Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Constellation Energy Corporation
(Exact Name of Registrant as Specified in its Charter)
Maryland and Virginia
(States of Incorporation)
52-1964611
(I.R.S. Employer Identification No.)
David A. Brune, Vice President and Secretary
39 W. Lexington Street, Baltimore, Maryland 21201
(410) 234-5685
(Address, including Zip Code, and Telephone Number, including Area Code
of Registrant's Principal Executive Offices and Agent for Service)
Approximate date of commencement of proposed sale to the public: After the
effective date of this Registration Statement as determined by market
conditions.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ X ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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Title of Proposed Proposed
each class of maximum maximum Amount of
securities to Amount to offering aggregate registration
be registered be registered price per unit offering price fee
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Medium-Term Notes, $300,000,000 100%* $300,000,000 $90,910
Series F
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* Inserted solely for the purpose of calculating the registration fee.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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[GRAPHIC OMITTED]
$300,000,000
Medium-Term Notes, Series F
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P R O S P E C T U S
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TERMS OF SALE
Constellation Energy Corporation may sell notes at one or more times with the
following terms. The final terms for each note will be included in a pricing
supplement. We will receive between $299,625,000 and $297,750,000 of the
proceeds from the sale of the notes, after paying the agents commissions of
between $375,000 and $2,250,000.
- - Mature 9 months to 30 years
- - Fixed or floating interest rate. The floating interest rate formula would
be based on:
Commercial paper rate
Prime rate
CD rate
Federal Funds effective rate
LIBOR
Treasury rate
CMT rate
- - Remarketing features
- - Certificate or book-entry form
- - Subject to redemption and repurchase at option of the company or holder
- - Not convertible, amortized or subject to a sinking fund
- - Interest paid on fixed rate notes on May 1 and November 1
- - Interest paid on floating rate notes monthly, quarterly, semi-annually, or
annually
- - Minimum denominations of $1,000, increased in multiples of $1,000
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The notes have not been approved by the SEC or any state securities commission,
nor have these organizations determined that this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
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LEHMAN BROTHERS
GOLDMAN, SACHS & CO.
MERRIL LYNCH & CO.
Agents
(Once the registration statement is effective, the date of the prospectus will
be inserted here.)
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Prospectus Summary
The information in the Prospectus Summary is qualified in its entirety by
reference to the more detailed information and financial statements appearing
elsewhere in this prospectus and in the documents incorporated by reference
herein.
Constellation Energy Corporation
Baltimore Gas and Electric Company (BGE) and Potomac Electric Power Company
(PEPCO) have merged into Constellation Energy Corporation. See the section in
this Prospectus titled Constellation Energy for additional information.
Business .....................................Electric and Gas Utility
Service Area ............................. Maryland-Central Maryland
(including Baltimore City and 10
surrounding counties)
Washington, DC
Service area population (December 31, 1996) ..Electric: 4,650,000;
Gas: 2,000,000
Customers (December 31, 1996) ................Electric: 1,785,994;
Gas: 556,734
Proforma Selected Financial and Operating Information - December 31, 1996
(Amounts in millions, except per share amounts)
Summary of Operations
- ---------------------
Operating Revenues $ 5,280
Earnings Before Interest, Income Taxes,
and Depreciation and Amortization $ 1,769
Net Income $ 548
Earnings Per Share $ 1.85
Ratio of Earnings to Fixed Charges 2.64
Financial Statistics at Year End
- --------------------------------
Total Assets $15,382
Capitalization:
Long-Term Debt $ 5,322
Preferred and Preference Stock 612
Common Shareholders' Equity 4,746
--------
Total Capitalization $10,680
Book Value Per Share $ 17.86
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms. Our SEC filings are also available to the public
from our web site at htpp://www.constellation.com or at the SEC's web site at
http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and later information that we file with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
until we sell all the notes. We also incorporate by reference any future filings
made with the SEC by BGE and PEPCO between the date of this prospectus and the
effective time of the merger of BGE and PEPCO into Constellation Energy under
Sections 13(a), 13(c), 14 or 15(d) of the Securities and Exchange Act of 1934.
This prospectus is part of a registration statement we filed with the SEC.
- - BGE's Annual Report on Form 10-K for the year ended December 31, 1996;
- - PEPCO's Annual Report on Form 10-K for the year ended December 31, 1996;
- - BGE's Current Reports on Form 8-K dated February 26, 1997, March 7, 1997
and April 7, 1997;
- - PEPCO's Current Report on Form 8-K dated April 7, 1997.
You may request a copy of these filings, at no cost, by writing us at:
Shareholder Services
Constellation Energy Corporation
P.O. Box 98295
Washington, DC 20090-8295
or faxing us at: (202) 331-6874
or telephoning us at:
Within Washington, DC (202) 872-3183
Outside Washington, DC 1-800-527-3726
You should rely only on the information incorporated by reference or provided in
this prospectus. We have not authorized anyone else to provide you with
different information. We are not making an offer of these securities in any
state where the offer is not permitted. You should not assume that the
information in this prospectus is accurate as of any date other than the date on
the front of this prospectus.
CONSTELLATION ENERGY
BGE and PEPCO have merged into Constellation Energy Corporation. As a public
utility Constellation Energy and its predecessors have, combined, served the
Baltimore and Washington metropolitan areas, including the City of Baltimore and
the District of Columbia, for over a century. We produce, purchase, transmit,
distribute and sell electricity, and purchase, transport and sell natural gas.
We jointly own and operate two electric generating plants and one hydro electric
plant in Pennsylvania. In addition, we supply, at wholesale, electric energy to
the Southern Maryland Electric Cooperative, Inc.
We also have several wholly owned subsidiaries that are engaged in several
diversified business activities, including:
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- - energy marketing activities, specifically power marketing, natural gas
brokering, energy services and district heating and cooling projects,
- - power generation projects outside our service territory,
- - investment activities (including leveraged leases of generating plants and
aircraft),
- - real estate,
- - senior living facilities, and
- - appliance sales and service, heating and air conditioning sales and
service, and home improvements.
Our principal offices will be located in Annapolis, Maryland. However, until the
offices are constructed our principal offices will be temporarily located at 39
W. Lexington Street, Baltimore, Maryland 21201; our mailing address is P.O. Box
1475, Baltimore, Maryland 21203-1475; and our telephone number is (410)
234-5000.
PRICING SUPPLEMENT
The pricing supplement for each offering of notes will contain the specific
information and terms for that offering. The pricing supplement may also add,
update or change information contained in this prospectus. It is important for
you to consider the information contained in this prospectus and the pricing
supplement in making your investment decision.
USE OF PROCEEDS
The net proceeds from the sale of the notes will be used for general corporate
purposes relating to our utility business, including repayment of commercial
paper borrowings used to finance construction, other capital expenditures, and
operations. If we do not use the net proceeds immediately, we temporarily invest
them in short-term, interest-bearing obligations. For current information on our
commercial paper balances and average interest rate, see our most recent Form
10-K and 10-Q. Please also refer to the BGE and PEPCO Forms 10-K for the year
ended December 31, 1996 and any other filings made by BGE and PEPCO prior to the
effectiveness of the merger of BGE and PEPCO into Constellation Energy. See
Where You Can Find More Information.
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RATIO OF EARNINGS TO FIXED CHARGES
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The proforma Ratio of Earnings to Fixed Charges for each of the periods
indicated is as follows:
Twelve Months Ended December 31,
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
2.64 2.29 2.74 2.64 2.41
For current information on the Ratio of Earnings to Fixed Charges, please see
our most recent Form 10-K and 10-Q. For historical information about BGE's and
PEPCO's Ratios of Earnings to Fixed Charges, please refer to the BGE and PEPCO
Forms 10-K for the year ended December 31, 1996 and any other filings made by
BGE and PEPCO prior to the effectiveness of the merger of BGE and PEPCO into
Constellation Energy. See Where You Can Find More Information.
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DESCRIPTION OF THE NOTES
General
We will issue the notes under an indenture between us and the Trustee, The Bank
of New York dated April 4, 1997. This prospectus briefly outlines some of the
indenture provisions. If you would like more information on these provisions,
review the indenture that we filed with the SEC. See Where You Can Find More
Information on how to locate the indenture. You may also review the indenture at
the Trustee's offices at 101 Barclay Street, New York, New York.
The indenture does not limit the amount of notes that may be issued. Each series
of notes may differ as to their terms. For current information on our debt
outstanding see our most recent Form 10-K and 10-Q. Please also refer to the BGE
and PEPCO Forms 10-K for the year ended December 31, 1996 and any other filings
made by BGE and PEPCO prior to the effectiveness of the merger of BGE and PEPCO
into Constellation Energy. See Where You Can Find More Information.
The notes are unsecured and will rank equally with all our unsecured
indebtedness. The notes will be denominated in U.S. dollars and we will pay
principal and interest in U.S. dollars. The notes will not be subject to any
conversion, amortization, or sinking fund. It is anticipated that the notes will
be "book-entry," represented by a permanent global note registered in the name
of The Depository Trust Company, or its nominee. However, we reserve the right
to issue notes in certificate form registered in the name of the noteholders.
In the discussion that follows, whenever we talk about paying principal on the
notes, we mean at maturity, redemption or repurchase. Also, in discussing the
time for notices and how the different interest rates are calculated, all times
are New York City time, unless otherwise noted.
The following terms may apply to each note as specified in the applicable
pricing supplement and the note.
Redemptions
We may redeem notes at our option. Notes may be redeemable in whole or in part
in increments of $1,000 upon no more than 60, and not less than 30, days prior
notice. If we do not redeem all the notes of a series at one time, the Trustee
selects the notes to be redeemed in a manner it determines to be fair.
Repurchases
The noteholder may have the right to cause us to repurchase the notes. We will
repurchase the notes in whole or in part in increments of $1,000. The method for
repurchases differs for book-entry and certificate notes, and is discussed on
page 7.
Remarketed Notes
We may issue notes with remarketing features. The applicable pricing supplement
will describe the terms for the notes including: interest rate, remarketing
provisions, our right to redeem notes, the holders' right to tender notes, and
any other provisions.
Book-Entry Notes - Registration, Transfer, and Payment of Interest and Principal
Book-entry notes of a series will be issued in the form of a global note that
will be deposited with The Depository Trust Company, New York, New York ("DTC").
This means that we will not issue certificates to each holder. One global note
will be issued to DTC who will keep a computerized record of its participants
(for example, your broker) whose clients have purchased the notes. The
participant will then keep a
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record of its clients who purchased the notes. Unless it is exchanged in whole
or in part for a certificate note, a global note may not be transferred; except
that DTC, its nominees, and their successors may transfer a global note as a
whole to one another.
Beneficial interests in global notes will be shown on, and transfers of global
notes will be made only through, records maintained by DTC and its participants.
DTC has provided us the following information: DTC is a limited-purpose trust
company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the United States
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered under the
provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds
securities that its participants ("Direct Participants") deposit with DTC. DTC
also records the settlement among Direct Participants of securities
transactions, such as transfers and pledges, in deposited securities through
computerized records for Direct Participant's accounts. This eliminates the need
to exchange certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations.
DTC's book-entry system is also used by other organizations such as securities
brokers and dealers, banks and trust companies that work through a Direct
Participant. The rules that apply to DTC and its participants are on file with
the SEC.
DTC is owned by a number of its Direct Participants and by the New York Stock
Exchange, Inc., The American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc.
We will wire principal and interest payments to DTC's nominee. We and the
Trustee will treat DTC's nominee as the owner of the global notes for all
purposes. Accordingly, we, the Trustee and any paying agent will have no direct
responsibility or liability to pay amounts due on the global notes to owners of
beneficial interests in the global notes.
It is DTC's current practice, upon receipt of any payment of principal or
interest, to credit Direct Participants' accounts on the payment date according
to their respective holdings of beneficial interests in the global notes as
shown on DTC's records. In addition, it is DTC's current practice to assign any
consenting or voting rights to Direct Participants whose accounts are credited
with notes on a record date, by using an omnibus proxy. Payments by participants
to owners of beneficial interests in the global notes, and voting by
participants, will be governed by the customary practices between the
participants and owners of beneficial interests, as is the case with notes held
for the account of customers registered in "street name." However, payments will
be the responsibility of the participants and not of DTC, the Trustee or us.
Notes represented by a global note will be exchangeable for certificate notes
with the same terms in authorized denominations only if:
- - DTC notifies us that it is unwilling or unable to continue as depositary or
if DTC ceases to be a clearing agency registered under applicable law and a
successor depositary is not appointed by us within 90 days; or
- - we determine not to require all of the notes of a series to be represented
by a global note and notify the Trustee of our decision.
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Book-Entry Notes - Method of Repurchase
Participants, on behalf of the owners of beneficial interests in the global
notes, may exercise the repurchase option by delivering written notice to our
paying agent at least 30, but no more than 60, days prior to the date of
repurchase. The paying agent must receive notice by 5:00 p.m. on the last day
for giving notice. Procedures for the owners of beneficial interests in global
notes to notify their participants of their desire to have their note
repurchased will be governed by the customary practices of the participant. The
written notice to the paying agent must state the principal amount to be
repurchased. It is irrevocable and a duly authorized officer of the participant
(with signatures guaranteed) must sign it.
Certificate Notes - Registration, Transfer, and Payment of Interest and
Principal
If we issue certificate notes, they will be registered in the name of the
noteholder. The notes may be transferred or exchanged, pursuant to
administrative procedures in the Indenture, without the payment of any service
charge (other than any tax or other governmental charge) by contacting the
paying agent.
Holders of over $5 million in principal amount of notes can request that payment
of principal and interest be wired to them by contacting the paying agent at the
address set forth above at least one business day prior to the payment date.
Otherwise, payments will be made by check.
Certificate Notes - Method of Repurchase
Noteholders desiring to exercise their repurchase option must notify the paying
agent at least 30 but not more than 45 calendar days prior to the repayment date
by providing the bank:
- - the note, with the section entitled "Option to Elect Repayment" on the
reverse of the note completed; or
- - a fax or letter (first class, postage prepaid) from a member of a national
securities exchange, the National Association of Securities Dealers, or a
bank or trust company in the United States which states the following:
o the name of the holder;
o the principal amount of the note and the amount to be repurchased;
o the certificate number or the maturity and a description of the terms
of the note;
o a statement that you wish to sell all or a portion of your note; and
o a guaranty that the note with the section entitled "Option to Elect
Repayment" on the reverse of the note completed will be received by
the paying by the paying agent within 5 business days.
The note and form must be received by the paying agent by such 5th business day.
Your notice of repurchase is irrevocable.
If you sell a portion of a note, the old note will be canceled and a new note
for the remaining principal amount will be issued to you.
Interest Rate
General
We have provided a Glossary at the end of this prospectus to define the
capitalized words used in discussing the interest rates payable on the notes.
The interest rate on the notes will either be fixed or floating. The interest
paid will include interest accrued to, but
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excluding, the date of maturity, redemption or repurchase. Interest is generally
payable to the person in whose name the note is registered at the close of
business on the record date before each interest payment date. Interest payable
at maturity, redemption, or repurchase, however, will be payable to the person
to whom principal is payable.
The first interest payment on any note originally issued between a record date
and interest payment date, or on an interest payment date, will be made on the
interest payment date after the next record date.
Interest payments, other than those payable at maturity, redemption or
repurchase, will be paid, at our option, by check or wire transfer.
Fixed Rate Notes
Each pricing supplement will designate the fixed rate of interest payable on a
note. Interest will be paid May 1 and November 1, and upon maturity, redemption
or repurchase. If any payment date falls on a day that is not a Business Day,
payment will be made on the next Business Day and no additional interest will be
paid. The record dates for such notes will be April 15 (for interest to be paid
on May 1) and October 15 (for interest to be paid on November 1). Interest
payments will be the amount of interest accrued to, but excluding, each May 1
and November 1. Interest will be computed using a 360-day year of twelve 30-day
months.
Floating Rate Notes
General
Each floating rate note will have an interest rate formula. The formula may be
based on:
- - the commercial paper rate;
- - the prime rate;
- - the CD rate;
- - the federal funds effective rate;
- - the LIBOR;
- - the Treasury rate;
- - the CMT rate;
- - or another interest rate index.
The applicable pricing supplement will also indicate the Spread and/or Spread
Multiplier, if any. In addition, any floating rate note may have a maximum or
minimum interest rate limitation.
Upon request, the Calculation Agent will provide the current interest rate and,
if different, the interest rate which will become effective on the next Interest
Reset Date.
Date of Interest Rate Change
The interest rate on each floating rate note may be reset daily, weekly,
monthly, quarterly, semi-annually, or annually. The Interest Reset Date will be:
- - for notes which reset daily, each Business Day;
- - for notes (other than Treasury rate notes) which reset weekly, the
Wednesday of each week;
- - for Treasury rate notes which reset weekly, the Tuesday of each week;
- - for notes which reset monthly, the third Wednesday of each month;
- - for notes which reset quarterly, the third Wednesday of March, June,
September and December;
- - for notes which reset semi-annually, the third Wednesday of the two months
of each year indicated in the applicable pricing supplement; and
- - for notes which reset annually, the third Wednesday of the month of each
year indicated in the applicable pricing supplement.
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The initial interest rate or interest rate formula on each note effective until
the first Interest Reset Date will be indicated in the applicable pricing
supplement. Thereafter, the interest rate will be the rate determined on the
next Interest Determination Date, as explained below. Each time a new interest
rate is determined, it will become effective on the subsequent Interest Reset
Date. If any Interest Reset Date is not a Business Day, then the Interest Reset
Date will be postponed to the next Business Day. However, in the case of a LIBOR
note, if the next Business Day is in the next calendar month, the Interest Reset
Date will be the immediately preceding Business Day.
When Interest Rate Is Determined
The Interest Determination Date for all notes (except Treasury rate notes) is
the second Business Day before the Interest Reset Date.
The Interest Determination Date for Treasury rate notes will be the day of the
week in which the Interest Reset Date falls on which Treasury bills would
normally be auctioned. Treasury bills are usually sold at auction on Monday of
each week, unless that day is a legal holiday, in which case the auction is
usually held on Tuesday. However, the auction may be held on the preceding
Friday. If an auction is held on the preceding Friday, that day will be the
Interest Determination Date pertaining to the Interest Reset Date occurring in
the next week. If an auction date falls on any Interest Reset Date then the
Interest Reset Date will instead be the first Business Day immediately following
the auction date.
When Interest Is Paid
Interest is paid as follows:
- - for notes which reset daily or weekly, on the third Wednesday of March,
June, September and December; for notes which reset monthly, on the third
Wednesday of each month or on the third Wednesday of March, June, September
and December (as indicated in the applicable pricing supplement);
- - for notes which reset quarterly, on the third Wednesday of March, June,
September, and December;
- - for notes which reset semi-annually, on the third Wednesday of the two
months specified in the appplicable pricing supplement;
- - for notes which reset annually, on the third Wednesday of the month
specified in the applicable pricing supplement; and
- - at maturity, redemption or repurchase.
If interest is payable on a day which is not a Business Day, payment will be
postponed to the next Business Day. However, for LIBOR notes, if the next
Business Day is in the next calendar month, interest will be paid on the
preceding Business Day.
The record date will be 15 calendar days prior to each day interest is paid,
whether or not such day is a Business Day.
The interest payable will be the amount of interest accrued to, but excluding,
the interest payment date. However, for notes on which the interest resets daily
or weekly, the interest payable will include interest accrued to and including
the record date prior to the interest payment date. If the interest payment date
is also a day that principal is due, the interest payable will include interest
accrued to, but exclude, the date of maturity, redemption or repurchase.
The accrued interest for any period is calculated by multiplying the principal
amount of a note by an accrued interest factor. The accrued interest factor is
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computed by adding the interest factor calculated for each day in the period to
the date for which accrued interest is being calculated. The interest factor
(expressed as a decimal rounded upwards if necessary, as described below) is
computed by dividing the interest rate (expressed as a decimal rounded upwards
if necessary) applicable to such date by 360, unless the notes are Treasury rate
notes or CMT rate notes in which case it will be divided by the actual number of
days in the year.
All percentages resulting from any calculation of floating rate notes will be
rounded, if necessary, to the nearest one-hundred thousandth of a percentage
point, with five one-millionths of a percentage point rounded upwards (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or .0987655) and 9.876544%
(or .09876544) being rounded to 9.87654% (or .0987654)), and all dollar amounts
used in or resulting from such calculation will be rounded to the nearest cent
(with one-half cent being rounded upwards).
