Document:

EX-10.1

 Exhibit 10.1 

SANDERSON FARMS, INC. 

BONUS AWARD PROGRAM 

(EXECUTIVE COMMITTEE) 

Effective November 1, 2017 

Supersedes November 1, 2016 

 SANDERSON FARMS, INC. 

Bonus Award Program 
 Effective
November 1, 2017 
 I. PURPOSE 

The Board of Directors of Sanderson Farms, Inc. has determined that in addition to the Company’s existing competitive and equitable total
compensation package, it is desirable to maintain a bonus award program for its salaried employees. The purposes for such a program include: 
  

	 	A.	To encourage excellence and high levels of performance. 

  

	 	B.	To recognize the contributions of the salaried employees to the overall profitability of the Company. 

  

	 	C.	To encourage all employees from every division in the Company to cooperate, share information and work together as a team for the overall benefit of the Company and its shareholders. 

II. PARTICIPATION AND MAXIMUM AWARD 

The Executive Committee of Sanderson Farms, Inc. will select and recognize personnel eligible to participate in the bonus award program, and
reserves the right to review and change the class of eligible employees at any time. Those now designated include: 
  

	 	A.	Salaried personnel within the corporate structure of Sanderson Farms, Inc., Sanderson Farms, Inc. (Production Division), Sanderson Farms, Inc. (Processing Division) and Sanderson Farms, Inc. (Foods Division).

  

	 	B.	All salaried management trainees within the corporate structure. 

 The maximum bonus award
achievable will vary depending on the employee’s position in the Company. 

  
 2 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 III. ELIGIBILITY 

EMPLOYMENT/PARTICIPATION LEVEL 

Except in the case of death, disability or retirement, as set forth below, employees must be employed in a designated position on
October 31 of the applicable fiscal year and must have been continuously employed in a designated position for a period of nine months prior to the end of the fiscal year (January 31 – October 31) to be eligible to participate in the
earnings per share bonus award program and with regard to positions that are eligible for bonuses based on performance measures other than earnings per share, must have been continuously employed in a designated position for a period of six months
(April 30 – October 31) to be eligible to participate in that portion of the program. A terminated employee who is rehired in accordance with Company Policy #4.340, “Reinstatement of Benefits,” within the above period will not be
eligible to participate in the bonus award program. Base salary for this purpose shall include regular compensation only, and shall not include bonus award payments and any other miscellaneous payments that might be treated as income to the
employee. 
 DEATH, DISABILITY AND RETIREMENT 

If an eligible employee terminates employment with the Company during the fiscal year before October 31 as a result of death, disability
or retirement, and had been employed in a designated position for a period of at least nine months, such employee will be eligible to participate in the Bonus Award Program notwithstanding the fact that the employee is not employed on
October 31, and the base salary paid to such employee during that portion of the year during which he or she was employed in a designated position will be used to calculate the amount of such employee’s bonus award. 

MILITARY SERVICE 
 If an employee
is on qualified military leave of absence during part or all of the fiscal year, such employee will be eligible to participate in the Bonus Award Program if such employee would have been otherwise eligible to participate. Such employee’s
“Base Salary” for purposes of determining any bonus award will be his or her base salary that would have been paid had him or her not been on military leave. 

EXTRAORDINARY CIRCUMSTANCES 

Extraordinary circumstances will be subject to review by the Executive Committee. 

  
 3 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 IV. DETERMINATION OF AWARD AND PAYMENT 

Bonus award programs for many corporations focus in some form or another on the real dollar profits earned by the corporation within a given
time frame. This method of determining bonuses to be paid to employees recognizes that bonuses should be paid to employees only after a fair and equitable return has been earned for the shareholders who own the company. With this basic philosophy in
mind, the Board has determined that no bonuses will be paid under this program unless net return on average stockholders’ equity after consideration is taken for any bonus paid under this program for the year exceeds eight percent (8%). After
this minimum threshold is met, the Bonus Award Program will become effective, and bonuses will be paid if the other criteria described in this program are met. 

In recognition of the fact that one of our primary obligations as employees of this Company is to our shareholders, the Board of Directors has
determined that net profits made by the consolidated corporations [Sanderson Farms, Inc., Sanderson Farms, Inc. (Production Division), Sanderson Farms, Inc. (Processing Division) and Sanderson Farms, Inc. (Foods Division)] on a per share basis for
the period November 1 through October 31 of each year will be the primary basis for bonus awards. The earnings per share for purposes of computing the bonus awards, as set forth herein, shall be computed net of any bonuses awarded and net
of any extraordinary, non recurring income items. For all salaried employees of Sanderson Farms other than those management level employees specifically described in this program, this will be the sole basis for determining bonus awards. 

