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                                                                EXHIBIT 10.13(a)

                              EMPLOYMENT AGREEMENT

         THIS AGREEMENT, made and entered into as of March 1, 2002 by and
between Household International, Inc., a Delaware corporation, (hereinafter
called the "Corporation") and David A. Schoenholz (hereinafter called the
"Executive").


                                WITNESSETH THAT:

         WHEREAS, the Executive is currently employed by the Corporation under
an employment agreement dated January 1, 1999, and

         WHEREAS, the Corporation desires to continue to employ the Executive as
its Vice Chairman-Chief Financial Officer, and the Executive desires to continue
in such employment, on amended and restated terms and conditions;

         NOW, THEREFORE, the Corporation and the Executive, each intending to be
legally bound, hereby mutually covenant and agree as follows:

         1. Employment and Term.


            (a) Employment. The Corporation shall continue to employ the
Executive as the Vice Chairman-Chief Financial Officer of the Corporation, and
the Executive shall so serve, for the term set forth in Paragraph 1(b).

            (b) Term. The initial term of the Executive's employment under this
Agreement shall commence as of March 1, 2002 (the "Effective Date") and end on
August 31, 2003, subject to the extension of such term as hereinafter provided
and subject to earlier termination as provided in Paragraph 7, below. Beginning
on March 1, 2002, the term of this Agreement shall be extended automatically for
one (1) additional day for each day which has then elapsed since March 1, 2002,
unless, at any time after March 1, 2002, either the Board of Directors of the
Corporation (the "Board"), on behalf of the Corporation, or the Executive gives
written notice to the other that such automatic extension of the term of this
Agreement shall cease. Any such notice shall be effective immediately upon
delivery. The initial term of this Agreement, plus any extension by operation of
this Paragraph 1, shall be hereinafter referred to as the "Term."

         2. Duties. During the period of employment as provided in Paragraph
1(b) hereof, the Executive shall serve as Vice Chairman-Chief Financial Officer
of the Corporation and have all powers and duties consistent with such position,
subject to the reasonable direction of the Board and of the Chief Executive
Officer of the Corporation. The Executive shall also continue to serve as a
member of the Board if elected as such. The Executive shall devote substantially
his entire time during reasonable business hours (reasonable sick leave and
vacations excepted) and best efforts to fulfill faithfully, responsibly and to
the best of his ability his duties hereunder. However, the Executive may,

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with the approval of the Board or of the Chief Executive Officer of the
Corporation, which shall not be withheld unreasonably, serve on corporate, civic
and/or charitable boards and committees.

         3. Salary.


            (a) Base Salary. For services performed by the Executive for the
Corporation pursuant to this Agreement during the period of employment as
provided in Paragraph 1(b) hereof, the Corporation shall pay the Executive a
base salary of $500,000 per year, payable in substantially equal installments in
accordance with the Corporation's regular payroll practices. The Executive's
base salary (with any increases under paragraph (b), below) shall not be subject
to reduction. Any compensation which may be paid to the Executive under any
additional compensation or incentive plan of the Corporation or which may be
otherwise authorized from time to time by the Board (or an appropriate committee
thereof) shall be in addition to the base salary to which the Executive shall be
entitled under this Agreement.

            (b) Salary Increases. During the period of employment as provided in
Paragraph 1(b) hereof, the base salary of the Executive shall be reviewed no
less frequently than annually by the Board or the Compensation Committee of the
Board to determine whether or not the same should be increased in light of the
duties and responsibilities of the Executive and the performance thereof, and if
it is determined that an increase is merited, such increase shall be promptly
put into effect and the base salary of the Executive as so increased shall
constitute the base salary of the Executive for purposes of Paragraph 3(a).

         4. Annual Bonuses. For each calendar year during the term of
employment, the Executive shall be eligible to receive in cash an annual
performance bonus based upon the terms of the Corporation's bonus plan from time
to time for senior executives, as adopted by the Board and administered by the
Compensation Committee.

         5. Equity Incentive Compensation. During the term of employment
hereunder the Executive shall be eligible to participate, in the manner and to
the extent approved by the Board or the Compensation Committee, in any
equity-based incentive compensation plan or program approved by the Board from
time to time, including (but not by way of limitation) any plan providing for
the granting of (a) options to purchase stock of the Corporation, (b) restricted
stock of the Corporation or (c) similar equity-based units or interests, with
awards to the Executive that are of appropriate size and nature relative to
those for other senior executives and the individual performance of the
Executive.

         6. Other Benefits. In addition to the compensation described in
Paragraphs 3, 4 and 5, above, the Executive shall also be entitled to
participate in all of the various retirement, welfare, fringe benefit, executive
perquisite, and expense reimbursement plans, programs and arrangements of the
Corporation to the extent the Executive is eligible for participation under the
terms of such plans, programs and arrangements, with benefit levels and terms of
participation at least as favorable to the Executive as those in effect on the



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Effective Date, except that the Executive's benefits and/or perquisites may be
reduced in connection with similar reductions uniformly applied with respect to
all similarly situated employees.

