with the Sponsor to
           terminate the book entry system through the Clearing Agency with
           respect to the Preferred Securities, then:

      (c)  Definitive Preferred Security Certificates shall be prepared by the
           Regular Trustees on behalf of the Trust with respect to such
           Preferred Securities; and

      (d)  upon surrender of the Global Certificates by the Clearing Agency,
           accompanied by registration instructions, the Regular Trustees shall
           cause Definitive Certificates to be delivered to Preferred Security
           Beneficial Owners in accordance with the instructions of the
           Clearing Agency. Neither the Trustees nor the Trust shall be liable
           for any delay in delivery of such instructions and each of them may
           conclusively rely on and shall be protected in relying on, such
           instructions. The Definitive Preferred Security Certificates shall be
           printed, lithographed or engraved or may be produced in any other
           manner as is reasonably acceptable to the Regular Trustees, as
           evidenced by their execution thereof, and may have such letters,
           numbers or other marks of identification or designation and such
           legends or endorsements as the Regular Trustees may deem appropriate,
           or as may be required to comply with any law or with any rule or
           regulation made pursuant thereto or with any rule or regulation of
           any stock exchange on which Preferred Securities may be listed, or to
           conform to usage.


                                     38


<PAGE>   44

SECTION 9.8  Mutilated, Destroyed, Lost or Stolen Certificates.

      If:

      (a)  any mutilated Certificates should be surrendered to the Regular
           Trustees, or if the Regular Trustees shall receive evidence to their
           satisfaction of the destruction, loss or theft of any Certificate;
           and

      (b)  there shall be delivered to the Regular Trustees such security or
           indemnity as may be required by them to keep each of them harmless,

      then in the absence of notice that such Certificate shall have been
      acquired by a bona fide purchaser, any two Regular Trustees on behalf of
      the Trust shall execute and deliver, in exchange for or in lieu of any
      such mutilated, destroyed, lost or stolen Certificate, a new Certificate
      of like denomination. In connection with the issuance of any new
      Certificate under this Section 9.8, the Regular Trustees may require the
      payment of a sum sufficient to cover any tax or other governmental charge
      that may be imposed in connection therewith. Any duplicate Certificate
      issued pursuant to this Section shall constitute conclusive evidence of an
      ownership interest in the relevant Securities, as if originally is sued,
      whether or not the lost, stolen or destroyed Certificate shall be found at
      any time.


                                  ARTICLE X

                           LIMITATION OF LIABILITY OF
                   HOLDERS OF SECURITIES, TRUSTEES OR OTHERS

SECTION 10.1 Liability.

      (a)  Except as expressly set forth in this Declaration, the Securities
           Guarantees and the terms of the Securities, the Sponsor shall not be:

            (i)  personally liable for the return of any portion of the capital
                 contributions (or any return thereon) of the Holders of the
                 Securities which shall be made solely from assets of the
                 Trust; and

            (ii) required to pay to the Trust or to any Holder of Securities
                 any deficit upon dissolution of the Trust or otherwise.


                                     39


<PAGE>   45


      (b)  The Holder of the Common Securities shall be liable for all of the
           debts and obligations of the Trust (other than with respect to the
           Securities) to the extent not satisfied out of the Trust's assets.

      (c)  Pursuant to Section 3803(a) of the Business Trust Act, the Holders
           of the Preferred Securities shall be entitled to the same limitation
           of personal liability extended to stockholders of private
           corporations for profit organized under the General Corporation Law
           of the State of Delaware.

SECTION 10.2 Exculpation.

      (a)  No Indemnified Person shall be liable, responsible or accountable
           in damages or otherwise to the Trust or any Covered Person for any
           loss, damage or claim incurred by reason of any act or omission
           performed or omitted by such Indemnified Person in good faith on
           behalf of the Trust and in a manner such Indemnified Person
           reasonably believed to be within the scope of the authority conferred
           on such Indemnified Person by this Declaration or by law, except that
           an Indemnified Person shall be liable for any such loss, damage or
           claim incurred by reason of such Indemnified Person's gross
           negligence (or, in the case of the Property Trustee, negligence) or
           willful misconduct with respect to such acts or omissions.

      (b)  An Indemnified Person shall be fully protected in relying in good
           faith upon the records of the Trust and upon such information,
           opinions, reports or statements presented to the Trust by any Person
           as to matters the Indemnified Person reasonably believes are within
           such other Person's professional or expert competence and who has
           been selected with reasonable care by or on behalf of the Trust,
           including information, opinions, reports or statements as to the
           value and amount of the assets, liabilities, profits, losses, or any
           other facts pertinent to the existence and amount of assets from
           which Distributions to Holders of Securities might properly be paid.

SECTION 10.3 Fiduciary Duty.

      (a)  To the extent that, at law or in equity, an Indemnified Person has
           duties (including fiduciary duties) and liabilities relating thereto
           to the Trust or to any other Covered Person, an Indemnified Person
           acting under this Declaration, subject to any duties or obligations
           imposed on the Property Trustee under the Trust Indenture Act and


                                     40


<PAGE>   46


           Rule 3a-7, shall not be liable to the Trust or to any other Covered
           Person for its good faith reliance on the provisions of this
           Declaration. The provisions of this Declaration, to the extent that
           they restrict the duties and liabilities of an Indemnified Person
           otherwise existing at law or in equity (other than duties imposed
           on the Property Trustee under the Trust Indenture Act), are agreed
           by the parties hereto to replace such other duties and liabilities
           of such Indemnified Person.

      (b)  Unless otherwise expressly provided here in:

            (i)  whenever a conflict of interest exists or arises between an
                 Indemnified Person and any Covered Persons; or

            (ii) whenever this Declaration or any other agreement contemplated
                 herein or therein provide that an Indemnified Person shall act
                 in a manner that is, or provides terms that are, fair and
                 reasonable to the Trust or any Holder of Securities,

      the Indemnified Person shall resolve such conflict of interest, take such
      action or provide such terms, considering in each case the relative
      interest of each party (including its own interest) to such conflict,
      agreement, transaction or situation and the benefits and burdens relating
      to such interests, any customary or accepted industry practices, and any
      applicable generally accepted accounting practices or principles. In the
      absence of bad faith by the Indemnified Person, the resolution, action or
      term so made, taken or provided by the Indemnified Person shall not
      constitute a breach of this Declaration or any other agreement
      contemplated herein or of any duty or obligation of the Indemnified Person
      at law or in equity or otherwise.

      (c)  Whenever in this Declaration an Indemnified Person is permitted or
           required to make a decision:

            (i)  in its "discretion" or under a grant of similar authority, the
                 Indemnified Person shall be entitled to consider such
                 interests and factors as it desires, including its own
                 interests, and shall have no duty or obligation to give any
                 consideration to any interest of or factors affecting the Trust
                 or any other Person; or

            (ii) in its "good faith" or under another express standard,


                                     41


<PAGE>   47


                 the Indemnified Person shall act under such express standard
                 and shall not be subject to any other or different
                 standard imposed by this Declaration or by applicable law.


SECTION 10.4 Indemnification.

      (a)  To the fullest extent permitted by applicable law, the Sponsor
           shall indemnify and hold harmless each Indemnified Person from and
           against any loss, damage or claim incurred by such Indemnified
           Person by reason of any act or omission performed or omitted by such
           Indemnified Person in good faith on behalf of the Trust and in a
           manner such Indemnified Person reasonably believed to be within the
           scope of authority conferred on such Indemnified Person by this
           Declaration, except that no Indemnified Person shall be entitled to
           be indemnified in respect of any loss, damage or claim incurred by
           such Indemnified Person by reason of gross negligence (or, in the
           case of the Property Trustee, negligence) or willful misconduct with
           respect to such acts or omissions.