Commercial Paper Rate Notes
Each commercial paper rate note will bear interest at the rate (calculated with
reference to the Commercial Paper Rate and the Spread and/or Spread Multiplier,
if any) specified on the commercial paper rate note and in the applicable
pricing supplement.
"Commercial Paper Rate" means, with respect to any Commercial Paper Interest
Determination Date, the Money Market Yield (calculated as described below) of
the rate on such date for commercial paper having the Index Maturity specified
in the applicable pricing supplement as published in H.15(519) under the heading
"Commercial Paper."
The following procedures will occur if the rate cannot be set as described
above:
(a) If that rate is not published in H.15(519) prior to 9:00 A.M. on the
Calculation Date, then the Commercial Paper Rate will be the Money Market Yield
of the rate on the Commercial Paper Interest Determination Date for commercial
paper having the Index Maturity specified in the applicable pricing supplement
as published in Composite Quotations under the heading "Commercial Paper."
(b) If the rate is not published or in Composite Quotations by 3:00 P.M. on the
Calculation Date, the Commercial Paper Rate for that Commercial Paper Interest
Determination Date will then be calculated by the Calculation Agent in the
following manner.
The Commercial Paper Rate will be calculated as the Money Market Yield of the
average for the offered rates, as of 11:00 A.M., on that date, of three leading
dealers of commercial paper in New York selected for commercial paper having the
applicable Index Maturity placed for an industrial issuer whose bond rating is
"AA," or the equivalent, from a nationally recognized rating agency.
(c) Finally, if fewer than three dealers are quoting as mentioned, the rate of
interest in effect for the applicable period will be the same as the rate of
interest in effect for the prior interest reset period.
Prime Rate Notes
Each prime rate note will bear interest at the rate (calculated with reference
to the Prime Rate and the Spread and/or Spread Multiplier, if any) specified on
the prime rate note and in the applicable pricing supplement.
"Prime Rate" means, with respect to any Prime Rate Interest Determination Date,
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the rate set forth on such date in H.15(519) under the heading "Bank Prime
Loan."
The following procedures will occur if the rate cannot be set as described
above:
(a) If that rate is not published in H.15(519) prior to 9:00 A.M. on the
Calculation Date, then the Prime Rate will be the average (rounded upwards, if
necessary, to the next higher one-hundred thousandth of a percentage point) of
the rates of interest publicly announced by each bank that appear on the Reuters
Screen USPRIMEONE Page as its prime rate or base lending rate as in effect for
that Prime Rate Interest Determination Date.
(b) If fewer than four, but more than one, rates appear on the Reuters Screen
USPRIMEONE Page, the Prime Rate will be the average of the prime rates (quoted
on the basis of the actual number of days in the year divided by a 360-day year)
as of the close of business on the Prime Rate Interest Determination Date by
four major money center banks in New York selected by the Calculation Agent.
(c) If fewer than two rates appear, the Prime Rate shall be determined on the
basis of the rates furnished in New York by the appropriate number of substitute
banks or trust companies organized and doing business under the laws of the
United States, or any State thereof, having total equity capital of at least
$500 million and being subject to supervision or examination by a Federal or
State authority, as selected by the Calculation Agent.
(d) Finally, if the banks are not quoting as mentioned above, the rate of
interest in effect for the applicable period will be the same as the rate of
interest in effect for the prior interest reset period.
CD Rate Notes
Each CD rate note will bear interest at the rate (calculated with reference to
the CD Rate and the Spread and/or Spread Multiplier, if any) specified on the CD
rate note and in the applicable pricing supplement.
"CD Rate" means, with respect to any CD Rate Interest Determination Date, the
rate on that date for negotiable certificates of deposit having the Index
Maturity specified in the applicable pricing supplement as published in
H.15(519) under the heading "CDs (Secondary Market)."
The following procedures will occur if the rate cannot be set as described
above:
(a) If that rate is not published in H.15(519) prior to 9:00 A.M. on the
Calculation Date, then the CD Rate will be the rate on that CD Rate Interest
Determination Date for negotiable certificates of deposit having the applicable
Index Maturity as published in Composite Quotations under the heading
"Certificates of Deposit."
(b) If that rate is not published in Composite Quotations by 3:00 P.M. on that
Calculation Date, the CD Rate for that CD Interest Determination Date shall be
calculated by the Calculation Agent as follows:
The CD Rate will be calculated as the average of the secondary market offered
rates, as of 10:00 A.M., of three leading nonbank dealers of negotiable U.S.
dollar certificates of deposit in New York selected by the Calculation Agent for
negotiable certificates of deposit of major United States money market banks
with a remaining maturity closest to the Index Maturity specified in the
applicable pricing supplement in a denomination of $5,000,000.
(c) Finally, if fewer than three dealers are quoting as mentioned, the rate of
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interest in effect for the applicable period will be the same as the rate of
interest in effect for the prior interest reset period.
Federal Funds Effective Rate Notes
Each federal funds effective rate note will bear interest at the rate
(calculated with reference to the Federal Funds Effective Rate and the Spread
and/or Spread Multiplier, if any) specified on the federal funds effective rate
note and in the applicable pricing supplement.
"Federal Funds Effective Rate" means, with respect to any Federal Funds
Effective Interest Determination Date, the rate on such date for Federal Funds
as published in H.15(519) prior to 11:00 A.M. under the heading "Federal Funds
(Effective)."
The following procedures will occur if the rate cannot be set as described
above:
(a) If that rate is not published in H.15(519) prior to 11:00 A.M. on the
Calculation Date, then the Federal Funds Effective Rate will be the rate on that
Federal Funds Effective Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate."
(b) If that rate is not published in Composite Quotations by 3:00 P.M. on the
Calculation Date, the Federal Funds Effective Rate for that Federal Funds
Effective Interest Determination Date will be calculated by the Calculation
Agent as follows:
The Federal Funds Effective Rate will be the average of the rates, as of 11:00
A.M. on that date, for the last transaction in overnight Federal Funds arranged
by three leading brokers of federal funds transaction in New York selected by
the Calculation Agent.
(c) Finally, if fewer than three brokers are quoting as mentioned above, the
rate of interest in effect for the applicable period will be the same as the
rate of interest in effect for the prior interest reset period.
LIBOR Notes
Each LIBOR note will bear interest at the rate (calculated with reference to
LIBOR and the Spread and/or Spread Multiplier, if any) specified on the LIBOR
note and in the applicable pricing supplement.
LIBOR will be determined by the Calculation Agent as follows:
(a) With respect to any LIBOR Interest Determination Date, LIBOR will be
determined by either:
(1) the average of the offered rates for deposits of not less than
$1,000,000 in U.S. dollars having the Index Maturity specified in the applicable
pricing supplement, beginning on the second Business Day immediately after that
date, that appear on the Reuters Screen LIBO Page as of 11:00 A.M., London time,
on that date, if at least two offered rates appear on the Reuters Screen LIBO
Page; or
(2) the rate for deposits in U.S. dollars having the Index Maturity
designated in the applicable pricing supplement, beginning on the second London
Business Day immediately after such date, that appears on the Telerate Page 3750
as of 11:00 A.M., London time, on that date.
If neither Reuters Screen LIBO Page nor Telerate Page 3750 is specified in the
applicable pricing supplement, LIBOR will be determined as if Telerate Page 3750
had been specified.
In the case where (1) above applies, if fewer than two offered rates appear on
the Reuters Screen LIBO Page, or, in the case where (2) above applies, if no
rate appears on the Telerate Page
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3750, LIBOR for that date will be determined as follows:
(b) LIBOR will be determined based on the rates at approximately 11:00 A.M.,
London time, on that LIBOR Interest Determination Date at which deposits of not
less than $1,000,000 in U.S. dollars having the applicable Index Maturity are
offered to prime banks in the London interbank market by four major banks in the
London interbank market selected by the Calculation Agent that in the
Calculation Agent's judgment is representative for a single transaction in such
market at such time (a "Representative Amount"). The offered rates must begin on
the second Business Day immediately after that LIBOR Interest Determination
Date.
The Calculation Agent will request the principal London office of each such bank
to provide a quotation of its rate. If at least two such quotations are
provided, LIBOR for such date will be the average of such quotations.
(c) If fewer than two quotations are provided, LIBOR for that date will be the
average of the rates quoted at approximately 11:00 A.M., New York City time, on
such date by three major banks in New York, selected by the Calculation Agent.
The rates will be for loans in U.S. dollars to leading European banks having the
specified Index Maturity beginning on the second Business Day after that date
and in a Representative Amount.
(d) Finally, if fewer than three banks are quoting as mentioned, the rate of
interest in effect for the applicable period will be the same as the rate of
interest in effect for the prior interest reset period.
Treasury Rate Notes
Each Treasury rate note will bear interest at the rate (calculated with
reference to the Treasury Rate and the Spread and/or Spread Multiplier, if any)
specified on the Treasury rate note and in the applicable pricing supplement.
"Treasury Rate" means, with respect to any Treasury Interest Determination Date,
the rate for the most recent auction of direct obligations of the United States
("Treasury bills") having the Index Maturity specified in the applicable pricing
supplement as published in H.15(519) under the heading "U.S. Government
Securities/Treasury Bills/Auction Average (Investment)."
The following procedures will occur if the rate cannot be set as described
above:
(a) If that rate is not published in H.15(519) by 9:00 A.M. on the applicable
Calculation Date, the rate will be the auction average rate (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) for such auction as otherwise announced by the United
States Department of the Treasury.
(b) If the results of the auction of Treasury bills having the applicable Index
Maturity are not published in H.15(519) by 9:00 A.M., or otherwise published or
reported as provided above by 3:00 P.M., on the Calculation Date, or if no
auction is held in a particular week, then the Treasury Rate shall be calculated
by the Calculation Agent as follows:
The rate will be calculated as a yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the average of the secondary market bid rates as of
approximately 3:30 P.M. on the Treasury Interest Determination Date, of three
leading primary United States government securities dealers in New York selected
by the Calculation Agent for the issue of Treasury bills with a
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remaining maturity closest to the specified Index Maturity.
(c) Finally, if fewer than three dealers are quoting as mentioned, the rate of
interest in effect for the period will be the same as the rate of interest in
effect for the prior interest reset period.
CMT Rate Notes
Each CMT rate note will bear interest at the rate (calculated with reference to
the CMT Rate and the Spread or Spread Multiplier, if any) specified on such CMT
rate note and in the applicable pricing supplement.
"CMT Rate" means, with respect to any CMT Interest Determination Date, the rate
displayed on the Designated CMT Telerate Page under the caption "... Treasury
Constant Maturities.. Federal Reserve Board Release H.15... Mondays
Approximately 3:45 P.M.," under the column for the applicable Index Maturity
designated in the applicable pricing supplement for:
(1) if the Designated CMT Telerate Page is 7055, the rate for
the applicable CMT Interest Determination Date; or
(2) if the Designated CMT Telerate Page is 7052, the week, or the month,
as applicable, ended immediately preceding the week in which the CMT Interest
Determination Date occurs.
The following procedures will occur if the rate cannot be set as described
above:
(a) If no page is specified in the applicable pricing supplement and on the face
of such CMT Rate Note, the Designated CMT Telerate Page shall be 7052, for the
most recent week. If such rate is no longer displayed on the relevant page, or
if it is not displayed by 3:00 P.M. on the related Calculation Date, then the
CMT Rate will be the Treasury constant maturity rate for the applicable Index
Maturity as published in the relevant H.15 (519).
(b) If that rate is no longer published in H.15(519), or is not published by
3:00 P.M. on the related Calculation Date, then the CMT Rate for such CMT
Interest Determination Date will be the Treasury constant maturity rate for the
applicable Index Maturity (or other United States Treasury rate for such Index
Maturity for that CMT Interest Determination Date with respect to such Interest
Reset Date) as may then be published by either the Federal Reserve Board or the
United States Department of the Treasury that the Calculation Agent determines
to be comparable to the rate formerly displayed on the Designated CMT Telerate
Page and published in the relevant H.15(519).
(c) If that information is not provided by 3:00 P.M. on the related Calculation
Date, then the CMT Rate for that CMT Interest Determination Date will be
calculated by the Calculation Agent as follows:
The rate will be calculated as a yield to maturity, based on the average of the
secondary market closing offer side prices as of approximately 3:30 P.M. on that
CMT Interest Determination Date reported, according to their written records, by
three leading primary United States government securities dealers (each, a
"Reference Dealer") in New York selected by the Calculation Agent. These dealers
will be selected from five such Reference Dealers.
The Calculation Agent will eliminate the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest)), for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury Note") with an original
maturity of approximately the applicable Index Maturity and a remaining term to
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maturity of not less than such Index Maturity minus one year.
If two Treasury Notes with an original maturity as described in the preceding
sentence have remaining terms to maturity equally close to the applicable Index
Maturity, the quotes for the Treasury Note with the shorter remaining term to
maturity will be used.
(d) If the Calculation Agent cannot obtain three such Treasury Note quotations,
the CMT Rate for that CMT Interest Determination Date will be calculated by the
Calculation Agent as follows:
The rate will be calculated as a yield to maturity based on the average of the
secondary market offer side prices as of approximately 3:30 P.M. on that CMT
Interest Determination Date of three Reference Dealers in New York selected by
the Calculation Agent using the same method described above, for Treasury Notes
with an original maturity of the number of years that is the next highest to the
applicable Index Maturity with a remaining term to maturity closest to such
Index Maturity and in an amount of at least $100 million.
If three or four (and not five) of the Reference Dealers are quoting as
described above, then the CMT Rate will be based on the average of the offer
prices obtained and neither the highest nor the lowest of such quotes will be
eliminated.
(e) Finally, if fewer than three Reference Dealers are quoting as mentioned, the
rate of interest in effect for the applicable period will be the same as the
rate of interest in effect for the prior interest reset period.
Event of Default
"Event of Default" means any of the following:
- - failure to pay the principal of (or premium, if any, on) any note of a
series when due and payable;
- - failure to pay for 30 days any interest on any note of any series;
- - failure to perform any other requirements in the notes, or in the indenture
in regard to such notes, for 60 days after notice; or
- - certain events of insolvency.
An Event of Default for a particular series of notes does not necessarily mean
that an Event of Default has occurred for any other series of notes issued under
the indenture. If an Event of Default shall have occurred and be continuing the
Trustee or the holders of at least 33% of the principal amount of the notes of
the series affected by an Event of Default may require us to repay the entire
principal of the notes of such series immediately. Subject to certain
conditions, this requirement may be rescinded by the holders of at least a
majority in aggregate principal amount of the notes of the series.
The Trustee must within 90 days after a default occurs, notify the holders of
the notes of the series of the default if we have not remedied it (default is
defined to include the events specified above without the grace periods or
notice). The Trustee may withhold notice to the holders of such notes of any
default (except in the payment of principal or interest) if it in good faith
considers such withholding in the interest of the holders. We are required to
file an annual certificate with the Trustee, signed by an officer, about any
default by us under any provisions of the indenture.
Subject to the provisions of the indenture relating to its duties in case of
default, the Trustee shall be under no obligation to exercise any of its rights
or powers under the indenture at the request, order or direction of any
15
<PAGE>
holders unless such holders offer the Trustee reasonable indemnity. Subject to
the provisions for indemnification, the holders of a majority in principal
amount of the notes of any series may direct the time, method and place of
conducting any proceedings for any remedy available to, or exercising any trust
or power conferred on, the Trustee with respect to such notes.
Modification of Indenture
Under the indenture, our rights and obligations and the rights of the holders of
any notes may be changed. Any change requires the consent of the holders of not
less than 66 2/3% in aggregate principal amount of the outstanding notes of all
series to be affected, voting as one class. However, no changes to the terms of
payment of principal or interest, or reducing the percentage required for
changes, is effective against any holder without its consent.
Consolidation, Merger or Sale
We may not merge or consolidate with any corporation or sell substantially all
of our assets as an entirety unless:
- - we are the continuing corporation or the successor corporation expressly
assumes the payment of principal, and premium, if any, and interest on the
notes and the performance and observance of all the covenants and
conditions of the indenture binding on us; and
- - we, or the successor corporation, are not immediately after the merger,
consolidation, or sale in default in the performance of a covenant or
condition in the indenture.
PLAN OF DISTRIBUTION
We may sell the notes (a) through agents; (b) through underwriters or dealers;
or (c) directly to one or more purchasers.
By Agents
Notes may be sold on a continuing basis through agents designated by us. The
agents agree to use their reasonable efforts to solicit purchases for the period
of their appointment.
The notes will be sold to the public at 100% of their principal amount. Agents
will receive commissions from .125% to .75% of the principal amount per note
depending on the maturity of the note they sell. We will receive from 99.875% to
99.25% of the principal amount of each note, before deducting expenses of
approximately $350,000.
The Agents will not be obligated to make a market in the notes. We cannot
predict the amount of trading or liquidity of the notes.
By Underwriters
If underwriters are used in the sale, the notes will be acquired by the
underwriters for their own account. The underwriters may resell the notes in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
obligations of the underwriters to purchase the notes will be subject to certain
conditions. The underwriters will be obligated to purchase all the notes of the
series offered if any of the notes are purchased. Any initial public offering
price and any discounts or concessions allowed or re-allowed or paid to dealers
may be changed from time to time.
Direct Sales
We may also sell notes directly. In this case, no underwriters or agents would
be involved.
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General Information
Underwriters, dealers, and agents that participate in the distribution of the
notes may be underwriters as defined in the Securities Act of 1933 (the "Act"),
and any discounts or commissions received by them from us and any profit on the
resale of the notes by them may be treated as underwriting discounts and
commissions under the Act.
We may have agreements with the underwriters, dealers and agents to indemnify
them against certain civil liabilities, including liabilities under the Act, or
to contribute with respect to payments which the underwriters, dealers or agents
may be required to make.
Underwriters, dealers and agents may engage in transactions with, or perform
services for, us or our subsidiaries in the ordinary course of their businesses.
LEGAL OPINIONS
Prior to the merger, either a BGE or PEPCO lawyer will issue an opinion
regarding certain legal matters in connection with the notes offered hereby.
That lawyer will rely upon the opinion of Piper & Marbury L.L.P. as to matters
of Virginia law.
After the merger, one of our lawyers will issue an opinion regarding certain
legal matters in connection with the notes offered hereby. That lawyer will rely
upon the opinion of Piper & Marbury L.L.P. as to matters of Virginia law. Cahill
Gordon & Reindel, New York, NY will issue an opinion for the agents or
underwriters. Cahill Gordon & Reindel will rely on the opinion of our lawyers as
to matters of Maryland law and the applicability of the Public Utility Holding
Company Act of 1935 and upon the opinion of Piper & Marbury L.L.P. as to matters
of Virginia law.
EXPERTS
Coopers & Lybrand, L.L.P., independent accountants, audited BGE's annual
financial statements and schedules incorporated by reference in this prospectus
and elsewhere in the registration statement and Price Waterhouse LLP audited
PEPCO's annual financial statements and schedules incorporated by reference in
this prospectus and elsewhere in the registration statement. These documents are
incorporated by reference in reliance upon the authority of Coopers & Lybrand
L.L.P. and Price Waterhouse LLP as experts in accounting and auditing in giving
their respective reports.
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GLOSSARY
Set forth below are definitions of some of the terms used in this
Prospectus.
"Business Day" means any day other than a Saturday or Sunday that (a) is
not a day on which banking institutions in Maryland, or in New York, New York,
are authorized or obligated by law or executive order to be closed, and (b) with
respect to LIBOR Notes only, is a day on which dealings in deposits in U.S.
dollars are transacted in the London interbank market ("London Business Day").
"Calculation Agent" means the entity chosen by the Company to perform
the duties related to interest rate calculation and resets for floating rate
notes.
"Calculation Date" means the date on which the Calculation Agent
calculates an interest rate for a floating rate note, which will be one of the
following:
"Prime Rate" - tenth day after the related Prime Rate Interest
Determination Date or, if such day is not a Business Day, the next
Business Day.
"CD Rate" - tenth day after the related CD Rate Interest
Determination Date or, if such day is not a Business Day, the next
Business Day.
"CMT Rate" - tenth day after the related CMT Rate Interest
Determination Date or, if such day is not a Business Day, the next
Business Day.
"Commercial Paper Rate" - tenth day after the related Commercial
Paper Rate Interest Determination Date or, if such day is not a
Business Day, the next Business Day.
"LIBOR" - the LIBOR Interest Determination Date.
"Treasury Rate" - tenth day after the related Treasury Rate
Interest Determination Date or, if such day is not a Business Day, the
next Business Day.