         7. Termination. Unless earlier terminated in accordance with the
following provisions of this Paragraph 7, the Corporation shall continue to
employ the Executive and the Executive shall remain employed by the Corporation
during the entire term of this Agreement as set forth in Paragraph 1(b).
Paragraph 9 hereof sets forth certain obligations of the Corporation in the
event that the Executive's employment hereunder is terminated. Certain
capitalized terms used in this Paragraph 7 and in Paragraphs 8 and 9 hereof are
defined in Paragraph 7(d), below.

            (a) Death or Disability. Except to the extent otherwise provided in
Paragraph 9 with respect to certain post-Date of Termination payment obligations
of the Corporation, this Agreement shall terminate immediately as of the Date of
Termination in the event of the Executive's death or in the event that the
Executive becomes disabled. The Executive will be deemed to be disabled upon the
earlier of (i) the end of a six (6)-consecutive month period during which, by
reason of physical or mental injury or disease, the Executive has been unable to
perform substantially all of his usual and customary duties under this Agreement
or (ii) the date that a reputable physician selected by the Board, and as to
whom the Executive has no reasonable objection, determines in writing that the
Executive will, by reason of physical or mental injury or disease, be unable to
perform substantially all of the Executive's usual and customary duties under
this Agreement for a period of at least six (6) consecutive months. If any
question arises as to whether the Executive is disabled, upon reasonable request
therefor by the Board, the Executive shall submit to reasonable medical
examination for the purpose of determining the existence, nature and extent of
any such disability. The Board shall promptly give the Executive written notice
of any such determination of the Executive's disability and of any decision of
the Board to terminate the Executive's employment by reason thereof. Until the
Date of Termination for disability, the base salary payable to the Executive
under Paragraph 3 hereof shall be reduced dollar-for-dollar by the amount of any
disability benefits paid to the Executive in accordance with any disability
policy or program of the Corporation.

            (b) Discharge for Cause. In accordance with the procedures
hereinafter set forth, the Board may discharge the Executive from his employment
hereunder for Cause. Except to the extent otherwise provided in Paragraph 9 with
respect to certain post-Date of Termination obligations of the Corporation, this
Agreement shall terminate immediately as of the Date of Termination in the event
the Executive is discharged for Cause. Any discharge of the Executive for Cause
shall be communicated by a Notice of Termination to the Executive given in
accordance with Paragraph 17 of this Agreement. For purposes of this Agreement,
a "Notice of Termination" means a written notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated and
(iii) specifies the termination date, which may be as




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early as the date of the giving of such notice. No purported termination of the
Executive's employment for Cause shall be effective without a Notice of
Termination.

            (c) Termination for Other Reasons. The Corporation may discharge the
Executive without Cause by giving written notice to the Executive in accordance
with Paragraph 17 at least fifteen (15) days prior to the Date of Termination.
The Executive may resign from his employment, without liability to the
Corporation, by giving written notice to the Corporation in accordance with
Paragraph 17 at least fifteen (15) days prior to the Date of Termination. Except
to the extent otherwise provided in Paragraph 9 with respect to certain
post-Date of Termination obligations of the Corporation, this Agreement shall
terminate immediately as of the Date of Termination in the event the Executive
is discharged without Cause or resigns.

            (d) Definitions. For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:

                (i) "Accrued Obligations" shall mean, as of the Date of
Termination, the sum of (A) the Executive's base salary under Paragraph 3
through the Date of Termination to the extent not theretofore paid, (B) the
amount of any bonus, incentive compensation, deferred compensation and other
cash compensation accrued by the Executive as of the Date of Termination to the
extent not theretofore paid and (C) any vacation pay, expense reimbursements and
other cash entitlements accrued by the Executive as of the Date of Termination
to the extent not theretofore paid. For the purpose of this Paragraph 7(d)(i),
amounts shall be deemed to accrue ratably over the period during which they are
earned, but no discretionary compensation shall be deemed earned or accrued
until it is specifically approved by the Board or the Compensation Committee in
accordance with the applicable plan, program or policy.

                (ii) "Cause" shall mean: (A) the Executive's commission of an
act materially and demonstrably detrimental to the financial condition and/or
goodwill of the Corporation or any of its subsidiaries, which act constitutes
gross negligence or willful misconduct by the Executive in the performance of
his material duties to the Corporation or any of its subsidiaries, or (B) the
Executive's commission of any material act of dishonesty or breach of trust
resulting or intended to result in material personal gain or enrichment of the
Executive at the expense of the Corporation or any of its subsidiaries, or (C)
the Executive's conviction of a felony involving moral turpitude, but
specifically excluding any conviction based entirely on vicarious liability. No
act or failure to act will be considered "willful" unless it is done, or omitted
to be done, by the Executive in bad faith or without reasonable belief that his
action or omission was in the best interests of the Corporation. In addition, no
act or omission will constitute Cause unless the Corporation has given detailed
written notice thereof to the Executive and, where remedial action is feasible,
he then fails to remedy the act or omission within a reasonable time after
receiving such notice.