      (b)  To the fullest extent permitted by applicable law, expenses
           (including legal fees) incurred by an Indemnified Person in
           defending any claim, demand, action, suit or proceeding shall, from
           time to time, be advanced by the Sponsor prior to the final
           disposition of such claim, demand, action, suit or proceeding upon
           receipt by the Sponsor of an undertaking by or on behalf of the
           Indemnified Person to repay such amount if it shall be determined
           that the Indemnified Person is not entitled to be indemnified as
           authorized in Section 10.4(a).

SECTION 10.5 Outside Businesses.

Any Covered Person, the Sponsor, the Debt Issuer, the Delaware Trustee and the
Property Trustee may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such
independent ventures or the income or profits derived therefrom and the pursuit
of any such venture, even if competitive with the business of the Trust, shall
not be deemed wrongful or improper. No Covered Person, the Sponsor, the Debt
Issuer, the Delaware Trustee, or the Property Trustee shall be obligated to
present any particular investment or other opportunity to the Trust  even if
such opportunity is of a character that, if presented to the Trust, could be
taken by the Trust, and any Covered Person, the Sponsor, the Debt Issuer, the
Delaware Trustee and the Property Trustee shall have the right to take for its
own account (individually or


                                     42


<PAGE>   48


as a partner or fiduciary) or to recommend to others any such particular
investment or other opportunity. Any Covered Person, the Delaware Trustee and
the Property Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as
depository for, trustee or agent for, or act on any committee or body of holders
of, securities or other obligations of the Sponsor or its Affiliates.


                                   ARTICLE XI

                                   ACCOUNTING

SECTION 11.1 Fiscal Year.

The fiscal year ("Fiscal Year") of the Trust shall be the calendar year, or
such other year as is required by the Code.

SECTION 11.2 Certain Accounting Matters.

      (a)  At all times during the existence of the Trust, the Regular Trustees
           shall keep, or cause to be kept, full books of account, records and
           supporting documents, which shall reflect in reasonable detail, each
           transaction of the Trust. The books of account shall be maintained on
           the accrual method of accounting, in accordance with generally
           accepted accounting principles, consistently applied. The Trust shall
           use the accrual method of accounting for United States federal income
           tax purposes. The books of account and the records of the Trust shall
           be examined by and reported upon as of the end of each Fiscal Year by
           a firm of independent certified public accountants selected by the
           Regular Trustees.

      (b)  The Regular Trustees shall cause to be prepared and delivered to
           each of the Holders of Securities, within 90 days after the end of
           each Fiscal Year of the Trust, annual financial statements of the
           Trust, including a balance sheet of the Trust as of the end of such
           Fiscal Year, and the related statements of income or loss.

      (c)  The Regular Trustees shall cause to be duly prepared and delivered
           to each of the Holders of Securities, any annual United States
           federal income tax information statement, required by the Code,
           containing such information with regard to the Securities held by
           each Holder as is required by the Code and the Treasury Regulations.
           Notwithstanding any right under the Code to deliver any such
           statement at a later date, the Regular Trustees shall endeavor to
           deliver all such statements within 30 days after the end of each
           Fiscal Year of the Trust.



                                     43


<PAGE>   49


            (d) The Regular Trustees shall cause to be duly prepared and filed
            with the appropriate taxing authority, an annual United States
            federal income tax return, on a Form 1041 or such other form
            required by United States federal income tax law, and any other
            annual income tax returns required to be filed by the Regular
            Trustees on behalf of the Trust with any state or local taxing
            authority.

SECTION 11.3 Banking.

The Trust shall maintain one or more bank accounts in the name and for the sole
benefit of the Trust; provided, however, that all payments of funds in respect
of the Notes held by the Property Trustee shall be made directly to the Property
Account and no other funds of the Trust shall be deposited in the Property
Account. The sole signatories for such accounts shall be designated by the
Regular Trustees; provided, however, that the Property Trustee shall designate
the sole signatories for the Property Account.

SECTION 11.4 Withholding.

The Trust and the Trustees shall comply with all withholding requirements under
United States federal, state and local law. The Trust shall request, and the
Holders shall provide to the Trust, such forms or certificates as are necessary
to establish an exemption from withholding with respect to each Holder, and any
representations and forms as shall reasonably be requested by the Trust to
assist it in determining the extent of, and in fulfilling, its withholding
obligations. The Trust shall file required forms with applicable jurisdictions
and, unless an exemption from withholding is properly established by a Holder,
shall remit amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Trust is required to withhold and pay over
any amounts to any authority with respect to distributions or allocations to any
Holder, the amount withheld shall be deemed to be a distribution in the amount
of the withholding to the Holder. In the event of any claimed over withholding,
Holders shall be limited to an action against the applicable jurisdiction. If
the amount withheld was not withheld from actual Distributions made, the Trust
may reduce subsequent Distributions by the amount of such withholding.


                                  ARTICLE XII

                            AMENDMENTS AND MEETINGS

SECTION 12.1 Amendments.

      (a)  Except as otherwise provided in this Declaration or by any
           applicable terms of the Securities, this Declaration may be amended
           by, and only by, a written instrument



                                     44


<PAGE>   50

           approved and executed by the Regular Trustees (or, if there are more
           than two Regular Trustees a majority of the Regular Trustees);
           provided, however, that:

            (i)  no amendment shall be made, and any such purported amendment
                 shall be void and ineffective, to the extent the result
                 thereof would be to:

                  (A)  cause the Trust to be characterized for purposes of
                       United States federal income taxation as other than a
                       grantor trust;

                  (B)  reduce or otherwise adversely affect the rights, powers,
                       obligations or liabilities of the Property Trustee or
                       the Delaware Trustee without the written consent of the
                       affected trustee; or

                  (C)  cause the Trust to be deemed to be an Investment Company
                       which is required to be registered under the Investment
                       Company Act;

            (ii) at such time after the Trust has issued any Securities which
                 remain outstanding, any amendment which would  adversely affect
                 the rights, privileges or preferences of any Holder of
                 Securities may be effected only with such additional
                 requirements as may be set forth in the terms of such
                 Securities;

           (iii) Section 9.1(c) and this Section 12.1 shall not be amended
                 without the consent of all of the Holders of the Securities;

            (iv) Article IV shall not be amended without the consent of the
                 Holders of a Majority in liquidation amount of the Common
                 Securities; and

            (v)  the rights of the holders of the Common Securities under
                 Article V to increase or decrease the number of, and appoint
                 and remove Trustees shall not be amended without the consent
                 of the Holders of a Majority in liquidation amount of the
                 Common Securities.

      (b)  Notwithstanding Section 12.1(a)(ii), this Declaration may be amended
           without the consent of the Holders of the Securities to:

            (i)  cure any ambiguity;



                                     45



<PAGE>   51


            (ii) correct or supplement any provision in this Declaration that
                 may be defective or inconsistent with any other provision of
                 this Declaration;

           (iii) to add to the covenants, restrictions or obligations of the
                 Sponsor; and

            (iv) to conform to any change in Rule 3a-5 or written change in
                 interpretation or application of Rule 3a-5 by any legislative
                 body, court, government agency or regulatory authority which
                 amendment does not have a material adverse effect on the
                 right, preferences or privileges of the Holders.

SECTION 12.2  Meetings of the Holders of Securities; Action by Written Consent.

      (a)  Meetings of the Holders of any class of Securities may be called at
           any time by the Regular Trustees (or as provided in the terms of the
           Securities) to consider and act on any matter on which Holders of
           such class of Securities are entitled to act under the terms of this
           Declaration, the terms of the Securities or the rules of any stock
           exchange on which the Preferred Securities are listed or admitted for
           trading. The Regular Trustees shall call a meeting of such class of
           Holders, if directed to do so by the Holders of at least 10% in
           liquidation amount of such class of Securities. Such direction shall
           be given by delivering to the Regular Trustees one or more calls in a
           writing stating that the signing Holders of Securities wish to call a
           meeting and indicating the general or specific purpose for which the
           meeting is to be called. Any Holders of Securities calling a meeting
           shall specify in writing the Security Certificates held by the
           Holders of Securities exercising the right to call a meeting and only
           those specified shall be counted for purposes of determining whether
           the required percentage set forth in the second sentence of this
           paragraph has been met.

