<PAGE>
PROSPECTUS SUPPLEMENT DATED DECEMBER 9, 1998
(TO PROSPECTUS DATED SEPTEMBER 3, 1998)
$300,000,000
[LOGO]
TOYOTA MOTOR CREDIT CORPORATION
5.50% NOTES DUE 2008
---------------------
Interest payable on June 15 and December 15, commencing June 15, 1999.
------------------------
Toyota Motor Credit Corporation ("TMCC") may not redeem the Notes prior to
maturity.
The Notes will not be subject to any sinking fund.
------------------------
Each Note will be represented by one or more global securities registered in
the name of a nominee of The Depository Trust Company ("DTC"). Except under the
limited circumstances described in this Prospectus Supplement under "Description
of the Notes--Global Notes, Delivery and Form," owners of beneficial interests
in the Notes will not be entitled to physical delivery of individual
certificates for their Notes in definitive form.
The Notes will trade in DTC's Same-Day Funds Settlement System until
maturity or until the issuance of Notes in definitive form and secondary market
trading activity in the Notes will therefore settle in immediately available
funds.
------------------------
ISSUE PRICE 99.802%
------------------------
<TABLE>
<CAPTION>
UNDERWRITING
DISCOUNTS AND
PRICE TO PUBLIC COMMISSIONS PROCEEDS TO TMCC
---------------------- ------------------- ----------------------
<S> <C> <C> <C>
Per Note................................... 99.802% 0.600% 99.202%
Total...................................... $299,406,000 $1,800,000 $297,606,000
</TABLE>
The Securities and Exchange Commission and state securities regulators have
not approved or disapproved these securities, or determined if this prospectus
supplement or the accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
The Underwriters expect to deliver the Notes through the facilities of DTC
to purchasers on December 14, 1998.
------------------------
BEAR, STEARNS & CO. INC.
ARTEMIS CAPITAL GROUP, INC.
BLAYLOCK & PARTNERS, L.P.
RAMIREZ & CO., INC.
UTENDAHL CAPITAL PARTNERS, L.P.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
PROSPECTUS SUPPLEMENT
Statement Regarding Forward-Looking
Statements................................... S-2
Selected Financial Information................. S-3
Capitalization................................. S-5
Description of the Notes....................... S-6
Same-Day Settlement and Payment................ S-9
Underwriting................................... S-10
<CAPTION>
PAGE
---------
<S> <C>
PROSPECTUS
Available Information.......................... 2
Incorporation of Certain Documents by
Reference.................................... 2
Toyota Motor Credit Corporation................ 3
Use of Proceeds................................ 3
Description of Debt Securities................. 3
Ratio of Earnings to Fixed Charges............. 8
Plan of Distribution........................... 9
Legal Matters.................................. 9
Experts........................................ 9
</TABLE>
No dealer, salesperson or other individual has been authorized to give any
information or to make any representations other than those contained or
incorporated by reference in this Prospectus Supplement and the accompanying
Prospectus in connection with the offer made by this Prospectus Supplement and
the accompanying Prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized by Toyota
Motor Credit Corporation ("TMCC") or the Underwriters (as defined in
"Underwriting"). Neither the delivery of this Prospectus Supplement or the
accompanying Prospectus nor any sale made hereunder shall, under any
circumstance create an implication that there has been no change in the affairs
of TMCC since the date hereof. This Prospectus Supplement and the accompanying
Prospectus do not constitute an offer or solicitation by anyone in any state in
which such offer or solicitation is not authorized or in which the person making
such offer or solicitation is not qualified to do so or to anyone to whom it is
unlawful to make such offer or solicitation.
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus Supplement and the accompanying Prospectus and the documents
incorporated by reference herein contain certain forward-looking statements, as
such term is defined in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended, relating to
future events and the financial performance of TMCC. Such statements are only
predictions and involve risks and uncertainties, resulting in the possibility
that the actual events or performance will differ materially from such
predictions.
S-2
<PAGE>
SELECTED FINANCIAL INFORMATION
The following selected financial data for the five years ended September 30,
1997 has been derived from financial statements examined by
PricewaterhouseCoopers LLP, independent accountants, included in the Annual
Reports of TMCC on Form 10-K for the years ended September 30, 1997, 1996, 1995,
1994 and 1993. TMCC's selected financial data for the nine months ended June 30,
1998 and 1997 has been derived from TMCC's unaudited financial statements
included in the Quarterly Report of TMCC on Form 10-Q for the quarter ended June
30, 1998 which, in the opinion of management, includes all adjustments,
consisting only of normal recurring adjustments, necessary for a fair statement
of the data for the interim periods presented. The information for the nine
months ended June 30, 1998 is not necessarily indicative of the results that may
be expected for the full fiscal year or any other interim period. The Annual
Report on Form 10-K for the year ended September 30, 1997 and the Quarterly
Report for the quarter ended June 30, 1998 referred to above are among the
documents incorporated by reference in this Prospectus Supplement and the
accompanying Prospectus. The following information should be read in conjunction
with the financial statements of TMCC contained in such documents. See
"Incorporation of Certain Documents by Reference" in the accompanying
Prospectus.