                (iii) A "Change in Control" shall be deemed to have occurred if:


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                      (A) Any "person" (as defined in Section 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act")), excluding
for this purpose the Corporation or any subsidiary of the Corporation, or any
employee benefit plan of the Corporation or any subsidiary of the Corporation,
or any person or entity organized, appointed or established by the Corporation
for or pursuant to the terms of such plan which acquires beneficial ownership of
voting securities of the Corporation, is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act) directly or indirectly of
securities of the Corporation representing twenty percent (20%) or more of the
combined voting power of the Corporation's then outstanding securities;
provided, however, that no Change in Control shall be deemed to have occurred as
the result of an acquisition of securities of the Corporation by the Corporation
which, by reducing the number of voting securities outstanding, increases the
direct or indirect beneficial ownership interest of any person to twenty percent
(20%) or more of the combined voting power of the Corporation's then outstanding
securities, but any subsequent increase in the direct or indirect beneficial
ownership interest of such a person in the Corporation shall be deemed a Change
in Control; and provided further that if the Board of Directors of the
Corporation determines in good faith that a person who has become the beneficial
owner directly or indirectly of securities of the Corporation representing
twenty percent (20%) or more of the combined voting power of the Corporation's
then outstanding securities has inadvertently reached that level of ownership
interest, and if such person divests as promptly as practicable a sufficient
amount of securities of the Corporation so that the person no longer has a
direct or indirect beneficial ownership interest in twenty percent (20%) or more
of the combined voting power of the Corporation's then outstanding securities,
then no Change in Control shall be deemed to have occurred;

                      (B) During any period of two (2) consecutive years (not
including any period prior to the Effective Date of this Agreement), individuals
who at the beginning of such two-year period constitute the Board of Directors
of the Corporation and any new director or directors (except for any director
designated by a person who has entered into an agreement with the Corporation to
effect a transaction described in subparagraph (A), above, or subparagraph (C),
below) whose election by the Board or nomination for election by the
Corporation's shareholders was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority of the Board (such
individuals and any such new directors being referred to as the "Incumbent
Board"); or

                      (C) Consummation of (1) an agreement for the sale or
disposition of the Corporation or all or substantially all of the Corporation's
assets, (2) a plan of merger or consolidation of the Corporation with any other
corporation, or (3) a similar transaction or series of transactions involving
the Corporation (any transaction described in parts (1) through (3) of this
subparagraph (C) being referred to as a "Business Combination"), in each case
unless after such a Business Combination (x) the shareholders of the Corporation
immediately prior to the Business Combination continue to own, directly or
indirectly, more than sixty percent (60%) of the combined voting power of the
then outstanding voting



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securities entitled to vote generally in the election of directors of the new
(or continued) entity (including, but not by way of limitation, an entity which
as a result of such transaction owns the Corporation or all or substantially all
of the Corporation's former assets either directly or through one or more
subsidiaries) immediately after such Business Combination, in substantially the
same proportion as their ownership of the Corporation immediately prior to such
Business Combination, (y) no person (excluding any entity resulting from such
Business Combination or any employee benefit plan (or related trust) of the
Corporation or of such entity resulting from such Business Combination)
beneficially owns, directly or indirectly, twenty percent (20%) or more of the
then combined voting power of the then outstanding voting securities of such
entity, except to the extent that such ownership existed prior to the Business
Combination, and (z) at least a majority of the members of the board of
directors of the entity resulting from such Business Combination were members of
the Incumbent Board at the time of the execution of the initial agreement, or of
the action of the Board, providing for such Business Combination; or

                      (D) Approval by the shareholders of the Corporation of a
complete liquidation or dissolution of the Corporation.

                      Any other provision of this Agreement to the contrary
notwithstanding, a "Change in Control" shall not include any transaction
described in subparagraph (A) or (C), above, where, in connection with such
transaction, the Executive and/or any party acting in concert with the Executive
substantially increases his or its, as the case may be, ownership interest in
the Corporation or a successor to the Corporation (other than through conversion
of prior ownership interests in the Corporation and/or through equity awards
received entirely as compensation for past or future personal services).

                      (iv) "Date of Termination" shall mean (A) in the event of
a discharge of the Executive by the Board for Cause, the date specified in such
Notice of Termination, (B) in the event of a discharge of the Executive without
Cause or a resignation by the Executive, the date specified in the written
notice to the Executive (in the case of discharge) or the Corporation (in the
case of resignation), which date shall be no less than fifteen (15) days from
the date of such written notice, (C) in the event of the Executive's death, the
date of the Executive's death, and (D) in the event of termination of the
Executive's employment by reason of disability pursuant to Paragraph 7(a), the
date the Executive receives written notice of such termination.