Although the Board has determined that net profits earned for shareholders of the Company should be the primary method of determining the
bonuses to be paid to employees, the Board has also recognized that certain management level employees have responsibility for and more direct control over the operating performance and profitability of the Company. In recognition of this fact, the
Board has concluded that a certain percentage of such employees’ bonus should be determined by evaluating the operating and profitability performance of the Company relative to its peers and competitors. Therefore, while a portion of such
employees’ bonus will be determined by the Company’s earnings per share performance, a portion of such employees’ bonus will also be determined by evaluating the performance of the Company as compared to our peers and competitors by
Agri Stats for the poultry division, and certain net income growth targets for managers in the foods division, all as described herein. 

The audited annual financial statements, on a consolidated basis, of Sanderson Farms, Inc. will be the measuring tool for the net return to
shareholders portion of the bonus award program. The annual bonus award will be paid to participants in the bonus award program after the outside auditors have completed their annual audit of the corporations, which is usually approximately two
(2) months after the end of the fiscal year. 
 The performance of the Company’s birds relative to its peers’ and
competitors’ birds as measured by bottom line profit per head as reported by AgriStats will be used to evaluate and determine bonuses paid to those employees whose bonuses are determined in part by such performance. The appropriate measuring
tool as set forth in this Bonus Award Program as reported by Agri Stats for the twelve (12) month period ending on October 31 each year will be used to determine if a bonus has been earned by such employees. 

  
 4 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 V. OBJECTIVES AND FORMULAS FOR DETERMINATION OF THE BONUS AWARD 

 

	 	A.	All salaried employees 

 All salaried employees will receive a bonus if the net income per
share objectives set forth below are met, and if the minimum return on average stockholders equity for the year is earned. Net income shall be computed net of any bonuses awarded and net of any extraordinary, non recurring income items not related
to the fiscal year’s operations. The annual audited financial statements, on a consolidated basis, of Sanderson Farms, Inc., will be the measuring tool for this portion of the Bonus Award Program. The annual bonus award will be paid to
participants after the outside auditors have completed their annual audit of the consolidated corporation. 
 The earnings per share
objectives and the respective percentage of employees’ bonus dependent upon EPS earned for the fiscal year (November 1 thru October 31) are as follows: 
  

					
	 RANK
	  	PER SHARE RETURN*	  	PERCENTAGE OF AWARD
			
	Best (1st)	  	$16.13	  	100.0%
	2nd	  	$15.95	  	  95.0%
	3rd	  	$15.78	  	  90.0%
	4th	  	$15.60	  	  85.0%
	5th	  	$15.43	  	  80.0%
	6th	  	$15.26	  	  75.0%
	7th	  	$15.08	  	  70.0%
	8th	  	$14.91	  	  65.0%
	9th	  	$14.73	  	  60.0%
	10th	  	$14.56	  	  55.0%
	11th	  	$14.41	  	  50.0%
	12th	  	$14.25	  	  45.0%
	13th	  	$14.10	  	  40.0%
	14th	  	$13.95	  	  35.0%
	15th	  	$13.80	  	  30.0%
	16th	  	$13.64	  	  25.0%
	17th	  	$13.49	  	  20.0%
	18th	  	$13.34	  	  15.0%
	19th	  	$13.18	  	  10.0%
	20th	  	$13.03	  	    5.0%

  

	*	Net of bonus and net of extraordinary, non recurring income items not related to the fiscal year’s operations. The per share return targets were calculated using the diluted shares as of the end of the most recent
fiscal year. Adjustments to these targets will be made to reflect changes in the number of shares outstanding resulting from any merger, consolidation, reorganization, re-capitalization, re-incorporation, stock-splits, stock dividend, stock repurchase, stock issuance or other changes in the corporate structure of the Company. Furthermore, the target per share return numbers were calculated based on
a target net return on projected sales. The Company reserves the right to adjust these targets in the event of a substantial fluctuation in sales pounds or dollars during the year caused by unforeseen events or circumstances. 

  
 5 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 The following formula will be utilized to determine the exact dollar amount of a
participant’s bonus award dependent upon EPS performance. 
  

					
	A	  	=	  	Gross Award
	S	  	=	  	Base Salary (excluding bonus award payments and other items of miscellaneous income) of the Participant during that portion of the year in which he or she was employed in a designated position.
	P	  	=	  	Percentage of award earned based on above schedule
	M	  	=	  	Percent of salary eligible to be earned as a bonus based on EPS performance.
		