<TABLE>
<CAPTION>
NINE MONTHS
ENDED JUNE 30 YEARS ENDED SEPTEMBER 30,
-------------------- -----------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
--------- --------- --------- --------- --------- --------- ---------
(UNAUDITED) (U.S. DOLLARS IN MILLIONS)
(U.S. DOLLARS
IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
FINANCING REVENUES:
Leasing....................................... $ 1,943 $ 2,074 $ 2,739 $ 2,454 $ 1,902 $ 1,230 $ 751
Retail financing.............................. 394 328 446 415 431 413 468
Wholesale and other dealer financing.......... 73 68 89 109 121 86 80
--------- --------- --------- --------- --------- --------- ---------
Total financing revenues...................... 2,410 2,470 3,274 2,978 2,454 1,729 1,299
Depreciation on operating leases.............. 1,261 1,354 1,790 1,626 1,230 735 385
Interest expense.............................. 722 680 918 820 716 486 454
--------- --------- --------- --------- --------- --------- ---------
Net financing revenues........................ 427 436 566 532 508 508 460
Other revenues................................ 130 118 176 136 113 95 80
--------- --------- --------- --------- --------- --------- ---------
Net financing revenues and other revenues..... 557 554 742 668 621 603 540
--------- --------- --------- --------- --------- --------- ---------
EXPENSES:
Operating and administrative.................. 278 232 323 293 255 232 225
Provision for credit losses................... 108 101 136 115 66 78 60
--------- --------- --------- --------- --------- --------- ---------
Total expenses.............................. 386 333 459 408 321 310 285
--------- --------- --------- --------- --------- --------- ---------
Income before income taxes.................... 171 221 283 260 300 293 255
Provision for income taxes.................... 72 92 121 108 117 118 97
--------- --------- --------- --------- --------- --------- ---------
Net Income.................................. $ 99 $ 129 $ 162 $ 152 $ 183 $ 175 $ 158
--------- --------- --------- --------- --------- --------- ---------
--------- --------- --------- --------- --------- --------- ---------
BALANCE SHEET DATA
Investments in operating leases, net............ $ 9,775 $ 10,437 $ 10,257 $ 10,831 $ 8,148 $ 6,215 $ 3,050
Finance receivables, net........................ 11,390 8,856 8,452 7,474 7,227 7,834 7,226
Total assets.................................... 22,370 20,174 19,830 19,309 16,225 14,791 11,179
Notes and loans payable......................... 16,932 15,236 14,745 15,014 12,696 11,833 8,833
Capital stock (1)............................... 915 915 915 915 865 865 680
Retained earnings(2)............................ 1,258 1,126 1,159 997 844 662 487
RATIO OF EARNINGS TO FIXED CHARGES(3)........... 1.24x 1.32x 1.31x 1.32x 1.42x 1.60x 1.56x
</TABLE>
(FOOTNOTES CONTINUED ON NEXT PAGE)
S-3
<PAGE>
(FOOTNOTES CONTINUED FROM PREVIOUS PAGE)
- ------------------------------
(1) $10,000 par value per share.
(2) TMCC has not paid any dividends to date.
(3) The ratio of earnings to fixed charges was computed by dividing (i) the sum
of income before income taxes and fixed charges by (ii) fixed charges. Fixed
charges consist primarily of interest expense net of the effect of
noninterest-bearing advances. The ratio of earnings to fixed charges for
TMCC's parent, Toyota Motor Sales, U.S.A., Inc., and subsidiaries was 1.92,
1.49, 1.74, 1.90 and 2.07 for the years ended September 30, 1997, 1996,
1995, 1994 and 1993, respectively. TMCC has guaranteed payments of principal
and interest on $118 million principal amount of bonds issued in connection
with the manufacturing facilities of certain of its affiliates. The latest
maturity date of such guaranteed bonds is June 2028. As of June 30, 1998,
TMCC had incurred no fixed charges in connection with such guarantees and no
amount is included in any ratio of earnings to fixed charges.
S-4
<PAGE>
CAPITALIZATION
The following table sets forth the consolidated capitalization of TMCC at
June 30, 1998:
<TABLE>
<CAPTION>
BALANCE AT BALANCE AS
JUNE 30, 1998 ADJUSTED(3)
------------- -----------
(UNAUDITED)
(U.S. DOLLARS IN MILLIONS)
<S> <C> <C>
DEBT:(1)
Notes and loans payable within one year, net(2)..................................... $ 4,427 $ 4,263
Notes and loans payable after one year, net......................................... 13,508 15,333
------------- -----------
TOTAL DEBT............................................................................ 17,935 19,596
------------- -----------
SHAREHOLDER'S EQUITY:
Capital stock, U.S. $10,000 par value (100,000 shares authorized; 91,500 issued and
outstanding at June 30, 1998 and as adjusted) 915 915
Retained earnings................................................................... 1,258 1,258
Net unrealized gains on marketable securities....................................... 14 14
------------- -----------
TOTAL SHAREHOLDER'S EQUITY.......................................................... 2,187 2,187
------------- -----------
TOTAL CAPITALIZATION.................................................................. $ 20,122 $ 21,783
------------- -----------
------------- -----------
</TABLE>
- ------------------------
(1) Amounts are quoted in U.S. dollars and include the effect of separate cross
currency interest rate swap agreements effectively converting foreign
currency notes into fixed U.S. dollar obligations at the respective cross
currency interest rate swap agreement contract rates. See Note 4 of TMCC's
June 30, 1998 Quarterly Report on Form 10-Q incorporated by reference into
this Prospectus Supplement.
(2) Includes debt maturing within one year of June 30, 1998 and commercial
paper.
(3) As adjusted to give effect to (i) the issuance of medium-term notes totaling
U.S. $2,897,979,000 during the period July 1, 1998 through November 30,
1998, (ii) the maturity and repurchase of medium-term notes and bonds
totaling U.S. $1,237,154,000 during the period July 1, 1998 through November
30, 1998, (iii) the issuance of floating rate demand notes totaling U.S.
$66,559,000 during the period July 1, 1998 through November 30, 1998, (iv)
the maturity of floating rate demand notes totaling U.S. $37,351,000 during
the period July 1, 1998 through November 30, 1998, (v) the net decrease of
commercial paper totaling U.S. $329,091,000 during the period July 1, 1998
through November 30, 1998, and (vi) the Notes offered hereby.
S-5
<PAGE>
DESCRIPTION OF THE NOTES
The Notes will be issued as a series of debt securities under an Indenture,
dated as of August 1, 1991, as amended by the First Supplemental Indenture,
dated as of October 1, 1991 (the "Indenture"), between TMCC, The Chase Manhattan
Bank and Bankers Trust Company. The Chase Manhattan Bank will act as trustee
with respect to the Notes (the "Trustee"). The following summary of certain
provisions of the Notes and of the Indenture does not purport to be complete and
is qualified in its entirety by reference to the Indenture, a copy of which has
been filed as an exhibit to the Registration Statement of which this Prospectus
Supplement and the accompanying Prospectus are a part. Capitalized terms used
but not defined herein have the meanings given to them in the Indenture or the
Notes, as the case may be.
GENERAL
The Notes will be limited to $300,000,000 aggregate principal amount and
will mature on December 15, 2008. The Notes will bear interest from December 14
, 1998 at the rate shown on the front cover of this Prospectus Supplement,
payable semiannually on June 15 and December 15 in each year, beginning on June
15, 1999 to Holders of record on the preceding June 1 and December 1,
respectively. Interest will be calculated on the basis of a 360-day year of
twelve 30-day months.