"Federal Funds Effective Rate" - tenth day after the related
Federal Funds Effective Rate Interest Determination Date or, if such
day is not a Business Day, the next Business Day.
"Composite Quotations" means the daily statistical release entitled
"Composite 3:30 P.M. Quotations for U.S. Government Securities," or any
successor publication, published by The Federal Reserve Bank of New York.
"Designated CMT Telerate Page" means the display on the Dow Jones
Telerate Service on the page designated in the applicable pricing supplement and
on the face of such CMT Rate Note (or any other page as may replace such page on
that service) for the purpose of displaying Treasury Constant Maturities as
reported in H.15(519).
"H.15(519)" means the weekly statistical release entitled "Statistical
Release H.15(519), Selected Interest Rates," or any successor publication,
published by the Board of Governors of the Federal Reserve System.
"Index Maturity" means, with respect to a floating rate note, the period
to maturity of the note on which the interest rate formula is based, as
indicated in the applicable pricing supplement.
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"Interest Determination Date" means the date as of which the interest
rate for a floating rate note is to be calculated, to be effective as of the
following Interest Reset Date and calculated on the related Calculation Date
(except in the case of LIBOR which is calculated on the related LIBOR Interest
Determination Date). The Interest Determination Dates will be indicated in the
applicable pricing supplement and in the note.
"Interest Reset Date" means the date on which a floating rate note will
begin to bear interest at the variable interest rate determined on any Interest
Determination Date. The Interest Reset Dates will be indicated in the applicable
pricing supplement and in the note.
"Money Market Yield" is the yield (expressed as a percentage rounded
upwards, if necessary, to the next higher one-hundred thousandth of a percentage
point) calculated in accordance with the following formula:
D X 360
Money Market Yield = ___________________ X 100
360 - (D X M)
where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the actual number
of days in the period for which interest is being calculated.
"Reuters Screen LIBO Page" means the display designated as page "LIBO"
on the Reuters Monitor Money Rates Service (or such other page as may replace
the LIBO page on that service for the purpose of displaying London interbank
offered rates of major banks).
"Reuters Screen USPRIMEONE Page" means the display designated as page
"USPRIMEONE" on the Reuters Monitor Money Rates Service (or such other page as
may replace the USPRIMEONE page on that service for the purpose of displaying
prime rates or base lending rates of major United States banks).
"Spread" means the number of basis points specified in the applicable
pricing supplement as being applicable to the interest rate for a floating rate
note.
"Spread Multiplier" means the percentage specified in the applicable
pricing supplement as being applicable to the interest rate for a floating rate
note.
"Telerate Page 3750" means the display designated as page "3750" on the
Telerate Service (or such other page as may replace the 3750 page on that
service or such other service or services as may be nominated by the British
Bankers Association for the purpose of displaying London interbank offered rates
for U.S. dollar deposits).
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Table of Contents
Page
PROSPECTUS SUMMARY.............................. 2
WHERE YOU CAN FIND MORE INFORMATION............. 3
CONSTELLATION ENERGY............................ 3
PRICING SUPPLEMENT.............................. 4
USE OF PROCEEDS................................. 4
RATIO OF EARNINGS TO FIXED CHARGES.............. 4
DESCRIPTION OF THE NOTES........................ 5
General. ................................... 5
Redemptions................................. 5
Repurchases................................. 5
Remarketed Notes............................ 5
Book-Entry Notes - Registration, Transfer,
and Payment of Interest and Principal...... 5
Book-Entry Notes- Method of Repurchase...... 7
Certificate Notes- Registration, Transfer
and Payment of Interest and Principal..... 7
Certificate Notes- Method of Repurchase..... 7
Interest Rate............................... 7
General................................. 7
Fixed Rate Notes........................ 8
Floating Rate Notes..................... 8
General.............................. 8
Date of Interest Rate Change......... 8
When Interest Rate Is Determined..... 9
When Interest Is Paid................ 9
Commercial Paper Rate Notes.......... 10
Prime Rate Notes..................... 10
CD Rate Notes........................ 11
Federal Funds Effective Rate.Notes... 12
LIBOR Notes.......................... 12
Treasury Rate Notes.................. 13
CMT Rate Notes....................... 14
Event of Default............................ 15
Modification of Indenture.................... 16
Consolidation, Merger or Sale............... 16
PLAN OF DISTRIBUTION............................ 16
LEGAL OPINIONS.................................. 17
EXPERTS......................................... 17
GLOSSARY........................................ 18
[GRAPHIC OMITTED]
$300,000,000
Medium-Term Notes
Series F
- --------------------------------------------------------------------------------
PROSPECTUS
- --------------------------------------------------------------------------------
LEHMAN BROTHERS
GOLDMAN, SACHS & CO.
MERRILL LYNCH & CO.
__________________ , 1997
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Securities and Exchange Commission Registration Fee...... $ 90,910
Services of Independent Accountants...................... 65,000*
Trustee Fees and Expenses................................ 15,000*
Legal Fees and Expenses.................................. 35,000*
Debt Securities Rating Fees.............................. 107,000*
Printing and Delivery Expenses........................... 20,000*
Miscellaneous Expenses................................... 17,090*
---------
Total $350,000*
---------
-------------
* Estimated
Item 15. Indemnification of Directors and Officers.
Article Seventh of the Corporation's Charter and Article VI of the
Corporation's By-laws provide that to the fullest extent permitted by applicable
statutory or decisional law, as amended or interpreted, no director or officer
of the Corporation will be personally liable to the Corporation or its
shareholders for monetary damages.
Under Section 2-418 of the Maryland General Corporation Law ("MGCL"), a
Maryland corporation may indemnify any director who was or is a party or is
threatened to be made a party to any threatened, pending, or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
("Proceeding") by reason of the fact that he is a present or former director of
the corporation and any person who, while a director of the corporation, is or
was serving at the request of the corporation as a director, officer, partner,
trustee, employee, or agent of another corporation, partnership, joint venture,
trust, other enterprise, or employee benefit plan ("Director"). Under Section
2-418(b)(1)(i)-(iii), a corporation may indemnify any director made a party to
any proceeding by reason of service in that capacity, unless it is established
that: (i) the act or omission of the director was material to the matter giving
rise to the proceeding and (1) was committed in bad faith; or (2) was the result
of active and deliberate dishonesty; (ii) the director actually received an
improper personal benefit in money, property, or services; or (iii) in the case
of any criminal proceeding, the director had reasonable cause to believe that
the act or omission was unlawful.
A Maryland corporation may not indemnify any Director in connection with a
Proceeding by or in the right of the corporation if the Director has been
adjudged to be liable to the corporation. A Director or officer who has been
successful in the defense of any Proceeding described above shall be
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indemnified against reasonable expenses incurred in connection with the
Proceeding. The corporation may not indemnify a Director in respect of any
Proceeding charging improper personal benefits to the Director in which the
Director was adjudged to be liable on the basis that personal benefit was
improperly received. Notwithstanding the above provisions, a court of
appropriate jurisdiction, upon application of the Director or officer, may order
indemnification if it determines that in view of all the relevant circumstances,
the Director or officer is fairly and reasonably entitled to indemnification;
however, indemnification with respect to any Proceeding by or in the right of
the corporation or in which liability was adjudged on the basis that personal
benefit was improperly received shall be limited to expenses. A corporation may
advance reasonable expenses to a Director under certain circumstances, including
a written undertaking by or on behalf of such Director to repay the amount if it
shall ultimately be determined that the standard of conduct necessary for
indemnification by the corporation has not been met. A corporation may indemnify
and advance expenses to an officer of the corporation to the same extent that it
may indemnify Directors under the statute. The indemnification and advancement
of expenses provided or authorized by this statute may not be deemed exclusive
of any other rights, by indemnification or otherwise, to which a Director or
officer may be entitled under the charter, by-laws, a resolution of shareholders
or directors, an agreement or otherwise.
Under Section 13.1-697 of the Virginia Stock Corporation Act ("VSCA"), a
Virginia corporation may indemnify a Director who was, is, or is threatened to
be made a party to any Proceeding if the Director acted in good faith and (i) he
believed, in the case of conduct in his official capacity with the corporation,
that his conduct was in the best interests of the corporation or, in the case of
other conduct, that his conduct was at least not opposed to the best interests
of the corporation, or (ii) in the case of a criminal proceeding, he had no
reasonable cause to believe his conduct was unlawful. A corporation may not
indemnify a Director in connection with (i) a Proceeding by or in the right of
the corporation in which the Director was found liable to the corporation or
(ii) any other proceeding charging improper personal benefit to him, whether or
not involving action in his official capacity, in which he was adjudged liable
on the basis that personal benefit was improperly received. Indemnification
permitted under this section of the VSCA in connection with a Proceeding by or
in the right of the corporation is limited to reasonable expenses incurred in
connection with the Proceeding.
Under Section 13.1-698, unless limited by its Articles of Incorporation, a
corporation must indemnify against reasonable expenses a Director who entirely
prevails in the defense of any Proceeding to which he was a party because he is
or was a Director of the corporation.
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Under Section 13.1-700.1, a court of appropriate jurisdiction, upon the
application of a Director, may order a corporation to advance or reimburse
expenses or provide indemnification if the court determines that the Director is
so entitled. With respect to a Proceeding by or in the right of the corporation,
a court may order indemnification of the Director to the extent of his
reasonable expenses even though he was adjudged liable to the corporation.
Under Section 13.1-699, a corporation may advance reasonable expenses to a
Director made a party to a Proceeding under certain circumstances, including the
furnishing by the Director of (i) a written statement of his good faith belief
that he has met the standard of conduct necessary to obtain indemnification and
(ii) a written undertaking to repay the advance if it is ultimately determined
that he did not meet that standard. Under Section 13.1-702, a corporation may
indemnify an officer, employee or agent of a corporation to the same extent as a
Director. Under Section 13.1-704, a corporation may provide indemnification in
addition to that provided by statute if authorized by its Articles of
Incorporation, a bylaw made by the shareholders, or any resolution adopted by
the shareholders, except indemnification against willful misconduct or a knowing
violation of the criminal law.
Pursuant to Section 7.5 of the merger agreement regarding the merger of
Baltimore Gas and Electric Company (BGE) and Potomac Electric Power Company
(PEPCO) into the Corporation, the Corporation will, to the fullest extent not
prohibited by applicable law, indemnify, defend and hold harmless the present
and former directors, officers and employees of each of the Corporation, BGE,
PEPCO, and their respective subsidiaries against (i) all losses, expenses
(including reasonable attorneys' fees and expenses), claims, damages, costs,
liabilities, judgments or amounts that are paid in settlement of or in
connection with any claim, action, suit, proceeding or investigation (a) based
in whole or in part on or arising in whole or in part out of the fact that such
person is or was a director, officer or employee of such party or any subsidiary
thereof, and (b) pertaining to any matter existing or occurring at or prior to
the effective time of the merger of BGE and PEPCO into the Corporation (the
"Effective Time"), whether asserted or claimed prior to, at or after the
Effective Time, and (ii) all losses, expenses (including reasonable attorney's
fees and expenses), claims, damages, costs, liabilities, judgments, or amounts
that are paid in settlement of or in connection with any claim, action, suit,
proceeding or investigation based in whole or in part on, or arising in whole or
in part out of, or pertaining to the merger agreement or the transactions
contemplated thereby.
Further, the Corporation will for a period of six years after the
Effective Time, cause to be maintained in effect the policies of directors' and
officers' liability insurance maintained by BGE and PEPCO; provided that the
Corporation may
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<PAGE>
substitute therefor policies of at least the same coverage containing terms that
are no less advantageous with respect to matters occurring prior to the
Effective Time to the extent such liability insurance can be maintained annually
at a cost to the Corporation not greater than 200% of the current aggregate
annual premiums for the policies currently maintained by BGE and PEPCO for their
directors' and officers' liability insurance; provided, further, that if such
insurance cannot be so maintained or obtained at such cost, the Corporation will
maintain or obtain as much of such insurance for each of BGE and PEPCO as can be
so maintained or obtained at a cost equal to 200% of the respective current
annual premiums of each of BGE and PEPCO for their directors' and officers'
liability insurance.
Item 16. Exhibits.
Reference is made to the Exhibit Index filed as a part of this
Registration Statement.
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;
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<PAGE>
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the Registration Statement is on Form S-3, Form S-8, or Form F-3
and the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Securities and Exchange Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to Directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a Director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such Director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Constellation
Energy Corporation, the Registrant, certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Baltimore, State of
Maryland on the 9th day of April, 1997.
CONSTELLATION ENERGY CORPORATION
(Registrant)
By: /s/ David A. Brune
-----------------------------
David A. Brune
Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
Principal executive
officer and director:
* Charles W. Shivery Chairman of the April 9, 1997
Board, Chief
Executive Officer
and Director
Principal financial
and accounting officer
and director:
/s/ David A. Brune Vice President April 9, 1997
- -------------------- and Secretary
David A. Brune
* Dennis R. Wraase Director April 9, 1997
* By: /s/ David A. Brune
--------------------
David A. Brune
Attorney-in-Fact
II-6
<PAGE>
EXHIBIT INDEX
Exhibit
Number
1(a) Form of Agency Agreement, including Administrative Procedures; and
Form of Purchase Agreement, including Standard Purchase Provisions.
1(b) Form of Interest Calculation Agency Agreement.
4(a) Indenture dated as of April 4, 1997 between the Corporation and The
Bank of New York.
4(b) Form of Medium-Term Note, Series F (Fixed Rate).
4(c) Form of Medium-Term Note, Series F (Floating Rate)
5(a) Opinion of Counsel of the Corporation as to the legality of the Notes.
5(b) Opinion of Piper & Marbury L.L.P. as to the legality of the Notes.
12 Proforma Computation of Ratio of Earnings to Fixed Charges
23(a) Consent of Counsel of the Corporation (included in Exhibit 5(a)).
23(b) Consent of Piper & Marbury L.L.P. (included in Exhibit 5(b)).
23(c) Consent of Coopers & Lybrand, L.L.P., Independent Accountants
23(d) Consent of Price Waterhouse, LLP, Independent Accountants
24 Power of Attorney.
25 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 (Form T-1) of The Bank of New York, Trustee.
99(a)* Corporations and Associations Article, Section 2- 418 of the Annotated
Code of Maryland (Designated as Exhibit 99(a) to the Form S-3 File No.
333- 24705 filed April 7, 1997).
99(b)* Article 10 of the Virginia Stock Corporations Act (Designated as
Exhibit 99(b) to the Form S-3 File No. 333- 24705 filed April 7,
1997).
- ------------------
* Incorporated by reference.
<PAGE>
Exhibit 1(a)
$300,000,000
CONSTELLATION ENERGY CORPORATION
MEDIUM-TERM NOTES
SERIES F
AGENCY AGREEMENT
__________, 1997
Lehman Brothers
Lehman Brothers Inc.
3 World Financial Center
12th Floor
New York, New York 10285-1200
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
250 Vesey Street
New York, New York 10281
Dear Sirs:
1. Introduction. Constellation Energy Corporation, a
Maryland and Virginia corporation (the "Corporation"), confirms
its agreement with Lehman Brothers, Lehman Brothers Inc.;
Goldman, Sachs & Co.; and Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated (individually, an "Agent" and
collectively, the "Agents") with respect to the issue and sale
from time to time by the Corporation of up to $300,000,000
aggregate principal amount of its Medium-Term Notes, Series F
registered under the registration statement referred to in
Section 2(a) (the "Notes"). The Notes will be issued under an
indenture, dated as of April 4, 1997 (the "Indenture"), between
the Corporation and The Bank of New York (the "Trustee").
The Notes shall have the maturity ranges (which shall be
from nine months to thirty years), annual interest rates,
redemption provisions and other terms set forth in the Prospectus
referred to in Section 2(a) as it may be supplemented from time
to time. The Notes will be issued, and the terms thereof
established, from time to time by the Corporation in accordance
with the Indenture, the Notes and the Procedures (as defined in
Section 3(d) hereof).
<PAGE>
2. Representations and Warranties of the Corporation. The
Corporation represents and warrants to, and agrees with, each
Agent as follows:
(a) A registration statement on Form S-3 (No. 333-_____),
covering $300 million principal amount of the Notes, including a
prospectus, has been filed with the Securities and Exchange
Commission ("Commission") and has become effective. Such
registration statement, including (i) the prospectus included
therein dated ____________ (such prospectus including each
document incorporated by reference therein, as may be amended or
supplemented from time to time, is hereinafter called the
"Prospectus") and (ii) all documents filed as part thereof or
incorporated by reference therein, as may be amended or
supplemented from time to time, are hereinafter called the
"Registration Statement." Any reference in this Agreement to
amending or supplementing the Prospectus shall be deemed to
include the filing of materials incorporated by reference in the
Prospectus after the Closing Date and any reference in this
Agreement to any amendment or supplement to the Prospectus shall
be deemed to include any such materials incorporated by reference
in the Prospectus after the Closing Date.
(b) The Registration Statement conforms in all respects to
the requirements of the Securities Act of 1933, as amended
("Act"), and the pertinent published rules and regulations of the
Commission thereunder ("33 Act Rules and Regulations") and the
Trust Indenture Act of 1939, as amended ("Trust Indenture Act"),
and does not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and on
the Closing Date, and at each of the times of (i) acceptance
referred to in Section 6(a) hereof, (ii) delivery referred to in
Section 6(e) hereof and (iii) amendment or supplement referred to
in Section 6(b) hereof (the Closing Date and each such time being
herein sometimes referred to as "Representation Date"), the
Registration Statement and the Prospectus will conform in all
respects to the requirements of the Act, the Trust Indenture Act
and the 33 Act Rules and Regulations and none of such documents
will contain an untrue statement of a material fact or will omit
to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except
that the foregoing does not apply to statements or omissions in
such document based upon written information furnished to the
Corporation by any Agent specifically for use therein. The
documents incorporated by reference in the Registration Statement
or the Prospectus pursuant to Item 12 of Form S-3 of the Act, at
the time they were filed with the Commission, complied in all
material respects with the requirements of the Securities
Exchange Act of 1934, as amended ("Exchange Act"), and the
pertinent published rules and regulations thereunder ("Exchange
Act Rules and Regulations"). Any additional documents deemed to
be incorporated by reference in the Prospectus will, when they
are filed with the Commission, comply in all material respects
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<PAGE>
with the requirements of the Exchange Act and the Exchange Act
Rules and Regulations and will not contain an untrue statement of
a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading.
3. Appointment as Agent; Solicitations as Agent.
(a) Subject to the terms and conditions stated herein, the
Corporation hereby appoints each of the Agents as an agent of the
Corporation for the purpose of soliciting or receiving offers to
purchase the Notes from the Corporation by others.
(b) On the basis of the representations and warranties
contained herein, but subject to the terms and conditions herein
set forth, each Agent agrees, as agent of the Corporation, to use
all reasonable efforts when requested by the Corporation to
solicit offers to purchase the Notes upon the terms and
conditions set forth in the Prospectus, as from time to time
amended or supplemented.
Upon receipt of notice from the Corporation as
contemplated by Section 4(b) hereof, each Agent shall suspend its
solicitation of purchases of Notes until such time as the
Corporation shall have furnished it with an amendment or
supplement to the Registration Statement or the Prospectus, as
the case may be, contemplated by Section 4(b) and shall have
advised each Agent that such solicitation may be resumed.
The Corporation reserves the right, in its sole
discretion, to suspend solicitation of offers to purchase the
Notes commencing at any time for any period of time or
permanently. Upon receipt of notice from the Corporation, the
Agents will use their best efforts promptly to suspend
solicitation of offers to purchase Notes from the Corporation,
but in no event later than one business day after notice, until
such time as the Corporation has advised the Agents that such
solicitation may be resumed. For the purpose of the foregoing
sentence, "business day" shall mean any day which is not a
Saturday or a Sunday or a day on which banking institutions in
The City of New York and the City of Baltimore are authorized or
required by law or executive order to be closed.
The Agents are authorized to solicit offers to purchase
Notes only in fully registered form, in minimum denominations of
$1,000 and integral multiples of $1,000 in excess thereof, and at
a purchase price which, unless otherwise specified in a
supplement to the Prospectus, shall be equal to 100% of the
principal amount thereof. Each Agent shall communicate to the
Corporation, orally or in writing, each reasonable offer to
purchase Notes received by it as Agent. The Corporation shall
have the sole right to accept offers to purchase the Notes and
may reject any such offer, in whole or in part. Each Agent shall
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<PAGE>
have the right, in its discretion reasonably exercised, without
notice to the Corporation, to reject any offer to purchase Notes
received by it, in whole or in part, and any such rejection shall
not be deemed a breach of its agreement contained herein.
