DISTRIBUTION AGREEMENT

 

 

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                                                                           FINAL

 

 

 

                         TOYOTA MOTOR CREDIT CORPORATION

 

                           Medium-Term Notes, Series B

                    Due More Than One Year From Date of Issue

 

 

 

                             DISTRIBUTION AGREEMENT

 

 

                                  April 2, 2004

 

 

MERRILL LYNCH, PIERCE, FENNER

& SMITH INCORPORATED

Merrill Lynch World Headquarters

4 World Financial Center   Floor 15

New York, New York   10080

 

 

CITIGROUP GLOBAL MARKETS INC.

388 Greenwich Street

New York , New York 10013

 

 

CREDIT SUISSE FIRST BOSTON LLC

11 Madison Avenue

New York, New York 10010

 

 

J.P. MORGAN SECURITIES INC.

60 Wall Street

New York, New York   10154

 

 

MORGAN STANLEY & CO. INCORPORATED

1585 Broadway, 2nd Floor

New York, New York   10036

 

 

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Ladies and Gentlemen:

 

     Toyota Motor Credit Corporation, a California corporation (the "Company")

confirms its agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated

("Merrill Lynch"), Citigroup Global Markets Inc. ("Citigroup"), Credit Suisse

First Boston LLC ("CSFB"), J.P. Morgan Securities Inc. ("J.P. Morgan"), and

Morgan Stanley & Co. Incorporated ("Morgan Stanley") (collectively, the

"Agents"), with respect to the issue and sale by the Company of its Medium-Term

Notes, Series B, Due More Than One Year From Date of Issue (the "Notes"). The

Notes are to be issued pursuant to an indenture (as the same may be amended or

restated from time to time, the "Indenture") dated as of August 1, 1991, as

amended by the First Supplemental Indenture, dated as of October 1, 1991 and the

Second Supplemental Indenture, dated as of March 31, 2004 among the Company,

JPMorgan Chase Bank (as successor to The Chase Manhattan Bank, N.A.) and

Deutsche Bank Trust Company Americas (formerly known as Bankers Trust Company).

Deutsche Bank Trust Company Americas will act as trustee with respect to the

Notes (the "Trustee"). This Distribution Agreement shall be referred to

hereafter as this "Agreement." The parties hereto previously entered into a

First Amended and Restated Distribution Agreement dated September 3, 1998, which

was amended by Amendment No. 1 thereto dated January 12, 2000, Amendment No. 2

thereto dated August 24, 2001, and Amendment No. 3 thereto dated April 4, 2002

(as amended, the "Original Agreement"), with respect to the Company's

Medium-Term Notes Due More Than One Year From Date of Issue (the "Original

Notes"), and the parties have agreed not to offer and sell any additional

Original Notes pursuant to the Original Agreement after the date hereof.

 

     As of the date hereof, the Company has authorized the issuance and sale by

the Company directly or through the Agents pursuant to the terms of this

Agreement of up to $7,000,000,000 (or its equivalent based on the applicable

exchange rate at the time of issuance, in such foreign currencies or units of

two or more currencies as the Company shall designate at the time of issuance)

aggregate principal amount of Notes, provided that, in calculating the aggregate

principal amount of Notes authorized, with respect to Notes issued at a discount

to face, the initial offering price shall be used, and with respect to Notes

issued at a premium to face, the face amount of such Notes shall be used. It is

understood, however, that the Company may from time to time, pursuant to an

Officer's Certificate delivered to the Trustee pursuant to Section 301 of the

Indenture (with an original copy thereof delivered to the Agents), reduce the

authorized aggregate initial offering price of the Notes (but not below the

aggregate initial offering price of Notes previously issued under the Indenture)

or authorize the issuance of additional Notes and that such additional Notes may

be distributed directly by the Company or through or to the Agents pursuant to

the terms of this Agreement, all as though the issuance of such Notes were

authorized as of the date hereof.

 

     This Agreement provides both for the sale of Notes by the Company directly

to purchasers, in which case the Agents will act as agents of the Company in

soliciting Note purchases, and (as may from time to time be agreed to by the

Company and the related Agent or Agents) to one or more Agents as principal for

resale to purchasers.