The Notes will not be subject to redemption before maturity, by a sinking
fund or otherwise.
The Notes will be issued in denominations of US $1,000 and integral
multiples thereof.
GLOBAL NOTES, DELIVERY AND FORM
Upon issuance, all Notes will be represented by one or more fully registered
global securities (the "Global Notes"). Each such Global Note will be deposited
with, or on behalf of, The Depository Trust Company ("DTC"), as Depositary, and
registered in the name of Cede & Co. (DTC's partnership nominee). Unless and
until it is exchanged in whole or in part for Notes in definitive form, no
Global Note may be transferred except as a whole by the Depositary to a nominee
of such Depositary or by a nominee of such Depositary to such Depositary or
another nominee of such Depositary or by such Depositary or any such nominee to
a successor of such Depositary or a nominee of such successor.
So long as DTC, or its nominee, is a registered owner of a Global Note, DTC
or its nominee, as the case may be, will be considered the sole owner or Holder
of the Notes represented by such Global Note for all purposes under the
Indenture. Except as provided below, the actual owners of the Notes represented
by a Global Note (each a "Beneficial Owner") will not be entitled to have the
Notes represented by such Global Notes registered in their names, will not
receive or be entitled to receive physical delivery of the Notes in definitive
form, except as described below, and will not be considered the owners or
Holders thereof under the Indenture, including for purposes of receiving any
reports delivered by TMCC or the Trustee pursuant to the Indenture. Accordingly,
each person owning a beneficial interest in a Global Note must rely on the
procedures of DTC and, if such person is not a participant of DTC (a
"Participant"), on the procedures of the Participant through which such person
owns its interest, to exercise any rights of a Holder under the Indenture. TMCC
understands that under existing industry practices, in the event that TMCC
requests any action of Holders or that an owner of a beneficial interest in such
a Global Note desires to give or take any action which a Holder is entitled to
give or take under the Indenture, DTC would authorize the Participants holding
the relevant beneficial interests to give or take such action and such
Participants would authorize Beneficial Owners owning through such Participants
to give or take such action or would otherwise act upon the instructions of
Beneficial Owners. Conveyance of notices and other communications by DTC to
Participants, by Participants to Indirect Participants, as defined below, and by
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time. The laws of some jurisdictions require that
certain purchasers of securities take physical delivery of such securities in
S-6
<PAGE>
certificated form. Such limits and such laws may impair the ability to transfer
beneficial interests in a Global Note.
If (x) the Depositary is at any time unwilling, unable or ineligible to
continue as Depositary and a successor Depositary is not appointed by TMCC
within 60 days, (y) TMCC executes and delivers to the Trustee a Company Order to
the effect that the Global Notes shall be exchangeable for Notes in definitive
form ("Definitive Notes") or (z) an Event of Default has occurred and is
continuing with respect to the Notes, the Global Notes will be exchangeable for
Notes in definitive form of like tenor and of an equal aggregate principal
amount, in denominations of US $1,000 and integral multiples thereof. Such
Definitive Notes shall be registered in such name or names as the Depositary
shall instruct the Trustee. It is expected that such instructions may be based
upon directions received by the Depositary from Participants with respect to
ownership of beneficial interests in such Global Notes.
The following is based on information furnished by DTC:
DTC will act as securities depository for the Notes. The Notes will be
issued as fully registered securities registered in the name of Cede & Co.
(DTC's partnership nominee). One or more fully registered Global Notes will be
issued for the Notes in the aggregate principal amount of such issue, and will
be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange
Act of 1934, as amended. DTC holds securities that its Participants deposit with
DTC. DTC also facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities through
electronic computerized book-entry changes in Participants' accounts, thereby
eliminating the need for physical movement of securities certificates. Direct
Participants of DTC ("Direct Participants") include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the
National Association of Securities Dealers, Inc. Access to DTC's system is also
available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain a custodial relationship with a Direct
Participant, either directly or indirectly ("Indirect Participants"). The rules
applicable to DTC and its Participants are on file with the United States
Securities and Exchange Commission.
Purchases of Notes under DTC's system must be made by or through Direct
Participants, which will receive a credit for the Notes on DTC's records. The
ownership interest of each Beneficial Owner is in turn to be recorded on the
records of Direct Participants and Indirect Participants. Beneficial Owners will
not receive written confirmation from DTC of their purchase, but Beneficial
Owners are expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the Direct
Participants or Indirect Participants through which such Beneficial Owners
entered into the transaction. Transfers of ownership interests in the Notes are
to be accomplished by entries made on the books of Participants acting on behalf
of Beneficial Owners. Beneficial Owners will not receive certificates
representing their ownership interests in the Notes, except as provided above.
To facilitate subsequent transfers, all Notes deposited with DTC are
registered in the name of Cede & Co. The deposit of Notes with DTC and their
registration in the name of Cede & Co. effect no change in beneficial ownership.
DTC has no knowledge of the actual Beneficial Owners of the Notes; DTC's records
reflect only the identity of the Direct Participants to whose accounts such
Notes are credited, which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their holdings on
behalf of their customers and for forwarding all notices concerning the Notes to
their customers.
S-7
<PAGE>
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Neither DTC nor Cede & Co. will consent or vote with respect to the Notes.
Under its usual procedures, DTC mails an Omnibus Proxy to TMCC as soon as
possible after the applicable record date. The Omnibus Proxy assigns Cede &
Co.'s consenting or voting rights to those Direct Participants to whose accounts
the Notes are credited on the record date (identified in a listing attached to
the Omnibus Proxy).
So long as DTC, or its nominee, is a registered owner of the Global Notes,
principal and interest payments on the Notes will be made in immediately
available funds to DTC. DTC's practice is to credit Direct Participants'
accounts on the applicable payment date in accordance with their respective
holdings shown on the Depositary's records, unless DTC has reason to believe
that it will not receive payment on such date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in
bearer form or registered in "street name," and will be the responsibility of
such Participants and not of DTC, the Trustee or TMCC, subject to any statutory
or regulatory requirements as may be in effect from time to time. Payment of
principal and interest to DTC is the responsibility of TMCC or the Trustee,
disbursement of such payments to Direct Participants shall be the responsibility
of DTC, and disbursement of such payments to the Beneficial Owners shall be the
responsibility of Direct Participants and Indirect Participants.