      (b)  Except to the extent otherwise provided in the terms of the
           Securities, the following provisions shall apply to meetings of
           Holders of Securities:

            (i)  notice of any such meeting shall be given to all the Holders
                 of Securities having a right to vote thereat at least 7 days
                 and not more than 60 days before the date of such meeting.
                 Whenever a vote, consent or approval of the Holders of
                 Securities is permitted or required under this Declaration or
                 the rules of any stock exchange on which the Preferred
                 Securities are listed or admitted for trading, such


                                     46


<PAGE>   52


                 vote, consent or approval may be given at a meeting of the
                 Holders of Securities. Any action that may be taken at a
                 meeting of the Holders of Securities may be taken without a
                 meeting if a consent in writing setting forth the action so
                 taken is signed by the Holders of Securities owning not less
                 than the minimum amount of Securities in liquidation amount
                 that would be necessary to authorize or take such action at a
                 meeting at which all Holders of Securities having a right to
                 vote thereon were present and voting. Prompt notice of the
                 taking of action without a meeting shall be given to the
                 Holders of Securities entitled to vote who have not consented
                 in writing. The Regular Trustees may specify that any written
                 ballot submitted to the Security Holder for the purpose of
                 taking any action without a meeting shall be returned to the
                 Trust within the time specified by the Regular Trustees;

            (ii) each Holder of a Security may authorize any Person to act for
                 it by proxy on all matters in which a Holder of Securities is
                 entitled to participate, including waiving notice of any
                 meeting, or voting or participating at a meeting. No proxy
                 shall be valid after the expiration of 11 months from the date
                 thereof unless otherwise provided in the proxy. Every proxy
                 shall be revocable at the pleasure of the Holder of Securities
                 executing it. Except as otherwise provided here in, all
                 matters relating to the giving, voting or validity of proxies
                 shall be governed by the General Corporation Law of the State
                 of Delaware relating to proxies, and judicial interpretations
                 thereunder, as if the Trust were a Delaware corporation and
                 the Holders of the Securities were stockholders of a Delaware
                 corporation;

           (iii) each meeting of the Holders of the Securities shall be
                 conducted by the Regular Trustees or by such other Person that
                 the Regular Trustees may designate; and

            (iv) unless the Business Trust Act, this Declaration, the terms of
                 the Securities or the listing rules of any stock exchange on
                 which the Preferred Securities are then listed or trading
                 otherwise provides, the Regular Trustees, in their sole
                 discretion, shall establish all other provisions relating to
                 meetings of Holders of Securities, including notice of the
                 time, place or purpose of any meeting at which any matter is
                 to be voted on

                                     47


<PAGE>   53


                 by any Holders of Securities, waiver of any such notice,
                 action by consent without a meeting, the establishment of a
                 record date, quorum requirements, voting in person or by proxy
                 or any other matter with respect to the exercise of any such
                 right to vote.


                                  ARTICLE XIII

                      REPRESENTATIONS OF PROPERTY TRUSTEE


SECTION 13.1  Representations and Warranties of Property Trustee.

The Trustee which acts as initial Property Trustee represents and warrants to
the Trust and to the Sponsor at the date of this Declaration, and each
Successor Property Trustee represents and warrants to the Trust and the Sponsor
at the time of the Successor Property Trustee's acceptance of its appointment as
Property Trustee that:

      (a)  The Property Trustee is a Delaware banking corporation with trust
           powers, duly organized, validly existing and in good standing under
           the laws of the State of Delaware, with trust power and authority to
           execute and deliver, and to carry out and perform its obligations
           under the terms of, the Declaration.

      (b)  The execution, delivery and performance by the Property Trustee of
           the Declaration has been duly authorized by all necessary corporate
           action on the part of the Property Trustee. The Declaration has been
           duly executed and delivered by the Property Trustee, and it
           constitutes a legal, valid and binding obligation of the Property
           Trustee, enforceable against it in accordance with its terms, subject
           to applicable bankruptcy, reorganization, moratorium, insolvency, and
           other similar laws affecting creditors' rights generally and to
           general principles of equity and the discretion of the court
           (regardless of whether the enforcement of such remedies is considered
           in a proceeding in equity or at law).

      (c)  The execution, delivery and performance of the Declaration by the
           Property Trustee does not conflict with or constitute a breach of
           the Certificate of Incorporation or By-laws of the Property Trustee.

      (d)  No consent, approval or authorization of, or registration with or
           notice to, any state or federal banking authority is required for
           the execution, delivery or performance by the Property Trustee, of
           the Declaration.


                                     48


<PAGE>   54


      (e)  The Property Trustee, pursuant to the Declaration, shall hold legal
           title and a valid ownership interest in the Notes under the law of
           its place of incorporation and Delaware law.


      (f)  The Delaware Trustee has been authorized to perform its obligations
           under the Certificate of Trust and the Declaration. The Declaration
           under Delaware law constitutes a legal, valid and binding
           obligation of the Delaware Trustee, enforceable against it in
           accordance with its terms, subject to applicable bankruptcy,
           reorganization, moratorium, insolvency, and other similar laws
           affecting creditors' rights generally and to general principles of
           equity and the discretion of the court (regardless of whether the
           enforcement of such remedies is considered in a proceeding in equity
           or at law).


                                  ARTICLE XIV

                                 MISCELLANEOUS

SECTION 14.1 Notices.

All notices provided for in this Declaration shall be in writing, duly signed
by the party giving such notice, and shall be delivered, telecopied or mailed
by registered or certified mail, as follows:

      (a)  if given to the Trust, in care of the Regular Trustees at the Trust's
           mailing address set forth below (or such other address as the Trust
           may give notice of to the Holders of the Securities):

           Household Capital Trust V
           2700 Sanders Road
           Prospect Heights, Illinois  60070
           Attention: Treasurer

      (b)  if given to the Property Trustee, at the mailing address set forth
           below (or such other address as the Property Trustee may give notice
           of to the Holders of the Securities):

           Wilmington Trust Company
           Rodney Square North
           1100 North Market Street
           Wilmington, Delaware  19890

           Attention: Corporate Trust Administration



                                     49


<PAGE>   55


      (c)  if given to the Holder of the Common Securities, at the mailing
           address of the Sponsor set forth below (or such other address as the
           Holder of the Common Securities may give notice to the Trust):


           Household International, Inc.
           2700 Sanders Road
           Prospect Heights, Illinois  60070

           Attention: Treasurer

      (d)  if given to any other Holder, at the address set forth on the books
           and records of the Trust.

All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed, or mailed by first class mail, postage
prepaid except that if a notice or other document is refused delivery or cannot
be delivered because of a changed address of which no notice was given, such
notice or other document shall be deemed to have been delivered on the date of
such refusal or inability to deliver.

SECTION 14.2 Governing Law.

This Declaration and the rights of the parties hereunder shall be governed by
and interpreted in accordance with the laws of the State of Delaware and all
rights and remedies shall be governed by such laws without regard to principles
of conflict of laws.

SECTION 14.3 Intention of the Parties.

It is the intention of the parties hereto that the Trust not be characterized
for United States federal income tax purposes as an association taxable as a
corporation or a partnership but rather, the Trust be characterized as a
grantor trust or otherwise in a manner that each Holder of Securities be
treated as owning an undivided beneficial interest in the Notes.  The provisions
of this undivided beneficial interest in the Notes.  The provisions of this
Declaration shall be interpreted to further this intention of the parties.

SECTION 14.4 Headings.

Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.


SECTION 14.5 Successors and Assigns

Whenever in this Declaration any of the parties hereto is named or



                                     50



<PAGE>   56

referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.


SECTION 14.6 Partial Enforceability.

If any provision of this Declaration, or the application of such provision to
any Person or circumstance, shall be held invalid, the remainder of this
Declaration, or the application of such provision to persons or circumstances
other than those to which it is held invalid, shall not be affected thereby.

SECTION 14.7 Counterparts.

This Declaration may contain more than one counterpart of the signature page
and this Declaration may be executed by the affixing of the signature of each
of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have
the same force and effect as though all of the signers had signed a single
signature page.



                                     51


<PAGE>   57



IN WITNESS WHEREOF, the undersigned has caused these presents to be executed as
of the day and year first above written.




                                     ------------------------------------
                                     Dennis J. Mickey,
                                     as Trustee



                                     ------------------------------------
                                     Benjamin B. Moss Jr.,
                                     as Trustee



                                     Wilmington Trust Company,
                                     as Trustee and as Property Trustee




                                     By:
                                        ------------------------------------
                                        Name:
                                        Title:



                                     Household International, Inc.,
                                     as Sponsor



                                     By:
                                        ------------------------------------
                                        Name:  John W. Blenke
                                        Title: Vice President-Corporate Law





                                     52


<PAGE>   58



                                   EXHIBIT A

                                    TERMS OF

                      _______% TRUST PREFERRED SECURITIES

                      _______% TRUST COMMON SECURITIES


Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust, dated
as of ________________, 2000 (as amended from time to time, the "Declaration"),
the designation, rights, privileges, restrictions, preferences and other terms
and provisions of the Preferred Securities and the Common Securities are set
out below (each capitalized term used but not defined herein has the meaning
set forth in the Declaration or, if not defined in such Declaration, as defined
in the Prospectus referred to below):

1. Designation and Number.

      (a)  Preferred Securities. Preferred Securities of the Trust with
           an aggregate liquidation amount with respect to the assets of the
           Trust of $______________ and a liquidation amount with respect
           to the assets of the Trust of $__ per Preferred Security, are hereby
           designated for the purposes of identification only as "____% Trust
           Preferred Securities" (the "Preferred Securities"). The Preferred
           Security Certificates evidencing the Preferred Securities shall be
           substantially in the form attached hereto as Annex I, with such
           changes and additions thereto or deletions therefrom as may be
           required by ordinary usage, custom or practice or to conform to the
           rules of any stock exchange on which the Preferred Securities are
           listed.

      (b)  Common Securities. Common Securities of the Trust with an
           aggregate liquidation amount with respect to the assets of the Trust
           of $__________________ and a liquidation amount with respect to the
           assets of the Trust of $__ per Common Security, are hereby
           designated for the purposes of identification only as "_____% Trust
           Common Securities" (the "Common Securities"). The Common Security
           Certificates evidencing the Common Securities shall be substantially
           in the form attached hereto as Annex II,

                                      1


<PAGE>   59


           with such changes and additions thereto or deletions there from
           as may be required by ordinary usage, custom or practice.

     2. Distributions.

      (a)  Distributions payable on each Security will be fixed at a
           rate per annum of _____% (the "Coupon Rate") of the stated
           liquidation amount of $__ per Security, such rate being the rate of
           interest payable on the Notes to be held by the Property Trustee.
           Distributions in arrears for more than one quarter will bear
           interest thereon, compounded quarterly at the Coupon Rate (to the
           extent permitted by applicable law). The term "Distributions" as
           used herein includes such cash distributions and any such interest
           payable unless otherwise stated. A Distribution is payable only to
           the extent that payments are made in respect of the Notes held by
           the Property Trustee. The amount of Distributions payable for any
           period will be computed (i) for any full 90-day quarterly
           Distribution period, on the basis of a 360-day year of twelve 30-day
           months and (ii) for any period shorter than a full 90-day quarterly
           Distribution period for which Distributions are computed, on the
           basis of a 30-day month, and for periods of less than a month, the
           actual number of days elapsed per 30-day month.

      (b)  Distributions on the Securities will be cumulative, will
           accrue from _______________, 2000 and will be payable quarterly in
           arrears, on ________, _______, ____________, and ___________ of each
           year, commencing on ____________, 2000, except as otherwise described
           below. The Debt Issuer has the right under the Indenture to defer
           payments of interest by extending the interest payment period from
           time to time on the Notes for a period not exceeding 20 consecutive
           quarters (each, an "Extension Period") and, as a consequence of such
           extension, Distributions will also be deferred.  No Extension Period
           will extend beyond the maturity date for the Notes. Despite such
           deferral, quarterly Distributions will continue to accrue with
           interest thereon (to the extent permitted by applicable law) at the
           Coupon Rate during any such Extension Period. Prior to the
           termination of any such Extension Period, the Debt Issuer may
           further extend such Extension Period; provided that such Extension
           Period together with all such previous and further extensions
           thereof may not exceed 20 consecutive quarters and provided further
           that no Extension Period may extend beyond the maturity date for the
           Notes. Payments of accrued Distributions will be payable to Holders
           as they appear on the books and records of the Trust on the first
           record date after the end of the


                                      2


<PAGE>   60


           Extension Period. Upon the termination of any Extension Period and
           the payment of all amounts then due, the Debt Issuer may commence a
           new Extension Period, subject to the above requirements.

      (c)  Distributions on the Securities will be payable to the Holders
           there of as they appear on the books and records of the Trust
           on the relevant record dates. While the Preferred Securities
           remain in book-entry only form, the relevant record dates shall be
           one Business Day prior to the relevant payment dates which payment
           dates  correspond to the interest payment dates on the Notes.
           Subject to any applicable laws and regulations and the provisions of
           the  Declaration, each such payment in respect of the Preferred
           Securities will be made as described under the heading "Description
           of the Preferred Securities -- Book-Entry Only Issuance - The
           Depository Trust Company" in the Prospectus dated ___________, (the
           "Prospectus"),  included in the Registration Statement on Form S-3
           of the Sponsor, the Debt Issuer and the Trust.  The relevant record
           dates for the Common Securities, and if the Preferred Securities
           shall not continue to remain in book-entry only form, the relevant
           record dates for the Preferred Securities, shall conform to the
           rules of any securities exchange on which the securities are listed
           and, if none, shall be selected by the Regular Trustees, which dates
           shall be at least one Business Day but less than 60 Business Days
           before the relevant payment dates which payment dates correspond to
           the interest payment dates on the Notes. Distributions payable on
           any Securities that are not punctually paid on any Distribution
           payment date as a result of the Debt Issuer or the Sponsor having
           failed to make a payment under the Notes, will cease to be payable
           to the Person in whose name such Securities are registered on the
           relevant record date, and such defaulted Distribution will instead
           be payable to the Person in whose name such Securities are
           registered on the special record date or other specified date
           determined in accordance with the Indenture. If any date on which
           Distributions are payable on the Securities is not a Business Day,
           then payment of the Distribution payable on such date will be made
           on the next succeeding day that is a Business Day (and without any
           interest or other payment in respect of any such delay) except that,
           if such Business Day is in the next succeeding calendar year, such
           payment shall be made on the immediately preceding Business Day, in
           each case with the same force and effect as if made on such date.

      (d)  In the event that there is any money or other property held by or
           for the Trust that is not accounted for


                                      3


<PAGE>   61


           hereunder, such property shall be distributed Pro Rata (as defined
           herein) among the Holders of the Securities.