No Note which the Corporation has agreed to sell pursuant
to this Agreement shall be deemed to have been purchased and paid
for, or sold, by the Corporation until such Note shall have been
delivered to the purchaser thereof against payment by such
purchaser.
(c) At the time of delivery of, and payment for, any Notes
sold by the Corporation as a result of a solicitation made by, or
offer to purchase received by, an Agent, the Corporation agrees
to pay such Agent a commission in accordance with the schedule
set forth in Exhibit A hereto.
(d) Administrative procedures respecting the sale of Notes
(the "Procedures") shall be agreed upon from time to time by the
Agents and the Corporation. The initial Procedures, which are
set forth in Exhibit B hereto, shall remain in effect until
changed by agreement among the Corporation and the Agents. Each
Agent and the Corporation agree to perform the respective duties
and obligations specifically provided to be performed by each of
them herein and in the Procedures. The Corporation will furnish
a copy of the Procedures as from time to time in effect to the
Trustee which will act as the authenticating agent and the agent
for payment, registration and notice with respect to the Notes
pursuant to the Indenture and the agent for calculating interest
rates with respect to floating rate notes pursuant to the
Interest Calculation Agency Agreement dated as of ________ (the
"Interest Calculation Agency Agreement").
(e) The documents required to be delivered by Section 5
hereof shall be delivered at the offices of the Corporation, 39
W. Lexington Street, Baltimore, Maryland, 21201, not later than
5:00 P.M., Baltimore time, on the date of this Agreement or at
such later time as may be mutually agreed by the Corporation and
the Agents, which in no event shall be later than the time at
which the Agents commence solicitation of purchases of Notes
hereunder, such time and date being herein called the "Closing
Date."
4. Certain Agreements of the Corporation. The Corporation
agrees with the Agents that it will furnish to Cahill Gordon &
Reindel, counsel for the Agents, one signed copy of the
Registration Statement, including all exhibits and all documents
incorporated by reference, in the form it became effective and of
all amendments thereto and that, in connection with each offering
of Notes, it will take the following actions:
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<PAGE>
(a) From the time solicitation regarding sale of the Notes
is begun until all of the Notes have been sold (i) the
Corporation will advise each Agent promptly of any proposal to
amend or supplement the Registration Statement or the Prospectus
by means of a post-effective amendment, sticker, or supplement
(except post-effective amendments, supplements, and stickers
relating solely to interest rates or maturities of Notes) but not
by means of incorporation of document(s) by reference into the
Registration Statement or the Prospectus; (ii) the Corporation
will afford the Agents a reasonable opportunity to comment on any
such proposed post-effective amendment, sticker, or supplement;
(iii) the Corporation will advise each Agent of the filing of any
such post-effective amendment, sticker, or supplement; and (iv)
the Corporation will (x) advise each Agent of the institution by
the Commission of any stop order proceedings in respect of the
Registration Statement or of any part thereof, (y) use its best
efforts to prevent the issuance of any such stop order, and (z)
if a stop order is issued, to obtain its lifting as soon as
possible.
(b) If from the time solicitation regarding sale of the
Notes is begun until all of the Notes have been sold, the
Corporation shall determine that it is necessary to suspend
solicitation of the Notes because of the occurrence of an event
that results in the Prospectus either (x) including an untrue
statement of a material fact or omitting to state any material
fact necessary to make the statements in such Prospectus, in
light of the circumstances under which they were made when such
Prospectus was delivered, not misleading, or (y) failing to
comply with the Act, then the Corporation will promptly notify
each Agent to suspend solicitation of purchases of the Notes.
Notwithstanding Section 4(a) if the Corporation shall determine
to amend or supplement the Registration Statement or Prospectus
to correct such result, it will advise each Agent promptly and
afford the Agents a reasonable opportunity to discuss and comment
upon the nature of the disclosure in such amendment or
supplement. Notwithstanding the foregoing, if at the time of any
notification to suspend solicitations (i) this Agreement shall be
in effect and any Agent shall own any of the Notes with the
intention of reselling them, or (ii) the Corporation has accepted
an offer to purchase Notes but the related settlement has not
occurred, then the Corporation, subject to the provisions of
Section 4(a) of this Agreement, will promptly prepare and file
with the Commission an amendment or supplement which will correct
such statement or omission or effect such compliance.
(c) The Corporation, during the period when a prospectus
relating to the Notes is required to be delivered under the Act,
will furnish to each Agent promptly after timely filing with the
Commission all documents required to be filed pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (except
those filings associated with employee benefit plans). The
Corporation will immediately notify each Agent of any downgrading
in the rating of the Notes or any other debt securities of the
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<PAGE>
Corporation, or any proposal to downgrade the rating of the Notes
or any other debt securities of the Corporation, by any
"nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act), as soon as
the Corporation learns of such downgrading or proposal to
downgrade.
(d) The Corporation will furnish to each Agent copies of
the Registration Statement, including all exhibits except those
incorporated by reference, any related preliminary prospectus,
any related preliminary prospectus supplement, the Prospectus and
all amendments and supplements to such documents, in each case as
soon as available and in such quantities as are reasonably
requested.
(e) The Corporation will use its best efforts to obtain
the qualification of the Notes for sale and the determination of
their eligibility for investment under the laws of such
jurisdictions as the Agents designate and will continue such
qualifications in effect so long as required for the
distribution; provided, however, that the Corporation shall not
be required to qualify as a foreign corporation or to file any
consent to service of process under the laws of any jurisdiction
or to comply with any other requirements deemed by the
Corporation to be unduly burdensome.
(f) So long as any Notes are outstanding, the Corporation
will furnish to the Agents: (i) as soon as practicable after the
end of each fiscal year, a copy of its annual report to
shareholders for such year, (ii) as soon as available, a copy of
each report or definitive proxy statement of the Corporation
filed with the Commission under the Exchange Act or mailed to
shareholders, and (iii) from time to time, such other information
concerning the Corporation as you may reasonably request.
(g) The Corporation will pay all expenses incident to the
performance of its obligations under this Agreement, and will
reimburse each Agent for any expenses (including Blue Sky fees
and disbursements of counsel which will not in the aggregate
exceed $6,000) incurred by it in connection with qualification of
the Notes for sale and determination of their eligibility for
investment under the laws of such jurisdictions as such Agent may
designate and the printing of memoranda relating thereto, for any
filing fees charged by investment rating agencies for the rating
of the Notes, for any filing fee of the National Association of
Securities Dealers, Inc. relating to the Notes, and for the
reasonable fees and disbursements of counsel to the Agents.
(h) Not later than 45 days after the end of the 12-month
period beginning at the end of any fiscal quarter of the
Corporation in which the Closing Date or any other Representation
Date occurs, the Corporation will make generally available to its
security holders an earnings statement (which need not be
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<PAGE>
audited) covering such 12-month period which will satisfy the
provisions of Section 11(a) of the Act.
5. Conditions of Obligations of Agents. The obligation of
each Agent under this Agreement at any time to solicit offers to
purchase the Notes is subject to the accuracy of the
representations and warranties of the Corporation herein on the
date hereof, on each Representation Date and on the date of each
such solicitation, to the accuracy of the statements of the
Corporation's officers made pursuant to the provisions hereof on
each such date, to the performance by the Corporation of its
obligations hereunder on or prior to each such date, and to each
of the following additional conditions precedent:
(a) No stop order suspending the effectiveness of the
Registration Statement or of any part thereof shall have been
issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Corporation or any Agent,
shall be contemplated by the Commission.
(b) Neither the Registration Statement nor the Prospectus,
as amended or supplemented as of any Representation Date or date
of such solicitation, as the case may be, shall contain any
untrue statement of fact which, in the opinion of any Agent, is
material or omits to state a fact which, in the opinion of such
Agent, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(c) There shall not have occurred (i) any suspension or
limitation of trading in securities generally on the New York
Stock Exchange other than a temporary suspension in trading to
provide for an orderly market, or any setting of minimum prices
for trading on such exchange, or any suspension of trading of any
securities of the Corporation on any exchange or in the over-the-
counter market; (ii) any banking moratorium declared by Federal
or New York authorities; or (iii) any outbreak or escalation of
major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national
or international calamity or emergency if, in the reasonable
judgment of such Agents, the effect of any such outbreak,
escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with solicitations of
purchases of, or sales of, Notes.
(d) At the Closing Date, the Agents shall have received an
opinion, dated the Closing Date, of counsel of the Corporation,
(relying on Piper and Marbury as to Virginia law)to the effect
that:
(i) The Corporation has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of Maryland and the Commonwealth of
Virginia, with power and authority (corporate and other)
to own its respective properties and conduct its
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<PAGE>
respective businesses as described in the Prospectus; and
the Corporation is duly qualified to do business as a
foreign corporation in good standing in the Commonwealth
of Pennsylvania, the District of Columbia and all other
jurisdictions in which the conduct of its business or the
ownership of its properties requires such qualification
and the failure to do so would have a material and adverse
impact on its financial condition;
(ii) The Indenture has been duly authorized, executed
and delivered by the Corporation, and is a valid
instrument, legally binding on the Corporation,
enforceable in accordance with its terms, except as
limited by bankruptcy, insolvency, or other laws affecting
the enforcement of creditors' rights and by general
principles of equity;
(iii) The issuance and sale of Notes have been duly
authorized by all necessary corporate action of the
Corporation. The Notes (assuming that they have been duly
authenticated by the Trustee or a duly designated
Authentication Agent under the Indenture, which fact
counsel need not verify by an inspection of the Notes),
when issued in accordance with the provisions of this
Agreement and the Indenture, will be duly issued and
constitute legal, valid and binding obligations of the
Corporation enforceable in accordance with their terms and
are entitled to the benefits provided by the Indenture,
except as limited by bankruptcy, insolvency or other laws
affecting the enforcement of creditors' rights and by
general principles of equity;
(iv) The Registration Statement has become effective
under the Act and (a) to the best of such counsel's
knowledge, no stop order suspending the effectiveness of
the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are
pending or contemplated under the Act; (b) the
Registration Statement (as of its effective date) and the
Prospectus (as of the date of this Agreement) appeared to
comply as to form in all material respects with the
requirements of Form S-3 under the Act and the 33 Act
Rules and Regulations and the Trust Indenture Act; (c)
such counsel has no reason to believe that either the
Registration Statement as of its effective date or the
Prospectus as of the date of this Agreement contained any
untrue statement of a material fact or omitted to state
any material fact required to be stated therein or
necessary to make the statements therein not misleading;
(d) the descriptions in the Registration Statement and
Prospectus of statutes, legal and governmental proceedings
and contracts and other documents are accurate and fairly
present the information required to be shown; and (e) such
counsel does not know of any legal or governmental
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<PAGE>
proceedings required to be described in the Prospectus
which are not described as required, nor of any contracts
or documents of a character required to be described in
the Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not
described or filed as required; it being understood that
such counsel, in addressing the matters covered in this
paragraph (iv), need express no opinion as to the
financial statements or other financial and statistical
information contained in the Registration Statement or the
Prospectus or incorporated therein or attached as an
exhibit thereto or as to the Statement of Eligibility and
Qualification on Form T-1 of the Trustee under the
Indenture;
(v) The approvals of the Public Service Commission of
Maryland and the Public Service Commission of the District
of Columbia necessary for the valid issuance by the
Corporation of Notes pursuant to this Agreement have been
obtained and continues in full force and effect. The
Corporation has received the approval of the Federal
Energy Regulatory Commission ("FERC") for the issuance of
Notes on or before December 31, 1998 with maturities of
not more than 12 months after the date of issuance and the
approval of FERC will be required for the issuance of any
Notes having such maturities after December 31, 1998.
Such counsel knows of no other approval of any other
regulatory authority which is legally required for the
valid offering, issuance, sale and delivery of the Notes
by the Corporation under this Agreement (except that such
opinion need not pass upon the requirements of state
securities acts);
(vi) To the best of such counsel's knowledge and
belief, the consummation of the transactions contemplated
in this Agreement and the compliance by the Corporation
with all the terms of the Indenture did not and will not
result in a breach of any of the terms or provisions of,
or constitute a default under, the Corporation's Charter
or By-Laws or any indenture, mortgage or deed of trust or
other agreement or instrument to which the Corporation is
a party;
(vii) Each of this Agreement, the Interest Calculation
Agency Agreement and the Letter of Representations has
been duly authorized, executed and delivered by the
Corporation;
(viii) The Indenture is duly qualified under the Trust
Indenture Act;
(ix) The issuance, sale and delivery of the Notes as
contemplated by this Agreement are not subject to the
approval of the Commission under the provisions of the
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<PAGE>
Public Utility Holding Company Act of 1935, as amended
(the "1935 Act"); and
(x) The Notes and Indenture conform as to legal
matters with the statements concerning them in the
Registration Statement and Prospectus under the caption
"DESCRIPTION OF NOTES" and on the cover page of the
Prospectus.
(e) At the Closing Date, the Agents shall have received a
certificate, dated the Closing Date, of the Chairman of the
Board, Chief Executive Officer, Vice Chairman, President, any
Vice President or the Treasurer and a principal financial or
accounting officer of the Corporation in which such officers, to
the best of their knowledge after reasonable investigation and
relying upon opinions of counsel to the extent legal matters are
involved, shall state that (i) the representations and warranties
of the Corporation in this Agreement are true and correct in all
material respects, (ii) the Corporation has complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date,
(iii) no stop order suspending the effectiveness of the
Registration Statement or of any part thereof has been issued and
no proceedings for that purpose have been instituted or are
contemplated by the Commission, and (iv) subsequent to the date
of the most recent financial statements set forth or incorporated
by reference in the Prospectus, there has been no material
adverse change in the financial position or in the financial
results of operations of the Corporation, except as set forth or
contemplated in the Prospectus or as described in such
certificate.
(f) At the Closing Date, the Agents shall have received
letters, dated the Closing Date, of Coopers & Lybrand related to
Baltimore Gas and Electric Company and Price Waterhouse related
to Potomac Electric Power Company, confirming that they are
independent public accountants within the meaning of the Act and
the 33 Act Rules and Regulations, and stating in effect that for
the respective companies that:
(i) In their opinion, the consolidated financial
statements and supporting schedules audited by them which
are included in the company's Form 10-K ("Form 10-K"),
which is incorporated by reference in the Registration
Statement comply in form in all material respects with the
applicable accounting requirements of the Act and the 33
Act Rules and Regulations and the Exchange Act and the
Exchange Act Rules and Regulations;
(ii) On the basis of procedures specified in such
letter (but not an audit in accordance with generally
accepted auditing standards), including reading the
minutes of meetings of the shareholders, the Board of
Directors and the Executive Committee of the company since
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<PAGE>
the end of the year covered by the Form 10-K as set forth
in the minute books through a specified date not more than
five days prior to the Closing Date, performing the
procedures specified in Statement on Auditing Standards
No. 71, Interim Financial Information, on the unaudited
interim consolidated financial statements of the company
incorporated by reference in the Registration Statement,
if any, and reading the latest available unaudited interim
consolidated financial statements of the company, and
making inquiries of certain officials of the company who
have responsibility for financial and accounting matters
as to whether the latest available financial statements
not incorporated by reference in the Registration
Statement are prepared on a basis substantially consistent
with that of the audited consolidated financial statements
incorporated in the Registration Statement, nothing has
come to their attention that has caused them to believe
that (1) any unaudited consolidated financial statements
incorporated by reference in the Registration Statement do
not comply in form in all material respects with the
applicable requirements of the Act and the 33 Act Rules
and Regulations and the Exchange Act and the Exchange Act
Rules and Regulations or any material modifications should
be made to those unaudited consolidated financial
statements for them to be in conformity with generally
accepted accounting principles; (2) at the date of the
latest available balance sheet not incorporated by
reference in the Registration Statement there was any
change in the capital stock, change in long-term debt or
decrease in consolidated net assets or common
shareholders' equity as compared with the amounts shown in
the latest balance sheet incorporated by reference in the
Registration Statement or for the period from the closing
date of the latest income statement incorporated by
reference in the Registration Statement to the closing
date of the latest available income statement read by them
there were any decreases, as compared with the
corresponding period of the previous year, in operating
revenues, operating income, net income, the ratio of
earnings to fixed charges (measured on the most recent
twelve month period), or in earnings per share of common
stock except in all instances of changes or decreases that
the Registration Statement discloses have occurred or may
occur, or which are described in such letter; or (3) at a
specified date not more than five days prior to the
Closing Date, there was any change in the capital stock or
long-term debt of the company or, at such date, there was
any decrease in net assets of the company as compared with
amounts shown in the latest balance sheet incorporated by
reference in the Registration Statement, or for the period
from the closing date of the latest income statement
incorporated by reference in the Registration Statement to
a specified date not more than five days prior to the
Closing Date, there were any decreases as compared with
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<PAGE>
the corresponding period of the previous year, in
operating revenues, operating income, net income or in
earnings applicable to common stock, except in all cases
for instances of changes or decreases that the
Registration Statement discloses have occurred or may
occur, or which are described in such letter; and
(iii) Certain specified procedures have been applied
to certain financial or other statistical information (to
the extent such information was obtained from the general
accounting records of the company) set forth or
incorporated by reference in the Registration Statement
and that such procedures have not revealed any
disagreement between the financial and statistical
information so set forth or incorporated and the
underlying general accounting records of the company,
except as described in such letter.
(g) The Agents shall have received from Cahill Gordon &
Reindel, counsel for the Agents, an opinion dated the Closing
Date, with respect to the matters referred to in paragraph 5(d)
subheadings (ii), (iii), (iv)b, (v), (vii), (viii) and (x) and
such other related matters as you may require and the Corporation
shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass on such matters.
In rendering such opinion, Cahill Gordon & Reindel may
rely, as to the incorporation of the Corporation, the approval of
the Public Service Commission of Maryland and the Public Service
Commission of the District of Columbia required for the issuance,
sale and delivery of the Notes, and all other matters governed
by the laws of the State of Maryland and the Commonwealth of
Virginia, the applicability of the 1935 Act and the approval of
FERC for the issuance, sale and delivery of the Notes, upon the
opinion of counsel for the Corporation referred to above.
In addition, such counsel shall state that such counsel
has participated in conferences with officers, counsel and other
representatives of the Corporation, representatives of the
independent certified public accountants for the Corporation and
representatives of the Agents at which the contents of the
Registration Statement and the Prospectus and related matters
were discussed; and, although such counsel is not passing upon
and does not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration
Statement and Prospectus (except as to the matters referred to in
their opinion rendered pursuant to subheading (x) above), on the
basis of the foregoing (relying as to materiality to a large
extent upon the opinions of officers, counsel and other
representatives of the Corporation), no facts have come to the
attention of such counsel which lead such counsel to believe that
either the Registration Statement (as of its effective date) or
the Prospectus (as of the date of this Agreement), contained an
untrue statement of a material fact or omitted to state a
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<PAGE>
material fact required to be stated therein or necessary to make
such statements therein not misleading (it being understood that
such counsel need make no comment with respect to the financial
statements and other financial and statistical information
included in the Registration Statement or Prospectus or
incorporated therein or as to the Statement of Eligibility and
Qualification on Form T-l of the Trustee under the Indenture).
(h) The approvals of the Public Service Commission of
Maryland and the Public Service Commission of the District of
Columbia necessary for the valid issuance of Notes by the
Corporation pursuant to this Agreement have been obtained and
continue in full force and effect. The Corporation has received
the approval of FERC for the issuance of Notes on or before
December 31, 1998 with maturities of not more than 12 months
after the date of issuance and the approval of FERC will be
obtained before the issuance of any Notes after December 31, 1998
having such maturities.
The Corporation will furnish the Agents with such
conformed copies of such opinions, certificates, letters and
documents as the Agents reasonably request.
6. Additional Covenants of the Corporation. The Corporation
agrees that:
(a) Each acceptance by the Corporation of an offer for the
purchase of Notes shall be deemed to be an affirmation that its
representations and warranties contained in this Agreement are
true and correct at the time of such acceptance, it being
understood that such representations and warranties shall relate
to the Registration Statement and the Prospectus as amended or
supplemented at each such time. Each such acceptance by the
Corporation of an offer for the purchase of Notes shall be deemed
to constitute an additional representation, warranty and
agreement by the Corporation that, as of the settlement date for
the sale of such Notes, after giving effect to the issuance of
such Notes and of any other Notes to be issued on or prior to
such settlement date, the aggregate amount of Notes which have
been issued and sold by the Corporation will not exceed the
amount of Notes registered pursuant to the Registration
Statement.