DTC may discontinue providing its services as securities depository with
respect to the Notes at any time by giving reasonable notice to TMCC or the
Trustee. Under such circumstances, in the event that a successor securities
depository is not obtained, Note certificates are required to be printed and
delivered.
TMCC may decide to discontinue use of the system of book-entry transfers
through DTC (or a successor securities depository). In that event, Note
certificates will be printed and delivered.
DTC management is aware that some computer applications, systems, and the
like for processing data ("Systems") that are dependent upon calendar dates,
including dates before, on, and after January 1, 2000, may encounter "Year 2000
problems". DTC has informed its Participants and other members of the financial
community (the "Industry") that it has developed and is implementing a program
so that its Systems, as the same relate to the timely payment of distributions
(including principal and income payments) to securityholders, book-entry
deliveries and settlement of trades within DTC ("DTC Services"), continue to
function appropriately. This program includes a technical assessment and a
remediation plan, each of which is complete. Additionally, DTC's plan includes a
testing phase, which is expected to be completed within an appropriate time
frame.
However, DTC's ability to perform properly its services is also dependent
upon other parties, including but not limited to issuers and their agents, as
well as third party vendors from whom DTC licenses software and hardware and
third party vendors on whom DTC relies for information and the provision of
services, including telecommunication and electrical utility service providers,
among others. DTC has informed the Industry that it is contacting (and will
continue to contact) third party vendors from whom DTC acquires services to: (i)
impress upon them the importance of such services being Year 2000 compliant; and
(ii) determine the extent of their efforts for Year 2000 remediation (and, as
appropriate, testing) of their services. In addition, DTC is in the process of
developing such contingency plans as it deems appropriate.
According to DTC, the foregoing information with respect to DTC has been
provided to the Industry for informational purposes only and is not intended to
serve as a representation, warranty, or contract modification of any kind.
S-8
<PAGE>
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. All payments of principal and interest on the Notes will be
made by TMCC in immediately available funds so long as the Notes are maintained
in book-entry form.
S-9
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
dated December 9, 1998 (the "Underwriting Agreement"), TMCC has agreed to sell
to each of the underwriters named below (the "Underwriters") and each of such
Underwriters severally has agreed to purchase the principal amount of Notes set
forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
NAME NOTES
- -------------------------------------------------------------------- ------------------------
<S> <C>
Bear, Stearns & Co. Inc............................................. $ 60,000,000
Artemis Capital Group, Inc.......................................... 60,000,000
Blaylock & Partners, L.P............................................ 60,000,000
Ramirez & Co., Inc.................................................. 60,000,000
Utendahl Capital Partners, L.P...................................... 60,000,000
-------------
Total........................................................... $ 300,000,000
-------------
-------------
</TABLE>
The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the Notes are subject to, among
other things, the approval of certain legal matters, by their counsel and
certain other conditions. The Underwriters are obligated to take and pay for all
the Notes if any are taken.
The initial public offering price of the Notes and the underwriting
discounts and commissions are set forth below:
<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS PROCEEDS TO
PUBLIC AND COMMISSIONS TMCC
-------------- -------------------- --------------
<S> <C> <C> <C>
Per Note.............................. 99.802% 0.600% 99.202%
Total............................. $299,406,000 $1,800,000 $297,606,000
</TABLE>
The Underwriters have advised TMCC that they propose initially to offer all
or part of the Notes to the public at the public offering price set forth on the
cover page of this Prospectus Supplement and to certain dealers at such price
less a concession not in excess of 0.400% of the principal amount of the Notes.
The Underwriters may allow, and such dealers may reallow, a discount not in
excess of 0.200% of the principal amount of the Notes to certain other dealers.
After the initial public offering, the public offering price, concession and
discount may be changed.
TMCC estimates expenses of $90,000 associated with the offering of the
Notes.
In order to facilitate the offering of the Notes, Bear, Stearns & Co. Inc.,
or its affiliates ("Bear Stearns") may engage in transactions that stabilize,
maintain or otherwise affect the price of the Notes. Specifically, Bear Stearns
may over-allot in connection with this offering, creating short positions in the
Notes for its own account. In addition, to cover over-allotments or to stabilize
the price of the Notes, Bear Stearns may bid for, and purchase Notes in the open
market. Finally, Bear Stearns may reclaim selling concessions allowed to an
underwriter or dealer for distributing Notes in this offering, if Bear Stearns
repurchases previously distributed Notes in transactions that cover syndicate
short positions, in stabilization transactions or otherwise. Any of these
activities may stabilize or maintain the market price of the Notes above
independent market levels. Bear Stearns is not required to engage in these
activities, and may end any of these activities at any time.
Neither TMCC nor the Underwriters makes any representation or prediction as
to the direction or magnitude of any effect that the transactions described
above may have on the price of the Notes. In addition, neither TMCC nor the
Underwriters makes any representation that such transactions will be engaged in
or that such transactions, once commenced, will not be discontinued without
notice.
S-10
<PAGE>
TMCC has agreed to indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, and to
contribute to payments the Underwriters may be required to make in respect
thereof.
Certain of the Underwriters and their affiliates engage in transactions
with, and perform services for, TMCC and affiliates of TMCC in the ordinary
course of business and have engaged, and may in the future engage, in commercial
banking and/or investment banking transactions with TMCC and affiliates of TMCC.
The Notes will not have an established trading market when issued. There can
be no assurance of a secondary market for the Notes or the continued liquidity
of such market if one develops. It is not anticipated that the Notes will be
listed on any securities exchange.
S-11
<PAGE>
PROSPECTUS
[LOGO]
TOYOTA MOTOR CREDIT CORPORATION
DEBT SECURITIES
------------------
Toyota Motor Credit Corporation ("TMCC") may offer from time to time its
senior unsecured debt securities consisting of notes, debentures or other
evidences of indebtedness (the "Debt Securities"), in an aggregate principal
amount of not more than $5,031,395,000 (the initial offering price of Debt
Securities sold at a discount to face will be used for purposes of the
limitation and the face amount of Debt Securities sold at a premium to face will
be used for purposes of the limitation) or, if applicable, the equivalent
thereof in any other currency or currencies. The Debt Securities may be offered
as a single series or as two or more separate series in amounts, at prices and
on terms to be determined in light of market conditions at the time of sale and
to be set forth in a Prospectus Supplement or Prospectus Supplements.
