Document:

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________________________________________________________________________________

               WILMINGTON TRUST COMPANY, AS OWNER TRUSTEE OF THE
            HOUSEHOLD PRIVATE LABEL CREDIT CARD MASTER NOTE TRUST I

                                     Issuer

                                      and

                          HOUSEHOLD FINANCE CORPORATION

                                  Administrator

                            ADMINISTRATION AGREEMENT

                           Dated as of ________, 2001

________________________________________________________________________________

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                                Table of Contents

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SECTION 1.   DUTIES OF ADMINISTRATOR...............................................................2

SECTION 2.   RECORDS...............................................................................6

SECTION 3.   COMPENSATION..........................................................................6

SECTION 4.   ADDITIONAL INFORMATION TO BE FURNISHED TO ISSUER......................................6

SECTION 5.   INDEPENDENCE OF ADMINISTRATOR.........................................................6

SECTION 6.   NO JOINT VENTURE......................................................................6

SECTION 7.   OTHER ACTIVITIES OF ADMINISTRATOR.....................................................7

SECTION 8.   TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR...........................7

SECTION 9.   ACTION UPON TERMINATION, RESIGNATION OR REMOVAL.......................................8

SECTION 10.  NOTICES...............................................................................8

SECTION 11.  AMENDMENTS............................................................................9

SECTION 12.  SUCCESSORS AND ASSIGNS...............................................................10

SECTION 13.  GOVERNING LAW........................................................................10

SECTION 14.  HEADINGS.............................................................................10

SECTION 15.  COUNTERPARTS.........................................................................10

SECTION 16.  SEVERABILITY.........................................................................10

SECTION 17.  NOT APPLICABLE TO HOUSEHOLD FINANCE CORPORATION IN OTHER CAPACITIES..................11

</TABLE>

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<TABLE>
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SECTION 18.  LIMITATION OF LIABILITY OF OWNER TRUSTEE.............................................11

SECTION 19.  THIRD-PARTY BENEFICIARY..............................................................11

SECTION 20.  NONPETITION COVENANTS................................................................11

SECTION 21.  SUCCESSOR ADMINISTRATOR..............................................................11

EXHIBIT A - FORM OF POWER OF ATTORNEY

</TABLE>

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     ADMINISTRATION AGREEMENT dated as of ________, 2001 (the "Administration
Agreement"), between WILMINGTON TRUST COMPANY, not in its individual capacity
but solely as Owner Trustee, on behalf of the HOUSEHOLD PRIVATE LABEL CREDIT
CARD MASTER NOTE TRUST I, a common law trust organized and existing under the
laws of the State of Delaware (herein, the "Issuer"), and HOUSEHOLD FINANCE
CORPORATION, a Delaware corporation ("Household Finance Corporation"), as
administrator (herein, the "Administrator").

                              W I T N E S S E T H:

     WHEREAS the Issuer was formed pursuant to a trust agreement dated as of
____________, 2001 (the "Trust Agreement"), between HRSI Funding, Inc. II and
Wilmington Trust Company, as owner trustee (the "Owner Trustee");

     WHEREAS the Issuer has entered into a Master Indenture, dated as of the
Closing Date (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Indenture"), between the Issuer and
U.S. Bank National Association, a national banking association, as indenture
trustee (the "Indenture Trustee") to provide for the issuance of its asset
backed notes (the "Notes");

     WHEREAS the Issuer has entered into certain agreements in connection with
the issuance of the Notes and of the beneficial ownership interest of the
Issuer, including (i) a Transfer and Servicing Agreement, dated as of the
Closing Date (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Transfer and Servicing Agreement"),
among HRSI Funding, Inc. II, as Transferor (the "Transferor"), Household Finance
Corporation, as Servicer (in such capacity, the "Servicer"), and the Issuer, and
(ii) the Indenture (the Transfer and Servicing Agreement, the Trust Agreement
and the Indenture being hereinafter referred to collectively as the "Related
Agreements") (capitalized terms used herein and not defined herein shall have
the meanings assigned to such terms in the Transfer and Servicing Agreement, or
if not defined therein, in the Indenture);

     WHEREAS pursuant to the Related Agreements, the Issuer and the Owner
Trustee are required to perform certain duties in connection with (a) the Notes
and the collateral therefor pledged pursuant to the Indenture (the "Collateral")
and (b) the beneficial ownership interest in the Issuer (the holder of such
interest being referred to herein as the "Owner");

     WHEREAS the Issuer and the Owner Trustee desire to have the Administrator
perform certain of the duties of the Issuer and the Owner Trustee referred to in
the preceding clause, and to provide such additional services consistent with
the terms of this Agreement and the Related Agreements as the Issuer and the
Owner Trustee may from time to time request;

     WHEREAS the Administrator has the capacity to provide the services required
hereby and is willing to perform such services for the Issuer and the Owner
Trustee on the terms set forth herein;

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     NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties agree as follows:

     Section 1.  Duties of Administrator.

     (a)  Duties with Respect to the Related Agreements.

          (i) The Administrator shall consult with the Owner Trustee regarding
     the duties of the Issuer and the Owner Trustee under the Related
     Agreements. The Administrator shall monitor the performance of the Issuer
     and shall advise the Owner Trustee when action is necessary to comply with
     the Issuer's or the Owner Trustee's duties under the Related Agreements.
     The Administrator shall prepare for execution by the Issuer or the Owner
     Trustee or shall cause the preparation by other appropriate persons of all
     such documents, reports, filings, instruments, certificates and opinions as
     it shall be the duty of the Issuer or the Owner Trustee to prepare, file or
     deliver pursuant to any Related Agreement. In furtherance of the foregoing,
     the Administrator shall take all appropriate action that it is the duty of
     the Issuer or the Owner Trustee to take pursuant to the Indenture
     including, without limitation, such of the foregoing as are required with
     respect to the following matters under the Indenture (references are to
     sections of the Indenture):

               (1) the preparation of or obtaining of the documents and
          instruments required for authentication of the Notes, if any, and
          delivery of the same to the Indenture Trustee (Section 2.03);

               (2) the duty to cause the Note Register to be kept and to give
          the Indenture Trustee notice of any appointment of a new Registrar
          and the location, or change in location, of the Note Register
          (Section 2.05);

               (3) the furnishing of the Indenture Trustee, the Servicer, any
          Noteholder or the Paying Agent with the names and addresses of
          Noteholders after receipt of a written request therefor from the
          Indenture Trustee, the Servicer, any Noteholder or the Paying Agent,
          respectively (Section 2.09(a));

               (4) the preparation, obtaining or filing of the instruments,
          opinions and certificates and other documents required for the release
          of collateral (Section 2.11);

               (5) the duty to cause newly appointed Paying Agents, if any, to
          deliver to the Indenture Trustee the instrument specified in the
          Indenture regarding funds held in trust (Section 3.03);

               (6) the direction to Paying Agents to pay to the Indenture
          Trustee all sums held in trust by such Paying Agents (Section 3.03);

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               (7) the obtaining and preservation of the Issuer's qualification
          to do business in each jurisdiction in which such qualification is or
          shall be necessary to protect the validity and enforceability of the
          Indenture, the Notes, the Collateral and each other instrument and
          agreement (Section 3.04);

               (8) the preparation of all supplements, amendments, financing
          statements, continuation statements, if any, instruments of further
          assurance and other instruments necessary to protect the Collateral
          (Section 3.05);

               (9) the obtaining of the Opinion of Counsel on the Closing Date
          and the annual delivery of Opinions of Counsel as to the Collateral,
          and the annual delivery of the Officers' Certificate and certain other
          statements as to compliance with the Indenture (Sections 3.06 and
          3.09);

               (10) the identification to the Indenture Trustee in an Officer's
          Certificate of a Person with whom the Issuer has contracted to perform
          its duties under the Indenture (Section 3.07(b));

               (11) the delivery of notice to the Indenture Trustee of the
          occurrence of any Servicer Default of which the Issuer has knowledge
          and the action, if any, the Issuer is taking in connection with such
          default (Section 3.07(d));

               (12) the delivery to the Indenture Trustee, within 120 days after
          the end of each fiscal year of the Issuer of an Officer's Certificate
          with respect to various matters relating to compliance with the
          Indenture (Section 3.09);

               (13) the preparation and obtaining of documents and instruments
          required for the release of the Issuer from its obligation under the
          Indenture (Section 3.10);

               (14) the delivery of notice to the Indenture Trustee of each
          Event of Default and each default by the Servicer or the Transferor
          under the Transfer and Servicing Agreement (Section 3.19);

               (15) the monitoring of the Issuer's obligations as to the
          satisfaction and discharge of the Indenture and the preparation of an
          Officer's Certificate and the obtaining of the Opinion of Counsel and
          the Independent Certificate relating thereto (Section 4.01);

               (16) the compliance with any written directive of the Indenture
          Trustee with respect to the sale of the Collateral in a commercially
          reasonable manner if an Event of Default specified in clause (a) or
          (b) of Section 5.02 of the Indenture shall have occurred and be
          continuing (Section 5.05);

                                       3

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               (17) the preparation of any written instruments required to
          confirm more fully the authority of any co-trustee or separate trustee
          and any written instruments necessary in connection with the
          resignation or removal of any co-trustee or separate trustee
          (Sections 6.08 and 6.10);

               (18) the preparation of an Issuer Request and Officers'
          Certificate and the obtaining of an Opinion of Counsel and Independent
          Certificates, if necessary, for the release of the Collateral
          (Section 8.09);

               (19) the preparation of Issuer Orders and the obtaining of
          Opinions of Counsel with respect to the execution of supplemental
          indentures and the mailing to the Noteholders of notices with respect
          to such supplemental indentures (Sections 10.01, 10.02 and 10.03);

               (20) the execution of new Notes conforming to any supplemental
          indenture (Section 10.06);

               (21) the preparation of all Officers' Certificates, Opinions of
          Counsel and Independent Certificates with respect to any requests by
          the Issuer to the Indenture Trustee to take any action under the
          Indenture (Section 12.01(a));

               (22) the preparation and delivery of Officers' Certificates and
          the obtaining of Independent Certificates, if necessary, for the
          release of property from the lien of the Indenture (Section 12.01(b));

               (23) the notification of each Rating Agency of the information
          required pursuant to Section 12.05 of the Indenture (Section 12.05);

               (24) the preparation and delivery to Noteholders and the
          Indenture Trustee of any agreements with respect to alternate payment
          and notice provisions (Section 12.06); and

               (25) compliance with the administrative provisions of the
          Transfer and Servicing Agreement.

     (b)  Additional Duties.

          (i)  In addition to the duties of the Administrator set forth above,
     the Administrator shall perform all duties and obligations of the Issuer
     under the Related Agreements and shall perform such calculations and shall
     prepare for execution by the Issuer and shall cause the preparation by
     other appropriate persons of all such documents, reports, filings,
     instruments, certificates and opinions as it shall be the duty of the
     Issuer or the Owner Trustee to prepare, file or deliver pursuant to the
     Related Agreements, and at the request of the Issuer shall take all
     appropriate action that it is the duty of the Issuer or the Owner Trustee
     to take pursuant to the Related Agreements. Subject to Sections 1(c)(ii)
     and 5 of this Agreement, and in accordance with the directions of the
     Issuer, the Administrator

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<PAGE>   8
     shall administer, perform or supervise the performance of such other
     activities in connection with the Collateral (including the Related
     Agreements) as are not covered by any of the foregoing provisions and as
     are expressly requested by the Owner Trustee and are reasonably within the
     capability of the Administrator.

          (ii) The Administrator shall perform the duties of the Administrator
     specified in Section 9.02 of the Trust Agreement required to be performed
     in connection with the resignation or removal of the Owner Trustee, and any
     other duties expressly required to be performed by the Administrator under
     the Trust Agreement.

          (iii) In carrying out the foregoing duties or any of its other
     obligations under this Agreement, the Administrator may enter into
     transactions with or otherwise deal with any of its Affiliates; provided,
     however, that the terms of any such transactions or dealings shall be in
     accordance with any directions received from the Issuer and shall be, in
     the Administrator's opinion, no less favorable to the Issuer than would be
     available from unaffiliated parties.