 

     The Company has filed with the Securities and Exchange Commission (the

"Commission") a registration statement on Form S-3 (No. 333-113680) for the

registration of debt securities, including the Notes, under the Securities Act

of 1933, as amended (the "1933

 

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Act") and the offering thereof from time to time in accordance with Rule 415 of

the rules and regulations of the Commission under the 1933 Act (the "1933 Act

Regulations"). Such registration statement has been declared effective by the

Commission and the Indenture has been qualified under the Trust Indenture Act of

1939, as amended (the "1939 Act"). Such registration statement (and any further

registration statements which may be filed by the Company for the purpose of

registering additional Notes and in connection with which this Agreement is

included or incorporated by reference as an exhibit) and the prospectus

constituting a part thereof, and any prospectus supplements relating to the

Notes, including all documents incorporated therein by reference, as from time

to time amended or supplemented by the filing of documents pursuant to the

Securities Exchange Act of 1934 (the "1934 Act") or the 1933 Act or otherwise,

are referred to herein as the "Registration Statement" and the "Prospectus",

respectively, except that if any revised prospectus shall be provided to the

Agents by the Company for use in connection with the offering of the Notes which

is not required to be filed by the Company pursuant to Rule 424(b) of the 1933

Act Regulations, the term "Prospectus" shall refer to such revised prospectus

from and after the time it is first provided to the Agents for such use;

provided that if the Company files a registration statement with the Commission

pursuant to Rule 462(b) of the 1933 Act Regulations (the "Rule 462(b)

Registration Statement"), then, after such filing, all references to the

"Registration Statement" shall also be deemed to include the Rule 462(b)

Registration Statement. For purposes of this Agreement, all references to the

Registration Statement, Prospectus or preliminary prospectus or to any amendment

or supplement thereto shall be deemed to include any copy filed with the

Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval

system ("EDGAR").

 

SECTION 1. Appointment as Agents.

 

     (a) Appointment of Agents. Subject to the terms and conditions stated

herein, the Company hereby appoints the Agents, except as otherwise provided in

this Section 1(a), as the exclusive agents, subject to the provisions contained

in this Section 1(a), for the purpose of soliciting purchases of the Notes from

the Company by others and agrees that, except as otherwise contemplated herein,

whenever the Company determines to sell Notes directly to one or more Agents as

principal for resale to others, it will enter into a Terms Agreement (as

hereafter defined) relating to each such sale in accordance with the provisions

of Section 3(b) hereof if requested by such Agent. The Company agrees that,

except as otherwise provided in this Section 1(a), during the period the Agents

are acting as the Company's agents hereunder, the Company will not engage any

other party to assist in the placement of the Notes (other than any person or

entity which, by executing a counterpart of this Agreement, becomes an Agent

hereunder). Notwithstanding the foregoing, the Company reserves the right to (i)

appoint additional agents for the purpose of assisting in the placement of the

Notes during the term of this Agreement under the terms of an agreement

substantially identical to this Agreement (provided that the commission to be

paid to such additional agents in connection with the sale of any Note shall be

the applicable commission determined pursuant to Section 3(a) hereof), and (ii)

sell Notes to one or more underwriters in a discrete principal transaction or

transactions (whether on an individual or syndicated basis) so long as such

underwriter or underwriters shall execute an agreement substantially identical

to this Agreement relating to such principal transaction or transactions (such

person and/or entity described in subclause (ii) of this sentence shall be

referred to herein as a "Dealer"), provided however, that no such agreement will

appoint any such underwriter an agent under this Agreement except as relates to

the related transaction or

 

 

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transactions. As used herein, the term "Agent", in addition to Merrill Lynch,

Citigroup, CSFB, J.P. Morgan, and Morgan Stanley, refers to each person or

entity which, at any particular time, is an agent or underwriter, as the case

may be, for the Company hereunder as evidenced by its execution of a counterpart

of this Agreement.

 

     (b) Reasonable Efforts Solicitations; Right to Reject Offers. Upon receipt

of instructions from the Company, the Agents will use their reasonable efforts

to solicit purchases of such principal amount of Notes as the Company and the

Agents shall agree upon from time to time during the term of this Agreement, it

being understood that the Company shall not approve the solicitation of

purchases of Notes in excess of the amount which shall be authorized by the

Company from time to time or in excess of the initial offering price of Notes

registered pursuant to the Registration Statement. The Agents will have no

responsibility for maintaining records with respect to the aggregate initial

offering price of Notes sold, or of otherwise monitoring the availability of

Notes for sale under the Registration Statement. Each Agent will communicate to

the Company, orally or in writing, each offer to purchase Notes, other than

those offers rejected by such Agent. Each Agent shall have the right, in its

discretion reasonably exercised, to reject any proposed purchase of Notes, as a

whole or in part, and any such rejection shall not be deemed a breach of the

Agent's agreement contained herein. The Company may accept or reject any

proposed purchase of the Notes, in whole or in part.