                      (v) "Good Reason" shall mean any of the following without
the consent of the Executive: (A) the failure to re-elect the Executive as Vice
Chairman-Chief Financial Officer, (B) assignment of duties inconsistent with the
Executive's position, authority, duties or responsibilities, or any other action
by the Corporation which results in a substantial diminution of such position,
authority, duties or responsibilities, other than an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the
Corporation promptly after receipt of notice thereof given by the Executive, (C)
any failure by the Corporation to comply with any of the provisions of this
Agreement, including (but not by way of limitation) those provisions regarding
compensation and benefits, other



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than an isolated, insubstantial and inadvertent action not taken in bad faith
and which is remedied by the Corporation promptly after receipt of notice
thereof given by the Executive, or (D) the Corporation giving notice to the
Executive to stop further operation of the evergreen feature described in
Paragraph 1(b), above. However, during the period of three (3) years after a
Change in Control, "Good Reason" shall also include the Executive being
reassigned, without the Executive's consent, to an office location outside of
the Chicago, Illinois metropolitan area. In addition, termination by the
Executive for any reason during the sixty (60)-day period which begins twelve
(12) months after a Change in Control shall be deemed to be a termination for
Good Reason; provided, however, that if the Executive dies after a Change in
Control but less than twelve (12) months after a Change in Control, the
Executive will be deemed to have terminated employment for Good Reason twelve
(12) months after the Change in Control.

                      (vi) "Qualifying Termination" shall mean termination of
the Executive's employment under this Agreement (A) by reason of the discharge
of the Executive by the Corporation other than for Cause or disability or (B) by
reason of the resignation of the Executive for Good Reason within twelve (12)
months after an event constituting Good Reason or (C) in accordance with the
last sentence of the definition of Good Reason in subparagraph (v), above.

            (e) Continuing Obligations. Notwithstanding the termination of this
Agreement pursuant to Paragraph 7(a), 7(b) or 7(c) above, or upon the expiration
of the term described in Paragraph 1 above, the respective covenants, agreements
and obligations of the Corporation and the Executive set forth hereinafter shall
continue.

         8. Vesting of Equity Awards Upon a Change in Control. Immediately upon
the Change in Control, all stock options, restricted stock and other equity
awards previously made to the Executive which are not otherwise vested shall
vest in full, and all such options shall remain exercisable for the period
provided for the applicable plan or award agreement.

         9. Obligations of the Corporation Upon Termination. The following
provisions describe the obligations of the Corporation to the Executive under
this Agreement upon termination of his employment. However, except as explicitly
provided in this Agreement, nothing in this Agreement shall limit or otherwise
adversely affect any rights which the Executive may have under applicable law,
under any other agreement with the Corporation or any of its subsidiaries, or
under any compensation or benefit plan, program, policy or practice of the
Corporation or any of its subsidiaries.

            (a) Death, Disability, Discharge for Cause, or Resignation Without
Good Reason. In the event this Agreement terminates by reason of the death or
disability of the Executive, or by reason of the discharge of the Executive by
the Corporation for Cause, or by reason of the resignation of the Executive
other than for Good Reason, the Corporation shall pay to the Executive, or his
heirs or estate, in the event of the Executive's death, all Accrued Obligations
in a lump sum within thirty (30) days after the Date of Termination; provided,
however, that any portion of the Accrued Obligations which consists of bonus,
deferred

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compensation, or incentive compensation shall be determined and paid in
accordance with the terms of the relevant plan as applicable to the Executive.

            (b) Death, Disability or Retirement. In the event that Executive's
employment is terminated by death, disability or retirement under a retirement
plan of the Corporation, the Executive shall be entitled to receive in a lump
sum within thirty (30) days after the Date of Termination, in addition to the
compensation and benefits described in paragraph (a) above, a pro rata cash
bonus for the year in which the Date of Termination occurs equal to the product
of (i) the highest of the annual bonuses payable to the Executive for the three
(3) years preceding the year in which the Date of Termination occurs, including
any bonus or portion thereof that has been earned but deferred (and annualized
for any fiscal year consisting of less than 12 full months or during which the
Executive was employed for less than 12 full months) (the "Highest Annual
Bonus"), and (ii) a fraction, the numerator of which is the number of days in
the current fiscal year through the Date of Termination, and the denominator of
which is 365.