          (iv) It is the intention of the parties hereto that the Administrator
     shall, and the Administrator hereby agrees to, prepare, file and deliver on
     behalf of the Issuer all such documents, reports, filings, instruments,
     certificates and opinions as it shall be the duty of the Issuer to prepare,
     file or deliver pursuant to the Related Agreements. In furtherance thereof,
     the Owner Trustee shall, on behalf of the Issuer, execute and deliver to
     the Administrator and its agents, and to each successor Administrator
     appointed pursuant to the terms hereof, one or more powers of attorney
     substantially in the form of Exhibit A hereto, appointing the Administrator
     the attorney-in-fact of the Issuer for the purpose of executing on behalf
     of the Issuer all such documents, reports, filings, instruments,
     certificates and opinions.

     (c)  Non-Ministerial Matters.

          (i)  With respect to matters that in the reasonable judgment of the
     Administrator are non-ministerial, the Administrator shall not take any
     action unless within a reasonable time before the taking of such action,
     the Administrator shall have notified the Transferor of the proposed action
     and the Transferor shall not have withheld consent or provided an
     alternative direction. For the purpose of the preceding sentence,
     "non-ministerial matters" shall include, without limitation:

               (1)  the amendment of or any supplement to the Indenture;

               (2)  the initiation of any claim or lawsuit by the Issuer and the
          compromise of any action, claim or lawsuit brought by or against the
          Issuer (other than in connection with the collection or enforcement of
          the Collateral);

               (3)  the amendment, change or modification of the Related
          Agreements;

                                       5

<PAGE>   9
               (4)  the appointment of successor Registrars, successor Paying
          Agents and successor Indenture Trustees pursuant to the Indenture or
          the appointment of successor Administrators, or the consent to the
          assignment by the Registrar, Paying Agent or Indenture Trustee of its
          obligations under the Indenture; and

               (5)  the removal of the Indenture Trustee.

          (ii) Notwithstanding anything to the contrary in this Agreement, the
     Administrator shall not be obligated to, and shall not, (A) make any
     payments from its own funds to the Noteholders or the Owner under the
     Related Agreements, (B) sell the Collateral pursuant to Section 5.05 of the
     Indenture other than pursuant to a written directive of the Indenture
     Trustee or (C) take any other action that the Issuer directs the
     Administrator not to take on its behalf.

     Section 2.  Records.  The Administrator shall maintain appropriate books of
account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer, the Owner
Trustee, the Indenture Trustee, the Servicer and the Transferor at any time
during normal business hours.

     Section 3.  Compensation.  As compensation for the performance of the
Administrator's obligations under this Agreement, the Administrator shall be
entitled to the amount agreed from time to time with the Owner Trustee which
shall be payable in accordance with the applicable Indenture Supplement. The
Transferor shall be responsible for payment of the Administrator's fees (to the
extent not paid pursuant to the applicable Indenture Supplement) and shall
reimburse the Administrator for any of its liabilities and extra out-of-pocket
expenses related to its performance hereunder or under any Related Document
(including without limitation those expenses set forth in Section 1(a)(ii) of
this Agreement).

     Section 4.  Additional Information to be Furnished to Issuer.  The
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.

     Section 5.  Independence of Administrator.  For all purposes of this
Agreement, the Administrator shall be an independent contractor and shall not be
subject to the supervision of the Issuer or the Owner Trustee with respect to
the manner in which it accomplishes the performance of its obligations
hereunder. Unless expressly authorized by the Issuer, the Administrator shall
have no authority to act for or represent the Issuer or the Owner Trustee in any
way and shall not otherwise be deemed an agent of the Issuer or the Owner
Trustee.

     Section 6.  No Joint Venture.  Nothing contained in this Agreement shall
(a) constitute the Administrator and either of the Issuer or the Owner Trustee
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (b) be construed to impose any
liability as such on any of them or

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<PAGE>   10
(c) be deemed to confer on any of them any express, implied or apparent
authority to incur any obligation or liability on behalf of the others.

     Section 7.  Other Activities of Administrator.  Nothing herein shall
prevent the Administrator or its affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.

     Section 8.  Term of Agreement; Resignation and Removal of Administrator.

     (a)  This Agreement shall continue in force until the termination of the
Issuer, upon which event this Agreement shall automatically terminate.

     (b)  Subject to Section 8(e) and (f), the Administrator may resign its
duties hereunder by providing the Issuer with at least 60 days prior written
notice.

     (c)  Subject to Section 8(e) and (f), the Issuer may remove the
Administrator without cause by providing the Administrator with at least 60 days
prior written notice.

     (d)  Subject to Section 8(e) and (f), at the sole option of the Issuer, the
Administrator may be removed immediately upon written notice of termination from
the Issuer to the Administrator if any of the following events shall occur:

          (i)    the Administrator shall default in the performance of any of
     its duties under this Agreement and, after notice of such default, shall
     not cure such default within 30 days (or, if such default cannot be cured
     in such time, shall not give within 30 days such assurance of cure as shall
     be reasonably satisfactory to the Issuer);

          (ii)   a court having jurisdiction in the premises shall enter a
     decree or order for relief, and such decree or order shall not have been
     vacated within 60 days, in respect of the Administrator in any involuntary
     case under any applicable bankruptcy, insolvency or other similar law now
     or hereafter in effect or appoint a receiver, conservator, liquidator,
     assignee, custodian, trustee, sequestrator or similar official for the
     Administrator or any substantial part of its property or order the
     winding-up or liquidation of its affairs; or

          (iii)  the Administrator shall commence a voluntary case under any
     applicable bankruptcy, insolvency or other similar law now or hereafter in
     effect, shall consent to the entry of an order for relief in an involuntary
     case under any such law, or shall consent to the appointment of a receiver,
     conservator, liquidator, assignee, trustee, custodian, sequestrator or
     similar official for the Administrator or any substantial part of its
     property, shall consent to the taking of possession by any such official of
     any substantial part of its property, shall make any general assignment for
     the benefit of creditors, shall admit in writing its inability to pay its

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     debts generally as they become due or shall fail generally to pay its debts
     as they become due.

     The Administrator agrees that if any of the events specified in clause (ii)
or (iii) of this Section 8(d) shall occur, it shall give written notice thereof
to the Issuer and the Indenture Trustee within seven days after the happening of
such event.

     (e)  No resignation or removal of the Administrator pursuant to this
Section 8 shall be effective until (i) a successor Administrator shall have been
appointed by the Issuer and (ii) such successor Administrator shall have agreed
in writing to be bound by the terms of this Agreement in the same manner as the
Administrator is bound hereunder.

     (f)  The appointment of any successor Administrator shall be effective only
after satisfaction of the Rating Agency Condition with respect to the proposed
appointment.

     Section 9.  Action upon Termination, Resignation or Removal.  Promptly upon
the effective date of termination of this Agreement pursuant to Section 8(a) or
the resignation or removal of the Administrator pursuant to Section 8(b), (c) or
(d) respectively, the Administrator shall be entitled to be paid all fees and
reimbursable expenses accruing to it to the date of such termination,
resignation or removal. The Administrator shall forthwith upon such termination
pursuant to Section 8(a) deliver to the Issuer all property and documents of or
relating to the Collateral then in the custody of the Administrator. In the
event of the resignation or removal of the Administrator pursuant to Section
8(b), (c) or (d), respectively, the Administrator shall cooperate with the
Issuer and take all reasonable steps requested to assist the Issuer in making an
orderly transfer of the duties of the Administrator.

     Section 10.  Notices.  Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:

     (a)  if to the Issuer or the Owner Trustee, to

     Household Private Label Credit Card Master Note Trust I
     c/o Wilmington Trust Company
     Rodney Square North
     1100 North Market Street--
     Wilmington, DE 19890-0001
     Telephone: 302-651-8856

     (b)  if to the Transferor, to

     HRSI Funding, Inc. II
     2700 Sanders Road
     Prospect Heights, Illinois 60070
     Telephone: 847-564-6223

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     (c)  if to the Administrator, to

     Household Finance Corporation
     2700 Sanders Road
     Prospect Heights, Illinois 60070
     Telephone:  847-564-5000

     (d)  if to the Indenture Trustee, to

     U.S. Bank National Association
     111 East Wacker Drive
     Chicago, Illinois 60601
     Attention: Corporate Trust Department
     Telephone: (312) 228-9400

or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above, except that notices to the
Indenture Trustee are effective only upon receipt.

     Section 11.  Amendments.  This Agreement may be amended from time to time,
by a written amendment duly executed and delivered by the Issuer, the
Administrator and the Transferor, with the written consent of the Owner Trustee,
without the consent of any of the Noteholders or the Owner, (i) to cure any
ambiguity, (ii) to correct or supplement any provisions herein which may be
inconsistent with any other provisions herein, (iii) to add any other provisions
with respect to matters or questions arising under this Agreement which shall
not be inconsistent with the provisions of this Agreement, (iv) to change,
modify, delete or add any other obligation of the Issuer and the Administrator;
provided, however, the Issuer and the Administrator shall have delivered to the
Indenture Trustee an Officer's Certificate, dated the date of any such action,
stating that each of the Issuer and the Administrator reasonably believes that
such action will not have an Adverse Effect, unless the Owner Trustee and the
Indenture Trustee shall consent thereto.

     This Agreement may also be amended from time to time, by a written
amendment duly executed and delivered by the Issuer, the Administrator and the
Transferor, with the written consent of the Owner Trustee, the holders of Notes
evidencing not less than a majority in the Outstanding Amount of the Notes and
the Owner, for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Agreement or modifying in any
manner the rights of Noteholders or the Owner; provided, however, that, without
the consent of the Holders of all of the Notes then outstanding, no such
amendment shall (a) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, collections of payments on the Receivables or
distributions that are required to be made for the benefit of the Noteholders or
(b) reduce the aforesaid portion of the Outstanding Amount of the Notes, the
Holders of which are required to consent to any such amendment.

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     Prior to the execution of any such amendment or consent, the Administrator
shall furnish written notification of the substance of such amendment or consent
to each Rating Agency. Promptly after the execution of any such amendment or
consent, the Administrator shall furnish written notification of the substance
of such amendment or consent to the Indenture Trustee.

     It shall not be necessary for the consent of Noteholders pursuant to this
Section 11 to approve the particular form of any proposed amendment or consent,
but it shall be sufficient if such consent shall approve the substance thereof.

     Section 12.  Successors and Assigns.  This Agreement may not be assigned by
the Administrator unless such assignment is previously consented to in writing
by the Issuer, the Transferor and the Owner Trustee and subject to the
satisfaction of the Rating Agency Condition in respect thereof. An assignment
with such consent and satisfaction, if accepted by the assignee, shall bind the
assignee hereunder in the same manner as the Administrator is bound hereunder.
Notwithstanding the foregoing, this Agreement may be assigned by the
Administrator without the consent of the Issuer, the Transferor, the Owner
Trustee or the Rating Agencies to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the Administrator,
provided that such successor organization executes and delivers to the Issuer,
the Transferor and the Owner Trustee an agreement in which such corporation or
other organization agrees to be bound hereunder by the terms of said assignment
in the same manner as the Administrator is bound hereunder. Subject to the
foregoing, this Agreement shall bind any successors or assigns of the parties
hereto.

     Section 13.  GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

     Section 14.  Headings.  The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.

     Section 15.  Counterparts.  This Agreement may be executed in counterparts,
each of which when so executed shall together constitute but one and the same
agreement.

     Section 16.  Severability.  Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

                                       10

<PAGE>   14
     Section 17.  Not Applicable to Household Finance Corporation in Other
Capacities.  Nothing in this Agreement shall affect any obligation Household
Finance Corporation may have in any other capacity.

     Section 18.  Limitation of Liability of Owner Trustee.  Notwithstanding
anything contained herein to the contrary, this instrument has been signed by
Wilmington Trust Company not in its individual capacity but solely in its
capacity as Owner Trustee of the Issuer and in no event shall Wilmington Trust
Company in its individual capacity or any beneficial owner of the Issuer have
any liability for the representations, warranties, covenants, agreements or
other obligations of the Issuer hereunder, as to all of which recourse shall be
had solely to the assets of the Issuer. For all purposes of this Agreement, in
the performance of any duties or obligations of the Issuer hereunder, the Owner
Trustee shall be subject to, and entitled to the benefits of, the terms and
provisions of Articles IV, V, VI and VII of the Trust Agreement.