The terms of each series of Debt Securities, including, where applicable,
the specific designation, aggregate principal amount, authorized denominations,
maturity, rate or rates and time or times of payment of any interest, any terms
for optional or mandatory redemption or payment of additional amounts or any
sinking fund provisions, the initial public offering price, the proceeds to TMCC
and any other specific terms in connection with the offering and sale of such
series will be set forth in a Prospectus Supplement or Prospectus Supplements.
As used herein, Debt Securities shall include debt securities denominated in
United States dollars or, at the option of TMCC if so specified in an applicable
Prospectus Supplement, in any other currency or in composite currencies or in
amounts determined by reference to an index.
The Debt Securities may be sold directly by TMCC, through agents designated
from time to time or to or through underwriters or dealers. See "Plan of
Distribution." If any agents of TMCC or any underwriters are involved in the
sale of any Debt Securities in respect of which this Prospectus is being
delivered, the names of such agents or underwriters and any applicable
commissions or discounts will be set forth in the applicable Prospectus
Supplement. The net proceeds to TMCC from such sale also will be set forth in
the applicable Prospectus Supplement.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement.
THE DATE OF THIS PROSPECTUS IS SEPTEMBER 3, 1998.
<PAGE>
THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH CAROLINA HAS NOT
APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE COMMISSIONER PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT HERETO.
AVAILABLE INFORMATION
TMCC is subject to the informational requirements of the United States
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports and other information with the United States
Securities and Exchange Commission (the "Commission"). Such reports and other
information can be inspected and copied at the Public Reference Room of the
Commission, at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's regional offices at 7 World Trade Center, 13th Floor, New York, New
York 10048 and Citibank Center, Suite 1800, 500 West Madison Street, Chicago,
Illinois 60661-2511. Copies of such material may also be obtained by mail from
the Public Reference Section of the Commission, at 450 Fifth Street, N.W., Room
1024, Washington, D.C. 20549 at prescribed rates. Copies of such reports and
other information may also be inspected at the offices of the New York Stock
Exchange, Inc., 20 Broad Street, New York, New York 10005, on which an issue of
TMCC's debt securities is listed. Electronic filings made through the Electronic
Gathering Analysis and Retrieval System are publicly available through the
Commission's website at http://www.sec.gov.
TMCC has filed with the Commission a Registration Statement on Form S-3
(together with all amendments and exhibits thereto, the "Registration
Statement") under the United States Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus and the accompanying Prospectus Supplement do
not contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and regulations
of the Commission. For further information, reference is made to the
Registration Statement, which may be examined without charge at the public
reference facilities maintained by the Commission at the Public Reference Room
of the Commission, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549.
Copies thereof may be obtained from the Commission upon payment of the
prescribed fees.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
TMCC's Annual Report on Form 10-K for the fiscal year ended September 30,
1997 and its Quarterly Reports on Form 10-Q for the quarters ended December 31,
1997, March 31, 1998 and June 30, 1998 are incorporated in and made a part of
this Prospectus. All documents filed by TMCC with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering of the Debt
Securities shall be deemed to be incorporated by reference herein and to be a
part hereof from the date of filing such documents. A statement contained
herein, in a Prospectus Supplement or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
in a Prospectus Supplement or in any subsequently filed document which is
incorporated by reference herein modifies or supersedes such statement. Any such
statements so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
TMCC WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS PROSPECTUS IS
DELIVERED, ON THE REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE
DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN EXHIBITS TO SUCH
DOCUMENTS, UNLESS SUCH EXHIBITS ARE SPECIFICALLY INCORPORATED BY REFERENCE INTO
THE DOCUMENTS THAT THIS PROSPECTUS INCORPORATES). REQUESTS FOR SUCH COPIES
SHOULD BE DIRECTED TO TOYOTA MOTOR CREDIT CORPORATION, 19001 SOUTH WESTERN
AVENUE, TORRANCE, CALIFORNIA 90509, ATTENTION: TREASURY, TELEPHONE NUMBER (310)
787-1310.
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TOYOTA MOTOR CREDIT CORPORATION
TMCC provides retail leasing, retail and wholesale financing and certain
other financial services to authorized Toyota and Lexus vehicle and Toyota
industrial equipment dealers and their customers in the United States (excluding
Hawaii) and the Commonwealth of Puerto Rico. TMCC is a wholly owned subsidiary
of Toyota Motor Sales, U.S.A., Inc. ("TMS"). TMS is primarily engaged in the
wholesale distribution of automobiles, light trucks, industrial equipment and
related replacement parts and accessories throughout the United States
(excluding Hawaii). Substantially all of TMS' products are either manufactured
by its affiliates or are purchased from Toyota Motor Corporation ("TMC"), the
indirect parent of TMS, or TMC's affiliates. TMCC and its subsidiaries are
collectively referred to herein as the "Company."
TMCC was incorporated in California on October 4, 1982, and commenced
operations in May 1983. TMCC's principal executive offices are located in the
TMS headquarters complex at 19001 South Western Avenue, Torrance, California
90509, and its telephone number is (310) 787-1310.
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement which accompanies
this Prospectus, the net proceeds from the sale of the Debt Securities will be
added to TMCC's general funds and will be available for the purchase of earning
assets and for the retirement of debt. Such proceeds initially may be used to
reduce short-term borrowings or may be invested in short-term securities.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities may be issued from time to time as a single series or in
two or more separate series. The following description of the terms of the Debt
Securities sets forth certain general terms and provisions of the Debt
Securities to which any Prospectus Supplement may relate. The particular terms
of the Debt Securities offered by any Prospectus Supplement (the "Offered Debt
Securities"), and the extent to which such general provisions may apply to the
Offered Debt Securities, will be described in a Prospectus Supplement relating
to such Offered Debt Securities.
The Debt Securities will be issued under an indenture, dated as of August 1,
1991, as amended and supplemented by a first supplemental indenture dated as of
October 1, 1991, as such indenture may be further amended from time to time (the
"Indenture"), between TMCC and the trustee with respect to one or more series of
Debt Securities designated in the applicable Prospectus Supplement or Prospectus
Supplements (the "Trustee"). The terms of the Debt Securities include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and holders
of the Debt Securities are referred to the Indenture and the Trust Indenture Act
for a statement thereof. The following summary of certain provisions of the Debt
Securities and of the Indenture does not purport to be complete and is qualified
in its entirety by reference to the Indenture, a copy of which has been filed as
an exhibit to the Registration Statement of which this Prospectus is a part.
