EXHIBIT 10.38

DEFERRAL AGREEMENT
William D. Johnson

The TVA Board of Directors has approved your participation in TVA’s Long-Term
Deferred Compensation Plan (Plan) under the following terms:

 
 
 
Vesting Date(s)
Vesting Amount
Duration of deferral agreement:
Two years nine months
 
 
 
First compensation credit:
$300,000 (01/01/2013)
 
09/30/2013
Balance of account on vesting date
Second compensation credit:
$300,000 (10/01/2013)
 
09/30/2014
Balance of account on vesting date
Third and final compensation credit:
$300,000 (10/01/2014)
 
09/30/2015
Balance of account on vesting date
Total credits over deferral period:
$900,000
 
 
 
Expiration date:
09/30/2015
 
 
 
 
 
 
 
 

Please read the following provisions carefully and indicate your approval by
signing at the designated place below.
________________________________________________________________________________

As a participant in the Plan, I hereby agree to be bound by the following terms
and conditions:

Deferred compensation credits as stated above will be made to an account in my
name to cover a service period, beginning January 1, 2013, and ending on
September 30, 2015, provided that I remain employed by TVA through
September 30, 2015. I shall be entitled to compensation credits including
interest and returns on the vesting dates as stated in the above schedule
provided that I remain employed by TVA through each of the vesting periods. At
the end of each vesting period, the balance in my account, including interest or
return as provided below, will be paid to me in a lump sum payment.

I understand that I must be an employee of TVA at the end of each vesting period
stated above, or no payments or transfers under the Plan will be made by TVA,
and any unvested credits to my account will be extinguished. However, in the
event that TVA terminates my employment during the term of this agreement
through no act or delinquency of my own, this agreement is terminated as of the
date of my termination and no further credits will be made under it and any
credits in my account from this agreement, including interest or return as
provided below, at the time of termination will become vested. If TVA terminates
my employment for cause prior to the expiration of this agreement, no further
payments or credits will be made and my account balance will be extinguished. In
the event of my death during the term of this agreement, my account balance will
be paid to the person identified on my beneficiary designation form or, in the
absence of such designation, to my estate, in a manner permitted by applicable
IRS rules.

Interest will be credited to the balance reflected in my LTDCP account on the
same basis as interest is calculated and credited under the TVA Deferred
Compensation Plan. In the alternative, I may choose to have the balance of my
LTDCP account adjusted based on the return of the funds I select under the same
conditions as are contained in TVA’s Deferred Compensation Plan. I understand
that I am solely responsible for the risk associated with any return elections
that I make.

The Plan may be amended or discontinued by the Board. If the Board elects to
discontinue the Plan, any credits to my account as of the date of termination of
the Plan will be paid to me in accordance with applicable IRS rules.

I understand that nothing contained in this agreement shall be construed as
conferring the right to continue in the employment of TVA as an executive or in
any other capacity and that the method of payment stated above is final (not
revocable).

/s/ William D. Johnson         1/2/13
William D. Johnson                    Date