     Section 19.  Third-Party Beneficiary.  The Owner Trustee is a third-party
beneficiary to this Agreement and is entitled to the rights and benefits
hereunder and may enforce the provisions hereof as if it were a party hereto.

     Section 20.  Nonpetition Covenants.  Notwithstanding any prior termination
of this Agreement, the Administrator shall not at any time with respect to the
Issuer or the Transferor acquiesce, petition or otherwise invoke or cause the
Issuer or the Transferor to invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against the Issuer
or the Transferor under any Federal or state bankruptcy, insolvency or similar
law or appointing a receiver, conservator, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Issuer or the
Transferor or any substantial part of its property, or ordering the winding up
or liquidation of the affairs of the Issuer or the Transferor; provided,
however, that this Section 20 shall not operate to preclude any remedy described
in Article V of the Indenture.

     Section 21.  Successor Administrator.  In the event of a servicing transfer
pursuant to Article V of the Transfer and Servicing Agreement, the successor
servicer under the Transfer and Servicing Agreement shall, upon the date of such
servicing transfer, become the successor Administrator hereunder.
"Administrator" shall mean initially Household Finance Corporation and
thereafter its permitted successor and assigns as provided in Section 12 or any
successor Administrator as provided in this Section 21.

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<PAGE>   15
     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.

                                       WILMINGTON TRUST COMPANY,
                                       not in its individual capacity but solely
                                       as Owner Trustee on behalf of the
                                       HOUSEHOLD PRIVATE LABEL CREDIT
                                       CARD MASTER NOTE TRUST I

                                       By: _____________________________________
                                           Name:
                                           Title:

                                       HOUSEHOLD FINANCE CORPORATION,
                                       as Administrator,

                                       By: _____________________________________
                                           Name:
                                           Title:

Acknowledged and Accepted:

By: HRSI FUNDING, INC. II,
    Transferor

By: _____________________________________
    Name:
    Title:

<PAGE>   16
                                                                       EXHIBIT A
                                                     [Form of Power of Attorney]

                               POWER OF ATTORNEY

STATE OF DELAWARE     )
                      )
COUNTY OF             )

     KNOW ALL MEN BY THESE PRESENTS, that Household Private Label Credit Card
Master Note Trust I, a Delaware common law trust ("Trust"), does hereby make,
constitute and appoint Household Finance Corporation, as Administrator under the
Administration Agreement (as defined below), and its agents and attorneys, as
Attorneys-in-Fact to execute on behalf of the Trust all such documents, reports,
filings, instruments, certificates and opinions as it shall be the duty of the
Trust to prepare, file or deliver pursuant to the Related Agreements (as defined
in the Administration Agreement), including, without limitation, to appear for
and represent the Trust in connection with the preparation, filing and audit of
federal, state and local tax returns pertaining to the Trust, and with full
power to perform any and all acts associated with such returns and audits that
the Trust could perform, including without limitation, the right to distribute
and receive confidential information, defend and assert positions in response to
audits, initiate and defend litigation, and to execute waivers of restriction on
assessments of deficiencies, consents to the extension of any statutory or
regulatory time limit, and settlements. For the purpose of this Power of
Attorney, the term "Administration Agreement" means the Administration
Agreement, dated as of __________, 2001, between the Trust and Household Finance
Corporation, as Administrator and as such may be amended from time to time.

     This power of attorney is coupled with an interest and shall survive and
not be affected by the subsequent bankruptcy or dissolution of the Trust.

     All powers of attorney for this purpose heretofore filed or executed by the
Trust are hereby revoked.

     EXECUTED this ____ day of __________, 2001

                                       WILMINGTON TRUST COMPANY,
                                       not in its individual capacity but solely
                                       as Owner Trustee on behalf of the
                                       HOUSEHOLD PRIVATE LABEL CREDIT
                                       CARD MASTER NOTE TRUST I

                                       By: _____________________________________
                                           Name:
                                           Title:<PAGE>   1
________________________________________________________________________________

                           HOUSEHOLD BANK (SB), N.A.

                                      and

                   HOUSEHOLD RECEIVABLES ACQUISITION COMPANY

                         RECEIVABLES PURCHASE AGREEMENT

                           Dated as of _______, 2001

________________________________________________________________________________

<PAGE>   2

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                          Page
<S>                                                                       <C>
ARTICLE I DEFINITIONS 1

  Section 1.01.  Definitions..............................................  1
  Section 1.02.  Other Definitional Provisions............................  4

ARTICLE II PURCHASE AND CONVEYANCE OF RECEIVABLES.........................  5

  Section 2.01.  Purchase.................................................  5
  Section 2.02.  Addition of Aggregate Addition Accounts..................  7
  Section 2.03.  Addition of New Accounts.................................  8
  Section 2.04.  Representations and Warranties...........................  9
  Section 2.05.  Delivery of Documents....................................  9

ARTICLE III CONSIDERATION AND PAYMENT.....................................  9

  Section 3.01.  Purchase Price...........................................  9
  Section 3.02.  Adjustments to Purchase Price............................ 10

ARTICLE IV REPRESENTATIONS AND WARRANTIES................................. 10

  Section 4.01.  Representations and Warranties of the Bank
                 Relating to the Bank..................................... 10
  Section 4.02.  Representations and Warranties of the Bank
                 Relating to the Agreement and the Receivables............ 11
  Section 4.03.  Representations and Warranties of HRAC................... 13

ARTICLE V COVENANTS....................................................... 14

  Section 5.01.  Covenants of the Bank.................................... 14

ARTICLE VI REPURCHASE OBLIGATION.......................................... 15

  Section 6.01.  Reassignment of Ineligible Receivables................... 15
  Section 6.02.  Reassignment of Trust Portfolio.......................... 16

ARTICLE VII CONDITIONS PRECEDENT.......................................... 16

  Section 7.01.  Conditions to HRAC's Obligations Regarding
                 Initial Receivables...................................... 16
  Section 7.02.  Conditions Precedent to the Bank's Obligations........... 17

ARTICLE VIII TERM AND PURCHASE TERMINATION................................ 18

  Section 8.01.  Term..................................................... 18
  Section 8.02.  Purchase Termination..................................... 18

ARTICLE IX MISCELLANEOUS PROVISIONS....................................... 18

  Section 9.01.  Amendment................................................ 18
  Section 9.02.  Governing Law............................................ 19

</TABLE>
<PAGE>   3

<TABLE>
<CAPTION>

<S>                                                                   <C>
  Section 9.03.  Notices.................................................. 19
  Section 9.04.  Severability of Provisions............................... 19
  Section 9.05.  Assignment............................................... 19
  Section 9.06.  Acknowledgement and Agreement of the Bank................ 20
  Section 9.07.  Further Assurances....................................... 20
  Section 9.08.  No Waiver; Cumulative Remedies........................... 20
  Section 9.09.  Counterparts............................................. 20
  Section 9.10.  Binding; Third-Party Beneficiaries....................... 21
  Section 9.11.  Merger and Integration................................... 21
  Section 9.12.  Headings................................................. 21
  Section 9.13.  Schedules and Exhibits................................... 21
  Section 9.14.  Survival of Representations and Warranties............... 21
  Section 9.15.  Nonpetition Covenant..................................... 21

EXHIBIT A ................................................................ A-1

FORM OF SUPPLEMENTAL CONVEYANCE .......................................... A-1

Schedule I ............................................................... I-1

LIST OF ACCOUNTS ......................................................... I-2

</TABLE>
<PAGE>   4
     RECEIVABLES PURCHASE AGREEMENT, dated as of ________, 2001 by and between
HOUSEHOLD RECEIVABLES ACQUISITION COMPANY, a Delaware corporation ("HRAC"), and
HOUSEHOLD BANK (SB), N.A., a national banking association (the "Bank").

                              W I T N E S S E T H:

     WHEREAS, HRAC desires to purchase, from time to time, certain Receivables
(hereinafter defined) arising under certain revolving credit accounts owned by
the Bank;

     WHEREAS, the Bank desires to sell and assign from time to time certain
Receivables to HRAC upon the terms and conditions hereinafter set forth;

     WHEREAS, it is contemplated that the Receivables purchased hereunder will
be transferred by HRAC to HRSI Funding, Inc. II then to the Trust (hereinafter
defined) in connection with the issuance of certain Securities (hereinafter
defined); and

     WHEREAS, the Bank agrees that all representations, warranties, covenants
and agreements made by the Bank herein with respect to the Accounts (hereinafter
defined) and Receivables shall also be for the benefit of HRSI Funding, Inc. II,
the Owner Trustee (hereinafter defined), the Indenture Trustee (hereinafter
defined) and all beneficiaries of the Trust, including the holders of the
Securities.

     NOW, THEREFORE, it is hereby agreed by and between HRAC and the Bank as
follows:

                                   ARTICLE I

                                  DEFINITIONS

     Section 1.01.  Definitions.  All capitalized terms used herein or in any
certificate, document, or Conveyance Paper made or delivered pursuant hereto,
and not defined herein or therein, shall have the meaning ascribed thereto in
the Transfer and Servicing Agreement; in addition, the following words and
phrases shall have the following meanings:

     "Account" shall mean (a) each Initial Account, (b) each Additional Account
(but only from and after the Addition Date with respect thereto), (c) each
Related Account, and (d) each account into which an Account shall be transferred
(a "Transferred Account") provided that (i) such transfer was made in accordance
with the Credit Guidelines and (ii) such account can be traced or identified as
an account into which an Account has been transferred, but shall exclude (e) any
Account that (x) after the Removal Date, the newly generated Receivables in
which shall not be assigned to HRAC hereunder, (y) the right, title and interest
of HRAC in the Receivables in which are reassigned to the Bank pursuant to
Section 6.01 or (z) the right, title and interest of the Trust in the
Receivables in which are assigned and transferred to the Servicer pursuant to
Section 3.03 of the Transfer and Servicing Agreement.

<PAGE>   5
     "Account Owner" shall mean the Bank, or any entity which is the issuer of
the revolving credit relating to an Account pursuant to a Credit Agreement
and/or a seller of Receivables to HRAC.

     "Addition Date" shall mean (a) with respect to Aggregate Addition Accounts
(or Participation Interests), the date from and after which such Aggregate
Addition Accounts are to be included as Accounts pursuant to Section 2.02 and
(b) with respect to New Accounts, the first Distribution Date following the
calendar month in which the later of the dates on which such New Accounts are
originated or designated (or such Participation Interests are included) pursuant
to Section 2.03 occurs.

     "Addition Notice Date" shall have the meaning specified in Section 2.02 of
this Agreement.

     "Additional Account" shall mean each New Account and each Aggregate
Addition Account.

     "Additional Cut-Off Date" shall mean (a) with respect to Aggregate Addition
Accounts, the date specified as such in the notice delivered with respect
thereto pursuant to Section 2.02, and (b) with respect to New Accounts, the
later of the dates on which such New Accounts are originated or designated
pursuant to Section 2.03.

     "Aggregate Addition Account" shall mean each Eligible Account that is
designated pursuant to Section 2.02 to be included as an Account and is
identified in the computer file or microfiche list delivered to HRAC by the Bank
pursuant to Sections 2.01 and 2.05.

     "Agreement" shall mean this Receivables Purchase Agreement and all
amendments hereof and supplements hereto.

     "Bank" shall mean Household Bank (SB), N.A., a nationally chartered bank,
and its successors and permitted assigns.

     "Closing Date" shall mean _________, 2001.

     "Company" shall mean HRSI Funding, Inc. II, a Delaware corporation, and its
permitted successors and assigns.

     "Conveyance" shall have the meaning specified in subsection 2.01(a).

     "Conveyance Papers" shall have the meaning specified in subsection 4.01(c).

     "Credit Adjustment" shall have the meaning specified in Section 3.02.

     "Debtor Relief Laws" shall mean (a) the Bankruptcy Code of the United
States of America and (b) all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization,
suspension of payments, readjustment of debt, marshalling of assets or similar
debtor relief laws of the United States, any state or any foreign country from
time to time in effect affecting the rights of creditors generally.

                                       2

<PAGE>   6
     "Eligible Receivable" shall have the meaning set forth in the Transfer and
Servicing Agreement, except that "the Bank" shall be substituted for each
occurrence of "the Transferor," "HRAC" shall be substituted for each occurrence
of "the Owner Trustee," and all references to the Notes shall be ignored.