		  	FORMULA
			
		  		  	S X P X M = A

  
 6 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 As with any awards made under this Bonus Award Program, no bonus will be paid unless total
net income return (after bonus) on average stockholders’ equity for the year exceeds eight percent (8%). Net return on average stockholders’ equity will be computed by taking the average of beginning and ending stockholders’ equity
for the applicable year, and dividing that number into net income for the year. 
 For all members of the Executive Committee other than
those specifically set forth below, the percent of salary eligible to be earned as a bonus based on EPS performance (“M” in the above formula) is 32.5%. The Executive Committee employees set forth below shall be eligible to earn a bonus
based on EPS performance equal to the percent of their salary as set forth below (“M” in the above formula): 
  

					
	 CEO
	  	 	100	% 
	 COO/President
	  	 	80	% 
	 CFO
	  	 	70	% 
	 Dir. Sales
	  	 	45	% 
	 Dir. Production
	  	 	45	% 
	 Dir. Processing
	  	 	45	% 
	 CAO/Secretary
	  	 	40	% 

  

	 	B.	Executive Committee 

 Bonus awards under this Bonus Award Program for members of the Executive
Committee will be granted based on a combination of earnings per share performance and performance of the Company’s birds as measured against the Company’s peers’ and competitors’ birds as reported by Agri Stats. For purposes of
calculating bonuses awarded and paid to individuals in these positions based on operating performance, the corporate Agri Stats measure will be “bottom line analysis, per head” as compared to the same measure for all other head reported
for the industry during the fiscal year, net of bonus. Awards made to these individuals based on the operating performance factor will be as follows: 

  
 7 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

											
	 	  	Percentage of Salary
Eligible to be Earned as
Bonus on Operating
Performance Factors	 	Corporate Agri Stats
Bottom Line (per head)*
(Percentage of Award Earned)
	 TARGET
	  	 				 	 	 	TOP 10	%
	 CEO
	  	 	 	100	%	 	 	 	100	%
	 COO
	  	 	 	80	%	 	 	 	100	%
	 CFO
	  	 	 	70	%	 	 	 	100	%
	 Dir. Sales, Dir. Proc., Dir. Prod.
	  	 	 	45	%	 	 	 	100	%
	 CAO/Secretary
	  	 	 	40	%	 	 	 	100	%
	 All Other EC Members
	  	 	 	32.5	%	 	 	 	100	%
			
	 HIGH AVERAGE
	  	 				 	 	 	TOP 20	%
	 CEO
	  	 	 	100	%	 	 	 	66 2⁄3	%
	 COO
	  	 	 	80	%	 	 	 	66 2⁄3	%
	 CFO
	  	 	 	70	%	 	 	 	66 2⁄3	%
	 Dir. Sales, Dir. Proc., Dir. Prod.
	  	 	 	45	%	 	 	 	66 2⁄3	%
	 CAO/Secretary
	  	 	 	40	%	 	 	 	66 2⁄3	%
	 All Other EC Members
	  	 	 	32.5	%	 	 	 	66 2⁄3	%
			
	 LOW AVERAGE
	  	 				 	 	 	Top 30	%
	 CEO
	  	 	 	100	%	 	 	 	33 1⁄3	%
	 COO
	  	 	 	80	%	 	 	 	33 1⁄3	%
	 CFO
	  	 	 	70	%	 	 	 	33 1⁄3	%
	 Dir. Sales., Dir. Prod., Dir. Proc.
	  	 	 	45	%	 	 	 	33 1⁄3	%
	 CAO/Secretary
	  	 	 	40	%	 	 	 	33 1⁄3	%
	 All Other EC Members
	  	 	 	32.5	%	 	 	 	33 1⁄3	%

  

	*	Placement of the Company’s bottom line profit per head in the top 10%, 20% or 30% will be measured by comparing the bottom line profit per head earned by the Company to all head reported by Agri Stats for the
fiscal year. If the bottom line profit per head earned by the Company’s head is in the top 10% of all head processed by the industry during the year, the Target bonus will be earned. The same measure will be used for the other two places (High
Average requiring a top 20% finish and Low Average requiring a top 30% finish). 

 The following formula will be utilized for
all employees whose bonus is to be determined in part by factors other than EPS performance to determine that portion of the award dependent upon such factors: 
  

					
	A	  	=	  	Gross Award
	S	  	=	  	Base Salary (excluding bonus award payments and other items of miscellaneous income) of the Participant during that portion of the year in which he or she was employed in a designated position.
	P	  	=	  	Percentage of award earned based on performance factor
	M	  	=	  	Percentage of salary eligible to be earned and paid as a bonus on performance factor.
		
		  	FORMULA
			
		  		  	S X P X M = A

  
 8 

 SANDERSON FARMS, INC. 

Bonus Award Program 
  

 VI. PARAMETERS 

This bonus award program has been designed to encourage teamwork and cooperation among all of the divisions of Sanderson Farms, and to ensure
that Sanderson Farms is consistently among the leaders in profitability in the broiler and prepared foods industry. The program is also designed to pay a bonus to employees only after the Company has returned to its shareholders a fair and equitable
return. 
 1.    In the event of extraordinary operating conditions that were unforeseen when setting the objectives and
percentages in this bonus award program, such circumstances will be considered by the Compensation Committee of the Board of Directors and the Executive Committee of Sanderson Farms, Inc. in making awards. 