            (c) Qualifying Termination Without a Change in Control. In the event
of a Qualifying Termination without a Change in Control, the Executive shall,
upon executing and delivering a release of liability satisfactory to the
Corporation, receive the following benefits:

                (i) Payment of all Accrued Obligations in a lump sum within
thirty (30) days after the Date of Termination; provided, however, that any
portion of the Accrued Obligations which consists of bonus, deferred
compensation or incentive compensation shall be determined and paid in
accordance with the terms of the relevant plan as applicable to the Executive,

                (ii) Payment in a lump sum within thirty (30) days after the
Date of Termination of a salary replacement amount equal to one hundred fifty
percent (150%) of the Executive's base salary as in effect prior to the
termination,

                (iii) Payment in a lump sum within thirty (30) days after the
Date of Termination of a bonus replacement amount equal to one hundred fifty
percent (150%) of the Highest Annual Bonus,

                (iv) Continuation, for a period of eighteen (18) months after
the Date of Termination, of health insurance benefits under the Consolidated
Omnibus Budget Reconciliation Act ("COBRA") with the cost of such benefits to be
paid by the Corporation, but such benefits may be discontinued earlier to the
extent that the Executive becomes entitled to comparable benefits from a
subsequent employer,

                (v) Immediate pro rata vesting of all stock options, restricted
stock and other equity or incentive compensation awards to the Executive which
are not otherwise fully vested, with all options to remain exercisable for the
period provided for in the applicable plan or award agreement. The proration of
each award shall be done by


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multiplying the full award by a fraction, the numerator of which shall be the
number of full months between the date of grant and the Date of Termination, and
the denominator of which shall be the number of full months in the period of
employment required for full vesting under the original terms of the award, and

                (vi) Outplacement services, at the expense of the Corporation,
from a provider reasonably selected by the Executive.

In addition, the Executive may, in the discretion of the Compensation Committee,
be awarded a pro rata cash bonus for the year in which the Date of Termination
occurs.

            (d) Qualifying Termination After a Change in Control. In the event
of a Qualifying Termination within three (3) years after a Change in Control,
the Executive shall receive, in addition to the compensation and benefits
described in subparagraphs (c)(i) and (c)(vi), above, the following benefits:

                (i) Payment in a lump sum within thirty (30) days after the Date
of Termination of a pro rata cash bonus for the year in which the Date of
Termination occurs equal to the product of (x) the Highest Annual Bonus and (y)
a fraction, the numerator of which is the number of days in the current fiscal
year through the Date of Termination and the denominator of which is 365;

                (ii) Payment in a lump sum within thirty (30) days after the
Date of Termination of a salary replacement amount equal to three hundred
percent (300%) of the Executive's base salary as in effect prior to the
termination,

                (iii) Payment in a lump sum within thirty (30) days after the
Date of Termination of a bonus replacement amount equal to three hundred percent
(300%) of the Highest Annual Bonus;

                (iv) Continuation, for a period of three (3) years after the
Date of Termination, of the following welfare benefits and senior executive
perquisites on terms at least as favorable to the Executive as those which would
have been provided if the Executive's employment had continued for that time
pursuant to this Agreement: medical and dental benefits, life and disability
insurance, umbrella liability insurance coverage, executive physical
examinations, and automobile and financial counseling allowances, with the cost
of such benefits to be paid by the Corporation. To the extent the Corporation is
unable to provide comparable insurance for reasons other than cost, the
Corporation may provide a lesser level or no coverage and compensate the
Executive for the difference in coverage through a cash lump sum payment grossed
up for taxes. This payment will be tied to the cost of an individual insurance
policy if it were assumed to be available. The medical and dental benefits
provided hereunder shall not be considered a continuation of coverage under
COBRA, and continuation coverage under COBRA shall be made available to the
Executive at the end of such three (3) year period as if the Executive's
employment had terminated on the last day of such period. For purposes of
determining eligibility (but not


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the time of commencement of benefits) of the Executive for retiree benefits
pursuant to post-retirement welfare benefit plans, practices, programs and
policies of the Corporation, the Executive shall be considered to have remained
employed for three (3) years after the Date of Termination and, therefore, will
be treated as having three (3) additional years of age and service credit after
the Date of Termination and as having retired on the last day of such three (3)
year period;

                (v) For purposes of determining the Executive's benefits under
the Corporation's non-qualified excess and supplemental defined benefit
retirement plans (the "SERP") in which the Executive participates, the
Executive's benefits under the SERP shall equal the excess of (x) the actuarial
equivalent (utilizing actuarial assumptions determined on a basis no less
favorable to the Executive than the basis used under the terms of the Retirement
Plan as in effect immediately prior to the Change in Control) of the sum of (A)
the benefit under the Corporation's qualified defined benefit retirement plan
(the "Retirement Plan") and (B) the benefit under any excess or supplemental
retirement plans in which the Executive participates (collectively, the "SERP"),
based on the Executive's period of service through the Date of Termination and
assuming for this purpose that: (1) the Executive's employment continued for
three years after the Date of Termination, and, therefore, the Executive had
three (3) additional years of age and service credit after the Date of
Termination under the Retirement Plan and the SERP, (2) all accrued benefits
under the Retirement Plan and the SERP are fully vested and (3) the Executive's
salary and annual bonus for each year during such three (3) year period were the
salary replacement and bonus replacement amounts described in subparagraphs (ii)
and (iii) above, over (y) the actuarial equivalent of the Executive's actual
benefit (paid or payable), if any, under the Retirement Plan, as of the Date of
Termination; and