 

     (c) Solicitations as Agents; Purchases as Principals. In soliciting

purchases of the Notes on behalf of the Company, unless otherwise specified

pursuant to the terms hereof, each Agent shall act solely as agent for the

Company and not as principal. Each Agent shall make reasonable efforts to assist

the Company in obtaining performance by each purchaser whose offer to purchase

Notes has been solicited by such Agent and accepted by the Company. No Agent

shall have any liability to the Company in the event any such purchase is not

consummated for any reason. No Agent shall have any obligation to purchase notes

from the Company as principal but such Agent, individually or as part of a

syndicate with other Agents and/or Dealers, may agree from time to time to

purchase Notes as principal. Any such purchase of Notes by an Agent as principal

shall be made pursuant to a Terms Agreement in accordance with Section 3(b)

hereof if requested by such Agent. If the Company shall default on its

obligation to deliver Notes to a purchaser whose offer has been solicited by

such Agent on any agency basis and accepted by the Company due to its refusal to

perform or because of a breach of representation or warranty contained herein,

the Company shall (i) hold such Agent harmless against any loss, claim or damage

arising from or as a result of such default by the Company and (ii) pay to such

Agent any commission to which it would otherwise be entitled absent such

default.

 

     (d) Reliance. The Company and the Agents agree that any Notes the placement

of which the Agents arrange shall be placed by the Agents, and any Notes

purchased by the Agents shall be purchased, in reliance on the representations,

warranties, covenants and agreements of the Company contained herein and on the

terms and conditions and in the manner provided herein.

 

 

 

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SECTION 2. Representations and Warranties.

 

     (a) The Company represents and warrants to each Agent as of the date

hereof, as of the date of each acceptance by the Company of an offer for the

purchase of Notes (whether through the Agents as agents or to one or more Agents

as principal), as of the date of each delivery of Notes (whether through the

Agents as agents or to one or more Agents as principal) (the date of each such

delivery to one or more Agents as principal being hereafter referred to as a

"Settlement Date"), and as of any time that the Registration Statement or the

Prospectus shall be amended or supplemented (other than by an amendment or

supplement providing solely for the establishment of or a change in, the

interest rates, maturity, price or other terms of Notes or similar changes) or

there is filed with the Commission any document incorporated by reference into

the Prospectus (other than any Current Report on Form 8-K relating exclusively

to the issuance of debt securities under the Registration Statement other than

the Notes) (each of the times referenced above being referred to herein as a

"Representation Date") as follows:

 

     (i) Registration Statement and Prospectus. At the time the Registration

     Statement became effective, the Registration Statement complied, and as of

     the applicable Representation Date will comply, in all material respects

     with the applicable requirements of the 1933 Act and the 1933 Act

     Regulations and the 1939 Act and the rules and regulations of the

     Commission promulgated thereunder and no stop order suspending the

     effectiveness of the Registration Statement (including any Rule 462(b)

     Registration Statement) has been issued under the 1933 Act and no

     proceedings for that purpose have been instituted or are pending or, to the

     knowledge of the Company, are contemplated by the Commission, and any

     request on the part of the Commission for additional information has been

      complied with; and the Indenture has been duly qualified under the 1939

     Act. The Registration Statement (including any Rule 462(b) Registration

     Statement) at the time it became effective did not, and at each time

     thereafter at which any amendment to the Registration Statement (including

     any Rule 462(b) Registration Statement) becomes effective or any Annual

     Report on Form 10-K is filed by the Company with the Commission and as of

     the applicable Representation Date, will not, considering the Registration

     Statement and all Incorporated Documents (as defined in Section 5(a)(4))

     considered as a whole, contain an untrue statement of a material fact or

     omit to state a material fact required to be stated therein or necessary to

     make the statements therein not misleading. The Prospectus, as of the date

     hereof does not, and as of the applicable Representation Date will not,

     contain an untrue statement of a material fact or omit to state a material

     fact necessary in order to make the statements therein, in the light of the

     circumstances under which they were made, not misleading; provided,

     however, that the representations and warranties in this subsection shall

     not apply to statements in or omissions from the Registration Statement or

     Prospectus made in reliance upon and in conformity with information

     furnished to the Company in writing by the Agents expressly for use in the

     Registration Statement or Prospectus or to those parts of the Registration

     Statement which constitute the Statements of Eligibility under the 1939 Act

     on Form T-1. Each Prospectus delivered to the applicable agent for use in

     connection with the offering of the Notes is identical to any

      electronically

 

 

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     transmitted copies thereof filed with the Commission pursuant to EDGAR,

     except to the extent permitted by Regulation S-T.