Capitalized terms used but not defined herein have the meanings given to them in
the Indenture.
THE DEBT SECURITIES WILL BE OBLIGATIONS SOLELY OF TMCC AND WILL NOT BE
OBLIGATIONS OF, OR DIRECTLY OR INDIRECTLY GUARANTEED BY, TMS, TMC OR ANY OF
THEIR AFFILIATES.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities which may be issued thereunder and Debt Securities may be issued
thereunder from time to time as a single series or in two or more separate
series up to the aggregate principal amount from time to time authorized by TMCC
for each series. As of the date of this Prospectus, TMCC has authorized the
issuance under the
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<PAGE>
Indenture of up to $12,600,000,000 aggregate principal amount of debt securities
(the initial offering price of Debt Securities sold at a discount to face is
used for purposes of this limitation and the face amount of Debt Securities sold
at a premium to face is used for purposes of this limitation) of which
approximately $7,568,605,000 aggregate principal amount have previously been
issued.
The Debt Securities will be unsecured general obligations of TMCC and will
rank pari passu with all other unsecured and unsubordinated indebtedness of TMCC
from time to time outstanding.
The applicable Prospectus Supplement or Prospectus Supplements will describe
the terms of the Offered Debt Securities, including: (i) the aggregate principal
amount and denominations of such Debt Securities; (ii) the date on which such
Debt Securities will mature; (iii) the date or dates on which the principal of
such Debt Securities is payable, if other than on maturity, or the method of
determination thereof; (iv) the rate or rates per annum (which may be fixed or
variable), or the formula for determining such rate or rates, at which such Debt
Securities will bear interest, if any; (v) the dates on which such interest, if
any, will be payable; (vi) the Place of Payment or transfer with respect to such
Debt Securities; (vii) the provisions for redemption or repayment of such Debt
Securities, if any, including the redemption and/or repayment price or prices
and any remarketing arrangements relating thereto; (viii) the sinking fund
requirements or amortization provisions, if any, with respect to such Debt
Securities; (ix) whether such Debt Securities are denominated or provide for
payment in United States dollars or a foreign currency or units of two or more
currencies; (x) the form (registered or bearer or both) in which such Debt
Securities may be issued and any restrictions applicable to the exchange of one
form for another and to the offer, sale and delivery of Debt Securities in
either form; (xi) if TMCC will pay Additional Amounts in respect of Debt
Securities held by a person who is not a U.S. person in respect of specified
taxes, assessments or other governmental charges, under what circumstances TMCC
will pay such Additional Amounts and whether TMCC has the option to redeem the
affected Debt Securities rather than pay such Additional Amounts; (xii) whether
such Debt Securities will be issued in whole or in part in the form of one or
more global securities and, in such case, the Depositary for such global
securities; (xiii) the title of such Debt Securities, the series of which such
Debt Securities shall be a part and the Trustee with respect to such Debt
Securities; and (xiv) any other terms of such Debt Securities. Reference is made
to the Prospectus Supplement for the terms of the Debt Securities being offered
thereby. The variable terms of the Debt Securities are subject to change from
time to time, but no such change will affect any Debt Security already issued or
as to which an offer to purchase has been accepted by TMCC.
The provisions of the Indenture described above provide TMCC with the
ability, in addition to the ability to issue Debt Securities with terms
different from those of Debt Securities previously issued, to "reopen" a
previous issue or a series of Debt Securities and issue additional Debt
Securities of such issue or series.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement, payment
of principal of and premium and interest, if any, on Debt Securities will be
made at the office of such Paying Agent or Paying Agents as TMCC may designate
from time to time, except that at the option of TMCC payment of any interest may
be made (i) by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register or (ii) by wire transfer to
an account maintained by the Person entitled thereto as specified in the
Security Register. Unless otherwise indicated in an applicable Prospectus
Supplement, payment of any installment of interest on Debt Securities will be
made to the Person in whose name such Debt Security is registered at the close
of business on the Regular Record Date for such interest.
Unless otherwise indicated in an applicable Prospectus Supplement, the
Trustee with respect to the Debt Securities of the related series, acting
through its Corporate Trust Office, will be designated
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<PAGE>
as TMCC's sole Paying Agent for payments with respect to Debt Securities of such
series. TMCC may at any time designate additional Paying Agents or rescind the
designation of any Paying Agent or approve a change in the office through which
any Paying Agent acts, except that TMCC will be required to maintain a Paying
Agent in each Place of Payment for such series. All moneys paid by TMCC to a
Paying Agent for the payment of principal of or premium or interest, if any, on
any Debt Security which remain unclaimed at the end of one year after such
principal, premium or interest shall have become due and payable will be repaid
to TMCC, and the Holder of such Debt Security or any coupon will thereafter look
only to TMCC for payment thereof.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in global
form. A Debt Security in global form will be deposited with, or on behalf of, a
Depositary, which will be identified in an applicable Prospectus Supplement. A
global Debt Security may be issued in either registered or bearer form and in
either temporary or permanent form. A Debt Security in global form may not be
transferred except as a whole by the Depositary for such Debt Security to a
nominee of such Depositary or by a nominee of such Depositary to such Depositary
or another nominee of such Depositary or by such Depositary or any such nominee
to a successor of such Depositary or a nominee of such successor. If any Debt
Securities of a series are issuable in global form, the applicable Prospectus
Supplement will describe the circumstances, if any, under which beneficial
owners of interests in any such global Debt Security may exchange such interests
for definitive Debt Securities of such series and of like tenor and principal
amount in any authorized form and denomination, the manner of payment of
principal of, premium and interest, if any, on any such global Debt Security and
the material terms of the depositary arrangement with respect to any such global
Debt Security.
CERTAIN COVENANTS
The Debt Securities will not be secured by mortgage, pledge or other lien.