      3.   Liquidation Distribution Upon Dissolution.

     In the event of any voluntary or involuntary dissolution, winding-up or
termination of the Trust, the Holders of the Securities on the date of the
dissolution, winding-up or termination as the case may be, will be entitled to
receive out of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of liabilities to creditors, an amount equal to
the aggregate of the stated liquidation amount of $__ per Security plus accrued
and unpaid Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"), unless, in connection with such dissolution,
winding-up or termination, Notes in an aggregate principal amount equal to the
aggregate stated liquidation amount of such Securities, with an interest rate
equal to the Coupon Rate of, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid Distributions on, such Securities, shall
be distributed on a Pro Rata basis to the Holders of the Securities in exchange
for such Securities.

     If, upon any such dissolution, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets available to pay in full
the aggregate Liquidation Distribution, then the amounts payable directly by
the Trust on the Securities shall be paid on a Pro Rata basis.

     4. Redemption and Distribution.

      (a)  Upon the repayment of the Notes in whole or in part, whether at
           maturity or upon redemption, the proceeds from such repayment or
           payment shall be simultaneously applied to redeem Securities having
           an aggregate liquidation amount equal to the aggregate principal
           amount of the Notes so repaid or redeemed at a redemption price of
           $25 per Security plus an amount equal to accrued and unpaid
           Distributions thereon at the date of the redemption, payable in cash
           (the "Redemption Price"). Holders will be given not less than 30 nor
           more than 60 days notice of such redemption.

      (b)  If fewer than all the outstanding Securities are to be so redeemed,
           the Common Securities and the Preferred Securities will be redeemed
           Pro Rata and the Preferred Securities to be redeemed will be as
           described in Section 4(f)(ii) below.

      (c)  If, at any time, a Tax Event or an Investment Company Event (each as
           defined below, and each a "Special Event")


                                      4


<PAGE>   62


           shall occur and be continuing, the Regular Trustees shall dissolve
           the Trust and, after satisfaction of creditors, cause Notes held by
           the Property Trustee, having an aggregate principal amount equal to
           the aggregate stated liquidation amount of, with an interest rate
           identical to the Coupon Rate of, and accrued and unpaid interest
           equal to accrued and unpaid Distributions on and having the same
           record date for payment as the Securities to be distributed to the
           Holders of the Securities in liquidation of such Holders' interests
           in the Trust on a Pro Rata basis, within 90 days following the
           occurrence of such Special Event (the "90 Day Period"), provided,
           however, that in the case of the occurrence of a Tax Event, as a
           condition of such dissolution and distribution, the Regular Trustees
           shall have received an opinion of a nationally recognized independent
           tax counsel experienced in such matters (a "No Recognition Opinion"),
           which opinion may rely on published revenue rulings of the Internal
           Revenue Service, to the effect that the Holders of the Securities
           will not recognize any gain or loss for United States federal income
           tax purposes as a result of the dissolution of the Trust and the
           distribution of Notes and provided, further, that, if at the time
           there is available to the Trust the opportunity to eliminate, within
           the 90 Day Period, the Special Event by taking some ministerial
           action, such as filing a form or making an election, or pursuing some
           other similar reasonable measure that has no adverse effect on the
           Trust, the Debt Issuer, the Sponsor or the Holders of the Securities
           ("Ministerial Action"), the Trust will pursue such Ministerial Action
           in lieu of dissolution.  In addition, if a Tax Event shall occur and
           be continuing, the Debt Issuer has the right to advance the maturity
           date of the Notes to the minimum extent required in order to permit
           payments of interest on the Notes to be deductible by the Debt Issuer
           for United States federal income tax purposes, but the resulting
           maturity may not be less than 15 years from the original issuance of
           the Notes.  The Debt Issuer may take such action only if nationally
           recognized independent tax counsel to the Debt Issuer experienced in
           such matters has delivered an opinion, which opinion may rely on
           published revenue rulings of the Internal Revenue Service, to the
           effect that (i) after advancing the maturity of the Notes, interest
           payments on the Notes will be deductible for United States federal
           income tax purposes and (ii) advancing the maturity date of the Notes
           will not result in a taxable event to holders of the Preferred
           Securities.

           If, in the case of the occurrence of a Tax Event (i) the Debt Issuer
           has received an opinion (a "Redemption Tax

                                      5


<PAGE>   63
           Opinion") of a nationally recognized independent tax counsel
           experienced in such matters that, as a result of a Tax Event, there
           is more than an insubstantial risk that the Debt Issuer would be
           precluded from deducting the interest on the Notes for United States
           federal income tax purposes even if the Notes were distributed to the
           Holders of Securities in liquidation of such Holders' interests in
           the Trust as described in this Section 4(c), or (ii) the Regular
           Trustees shall have been informed by such tax counsel that a No
           Recognition Opinion cannot be delivered to the Trust, the Debt Issuer
           shall have the right at any time, upon not less than 30 nor more than
           60 days notice, to redeem the Notes in whole or in part for cash
           within 90 days following the occurrence of such Tax Event, and
           following such redemption, Securities with an aggregate liquidation
           amount equal to the aggregate principal amount of the Notes so
           redeemed shall be redeemed by the Trust at the Redemption Price on a
           Pro Rata basis; provided, however, that, if at the time there is
           available to the Trust the opportunity to eliminate, within such 90
           day period, the Tax Event by taking some Ministerial Action, the
           Trust or the Debt Issuer will  pursue such Ministerial Action in lieu
           of redemption.

           "Tax Event" means that the Regular Trustees shall have received an
           opinion of a nationally recognized independent tax counsel
           experienced in such matters (a "Dissolution Tax Opinion") to the
           effect that on or after the date of the Prospectus, as a result of
           (a) any amendment to, or change (including any announced prospective
           change) in, the laws (or any regulations thereunder) of the United
           States or any political  subdivision or taxing authority therefore or
           therein, or (b) any amendment to, or change in, an interpretation or
           application of any such laws or regulations by any legislative body,
           court, governmental agency or regulatory authority, which amendment
           or change is enacted, promulgated, issued or announced or which
           interpretation or pronouncement is issued or announced or which
           action is taken, in each case on or after the date of the Prospectus,
           there is more than an insubstantial risk that (i) the Trust is or
           will be within 90 days of the date thereof, subject to United States
           federal income tax with respect to interest accrued or received on
           the Notes, (ii) the Trust is, or will be within 90 days of the date
           thereof, subject to more than a de minimis amount of taxes, duties or
           other governmental charges, or (iii) interest payable by the Debt
           Issuer to the Trust on the Notes is not, or within 90 days of the
           date thereof will not be, deductible, in whole or in part, by the
           Debt Issuer for United States federal income tax purposes.


                                      6
<PAGE>   64

           "Investment Company Event" means that the Regular Trustees shall
           have received an opinion of a nationally recognized independent
           counsel experienced in practice under the Investment Company Act
           that, as a result of the occurrence of a change in law or regulation
           or a written change in interpretation or application of law or
           regulation by any legislative body, court, governmental agency or
           regulatory authority (a "Change in 1940 Act Law"), the Trust is or
           will be considered an Investment Company which is required to be
           registered under the Investment Company Act, which Change in 1940 Act
           Law becomes effective on or after the date of the Prospectus
           Supplement.

           On and from the date fixed by the Regular Trustees for any
           distribution of Notes and dissolution of the Trust: (i) the
           Securities will no longer be deemed to be outstanding, (ii) The
           Depository Trust Company (the "Depository") or its nominee (or any
           successor Clearing Agency or its nominee), as the record Holder of
           the Preferred Securities, will receive a registered global
           certificate or certificates representing the Notes and the Note
           Guarantee to be delivered upon such distribution and any certificates
           representing Securities, except for certificates representing
           Preferred Securities held by the Depository or its nominee (or any
           successor Clearing Agency or its nominee), will be deemed to
           represent beneficial interests in the Notes having an aggregate
           principal amount equal to the aggregate stated liquidation amount of,
           with an interest rate identical to the Coupon Rate of, and accrued
           and unpaid interest equal co accrued and unpaid Distributions on such
           Securities until such certificates are presented to the Debt Issuer
           or its agent for transfer or reissue.