 

     (ii) Incorporated Documents. The documents incorporated by reference in the

     Prospectus, at the time they were filed with the Commission, complied in

     all material respects with the requirements of the 1934 Act and the rules

     and regulations promulgated thereunder (the "1934 Act Regulations"), and,

     when read together and with the other information in or incorporated by

     reference in the Prospectus, did not contain any untrue statement of a

     material fact or omit to state a material fact required to be stated

     therein or necessary in order to make the statements therein, in the light

     of the circumstances under which they were made, not misleading.

 

     (iii) Accountants. The accountants who certified the financial statements

     included or incorporated by reference in the Prospectus are independent

     public accountants within the meaning of the 1933 Act and the 1933 Act

     Regulations.

 

     (iv) Financial Statements. The financial statements and any supporting

     schedules of the Company and its consolidated subsidiaries included or

     incorporated by reference in the Registration Statement and the Prospectus

     present fairly the consolidated financial position of the Company and its

     consolidated subsidiaries as of the dates indicated and the consolidated

     results of their operations for the periods specified; and, except as

     stated therein, said financial statements have been prepared in conformity

     with generally accepted accounting principles in the United States applied

     on a consistent basis; and any supporting schedules included or

     incorporated by reference in the Registration Statement present fairly the

     information required to be stated therein.

 

     (v) Due Incorporation; Authorization and Validity of this Agreement, the

     Indenture and the Notes. The Company (A) has been duly incorporated and is

     validly existing as a corporation in good standing under the laws of the

     State of California with corporate power and authority to own, lease and

     operate its properties and to conduct its business as described in the

     Prospectus, (B) has the requisite corporate power and authority to execute

     and deliver this Agreement, any Terms Agreement, the Indenture and the

     Notes and to perform its obligations hereunder and thereunder, (C) has duly

     authorized, executed and delivered this Agreement and any Terms Agreement

     and each of this Agreement and such Terms Agreement constitutes the valid

     and binding agreement of the Company, and (D) is duly qualified as a

     foreign corporation to transact business and is in good standing in each

     jurisdiction in which its ownership or lease of substantial properties or

     the conduct of its business requires such qualification and in which the

     failure to do so would materially adversely affect the business or

     financial condition of the Company.

 

     (vi) Material Changes or Material Transactions. Since the respective dates

     as of which information is given in the Registration Statement and the

     Prospectus, except as otherwise Stated therein, (A) there has been no

     material adverse change

 

 

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     in the condition, financial or otherwise, or in the earnings, business

     affairs or business prospects of the Company and its subsidiaries

     considered as one enterprise, whether or not arising in the ordinary course

     of business, (B) there have been no transactions entered into by the

     Company or any of its subsidiaries, other than those in the ordinary course

     of business (which includes, but is not limited to, Euromarket, Euro Asian

     or global financing and domestic private placement and public financing),

     which are material with respect to the Company and its subsidiaries

     considered as one enterprise, and (C) since the date of the most recent

     audited financial statements of the Company, there has been no dividend or

     distribution of any kind declared, paid or made by the Company on any class

     of its capital stock except as otherwise described in an Incorporated

     Document or as disclosed in the documentation relating to a particular

     issuance of Notes, including the applicable pricing supplement.