     "Finance Charge and Administrative Receivables" shall mean all Receivables
in the Accounts which would be treated as "Finance Charge and Administrative
Receivables" in accordance with the definition for such term in the Transfer and
Servicing Agreement.

     "HRAC" shall mean Household Receivables Acquisition Company, a Delaware
corporation, and its successors and permitted assigns.

     "Indenture" shall mean the Master Indenture between the Trust and U.S. Bank
National Association, as Indenture Trustee, dated as of ________, 2001 as
supplemented by Indenture Supplements applicable to any Series that may be
issued from time to time.

     "Indenture Supplement" shall mean the indenture supplement pursuant to
which a Series is issued.

     "Indenture Trustee" shall mean U.S. Bank National Association in its
capacity as indenture trustee, or any successor indenture trustee.

     "Initial Account" shall mean each Account included in the computer file
delivered to the Indenture Trustee as of the Closing Date.

     "Insolvency Event" shall have the meaning specified in Section 8.02.

     "New Account" shall mean each revolving credit account established pursuant
to a Credit Agreement, which account is designated pursuant to Section 2.03 to
be included as an Account and is identified in the computer file or microfiche
list delivered to HRAC by the Bank pursuant to Sections 2.01 and 2.05.

     "New Principal Receivables" shall have the meaning set forth in
Section 3.01.

     "Obligor" shall mean, with respect to each Account, each person that would
be treated as an "Obligor" in accordance with the definition for such term in
the Transfer and Servicing Agreement.

     "Owner Trustee" shall mean Wilmington Trust Company, a Delaware banking
corporation the institution executing the Trust Agreement as and acting in the
capacity of Owner Trustee thereunder, or its successor in interest, or any
successor trustee appointed as provided in the Trust Agreement.

     "Principal Receivables" shall mean all Receivables other than Finance
Charge and Administrative Receivables.

     "Purchase Price" shall have the meaning set forth in Section 3.01.

                                       3

<PAGE>   7
     "Purchased Assets" shall have the meaning set forth in Section 2.01.

     "Receivables" shall mean all amounts shown on the Bank's records as amounts
payable by Obligors on any Account from time to time, including amounts payable
for Principal Receivables and Finance Charge and Administrative Receivables.
Receivables that become Defaulted Receivables will cease to be included as
Receivables as of the day on which they become Defaulted Receivables.

     "Removed Account" shall mean an Account hereunder that is a "Removed
Account" (as such term is defined in the Transfer and Servicing Agreement) that
is designated for removal pursuant to Section 2.10 of the Transfer and
Servicing Agreement.

     "Securities" shall mean any one of the Notes (as such term is defined in
the Indenture) or the Transferor Certificates.

     "Servicer" shall mean Household Finance Corporation, in its capacity as
Servicer pursuant to the Transfer and Servicing Agreement and, after any
Service Transfer, the Successor Servicer.

     "Supplemental Conveyance" shall have the meaning set forth in Section 2.05.

     "Transfer and Servicing Agreement" shall mean the Transfer and Servicing
Agreement, dated as of _______, 2001 among Household Finance Corporation, as
Servicer, the Company, as Transferor, and the Owner Trustee on behalf of the
Trust, and all amendments and supplements thereto.

     "Transferor RPA" shall mean the Receivables Purchase Agreement, dated
______, 2001, between HRAC and the Company.

     "Trust" shall mean the Household Private Label Credit Card Master Note
Trust I, acting by and through Wilmington Trust Company, not in its individual
capacity but solely as Owner Trustee.

     "Trust Agreement" shall mean the Household Private Label Credit Card Master
Note Trust I Trust Agreement, dated as of _____, 2001 between the Company, as
Transferor, and the Owner Trustee on behalf of the Trust.

     "Trust Collateral" shall have the meaning set forth in Section 2.01.

     Section 1.02.  Other Definitional Provisions.

     All terms defined in this Agreement shall have the defined meanings when
used in any certificate, other document, or Conveyance Paper made or delivered
pursuant hereto unless otherwise defined therein.

     The words "hereof," "herein" and "hereunder" and words of similar import
when used in this Agreement or any Conveyance Paper shall refer to this
Agreement as a whole and not to any particular provision of this Agreement;
and Section, Subsection, Schedule and Exhibit

                                       4

<PAGE>   8
references contained in this Agreement are references to Sections, Subsections,
Schedules and Exhibits in or to this Agreement unless otherwise specified.

     All determinations of the principal or finance charge balance of
Receivables, and of any collections thereof, shall be made in accordance with
the Transfer and Servicing Agreement and the Indenture.

     All capitalized terms used herein and not otherwise defined herein have the
meanings ascribed to them in the Indenture or the Transfer and Servicing
Agreement.

                                   ARTICLE II

                     PURCHASE AND CONVEYANCE OF RECEIVABLES

     Section 2.01.  Purchase.

     (a)  By execution of this Agreement, the Bank does hereby sell, transfer,
assign, set over and otherwise convey to HRAC (collectively, the "Conveyance"),
without recourse except as provided herein, all its right, title and interest
in, to and under the Receivables existing at the close of business on the
Closing Date, in the case of Receivables arising in the Initial Accounts, and on
each Additional Cut-Off Date, in the case of Receivables arising in the
Additional Accounts and the Participation Interests conveyed pursuant to a
Participation Interest Supplement, and in each case thereafter created from time
to time until the termination of this Agreement pursuant to Article VIII hereof,
all Recoveries with respect to such Accounts and all such Participation
Interests, all monies due or to become due and all amounts received or
receivable with respect thereto, and all proceeds (including, without
limitation, "proceeds" as defined in the UCC) thereof (the "Purchased Assets").

     (b)  In connection with such Conveyance, the Bank agrees (i) to record and
file, at its own expense, any financing statements (and continuation statements
with respect to such financing statements when applicable) with respect to the
Receivables existing at the close of business on the Closing Date and thereafter
created in the Initial Accounts and existing as of the Additional Cut-Off Date
and thereafter created in the Additional Accounts and the Participation
Interests conveyed pursuant to a Participation Interest Supplement, meeting the
requirements of applicable state law in such manner and in such jurisdictions as
are necessary to perfect, and maintain perfection of, the Conveyance of such
Receivables and all such Participation Interests from the Bank to HRAC,
(ii) that such financing statements shall name the Bank, as seller, and HRAC,
as purchaser, of the Receivables and all such Participation Interests and
(iii) to deliver a file-stamped copy of such financing statements or other
evidence of such filings (excluding such continuation statements, which shall be
delivered as filed) to HRAC as soon as is practicable after filing.

     (c)  In connection with each such Conveyance, the Bank further agrees that
it will, at its own expense, (i) on or prior to (A) the Closing Date, in the
case of Initial Accounts, (B) the applicable Addition Date, in the case of
Additional Accounts, and (C) the applicable Removal Date, in the case of Removed
Accounts, indicate in its computer files that, in the case of the Initial
Accounts or the Additional Accounts, Receivables created in connection with
such Accounts have

                                       5

<PAGE>   9
been conveyed to HRAC in accordance with this Agreement and have been conveyed
by HRAC to the Company in accordance with the Transferor RPA and have been
conveyed by the Company to the Trust pursuant to the Transfer and Servicing
Agreement and have been pledged by the Trust to the Indenture Trustee pursuant
to the Indenture for the benefit of the Noteholders by including (or deleting,
in the case of newly originated Receivables in Removed Accounts) in such
computer files the code that identifies each such Account and (ii) on or prior
to (A) the Closing Date, in the case of the Initial Accounts, (B) the date that
is five Business Days after the applicable Addition Date, in the case of
designation of Aggregate Addition Accounts, (C) the date that is 30 days after
the applicable Addition Date, in the case of New Accounts, and (D) the date that
is five Business Days after the applicable Removal Date, in the case of Removed
Accounts, to deliver to HRAC, or its designee, a computer file or microfiche
list containing a true and complete list of all such Accounts specifying for
each such Account, as of the Closing Date, in the case of the Initial Accounts,
the applicable Additional Cut-Off Date, in the case of Additional Accounts, and
the applicable Removal Date, in the case of Removed Accounts, (1) its account
number, (2) the aggregate amount outstanding in such Account and (3) the
aggregate amount of Principal Receivables in such Account. Each such computer
file or microfiche list, as supplemented from time to time to reflect Additional
Accounts or Removed Accounts, shall be marked as Schedule I to this Agreement,
shall be delivered to HRAC, or its designee, and is hereby incorporated into and
made a part of this Agreement. The Bank further agrees not to alter the code
referenced in clause (i) of this paragraph with respect to any Account during
the term of this Agreement unless and until such Account becomes a Removed
Account.

     (d)  The parties hereto intend that the conveyance of the Bank's right,
title and interest in and to the Purchased Assets shall constitute an absolute
sale, conveying good title free and clear of any liens, claims, encumbrances or
rights of others from the Bank to HRAC and that the Purchased Assets shall not
be part of the Bank's estate in the event of the insolvency of the Bank or a
conservatorship, receivership or similar event with respect to the Bank. It is
the intention of the parties hereto that the arrangements with respect to the
Purchased Assets shall constitute a purchase and sale of such Purchased Assets
and not a loan or a borrowing secured by such Purchased Assets. In the event,
however, that it were to be determined that the transactions evidenced hereby
constitute a loan and not a purchase and sale, it is the intention of the
parties hereto that this Agreement shall constitute a security agreement under
applicable law, and that the Bank shall be deemed to have granted and does
hereby grant to HRAC a first priority perfected security interest in all of the
Bank's right, title and interest, whether now owned or hereafter acquired, in,
to and under the Receivables and other Purchased Assets to secure the
obligations of the Bank hereunder.

     (e)  To the extent that the Bank retains any interest in the Purchased
Assets, the Bank hereby grants to the Indenture Trustee for the benefit of the
Noteholders a security interest in all of the Bank's right, title, and interest,
whether now owned or hereafter acquired, in, to, and under the Receivables and
other Purchased Assets that are intended to be pledged to the Indenture Trustee
pursuant to the Indenture (collectively, the "Trust Collateral"), to secure the
performance of all of the obligations of the Bank under this Agreement and any
other agreement or document related to the Transfer and Servicing Agreement or
the Indenture. With respect to the Trust Collateral, the Indenture Trustee shall
have all of the rights that it has under the Transfer and Servicing Agreement
and the Indenture and all of the rights of a secured creditor under the UCC.

                                       6

<PAGE>   10
     Section 2.02.  Addition of Aggregate Addition Accounts.

     (a)  If, from time to time, the Company becomes obligated to designate
Aggregate Addition Accounts (as such term is defined in the Transfer and
Servicing Agreement) pursuant to subsection 2.09(a) of the Transfer and
Servicing Agreement, then HRAC may, at its option, give the Bank written notice
thereof on or before the fifth Business Day (the "Addition Notice Date") prior
to the Addition Date therefor, and upon receipt of such notice the Bank shall on
or before the Addition Date, designate sufficient Eligible Accounts to be
included as Additional Accounts so that after the inclusion thereof HRAC will be
in compliance with the requirements of said subsection 2.09(a). Additionally,
subject to subsections 2.09(b) and (c) of the Transfer and Servicing Agreement
and subsection 2.02(b), from time to time Eligible Accounts may be designated to
be included as Aggregate Addition Accounts, upon the mutual agreement of the
Company, HRAC and the Bank. In either event, the Bank shall have sole
responsibility for selecting the Aggregate Addition Accounts.