      (d)  The Trust may not redeem fewer than all the outstanding  Securities
           unless all accrued and unpaid Distributions have been paid on all
           Securities for all quarterly Distribution periods terminating on or
           before the date of redemption.

      (e)  If the Notes are distributed to holders of the Securities, pursuant
           to the terms of the Indenture, the Debt Issuer will use its best
           efforts to have the Notes listed on the New York Stock Exchange or
           on such other exchange as the Preferred Securities were listed
           immediately prior to the distribution of the Notes.

      (f)  "Redemption or Distribution Procedures."



                                      7
<PAGE>   65

             (i) Notice of any redemption of, or notice of distribution of
                 Notes in exchange for the Securities (a "Redemption/
                 Distribution Notice") will be given by the Trust by mail
                 to each Holder of Securities to be redeemed or exchanged not
                 fewer than 30 nor more than 60 days before the date fixed for
                 redemption or exchange thereof which, in the case of a
                 redemption, will be the date fixed for redemption of the
                 Notes. For purposes of the calculation of the date of
                 redemption or exchange and the dates on which notices are
                 given pursuant to this Section 4(f)(i), a Redemption/
                 Distribution Notice shall be deemed to be given on the day
                 such notice is first mailed by first-class mail, postage
                 prepaid, to Holders of Securities. Each Redemption/
                 Distribution Notice shall be addressed to the Holders of
                 Securities at the address of each such Holder appearing in the
                 books and records of the Trust. No defect in the Redemption/
                 Distribution Notice or in the mailing of either thereof with
                 respect to any Holder shall affect the validity of the
                 redemption or exchange proceedings with respect to any
                 other Holder.

            (ii) In the event that fewer than all the outstanding Securities
                 are to be redeemed, the Securities to be redeemed shall be
                 redeemed Pro Rata from each Holder of Securities, it being
                 understood that in respect of Preferred Securities registered
                 in the name of and held of record by DTC (or a successor
                 clearing agency) or any other Nominee, the distribution of the
                 proceeds of such redemption will be made to each Clearing
                 Agency Participant (or person on whose behalf such nominee
                 holds such securities) in accordance with the procedures
                 applied by such agency or nominee.

           (iii) If Securities are to be redeemed and the Trust gives a
                 Redemption/Distribution Notice which notice may only be issued
                 if the Notes are redeemed as set out in this Section 4 (which
                 notice will be irrevocable) then (A) while the Preferred
                 Securities are in book entry only form, with respect to the
                 Preferred Securities, by 12:00 noon, New York City time, on the
                 redemption date, provided that the Debt Issuer has paid the
                 Property Trustee a sufficient amount of cash in connection with
                 the related redemption or maturity of the Notes, the Property
                 Trustee will deposit irrevocably with the Depository (or
                 successor Clearing Agency) funds sufficient to pay the
                 applicable Redemption Price with respect to the


                                      8
<PAGE>   66

                 Preferred Securities and will give the Depository irrevocable
                 instructions and authority to pay the Redemption Price to the
                 Holders of the Preferred Securities, and (B) if the Preferred
                 Securities are issued in definitive form, with respect to the
                 Preferred Securities, and with respect to the Common
                 Securities, provided that the Debt Issuer has paid the Property
                 Trustee a sufficient amount of cash in connection with the
                 related redemption or maturity of the Notes, the Property
                 Trustee will pay the relevant Redemption Price to the Holders
                 of such Securities by check mailed to the address of the
                 relevant Holder appearing on the books and records of the Trust
                 on the redemption date. If a Redemption/Distribution Notice
                 shall have been given and funds deposited as required, if
                 applicable, then immediately prior to the close of business on
                 the date of such deposit, or on the redemption date, as
                 applicable, Distributions will cease to accrue on the
                 Securities so called for redemption and all rights of Holders
                 of such Securities so called for redemption will cease, except
                 the right of the Holders of such Securities to receive the
                 Redemption Price, but without interest on such Redemption
                 Price. Neither the Regular Trustees nor the Trust shall be
                 required to register or cause to be registered the transfer of
                 any Securities which have been so called for redemption. If any
                 date fixed for redemption of Securities is not a Business Day,
                 then payment of the Redemption Price payable on such date will
                 be made on the next succeeding day that is a Business Day (and
                 without any interest or other payment in respect of any such
                 delay) except that, if such Business Day falls in the next
                 calendar year, such payment will be made on the immediately
                 preceding Business Day, in each case with the same force and
                 effect as if made on such date fixed for redemption. If payment
                 of the Redemption Price in respect of Securities is improperly
                 withheld or refused and not paid either by the Property Trustee
                 or by the Sponsor as guarantor pursuant to the relevant
                 Securities Guarantee, Distributions on such Securities will
                 continue to accrue, from the original redemption date to the
                 actual date of payment, in which case the actual payment date
                 will be considered the date fixed for redemption for purposes
                 of calculating the Redemption Price.

            (iv) Redemption/Distribution Notices shall be sent by
                 the Regular Trustees on behalf of the Trust to (A) in respect
                 of the Preferred Securities, the


                                      9
<PAGE>   67


                 Depository or its nominee (or any successor Clearing Agency or
                 its nominee) if the Global Certificates have been issued or
                 if Definitive Preferred Security Certificates have been issued,
                 to the Holder thereof, and (B) in respect of the Common
                 Securities to the Holder thereof.

            (v)  Subject to the foregoing and applicable law (including,
                 without limitation, United States federal securities laws),
                 provided the acquirer is not the Holder of the Common
                 Securities or the obligor under the Indenture, the Sponsor or
                 any of its subsidiaries may at any time and from time to time
                 purchase outstanding Preferred Securities by tender, in the
                 open market or by private agreement.

     5. Voting Rights - Preferred Securities.

     (a) Except as provided under Section 5(b) and as otherwise required by law
and the Declaration, the Holders of the Preferred Securities will have no
voting rights.

     (b) If (i) the Trust fails to make Distributions in full on the Preferred
Securities for six consecutive quarterly Distribution periods (other than during
an Extension Period), or (ii) an Event of Default occurs and is continuing (each
of (i) and (ii) being an "Appointment Event"), then the Holders of the Preferred
Securities, acting as a single class, will be entitled by the vote of a Majority
in liquidation amount of the Preferred Securities to appoint a Special Regular
Trustee in accordance with Section 5.6(a)(ii)(B) of the Declaration. Any Holder
of Preferred Securities (other than the Sponsor, or any entity directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Sponsor) will be entitled to nominate any person to be
appointed as Special Regular Trustee. For purposes of determining whether the
Trust has failed to make Distributions in full for six consecutive quarterly
Distribution periods, Distributions shall be deemed to remain in arrears,
notwithstanding any payments in respect thereof, until full cumulative
Distributions have been or contemporaneously are paid with respect to all
quarterly Distribution periods terminating on or prior to the date of payment of
such cumulative Distributions.

     Not later than 30 days after such right to appoint a Special Regular
Trustee arises, the Regular Trustees will convene a meeting for the purpose of
appointing a Special Regular Trustee. If the Regular Trustees fail to convene
such meeting within such 30-day period, the Holders of 10% in liquidation
amount of the Preferred Securities will be entitled to convene such meeting in
accordance with Section 12.2 of the Declaration. The record date for such
meeting will be the close of business on the Business Day which is one Business
Day before the day on which notice of the meeting is


                                      10
<PAGE>   68

sent to Holders. The provisions of the Declaration relating to the convening and
conduct of the  meetings of the Holders will apply with respect to any such
meeting.

     A Special Regular Trustee may be removed without cause at any time by vote
of the Holders of a Majority in liquidation amount of the Preferred Securities
at a meeting of the Holders of the Preferred Securities in accordance with
Section 5.6(a)(ii)(B) of the Declaration.