 

     (vii) Significant Subsidiaries. Each "significant subsidiary", if any, of

     the Company (as such term is defined in Rule 1-02 of Regulation S-X under

     the 1933 Act) (each a "Subsidiary" and, collectively, the "Subsidiaries")

     has been duly organized and is validly existing as a corporation in good

     standing under the laws of the jurisdiction of its incorporation, has the

     corporate power and authority to own, lease and operate its properties and

     to conduct its business as described in the Prospectus and is duly

     qualified as a foreign corporation to transact business and is in good

     standing in each jurisdiction in which such qualification is required,

     whether by reason of the ownership or leasing of property or the conduct of

     business, except where the failure so to qualify or to be in good standing

     would not materially affect the business or financial condition of the

     Company; except as otherwise disclosed in the Prospectus, all of the issued

     and outstanding capital stock of each such Subsidiary has been duly

     authorized and validly issued, is fully paid and non-assessable and is

     owned by the Company, directly or through subsidiaries, free and clear of

     any security interest, mortgage, pledge, lien, encumbrance, claim or

     equity; none of the outstanding shares of capital stock of any Subsidiary

     was issued in violation of preemptive or similar rights of any

     securityholder of such Subsidiary.

 

     (viii) The Indenture. The Indenture has been duly and validly authorized,

     executed and delivered by the Company and assuming it has been duly and

     validly authorized, executed and delivered by the Trustee, constitutes a

     legally valid and binding obligation of the Company, enforceable against

     the Company in accordance with its terms, except as may be limited by (1)

     bankruptcy, insolvency reorganization, moratorium or similar laws affecting

     creditors' rights generally (including, without limitation, fraudulent

     conveyance laws) or the application of general principles of equity,

     including without limitation, concepts of materiality, reasonableness, good

     faith and fair dealing and the possible unavailability of specific

     performance or injunctive relief, regardless of whether considered in a

     proceeding in equity or at law, (2) requirements that a claim with respect

     to any Notes payable in foreign or composite currency (or a foreign or

     composite currency judgement in respect of such claim) be converted into

     U.S. dollars at a rate of exchange prevailing on a date determined pursuant

     to applicable law or (3)

 

 

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     governmental authority to limit, delay or prohibit the making of payments

     outside the United States.

 

     (ix) The Notes. The Notes have been duly and validly authorized by the

     Company for issuance, offer and sale pursuant to this Agreement and, when

     completed as contemplated by the Procedures (hereinafter defined),

     executed, authenticated and delivered pursuant to the provisions of the

     Indenture and this Agreement against payment of the consideration set forth

     in the Prospectus or pursuant to any Terms Agreement, will constitute

     legally valid and binding obligations of the Company enforceable against

     the Company in accordance with their terms, except as may be limited by (1)

     bankruptcy, insolvency, reorganization, moratorium or similar laws

     affecting creditors' rights generally (including, without limitation,

     fraudulent conveyance laws) or by the application of general principles of

     equity, including without limitation, concepts of materiality,

     reasonableness, good faith and fair dealing and the possible unavailability

     of specific performance or injunctive relief, regardless of whether

     considered in a proceeding in equity or at law, (2) requirements that a

     claim with respect to any Notes payable in foreign or composite currency

     (or a foreign or composite currency judgement in respect of such claim) be

     converted into U.S. dollars at a rate of exchange prevailing on a date

     determined pursuant to applicable law or (3) governmental authority to

     limit, delay or prohibit the making of payments outside the United States

     and will be entitled to the benefits of the Indenture; and the Notes and

     the Indenture conform in all material respects to all statements relating

     thereto contained in the Registration Statement.

 

     (x) No Defaults; Compliance with Laws; Regulatory Approvals. Neither the

     Company nor any of its Subsidiaries is in violation of its charter or

     bylaws or in default in the performance or observance of any obligation,

     agreement, covenant or condition contained in any contract, indenture,

     mortgage, loan agreement, note, lease or other instrument to which the

     Company or any Subsidiaries is a party or by which it may be bound, or to

     which any of the property or assets of the Company or any of its

     Subsidiaries is subject, which violation or default would materially

     adversely affect the business or financial condition of the Company and its

     Subsidiaries considered as one enterprise; and the execution, delivery and

     performance of this Agreement, any Terms Agreement and the Indenture and

     the consummation of the transactions contemplated herein and therein will

     not conflict with, or constitute a breach of, or default under, or result

     in the creation or imposition of any lien, charge or encumbrance upon any

     property or assets of the Company or any of its Subsidiaries pursuant to,

     any material contract, indenture, mortgage, loan agreement, note, lease or

     other instrument to which the Company or any of its Subsidiaries is a party

     or by which it may be bound, or to which any of the property or assets of

     the Company or any of its Subsidiaries is subject, nor will such action

     result in any violation of the provisions of the charter or bylaws of the

     Company or any of its Subsidiaries or, to the best knowledge of the Company

     or any of its Subsidiaries, any law, administrative regulation or

     administrative or court decree, and no consent, approval, authorization,

     order or decree of any court or governmental agency or body of the United

     States is

 

 

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     required for the consummation by the Company of the transactions

     contemplated by this Agreement, any Terms Agreement or the Indenture,

     except such as may be required under the 1933 Act or the 1933 Act

     Regulations or the 1939 Act or the 1939 Act Regulations or as may be

     required by state securities or Blue Sky laws.