(b) From the time solicitation regarding the sale of the
Notes is begun until all of the Notes have been sold, each time
the Corporation (i) amends or supplements the Registration
Statement or the Prospectus (other than in reference solely to
interest rates or maturities of Notes) by means of a post-
effective amendment, sticker, or supplement but not by means of
incorporation of document(s) by reference into the Registration
Statement or the Prospectus; (ii) files an annual report on Form
10-K under the Exchange Act; (iii) files its quarterly reports on
Form 10-Q under the Exchange Act; and (iv) files a report on Form
8-K under the Exchange Act (the date of filing each of the
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<PAGE>
aforementioned documents is referred to as a "Representation
Date"); the Corporation shall furnish the Agents (but in the case
of (iv) above only if requested by the Agents) with a certificate
of the Chairman, Chief Executive Officer, Vice Chairman,
President, any Vice President or the Treasurer and a principal
financial or accounting officer of the Corporation, in form
satisfactory to the Agents, to the effect that on the
Representation Date, to the best of their knowledge after
reasonable investigation and relying upon opinions of counsel to
the extent legal matters are involved, (i) the representations
and warranties of the Corporation in this Agreement are true and
correct in all material respects; (ii) the Corporation has
complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the
Representation Date; (iii) no stop order suspending the
effectiveness of the Registration Statement or of any part
thereof has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission; and (iv)
subsequent to the date of the most recent financial statements
set forth or incorporated by reference in the Prospectus, there
has been no material adverse change in the financial position or
in the financial results of operations of the Corporation, except
as set forth in or contemplated by the Prospectus or as described
in such certificate.
(c) From the time solicitation regarding the sale of the
Notes is begun until all of the Notes have been sold, at each
Representation Date referred to in Section 6(b) (i) or (ii) and,
only if requested by the Agents, at each Representation Date
referred to in Section 6(b) (iii) or (iv), the Corporation shall
concurrently furnish the Agents with a written opinion or
opinions of counsel for the Corporation, dated the Representation
Date or the date of such filing, in form satisfactory to the
Agents, to the effect set forth in Section 5(d) hereof, but
modified, as necessary, to relate to the Registration Statement
and the Prospectus as then amended or supplemented; provided,
however, that in lieu of such opinion, counsel may furnish the
Agents with a letter to the effect that the Agents may rely on a
prior opinion delivered under Section 5(d) or this Section 6(c)
to the same extent as if it were dated the date of such letter
(except that statements in such prior opinion shall be deemed to
relate to the Registration Statement and the Prospectus as
amended or supplemented at such Representation Date).
(d) From the time solicitation regarding the sale of the
Notes is begun until all of the Notes have been sold, at each
Representation Date referred to in Section 6(b) (i) or (ii) and,
only if requested by the Agents, at each Representation Date
referred to in Section 6(b) (iii) or (iv), but in each case only
if such documents referred to in Section 6(b) include additional
financial information, the Corporation shall cause Coopers &
Lybrand and Price Waterhouse each concurrently to furnish the
Agents with a letter, addressed jointly to the Corporation and
the Agents and dated the Representation Date or the date of such
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<PAGE>
filing, in form and substance satisfactory to the Agents, to the
effect set forth in Section 5(f) hereof but modified to relate to
the Registration Statement and the Prospectus as amended or
supplemented at such Representation Date, with such changes as
may be necessary to reflect changes in the financial statements
and other information derived from the accounting records of the
Corporation; provided, however, that if the Registration
Statement or the Prospectus is amended or supplemented solely to
include financial information as of and for a fiscal quarter,
Coopers & Lybrand and Price Waterhouse may limit the scope of
such letters to the unaudited financial statements included in
such amendment or supplement unless there is contained therein
any other accounting, financial or statistical information that,
in the reasonable judgment of the Agents, should be covered by
such letters, in which event such letters shall also cover such
other information and procedures as shall be agreed upon by the
Agents.
(e) On each settlement date for the sale of Notes, the
Corporation shall, if requested by an Agent that solicited or
received the offer to purchase any Notes being delivered on such
settlement date, furnish such Agent with a written opinion of the
General Counsel or an Associate General Counsel of the
Corporation, dated the date of delivery thereof, in form
satisfactory to such Agent, to the effect set forth in clauses
(i), (ii), (iii) and (v) of Section 5(d) hereof, but modified, as
necessary, to relate to the Prospectus as amended or supplemented
at such settlement date and except that such opinion shall state
that the Notes being sold by the Corporation on such settlement
date, when delivered against payment therefor as provided in the
Indenture and this Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Corporation enforceable in
accordance with their terms, subject only to the exceptions as to
enforcement set forth in clauses (ii) and (iii) of Section 5(d)
hereof, and conform to the description thereof contained in the
Prospectus as amended or supplemented at such settlement date.
(f) The Corporation agrees that any obligation of a person
who has agreed to purchase Notes to make payment for and take
delivery of such Notes shall be subject to (i) the accuracy, on
the related settlement date fixed pursuant to the Procedures, of
the Corporation's representations and warranties deemed to be
made to the Agents pursuant to Section 2 and the last sentence of
subsection (a) of this Section 6; (ii) the satisfaction, on such
settlement date, of each of the conditions set forth in Sections
5(a), (b), (c) and (h), it being understood that under no
circumstance shall any Agent have any duty or obligation to
exercise the judgment permitted under Section 5(b) or (c) on
behalf of any such person; (iii) the absence of any change or
development involving a prospective change, not contemplated by
the Prospectus, in or affecting particularly the business or
properties of the Corporation which materially impairs the
investment quality of the Notes; and (iv) no downgrading in the
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<PAGE>
rating of the Corporation's debt securities by any "nationally
recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act).
7. Indemnification and Contribution.
(a) The Corporation will indemnify and hold harmless each
Agent and each person if any, who controls any Agent within the
meaning of the Act or the Exchange Act against any losses,
claims, damages or liabilities, joint or several, to which such
Agent or such controlling person may become subject, under the
Act, or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of
any material fact contained in the Registration Statement or the
Prospectus, or any related preliminary prospectus or arise out of
or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; and will
reimburse each Agent and each such controlling person for any
legal or other expenses reasonably incurred by such Agent or such
controlling person in connection with investigating or defending
any such loss, claim, damage, liability or action; provided,
however, that the Corporation will not be liable to such Agent or
controlling person in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon
an untrue statement or alleged untrue statement or omission or
alleged omission made in any such documents in reliance upon and
in conformity with written information furnished to the
Corporation by such Agent or such controlling person specifically
for use therein unless such loss, claim, damage or liability
arises out of the offer or sale of Notes occurring after such
Agent or controlling person has notified the Corporation in
writing that such information should no longer be used therein.
This indemnity agreement will be in addition to any liability
which the Corporation may otherwise have.
(b) Each Agent will indemnify and hold harmless the
Corporation, each of its directors, each of its officers who have
signed the Registration Statement and each person, if any, who
controls the Corporation within the meaning of the Act or the
Exchange Act, against any losses, claims, damages or liabilities
to which the Corporation or any such director, officer or
controlling person may become subject, under the Act, or
otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement or the Prospectus,
or any related preliminary prospectus or arise out of or are
based upon the omission or the alleged omission to state therein
a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or
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<PAGE>
alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information
furnished to the Corporation by such Agent specifically for use
therein; and will reimburse any legal or other expenses
reasonably incurred by the Corporation or any such director,
officer or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that such Agent
will not be liable to the Corporation or any such director,
officer or controlling person in any such case to the extent that
any such loss, claim, damage or liability arises out of the offer
or sale of Notes occurring after such Agent has notified the
Corporation in writing that such information should no longer be
used therein. This indemnity agreement will be in addition to
any liability which such Agent may otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under (a) and (b) above,
notify the indemnifying party of the commencement thereof; but
the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party
otherwise than under this Section. In case any such action is
brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent
that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who may, with the consent
of the indemnified party, be counsel to the indemnifying party)
and who shall not be counsel to any other indemnified party who
may have interests conflicting with those of such indemnified
party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs
of investigation.
(d) If recovery is not available under the foregoing
indemnification provisions of this Section for any reason other
than as specified therein, the parties entitled to
indemnification by the terms thereof shall be entitled to
contribution to liabilities and expenses, except to the extent
that contribution is not permitted under Section ll(f) of the
Act. In determining the amount of contribution to which the
respective parties are entitled, there shall be considered the
relative benefits received by each party from the offering of the
Notes (taking into account the portion of the proceeds of the
offering realized by each), the parties' relative knowledge and
access to information concerning the matter with respect to which
the claim was asserted, the opportunity to correct and prevent
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<PAGE>
any statement or omission, and any other equitable considerations
appropriate under the circumstances. The Corporation and the
Agents and such controlling persons agree that it would not be
equitable if the amount of such contribution were determined by
pro rata or per capita allocation (even if the Agents and such
controlling persons were treated as one entity for such purpose).
Notwithstanding the provisions of this subsection (d), no Agent
or controlling person shall be required to make contribution
hereunder which in the aggregate exceeds the total public
offering price of the Notes, distributed to the public through it
pursuant to this Agreement or upon resale of Notes purchased by
it from the Corporation, less the aggregate amount of any damages
which such Agent or such controlling person has otherwise been
required to pay in respect to the same claim or substantially
similar claim. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The obligations of each Agent
and each controlling person in this subsection (d) to contribute
are several, in the same proportion which the amount of the Notes
which are the subject of the action and which were distributed to
the public through such Agent or such controlling person pursuant
to this Agreement bears to the total amount of such Notes
distributed to the public through any other Agent or controlling
person pursuant to this Agreement, and not joint.
8. Status of Each Agent. In soliciting offers to purchase
the Notes from the Corporation pursuant to this Agreement and in
assuming its other obligations hereunder (other than offers to
purchase pursuant to Section 11), each Agent is acting
individually and not jointly and is acting solely as agent for
the Corporation and not as principal. Each Agent will use all
reasonable efforts to assist the Corporation in obtaining
performance by each purchaser whose offer to purchase Notes from
the Corporation has been solicited by such Agent and accepted by
the Corporation, but such Agent shall have no liability to the
Corporation in the event any such purchase is not consummated for
any reason. If the Corporation shall default on its obligations
to deliver Notes to a purchaser whose offer it has accepted, the
Corporation (i) shall hold the Agents harmless against any loss,
claim or damage arising from or as a result of such default by
the Corporation, and (ii), in particular, shall pay to the Agents
any commission to which they would be entitled in connection with
such sale.
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties
and other statements of the Corporation or its officers and of
the Agents set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation,
or statement as to the results thereof, made by or on behalf of
any Agent, the Corporation or any of their respective
representatives, officers or directors or any controlling person
and will survive delivery of and payment for the Notes. If this
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<PAGE>
Agreement is terminated pursuant to Section 10 or for any other
reason, the Corporation shall remain responsible for the expenses
to be paid or reimbursed by it pursuant to Section 4(g) and the
obligations of the Corporation under Sections 4(f) and (h) and
the respective obligations of the Corporation and the Agents
pursuant to Section 7 shall remain in effect. In addition, if
any such termination shall occur either (i) at a time when any
Agent shall own any of the Notes with the intention of reselling
them or (ii) after the Corporation has accepted an offer to
purchase Notes and prior to the related settlement, the
obligations of the Corporation under the last sentence of Section
4(b), under Sections 4(a), 4(c), 4(d), 4(e), 6(a), 6(e) and 6(f)
and, in the case of a termination occurring as described in (ii)
above, under Section 3(c) and under the last sentence of Section
8, shall also remain in effect.
10. Termination. This Agreement may be terminated for any
reason at any time by the Corporation as to any Agent or, in the
case of any Agent, by such Agent insofar as this Agreement
relates to such Agent, upon the giving of one day's written
notice of such termination to the other parties hereto. Any
settlement with respect to Notes placed by an Agent occurring
after termination of this Agreement shall be made in accordance
with the Procedures and each Agent agrees, if requested by the
Corporation, to take the steps therein provided to be taken by
such Agent in connection with such settlement.
11. Other Sales and Purchases of Notes. From time to time,
any Agent may agree with the Corporation to purchase all or a
portion of Notes from the Corporation as an underwriter (acting
either alone or in conjunction with one or more investment
banking firms) for resale to the public. In this event, such
purchase shall be made in accordance with the terms of a separate
agreement to be entered into between such Agent and the
Corporation in substantially the form attached hereto as Exhibit
C.
Without the oral consent (confirmed in writing) of the
Corporation, no Agent shall have the right to purchase all or a
portion of the Notes for its own account. In the event the
Corporation consents to such purchase, the purchase shall be made
in accordance with the terms of a separate agreement to be
entered into between such Agent and the Corporation in
substantially the form attached hereto as Exhibit D.
Nothing in this Agreement shall prohibit the sale of all
or a portion of Notes directly by the Corporation to any person
or entity without the involvement of any of the Agents or from
entering into similar agreements with other firms as agents.
The Corporation will not appoint another agent without
providing each Agent with at least one business day's notice.
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<PAGE>
12. Notices. Except as otherwise provided herein, all
notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices
to Lehman Brothers Inc. shall be mailed, delivered or telecopied
to it at 3 World Financial Center, 12th Floor, New York, New York
10285-1200, telecopier, (212) 528-1718, Attention: Medium-Term
Note Department; notices to Goldman, Sachs & Co. shall be mailed,
delivered or telecopied to it at 85 Broad Street, New York, New
York 10004, telecopier, (212)902-3000, Attention: Registration
Department; notices to Merrill Lynch & Co. shall be mailed,
delivered or telecopied to it at 250 Vesey Street, New York, New
York 10281, telecopier, (212) 449-2234, Attention: MTN Product
Management; and notices to the Corporation shall be mailed,
delivered or telecopied to it at 39 W. Lexington Street,
Baltimore, Maryland 21201, telecopier, (410) 234-5367, Attention:
Treasurer, 8th Floor, Gas and Electric Building, or in the case
of any party hereto, to such other address or person as such
party shall specify to each other party by a notice given in
accordance with the provisions of this Section 12. Any such
notice shall take effect at the time of receipt.
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto, their respective
successors, the officers and directors and controlling persons
referred to in Section 7 and, to the extent provided in Section
6(f), any person who has agreed to purchase Notes from the
Corporation, and no other person will have any right or
obligation hereunder.
14. Governing Law; Counterparts. This Agreement shall be
governed by and construed in accordance with the laws of the
State of New York. This Agreement may be executed in
counterparts and the executed counterparts shall together
constitute a single instrument.
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<PAGE>
If the foregoing correctly sets forth our agreement, please
indicate your acceptance hereof in the space provided for that
purpose below.
Very truly yours,
CONSTELLATION ENERGY CORPORATION
By: _____________________________
CONFIRMED AND ACCEPTED, as of the
date first above written:
LEHMAN BROTHERS INC.
By: _____________________
GOLDMAN, SACHS & CO.
_______________________
Goldman, Sachs & Co.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: ___________________
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<PAGE>
Exhibit A
to Agency Agreement
The Corporation agrees to pay any Agent a commission equal to
the following percentage of the principal amount of Notes sold to
purchasers solicited by such Agent:
Commission Rate
(as a percentage of
Term principal amount)
------------------------------- ------------------
9 months to less than 12 months .125
12 months to less than 18 months .15
18 months to less than 24 months .20
2 years to less than 3 years .25
3 years to less than 4 years .35
4 years to less than 5 years .45
5 years to less than 7 years .50
7 years to less than 10 years .55
10 years to less than 15 years .60
15 years to less than 20 years .65
20 years through 30 years .75
<PAGE>
Exhibit B
to Agency Agreement
Exhibit B to the Agency Agreement will be added at the time the
Agency Agreement is signed and will consist of administrative
procedures agreed on by the Corporation and the Agents.
<PAGE>
Exhibit C
to Agency Agreement
CONSTELLATION ENERGY CORPORATION
MEDIUM-TERM NOTES, SERIES F
FORM OF PURCHASE AGREEMENT
INCLUDING
STANDARD PURCHASE PROVISIONS
<PAGE>
CONSTELLATION ENERGY CORPORATION
MEDIUM-TERM NOTES, SERIES F
PURCHASE AGREEMENT
________________________
(Date)
Constellation Energy Corporation
39 W. Lexington Street
Baltimore, Maryland 21201
Dear Sirs:
Referring to the Medium-Term Notes, Series F of Constellation
Energy Corporation (the "Corporation") covered by the
registration statement on Form S-3 (No. 333-______), (such
registration statement, including (i) the prospectus included
therein, dated _________________, as supplemented by a prospectus
supplement dated ____________ in the form first filed under Rule
424(b) (such prospectus as so supplemented, including each
document incorporated by reference therein is hereinafter called
the "Prospectus") and (ii) all documents filed as part thereof or
incorporated by reference therein, is hereinafter called the
"Registration Statement") on the basis of the representations,
warranties and agreements contained in this Agreement, but
subject to the terms and conditions herein set forth, the
purchaser or purchasers named in Schedule A hereto (the
"Purchasers") agree to purchase, severally, and the Corporation
agrees to sell to the Purchasers, severally, the respective
principal amounts of the Corporation's Medium-Term Notes, Series
F having the terms described below (the "Purchased Notes") set
forth opposite the name of each Purchaser on Schedule A hereto.
The price at which the Purchased Notes shall be purchased
from the Corporation by the Purchasers shall be ______% of the
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principal amount plus accrued interest, if any, from
_____________. The initial public offering price shall be _____%
of the principal amount plus accrued interest, if any, from
____________________. The Purchased Notes will be offered by the
Purchasers as set forth in the Prospectus Supplement relating to
such Purchased Notes.
The Purchased Notes will have the following terms:
Fixed Interest rate (if applicable): ________ % per annum
(accruing from )
Floating Interest Rate (if applicable):
Interest Rate Basis: ___________________
Spread: ___________________
Spread Multiplier: ___________________
Index Maturity: ___________________
Initial Interest Rate: ___________________
Maximum Interest Rate: ___________________
Minimum Interest Rate: ___________________
Interest Reset Dates: ___________________
Interest Determination Dates:___________________
Calculation Agent: ___________________
Interest Payment Dates: ___________________
Stated Maturity: ___________________
Redeemable by the Redemption Prices
Corporation on or after: (% of Principal Amount):
______________ ___________________
______________ ___________________
______________ ___________________
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Subject to Repurchase by
the Corporation at the Repurchase Prices
option of the holder on: (% of Principal Amount)
______________ ___________________
______________ ___________________
______________ ___________________
The "Closing Date" shall be: ___________________
The place to which the
Purchased Notes may be
checked, packaged and
delivered shall be: __________________
Notices to the Purchasers shall be sent to the following
address(es) or telecopier number(s):
If we are acting as Representative(s) for the several
Purchasers named in Schedule A hereto, we represent that we are
authorized to act for such several Purchasers in connection with
the transactions contemplated in this Agreement, and that, if
there are more than one of us, any action under this Agreement
taken by any of us will be binding upon all the Purchasers.
All of the provisions contained in the document entitled
"Constellation Energy Corporation Standard Purchase Provisions,"
a copy of which has been previously furnished to us, are hereby
incorporated by reference in their entirety and shall be deemed
to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein.
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If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us the enclosed
duplicate hereof, whereupon it will become a binding agreement
between the Corporation and the several Purchasers in accordance
with its terms.
Very truly yours,
[Firm Name]
By __________________________
Title: _______________________
Acting on behalf of and as
Representative(s) of the
several Purchasers named in
Schedule A hereto.*
The foregoing Purchase
Agreement is hereby confirmed
as of the date first above
written
CONSTELLATION ENERGY CORPORATION
By _______________________
Title: _____________________
____________
* To be deleted if the Purchase Agreement is not
executed by one or more Purchasers acting as
Representative(s) of the Purchasers for purposes of this
Agreement.
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SCHEDULE A
Name of Purchaser Amount
_________________ ______
__________
Total $
===========
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CONSTELLATION ENERGY CORPORATION
STANDARD PURCHASE PROVISIONS
____________________________
From time to time, Constellation Energy Corporation, a
Maryland and Virginia corporation ("Corporation") may enter into
purchase agreements that provide for the sale of designated
securities to the purchaser or purchasers named therein. The
standard provisions set forth herein may be incorporated by
reference in any such purchase agreement ("Purchase Agreement").
The Purchase Agreement, including the provisions incorporated
therein by reference, is herein sometimes referred to as "this
Agreement." Unless otherwise defined herein, terms defined in
the Purchase Agreement are used herein as therein defined.