     (b)  On the Addition Date with respect to any designation of Aggregate
Addition Accounts, HRAC shall purchase the Bank's right, title and interest in,
to and under the Receivables in Aggregate Addition Accounts (and such Aggregate
Addition Accounts shall be deemed to be Accounts for purposes of this Agreement)
and the related Purchased Assets, subject to the satisfaction of the following
conditions on such Addition Date:

          (i)    all Aggregate Addition Accounts shall be Eligible Accounts;

          (ii)   the Bank shall have delivered to HRAC copies of UCC-1 financing
     statements covering such Aggregate Addition Accounts or Participation
     Interests, if necessary to perfect the HRAC's undivided interest in the
     Receivables arising therein;

          (iii)  to the extent required of the Company by Section 2.09(c) of the
     Transfer and Servicing Agreement, the Bank shall have deposited in the
     Collection Account (as such term is defined in the Indenture) all
     Collections with respect to such Aggregate Addition Accounts or
     Participation Interests since the Additional Cut-Off Date;

          (iv)   as of each of the Additional Cut-Off Date and the Addition
     Date, no Insolvency Event with respect to the Bank or other Account Owner,
     as the case may be, shall have occurred nor shall the transfer of the
     Receivables arising in the Aggregate Addition Accounts or Participation
     Interests to HRAC have been made in contemplation of the occurrence
     thereof;

          (v)    solely with respect to Aggregate Addition Accounts designated
     pursuant to the second  sentence  of  subsection  2.02(a),  the Rating
     Agency Condition shall have been satisfied;

          (vi)   the Bank shall have delivered to HRAC, or its designee, an
     Officer's Certificate, dated the Addition Date, confirming, to the extent
     applicable, the items set forth in clauses (i) through (v) above; and

          (vii)  the transfer of the Receivables arising in the Aggregate
     Addition Accounts or Participation Interests to HRAC will not result in an
     Adverse Effect and the

                                       7

<PAGE>   11
     Bank shall have delivered to HRAC, or its designee, an Officer's
     Certificate, dated the Addition Date, stating that the Bank reasonably
     believes that the addition of the Receivables arising in the Aggregate
     Addition Accounts or Participation Interests to HRAC will not have an
     Adverse Effect.

     Section 2.03.  Addition of New Accounts.

     (a)  Upon the mutual agreement of the Company, HRAC and the Bank, subject
to compliance with the conditions specified in subsections 2.09(d) and (e) of
the Transfer and Servicing Agreement and compliance with subsection 2.03(b), the
Bank may designate newly originated Eligible Accounts to be included as New
Accounts. Upon such designation, such New Accounts shall be deemed to be
Accounts hereunder. The Bank shall cooperate with the Company and HRAC to enable
the Company to comply with the requirements of Section 2.09 of the Transfer and
Servicing Agreement and shall cooperate with the Company and HRAC to enable the
Company to perform with respect to the Receivables in such New Accounts all
actions specified in subsections 2.09(d) and (e) of the Transfer and Servicing
Agreement.

     (b)  On the Addition Date with respect to any New Accounts, HRAC shall
purchase the Bank's right, title and interest in, to and under the Receivables
in New Accounts (and such New Accounts shall be deemed to be Accounts for
purposes of this Agreement) as of the close of business on the applicable
Additional Cut-Off Date and the related Purchased Assets, subject to the
satisfaction of the following conditions on such Addition Date:

          (i)    all New Accounts shall be Eligible Accounts;

          (ii)   the Bank shall have delivered to HRAC, or its designee, copies
     of UCC-1 financing statements covering such New Accounts, if necessary to
     perfect HRAC's interest in the Receivables arising therein;

          (iii)  to the extent required of the Company by Section 2.09(e) of the
     Transfer and Servicing Agreement, the Bank shall have deposited in the
     Collection Account all Collections with respect to such New Accounts since
     the Additional Cut-Off Date;

          (iv)   as of each of the Additional Cut-Off Date and the Addition
     Date, no Insolvency Event with respect to the Bank or other Account Owner,
    as applicable, shall have occurred nor shall the transfer of the Receivables
    arising in the New Accounts to HRAC have been made in contemplation of the
    occurrence thereof;

          (v)    the Bank shall have delivered to HRAC, or its designee, an
     officer's certificate, dated the Addition Date, confirming, to the extent
     applicable, the items set forth in clauses (ii) through (iv) above; and

          (vi)   the transfer of the Receivables arising in the New Accounts to
     HRAC will not result in an Adverse Effect, and the Bank shall have
     delivered to HRAC, or its designee, an officer's certificate, dated the
     Addition Date, stating that the Bank reasonably believes that the addition
     to the Trust of the Receivables arising in the New Accounts will not have
     an Adverse Effect.

                                       8

<PAGE>   12
     Section 2.04.  Representations and Warranties.  The Bank hereby represents
and warrants to HRAC as of the related Addition Date as to the matters set forth
in subsections 2.02(b)(ii) and 2.03(b)(ii) above and that, in the case of
Additional Accounts, the list delivered pursuant to Section 2.05 below is, as of
the applicable Additional Cut-Off Date, true and complete in all material
respects.

     Section 2.05.  Delivery of Documents.  In the case of the designation of
Additional Accounts, the Bank shall deliver to HRAC, or its designee, (i) the
computer file or microfiche list required to be delivered pursuant to Section
2.01 with respect to such Additional Accounts on the date such file or list is
required to be delivered pursuant to Section 2.01 (the "Document Delivery Date")
and (ii) a duly executed, written assignment (including an acceptance by HRAC),
substantially in the form of Exhibit A (the "Supplemental Conveyance"), on the
Document Delivery Date. In addition, in the case of the designation of New
Accounts, the Bank shall deliver to HRAC, or its designee, on the Document
Delivery Date an Officer's Certificate confirming, to the extent applicable, the
items set forth in clause (i) through (vi) of subsection 2.03(b) above.

                                  ARTICLE III

                           CONSIDERATION AND PAYMENT

     Section 3.01.  Purchase Price.

     (a)  The "Purchase Price" for the Receivables in the Initial Accounts and
the related Purchased Assets conveyed to HRAC by the Bank under this Agreement
shall be payable on the Closing Date and shall be an amount equal to 100% of the
aggregate balance of Principal Receivables in those Accounts as of the Closing
Date, plus the present value of anticipated excess spread, computed by taking
into account factors such as historical losses, servicing fees, delinquencies
and paydown rates, yield and such other factors as the Bank and HRAC mutually
agree (and discounted to take into account any uncertainty as to future
performance matching historical performances), will result in a Purchase Price
determined to be the fair market value of such Purchased Assets. This
computation of initial purchase price shall assume no reinvestment in new
Receivables. The Purchase Price for the Receivables and the related Purchased
Assets (including Receivables and the related Purchased Assets in Additional
Accounts) to be conveyed to HRAC under this Agreement which come into existence
after the Closing Date, shall be payable on the Distribution Date following the
Due Period in which such Receivables and Purchased Assets are conveyed by the
Bank to HRAC in an amount equal to 100% of the aggregate balance of the
Principal Receivables so conveyed (the "New Principal Receivables"), plus the
present value of anticipated excess spread, computed by taking into account
factors such as historical losses, servicing fees, delinquencies, paydown rates
and yield and such other factors as the Bank and HRAC mutually agree (and
discounted to take into account any uncertainty as to future performance
matching historical performances).

     (b)  The Purchase Price to be paid by HRAC on the Closing Date and on each
Distribution Date following a Due Period during which New Principal Receivables
are conveyed to HRAC shall be paid in cash (including netting against other
payments).

                                       9

<PAGE>   13

     Section 3.02.  Adjustments to Purchase Price. The Purchase Price shall be
adjusted on each Distribution Date (a "Credit Adjustment") with respect to any
Receivable previously conveyed to HRAC by the Bank which has since been reversed
because of a rebate, refund, unauthorized charge or billing error to a
cardholder because such Receivable was created in respect of merchandise which
was refused or returned by a cardholder. The amount of such adjustment shall
equal (x) the reduction in the principal balance of such Receivable resulting
from the occurrence of such event multiplied by (y) the quotient (expressed as a
percentage) of (i) the Purchase Price for Principal Receivables payable on such
Distribution Date computed in accordance with Section 3.01(a) divided by (ii)
the Principal Receivables paid for on such date pursuant to such Section. In the
event that an adjustment pursuant to this Section 3.02 causes the Purchase Price
to be a negative number, the Bank agrees that, not later than 1:00 P.M. New York
City time on such Distribution Date, the Bank shall pay to HRAC an amount equal
to the amount by which the Purchase Price minus the Credit Adjustment would be
reduced below zero.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

     Section 4.01.  Representations and Warranties of the Bank Relating to the
Bank. The Bank hereby represents and warrants to, and agrees with, HRAC as of
the Closing Date and on each Addition Date, that:

     (a)  Organization and Good Standing.  The Bank is a national bank duly
organized and validly existing in good standing under the laws of the United
States and has, in all material respects, full power and authority to own its
properties and conduct its business as such properties are presently owned and
such business is presently conducted, and to execute, deliver and perform its
obligations under this Agreement.

     (b)  Due Qualification.  The Bank is duly qualified to do business and is
in good standing as a foreign corporation (or is exempt from such requirements)
and has obtained all necessary licenses and approvals, in each jurisdiction in
which failure to so qualify or to obtain such licenses and approvals would
(i) render any Credit Agreement relating to an Account or any Receivable
unenforceable by the Bank, HRAC, the Company or the Owner Trustee on behalf of
the Trust and (ii) have a material adverse effect on the Noteholders.

     (c)  Due Authorization.  The execution, delivery and performance of this
Agreement and any other document or instrument delivered pursuant hereto,
including any Supplemental Conveyance to which the Bank is a party (such other
documents or instruments, collectively, the "Conveyance Papers"), and the
consummation of the transactions provided for in this Agreement and the
Conveyance Papers have been duly authorized by the Bank by all necessary
corporate action on the part of the Bank.

     (d)  No Conflict.  The execution and delivery of this Agreement and the
Conveyance Papers by the Bank, the performance of the transactions contemplated
by this Agreement and the Conveyance Papers, and the fulfillment of the terms of
this Agreement and the Conveyance Papers applicable to the Bank will not
conflict with, violate or result in any breach of

                                       10

<PAGE>   14
any of the material terms and provisions of, or constitute (with or without
notice or lapse of time or both) a material default under, any indenture,
contract, agreement, mortgage, deed of trust, or other instrument to which the
Bank is a party or by which it or any of its properties are bound.

     (e)  No Violation.  The execution, delivery and performance of this
Agreement and the Conveyance Papers by the Bank and the fulfillment of the terms
contemplated herein and therein applicable to the Bank will not conflict with or
violate any Requirements of Law applicable to the Bank.

     (f)  No Proceedings.  There are no proceedings or investigations pending
or, to the best knowledge of the Bank, threatened against the Bank, before any
Governmental Authority (i) asserting the invalidity of this Agreement or the
Conveyance Papers, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or the Conveyance Papers, (iii)
seeking any determination or ruling that, in the reasonable judgment of the
Bank, would materially and adversely affect the performance by the Bank of its
obligations under this Agreement or the Conveyance Papers, (iv) seeking any
determination or ruling that would materially and adversely affect the validity
or enforceability of this Agreement or the Conveyance Papers or (v) seeking to
affect adversely the income tax attributes of the Trust under the United States
Federal or Delaware income tax systems.

     (g)  All Consents.  All authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required to be
obtained, effected or given by the Bank in connection with the execution and
delivery by the Bank of this Agreement and the Conveyance Papers and the
performance of the transactions contemplated by this Agreement or the Conveyance
Papers by the Bank have been duly obtained, effected or given and are in full
force and effect.

     The representations and warranties set forth in this Section 4.01 shall
survive the transfer and assignment of the Receivables to HRAC. Upon discovery
by the Bank or HRAC of a breach of any of the foregoing representations and
warranties, the party discovering such breach shall give written notice to the
other party, the Company, the Owner Trustee and the Indenture Trustee within
three Business Days following such discovery.

     Section 4.02.  Representations and Warranties of the Bank Relating to the
Agreement and the Receivables.