 

     (xi) Legal Proceedings; Contracts. Except as set forth in the Registration

     Statement, there is no action, suit or proceeding before or by any court or

     governmental agency or body, domestic or foreign, now pending, or, to the

     knowledge of the Company, threatened, against the Company or any of its

     subsidiaries which is required to be disclosed in the Registration

     Statement or which might in the opinion of the Company result in any

     material adverse change in the condition, financial or otherwise, or in the

     earnings, business affairs or business prospects of the Company and its

     subsidiaries considered as one enterprise, or which might materially and

     adversely affect the properties or assets thereof or which might materially

     and adversely affect the consummation of this Agreement or any Terms

     Agreement; all pending legal or governmental proceedings to which the

     Company or any of its subsidiaries is a party or of which any of their

     respective property or assets is the subject which are not described in the

      Registration Statement, including ordinary routine litigation incidental to

     its business, are, considered in the aggregate, not material; and there are

     no contracts or documents of the Company or any of its subsidiaries which

     are required to be filed as exhibits to the Registration Statement by the

     1933 Act or by the 1933 Act Regulations which have not been so filed.

 

     (xii) Licenses. The Company owns or possesses or has obtained all material

     governmental licenses, permits, consents, orders, approvals and other

     authorizations necessary to lease or own, as the case may be, and to

     operate its properties and to carry on its business as presently conducted

     where its ownership or lease of substantial properties or the conduct of

     its business requires such ownership or possession or the obtaining of such

     governmental licenses, permits, consents, orders, approvals and other

     authorizations and where the failure to do so would materially adversely

     affect the business or financial condition of the Company and its

     subsidiaries considered as one enterprise.

 

     (xiii) Investment Company Act. The Company is not, and upon issuance and

     sale of the Notes as herein contemplated and the application of the net

     proceeds therefrom as described in the Prospectus will not be, an

     "investment company" or an entity "controlled" by an "investment company"

     as such terms are defined in the Investment Company Act of 1940, as amended

     (the "1940 Act").

 

     (xiv) Commodity Exchange Act. The Notes, upon issuance, will be excluded or

     exempted under, or beyond the purview of, the Commodity Exchange Act, as

     amended (the "Commodity Exchange Act"), and the rules and regulations of

     the Commodity Futures Trading Commission under the Commodity Exchange Act

     (the "Commodity Exchange Act Regulation").

 

 

 

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     (xv) Rating of the Notes. The Company's long term debt rating is "Aaa" by

     Moody's Investors Service, Inc. and "AAA" by Standard & Poor's Ratings

     Services.

 

     (b) Additional Certifications. Any certificate signed by any director or

officer of the Company and delivered to the Agents or to counsel to the Agents

in connection with an offering of Notes or the sale of Notes to one or more of

the Agents as principal shall be deemed a representation and warranty by the

Company to the Agents as to the matters covered thereby on the date of such

certificate and at each Representation Date subsequent thereto.

 

SECTION 3. Solicitations as Agents; Purchases as Principals.

 

     (a) Solicitations as Agents. On the basis of the representations and

warranties herein contained, but subject to the terms and conditions herein set

forth, when agreed by the Company and an Agent, such Agent, as an agent of the

Company, will use its reasonable efforts to solicit offers for the purchase of

Notes upon the terms and conditions set forth in the Prospectus. The Agents are

not authorized to appoint sub-agents with respect to Notes sold through them as

agent.

 

     The Company reserves the right, in its sole discretion, to suspend

solicitation of purchases of the Notes through the Agents, as agents, commencing

at any time for any period of time or permanently. Upon receipt of instructions

from the Company, the Agents will forthwith suspend solicitation of purchases

from the Company until such time as the Company has advised the Agents that such

solicitation may be resumed.