1. Introductory. The Corporation proposes to issue and
sell from time to time its Medium-Term Notes, Series F ("Notes")
registered under the registration statement referred to in
Section 2(a). The Notes will be issued under an Indenture, dated
as of April 4, 1997, between the Corporation and The Bank of New
York, as Trustee (the "Indenture"). The Notes will be sold to
the Purchasers for resale in accordance with the terms of the
offering determined at the time of the sale. The Notes involved
in any such offering are hereinafter referred to as the
"Purchased Notes," and the firm or firms, as the case may be,
which agree to purchase the same are hereinafter referred to as
the "Purchasers" of such Purchased Notes. The terms "you" and
"your" refer to those Purchasers who sign the Purchase Agreement
either on behalf of themselves only or on behalf of themselves
and as representatives of the several Purchasers named in
Schedule A thereto, as the case may be.
2. Representations and Warranties of the Corporation.
The Corporation represents and warrants to and agrees with each
Purchaser that:
(a) A registration statement on Form S-3 (No. 333-_____),
covering $300 million principal amount of the Notes,
including a prospectus has been filed with the Securities and
Exchange Commission ("Commission") and has become effective.
The terms Registration Statement and Prospectus shall have
the meanings ascribed to them in the Purchase Agreement.
(b) The Registration Statement conforms in all respects
to the requirements of the Securities Act of 1933, as amended
("Act"), and the pertinent published rules and regulations of
the Commission thereunder ("33 Act Rules and Regulations")
and the Trust Indenture Act of 1939, as amended ("Trust
Indenture Act"), and does not include any untrue statement of
a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements
therein not misleading, except that the foregoing does not
apply to statements or omissions in such document based upon
written information furnished to the Corporation by any
Purchaser specifically for use therein. The documents
incorporated by reference in the Registration Statement or
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the Prospectus pursuant to Item 12 of Form S-3 of the Act, at
the time they were filed with the Commission, complied in all
material respects with the requirements of the Securities
Exchange Act of 1934, as amended ("Exchange Act"), and the
pertinent published rules and regulations thereunder
("Exchange Act Rules and Regulations"). Any additional
documents deemed to be incorporated by reference in the
Prospectus will, when they are filed with the Commission,
comply in all material respects with the requirements of the
Exchange Act and the Exchange Act Rules and Regulations and
will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
3. Delivery and Payment. The Corporation will deliver
the Purchased Notes to you for the accounts of the Purchasers, at
the offices of the Trustee (at the place specified in the
Purchase Agreement) against payment of the purchase price by
certified or official bank check or checks in same day or New
York or Baltimore Clearing House funds drawn to the order of the
Corporation, at the office of the Corporation, 39 W. Lexington
Street, Baltimore, Maryland, at the time set forth in this
Agreement or at such other time not later than seven full
business days thereafter as you and the Corporation determine,
such time being herein referred to as the "Closing Date." The
Purchased Notes so to be delivered will be in definitive fully
registered form registered in such denominations, of $1,000 or
multiples thereof, and in such names as you request in writing
not later than 3:00 p.m., New York Time, on the third full
business day prior to the Closing Date, or, if no such request is
received, in the names of the respective Purchasers in the
amounts agreed to be purchased by them pursuant to this
Agreement. The Corporation shall make the Purchased Notes
available for checking and packaging at the offices of the
Trustee (at the place specified in the Purchase Agreement) prior
to the Closing Date and, unless prevented from doing so by
circumstances beyond its control, not later than 2:00 p.m., New
York Time, on the business day next preceding the Closing Date.
If you request that any Purchased Notes be issued in a name or
names other than that of the Purchaser agreeing to purchase such
Purchased Notes hereunder, the Corporation shall not be obligated
to pay any transfer taxes resulting therefrom. The Notes may
also be represented by a permanent global Note or Notes,
registered in the name of The Depository Trust Corporation, as
depositary (the "Depositary"), or a nominee of the Depositary
(each such Note represented by a permanent global Note being
referred to herein as a "Book-Entry Note"). Beneficial interests
in Book-Entry Notes will only be evidenced by, and transfers
thereof will only be effected through, records maintained by the
Depositary's participants.
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4. Offering by the Purchasers. The several Purchasers
propose to offer the Purchased Notes for sale to the public as
set forth in the Prospectus.
5. Covenants of the Corporation. The Corporation
covenants and agrees with the several Purchasers that:
(a) It will promptly cause the Prospectus to be filed
with the Commission as required by Rule 424.
(b) For as long as a prospectus relating to the Purchased
Notes is required to be delivered under the Act, if any event
relating to or affecting the Corporation or of which the
Corporation shall be advised in writing by the Purchasers
shall occur which, in the Corporation's opinion, should be
set forth in a supplement or amendment to the Prospectus in
order either to make the Prospectus comply with the
requirements of the Act or which would require the making of
any change in the Prospectus so that as thereafter delivered
to purchasers such Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light
of the circumstances under which they were made, not
misleading, the Corporation will promptly amend or supplement
the Prospectus by either (i) preparing and filing with the
Commission supplement(s) or amendment(s) to the Prospectus,
or (ii) making an appropriate filing pursuant to the Exchange
Act, which will supplement or amend the Prospectus so that,
as supplemented or amended, the Prospectus when the
Prospectus is delivered to a purchaser will comply with the
Act and will not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading. Prior to any
such filing, the Corporation shall give oral notice to the
Purchasers.
(c) Not later than 45 days after the end of the 12-month
period beginning at the end of the fiscal quarter of the
Corporation in which the Closing Date occurs, the Corporation
will make generally available to its security holders an
earnings statement (which need not be audited) covering such
12-month period which will satisfy the provisions of Section
11(a) of the Act.
(d) The Corporation will furnish to you copies of the
following documents, in each case as soon as available after
filing and in such quantities as you reasonably request (i)
the Registration Statement relating to the Notes as
originally filed and all pre-effective amendments thereto (at
least one of which will be signed and will include all
exhibits except those incorporated by reference to previous
filings with the Commission); (ii) each prospectus relating
to the Purchased Notes; and (iii) during the time when a
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prospectus relating to the Purchased Notes is required to be
delivered under the Act, all post-effective amendments and
supplements to the Registration Statement or Prospectus,
respectively (except supplements relating to securities that
are not Purchased Notes).
(e) The Corporation will use its best efforts to obtain
the qualification of the Purchased Notes for sale and the
determination of their eligibility for investment under the
laws of such jurisdictions as you designate and will continue
such qualifications in effect so long as required for the
distribution, provided, however, that the Corporation shall
not be required to qualify as a foreign corporation or to
file any consent to service of process under the laws of any
jurisdiction or to comply with any other requirements deemed
by the Corporation to be unduly burdensome.
(f) During the period of five years after the Closing
Date, the Corporation will furnish to you, and upon request,
to each of the other Purchasers: (i) as soon as practicable
after the end of each fiscal year, a copy of its annual
report to shareholders for such year, (ii) as soon as
available, a copy of each report or definitive proxy
statement of the Corporation filed with the Commission under
the Exchange Act or mailed to shareholders, and (iii) from
time to time, such other information concerning the
Corporation as you may reasonably request.
(g) The Corporation will pay all expenses incident to the
performance of its obligations under this Agreement, and will
reimburse the Purchasers for any expenses (including Blue Sky
fees not exceeding $6,000 and disbursements of counsel)
incurred by them in connection with qualification of the
Purchased Notes for sale and determination of their
eligibility for investment under the laws of such
jurisdictions as you designate and the printing of memoranda
relating thereto, for any filing fees charged by investment
rating agencies for the rating of the Purchased Notes, for
any expenses incurred in connection with listing the
Purchased Notes on a national securities exchange and for
expenses incurred in distributing prospectuses to the
Purchasers, except that if this Agreement is terminated by
the Purchasers under Section 6(c) hereof, the Corporation
shall not be obligated to reimburse the Purchasers for any of
the foregoing expenses.
(h) The Corporation will not offer or sell any of its
other debt securities which are substantially similar to the
Purchased Notes prior to ten business days after the Closing
Date without the consent of the Purchasers.
6. Conditions of the Obligations of the Purchasers. The
obligations of the several Purchasers to purchase and pay for the
Purchased Notes will be subject to the accuracy of the
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representations and warranties on the part of the Corporation
herein, to the accuracy of the statements of Corporation officers
made pursuant to the provisions hereof, to the performance by the
Corporation of its obligations hereunder and to the following
additional conditions precedent:
(a) Subsequent to the signing of this Agreement, you
shall have received letters of Coopers & Lybrand related to
Baltimore Gas and Electric Company and Price Waterhouse
related to Potomac Electric Power Company, dated the Closing
Date, confirming that they are independent public accountants
within the meaning of the Act and the 33 Act Rules and
Regulations, and stating in effect that for the respective
companies that:
(i) In their opinion, the consolidated financial
statements and supporting schedules audited by them which
are included in the company's Form 10-K ("Form 10-K"),
which is incorporated by reference in the Registration
Statement comply in form in all material respects with
the applicable accounting requirements of the Act and the
33 Act Rules and Regulations and the Exchange Act and the
Exchange Act Rules and Regulations;
(ii) On the basis of procedures specified in such
letter (but not an audit in accordance with generally
accepted auditing standards), including reading the
minutes of meetings of the shareholders, the Board of
Directors and the Executive Committee of the company
since the end of the year covered by the Form 10-K as set
forth in the minute books through a specified date not
more than five days prior to the Closing Date, performing
procedures specified in Statement on Auditing Standards
No. 71, Interim Financial Information, on the unaudited
interim consolidated financial statements of the company
incorporated by reference in the Registration Statement,
if any, and reading the latest available unaudited
interim consolidated financial statements of the company,
and making inquiries of certain officials of the company
who have responsibility for financial and accounting
matters as to whether the latest available financial
statements not incorporated by reference in the
Registration Statement are prepared on a basis
substantially consistent with that of the audited
consolidated financial statements incorporated in the
Registration Statement, nothing has come to their
attention that has caused them to believe that (1) any
unaudited consolidated financial statements incorporated
by reference in the Registration Statement do not comply
in form in all material respects with the applicable
requirements of the Act and the 33 Act Rules and
Regulations and the Exchange Act and the Exchange Act
Rules and Regulations or any material modifications
should be made to those unaudited consolidated financial
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statements for them to be in conformity with generally
accepted accounting principles; (2) at the date of the
latest available balance sheet not incorporated by
reference in the Registration Statement there was any
change in the capital stock, change in long-term debt or
decrease in consolidated net assets or common
shareholders' equity as compared with the amounts shown
in the latest balance sheet incorporated by reference in
the Registration Statement or for the period from the
closing date of the latest income statement incorporated
by reference in the Registration Statement to the closing
date of the latest available income statement read by
them there were any decreases, as compared with the
corresponding period of the previous year, in operating
revenues, operating income, net income, the ratio of
earnings to fixed charges (measured on the most recent
twelve month period), or in earnings per share of common
stock except in all instances of changes or decreases
that the Registration Statement discloses have occurred
or may occur, or which are described in such letter; or
(3) at a specified date not more than five days prior to
the Closing Date, there was any change in the capital
stock or long-term debt of the company or, at such date,
there was any decrease in net assets of the company as
compared with amounts shown in the latest balance sheet
incorporated by reference in the Registration Statement,
[or for the period from the closing date of the latest
income statement incorporated by reference in the
Registration Statement to a specified date not more than
five days prior to the Closing Date, there were any
decreases as compared with the corresponding period of
the previous year, in operating revenues, operating
income, net income or in earnings applicable to common
stock,] except in all cases for changes or decreases
which the Registration Statement discloses have occurred
or may occur, or which are described in such letter; and
(iii) Certain specified procedures have been applied
to certain financial or other statistical information (to
the extent such information was obtained from the general
accounting records of the company) set forth or
incorporated by reference in the Registration Statement
and that such procedures have not revealed any
disagreement between the financial and statistical
information so set forth or incorporated and the
underlying general accounting records of the company,
except as described in such letter.
(b) Prior to the Closing Date, no stop order suspending
the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have
been instituted, or to the knowledge of the Corporation or
you, shall be contemplated by the Commission.
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(c) Subsequent to the date of this Agreement, (i) there
shall not have occurred any change or any development
involving a prospective change not contemplated by the
Prospectus in or affecting particularly the business or
properties of the Corporation which, in the judgment of a
majority in interest of the Purchasers including you,
materially impairs the investment quality of the Purchased
Notes, (ii) no rating of any of the Corporation's debt
securities shall have been lowered by any recognized rating
agency and (iii) trading in securities generally on the New
York Stock Exchange shall not have been suspended nor
limited, other than a temporary suspension in trading to
provide for an orderly market, nor shall minimum prices have
been established on such Exchange, a banking moratorium shall
not have been declared either by New York State or Federal
authorities and there shall not have occurred an outbreak or
escalation of major hostilities in which the United States is
involved or other substantial national or international
calamity or crisis, the effect of which on the financial
markets of the United States is such as to make it, in your
judgment, impracticable to market the Purchased Notes.
(d) There shall not be in effect on the Closing Date any
order of the Public Service Commission of Maryland or the
Public Service Commission of the District of Columbia which
would prevent the issuance, sale and delivery of the
Purchased Notes in accordance with the terms contemplated by
this Agreement.
(e) You shall have received an opinion, dated the Closing
Date, of counsel of the Corporation (relying on Piper and
Marbury as to Virginia law) to the effect that:
(i) The Corporation has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of Maryland and the Commonwealth of
Virginia, with power and authority (corporate and other)
to own its respective properties and conduct its
respective businesses as described in the Prospectus; and
the Corporation is duly qualified to do business as a
foreign corporation in good standing in the Commonwealth
of Pennsylvania, the District of Columbia and all other
jurisdictions in which the conduct of its business or the
ownership of its properties requires such qualification
and the failure to do so would have a material and
adverse impact on its financial condition;
(ii) The Indenture has been duly authorized, executed
and delivered by the Corporation and is a valid
instrument, legally binding on the Corporation and
enforceable in accordance with its terms, except as
limited by bankruptcy, insolvency, or other laws
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affecting the enforcement of creditors' rights and by
general principles of equity;
(iii) The issuance and sale of the Purchased
Notes have been duly authorized by all necessary
corporate action of the Corporation. The Purchased Notes
being delivered to the Purchasers at the Closing
(assuming that they have been duly authenticated by the
Trustee or a duly designated Authentication Agent under
the Indenture, which fact counsel need not verify by an
inspection of the Purchased Notes), have been duly issued
and constitute legal, valid, and binding obligations of
the Corporation enforceable in accordance with their
terms, and are entitled to the benefits provided by the
Indenture except as such enforceability or entitlement
may be limited by bankruptcy, insolvency, or other laws
affecting the enforcement of creditors' rights and by
general principles of equity;
(iv) The Registration Statement has become
effective under the Act and, (a) to the best of such
counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the Act;
(b) the Registration Statement (as of its effective date)
and the Prospectus (as of the date of this Agreement) and
any amendments or supplements thereto, as of their
respective dates, appeared to comply as to form in all
material respects with the requirements of Form S-3 under
the Act and the 33 Act Rules and Regulations and the
Trust Indenture Act; (c) such counsel has no reason to
believe that either the Registration Statement or the
Prospectus, or any such amendment or supplement, as of
such respective dates, contained any untrue statement of
a material fact or omitted to state any material fact
required to be stated therein or necessary to make the
statement therein not misleading; (d) the descriptions in
the Registration Statement and Prospectus of statutes,
legal and governmental proceedings and contracts and
other documents are accurate and fairly present the
information required to be shown; (e) and such counsel
does not know of any legal or governmental proceedings
required to be described in the Prospectus which are not
described as required, or of any contracts or documents
of a character required to be described in the
Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not
described or filed as required; it being understood that
such counsel, in addressing the matters covered in this
paragraph (iv) need express no opinion as to the
financial statements or other financial and statistical
information contained in the Registration Statement or
the Prospectus or incorporated therein or attached as an
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exhibit thereto or as to the Statement of Eligibility and
Qualification on Form T-l of the Trustee under the
Indenture.
(v) The approvals of the Public Service Commission of
Maryland and the Public Service Commission of the
District of Columbia necessary for the valid issuance by
the Corporation of the Purchased Notes pursuant to this
Agreement have been obtained and continue in full force
and effect. The Corporation has received the approval of
FERC for the issuance of Purchased Notes on or before
December 31, 1998 with maturities of not more than 12
months after the date of issuance and the approval of
FERC will be required for the issuance of any Purchased
Notes having such maturities after December 31, 1998 and
such counsel knows of no other approval of any other
regulatory authority which is legally required for the
valid offering, issuance, sale and delivery of the
Purchased Notes by the Corporation under this Agreement
(except that such opinion need not pass upon the
requirements of state securities acts);
(vi) To the best of such counsel's knowledge and
belief, the consummation of the transactions contemplated
in this Agreement and the compliance by the Corporation
with all the terms of the Indenture did not and will not
result in a breach of any of the terms and provisions of,
or constitute a default under, the Corporation's Charter
or By-Laws or any indenture, mortgage or deed of trust or
other agreement or instrument to which the Corporation is
a party;
(vii) Each of this Agreement, the Interest
Calculation Agency Agreement and the Letter of
Representations has been duly authorized, executed and
delivered by the Corporation;
(viii) The Indenture is duly qualified under the
Trust Indenture Act;
(ix) The issuance, sale and delivery of the Purchased
Notes as contemplated by this Agreement are not subject
to the approval of the Securities and Exchange Commission
under the provisions of the Public Utility Holding
Company Act of 1935 (the "1935 Act"); and
(x) The Notes and Indenture conform as to legal
matters with the statements concerning them in the
Registration Statement and Prospectus under the caption
"DESCRIPTION OF NOTES" and on the cover page of the
Prospectus.
(f) The Purchasers shall have received from Cahill Gordon
& Reindel, counsel for the Purchasers, an opinion dated the
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Closing Date, with respect to the matters referred to in
paragraph 6(e) subheadings (ii), (iii), (iv)(b), (v), (vii),
(viii) and (x) and such other matters as the Purchasers shall
reasonably request and the Corporation shall have furnished to
such counsel such documents as they request for the purpose of
enabling them to pass on such matters.
In rendering such opinion, Cahill Gordon & Reindel
may rely, as to the incorporation of the Corporation, the
approvals of the Public Service Commission of Maryland and the
Public Service Commission of the District of Columbia required
for the issuance, sale and delivery of the Purchased Notes and
all other matters governed by the laws of the State of Maryland
and the Commonwealth of Virginia, the applicability of the 1935
Act, and FERC approval for the issuance, sale and delivery of the
Purchased Notes, upon the opinion of Counsel for the Corporation
referred to above.
In addition, such counsel shall state that such
counsel has participated in conferences with officers, counsel
and other representatives of the Corporation, representatives of
the independent public accountants for the Corporation and
representatives of the Purchasers at which the contents of the
Registration Statement and the Prospectus and related matters
were discussed; and, although such counsel is not passing upon
and does not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration
Statement and Prospectus (except as to the matters referred to in
their opinion rendered pursuant to subheading (x) above), on the
basis of the foregoing (relying as to materiality to a large
extent upon the opinions of officers, counsel and other
representatives of the Corporation), no facts have come to the
attention of such counsel which lead such counsel to believe that
either the Registration Statement (as of its effective date) or
the Prospectus (as of the date of this Agreement), and any
subsequent amendments or supplements thereto, as of their
respective dates, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make such statements therein not
misleading (it being understood that such counsel need make no
comment with respect to the financial statements and other
financial and statistical data included in the Registration
Statement or Prospectus or incorporated therein or as to the
Statement of Eligibility and Qualification on Form T-l of the
Trustee under the Indenture).
(g) You shall have received a certificate of the Chairman
of the Board, Chief Executive Officer, Vice Chairman,
President, any Vice President or the Treasurer and a
principal financial or accounting officer of the Corporation,
dated the Closing Date, in which such officers shall state,
to the best of their knowledge after reasonable
investigation, and relying on opinions of counsel to the
extent that legal matters are involved, that the
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representations and warranties of the Corporation in this
Agreement are true and correct in all material respects, that
the Corporation has complied with all agreements and
satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date, that no stop order
suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission, and that,
subsequent to the date of the most recent financial
statements set forth or incorporated by reference in the
Prospectus, there has been no material adverse change in the
financial position or in the financial results of operation
of the Corporation except as set forth or contemplated in the
Prospectus or as described in such certificate.
(h) The Corporation will furnish you with such conformed
copies of such opinions, certificates, letters and documents
as you reasonably request.
