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TENNESSEE VALLEY AUTHORITY
 POWER BONDS
 
 BASIC TENNESSEE VALLEY AUTHORITY POWER
BOND RESOLUTION
 Adopted October 6, 1960




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BASIC TENNESSEE VALLEY AUTHORITY
 POWER BOND RESOLUTION
 Table of Contents
 PageARTICLE I
Definitions and Statutory Authority
    
    
    1Section 1.1 Definitions
    
    
    1Section1.2 Authority for the Resolution
    
    
    3ARTICLE II
General Terms and Provisions
    
    
    3Section2.1 Resolution to Constitute a Contract
    
    
    3Section2.2 Authorization and Issuance of Bonds
    
    
    3Section2.3 Application of Net Power Proceeds
    
    
    3Section2.4 Bond Anticipation Obligations
    
    
    4Section2.5 Other Indebtedness
    
    
    4Section2.6 Amortization
    
    
    4Section2.7 Deposits and Investments
    
    
    5ARTICLE III
Specific Covenants of the Corporation
    
    
    5Section3.1 Payment of Bonds
    
    
    5Section3.2 Rates and Charges
    
    
    5Section3.3 Protection of Bondholders Investment
    
    
    6Section3.4 Limitation on Issuance of Bonds
    
    
    7Section3.5 Depreciation
    
    
    7Section3.6 Operation and Maintenance
    
    
    7Section3.7 Mortgaging and Disposal of Power
Properties
    
    
    7Section3.8 Records and Accounts
    
    
    7Section3.9 Reports
    
    
    8Section3.10 Covenant to Perform
    
    
    8ARTICLE IV
The Trustee, Registrars, and
Paying Agents
    
    
    8Section4.1 Trustee
    
    
    8




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PageSection4.2  Registrars and Paying Agents
    
    
    8Section4.3  Responsibilities of Trustee
    
    
    9Section4.4  Qualifications of Trustee
    
    
    9Section4.5  Resignation or Removal of Trustee
    
    
    9Section4.6  Appointment of Successor Trustee
    
    
    10section4.7  Merger, Conversion, or Consolidation
of Trustee
    
    
    10Section4.8  Succession of Fiduciaries
    
    
    10Section4.9  Compensation and Reimbursement
    
    
    11Section4.10 Application of Funds
    
    
    11Section4.11 Holding of Bonds by Fiduciaries
    
    
    11ARTICLE V
Redemption of Bonds
    
    
    11Section5.1 Authorization for Redemption
    
    
    11Section5.2 Notice of Redemption
    
    
    11Section5.3 Redemption by Lot
    
    
    12Section5.4 Payment on Redemption
    
    
    13ARTICLE VI
Form, Execution, Registration,
Transfer, and
Exchange of Bonds
    
    
    13Section6.1 Form, Execution, and Authentication
    
    
    13Section6.2 Registration, Transfer, and Exchange
of Bonds
    
    
    14(a) Transfer and Registration of
Coupon Bonds
    
    
    14(b) Transfer and Registration of
Registered Bonds
    
    
    14(c) Interchangeability of Bonds
    
    
    15(d) Cancellation and Fees for Exchanges and Transfers
    
    
    15(e) Limitation on Time of Exchange
or Transfer
    
    
    15(f) Bonds Mutilated, Destroyed,
Stolen, or Lost
    
    
    15




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PageARTICLE VII
Modification of Resolutions
and Outstanding
Bonds
    
    
    16Section7.1 Amendments Filing with Trustee
    
    
    16Section7.2 Amendments without Bondholders
Consent
    
    
    16Section7.3 Amendments with Consent of
Holders of
662/3 Percent of Bonds
    
    
    17Section7.4 Amendments with Unanimous Consent
    
    
    18Section7.5 Exclusion of Bonds Held by Corporation
    
    
    18ARTICLE VIII
Remedies on Default
    
    
    18Section8.1 Events of Default
    
    
    18Section8.2 Remedies
    
    
    19ARTICLE IX
Miscellaneous Provisions
    
    
    20Section9.1 Proof of Action by Bondholders
    
    
    20Section9.2 Outstanding Bonds
    
    
    22Section9.3 No Personal Liability on Bonds
    
    
    22Section9.4 Satisfaction and Discharge
    
    
    22Section9.5 Severability of Invalid Provision
    
    
    23Section9.6 Parties in Interest
    
    
    23




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BASIC TENNESSEE VALLEY AUTHORITY
POWER BOND RESOLUTION
 Whereas,
 Therefore, Be It Resolved
  Definitions
and Statutory Authority
 Section Definitions.
 [16
U.S.C. 831-831dd (1958;
Supp. I, 1959)




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[61
Stat. 576-577 (1947) ,




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Section Authority for the Resolution.
  General
Terms and Provisions
 Section Resolution to Constitute a Contract.
 Section Authorization and Issuance of Bonds.
  Section Application of Net Power Proceeds.