 

     The Company agrees to pay each Agent a commission, in the form of a

discount or otherwise as agreed to by the Company and the Agents, equal to the

applicable percentage of the principal amount of each Note sold by the Company

as a result of a solicitation made by such Agent as set forth in Schedule A

hereto; provided, however, that the Company shall only be obligated to pay one

such fee with respect to any particular Note so sold.

 

     The purchase price, interest rate, maturity date and other terms of the

Notes shall be agreed upon by the Company and the Agents and set forth in a

pricing supplement to the Prospectus to be prepared following each acceptance by

the Company of an offer for the purchase of Notes. Except as may be otherwise

provided in such supplement to the Prospectus, the Notes will be issued in

denominations of $1,000 and integral multiples thereof. All Notes sold through

the Agents as agents will be sold at 100% of their principal amount unless

otherwise agreed to by the Company and the Agents.

 

     (b) Purchases as Principal. Notes purchased from the Company by an Agent or

Dealers individually or as part of a syndicate with one or more other Agents

and/or Dealers, as principal shall be made in accordance with the terms

contained herein and, if requested by such Agent or Dealer, pursuant to a

separate agreement which will provide for the sale of such Notes to, and the

purchase and reoffering thereof, by such Agent or Dealer. Each such separate

agreement (which may be an oral agreement) between one or more Agents and/or

Dealers and the Company is herein referred to as a "Terms Agreement." Unless the

context otherwise requires, each reference contained herein to "this Agreement"

shall be deemed to include any Terms Agreement between the Company and one or

more Agents and/or Dealers. Each such

 

 

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Terms Agreement, whether oral or in writing, shall be with respect to such

information (as applicable) as is specified in Exhibit A hereto. An Agent's

and/or Dealer's commitment to purchase Notes as principal shall be deemed to

have been made on the basis of the representations and warranties of the Company

herein contained and shall be subject to the terms and conditions herein set

forth and, as applicable, as set forth in any Terms Agreement. Each Terms

Agreement shall specify the principal amount of Notes to be purchased by each

Agent and/or Dealer pursuant thereto, the price to be paid to the Company for

such Notes (which, if not so specified in a Terms Agreement, shall be at a

discount equivalent to the applicable commission set forth in Schedule A

hereto), the time and place of delivery of and payment for such Notes, if the

trade is being made with two or more Agents and/or Dealers, the applicable

default provisions in the event of a default by one or more of the Agents and/or

Dealers, and such other provisions (including further terms of the Notes) as may

be mutually agreed upon. The Agents and/or Dealers may engage the services of

any broker or dealer in connection with the resale of the Notes purchased by

them as principal and may allow all or any portion of the discount received from

the Company in connection with such purchases to such brokers or dealers. Such

Terms Agreement shall also specify whether or not any of the officer's

certificate, opinions of counsel or comfort letter specified in Sections 7(b),

7(c) and 7(d) hereof shall be required to be delivered by the Company on the

related Settlement Date.

 

     If the Company and two or more Agents and/or Dealers enter into an

agreement pursuant to which such Agents and/or Dealers agree to purchase Notes

as part of a syndicate and one or more of such Agents and/or Dealers shall fail

at the Settlement Date to purchase the Notes which it or they are obligated to

purchase (the "Defaulted Notes"), then the nondefaulting Agents and/or Dealers

shall have the right, within 24 hours thereafter, to make arrangements for one

of them or one or more other Agents or underwriters to purchase all, but not

less than all, of the Defaulted Notes in such amounts as may be agreed upon and

upon the terms herein set forth; provided, however, that if such arrangements

shall not have been completed within such 24-hour period, then:

 

     (i) if the aggregate principal amount of Defaulted Notes does not exceed

     10% of the aggregate principal amount of Notes to be so purchased by all of

     such Agents and/or Dealers on the Settlement Date, the nondefaulting Agents

     and/or Dealers shall be obligated, severally and not jointly, to purchase

     the full amount thereof in the proportions that their respective initial

     underwriting obligations bear to the underwriting obligations of all

     nondefaulting Agents and/or Dealers; or

 

     (ii) if the aggregate principal amount of Defaulted Notes exceeds 10% of

     the aggregate principal amount of Notes to be so purchased by all of such

     Agents and/or Dealers on the Settlement Date, such agreement to purchase

     such Notes shall terminate without liability on the part of any

     nondefaulting Agents and/or Dealers.