     (a)  Representations and Warranties.  The Bank hereby represents and
warrants to HRAC as of the date of this Agreement, as of the Closing Date and,
with respect to Additional Accounts, as of the related Addition Date that:

          (i)    this Agreement and, in the case of Additional Accounts, the
     related Supplemental Conveyance, each constitutes a legal, valid and
     binding obligation of the Bank enforceable against the Bank in accordance
     with its terms, except as such enforceability may be limited by applicable
     bankruptcy, insolvency, reorganization, moratorium or other similar laws
     affecting creditors' rights generally from time to time in effect or
     general principles of equity;

                                       11

<PAGE>   15
          (ii)   as of the Closing Date with respect to Initial Accounts, and as
     of the related Additional Cut-Off Date with respect to Additional Accounts,
     Schedule I to this Agreement, as supplemented to such date, is an accurate
     and complete listing in all material respects of all the Accounts as of the
     Closing Date or such Additional Cut-Off Date, as the case may be, and the
     information contained therein with respect to the identity of such Accounts
     and the Receivables existing thereunder is true and correct in all material
     respects as of the Closing Date or such applicable Additional Cut-Off Date,
     as the case may be;

          (iii)  each Receivable has been conveyed to HRAC free and clear of any
     Lien;

          (iv)   all authorizations, consents, orders or approvals of or
     registrations or declarations with any Governmental Authority required to
     be obtained, effected or given by the Bank in connection with the
     conveyance of Receivables to HRAC have been duly obtained, effected or
     given and are in full force and effect;

          (v)    this Agreement or, in the case of Additional Accounts, the
     related Supplemental Conveyance constitutes a valid sale, transfer and
     assignment to HRAC of all right, title and interest of the Bank in the
     Receivables and the proceeds thereof and the Recoveries payable pursuant to
     this Agreement;

          (vi)   on the Closing Date or on the Additional Cut-Off Date, as
     applicable, each related Initial Account or each related Additional, as
     applicable, Account is an Eligible Account;

          (vii)  on the Closing Date or on the applicable Additional Cut-Off
     Date, as applicable, each Receivable generated under the related Initial
     Account or Additional Accounts, as applicable, is an Eligible Receivable;

          (viii) as of the date of the creation of any new Receivable, such
     Receivable is an Eligible Receivable; and

          (ix)   no selection procedures believed by the Bank to be materially
     adverse to the interests of HRAC or the Noteholders have been used in
     selecting such Accounts.

     (b)  Notice of Breach.  The representations and warranties set forth in
this Section 4.02 shall survive the transfer and assignment of the Receivables
to HRAC. Upon discovery by either the Bank or HRAC of a breach of any of the
representations and warranties set forth in this Section 4.02, the party
discovering such breach shall give written notice to the other party, the
Company, the Owner Trustee and the Indenture Trustee within three Business Days
following such discovery; provided that the failure to give notice within three
Business Days does not preclude subsequent notice. The Bank hereby acknowledges
that HRAC intends to rely on the representations hereunder in connection with
representations made by HRAC to secured parties, assignees or subsequent
transferees including but not limited to transfers made by HRAC to the Company
pursuant to the Receivables Purchase Agreement, dated _____, 2001, by and
between HRAC and the Company, and by the Company to the Trust pursuant to the
Transfer and Servicing Agreement and by the Trust to the Indenture Trustee
pursuant to the Indenture and that the

                                       12

<PAGE>   16
Company, the Owner Trustee and the Indenture Trustee may enforce such
representations directly against the Bank.

     Section 4.03.  Representations and Warranties of HRAC.  As of the Closing
Date and on each Addition Date, HRAC hereby represents and warrants to, and
agrees with, the Bank that:

     (a)  Organization and Good Standing.  HRAC is a corporation duly organized
and validly existing under the laws of the State of Delaware and has, in all
material respects, full power and authority to own its properties and conduct
its business as such properties are presently owned and such business is
presently conducted and to execute, deliver and perform its obligations under
this Agreement.

     (b)  Due Authorization.  The execution and delivery of this Agreement and
the Conveyance Papers and the consummation of the transactions provided for in
this Agreement and the Conveyance Papers have been duly authorized by HRAC by
all necessary corporate action on the part of HRAC.

     (c)  No Conflict.  The execution and delivery of this Agreement and the
Conveyance Papers by HRAC, the performance of the transactions contemplated by
this Agreement and the Conveyance Papers, and the fulfillment of the terms of
this Agreement and the Conveyance Papers applicable to HRAC, will not conflict
with, result in any breach of any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a material default
under, any indenture, contract, agreement, mortgage, deed of trust or other
instrument to which HRAC is a party or by which it or any of its properties are
bound.

     (d)  No Violation.  The execution, delivery and performance of this
Agreement and the Conveyance Papers by HRAC and the fulfillment of the terms
contemplated herein and therein applicable to HRAC will not conflict with or
violate any Requirements of Law applicable to HRAC.

     (e)  No Proceedings.  There are no proceedings or investigations pending
or, to the best knowledge of HRAC, threatened against HRAC, before any
Governmental Authority (i) asserting the invalidity of this Agreement or the
Conveyance Papers, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or the Conveyance Papers, (iii)
seeking any determination or ruling that, in the reasonable judgment of HRAC,
would materially and adversely affect the performance by HRAC of its obligations
under this Agreement or the Conveyance Papers or (iv) seeking any determination
or ruling that would materially and adversely affect the validity or
enforceability of this Agreement or the Conveyance Papers.

     (f)  All Consents.  All authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required to be
obtained, effected or given by HRAC in connection with the execution and
delivery by HRAC of this Agreement and the Conveyance Papers and the performance
of the transactions contemplated by this Agreement and the Conveyance Papers
have been duly obtained, effected or given and are in full force and effect.

                                       13

<PAGE>   17
     The representations and warranties set forth in this Section 4.03 shall
survive the Conveyance of the Receivables to HRAC. Upon discovery by HRAC or the
Bank of a breach of any of the foregoing representations and warranties, the
party discovering such breach shall give prompt written notice to the other
party, the Owner Trustee and the Indenture Trustee.

                                   ARTICLE V

                                   COVENANTS

     Section 5.01.  Covenants of the Bank.  The Bank hereby covenants and agrees
with HRAC as follows:

     (a)  Receivables Not To Be Evidenced by Promissory Notes.  Except in
connection with its enforcement or collection of an Account, the Bank will take
no action to cause any Receivable to be evidenced by any instrument (as defined
in the UCC) and if any Receivable is so evidenced as a result of any action by
the Bank it shall be deemed to be an Ineligible Receivable in accordance with
Section 6.01(a) and shall be reassigned to the Bank in accordance with
Section 6.01(b)

     (b)  Security Interests.  Except for the conveyances hereunder, the Bank
will not sell, pledge, assign or transfer to any other Person, or take any other
action inconsistent with HRAC's ownership of the Receivables or grant, create,
incur, assume or suffer to exist any Lien (arising through or under the Bank)
on, any Receivable, whether now existing or hereafter created, or any interest
therein, and the Bank shall not claim any ownership interest in the Receivables
and shall defend the right, title and interest of HRAC in, to and under the
Receivables, whether now existing or hereafter created, against all claims of
third parties claiming through or under the Bank.

     (c)  Account Allocations.  In the event that the Bank is unable for any
reason to transfer Receivables to HRAC in accordance with the provisions of this
Agreement (including, without limitation, by reason of the application of the
provisions of Section 8.02 or any order of any Governmental Authority), then, in
any such event, the Bank agrees (except as prohibited by any such order) to
allocate and pay to HRAC, after the date of such inability, all amounts that
HRAC will be required to allocate and pay to the Company pursuant to
Section 5.01 of the Receivables Purchase Agreement between HRAC and the Company.

     (d)  Delivery of Collections or Recoveries.  In the event that the Bank
receives Collections or Recoveries, the Bank agrees to pay to HRAC (or to the
Servicer if HRAC so directs) all such Collections and Recoveries as soon as
practicable after receipt thereof.

     (e)  Notice of Liens.  The Bank shall notify HRAC promptly after becoming
aware of any Lien on any Receivable other than the conveyances hereunder, under
the Transfer and Servicing Agreement and under the Indenture.

     (f)  Documentation of Transfer.  The Bank shall undertake to file the
documents which would be necessary to perfect and maintain the transfer of the
Purchased Assets to HRAC.

                                       14

<PAGE>   18
     (g)  Periodic Rate Finance Charges.  Except (A) as otherwise required by
any Requirements of Law or (B) as is deemed by the Bank or other Account Owner,
as the case may be, to be necessary in order for it to maintain its credit
business or a program operated by such credit business on a competitive basis
based on a good faith assessment by it of the nature of the competition with
respect to the credit business or such program, it shall not at any time take
any action which would have the effect of reducing the Series Portfolio Yield to
a level that could be reasonably expected to result in an Adverse Effect with
respect to any Series based on the insufficiency of the Series Portfolio Yield
or any similar test.

     (h)  Credit Agreements and Guidelines.  Subject to compliance with all
Requirements of Law and paragraph (g) above, the Bank (or other Account Owner if
the Bank is not the Account Owner) or the Servicer may change the terms and
provisions of the applicable Credit Agreements or the applicable Credit
Guidelines of the Bank (or other Account Owner if the Bank is not the Account
Owner) or the Servicer in any respect (including the calculation of the amount
or the timing of charge-offs and the Periodic Rate Finance Charges to be
assessed thereon). Notwithstanding the above, unless required by Requirements of
Law or as permitted by paragraph (g) above, the Bank (or other Account Owner if
the Bank is not the Account Owner) or the Servicer will not take any action
unless (i) at the time of such action, the Bank (or other Account Owner, as the
case may be) or the Servicer, reasonably believes that such action will not
cause an Adverse Effect, and (ii) such change is made applicable to the
comparable segment of the revolving credit accounts owned by the Bank (or other
Account Owner, as the case may be) or serviced by the Servicer which have
characteristics the same as, or substantially similar to, the Accounts that are
the subject of such change, except as otherwise restricted by an endorsement,
sponsorship, or other agreement between the Bank or other Account Owner, as the
case may be, and an unrelated third party or by the terms of the Credit
Agreements.

     (i)  Approval and Official Records.  The Bank shall cause this Agreement to
be duly approved by the Bank's Board of Directors, and the Bank shall maintain
this Agreement as a part of the official records of the Bank for the term of
this Agreement.

                                   ARTICLE VI

                             REPURCHASE OBLIGATION

     Section 6.01.  Reassignment of Ineligible Receivables.

     (a)  In the event any representation or warranty under Section 4.02(a)(ii),
(iii), (iv), (vi), (vii), (viii) or (ix) is not true and correct in any material
respect as of the date specified therein with respect to any Receivable or the
related Account and as a result of such breach HRAC is required to accept
reassignment of Ineligible Receivables previously sold by the Bank to HRAC
pursuant to Section 6.01(b) of the Receivables Purchase Agreement between HRAC
and the Company, the Bank shall accept reassignment of HRAC's interest in such
Ineligible Receivables on the terms and conditions set forth in Section 6.01(b)
of this Agreement.

     (b)  The Bank shall accept reassignment from HRAC of any Ineligible
Receivables previously sold by the Bank to HRAC on the date on which such
reassignment

                                       15

<PAGE>   19
obligation arises, and shall pay for such reassigned Ineligible Receivables by
paying to HRAC, not later than 3:00 p.m., New York City time on such date, an
amount equal to the unpaid principal balance of such Ineligible Receivables plus
accrued and unpaid finance charges at the annual percentage rate applicable to
such Receivables from the last date billed through the end of the Due Period in
which such reassignment obligation arises. Upon reassignment of such Ineligible
Receivables, HRAC shall automatically and without further action be deemed to
sell, transfer, assign, set-over and otherwise convey to the Bank, without
recourse, representation or warranty, all the right, title and interest of HRAC
in and to such Ineligible Receivables, all Recoveries related thereto, all
monies and amounts due or to become due with respect thereto and all proceeds
thereof; and such reassigned Ineligible Receivables shall be treated by HRAC as
collected in full as of the date on which they were transferred. HRAC shall
execute such documents and instruments of transfer or assignment and take such
other actions as shall reasonably be requested by the Bank to effect the
conveyance of such Ineligible Receivables and other property pursuant to this
subsection.

     Section 6.02.  Reassignment of Trust Portfolio.  In the event any
representation or warranty set forth in Section 4.01(a), (c), (d), (f) or (g) or
Section 4.02(a)(i) or (a)(v) is not true and correct in any material respect and
as a result of such breach HRAC is required to accept a reassignment of the
Receivables previously sold by the Bank to HRAC pursuant to Section 6.02 of the
Receivables Purchase Agreement between HRAC and the Company, the Bank shall be
obligated to accept a reassignment of HRAC's interest in such Receivables on the
terms set forth below.

     The Bank shall pay to HRAC by depositing in the Collection Account in
immediately available funds, not later than 1:00 P.M. New York City time, on the
first Transfer Date following the Due Period in which such reassignment
obligation arises, in payment for such reassignment, an amount equal to the
amount specified in Section 2.06 of the Transfer and Servicing Agreement. Upon
such reassignment of Receivables, HRAC shall automatically and without further
action be deemed to sell, transfer, assign, set-over and otherwise convey to the
Bank, without recourse, representation or warranty, all the right, title and
interest of HRAC in and to such Receivables, all Recoveries related thereto, all
monies and amounts due or to become due with respect thereto and all proceeds
thereof; and such reassigned Receivables shall be treated by HRAC as collected
in full as of the date on which they were transferred. HRAC shall execute such
documents and instruments of transfer or assignment and take such other actions
as shall reasonably be requested by the Bank to effect the conveyance of such
Receivables and other property pursuant to this subsection.