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provided, however,
 Section Bond Anticipation Obligations.
 Section Other Indebtedness.
 Section Amortization.




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Section Deposits and Investments.
  Specific
Covenants of the Corporation
 Section Payment of Bonds.
 Section Rates and Charges.
 73 Stat. 284 (1959)




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provided, however,
  Section Protection of Bondholders Investment.
 73 Stat. 284 (1959)




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Section Limitation on Issuance of Bonds.
 1 4 1 4
 Section Depreciation.
 Section Operation and Maintenance.
 Section Mortgaging and Disposal of Power Properties.
 Section Records and Accounts.




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Section Reports.
 Section Covenant to Perform.
  The Trustee, Registrars, and Paying Agents
 Section Trustee.
 Section Registrars and Paying Agents.




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Section Responsibilities of Trustee.
 Section Qualifications of Trustee.
 Section Resignation or Removal of Trustee.




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Section Appointment of Successor Trustee.
 Section Merger, Conversion, or Consolidation of Trustee.
  Section Succession of Fiduciaries.




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Section Compensation and Reimbursement.
 Section Application of Funds.
 Section Holding of Bonds by Fiduciaries.
  Redemption of Bonds
 Section Authorization for Redemption.
 Section Notice of Redemption.




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Section Redemption by Lot.




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Section Payment on Redemption.
   Form, Execution, Registration, Transfer, and Exchange of Bonds
 Section Form, Execution, and Authentication.




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Section Registration, Transfer, and Exchange of Bonds.
 Transfer and Registration of Coupon Bonds.
 Transfer and Registration of Registered Bonds.




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Interchangeability of Bonds.
  Cancellation and Fees for Exchanges and Transfers. provided,
 Limitation on Time of Exchange or Transfer.
 Bonds
Mutilated, Destroyed, Stolen, or Lost.




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Modification of Resolutions and Outstanding Bonds
 Section Amendments Filing with Trustee.
 Section Amendments without Bondholders Consent.




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provided,
   Section Amendments with Consent of Holders of 66 2 / 3 Percent of
Bonds. 2 3 provided, however,




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Section Amendments with Unanimous Consent.
 Section Exclusion of Bonds Held by Corporation.
  Remedies
on Default
 Section Events of Default.




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Section Remedies.




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Miscellaneous Provisions
 Section Proof of Action by Bondholders.




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Section Outstanding Bonds.
 Section No Personal Liability on Bonds.
 Section Satisfaction and Discharge.




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provided, provided further,
 Section Severability of Invalid Provision.
 Section Parties in Interest.




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BANKERS TRUST COMPANYTrusteeBy
    
    /s/ James FlinkAuthorized Officer




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provided




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Addition of Definition of Book-Entry Procedures to Section l.l of the
Resolution.
  Addition of Definition of Book-Entry Bond to Section 1.1 of the
Resolution.
  Addition of Definition of Fiscal Agent to Section
1.1 of the
Resolution.
 2




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Amendment of Section 4.2 of the Resolution
  Addition of New Section 5.5 to the Resolution.
 Redemption of Book-Entry Bonds
 Amendment of Section 6.1 of the Resolution
  3




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Amendment of Section 6.2 of the Resolution
  Amendment of Section 9.1 of the Resolution
    Addition of New Section 9.7 to the
Resolution
 Authority of the Trustee
 4




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Addition of New Section 9.8 to the
Resolution.
 Inconsistency of Provisions
 Addition of New Section 9.9 to the Resolution
 Holders of Book-Entry Bonds
 Addition of New Section 9.10 to the Resolution
 Book-Entry Bonds Deemed to Incorporate Provisions of
Resolution
 5




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TENNESSEE VALLEY AUTHORITY
 POWER BONDS
 THIRD AMENDATORY RESOLUTION TO BASIC TENNESSEE
VALLEY AUTHORITY POWER BOND RESOLUTION
 
  ( )
 provided




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SECTION A.1. Amendment and Restatement of Resolution.
  BASIC
TENNESSEE VALLEY AUTHORITY
 POWER BOND RESOLUTION
   - 2 -




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ARTICLE I
 DEFINITIONS AND STATUTORY AUTHORITY
 SECTION
1.1. Definitions
 Act [16 U.S.C. § § 831-831dd
(1988)]
 Appropriation Investment [61 Stat. 576-577 (1947)
 Board
 Bond Anticipation Obligations
 Bonds
 Book-Entry Bond
 Book-Entry Procedures
 - 3 -




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Certificated Bond
 Corporation
 Evidences of Indebtedness
 Fiscal Agent
 Gross Power Revenues
 Interim Obligations
 Net Power Proceeds
 Power Assets or Power System Assets
 - 4 -