2.    In the event of possible reporting errors affecting the ranking, such circumstances will be considered by the
Compensation Committee of the Board of Directors and the Executive Committee of Sanderson Farms, Inc. in making awards. 

3.    In the event changes in laws or accounting procedures affect the ranking, such circumstances will be considered by
the Compensation Committee of the Board of Directors and the Executive Committee of Sanderson Farms, Inc. in making awards. 

4.    The per share return targets were calculated using diluted shares at the end of the most recent fiscal year.
Adjustments to these targets will be made to reflect changes in the number of shares outstanding resulting from any merger, consolidation, reorganization, re-capitalization,
re-incorporation, stock-splits, stock dividend, stock repurchase, stock issuance or other changes in the corporate structure of the Company. Furthermore, the target per share return numbers were calculated
with reference to a target net return on projected sales and return on average equity. The Compensation Committee of the Board of Directors and the Executive Committee of Sanderson Farms, Inc. reserves the right to adjust these targets in the event
of a substantial fluctuation in sales pounds or dollars during the year caused by unforeseen events or circumstances. 

  
 9Exhibit 4.1

 

BA CREDIT CARD TRUST

as Issuer

CLASS A(2018‐1) TERMS DOCUMENT

dated as of February 23, 2018

to

THIRD AMENDED AND RESTATED BASERIES INDENTURE SUPPLEMENT

dated as of December 17, 2015

to

FOURTH AMENDED AND RESTATED INDENTURE

dated as of December 17, 2015

THE BANK OF NEW YORK MELLON

as Indenture Trustee

 

TABLE OF CONTENTS

 

	 	 	 	 	
Page

	 	 	 	 	 
	
ARTICLE I

	
Definitions And Other Provisions Of General Application

	
1

	 	 	 
	 	
Section 1.01.

	 	
Definitions

	
1

	 	
Section 1.02.

	 	
Governing Law; Submission to Jurisdiction; Agent for Service of Process

	
5

	 	
Section 1.03.

	 	
Counterparts

	
6

	 	
Section 1.04.

	 	
Ratification of Indenture and Indenture Supplement

	
6

	 	 	 
	
ARTICLE II

	
The Class A(2018‐1) Notes

	
7

	 	 	 
	 	
Section 2.01.

	 	
Creation and Designation

	
7

	 	
Section 2.02.

	 	
Specification of Required Subordinated Amount and other Terms

	
7

	 	
Section 2.03.

	 	
Interest Payment

	
7

	 	
Section 2.04.

	 	
Payments of Interest and Principal

	
8

	 	
Section 2.05.

	 	
Form of Delivery of Class A(2018‐1) Notes; Depository; Denominations

	
8

	 	
Section 2.06.

	 	
Delivery and Payment for the Class A(2018‐1) Notes

	
8

	 	
Section 2.07.

	 	
Targeted Deposits to the Accumulation Reserve Account

	
8

	 	 	 
	
ARTICLE III

	
Representations and Warranties

	
9

	 	 	 
	
 

	
Section 3.01.

	 	
Issuer’s Representations and Warranties

	
9

 

- i -

THIS CLASS A(2018‐1) TERMS DOCUMENT (this “Terms Document”), by and between BA CREDIT CARD TRUST, a statutory trust created under the laws of the State of Delaware (the “Issuer”), having its principal office at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890, and THE BANK OF NEW YORK MELLON, a New York banking corporation, as Indenture Trustee (the “Indenture Trustee”), is made and entered into as of February 23, 2018.

Pursuant to this Terms Document, the Issuer and the Indenture Trustee shall create a new tranche of Class A Notes and shall specify the principal terms thereof.

ARTICLE I

 

Definitions and Other Provisions of General Application

Section 1.01.          Definitions.  For all purposes of this Terms Document, except as otherwise expressly provided or unless the context otherwise requires:

(1)          the terms defined in this Article have the meanings assigned to them in this Article, and include the plural as well as the singular;

(2)          all other terms used herein which are defined in the Third Amended and Restated BAseries Indenture Supplement, dated as of December 17, 2015 (as modified, amended or supplemented from time to time, the “Indenture Supplement”), between the Issuer and the Indenture Trustee, or the Fourth Amended and Restated Indenture, dated as of December 17, 2015 (as modified, amended or supplemented from time to time, the “Indenture”), between the Issuer and the Indenture Trustee, as acknowledged and accepted by BANA, as Servicer, either directly or by reference therein, have the meanings assigned to them therein;

(3)          all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder means such accounting principles as are generally accepted in the United States of America at the date of such computation;

(4)          all references in this Terms Document to designated “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Terms Document as originally executed;

(5)          the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Terms Document as a whole and not to any particular Article, Section or other subdivision; 

 

(6)          in the event that any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Indenture Supplement or the Indenture, the terms and provisions of this Terms Document shall be controlling;

(7)          each capitalized term defined herein shall relate only to the Class A(2018‐1) Notes and no other tranche of Notes issued by the Issuer; and 

(8)          “including” and words of similar import will be deemed to be followed by “without limitation.”