In case any such condition shall not have been satisfied,
this Agreement may be terminated by you upon notice in writing or
by telecopy to the Corporation without liability or obligation on
the part of the Corporation or any Purchaser, except as set forth
in Section 10 hereof.
7. Conditions of the Obligations of the Corporation. The
obligations of the Corporation to sell and deliver the Purchased
Notes are subject to the following conditions precedent:
(a) Prior to the Closing Date, no stop order suspending
the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have
been instituted or, to the knowledge of the Corporation or
you, shall be contemplated by the Commission.
(b) There shall not be in effect on the Closing Date any
order of the Public Service Commission of Maryland, the
Public Service Commission of the District of Columbia, or the
Federal Energy Regulatory Commission which would prevent the
issuance, sale and delivery of the Purchased Notes or which
contains conditions or provisions with respect thereto which
are not acceptable to the Corporation, it being understood
that no order in effect at the date of this Agreement
contains any such unacceptable conditions or provisions.
If any such condition shall not have been satisfied, then
the Corporation shall be entitled, by notice in writing or by
telecopy to you, to terminate this Agreement without any
liability on the part of the Corporation or any Purchaser,
except as set forth in Section 10 hereof.
8. Indemnification.
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<PAGE>
(a) The Corporation will indemnify and hold harmless each
Purchaser and each person, if any, who controls any Purchaser
within the meaning of the Act or Exchange Act against any
losses, claims, damages or liabilities, joint or several, to
which such Purchaser or such controlling person may become
subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in
the Registration Statement or the Prospectus, or any related
preliminary prospectus or arise out of or are based upon the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the
statements therein not misleading; and will reimburse each
Purchaser and each such controlling person for any legal or
other expenses reasonably incurred by such Purchaser or such
controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided, however, that the Corporation will not be liable to
such Purchaser or controlling person in any such case to the
extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any such
documents in reliance upon and in conformity with written
information furnished to the Corporation by such Purchaser or
such controlling person specifically for use therein unless
such loss, claim, damage or liability arises out of the offer
or sale of the Purchased Notes occurring after such Purchaser
or controlling person has notified the Corporation in writing
that such information should no longer be used therein. This
indemnity agreement will be in addition to any liability
which the Corporation may otherwise have.
(b) Each Purchaser will indemnify and hold harmless the
Corporation, each of its directors, each of its officers who
have signed the Registration Statement and each person, if
any, who controls the Corporation within the meaning of the
Act or the Exchange Act, against any losses, claims, damages
or liabilities to which the Corporation or any such director,
officer or controlling person may become subject, under the
Act, or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration
Statement or the Prospectus, or any related preliminary
prospectus or arise out of or are based upon the omission or
the alleged omission to state therein a material fact
required to be stated therein or necessary to make the
statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written
information furnished to the Corporation by such Purchaser
specifically for use therein; and will reimburse any legal or
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<PAGE>
other expenses reasonably incurred by the Corporation or any
such director, officer or controlling person in connection
with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided,
however, that such Purchaser will not be liable to the
Corporation, or any such director, officer or controlling
person in any such case to the extent that any such loss,
claim, damage or liability arises out of the offer or sale of
Purchased Notes occurring after such Purchaser has notified
the Corporation in writing that such information should no
longer be used therein. This indemnity agreement will be in
addition to any liability which such Purchaser may otherwise
have.
(c) Promptly after receipt by an indemnified party under
this Section of notice of the commencement of any action,
such indemnified party will, if a claim in respect thereof is
to be made against the indemnifying party under (a) and (b)
above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section. In
case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled
to participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel satisfactory to
such indemnified party (who may, with the consent of the
indemnified party, be counsel to the indemnifying party) and
who shall not be counsel to any other indemnified party who
may have interests conflicting with those of such indemnified
party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable
costs of investigation.
(d) If recovery is not available under the foregoing
indemnification provisions of this Section, for any reason
other than as specified therein, the parties entitled to
indemnification by the terms thereof shall be entitled to
contribution to liabilities and expenses, except to the
extent that contribution is not permitted under Section 11(f)
of the Act. In determining the amount of contribution to
which the respective parties are entitled, there shall be
considered the relative benefits received by each party from
the offering of the Purchased Notes (taking into account the
portion of the proceeds of the offering realized by each),
the parties' relative knowledge and access to information
concerning the matter with respect to which the claim was
asserted, the opportunity to correct and prevent any
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<PAGE>
statement or omission, and any other equitable considerations
appropriate under the circumstances. The Corporation and the
Purchasers and such controlling persons agree that it would
not be equitable if the amount of such contribution were
determined by pro rata or per capita allocation (even if the
Purchasers and such controlling persons were treated as one
entity for such purpose). Notwithstanding the provisions of
this subsection (d), no Purchaser or controlling person shall
be required to make contribution hereunder which in the
aggregate exceeds the total public offering price of the
Purchased Notes, purchased by the Purchaser under this
Agreement, less the aggregate amount of any damages which
such Purchaser or such controlling person has otherwise been
required to pay in respect of the same claim or any
substantially similar claim. The Purchasers' obligations to
contribute are several in proportion to their respective
underwriting obligations and are not joint.
9. Default of Purchasers. If any Purchaser or
Purchasers default in their obligations to purchase Purchased
Notes hereunder and the aggregate principal amount of Purchased
Notes which such defaulting Purchaser or Purchasers agreed but
failed to purchase is 10% of the principal amount of Purchased
Notes or less, you may make arrangements satisfactory to the
Corporation for the purchase of such Purchased Notes by other
persons, including any of the Purchasers, but if no such
arrangements are made by the Closing Date the non-defaulting
Purchasers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Purchased Notes
which such defaulting Purchasers agreed but failed to purchase.
If any Purchaser or Purchasers so default and the aggregate
principal amount of Purchased Notes with respect to which such
default or defaults occur is more than the above percentage and
arrangements satisfactory to you and the Corporation for the
purchase of such Purchased Notes by other persons are not made
within thirty-six hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting
Purchaser or the Corporation, except as provided in Section 10.
In the event that any Purchaser or Purchasers default in their
obligation to purchase Purchased Notes hereunder, the Corporation
may, by prompt written notice to the non-defaulting Purchasers,
postpone the Closing Date for a period of not more than seven
full business days in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the
Prospectus or in any other documents, and the Corporation will
promptly file any amendments to the Registration Statement or
supplements to the Prospectus which may thereby be made
necessary. As used in this Agreement, the term "Purchaser"
includes any person substituted for a Purchaser under this
Section. Nothing herein will relieve a defaulting Purchaser from
liability for its default.
10. Survival of Certain Representations and Obligations.
The respective indemnities, agreements, representations,
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<PAGE>
warranties, and other statements of the Corporation or its
officers and of the several Purchasers set forth in or made
pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results
thereof, made by or on behalf of any Purchaser or the Corporation
or any of its officers or directors or any controlling person,
and will survive delivery of and payment for the Purchased Notes.
If this Agreement is terminated pursuant to Section 6, 7 or 9 or
if for any reason the purchase of the Purchased Notes by the
Purchasers is not consummated, the Corporation shall remain
responsible for the expenses to be paid or reimbursed by it
pursuant to Section 5(g). In addition, in such event the
respective obligations of the Corporation and the Purchasers
pursuant to Section 8 shall remain in effect; provided, however,
that you will use your best efforts to promptly notify each other
Purchaser and each dealer and prospective customer to whom you
have delivered a Prospectus for the Purchased Notes by telephone
or telegraph, confirmed by letter in either case, of such
termination or failure to consummate, including in such notice
instructions regarding the continued use of the Registration
Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus.
11. Notices. All communications hereunder will be in
writing, and, if sent to the Purchasers will be mailed, delivered
or telecopied and confirmed to the address furnished in writing
for the purpose of such communications hereunder, or, if sent to
the Corporation, will be mailed, delivered or telecopied and
confirmed to it, attention of Treasurer at 39 W. Lexington
Street, Baltimore, Maryland 21201, telecopier (410) 234-5367;
provided, however, that any notice to a Purchaser pursuant to
Section 8 will be mailed, delivered or telecopied to such
Purchaser at its address appearing in its Purchasers'
Questionnaire.
12. Successors. This Purchase Agreement will inure to
the benefit of and be binding upon the parties hereto and their
respective successors and the officers and directors and
controlling persons referred to in Section 8, and no other person
will have any right or obligation hereunder.
13. Construction. This Purchase Agreement shall be
governed by and construed in accordance with the laws of the
State of Maryland.
14. Counterparts. This Agreement may be executed in one
or more counterparts and it is not necessary that the signatures
of all parties appear on the same counterpart, but such
counterparts together shall constitute but one and the same
agreement.
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<PAGE>
Exhibit D
to Agency Agreement
PURCHASE AGREEMENT
(for purchaser's account)
[Date]
Constellation Energy Corporation
39 W. Lexington Street
Baltimore, Maryland 21201
Attention: Treasurer
The undersigned agrees to purchase the following
principal amount of the Notes described in the Agency Agreement
among Constellation Energy Corporation; Lehman Brothers, Lehman
Brothers Inc.; Goldman, Sachs & Co.; and Merrill Lynch & Co.,
Merrill Lynch Pierce, Fenner & Smith Incorporated dated
_____________, 1997 (the "Agency Agreement"):
Principal Amount: $ _________________
Fixed Interest Rate (if applicable): _________________ %
Floating Interest Rate (if applicable):
Interest Rate Basis: ___________________
Spread: ___________________
Spread Multiplier: ___________________
Index Maturity: ___________________
Initial Interest Rate: ___________________
Maximum Interest Rate: ___________________
Minimum Interest Rate: ___________________
<PAGE>
Interest Reset Dates: ___________________
Interest Determination Dates: ___________________
Calculation Agent: ___________________
Interest Payment Dates: ___________________
Stated Maturity: ___________________
Redeemable at the Redemption Prices
option of the Corporation (% of Principal Amount)
on or after:
________________ ___________________
________________ ___________________
________________ ___________________
Subject to repurchase
by the Corporation at the Repurchase Prices
option of the holder on: (% of Principal Amount)
________________ __________________
________________ __________________
________________ __________________
Discount: ______________ % of Principal Amount
Price to be paid
to Corporation
(in immediately
available funds): $ _______________
Settlement Date: ________________ , 19 ____
Except as otherwise expressly provided therein, all terms
used herein which are defined in the Agency Agreement shall have
the same meanings as in the Agency Agreement. The term Agent, as
used in the Agency Agreement, shall be deemed to refer only to
the undersigned for purposes of this Agreement.
This Agreement incorporates by reference Sections 4, 6,
7, 12 and 13 of the Agency Agreement, the first and last
sentences of Section 9 thereof and, to the extent applicable, the
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<PAGE>
Procedures. You and we agree to perform, to the extent
applicable, our respective duties and obligations specifically
provided to be performed by each of us in the Procedures.
Our obligation to purchase Notes hereunder is subject to
the accuracy on the above Settlement Date of your representations
and warranties contained in Section 2 of the Agency Agreement (it
being understood that such representations and warranties shall
relate to the Registration Statement and the Prospectus as
amended at such Settlement Date) and to your performance and
observance of all covenants and agreements contained in Sections
4 and 6 thereof. Our obligation hereunder is also subject to the
following conditions:
(a) the satisfaction, at such Settlement Date, of each of
the conditions set forth in subsections (a), (b) and (d) through
(h) of Section 5 of the Agency Agreement (it being understood
that each document so required to be delivered shall be dated
such Settlement Date and that each such condition and the
statements contained in each such document that relate to the
Registration Statement or the Prospectus shall be deemed to
relate to the Registration Statement or the Prospectus, as the
case may be, as amended or supplemented at the time of settlement
on such Settlement Date and except that the opinion described in
Section 5(d) of the Agency Agreement shall be modified so as to
state that the Notes being sold on such Settlement Date, when
delivered against payment therefor as provided in the Indenture
and this Agreement, will have been duly executed, authenticated,
issued and delivered and will constitute valid and legally
binding obligations of the Corporation enforceable in accordance
with their terms, subject only to the exceptions as to
enforcement set forth in clause (ii) of Section 5(d) of the
Agency Agreement, and will conform to the description thereof
contained in the Prospectus as amended or supplemented at such
Settlement Date); and
(b) there shall not have occurred (i) any change, or any
development involving a prospective change not contemplated by
the Prospectus, in or affecting particularly the business or
properties of the Corporation which, in our judgment, materially
impairs the investment quality of the Notes, (ii) any downgrading
in the rating of the Corporation's debt securities by any
"nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act); (iii) any
suspension or limitation of trading, other than a temporary
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<PAGE>
suspension in trading to provide for an orderly market, in
securities generally on the New York Stock Exchange, or any
setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the Corporation on any
exchange or in the over-the-counter market; (iv) any banking
moratorium declared by Federal or New York authorities; or (v)
any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or
any other substantial national or international calamity or
emergency if, in our judgment, the effect of any such outbreak,
escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the sale
of and payment for the Notes.
In further consideration of our agreement hereunder, you
agree that between the date hereof and the above Settlement Date,
you will not offer or sell, or enter into any agreement to sell,
any debt securities of the Corporation in the United States,
other than sales of Notes, borrowings under your revolving credit
agreements and lines of credit, the private placement of
securities and issuances of your commercial paper.
If for any reason our purchase of the above Notes is not
consummated, you shall remain responsible for the expenses to be
paid or reimbursed by you pursuant to Section 4 of the Agency
Agreement and the respective obligations of you and the
undersigned pursuant to Section 7 shall remain in effect. If for
any reason our purchase of the above Notes is not consummated
other than because of our default or a failure to satisfy a
condition set forth in clause (iii), (iv) or (v) of paragraph (b)
above, you shall reimburse us, severally, for all out-of-pocket
expenses reasonably incurred by us in connection with the
offering of the above Notes and not otherwise required to be
reimbursed pursuant to Section 4 of the Agency Agreement.
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<PAGE>
This Agreement shall be governed by and construed in
accordance with the laws of the State of Maryland. This
Agreement may be executed in counterparts and the executed
counterparts shall together constitute a single instrument.
[Insert Name of Purchaser]
By: _____________________
CONFIRMED AND ACCEPTED, as of
the date first above written:
CONSTELLATION ENERGY CORPORATION
By: ____________________________
<PAGE>
Exhibit 1(b)
$300,000,000
MEDIUM-TERM NOTES, SERIES F
DUE FROM NINE MONTHS TO THIRTY YEARS
FROM DATE OF ISSUE
INTEREST CALCULATION AGENCY AGREEMENT
_____________________________________
THIS AGREEMENT dated as of ______________
between Constellation Energy Corporation
(hereinafter called the "Issuer"), having its
principal office at 39 W. Lexington Street,
Baltimore, Maryland 21201, and The Bank of
New York, a New York banking corporation
(hereinafter sometimes called the
"Calculation Agent or Paying Agent" which
terms shall, unless the context shall
otherwise require, include its successors and
assigns), having its principal corporate
trust office at 101 Barclay Street, New York,
New York 10286.
Recitals of the Issuer
______________________
The Issuer proposes to issue from time to time up to
$300,000,000 aggregate principal amount of Medium-Term Notes,
Series F (the "Notes") under the Indenture dated as of April 4,
1997, (the "Indenture"), between the Issuer and The Bank of New
York (the "Trustee"), as Trustee. Capitalized terms used in
this Agreement and not otherwise defined herein are used as
defined in the Indenture. Certain of the Notes may bear interest
<PAGE>
at a floating rate determined by reference to an interest rate
formula (the "Floating Rate Notes") and the Issuer desires to
engage the Calculation Agent to perform certain services in
connection therewith.
NOW IT IS HEREBY AGREED THAT:
1. The Issuer hereby appoints The Bank of New York as
Calculation Agent for the Floating Rate Notes, upon the terms and
subject to the conditions herein mentioned, and The Bank of New
York hereby accepts such appointment. The Calculation Agent
shall act as an agent of the Issuer for the purpose of
determining the interest rate or rates of the Floating Rate
Notes.
2. The Issuer agrees to deliver to the Calculation
Agent, prior to the issuance of any Floating Rate Notes, copies
of the proposed forms of such Notes, including copies of all
terms and conditions relating to the determination of the
interest rate thereunder. The Issuer shall not issue any
Floating Rate Note prior to the receipt of confirmation from the
Calculation Agent of its acceptance of the proposed form of such
Note. The Calculation Agent hereby acknowledges its acceptance of
the proposed form of Floating Rate Note previously delivered to
it.
3. The Issuer shall notify the Calculation Agent of
the issuance of any Floating Rate Notes prior to the issuance
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<PAGE>
thereof and, at the time of such issuance, shall deliver to the
Calculation Agent the information required to be provided by the
Corporation for the calculation of the applicable interest rates
thereunder. The Calculation Agent shall calculate the applicable
interest rates for Floating Rate Notes in accordance with the
terms of such Notes, the Indenture and the provisions of this
Agreement.
4. Promptly following the determination of each
change to the interest rate applicable to any Floating Rate Note,
the Calculation Agent will cause to be forwarded to the Issuer,
the Trustee and the principal Paying Agent information regarding
the interest rate then in effect for such Floating Rate Note.
5. The Issuer will pay such compensation as shall be
agreed upon with the Calculation Agent and the expenses,
including reasonable counsel fees, incurred by the Calculation
Agent in connection with its duties hereunder, upon receipt of
such invoices as the Issuer shall reasonably require.
6. Notwithstanding any satisfaction or discharge of
the Notes or the Indenture, the Issuer will indemnify the
Calculation Agent against any losses, liabilities, costs, claims,
actions or demands which it may incur or sustain or which may be
made against it in connection with its appointment or the
exercise of its powers and duties hereunder as well as the
reasonable costs, including the expenses and fees of counsel in
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<PAGE>
defending any claim, action or demand, except such as may result
from the negligence, willful misconduct or bad faith of the
Calculation Agent or any of its employees. The Calculation Agent
shall incur no liability and shall be indemnified and held
harmless by the Issuer for, or in respect of, any actions taken
or suffered to be taken in good faith by the Calculation Agent in
reliance upon written instructions from the Issuer. In case any
action is brought against the Calculation Agent with respect to
which the Calculation Agent intends to seek indemnification from
the Issuer pursuant to this paragraph 6, the Calculation Agent
will notify the Issuer in writing of the commencement thereof,
and the Issuer will be entitled to participate therein and to
assume the defense thereof, with counsel satisfactory to the
Calculation Agent; PROVIDED, HOWEVER, that if the defendants in
any such action include both the Issuer and the Calculation Agent
and the Calculation Agent shall have reasonably concluded, after
consultation with legal counsel of its choosing, that there may
be legal defenses available to it which are different from or
additional to those available to the Issuer, the Calculation
Agent shall have the right to select separate counsel to assert
such legal defenses and otherwise to participate in the defense
of such action on behalf of the Calculation Agent, and in such
event the Issuer will indemnify the Calculation Agent against the
reasonable compensation and expenses and disbursements of such
separate counsel.
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<PAGE>
7. The Calculation Agent may consult with counsel
(and notify the Issuer of such consultation) and the written
advice of such counsel or any opinion of counsel shall be full
and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon.
8. The Calculation Agent accepts its obligations
herein set forth upon the terms and conditions hereof, including
the following, to all of which the Issuer agrees:
(i) in acting under this Agreement and in
connection with the Notes, the Calculation Agent,
acting as agent for the Issuer, does not assume any
obligation towards, or any relationship of agency or
trust for or with, any of the Holders of the Notes;
(ii) unless herein otherwise specifically
provided, any order, certificate, notice, request or
communication from the Issuer made or given under any
provision of this Agreement shall be sufficient if
signed by any person whom the Calculation Agent
reasonably believes to be a duly authorized officer or
attorney-in-fact of the Issuer;
(iii) the Calculation Agent shall be obligated to
perform only such duties as are set forth specifically
herein and any duties necessarily incidental thereto;
(iv) the Calculation Agent shall be protected and
shall incur no liability for or in respect of any
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<PAGE>
action taken or omitted to be taken or anything
suffered in good faith by it in reliance upon anything
contained in a Floating Rate Note, the Indenture or any
information supplied to it by the Issuer pursuant to
this Agreement, including the information to be
supplied pursuant to paragraph 3 above;
(v) the Calculation Agent, whether acting for
itself or in any other capacity, may become the owner
or pledgee of Notes with the same rights as it would
have had if it were not acting hereunder as Calculation
Agent; and
(vi) the Calculation Agent shall incur no
liability hereunder except for loss sustained by reason
of its negligence, willful misconduct or bad faith.