                (vi) Payment in a lump sum within thirty (30) days after the
Date of Termination of an amount equal to the sum of the maximum matching
contributions by the Corporation under the Corporation's tax-qualified and
supplemental Section 401(k) plans in which the Executive participates that the
Executive would have received if the Executive's employment continued for three
(3) years after the Date of Termination, assuming for this purpose that: (x) the
Executive's salary and annual bonus for each year during such three (3) year
period were the salary replacement and bonus replacement amounts described in
subparagraphs (ii) and (iii) above and (y) the Company's matching contributions
are determined pursuant to the applicable provisions of the Corporation's
tax-qualified and supplemental Section 401(k) plans, as in effect immediately
prior to the Change in Control.

            (e) Termination of Employment Prior to Change in Control. Anything
in this Agreement to the contrary notwithstanding, if a Change in Control occurs
and if the Executive's employment with the Corporation is terminated within six
(6) months prior to the date on which the Change in Control occurs, and if it is
reasonably demonstrated by the Executive that such termination of employment (i)
was at the request of a third party who was taking steps reasonably calculated
to effect a Change in Control or (ii) otherwise arose in connection with or in
anticipation of a Change in Control, then for all purposes of this



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Agreement the termination of the Executive's employment shall be deemed to have
occurred immediately after the Change in Control.

         10. Certain Additional Payments by the Corporation. The Corporation
agrees that:

            (a) Anything in this Agreement to the contrary notwithstanding, in
the event it shall be determined that any payment or distribution by the
Corporation to or for the benefit of the Executive (whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments required
under this Paragraph 10) (a "Payment") would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended, (the
"Code") or if any interest or penalties are incurred by the Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, being hereinafter collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that, after payment by the Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payment.

            (b) Subject to the provisions of paragraph (c), below, all
determinations required to be made under this Paragraph 10, including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up Payment
and the assumptions to be utilized in arriving at such determination, shall be
made by the accounting firm which is then serving as the auditors for the
Corporation (the "Accounting Firm"), which shall provide detailed supporting
calculations both to the Corporation and the Executive within fifteen (15)
business days of the receipt of notice from the Executive that there has been a
Payment, or such earlier time as is requested by the Corporation. In the event
that the Accounting Firm is serving as accountant or auditor for the individual,
entity or group effecting the Change in Control, the Executive shall appoint
another nationally recognized accounting firm to make the determinations
required hereunder (which accounting firm shall then be referred to as the
Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall
be borne solely by the Corporation. Any Gross-Up Payment, as determined pursuant
to this Paragraph 10, shall be paid by the Corporation to the Executive within
five (5) days of the receipt of the Accounting Firm's determination. If the
Accounting Firm determines that no Excise Tax is payable by the Executive, it
shall furnish the Executive with a written opinion that failure to report the
Excise Tax on the Executive's applicable federal income tax return would not
result in the imposition of a negligence or similar penalty. Any good faith
determination by the Accounting Firm shall be binding upon the Corporation and
the Executive. As a result of the uncertainty in the application of Section 4999
of the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that Gross-Up Payments which will not have been made
by the Corporation should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Corporation
exhausts its remedies pursuant to paragraph (c), below, and the Executive
thereafter is required to make a payment of any Excise Tax, the Accounting Firm


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<PAGE>




shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Corporation to or for the benefit of
the Executive.

            (c) The Executive shall notify the Corporation in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Corporation of a Gross-Up Payment. Such notification shall be
given as soon as practicable but no later than fifteen (15) business days after
the Executive is informed in writing of such claim and shall apprise the
Corporation of the nature of such claim and the date on which such claim is
requested to be paid. The Executive shall not pay such claim prior to the
expiration of the thirty (30)-day period following the date on which Executive
gives such notice to the Corporation (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If the Corporation
notifies the Executive in writing prior to the expiration of such period that it
desires to contest such claim, the Executive shall:

                (i) Give the Corporation any information reasonably requested by
the Corporation relating to such claim,

                (ii) Take such action in connection with contesting such claim
as the Corporation shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with respect to
such claim by an attorney reasonably selected by the Corporation,

                (iii) Cooperate with the Corporation in good faith in order
effectively to contest such claim, and

                (iv) Permit the Corporation to participate in any proceedings
relating to such claim;

provided, however, that the Corporation shall bear and pay directly all costs
and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limiting the foregoing
provisions of this paragraph (c), the Corporation shall control all proceedings
taken in connection with such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings, hearings and conferences
with the taxing authority in respect of such claim and may, at its sole option,
either direct the Executive to pay the tax claimed and sue for a refund or
contest the claim in any permissible manner; and the Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate courts, as the
Corporation shall determine; provided, however, that if the Corporation directs
the Executive to pay such claim and sue for a refund, the Corporation shall
advance the amount of such payment to the Executive on an interest-free basis
and shall indemnify and hold the Executive harmless, on an after-tax basis, from
any Excise Tax or income tax (including interest or penalties with respect
thereto) imposed with