                                  ARTICLE VII

                              CONDITIONS PRECEDENT

     Section 7.01.  Conditions to HRAC's Obligations Regarding Initial
Receivables.  The obligations of HRAC to purchase the Receivables in the Initial
Accounts on the Closing Date shall be subject to the satisfaction of the
following conditions:

                                       16

<PAGE>   20
     (a)  All representations and warranties of the Bank contained in this
Agreement shall be true and correct on the Closing Date with the same effect as
though such representations and warranties had been made on such date;

     (b)  All information concerning the Initial Accounts provided to HRAC, or
its designee, shall be true and correct as of the Closing Date in all material
respects;

     (c)  The Bank shall have (i) delivered to HRAC, or its designee, a computer
file or microfiche list containing a true and complete list of all Initial
Accounts identified by account number and by the Receivables balance as of the
Closing Date and (ii) substantially performed all other obligations required to
be performed by the provisions of this Agreement;

     (d)  The Bank shall have recorded and filed, at its expense, any financing
statement with respect to the Receivables (other than Receivables in Additional
Accounts) now existing and hereafter created for the transfer of accounts and
general intangibles (each as defined in Section 9-106 of the UCC) meeting the
requirements of applicable state law in such manner and in such jurisdictions as
would be necessary to perfect the sale of and security interest in the
Receivables from the Bank to HRAC, and shall deliver a file-stamped copy of such
financing statements or other evidence of such filings to HRAC, or its designee;

     (e)  On or before the Closing Date, (i) HRAC and the Company shall have
entered into a Receivables Purchase Agreement (ii) the Company and the Owner
Trustee shall have entered into the Trust Agreement (iii) the Company, Household
Finance Corporation and the Owner Trustee shall have entered into the Transfer
and Servicing Agreement, (iv) the Trust and the Indenture Trustee shall have
entered into the Indenture and (v) the closing under the Transfer and Servicing
Agreement and the Indenture shall take place simultaneously with the initial
closing hereunder; and

     (f)  All corporate and legal proceedings and all instruments in connection
with the transactions contemplated by this Agreement shall be satisfactory in
form and substance to HRAC, and HRAC shall have received from the Bank copies of
all documents (including, without limitation, records of corporate proceedings)
relevant to the transactions herein contemplated as HRAC may reasonably have
requested.

     Section 7.02.  Conditions Precedent to the Bank's Obligations.  The
obligations of the Bank to sell Receivables in the Initial Accounts on the
Closing Date shall be subject to the satisfaction of the following conditions:

     (a)  All representations and warranties of HRAC contained in this Agreement
shall be true and correct with the same effect as though such representations
and warranties had been made on such date;

     (b)  Payment or provision for payment of the Purchase Price in accordance
with the provision of Section 3.01 hereof shall have been made; and

     (c)  All corporate and legal proceedings and all instruments in connection
with the transactions contemplated by this Agreement shall be satisfactory in
form and substance to the Bank, and the Bank shall have received from HRAC
copies of all documents (including, without

                                       17

<PAGE>   21
limitation, records of corporate proceedings) relevant to the transactions
herein contemplated as the Bank may reasonably have requested.

                                  ARTICLE VIII

                         TERM AND PURCHASE TERMINATION

     Section 8.01.  Term.  This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until the termination of the
Trust as provided in Article VIII of the Trust Agreement.

     Section 8.02.  Purchase Termination.  If the Bank shall fail generally to,
or admit in writing its inability to, pay its debts as they become due; or if a
proceeding shall have been instituted in a court having jurisdiction in the
premises seeking a decree or order for relief in respect of the Bank in an
involuntary case under any Debtor Relief Law, or for the appointment of a
receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator or
other similar official of the Bank or for any substantial part of the Bank's
property, or for the winding-up or liquidation of the Bank's affairs and, if
instituted against the Bank, any such proceeding shall continue undismissed or
unstayed and in effect, for a period of 60 consecutive days, or any of the
actions sought in such proceeding shall occur; or if the Bank shall commence a
voluntary case under any Debtor Relief Law, or if the Bank shall consent to the
entry of an order for relief in an involuntary case under any Debtor Relief Law,
or consent to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator, conservator or other similar
official of, or for, any substantial part of its property, or any general
assignment for the benefit of its creditors; or the Bank or any subsidiary of
the Bank shall have taken any corporate action in furtherance of any of the
foregoing actions (each an "Insolvency Event"); then the Bank shall immediately
cease to transfer Principal Receivables to HRAC and shall promptly give notice
to HRAC, the Company, the Owner Trustee and the Indenture Trustee of such
Insolvency Event. Notwithstanding any cessation of the transfer to HRAC of
additional Principal Receivables, Principal Receivables transferred to HRAC
prior to the occurrence of such Insolvency Event and Collections in respect of
such Principal Receivables and Finance Charge and Administrative Receivables
whenever created, accrued in respect of such Principal Receivables, shall
continue to be property of HRAC available for transfer by HRAC to the Company
pursuant to the Transferor RPA.

                                   ARTICLE IX

                            MISCELLANEOUS PROVISIONS

     Section 9.01.  Amendment.  This Agreement and any Conveyance Papers and the
rights and obligations of the parties hereunder and thereunder may not be
changed orally, but only by an instrument in writing signed by HRAC and the Bank
in accordance with this Section 9.01. This Agreement and any Conveyance Papers
may be amended from time to time by HRAC and the Bank (i) to cure any ambiguity,
(ii) to correct or supplement any provisions herein which may be inconsistent
with any other provisions herein or in any such other Conveyance Papers, (iii)
to add

                                       18
<PAGE>   22
any other provisions with respect to matters or questions arising under this
Agreement or any Conveyance Papers which shall not be inconsistent with the
provisions of this Agreement or any Conveyance Papers, (iv) to change or modify
the Purchase Price and (v) to change, modify, delete or add any other obligation
of the Bank or HRAC; provided, however that no amendment pursuant to clause (v)
of this Section 9.01 shall be effective unless the Bank and HRAC have been
notified in writing that the Rating Agency Condition has been satisfied;
provided, further, the Bank and HRAC shall have delivered to the Company, the
Owner Trustee and the Indenture Trustee an Officer's Certificate, dated the date
of any such action, stating that each of the Bank and HRAC, respectively,
reasonably believes that such action will not have an Adverse Effect, unless the
Company, the Owner Trustee and the Indenture Trustee shall consent thereto. Any
reconveyance executed in accordance with the provisions hereof shall not be
considered to be an amendment to this Agreement. A copy of any amendment to this
Agreement shall be sent to the Rating Agency.

     Section 9.02.  Governing Law.  THIS AGREEMENT AND THE CONVEYANCE PAPERS
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.

     Section 9.03.  Notices.  All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by registered mail, return receipt requested, to (a) in
the case of the Bank, 1111 Town Center Drive, Las Vegas, Nevada 89134,
Attention: General Counsel, (b) in the case of HRAC, 2700 Sanders Road, Prospect
Heights, IL 60070, Attention: General Counsel, (c) in the case of the Owner
Trustee, Rodney Square North, 1100 North Market Street, Wilmington, DE
19890-0001, (d) in the case of the Indenture Trustee, 111 East Wacker Drive,
Chicago, Illinois, 60601, Attention: Corporate Trust Department, (e) in the case
of the Servicer, Household Finance Corporation, 2700 Sanders Road, Prospect
Heights, Illinois 60070, Attention: S.H. Smith, Assistant Treasurer, (f) in the
case of Fitch, Fitch, Inc., One State Street Plaza, New York, NY 10004,
Attention: ABS Surveillance, (g) in the case of Moody's, Moody's Investors
Service Inc., 99 Church Street, New York, NY 10007, Attention: ABS Monitoring
Group, or (h) in the case of Standard & Poor's, Standard & Poor's Ratings Group,
55 Water Street, New York, NY 10041, Attention: Credit Card ABS; or, as to each
party, at such other address as shall be designated by such party in a written
notice to each other party.

     Section 9.04.  Severability of Provisions.  If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any Conveyance
Paper shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions, or terms shall be deemed severable from the remaining
covenants, agreements, provisions, and terms of this Agreement or any Conveyance
Paper and shall in no way affect the validity or enforceability of the other
provisions of this Agreement or of any Conveyance Paper.

     Section 9.05.  Assignment.  Notwithstanding anything to the contrary
contained herein, other than HRAC's assignment of its rights, title, and
interests in, to, and under this Agreement to the Company and the Company's
assignment of its rights, title and interest in, to and under this Agreement to
the Trust and the Trust's assignment of its rights, title and interests in, to
and under this Agreement to the Indenture Trustee for the benefit of the
beneficiaries of the Trust,

                                       19

<PAGE>   23
including the Noteholders as contemplated by the Transfer and Servicing
Agreement, the Indenture and Section 9.06 hereof, this Agreement and all other
Conveyance Papers may not be assigned by the parties hereto unless the Bank
shall assign its rights, title and interests in, to and under this Agreement to
(a) any successor by merger assuming this Agreement (b) to any affiliate owned
directly or indirectly by Household International, Inc. which assumes the
obligations of this Agreement or (c) to any entity provided that the Rating
Agency has advised HRAC and the Bank that the Rating Agency Condition has been
satisfied.

     Section 9.06.  Acknowledgement and Agreement of the Bank.  By execution
below, the Bank expressly acknowledges and agrees that all of HRAC's right,
title, and interest in, to, and under this Agreement, including, without
limitation, all of HRAC's right, title, and interest in and to the Receivables
purchased pursuant to this Agreement, shall be assigned by HRAC to the Company,
and shall be assigned by the Company to the Owner Trustee, and shall be assigned
by the Owner Trustee to the Indenture Trustee for the benefit of the
beneficiaries of the Trust, including the Noteholders, and the Bank consents to
such assignments. The Bank further agrees that notwithstanding any claim,
counterclaim, right of setoff or defense which it may have against HRAC, due to
a breach by HRAC of this Agreement or for any other reason, and notwithstanding
the bankruptcy of HRAC or any other event whatsoever, the Bank's sole remedy
shall be a claim against HRAC for money damages, and then only to the extent of
funds received by HRAC pursuant to the Receivables Purchase Agreement between
HRAC and the Company, and in no event shall the Bank assert any claim on or any
interest in the Receivables or any proceeds thereof or take any action which
would reduce or delay receipt by the Company or the Owner Trustee of collections
with respect to the Receivables. Additionally, the Bank agrees for the benefit
of the Noteholders that any amounts payable by the Bank to HRAC hereunder which
are to be paid by HRAC to the Company then paid by the Company to the Owner
Trustee and pledged to the Indenture Trustee for the benefit of the Noteholders
shall be paid by the Bank, on behalf of HRAC, directly to the Company.

     Section 9.07.  Further Assurances.  HRAC and the Bank agree to do and
perform, from time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by the other party, the Company,
the Owner Trustee or the Indenture Trustee more fully to effect the purposes of
this Agreement, the Conveyance Papers and the Transfer and Servicing Agreement,
including, without limitation, the execution of any financing statements or
continuation statements or equivalent documents relating to the Receivables for
filing under the provisions of the UCC or other law of any applicable
jurisdiction.

     Section 9.08.  No Waiver; Cumulative Remedies.  No failure to exercise and
no delay in exercising, on the part of HRAC or the Bank, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. Subject to Section 9.06, the rights,
remedies, powers and privileges herein provided are cumulative and not
exhaustive of any rights, remedies, powers and privileges provided by law.

     Section 9.09.  Counterparts.  This Agreement and all Conveyance Papers may
be executed in two or more counterparts (and by different parties on separate
counterparts), each of which shall be an original, but all of which together
shall constitute one and the same instrument.

                                       20

<PAGE>   24
     Section 9.10.  Binding; Third-Party Beneficiaries.  This Agreement and the
Conveyance Papers will inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns. The Company, the
Owner Trustee and the Indenture Trustee shall be considered third-party
beneficiaries of this Agreement.