TMCC has covenanted in the Indenture not to pledge or otherwise subject to any
lien any property or assets of TMCC unless the Debt Securities are secured by
such pledge or lien equally and ratably with all other obligations secured
thereby so long as such obligations shall be so secured; provided, however, that
such covenant does not apply to liens securing obligations which do not in the
aggregate at any one time outstanding exceed 5% of Consolidated Net Tangible
Assets (as defined below) of TMCC and its consolidated subsidiaries and also
does not apply to:
(a) the pledge of any assets of TMCC to secure any financing by TMCC of
the exporting of goods to or between, or the marketing thereof in, countries
other than the United States in connection with which TMCC reserves the
right, in accordance with customary and established banking practice, to
deposit, or otherwise subject to a lien, cash, securities or receivables for
the purpose of securing banking accommodations or as the basis for the
issuance of bankers' acceptances or in aid of other similar borrowing
arrangements;
(b) the pledge of receivables payable in currencies other than United
States dollars to secure borrowings in countries other than the United
States;
(c) any deposit of assets of TMCC with any surety company or clerk of
any court, or in escrow, as collateral in connection with, or in lieu of,
any bond on appeal by TMCC from any judgment or decree against it, or in
connection with other proceedings in actions at law or in equity by or
against TMCC or in favor of any governmental bodies to secure progress,
advance or other payments in the ordinary course of TMCC's business;
(d) any lien or charge on any property of TMCC, tangible or intangible,
real or personal, existing at the time of acquisition or construction of
such property (including acquisition through merger or consolidation) or
given to secure the payment of all or any part of the purchase or
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<PAGE>
construction price thereof or to secure any indebtedness incurred prior to,
at the time of, or within one year after, the acquisition or completion of
construction thereof for the purpose of financing all or any part of the
purchase or construction price thereof;
(e) any lien in favor of the United States of America or any state
thereof or the District of Columbia, or any agency, department or other
instrumentality thereof, to secure progress, advance or other payments
pursuant to any contract or provision of any statute;
(f) any lien securing the performance of any contract or undertaking not
directly or indirectly in connection with the borrowing of money, obtaining
of advances or credit or the securing of debt, if made and continuing in the
ordinary course of business;
(g) any lien to secure non-recourse obligations in connection with
TMCC's engaging in leveraged or single-investor lease transactions; and
(h) any extension, renewal or replacement (or successive extensions,
renewals or replacements), in whole or in part, of any lien, charge or
pledge referred to in clauses (a) through (g) above, provided, however, that
the amount of any and all obligations and indebtedness secured thereby will
not exceed the amount thereof so secured immediately prior to the time of
such extension, renewal or replacement, and that such extension, renewal or
replacement will be limited to all or a part of the property which secured
the charge or lien so extended, renewed or replaced (plus improvements on
such property).
"Consolidated Net Tangible Assets" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after deducting
therefrom (i) all current liabilities and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and other like
intangibles of TMCC and its consolidated subsidiaries, all as set forth on the
most recent balance sheet of TMCC and its consolidated subsidiaries prepared in
accordance with generally accepted accounting principles as practiced in the
United States.
SUCCESSOR CORPORATION
The Indenture provides that TMCC may consolidate with, or sell, lease or
convey all or substantially all of its assets to, or merge with or into, any
other corporation, provided, that in any such case: (i) either TMCC shall be the
continuing corporation, or the successor corporation shall be a corporation
organized and existing under the laws of the United States or any state thereof
and shall expressly assume, by a supplemental indenture, executed and delivered
to each Trustee, in form satisfactory to each Trustee, all of the obligations of
TMCC under the Debt Securities and the Indenture; and (ii) TMCC or such
successor corporation, as the case may be, shall not, immediately after such
merger or consolidation, or such sale, lease or conveyance, be in default in the
performance of any such obligation. Subject to certain limitations in the
Indenture, a Trustee may receive from TMCC an officer's certificate and an
opinion of counsel as conclusive evidence that any such consolidation, merger,
sale, lease or conveyance, and any such assumption, complies with the provisions
of the Indenture.
SUPPLEMENTAL INDENTURES
Supplemental indentures may be entered into by TMCC and the appropriate
Trustee with the consent of the Holders of 66 2/3% in principal amount of any
series of outstanding Debt Securities, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Indenture or of modifying in any manner the rights of the Holders of each such
series affected by such modification or amendment, provided that no supplemental
indenture may, among other things, reduce the principal amount of or interest on
any Debt Securities, change the maturity date of the principal, the interest
payment dates or other terms of payment or reduce the percentage
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in principal amount of outstanding Debt Securities of any series the consent of
whose Holders is necessary to modify or alter the Indenture, without the consent
of each Holder of Debt Securities affected thereby. Under certain circumstances,
supplemental indentures may also be entered into without the consent of the
Holders.
EVENTS OF DEFAULT
The Indenture defines an Event of Default with respect to any series of Debt
Securities as being any one of the following events and such other events as may
be established for the Debt Securities of a particular series: (i) default in
payment of principal on the Debt Securities of such series; (ii) default in
payment of any interest on the Debt Securities of such series and continuance of
such default for a period of 30 days; (iii) default in the deposit of any
sinking fund payment with respect to Debt Securities of such series when and as
due; (iv) default in the performance, or breach, of any other covenant or
warranty of TMCC in the Indenture (other than a covenant or warranty included in
the Indenture solely for the benefit of a series of Debt Securities other than
such series) continued for 60 days after appropriate notice; and (v) certain
events of bankruptcy, insolvency or reorganization. No Event of Default with
respect to a particular series of Debt Securities issued under the Indenture
necessarily constitutes an Event of Default with respect to any other series of
Debt Securities issued thereunder. If an Event of Default occurs and is
continuing, the appropriate Trustee or the Holders of at least 25% in aggregate
principal amount of Debt Securities of each series affected thereby may declare
the Debt Securities of such series to be due and payable. Any past default with
respect to a particular series of Debt Securities may be waived by the Holders
of a majority in aggregate principal amount of the outstanding Debt Securities
of such series, except in a case of failure to pay principal of, or premium, if
any, or interest on such Debt Securities for which payment had not been
subsequently made or a default in respect of a covenant or provision of the
Indenture which cannot be modified or amended without the consent of the Holder
of each outstanding Debt Security of such series. TMCC will be required to file
with each Trustee annually an officer's certificate as to the absence of certain
defaults. The appropriate Trustee may withhold notice to Holders of any series
of Debt Securities of any default with respect to such series (except in payment
of principal, premium, if any, or interest) if it in good faith determines that
it is in the interest of such Holders to do so.