     The Holders of 10% in liquidation amount of the Preferred Securities will
be entitled to convene such a meeting in accordance with Section 12.2 of the
Declaration. The record date for such meeting will be the close of business on
the Business Day which is one Business Day before the day on which the notice
of meeting is sent to Holders. Notwithstanding the appointment of a Special
Regular Trustee, the Debt Issuer shall retain all rights under the Indenture,
including the right to extend the interest payment period on the Notes.

     Subject to the requirements of the second to last sentence of this
paragraph, the Holders of a Majority in liquidation amount of the Preferred
Securities, voting separately as a class may direct the time, method, and place
of conducting any proceeding for any remedy available to the Property Trustee,
or exercising any trust or power conferred upon the Property Trustee under the
Declaration, including (i) directing the time, method, place of conducting
any proceeding for any remedy available to the Note Trustee, or executing any
trust or power conferred on the Note Trustee with respect to the Notes, (ii)
waive any past default and its consequences that is waivable under Section 7.13
of the Indenture, (iii) exercise any right to rescind or annul a declaration
that the principal of all the Notes shall be due and payable, or (iv) consent to
any amendment, modification or termination of the Indenture or the Notes, where
such consent shall be required, provided, however, that where a Super Majority
of the holders of the Notes is required, the Property Trustee may only give such
consent at the direction of the Holders of at least the proportion in
liquidation amount of the Preferred Securities which the relevant Super Majority
represents of the aggregate principal amount of the Notes. The Property Trustee
shall not revoke any action previously authorized or approved by a vote of the
Holders of the Preferred Securities. Other than with respect to directing the
time, method and place of conducting any remedy available to the Property
Trustee or the Note Trustee as set forth above, the Property Trustee shall not
take any action in accordance with the directions of the Holders of the
Preferred Securities under this paragraph unless the Property Trustee has
obtained an opinion of tax counsel to the effect that for the purposes of United
States federal income tax the Trust will not be classified as other than a
grantor trust. If the Property Trustee fails to enforce its rights under the
Declaration, any Holder of Preferred Securities



                                      11
<PAGE>   69
may, to the extent permissible by applicable law, after a period of 30 days has
elapsed from such holder's written request to the Property Trustee to enforce
such rights, institute a legal proceeding directly against any Person to
enforce the Property Trustee's rights under the Declaration, without first
instituting a legal proceeding against the Property Trustee or any other Person.

     Any approval or direction of Holders of Preferred Securities may be given
at a separate meeting of Holders of Preferred Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Preferred Securities are entitled to vote, or of
any matter upon which action by written consent of such Holders is to be taken,
to be mailed to each Holder of record of Preferred Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to
vote or of such matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.

     No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Notes in accordance with the Declaration and the terms of the
Securities.

     Notwithstanding that Holders of Preferred Securities are entitled to vote
or consent under any of the circumstances described above, any of the Preferred
Securities that are owned by the Sponsor, or by any entity directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Sponsor shall not be entitled to vote or consent and shall,
for purposes of such vote or consent, be treated as if they were not
outstanding.

     6. Voting Rights - Common Securities.

      (a)  Except as provided under Section 6(b), 6(c) and 7 as otherwise
           required by law and the Declaration, the Holders of the Common
           Securities will have no voting rights.

      (b)  The Holders of the Common Securities are entitled, in accordance
           with Article V of the Declaration, to vote to appoint, remove or
           replace any Trustee or to increase or decrease the number of
           Trustees, subject to the exclusive right of the Holders of the
           Preferred Securities to appoint, remove or replace a Special Regular
           Trustee.

      (c)  Subject to Section 2.6 of this Declaration and only after

                                      12
<PAGE>   70


           the Event of Default with respect to the Preferred Securities have
           been cured, waived, or otherwise eliminated, and subject to the
           requirements of the second to last sentence of this paragraph, the
           Holders of a Majority in liquidation amount of the Common Securities,
           voting separately as a class may direct the time, method, and place
           of conducting any proceeding for any remedy available to the Property
           Trustee, or exercising any trust or power conferred upon the Property
           Trustee under the Declaration, including (i) directing the time,
           method, place of conducting any proceeding for any remedy available
           to the Note Trustee, or executing any trust or power conferred on the
           Note Trustee with respect to the Notes, (ii) waive any past default
           and its consequences that is waivable under Section 7.13 of the
           Indenture, (iii) exercise any right to rescind or annul a declaration
           that the principal of all the Notes shall be due and payable, or (iv)
           consent to any amendment, modification or termination of the
           Indenture or the Notes, where such consent shall be required,
           provided, however, that where a consent under the Indenture would
           require the consent of greater than a majority of the Holders in
           principal amount of Notes affected thereby (a "Super Majority"),the
           Property Trustee may only give such consent at the direction of the
           Holders of at least the proportion in liquidation amount of the
           Common Securities which the relevant Super Majority represents of the
           aggregate principal amount of the Notes outstanding. The Property
           Trustee shall not revoke any action previously authorized or approved
           by a vote of the Holders of the Preferred Securities. Other than with
           respect to directing the time, method and place of conducting any
           remedy available to the Property Trustee or the Note Trustee as set
           forth above, the Property Trustee shall not take any action in
           accordance with the directions of the Holders of the Common
           Securities under this paragraph unless the Property Trustee has
           obtained an opinion of tax counsel to the effect that for the
           purposes of United States federal income tax the Trust will not be
           classified as other than a grantor trust.  If the Property Trustee
           fails to enforce its rights under the Declaration, any Holder of
           Common Securities may, after a period of 30 days has elapsed from
           such holder's written request to the Property Trustee to enforce such
           rights, institute a legal proceeding directly against any Person to
           enforce the Property Trustee's rights under the Declaration, without
           first instituting a legal proceeding against the Property Trustee or
           any other Person.

     Any approval or direction of Holders of Common Securities may be given at
a separate meeting of Holders of Common Securities convened for such purpose,
at a meeting of all of the Holders of




                                      13
<PAGE>   71


Securities in the Trust or pursuant to written consent. The Regular Trustees
will cause a notice of any meeting at which Holders of Common Securities are
entitled to vote, or of any matter upon which action by written consent of such
Holders is to be taken, to be mailed to each Holder of record of Common
Securities. Each such notice will include a statement setting forth (i) the date
of such meeting or the date by which such action is to be taken, (ii) a
description of any resolution proposed for adoption at such meeting on which
such Holders are entitled to vote or of such matter upon which written consent
is sought and (iii) instructions for the delivery of proxies or consents.

     No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
the Notes in accordance with the Declaration and the terms of the Securities.

     7. Amendments to Declaration and Indenture.

      (a)  If any proposed amendment to the Declaration provides for, or
           the Regular Trustees otherwise propose to effect, (i) any action
           that would adversely affect the powers, preferences or special
           rights of the Securities, whether by way of amendment to the
           Declaration or otherwise, or (ii) the dissolution, winding-up or
           termination of the Trust, other than as described in Section 8.1 of
           the Declaration, then the Holders of outstanding Securities as a
           class, will be entitled to vote on such amendment or proposal (but
           not on any other amendment or proposal) and such amendment or
           proposal shall not be effective except with the approval of the
           Holders of at least 66-2/3% in liquidation amount of the Securities,
           voting together as a single class provided, however, that the rights
           Holders of Preferred Securities under Article V of the Declaration
           to appoint, remove or replace a Special Regular Trustee shall not
           amended without the consent of each Holder of Preferred Securities,
           provided, however, if any amendment or proposal referred to in
           clause (i) above would adversely affect only the Preferred
           Securities or the Common Securities, only the affected class will be
           entitled to vote on such amendment or proposal and such amendment or
           proposal shall not be effective except with the approval of 66 2/3%
           in liquidation amount of such class of securities.

