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Exhibit 10.5
January 2009
TVA LONG-TERM
DEFERRED COMPENSATION
PLAN
Purpose:
The TVA Long
Term Deferred Compensation Plan (“Plan”) is designed to
provide long-term incentives to executives to encourage them to
stay with TVA and to provide competitive levels of total
compensation to such executives. This Plan will also
assist in the recruitment of top executive talent for TVA by
providing an opportunity for significant additional tax deferred
compensation. As in other corporations, deferred
compensation can be an integral part of a total compensation
package.
Eligibility:
The Board of
Directors, the Chief Executive Officer (“CEO”), or
their delegatees, approve the participants in the Plan in
accordance with then existing delegations of authority
(“Participants”).
Procedures:
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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 i
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