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TVA
enters into a deferral agreement with each Participant (a “Deferral
Agreement”) under which deferred compensation credits (“Credits”) are made
to an account in the Participant’s name (each, an
“Account”). Credits are made on an annual or other periodic
basis for an established period of time, as specified in the Deferral
Agreement, after which the Participant vests in the full amount in the
Participant’s Account, including interest or return as provided
below.
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The
Participant must be employed with TVA at the time of the expiration of the
Deferral Agreement, or no payment under this Plan will be made by TVA to
the Participant pursuant to the Deferral Agreement, and all Credits, and
any interest or return on such Credits, in the Participant’s Account will
be forfeited. This will not apply in the event TVA terminates
the Participant’s employment without cause through no act or delinquency
of the Participant or in the event of the Participant’s death in service,
in which cases the Participant will become vested in the Account balance
at the time of termination or death. In the event of death in
service, the Participant’s Account balance shall be paid in a lump sum to
the Participant’s designated beneficiary, or in the absence of any such
designation, to the Participant’s estate, by the last day of the first
full calendar month following the receipt of proper proof of the
Participant’s death.
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Each
Participant’s Account will receive interest on the same basis as interest
is calculated under the TVA Deferred Compensation Plan. In lieu
of interest, each Participant may elect to have all or a portion of the
Participant’s Account adjusted by the return tied to one or more mutual
funds selected by the Participant under the same conditions as are
contained in the TVA Deferred Compensation
Plan.
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The
entire vested amount in the Participant’s Account will be paid to the
Participant in a lump sum within sixty (60) days following the expiration
of the Deferral Agreement, unless the Participant elects, within thirty
(30) days following the date the Deferral Agreement is entered into, to
further defer receipt of vested amounts by having the vested Account
balance upon expiration of the Deferral Agreement credited to an account
in the Participant’s name in the TVA Deferred Compensation
Plan. Deferred amounts will be paid out upon the Participant’s
Separation from Service in either a lump sum or in 5 or 10 annual
installments, as chosen by the Participant at the time of
election.
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Under
certain Deferral Agreements with Participants in key positions within TVA,
TVA will vest the Participant in certain Credits at the time the Credit is
made to the Participant’s Account. In the event a Credit vests
upfront on the effective date of the Deferral Agreement or within twelve
(12) months following the effective date of the Deferral Agreement, TVA
will specify within the terms of the Deferral Agreement how the Credit(s)
will be paid to the Participant (lump sum within sixty (60) days following
the expiration of the Deferral Agreement or upon Separation from Service
in either a lump sum or in 5 or 10 annual installments), and the
Participant shall not have a deferral election with respect to such
Credits.
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Approvals
regarding the terms of Deferral Agreements under the Plan for each
Participant, such as the duration of the Deferral Agreements and the
amount and number of Credits, will be made in accordance with the TVA
Compensation Plan and the delegations
thereunder.
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The
Vice President, Human Resources, shall have sole and exclusive
responsibility for resolving any dispute regarding this Plan or a Deferral
Agreement. The decisions of the Vice President, Human
Resources, in all matters pertaining to the Plan’s operation shall be
final and conclusive as to all
parties.
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TVA
shall maintain each Participant’s Account and credit to each Account the
Credits, interest, return, and other such amounts as may be approved or
elected pursuant to this Plan. TVA shall make payments to
Participants (and their beneficiaries, as applicable) pursuant to this
Plan, applicable Deferral Agreements, and the TVA Deferred Compensation
Plan.
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Nothing
contained in this Plan or any Deferral Agreement shall be construed as
conferring upon any Participant the right to continue in the employment of
TVA as an executive or employee or in any other
capacity.
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Nothing
contained in this Plan or any Deferral Agreement and no action taken
pursuant to the provisions of this Plan or any Deferral Agreement shall
create or be construed to create a trust of any kind, or a fiduciary
relationship between TVA and any Participant, designated beneficiary or
any other person.
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No
transfer, assignment, pledge, seizure, or other voluntary or involuntary
alienation or encumbrance of any benefit provided under this Plan or any
Deferral Agreement will be permitted or recognized other than as
specifically provided in this Plan.
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The
above paragraph notwithstanding, TVA may offset amounts owed to it by a
Participant against any amounts payable to a Participant under this Plan
or any Deferral Agreement.
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