      (b)  In the event the consent of the Property Trustee as the
           holder of the Notes is required under the Indenture with respect to
           any amendment, modification or termination of the Indenture or the
           Notes, the Property Trustee shall request the direction of the
           Holders of the Securities with respect to such amendment,
           modification or



                                      14
<PAGE>   72





           termination and shall vote with respect to such amendment,
           modification or termination as directed by a Majority in liquidation
           amount of the Securities voting together as a single class; provided,
           however, that where a consent under the Indenture would require the
           consent of the holders of greater than a majority in aggregate
           principal amount of the Notes (a "Super Majority"), the Property
           Trustee may only give such consent at the direction of the Holders of
           at least the proportion in liquidation amount of the Securities which
           the relevant Super Majority represents of the aggregate principal
           amount of the Notes outstanding provided, further, that the Property
           Trustee shall not take any action in accordance with the directions
           of the Holders of the Securities under this Section 7(b) unless the
           Property Trustee has obtained an opinion of tax counsel to the effect
           that for the purposes of United States federal income tax the Trust
           will not be classified as other than a grantor trust.

     8. Pro Rata.

     A reference in these terms of the Securities to any payment, distribution
or treatment as being "Pro Rata" shall mean pro rata to each Holder of
Securities according to the aggregate liquidation amount of the Securities held
by the relevant Holder in relation to the aggregate liquidation amount of all
Securities outstanding unless, in relation to a payment, an Event of Default
under the Indenture has occurred and is continuing, in which case any funds
available to make such payment shall be paid first to each Holder of the
Preferred Securities pro rata according to the aggregate liquidation amount of
Preferred Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Preferred Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Preferred Securities, to
each Holder of Common Securities pro rata according to the aggregate
liquidation amount of Common Securities held by the relevant Holder relative to
the aggregate liquidation amount of all Common Securities outstanding.

     9. Ranking.

     The Preferred Securities rank pari pasu and payment thereon shall be made
Pro Rata with the Common Securities except that where an Event of Default
occurs and is continuing under the Indenture in respect of the Notes held by
the Property Trustee, the rights of Holders of the Common Securities to payment
in respect of Distributions and payments upon liquidation, redemption and
otherwise are subordinated to the rights to payment of the Holders of the
Preferred Securities.




                                      15
<PAGE>   73

     10. Listing.

     The Regular Trustees shall use their best efforts to cause the Preferred
Securities to be listed for quotation on the New York Stock Exchange.

     11. Acceptance of Securities Guarantee and Indenture.

     Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.

     12. No Preemptive Rights.

     The Holders of the Securities shall have no preemptive rights to subscribe
for any additional Securities.

     13. Miscellaneous.

     These terms constitute a part of the Declaration.

     The Regular Trustees will provide a copy of the Declaration, the Preferred
Securities Guarantee and the Indenture to a Holder without charge on written
request to the Trust at its principal place of business.




                                      16

<PAGE>   74

                                    Annex I

     [IF THE PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT - This
Preferred Security is a Global Certificate within the meaning of the
Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depository") or a nominee of the Depository.
This Preferred Security is exchangeable for Preferred Securities registered in
the name of a person other than the Depository or its nominee only in the
limited circumstances described in the Declaration and no transfer of this
Preferred Security (other than a transfer of this Preferred Security as a whole
by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository) may be
registered except in limited circumstances.

     Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York) to
the Trust or its agent for registration of transfer, exchange or payment, and
any Preferred Security issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of The Depository Trust
Company and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]

Certificate Number                                Number of Preferred Securities

    CUSIP NO.  ___________________


                 Certificate Evidencing Preferred Securities

                                      of

                          HOUSEHOLD CAPITAL TRUST V

                            Preferred Securities.

               (Liquidation Amount $25 per Preferred Security)

     Household Capital Trust V, a business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that _____________ (the
"Holder") is the registered owner of preferred securities of the Trust
representing undivided beneficial interests in the assets of the Trust
designated the _____% Trust Preferred Securities (liquidation amount $25 per
Preferred Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer. The designation, rights, privileges, restrictions,
preferences and other terms and





                                     A-1

<PAGE>   75

provisions of the Preferred Securities represented hereby are issued and shall
in all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of ______________, as the same may
be amended from time to time (the "Declaration") including the designation of
the terms of the Preferred Securities as set forth in Exhibit A to the
Declaration. Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Holder is entitled to the benefits
of the Preferred Securities Guarantee to the extent provided therein. The Trust
will provide a copy of the Declaration, the Preferred Securities Guarantee and
the Indenture to a Holder without charge upon written request to the Trust at
its principal place of business.

     Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.

     By acceptance, the Holder agrees to treat the Notes as indebtedness and
the Preferred Securities as evidence of indirect beneficial ownership in the
Notes.



               IN WITNESS WHEREOF, the Trust has executed this

                   certificate this ______ day of    , 199_.

                                              [    ]
                                              as Trustee




                                              ____________________________


                                              [    ]
                                                   as Trustee





                                              ____________________________



                                     A-2


<PAGE>   76




                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned assigns and transfer this Preferred
Security Certificate to:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_______________(Insert assignee's social security of tax identification number)


______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________
(Insert address and zip code of assignee) and irrevocably appoint)


______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_________________________________________ agent to transfer this Preferred
Security Certificate on the books of the Trust. The agent may substitute
another to act for him or her.

Date:__________________________________________________

Signature:_____________________________________________
(Sign exactly as your name appears on the other side of this Preferred Security
Certificate)



                                     A-3


<PAGE>   77


                                    Annex II

Certificate Number                                   Number of Common Securities

                   Certificate Evidencing Common Securities
                                      of
                          HOUSEHOLD CAPITAL TRUST V

                              Common Securities
                 (Liquidation Amount $__ per Common Security)

Household Capital Trust V, a business trust formed under the laws of the State
of Delaware (the "Trust"), hereby certifies that ________________ (the "Holder")
is the registered owner of common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the _______% Trust
Common Securities (liquidation amount $25 per Common Security) (the "Common
Securities"). The Common Securities are transferable on the books and records of
the Trust, in person or by a duly authorized attorney, upon surrender of this
certificate duly endorsed and in proper form for transfer. The designation,
rights, privileges, restrictions, preferences and other terms and provisions of
the Common Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust dated as of ___________, as the same may be amended from time to time
(the "Declaration") including the designation of the terms of the Common
Securities as set forth in Exhibit A to the Declaration. Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration. The
Holder is entitled to the benefits of the Common Securities Guarantee to the
extent provided therein. The Trust will provide a copy of the Declaration, the
Common Securities Guarantee and the Indenture to a Holder without charge upon
written request to the Trust at its principal place of business.

Upon receipt of this certificate, the Holder is bound by the Declaration and is
entitled to the benefits thereunder.

By acceptance, the Holder agrees to treat the Notes as indebtedness and the
Common Securities as evidence of indirect beneficial ownership in the Notes.

     IN WITNESS WHEREOF, the Trust has executed this certificate this day of
_____, 2000.

                                          [ ]
                                          as Trustee

                                          _______________________________

                                          [ ]
                                          as Trustee


                                          _______________________________


                                     A-4


<PAGE>   78


                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned assigns and transfer this Common
Security Certificate to:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_______________(Insert assignee's social security of tax identification number)


______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_____________________________________________________
(Insert address and zip code of assignee) and irrevocably appoint)


______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
_________________________________________ agent to transfer this Common
Security Certificate on the books of the Trust. The agent may substitute
another to act for him or her.

Date:__________________________________________________

Signature:_____________________________________________
(Sign exactly as your name appears on the other side of this Common Security
Certificate)


                                     A-5


<PAGE>   79


                                   EXHIBIT B

                                SPECIMEN OF NOTE

<PAGE>   80

                                   EXHIBIT C

                             UNDERWRITING AGREEMENT