“Accumulation Reserve Funding Period” shall mean, (a) if the Accumulation Period Length is determined to be one (1) month, there shall be no Accumulation Reserve Funding Period and (b) otherwise, the period (x) commencing on the earliest to occur of (i) the Monthly Period beginning three (3) calendar months prior to the first Transfer Date for which a budgeted deposit is targeted to be made into the Principal Funding sub-Account of the Class A(2018‐1) Notes pursuant to Section 3.10(b) of the Indenture Supplement, (ii) the Monthly Period following the first Transfer Date following and including the January 2019 Transfer Date for which the Quarterly Excess Available Funds Percentage is less than 2%, but in such event the Accumulation Reserve Funding Period shall not be required to commence earlier than 24 months prior to the Expected Principal Payment Date, (iii) the Monthly Period following the first Transfer Date following and including the July 2019 Transfer Date for which the Quarterly Excess Available Funds Percentage is less than 3%, but in such event the Accumulation Reserve Funding Period shall not be required to commence earlier than 18 months prior to the Expected Principal Payment Date, and (iv) the Monthly Period following the first Transfer Date following and including the September 2019 Transfer Date for which the Quarterly Excess Available Funds Percentage is less than 4%, but in such event the Accumulation Reserve Funding Period shall not be required to commence earlier than 16 months prior to the Expected Principal Payment Date and (y) ending on the close of business on the last day of the Monthly Period preceding the earlier to occur of (i) the Expected Principal Payment Date for the Class A(2018‐1) Notes and (ii) the date on which the Class A(2018‐1) Notes are paid in full.

“Base Rate” means, with respect to any Monthly Period, the sum of (i) the Weighted Average Interest Rates for the Outstanding BAseries Notes and the Class D Certificate (as such term is defined in the Series 2001‐D Supplement), (ii) the Net Servicing Fee Rate (as such term is defined in the Series 2001‐D Supplement) and (iii) so long as BANA or The Bank of New York Mellon is the Servicer, the Servicer Interchange Rate, in each case, for such Monthly Period.

“BAseries Servicer Interchange” means, with respect to any Monthly Period, an amount equal to the product of (a) the Servicer Interchange (as such term is defined in the Series 2001‐D Supplement) with respect to such Monthly Period and (b) a fraction the numerator of which is the Weighted Average Available Funds Allocation Amount for the BAseries for such Monthly Period and the denominator of which is the Weighted Average Available Funds Allocation Amount for all series of Notes for such Monthly Period.

 

- 2 -

“Class A(2018‐1) Note” means any Note, substantially in the form set forth in Exhibit A-1 to the Indenture Supplement, designated therein as a Class A(2018‐1) Note and duly executed and authenticated in accordance with the Indenture.

“Class A(2018‐1) Noteholder” means a Person in whose name a Class A(2018‐1) Note is registered in the Note Register.

“Class A(2018‐1) Termination Date” means the earliest to occur of (a) the Principal Payment Date on which the Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes is paid in full, (b) the Legal Maturity Date and (c) the date on which the Indenture is discharged and satisfied pursuant to Article VI thereof.

“Class A Required Subordinated Amount of Class B Notes” is defined in Section 2.02(a). 

“Class A Required Subordinated Amount of Class C Notes” is defined in Section 2.02(b).

“Controlled Accumulation Amount” means $131,250,000; provided, however, if the Accumulation Period Length is determined to be less than twelve (12) months pursuant to Section 3.10(b)(ii) of the Indenture Supplement, the Controlled Accumulation Amount shall be the amount specified in the definition of “Controlled Accumulation Amount” in the Indenture Supplement.

“Excess Available Funds Percentage” means, with respect to any Transfer Date, the amount, if any, by which the Portfolio Yield for the preceding Monthly Period exceeds the Base Rate for such Monthly Period.

“Expected Principal Payment Date” means February 16, 2021.

“Initial Dollar Principal Amount” means $1,575,000,000.

“Interest Payment Date” means the fifteenth day of each month, or if such fifteenth day is not a Business Day, the next succeeding Business Day, commencing April 16, 2018.

“Interest Period” means, with respect to any Interest Payment Date, the period from and including the previous Interest Payment Date (or in the case of the initial Interest Payment Date, from and including the Issuance Date) through the day preceding such Interest Payment Date.