 

No action taken pursuant to this paragraph shall relieve any defaulting Agent

and/or Dealer from liability in respect of its default. In the event of any such

default which does not result in a termination of such agreement, either the

nondefaulting Agents and/or Dealers or the Company shall have the right to

postpone the Settlement Date for a period not exceeding seven days in

 

 

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order to effect any required changes in the Registration Statement or the

Prospectus or in any other documents or arrangements.

 

     (c) Administrative Procedures. Administrative procedures with respect to

the sale of Notes shall be agreed upon from time to time by the Agents and the

Company (the "Procedures"). Each Agent and the Company agree to perform the

respective duties and obligations specifically provided to be performed by them

in the Procedures.

 

     (d) Delivery of Closing Documents. The documents required to be delivered

by Section 5 hereof shall be delivered at the office of O'Melveny & Myers LLP,

400 South Hope Street, Los Angeles, California 90071 on the date hereof, or at

such other time or place as the Agents and the Company may agree.

 

SECTION 4. Covenants of the Company.

 

     The Company covenants with the Agents as follows:

 

     (a) Notice of Certain Events. The Company will promptly notify (i) the

Agents of the effectiveness of any amendment to the Registration Statement, (ii)

the related Agent or Agents of the transmittal to the Commission for filing of

any supplement to the Prospectus (other than an amendment or supplement which

relates exclusively to an offering of debt securities under the Registration

Statement other than the Notes) or any document to be filed pursuant to the 1934

Act which will be incorporated by reference in the Prospectus (other than any

Current Report on Form 8-K relating exclusively to an offering of debt

securities under the Registration Statement other than the Notes), (iii) the

Agents of the receipt of any comments from the Commission with respect to the

Registration Statement or the Prospectus, (iv) the Agents of any request by the

Commission for any amendment to the Registration Statement or any amendment or

supplement to the Prospectus (other than an amendment or supplement which

relates exclusively to an offering of debt securities under the Registration

Statement other than the Notes) or for additional information, (v) the Agents of

the issuance by the Commission of any stop order suspending the effectiveness of

the Registration Statement or the initiation of any proceedings for that

purpose; and (vi) any change in the rating assigned by any nationally recognized

statistical rating organization to any debt securities (including the Notes) of

the Company, or the public announcement by any nationally recognized statistical

rating organization that it has under surveillance or review, with possible

negative implications, its rating of any such debt securities, or the withdrawal

by any nationally recognized statistical rating organization of its rating of

any such debt securities since the date of this Agreement. The Company will make

every reasonable effort to prevent the issuance of any stop order and, if any

stop order is issued, to obtain the lifting thereof at the earliest possible

moment.

 

     (b) Notice of Certain Proposed Filings. Except as otherwise provided in

subsection (l) of this Section 4, the Company will give the Agents notice of its

intention to file or prepare any additional registration statement with respect

to the registration of additional Notes, any amendment to the Registration

Statement or any amendment or supplement to the Prospectus (other than an

amendment or supplement providing solely for the establishment of or change in,

the interest rates, maturity, price or other terms of Notes or other similar

changes or an amendment or supplement which relates exclusively to an offering

of debt securities under the Registration Statement other than the Notes)

whether by the filing of documents pursuant to the

 

 

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1934 Act (other than any Current Report on Form 8-K relating exclusively to the

issuance of debt securities under the Registration Statement other than the

Notes), the 1933 Act or otherwise, and will furnish the Agents with copies of

any such amendment or supplement or other documents proposed to be filed or

prepared a reasonable time in advance of such proposed filing or preparation, as

the case may be, and will not file any such amendment or supplement in a form to

which you or your counsel shall reasonably object.

 

     (c) Copies of the Registration Statement and the Prospectus. The Company

will deliver to the Agents as many signed and conformed copies of the

Registration Statement (as originally filed) and of each amendment thereto

(including exhibits filed therewith or incorporated by reference therein and

documents incorporated by reference in the Prospectus) as the Agents may

reasonably request. The Company will furnish to the Agents as many copies of the

Prospectus (as amended or supplemented) (other than an amendment or supplement

which relates exclusively to an offering of debt securities under the

Registration Statement other than the Notes) as the related Agents shall

reasonably request so long as the Agent is required to deliver a Prospectus in

connection with sales or solicitations of offers to purchase the Notes. The

Registration Statement and the Prospectus and any amendments or supplements

thereto furnished to the Agents will be