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Power Facility
 Power Program
 Resolution
 Supplemental Resolution
 SECTION 1.2. Authority for the Resolution
 ARTICLE II
 GENERAL TERMS AND PROVISIONS
 SECTION 2.1. Resolution to Constitute a Contract
 SECTION 2.2. Authorization and Issuance of Bonds
 - 5 -




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SECTION 2.3. Application of Net Power Proceeds.
    provided,
however,
 - 6 -




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SECTION 2.4. Bond Anticipation Obligations.
 SECTION 2.5. Other Indebtedness.
 SECTION 2.6. Amortization.
 SECTION 2.7. Deposits and Investments.
 - 7 -




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ARTICLE III
 SPECIFIC COVENANTS OF THE CORPORATION
 SECTION
3.1. Payment of Bonds
 SECTION 3.2. Rates and Charges.
 [73 Stat. 284
(1959)]
  - 8 -




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provided, however
  SECTION 3.3. Protection of Bondholders Investment.
 73 Stat. 284 (1959)
  - 9 -




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SECTION
3.4. Limitation on Issuance of Bonds
  SECTION 3.5. Depreciation
 SECTION 3.6. Operation and Maintenance
 SECTION 3.7. Mortgaging and Disposal of Power Properties
 - 10 -




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SECTION 3.8. Records and Accounts
 SECTION 3.9. Reports
 SECTION 3.10. Covenant to Perform.
 ARTICLE IV
 TRANSFER AGENTS, PAYING AGENTS AND FISCAL AGENTS
 SECTION 4.1. Transfer Agents and Paying Agents; Fiscal Agents
 - 11 -




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SECTION 4.2. Succession of Transfer Agents, Paying Agents, and Fiscal Agents
 - 12 -




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SECTION 4.3. Application of Funds
  SECTION 4.4. Holding of Bonds by Transfer Agents, Paying Agents and Fiscal Agents
 ARTICLE V
 REDEMPTION OF BONDS
 SECTION 5.1. Authorization for Redemption
 SECTION 5.2. Notice of Redemption
 - 13 -




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SECTION 5.3. Redemption by Lot.
 - 14 -




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SECTION 5.4. Payment on Redemption
  SECTION 5.5. Redemption of Book-Entry Bonds
 - 15 -




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ARTICLE VI
 FORM,
EXECUTION, REGISTRATION, TRANSFER, AND EXCHANGE OF BONDS
 SECTION 6.1. Form, Execution, and Authentication
   - 16 -




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SECTION 6.2. Registration, Transfer, and Exchange of Bonds
 Transfer and Registration of Coupon Certificated Bonds.
 - 17 -




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Transfer and Registration of Registered Certificated Bonds.
 Interchangeability of Certificated Bonds.
  (iv) Cancellation and Fees for Exchanges and Transfers of Certificated Bonds. provided,
 - 18 -




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Limitation on Time of Exchange or Transfer of Certificated Bonds
 Certificated Bonds Mutilated, Destroyed, Stolen, or Lost
 - 19 -




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ARTICLE VII
 MODIFICATION OF RESOLUTIONS AND OUTSTANDING BONDS
 SECTION 7.1. AmendmentsGeneral
 SECTION 7.2. Amendments without Bondholders Consent
   - 20 -




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provided,
    SECTION 7.3. Amendments with Consent of Holders of 66 2/3 Percent of Bonds. provided, however,
 - 21 -




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SECTION 7.4. Amendments with Unanimous Consent
 SECTION 7.5. Exclusion of Bonds Held by Corporation.
 - 22 -




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ARTICLE VIII
 REMEDIES ON DEFAULT
 SECTION
8.1. Events of Default
     SECTION 8.2. Remedies
    - 23 -




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- 24 -




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ARTICLE IX
 MISCELLANEOUS PROVISIONS
 SECTION 9.1. Proof of Action by Bondholders
   - 25 -




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- 26 -




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SECTION
9.2. Outstanding Bonds
 SECTION 9.3. No Personal Liability on Bonds.
 SECTION 9.4. Satisfaction and Discharge
  provided
 - 27 -




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provided further
 SECTION 9.5. Severability of Invalid Provision.
 SECTION
9.6. Parties in Interest.
 SECTION 9.7. Inconsistency of Provisions.
 SECTION 9.8. Holders of Book-Entry Bonds.
 - 28 -




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SECTION 9.9. Book-Entry Bonds Deemed to Incorporate Provisions of Resolution
 SECTION A.2. Effect of this Amendatory Resolution on the Holders of Bonds Issued After the
Adoption Hereof.
 - 29 -




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provided




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Amendment of Resolution.
   Application of Net Power Proceeds
 2




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provided, however,
  Other Indebtedness
 3




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Effect of this Amendatory Resolution on the Holders of Bonds Issued After the
Adoption Hereof.
 4