                                       12
<PAGE>




respect to such advance or with respect to any imputed income with respect to
such advance; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Corporation's control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

            (d) If, after the receipt by the Executive of an amount advanced by
the Corporation pursuant to paragraph (c), above, the Executive becomes entitled
to receive any refund with respect to such claim, the Executive shall (subject
to the Corporation's complying with the requirements of said paragraph (c))
promptly pay to the Corporation the amount of such refund (together with any
interest paid or credited thereon, after taxes applicable thereto). If, after
the receipt by the Executive of an amount advanced by the Corporation pursuant
to said paragraph (c), a determination is made that the Executive shall not be
entitled to any refund with respect to such claim and the Corporation does not
notify the Executive in writing of its intent to contest such denial of refund
prior to the expiration of thirty (30) days after such determination, then such
advance shall be forgiven and shall not be required to be repaid; and the amount
of such advance shall offset, to the extent thereof, the amount of the Gross-Up
Payment required to be paid.

         11. No Set-Off or Mitigation. The Corporation's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Corporation may have against
the Executive or others. In no event shall the Executive be obligated to seek
other employment or take any other action by way of mitigation of the amounts
payable to the Executive under any of the provisions of this Agreement, and such
amounts shall not be reduced whether or not the Executive obtains other
employment.

         12. Payment of Certain Expenses. The Corporation agrees to pay promptly
as incurred, to the fullest extent permitted by law, all legal fees and expenses
which the Executive may reasonably incur as a result of any contest (regardless
of the outcome) by the Corporation, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement
(including as a result of any contest initiated by the Executive about the
amount of any payment due pursuant to this Agreement), plus in each case
interest on any delayed payment at the applicable federal rate provided for in
Section 7872(f)(2)(A) of the Code; provided, however, that, notwithstanding
anything contained herein to the contrary, with respect to contests arising
prior to a Change in Control (and not otherwise directly associated with the
Change in Control), the Corporation shall not be obligated to make such payment
with respect to any such contest in which the Corporation prevails over the
Executive.


                                       13
<PAGE>




         13. Indemnification. To the full extent permitted by law, the
Corporation shall, both during and after the term of the Executive's employment,
indemnify the Executive (including the advancement of expenses) for any
judgments, fines, amounts paid in settlement and reasonable expenses, including
attorneys' fees, incurred by the Executive in connection with the defense of any
lawsuit or other claim to which he is made a party by reason of being (or having
been) an officer, director or employee of the Corporation or any of its
subsidiaries. In addition, the Executive shall be covered, both during and after
the term of the Executive's employment, by director and officer liability
insurance to the maximum extent that such insurance covers any officer or
director (or former officer or director) of the Corporation.

         14. Confidentiality. During and after the period of employment with the
Corporation, the Executive shall not, without prior written consent from the
Chief Executive Officer or the General Counsel of the Corporation directly or
indirectly disclose to any individual, corporation or other entity, other than
to the Corporation or any subsidiary or affiliate thereof or their officers,
directors or employees entitled to such information or any other person or
entity to whom such information is disclosed in the normal course of the
business of the Corporation) or use for the Executive's own benefit or for the
benefit of any such individual, corporation or other entity, any Confidential
Information of the Corporation. For purposes of this Agreement, "Confidential
Information" is information relating to the business of the Corporation or its
subsidiaries or affiliates (a) which is not generally known to the public or in
the industry, (b) which has been treated by the Corporation and its subsidiaries
and affiliates as confidential or proprietary, (c) which provides the
Corporation or its subsidiaries or affiliates with a competitive advantage, and
(d) in the confidentiality of which the Corporation has a legally protectable
interest. Confidential Information which becomes generally known to the public
or in the industry, or in the confidentiality of which the Corporation and its
subsidiaries and affiliates cease to have a legally protectable interest, shall
cease to be subject to the restrictions of this Paragraph 14.

         15. Status Under FDIC Regulations. This Agreement amends and restates a
prior employment agreement dated July 11, 1994 which was entered into prior to
March 29, 1995, which was the date that regulations were proposed by the Federal
Deposit Insurance Corporation (the "FDIC") limiting "golden parachute" and
indemnification payments by insured depository institutions and their holding
companies. As of March 29, 1995 that prior agreement provided for a lump sum
payment equal to 560% of the Executive's base salary. In view of the foregoing,
if the payments and other benefits under Paragraph 9 of this Agreement are
limited by those FDIC regulations, it is currently anticipated that any limits
on "golden parachute" payments resulting from regulations issued by the FDIC
should not reduce the payments under this Agreement below the lesser of (a) 560%
of the Executive's base salary or (b) the payments and other benefits calculated
under Paragraph 9 of this Agreement. However, if FDIC regulations are ultimately
determined to further limit payments and other benefits under this Agreement,
then such FDIC limits shall supersede the terms of Paragraph 9, above.