     Section 9.11.  Merger and Integration.  Except as specifically stated
otherwise herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement and the
Conveyance Papers. This Agreement and the Conveyance Papers may not be modified,
amended, waived or supplemented except as provided herein.

     Section 9.12.  Headings.  The headings are for purposes of reference only
and shall not otherwise affect the meaning or interpretation of any provision
hereof.

     Section 9.13.  Schedules and Exhibits.  The schedules and exhibits attached
hereto and referred to herein shall constitute a part of this Agreement and are
incorporated into this Agreement for all purposes.

     Section 9.14.  Survival of Representations and Warranties.  All
representations, warranties and agreements contained in this Agreement or
contained in any Supplemental Conveyance, shall remain operative and in full
force and effect and shall survive conveyance of the Receivables by the Bank to
HRAC and thereafter to the Company pursuant to the Receivables Purchase
Agreement between HRAC and the Company, and thereafter by the Company to the
Trust pursuant to the Transfer and Servicing Agreement and by the Trust and the
Indenture Trustee pursuant to the Indenture.

     Section 9.15.  Nonpetition Covenant.  Notwithstanding any prior termination
of this Agreement, the Bank shall not, prior to the date which is one year and
one day after the termination of this Agreement, acquiesce, petition or
otherwise invoke or cause HRAC to invoke the process of any Governmental
Authority for the purpose of commencing or sustaining a case against HRAC under
any Federal or state bankruptcy, insolvency or similar law or appointing a
receiver, conservator, liquidator, assignee, trustee, custodian, sequestrator or
other similar official of HRAC or any substantial part of its property or
ordering the winding-up or liquidation or the affairs of HRAC.

                                       21

<PAGE>   25

     IN WITNESS WHEREOF, HRAC and the Bank have caused this Agreement to be duly
executed by their respective officers as of the day and year first above
written.

                                        HOUSEHOLD BANK (SB), N.A.

                                        By: ____________________________________
                                            Name:
                                            Title:

                                        HOUSEHOLD RECEIVABLES ACQUISITION
                                          COMPANY

                                        By: ____________________________________
                                            Name:
                                            Title:
<PAGE>   26

                                                                       EXHIBIT A

                        FORM OF SUPPLEMENTAL CONVEYANCE

                        (As required by Section 2.05 of
                      the Receivables Purchase Agreement)

     SUPPLEMENTAL CONVEYANCE No. ____ dated as of ____________ __, ____, by and
between HOUSEHOLD BANK (SB), N.A. (the "Bank"), and HOUSEHOLD RECEIVABLES
ACQUISITION COMPANY ("HRAC"), pursuant to the Receivables Purchase Agreement
referred to below.

                                  W I T N E S S E T H:

     WHEREAS, the Bank and HRAC are parties to an Receivables Purchase
Agreement, dated as of ____________ (hereinafter as such agreement may have
been, or may from time to time be, amended, supplemented or otherwise modified,
the "Receivables Purchase Agreement");

     WHEREAS, pursuant to the Receivables Purchase Agreement, the Bank wishes to
designate Additional Accounts to be included as Accounts and the Bank wishes to
convey its right, title and interest in the Receivables of such Additional
Accounts, whether now existing or hereafter created, to HRAC pursuant to the
Receivables Purchase Agreement; and

     WHEREAS, HRAC is willing to accept such designation and conveyance subject
to the terms and conditions hereof.

     NOW, THEREFORE, the Bank and HRAC hereby agree as follows:

     1.   Defined Terms.  All capitalized terms used herein shall have the
meanings ascribed to them in the Receivables Purchase Agreement unless otherwise
defined herein.

     "Addition Date" shall mean, with respect to the Additional Accounts
designated hereby ____________ ___, _____.

     "Additional Cut-Off Date" shall mean, with respect to the Additional
Accounts designated hereby, ____________ ___, _____.

     2.   Designation of Additional Accounts.  The Bank delivers herewith a
computer file or microfiche list containing a true and complete schedule
identifying all such Additional Accounts designated hereby (the "Additional
Accounts") and specifying for each such Additional Account, as of the Additional
Cut-Off Date, its account number, the aggregate amount outstanding in such
Account and the aggregate amount of Principal Receivables in such Additional
Account. Such computer file, microfiche list or other documentation shall be as
of the date of this Supplemental Conveyance incorporated into and made part of
this Supplemental Conveyance and is marked as Schedule I to this Supplemental
Conveyance.

                                      A-1

<PAGE>   27
     3.   Conveyance of Receivables.

     (a)  The Bank does hereby sell, transfer, assign, set over and otherwise
convey to HRAC, without recourse except as provided in the Receivables Purchase
Agreement, all its right, title and interest in, to and under the Receivables
generated by such Additional Accounts, existing at the close of business on the
Additional Cut-Off Date and thereafter created until termination of the
Receivables Purchase Agreement pursuant to Article VIII thereof, all Recoveries
with respect to such Accounts, all monies due or to become due and all amounts
received or receivable with respect thereto and all "proceeds" (including,
without limitation, "proceeds" as defined in Article 9 of the UCC) thereof.

     (b)  In connection with such sale, the Bank agrees to record and file, at
its own expense, one or more financing statements (and continuation statements
with respect to such financing statements when applicable) with respect to the
Receivables, existing on the Additional Cut-Off Date and thereafter created, for
the transfer of accounts and general intangibles meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary
to perfect the sale and assignment of and the security interest in the
Receivables to HRAC, and to deliver a file-stamped copy of such financing
statement or other evidence of such filing to HRAC.

     (c)  In connection with such sale, the Bank further agrees, at its own
expense, on or prior to the date of this Supplemental Conveyance, to indicate in
the appropriate computer files or microfiche list that all Receivables created
in connection with the Additional Accounts designated hereby have been conveyed
to HRAC pursuant to this Supplemental Conveyance.

     (d)  The parties hereto intend that the conveyance described in
Section 3(a) constitute an absolute sale consistent with the intent expressed in
Section 2.01(d) of the Receivables Purchase Agreement. In the event, however,
that notwithstanding such intent a court of competent jurisdiction were to hold
that the transactions evidenced hereby constitute a loan and not a purchase and
sale, it is the intention of the parties hereto that this Supplemental
Conveyance shall constitute a security agreement under applicable law, and that
the Bank shall be deemed to have granted, and the Bank does hereby grant, to
HRAC a first priority perfected security interest in all of the Bank's right,
title and interest, whether now owned or hereafter acquired, in, to and under
all Receivables existing on the Additional Cut-Off Date in the Additional
Accounts and thereafter created from time to time until the termination of the
Receivables Purchase Agreement pursuant to Article VIII thereof, all Recoveries
with respect to such Accounts, all monies due or to become due and all amounts
received or receivable with respect thereto, and all proceeds (including,
without limitation, "proceeds" as defined in Article 9 of the UCC) thereof.

     4.  Acceptance by the HRAC.  HRAC hereby acknowledges its acceptance of all
right, title and interest to the property, now existing and hereafter created,
conveyed to HRAC pursuant to Section 3 of this Supplemental Conveyance, and
declares that it shall maintain such right, title and interest. HRAC further
acknowledges that, prior to or simultaneously with the execution and delivery of
this Supplemental Conveyance, the Bank delivered to HRAC the computer file or
microfiche list described in Section 2 of this Supplemental Conveyance.

                                      A-2

<PAGE>   28
     5.   Representations and Warranties of the Bank.  The Bank hereby
represents and warrants to HRAC as of the date of this Supplemental Conveyance
and as of the Addition Date that:

     (a)  Legal, Valid and Binding Obligation.  This Supplemental Conveyance
constitutes a legal, valid and binding obligation of the Bank enforceable
against the Bank in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally from time to time in
effect or general principles of equity;

     (b)  Eligibility of Accounts.  On the Additional Cut-Off Date, each
Additional Account designated hereby is an Eligible Account;

     (c)  No Liens.  Each Receivable in an Additional Account designated hereby
has been conveyed to HRAC free and clear of any Lien;

     (d)  Eligibility of Receivables.  On the Additional Cut-Off Date, each
Receivable existing in an Additional Account designated hereby is an Eligible
Receivable and as of the date of creation of any Receivable in an Additional
Account designated hereby, such Receivable is an Eligible Receivable;

     (e)  Selection Procedures.  No selection procedure believed by the Bank to
be adverse to the interests of HRAC or the Noteholders was utilized in selecting
the Additional Accounts;

     (f)  Transfer of Receivables.  This Supplemental Conveyance constitutes a
valid sale, transfer and assignment to HRAC of all right, title and interest of
the Bank in the Receivables arising in the Additional Accounts designated hereby
now existing or hereafter created, all monies due or to become due and all
amounts received with respect thereto and the "proceeds" (including, without
limitation, "proceeds" as defined in Article 9 of the UCC) thereof and the
Recoveries with respect thereto;

     (g)  No Conflict.  The execution and delivery of this Supplemental
Conveyance, the performance of the transactions contemplated by this
Supplemental Conveyance and the fulfillment of the terms hereof, will not
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which the Bank is a party or by which it or its properties
are bound;

     (h)  No Violation.  The execution and delivery of this Supplemental
Conveyance by the Bank, the performance of the transactions contemplated by this
Supplemental Conveyance and the fulfillment of the terms hereof applicable to
the Bank will not conflict with or violate any Requirements of Law applicable to
the Bank;

     (i)  No Proceedings.  There are no proceedings or investigations, pending
or, to the best knowledge of the Bank, threatened against the Bank before any
Governmental Authority (i) asserting the invalidity of this Supplemental
Conveyance, (ii) seeking to prevent the consummation of any of the transactions
contemplated by this Supplemental Conveyance,

                                      A-3

<PAGE>   29
(iii) seeking any determination or ruling that, in the reasonable judgment of
the Bank, would materially and adversely affect the performance by the Bank of
its obligations under this Supplemental Conveyance or (iv) seeking any
determination or ruling that would materially and adversely affect the validity
or enforceability of this Supplemental Conveyance; and

     (j)  All Consents.  All authorizations, consents, orders or approvals of
any Governmental Authority required to be obtained by the Bank in connection
with the execution and delivery of this Supplemental Conveyance by the Bank and
the performance of the transactions contemplated by this Supplemental Conveyance
by the Bank, have been obtained.

     6.   Ratification of the Receivables Purchase Agreement.  The Receivables
Purchase Agreement is hereby ratified, and all references to the "Receivables
Purchase Agreement," to "this Agreement" and "herein" shall be deemed from and
after the Addition Date to be a reference to the Receivables Purchase Agreement
as supplemented by this Supplemental Conveyance. Except as expressly amended
hereby, all the representations, warranties, terms, covenants and conditions of
the Receivables Purchase Agreement shall remain unamended and shall continue to
be, and shall, remain, in full force and effect in accordance with its terms and
except as expressly provided herein shall not constitute or be deemed to
constitute a waiver of compliance with or consent to non-compliance with any
term or provision of the Receivables Purchase Agreement.

     7.   Counterparts.  This Supplemental Conveyance may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument.

     8.   Governing Law.  THIS SUPPLEMENTAL CONVEYANCE SHALL BE CONTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

                                      A-4

<PAGE>   30
     IN WITNESS WHEREOF, the undersigned have caused this Supplemental
Conveyance to be duly executed and delivered by their respective duly authorized
officers on the day and the year first above written.

Dated: ____________ ___, 200__         HOUSEHOLD BANK (SB), N.A.

                                       By: _____________________________________
                                           Name:
                                           Title:

                                       HOUSEHOLD RECEIVABLES ACQUISITION
                                         COMPANY

                                       By: _____________________________________
                                           Name:
                                           Title:

                                      A-5

<PAGE>   31
                                                                   Schedule I to
                                                                    Supplemental
                                                                      Conveyance

                              ADDITIONAL ACCOUNTS

        COMPUTER FILES CONTAINING ACCOUNT INFORMATION DELIVERED TO HRAC
                         ARE INCORPORATED BY REFERENCE

                                      I-1
<PAGE>   32
                                                                      Schedule I

                                LIST OF ACCOUNTS

         COMPUTER FILES CONTAINING ACCOUNT INFORMATION DELIVERED TO HRA
                          ARE INCORPORATED BY REFERENCE

                                      I-2

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