“Issuance Date” means February 23, 2018.

“Legal Maturity Date” means July 17, 2023.

“Note Interest Rate” means a per annum rate equal to 2.70%.

 

- 3 -

“Paying Agent” means The Bank of New York Mellon.

“Portfolio Yield” means, with respect to any Monthly Period, the annualized percentage equivalent of a fraction, the numerator of which is (a) the amount of Available Funds allocated to the BAseries pursuant to Section 501 of the Indenture, plus (b) the amount of Available Funds distributed pursuant to Sections 4.06(a)(ii) and (iii) of the Series 2001‐D Supplement, plus (c) any Interest Funding sub‐Account Earnings on the related Transfer Date, plus (d) any amounts to be treated as BAseries Available Funds pursuant to Sections 3.20(d) and 3.27(a) of the Indenture Supplement, plus (e) the BAseries Servicer Interchange for such Monthly Period, minus (f) the excess, if any, of the sum of the PFA Prefunding Earnings Shortfall plus the PFA Accumulation Earnings Shortfall over the sum of the aggregate amount to be treated as BAseries Available Funds for such Monthly Period pursuant to Sections 3.04(a)(ii) and 3.25(a) of the Indenture Supplement plus any other amounts applied to cover earnings shortfalls on amounts in the Principal Funding sub‐Account for any tranche of BAseries Notes for such Monthly Period, minus (g) the BAseries Investor Default Amount for such Monthly Period, minus (h) the Aggregate Class D Investor Default Amount (as such term is defined in the Series 2001‐D Supplement) for such Monthly Period, and the denominator of which is the Weighted Average Floating Allocation Investor Interest (as such term is defined in the Series 2001‐D Supplement) for such Monthly Period.

“Predecessor Note” means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purpose of this definition, any Note authenticated and delivered under Section 306 of the Indenture in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen Note.

“Quarterly Excess Available Funds Percentage” means, with respect to the January 2019 Transfer Date and each Transfer Date thereafter, the percentage equivalent of a fraction the numerator of which is the sum of the Excess Available Funds Percentages with respect to the immediately preceding three Monthly Periods and the denominator of which is three.

“Record Date” means, for any Transfer Date, the last day of the preceding Monthly Period.

“Required Accumulation Reserve sub-Account Amount” means, with respect to any Monthly Period during the Accumulation Reserve Funding Period, an amount equal to (i) 0.5% of the Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes as of the close of business on the last day of the preceding Monthly Period or (ii) any other amount designated by the Issuer; provided, however, that if such designation is of a lesser amount, the Note Rating Agencies shall have provided prior written confirmation that a Ratings Effect will not occur with respect to such change.

“Servicer Interchange Rate” means, for any Monthly Period, the percentage equivalent of a fraction, the numerator of which is the BAseries Servicer Interchange for such Monthly Period, and the denominator of which is the Weighted Average Floating Allocation Investor Interest (as such term is defined in the Series 2001‐D Supplement) for such Monthly Period.

 

- 4 -

“Stated Principal Amount” means $1,575,000,000.

“Weighted Average Interest Rates” means, with respect to any Outstanding Notes of a class or tranche of the BAseries or the Class D Certificate (as such term is defined in the Series 2001‐D Supplement), or of all of the Outstanding Notes of the BAseries and the Class D Certificate, on any date, the weighted average (weighted based on the Outstanding Dollar Principal Amount of the related Notes on such date or, in the case of the Class D Certificate, based on the Class D Investor Interest (as such term is defined in the Series 2001‐D Supplement) on such date) of the following rates of interest:

(a)          in the case of the Class D Certificate or a tranche of Dollar Interest-bearing Notes with no Derivative Agreement for interest, the rate of interest applicable to that tranche or the Class D Certificate on that date;

(b)          in the case of a tranche of Discount Notes, the rate of accretion (converted to an accrual rate) of that tranche on that date;

(c)          in the case of a tranche of Notes with a payment due under a Performing Derivative Agreement for interest, the rate at which payments by the Issuer to the applicable Derivative Counterparty accrue on that date (prior to the netting of such payments, if applicable); and 

(d)          in the case of a tranche of Notes with a non-Performing Derivative Agreement for interest, the rate specified for that date in the related terms document.