Subject to the provisions of the Indenture relating to the duties of a
Trustee in case an Event of Default shall occur and be continuing, a Trustee
will be under no obligation to exercise any of its rights or powers under the
Indenture at the request or direction of any of the Holders, unless such Holders
have offered to such Trustee reasonable indemnity or security against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction. Subject to provisions in the Indenture for the
indemnification of a Trustee and to certain other limitations, the Holders of a
majority in principal amount of the outstanding Debt Securities of any series
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the appropriate Trustee, or exercising
any trust or power conferred on such Trustee with respect to the Debt Securities
of such series.
SATISFACTION AND DISCHARGE OF INDENTURE
The Indenture will be discharged with respect to the Debt Securities of any
series upon the satisfaction of certain conditions, including the payment in
full of the principal of, and premium, if any, and interest on all of the Debt
Securities of such series or the deposit with the appropriate Trustee of an
amount in cash or United States government obligations sufficient for such
payment or redemption, in accordance with the Indenture.
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DEFEASANCE
TMCC may terminate certain of its obligations under the Indenture with
respect to the Debt Securities of any series, including its obligations to
comply with the restrictive covenants set forth in the Indenture (see "Certain
Covenants") with respect to the Debt Securities of such series, on the terms and
subject to the conditions contained in the Indenture, by depositing in trust
with the appropriate Trustee cash or United States government obligations
sufficient to pay the principal of, and premium, if any, and interest on the
Debt Securities of such series to their maturity in accordance with the terms of
the Indenture and the Debt Securities of such series. In such event, the
appropriate Trustee will receive an opinion of counsel stating that such deposit
and termination will not have any federal income tax consequences to the
Holders.
REGARDING THE TRUSTEES
The Indenture contains certain limitations on the right of a Trustee, should
it become a creditor of TMCC, to obtain payment of claims in certain cases, or
to realize on certain property received in respect of any such claim as security
or otherwise. A Trustee is permitted to engage in other transactions with TMCC;
provided, however, that if a Trustee acquires any conflicting interest it must
eliminate such conflict or resign.
The Indenture provides that, in case an Event of Default has occurred and is
continuing, a Trustee is required to use the degree of care and skill of a
prudent person in the conduct of his or her own affairs in the exercise of its
powers.
GOVERNING LAW
The Indenture and the Debt Securities will be governed by and construed in
accordance with the laws of the State of New York.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth TMCC's ratio of earnings to fixed charges for
the periods shown.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
JUNE 30, SEPTEMBER 30,
------------------- ----------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
RATIO OF EARNINGS TO
FIXED CHARGES(1)........ 1.24 1.32 1.31 1.32 1.42 1.60 1.56
</TABLE>
- ------------------------
(1) The ratio of earnings to fixed charges was computed by dividing (i) the sum
of income before income taxes and fixed charges by (ii) fixed charges. Fixed
charges consist primarily of interest expense net of the effect of
noninterest-bearing advances. In March 1987, TMCC guaranteed payments of
principal and interest on $58 million principal amounts of bonds issued in
connection with the Kentucky manufacturing facility of an affiliate. As of
June 30, 1998, TMCC has not incurred any fixed charges in connection with
such guarantee and no amount is included in any ratio of earnings to fixed
charges. Effective June 17, 1998, TMCC has guaranteed payments of principal
and interest on $40 million principal amount of flexible rate demand solid
waste disposal revenue bonds issued by Putnam County, West Virginia,
maturing in June 2028, issued in connection with the West Virginia
manufacturing facility subsidiary of Toyota Motor Manufacturing, U.S.A.,
Inc., an affiliate of TMCC.
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PLAN OF DISTRIBUTION
TMCC may sell the Debt Securities through underwriters or agents or directly
to purchasers. A Prospectus Supplement will set forth the names of such
underwriters or agents, if any.
The Debt Securities may be sold to underwriters for their own account and
may be resold to the public from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale. A Prospectus Supplement will set
forth any underwriting discounts and other items constituting underwriters'
compensation, any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers.
The Debt Securities may be sold directly by TMCC, or through agents
designated by TMCC from time to time. A Prospectus Supplement will set forth any
commission payable by TMCC to such agent. Unless otherwise indicated in the
Prospectus Supplement, any such agent will be acting on a reasonable efforts
basis for the period of its appointment.
The net proceeds to TMCC from the sale of the Debt Securities will be the
purchase price of the Debt Securities less any such discounts or commissions and
the other attributable expenses of issuance and distribution.
TMCC will agree to indemnify underwriters and agents against certain civil
liabilities, including liabilities under the Securities Act, or contribute to
payments underwriters or agents may be required to make in respect thereof.
LEGAL MATTERS
The validity of the Debt Securities offered hereby will be passed upon for
TMCC by Alan Cohen, Esq., General Counsel of TMCC. Unless otherwise specified in
an applicable Prospectus Supplement, O'Melveny & Myers LLP will act as counsel
for the underwriters or agents, if any.
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference to the Annual Report on Form 10-K of TMCC for the year ended September
30, 1997, have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
With respect to the unaudited consolidated financial information of TMCC for
the three-month periods ended December 31, 1997 and 1996, the three- and
six-month periods ended March 31, 1998 and 1997, and the three- and nine-month
periods ended June 30, 1998 and 1997, incorporated by reference in this
Prospectus, PricewaterhouseCoopers LLP reported that they have applied limited
procedures in accordance with professional standards for a review of such
information. However, their separate reports dated February 12, 1998, May 7,
1998 and August 13, 1998, incorporated by reference herein, state that they did
not audit and they do not express an opinion on that unaudited consolidated
financial information. PricewaterhouseCoopers LLP has not carried out any
significant or additional audit tests beyond those which would have been
necessary if their reports had not been incorporated by reference. Accordingly,
the degree of reliance on their reports on such information should be restricted
in light of the limited nature of the review procedures applied.
PricewaterhouseCoopers LLP is not subject to the liability provisions of section
11 of the Securities Act for their reports on the unaudited consolidated
financial information because those reports are not "reports" or a "part" of the
registration statement prepared or certified by PricewaterhouseCoopers LLP
within the meaning of sections 7 and 11 of the Securities Act.
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