                                       14
<PAGE>

         16. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the heirs and representatives of the Executive and the successors
and assigns of the Corporation. The Corporation shall require any successor
(whether direct or indirect, by purchase, merger, reorganization, consolidation,
acquisition of property or stock, liquidation, or otherwise) to all or a
substantial portion of its assets, by agreement in form and substance reasonably
satisfactory to the Executive, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Corporation would
be required to perform this Agreement if no such succession had taken place.
Regardless of whether such an agreement is executed, this Agreement shall be
binding upon any successor of the Corporation in accordance with the operation
of law, and such successor shall be deemed the "Corporation" for purposes of
this Agreement.

         17. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered by hand or by recognized commercial delivery service or if mailed
within the continental United States by first class certified mail, return
receipt requested, postage prepaid, addressed as follows:

                (1)   If to the Board or the Corporation, to:

                      Household International, Inc.
                      2700 Sanders Road
                      Prospect Heights, Illinois  60070
                      Attention:  Executive Vice President-Administration

                (2)   If to the Executive, to:

                      Household International, Inc.
                      2700 Sanders Road
                      Prospect Heights, Illinois  60070
                      Attention:  David A. Schoenholz

Such addresses may be changed by written notice sent to the other party at the
last recorded address of that party.

         18. Tax Withholding. The Corporation shall provide for the withholding
of any taxes required to be withheld by federal, state, or local law with
respect to any payment in cash, shares of stock and/or other property made by or
on behalf of the Corporation to or for the benefit of the Executive under this
Agreement or otherwise. The Corporation may, at its option: (a) withhold such
taxes from any cash payments owing from the Corporation to the Executive, (b)
require the Executive to pay to the Corporation in cash such amount as may be
required to satisfy such withholding obligations and/or (c) make other
satisfactory arrangements with the Executive to satisfy such withholding
obligations.

         19. Arbitration. Except as to any controversy or claim which the
Executive elects, by written notice to the Corporation, to have adjudicated by a
court of competent jurisdiction,


                                       15
<PAGE>




any controversy or claim arising out of or relating to this Agreement or the
breach hereof shall be settled by arbitration in Chicago, Illinois in accordance
with the laws of the State of Illinois. The arbitration shall be conducted in
accordance with the rules of the American Arbitration Association. The costs and
expenses of the arbitrator(s) shall be borne by the Corporation. The award of
the arbitrator(s) shall be binding upon the parties. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction.

         20. No Assignment. Except as otherwise expressly provided herein, this
Agreement is not assignable by any party and no payment to be made hereunder
shall be subject to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or other charge.

         21. Execution in Counterparts. This Agreement may be executed by the
parties hereto in two (2) or more counterparts, each of which shall be deemed to
be an original, but all such counterparts shall constitute one and the same
instrument, and all signatures need not appear on any one counterpart.

         22. Jurisdiction and Governing Law. This Agreement shall be construed
and interpreted in accordance with and governed by the laws of the State of
Illinois, other than the conflict of laws provisions of such laws.

         23. Severability. If any provision of this Agreement shall be adjudged
by any court of competent jurisdiction to be invalid or unenforceable for any
reason, such judgment shall not affect, impair or invalidate the remainder of
this Agreement. Furthermore, if the scope of any restriction or requirement
contained in this Agreement is too broad to permit enforcement of such
restriction or requirement to its full extent, then such restriction or
requirement shall be enforced to the maximum extent permitted by law, and the
Executive consents and agrees that any court of competent jurisdiction may so
modify such scope in any proceeding brought to enforce such restriction or
requirement.

         24. Prior Understandings. This Agreement embodies the entire
understanding of the parties hereto and supersedes all other oral or written
agreements or understandings between them regarding the subject matter hereof,
including but not by way of limitation by amending and restating the Employment
Agreement dated January 1, 1999 between the parties. This Agreement also
supersedes the Employment Agreement dated July 9, 1996, the Employment Agreement
dated January 3, 1994, the Employment Agreement dated May 28, 1993, the
Employment Agreement dated December 1, 1989, the Senior Executive Employment
Agreement dated January 1, 1988, and the Supplemental Employment Agreement dated
January 1, 1988, between the parties. No change, alteration or modification
hereof may be made except in a writing, signed by each of the parties hereto.
The headings in this Agreement are for convenience of reference only and shall
not be construed as part of this Agreement or to limit or otherwise affect the
meaning hereof.

                                       16

<PAGE>




         IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.

Attest:                                      HOUSEHOLD INTERNATIONAL, INC.


/s/ K. H. Robin                              By: /s/ W.F. Aldinger
-------------------------------                 --------------------------------
Kenneth H. Robin                             Title: Chairman and Chief Executive
Senior Vice President-General Counsel               Officer
and Corporate Secretary
                                             /s/ D. A. Schoenholz
                                             --------------------------------
                                             David A. Schoenholz



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