Section 1.02.          Governing Law; Submission to Jurisdiction; Agent for Service of Process.  This Terms Document shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to principles of conflict of laws.  The parties hereto declare that it is their intention that this Terms Document shall be regarded as made under the laws of the State of Delaware and that the laws of said State shall be applied in interpreting its provisions in all cases where legal interpretation shall be required.  Each of the parties hereto agrees (a) that this Terms Document involves at least $100,000.00, and (b) that this Terms Document has been entered into by the parties hereto in express reliance upon 6 DEL. C. § 2708.  Each of the parties hereto hereby irrevocably and unconditionally agrees (a) to be subject to the jurisdiction of the courts of the State of Delaware and of the federal courts sitting in the State of Delaware, and (b)(1) to the extent such party is not otherwise subject to service of process in the State of Delaware, to appoint and maintain an agent in the State of Delaware as such party’s agent for acceptance of legal process, and (2) that, to the fullest extent permitted by applicable law, service of process may also be made on such party by prepaid certified mail with a proof of mailing receipt validated by the United States Postal Service constituting evidence of valid service, and that service made pursuant to (b)(1) or (2) above shall, to the fullest extent permitted by applicable law, have the same legal force and effect as if served upon such party personally within the State of Delaware.

 

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Section 1.03.          Counterparts.  This Terms Document may be executed in any number of counterparts, each of which so executed will be deemed to be an original, but all such counterparts will together constitute but one and the same instrument.

Section 1.04.          Ratification of Indenture and Indenture Supplement.  As supplemented by this Terms Document, each of the Indenture and the Indenture Supplement is in all respects ratified and confirmed and the Indenture as so supplemented by the Indenture Supplement as so supplemented and this Terms Document shall be read, taken and construed as one and the same instrument.

[END OF ARTICLE I]

 

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ARTICLE II

 

The Class A(2018‐1) Notes

Section 2.01.          Creation and Designation.  There is hereby created a tranche of BAseries Class A Notes to be issued pursuant to the Indenture and the Indenture Supplement to be known as the “BAseries Class A(2018‐1) Notes.”

Section 2.02.          Specification of Required Subordinated Amount and other Terms.

(a)          For the Class A(2018‐1) Notes for any date of determination, the Class A Required Subordinated Amount of Class B Notes will be an amount equal to 14.28571% of (i) the Adjusted Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes on such date or (ii) if an Early Redemption Event with respect to the Class A(2018‐1) Notes shall have occurred, if an Event of Default and acceleration of the Class A(2018‐1) Notes shall have occurred or if the Class A Usage of the Class B Required Subordinated Amount for such tranche of Class A Notes is greater than zero, the Adjusted Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes as of close of business on the day immediately preceding the occurrence of such Early Redemption Event, such Event of Default and acceleration or the date on which the Class A Usage of Class B Required Subordinated Amount exceeded zero.

(b)          For the Class A(2018‐1) Notes for any date of determination, the Class A Required Subordinated Amount of Class C Notes will be an amount equal to 12.69841% of (i) the Adjusted Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes on such date or (ii) if an Early Redemption Event with respect to the Class A(2018‐1) Notes shall have occurred, if an Event of Default and acceleration of the Class A(2018‐1) Notes shall have occurred or if the Class A Usage of the Class C Required Subordinated Amount for such tranche of Class A Notes is greater than zero, the Adjusted Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes as of close of business on the day immediately preceding the occurrence of such Early Redemption Event, such Event of Default and acceleration or the date on which the Class A Usage of Class C Required Subordinated Amount exceeded zero.

(c)          The Issuer may change the percentages set forth in clause (a) or (b) above without the consent of any Noteholder so long as the Issuer has (i) received written confirmation from each Note Rating Agency that has rated any Outstanding Notes of the BAseries that the change in either of such percentages will not result in a Ratings Effect with respect to any Outstanding Notes of the BAseries and (ii) delivered to the Indenture Trustee and the Note Rating Agencies a Master Trust Tax Opinion and an Issuer Tax Opinion. 

Section 2.03.          Interest Payment.

(a)          For each Interest Payment Date (other than the first Interest Payment Date), the amount of interest due with respect to the Class A(2018‐1) Notes shall be an amount equal to one-twelfth of the product of (i) the Note Interest Rate times (ii) the Outstanding Dollar Principal Amount of the Class A(2018‐1) Notes determined as of the Record Date preceding the related Transfer Date; provided, however, that for the first Interest Payment Date the amount of interest due is $6,142,500.  Interest on the Class A(2018‐1) Notes will be calculated on the basis of a 360-day year consisting of twelve 30-day months.

 

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(b)          Pursuant to Section 3.03 of the Indenture Supplement, on each Transfer Date, the Indenture Trustee shall deposit into the Class A(2018‐1) Interest Funding sub-Account the portion of BAseries Available Funds allocable to the Class A(2018‐1) Notes. 

          Section 2.04.        Payments of Interest and Principal.  Any installment of interest or principal, if any, payable on any Class A(2018‐1) Note which is punctually paid or duly provided for by the Issuer and the Indenture Trustee on the applicable Interest Payment Date or Principal Payment Date shall be paid by the Paying Agent to the Person in whose name such Class A(2018‐1) Note (or one or more Predecessor Notes) is registered on the Record Date, by wire transfer of immediately available funds to such Person’s account as has been designated by written instructions received by the Paying Agent from such Person not later than the close of business on the third Business Day preceding the date of payment or, if no such account has been so designated, by check mailed first-class, postage prepaid to such Person’s address as it appears on the Note Register on such Record Date, except that with respect to Notes registered on the Record Date in the name of the nominee of Cede & Co., payment shall be made by wire transfer in immediately available funds to the account designated by such nominee.

The right of the Class A(2018‐1) Noteholders to receive payments from the Issuer will terminate on the first Business Day following the Class A(2018‐1) Termination Date.

Section 2.05.          Form of Delivery of Class A(2018‐1) Notes; Depository; Denominations.

(a)          The Class A(2018‐1) Notes shall be delivered in the form of a global Registered Note as provided in Sections 202 and 301(i) of the Indenture, respectively.

(b)          The Depository for the Class A(2018‐1) Notes shall be The Depository Trust Company, and the Class A(2018‐1) Notes shall initially be registered in the name of Cede & Co., its nominee.

(c)          The Class A(2018‐1) Notes will be issued in minimum denominations of $5,000 and multiples of $1,000 in excess of that amount.

Section 2.06.          Delivery and Payment for the Class A(2018‐1) Notes.  The Issuer shall execute and deliver the Class A(2018‐1) Notes to the Indenture Trustee for authentication, and the Indenture Trustee shall deliver the Class A(2018‐1) Notes when authenticated, each in accordance with Section 303 of the Indenture.

Section 2.07.          Targeted Deposits to the Accumulation Reserve Account.  The deposit targeted to be made to the Accumulation Reserve Account for any Monthly Period during the Accumulation Reserve Funding Period will be an amount equal to the Required Accumulation Reserve sub-Account Amount.

[END OF ARTICLE II]

 

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ARTICLE III

 

Representations and Warranties

Section 3.01.          Issuer’s Representations and Warranties.  The Issuer makes the following representations and warranties as to the Collateral Certificate on which the Indenture Trustee is deemed to have relied in acquiring the Collateral Certificate.  Such representations and warranties speak as of the execution and delivery of this Terms Document, but shall survive until the termination of this Terms Document.  Such representations and warranties shall not be waived by any of the parties to this Terms Document unless the Issuer has obtained written confirmation from each Note Rating Agency that there will be no Ratings Effect with respect to such waiver.

(a)          The Indenture creates a valid and continuing security interest (as defined in the Delaware UCC) in the Collateral Certificate in favor of the Indenture Trustee, which security interest is prior to all other liens, and is enforceable as such as against creditors of and purchasers from the Issuer.

(b)          The Collateral Certificate constitutes either an “account,” a “general intangible,” an “instrument,” or a “certificated security,” each within the meaning of the Delaware UCC.

(c)          At the time of the transfer and assignment of the Collateral Certificate to the Indenture Trustee pursuant to the Indenture, the Issuer owned and had good and marketable title to the Collateral Certificate free and clear of any lien, claim or encumbrance of any Person.

(d)          The Issuer has caused, within ten days of the execution of the Indenture, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions under applicable law in order to perfect the security interest in the Collateral Certificate granted to the Indenture Trustee pursuant to the Indenture.

(e)          Other than the security interest granted to the Indenture Trustee pursuant to the Indenture, the Issuer has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed the Collateral Certificate.  The Issuer has not authorized the filing of and is not aware of any financing statements against the Issuer that include a description of collateral covering the Collateral Certificate other than any financing statement relating to the security interest granted to the Indenture Trustee pursuant to the Indenture or any financing statement that has been terminated.  The Issuer is not aware of any judgment or tax lien filings against the Issuer.

(f)          All original executed copies of the Collateral Certificate have been delivered to the Indenture Trustee.

(g)          At the time of the transfer and assignment of the Collateral Certificate to the Indenture Trustee pursuant to the Indenture, the Collateral Certificate had no marks or notations indicating that it has been pledged, assigned or otherwise conveyed to any Person other than the Indenture Trustee.

[END OF ARTICLE III]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Terms Document to be duly executed, all as of the day and year first above written.

 

	 	
BA CREDIT CARD TRUST,

	 	
by BA CREDIT CARD FUNDING, LLC,

	 	
as Beneficiary and not in its individual capacity

	 	 
	 	
By:

	
 

	 	 	
Name:  

	 	 	
Title:  

 

[Signature Page to the Class A(2018‐1) Terms Document]

 

	 	
THE BANK OF NEW YORK MELLON, as Indenture Trustee

	 	
and not in its individual capacity

	 	 
	 	
By:

	
	 	 	
Name:  

	 	 	
Title:  

 

[Signature Page to the Class A(2018‐1) Terms Document]

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