9. (a) The Issuer agrees to notify the Calculation
Agent at least 3 business days prior to the issuance of any
Floating Rate Note with an interest rate to be determined by
reference to London interbank offered rates (LIBOR) or any other
formula that would require the Calculation Agent to select banks
or other financial institutions (the "Reference Banks") for
purposes of quoting rates. Promptly thereafter, the Calculation
Agent will notify the Issuer and the Trustee of the names and
addresses of such Reference Banks. Forthwith upon any change in
the identity of the Reference Banks, the Calculation Agent shall
notify the Issuer and the Trustee of such change. The
Calculation Agent shall not be responsible to the Issuer or any
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<PAGE>
third party for any failure of the Reference Banks to fulfill
their duties or meet their obligations as Reference Banks or as a
result of the Calculation Agent having acted (except in the event
of negligence or willful misconduct) on any quotation or other
information given by any Reference Bank which subsequently may be
found to be incorrect.
(b) Except as provided below, the Calculation
Agent may at any time resign as Calculation Agent by giving
written notice to the Issuer and the Trustee of such intention on
its part, specifying the date on which its desired resignation
shall become effective, provided that such notice shall be given
not less than 60 days prior to the said effective date unless the
Issuer and the Trustee otherwise agree in writing. Except as
provided below, the Calculation Agent may be removed by the
filing with it and the Trustee of an instrument in writing signed
by the Issuer specifying such removal and the date when it shall
become effective (such effective date being at least 15 days
after said filing). Any such resignation or removal shall take
effect upon:
(i) the appointment by the Issuer as hereinafter
provided of a successor Calculation Agent; and
(ii) the acceptance of such appointment by such
successor Calculation Agent;
PROVIDED, HOWEVER, that in the event the Calculation Agent has
given not less than 60 days' prior notice of its desired
resignation, and during such 60 days there has not been
acceptance by a successor Calculation Agent of its appointment as
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<PAGE>
successor Calculation Agent, the Calculation Agent so resigning
may petition any court of competent jurisdiction for the
appointment of a successor Calculation Agent. The Issuer
covenants that it shall appoint a successor Calculation Agent as
soon as practicable after receipt of any notice of resignation
hereunder. Upon its resignation or removal becoming effective,
the retiring Calculation Agent shall be entitled to the payment
of its compensation and the reimbursement of all reasonable
expenses (including reasonable counsel fees) incurred by such
retiring Calculation Agent pursuant to paragraph 5 hereof.
(c) If at any time the Calculation Agent shall
resign or be removed, or shall become incapable of acting or
shall be adjudged bankrupt or insolvent, or liquidated or
dissolved, or an order is made or an effective resolution is
passed to wind up the Calculation Agent, or if the Calculation
Agent shall file a voluntary petition in bankruptcy or make an
assignment for the benefit of its creditors, or shall consent to
the appointment of a receiver, administrator or other similar
official of all or any substantial part of its property, or shall
admit in writing its inability to pay or meet its debts as they
mature, or if a receiver, administrator or other similar official
of the Calculation Agent or of all or any substantial part of its
property shall be appointed, or if any order of any court shall
be entered approving any petition filed by or against the
Calculation Agent under the provisions of any applicable
bankruptcy or insolvency law, or if any public officer shall take
charge or control of the Calculation Agent or its property or
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<PAGE>
affairs for the purpose of rehabilitation, conservation or
liquidation, then a successor Calculation Agent shall be
appointed by the Issuer by an instrument in writing filed with
the successor Calculation Agent and the Trustee. Upon the
appointment as aforesaid of a successor Calculation Agent and
acceptance by the latter of such appointment the former
Calculation Agent shall cease to be Calculation Agent hereunder.
(d) Any successor Calculation Agent appointed
hereunder shall execute and deliver to its predecessor, the
Issuer and the Trustee and instrument accepting such appointment
hereunder, and thereupon such successor Calculation Agent,
without any further act, deed or conveyance, shall become vested
with all the authority, rights, powers, immunities, duties and
obligations of such predecessor with like effect as if originally
named as the Calculation Agent hereunder, and such predecessor,
upon payment of its reasonable compensation, charges and
disbursements then unpaid, shall thereupon become obliged to
transfer and deliver, and such successor Calculation Agent shall
be entitled to receive, copies of any relevant records maintained
by such predecessor Calculation Agent.
(e) Any corporation into which the Calculation
Agent may be merged or converted or any corporation with which
the Calculation Agent may be consolidated or any corporation
resulting from any merger, conversion or consolidation to which
the Calculation Agent shall be a party shall, to the extent
permitted by applicable law, be the successor Calculation Agent
under this Agreement without the execution or filing of any paper
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<PAGE>
or any further act on the part of any of the parties hereto.
Notice of any such merger, conversion or consolidation shall
forthwith be given to the Issuer and the Trustee.
(f) The provisions of paragraph 6 hereof shall
survive any resignation or removal hereunder.
10. Any notice required to be given hereunder shall be
delivered in person, sent by letter or telex or telecopy or
communicated by telephone (subject, in the case of communication
by telephone, to confirmation dispatched within two business days
by letter, telex or telecopy), in the case of the Issuer, to it
at the address set forth in the heading of this Agreement,
Attention: Thomas E. Ruszin, Jr., Treasurer; in the case of the
Trustee or the Calculation Agent, to it at the address set forth
in the heading of this Agreement; or, in any case, to any other
address of which the party receiving notice shall have notified
the party giving such notice in writing.
11. This Agreement may be amended only by a writing
duly executed and delivered by each of the parties signing below.
12. The provisions of this Agreement shall be governed
by, and construed in accordance with, the laws of the State of
New York.
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<PAGE>
13. This Agreement may be executed in counterparts and
the executed counterparts shall together constitute a single
instrument.
IN WITNESS WHEREOF, this Agreement has been executed and
delivered as of the day and year first above written.
CONSTELLATION ENERGY CORPORATION
By: ___________________________
Title: ________________________
THE BANK OF NEW YORK
By: ___________________________
Title: ________________________
- 11 -
<PAGE>
Exhibit 4 (a)
CONSTELLATION ENERGY CORPORATION
AND
THE BANK OF NEW YORK
Trustee
__________
INDENTURE
Dated as of April 4, 1997
__________
<PAGE>
TABLE OF CONTENTS *
Page
PARTIES .............................................. 1
RECITALS .............................................. 1
Purpose of Indenture ................................. 1
Compliance with Legal Requirements ................... 1
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Definitions ............................. 2
Board of Directors ...................... 2
Board Resolution ....................... 2
Business Day ............................ 2
Corporation ............................. 3
Depositary .............................. 3
Discounted Security ..................... 3
Event of Default ........................ 3
Federal Bankruptcy Code ................. 3
Indenture ............................... 3
Officers' Certificate ................... 3
Opinion of Counsel ...................... 4
Outstanding ............................. 4
Principal Office of the Trustee ......... 5
Prospectus Supplement ................... 5
Responsible Officer ..................... 5
Security or Securities .................. 5
Securityholder........................... 5
Series .................................. 5
Trustee ................................. 5
Trust Indenture Act of 1939 ............. 6
Yield to Maturity ....................... 6
_______
* This table of contents shall not, for any purpose, be
deemed to be a part of the Indenture.
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<PAGE>
ARTICLE TWO
THE SECURITIES
Page
SECTION 2.01. Forms of Securities ..................... 6
SECTION 2.02. Authentication Agent and Form of
Certificate of Authentication ......... 7
SECTION 2.03. Global Securities ....................... 8
ARTICLE THREE
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND
EXCHANGE OF SECURITIES
SECTION 3.01. Title, Amount and Terms of Securities .... 8
SECTION 3.02. Denominations, Dates, Interest Payment and
Record Dates, and Place of Payment ..... 10
SECTION 3.03. Execution of Securities .................. 11
SECTION 3.04. Exchange and Registration of Transfer of
Securities ............................. 11
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen
Securities ............................. 14
SECTION 3.06. Temporary Securities ..................... 15
SECTION 3.07. Cancellation of Securities Paid, etc. .... 16
ARTICLE FOUR
REDEMPTION OF SECURITIES
SECTION 4.01. Applicability of This Article ............ 16
SECTION 4.02. Election to Redeem; Notice to Trustee .... 17
SECTION 4.03. Selection of Securities to be Redeemed ... 17
SECTION 4.04. Notice of Redemption ..................... 17
SECTION 4.05. Deposit of Redemption Price .............. 18
SECTION 4.06. Payment of Securities Called for Redemp-
tion .................................. 18
SECTION 4.07 Delegation of Duties by Trustee .......... 19
ii
<PAGE>
ARTICLE FIVE
PARTICULAR COVENANTS OF THE CORPORATION
Page
SECTION 5.01. To Pay Principal (and Premium, if any) and
Interest ............................... 19
SECTION 5.02. To Maintain Office or Agency ............. 20
SECTION 5.03. To Fill a Vacancy in the Office of Trustee 20
SECTION 5.04. Appointment of Paying Agents; Money for
Security Payments to be Set Aside in
Trust; Transfer of Moneys Held by Paying
Agents ................................. 20
SECTION 5.05. Maintenance of Corporate Existence, Rights
and Franchises ......................... 22
SECTION 5.06. Certificate as to No Default ............. 22
ARTICLE SIX
SECURITYHOLDERS LISTS AND REPORTS BY THE CORPORATION
AND THE TRUSTEE
SECTION 6.01. Securityholders Lists ..................... 22
SECTION 6.02. Preservation and Disclosure of Lists ...... 23
SECTION 6.03. Reports by the Corporation ................ 24
SECTION 6.04. Reports by the Trustee .................... 25
ARTICLE SEVEN
EVENTS OF DEFAULT; REMEDIES OF THE TRUSTEE AND
SECURITYHOLDERS
SECTION 7.01. Events of Default; Remedies .............. 27
SECTION 7.02. Payment of Securities on Default; Suit
Therefor ............................... 30
SECTION 7.03. Application of Moneys Collected by Trustee 32
SECTION 7.04. Proceedings by Securityholders ........... 33
SECTION 7.05. Proceedings by Trustee ................... 34
SECTION 7.06. Remedies Cumulative and Continuing ....... 34
SECTION 7.07. Direction of Proceedings and Waiver
Defaults by Majority of Securityholders 34
SECTION 7.08. Notice of Defaults ....................... 35
SECTION 7.09. Undertaking to Pay Costs ................. 35
iii
<PAGE>
ARTICLE EIGHT
CONCERNING THE TRUSTEE
Page
SECTION 8.01. Duties and Responsibilities of Trustee .. 36
SECTION 8.02. Reliance on Documents, Opinions, etc. ... 37
SECTION 8.03. No Responsibility for Recitals, etc. .... 39
SECTION 8.04. Trustee, Paying Agent or Registrar May
Own Securities ........................ 39
SECTION 8.05. Moneys to Be Held in Trust .............. 39
SECTION 8.06. Compensation and Expenses of Trustee .... 40
SECTION 8.07. Officers' Certificate as Evidence ....... 40
SECTION 8.08. Conflicting Interest of Trustee ......... 41
SECTION 8.09. Eligibility of Trustee .................. 47
SECTION 8.10. Resignation or Removal of Trustee ....... 48
SECTION 8.11. Acceptance by Successor Trustee ......... 49
SECTION 8.12. Succession by Merger, etc. .............. 51
SECTION 8.13. Limitation on Rights of Trustee as a
Creditor .............................. 52
ARTICLE NINE
CONCERNING THE SECURITYHOLDERS
SECTION 9.01. Action by Securityholders ............... 57
SECTION 9.02. Proof of Execution by Securityholders ... 57
SECTION 9.03. Who Are Deemed Absolute Owners .......... 57
SECTION 9.04. Corporation-Owned Securities Disregarded 58
SECTION 9.05. Revocation of Consents; Future Holders
Bound ................................. 59
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<PAGE>
ARTICLE TEN
SECURITYHOLDERS' MEETINGS
Page
SECTION 10.01. Purpose of Meetings ...................... 59
SECTION 10.02. Call of Meetings by Trustee .............. 60
SECTION 10.03. Call of Meeting by Corporation
Securityholders ......................... 60
SECTION 10.04. Qualifications for Voting ................ 60
SECTION 10.05. Regulations .............................. 61
SECTION 10.06. Voting ................................... 61
SECTION 10.07. Written Consent in Lieu of Meeting ....... 62
ARTICLE ELEVEN
SUPPLEMENTAL INDENTURES
SECTION 11.01. Supplemental Indentures Without Consent
of Securityholders ...................... 62
SECTION 11.02. Supplemental Indentures With Consent
of Securityholders ...................... 64
SECTION 11.03. Compliance with Trust Indenture Act;
Effect of Supplemental Indenture ........ 65
SECTION 11.04. Notation on Securities ................... 65
SECTION 11.05. Evidence of Compliance of Supplemental
Indenture to Be Furnished Trustee ....... 66
ARTICLE TWELVE
CONSOLIDATION, MERGER AND SALE
SECTION 12.01. Corporation May Consolidate, etc., on
Certain Terms ........................... 66
SECTION 12.02. Successor Corporation to Be Substituted .. 66
SECTION 12.03. Opinion of Counsel to Be Given Trustee ... 67
ARTICLE THIRTEEN
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 13.01. Discharge of Indenture ................... 68
SECTION 13.02. Deposited Moneys to Be Held in Trust
by Trustee .............................. 68
SECTION 13.03. Paying Agent to Repay Moneys Held ........ 69
SECTION 13.04. Return of Unclaimed Moneys ............... 69
v
<PAGE>
ARTICLE FOURTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
Page
SECTION 14.01. Indenture and Securities Solely Corporate
Obligations ............................. 69
ARTICLE FIFTEEN
SINKING FUNDS
SECTION 15.01. General .................................. 70
SECTION 15.02. Satisfaction of Sinking Fund Payments
with Securities ......................... 70
SECTION 15.03. Redemption of Securities for Sinking
Fund .................................... 70
ARTICLE SIXTEEN
MISCELLANEOUS PROVISIONS
SECTION 16.01. Provisions Binding on Corporation's
Successors .............................. 71
SECTION 16.02. Official Acts by Successor Corporation ... 71
SECTION 16.03. Addresses for Notices, etc. .............. 71
SECTION 16.04. Maryland Contract ........................ 72
SECTION 16.05. Evidence of Compliance with Conditions
Precedent ............................... 72
SECTION 16.06. Legal Holidays ........................... 72
SECTION 16.07. Trust Indenture Act to Control ........... 73
SECTION 16.08. Table of Contents, Headings, etc. ........ 73
SECTION 16.09. Execution in Counterparts ................ 73
TESTIMONIUM ............................................. 73
SIGNATURES ............................................. 73
vi
<PAGE>
THIS INDENTURE, dated as of April 4, 1997 between
CONSTELLATION ENERGY CORPORATION, a corporation duly organized
and existing under the laws of the State of Maryland and the
Commonwealth of Virginia (hereinafter sometimes called the
"Corporation"), and THE BANK OF NEW YORK, as Trustee, a
corporation duly organized and existing under the laws of the
State of New York (hereinafter sometimes called the "Trustee").
WITNESSETH:
WHEREAS, for its lawful corporate purposes, the Corporation
has duly authorized the issue of its unsecured debt securities
from time to time in series (all such series of debt securities
are herein collectively called the "Securities"), unlimited as to
principal amount and, to provide the terms and conditions upon
which the Securities are to be authenticated, issued and
delivered, the Corporation has duly authorized the execution and
delivery of this Indenture; and
WHEREAS, all acts and things necessary to constitute these
presents a valid agreement according to its terms have been done
and performed, and the execution and delivery of this Indenture
have in all respects been duly authorized, and the Corporation
proposes to do all acts and things necessary to make the
Securities, when executed by the Corporation and authenticated
and delivered by the Trustee, as in this Indenture provided, and
issued, the valid, binding and legal obligations of the
Corporation;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which
the Securities are, and are to be, authenticated, issued and
delivered, and in consideration of the premises and of the
purchase and acceptance of the Securities by the holders thereof,
the Corporation covenants and agrees with the Trustee for the
equal and proportionate benefit, except as otherwise expressly
provided in this Indenture, of the respective holders from time
to time of the Securities as follows:
<PAGE>
ARTICLE ONE
DEFINITIONS
SECTION 1.01. Definitions. The terms defined in this
Section 1.01 (except as herein otherwise expressly provided or
unless the context otherwise requires) for all purposes of this
Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section 1.01. All other
terms used in this Indenture which are defined in the Trust
Indenture Act of 1939 or which are by reference therein defined
in the Securities Act of 1933, as amended (except as herein
otherwise expressly provided or unless the context otherwise
requires), shall have the meanings assigned to such terms in said
Trust Indenture Act and in said Securities Act as in force at the
date of this Indenture as originally executed.
Board of Directors:
The term "Board of Directors" shall mean the Board of
Directors of the Corporation or any duly authorized committee of
such Board of Directors or any directors or officers of the
Corporation to whom such Board of Directors or such committee
shall have duly delegated its authority to act hereunder.
Board Resolution:
The term "Board Resolution" shall mean a resolution of the
Board of Directors or of any duly authorized committee of the
Board of Directors or the written declaration of any director or
officer of the Corporation to whom the Board of Directors or such
committee shall have duly delegated its authority to act with
respect to the matter covered by such declaration, a copy of
which has been certified by the Secretary or an Assistant
Secretary of the Corporation to have been duly adopted by the
Board of Directors, such committee, or such director or officer,
as the case may be, and to be in full force and effect on the
date of such certification, which certification shall, in the
case of any action taken by any such duly authorized committee,
director or officer, include a copy of the resolution or
resolutions of the Board of Directors, and/or committee thereof,
establishing the authority of the committee, director or officer
with respect to the action taken.
Business Day:
The term "business day" shall mean any day which is not a
Saturday or Sunday or a day on which banking institutions in the
2
<PAGE>
City of New York or the State of Maryland are authorized or
required by law or executive order to be closed.
Corporation:
The term "Corporation" shall mean CONSTELLATION ENERGY
CORPORATION, a Maryland and Virginia corporation, and subject to
the provisions of Article Twelve shall include its successors and
assigns.
Depositary
The term "Depositary" shall mean, with respect to the
Securities of any series issuable or issued in global form, the
person designated pursuant to Section 3.01(10) as the Depositary
with respect thereto or any successor appointed pursuant to
Section 3.04 of the Indenture.
Discounted Security:
The term "Discounted Security" shall mean any Security which
provides for an amount (excluding any amounts attributable to
accrued but unpaid interest thereon) less than the principal
amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof pursuant to Section 7.01.
Event of Default:
The term "Event of Default" shall mean any event specified
in Section 7.O1, continued for the period of time, if any, and
after the giving of the notice, if any, therein designated.
Federal Bankruptcy Code:
The term "Federal Bankruptcy Code" shall mean Title 11 of
the United States Code.
Indenture:
The term "Indenture" shall mean this instrument as
originally executed or, if amended or supplemented, as so amended
or supplemented, and shall include the form of each particular
series of Securities established as provided in Section 2.01.
0fficers' Certificate:
The term "Officers' Certificate", when used with respect to
the Corporation, shall mean a certificate signed by the Chairman
of the Board, Chief Executive Officer, Vice Chairman, President
or a Vice President of the Corporation and the Secretary, an
Assistant Secretary, the Treasurer or an Assistant Treasurer of
the Corporation. Each such certificate shall include the
3
<PAGE>
statements provided for in Section 16.05 if and to the extent
required by the provisions of such Section.
Opinion of Counsel:
The term "Opinion of Counsel" shall mean an opinion in
writing signed by legal counsel who may be an employee of the
Corporation or other counsel satisfactory to the Trustee. Each
such opinion shall include the statements provided for in Section
16.05 if and to the extent required by the provisions of such
Section.
Outstanding:
The term "outstanding", when used with reference to
Securities, shall, subject to the provisions of Section 9.04,
mean, as of any particular time, all Securities authenticated and
delivered by the Trustee under this Indenture, except:
(a) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(b) Securities or portions thereof, for the payment of
which moneys in the necessary amount shall have been
deposited in trust with the Trustee or with any paying agent
(other than the Corporation) or shall have been set aside
and segregated in trust by the Corporation (if the
Corporation shall act as its own paying agent); and
(c) Securities in lieu of or in substitution for which
other Securities shall have been authenticated and delivered
pursuant to the terms of Section 3.05, or which shall have
been paid, unless proof satisfactory to the Trustee is
presented that any such Securities are held by any person in
whose hands any of such Securities is a legal, valid and
binding obligation of the Corporation.
In determining whether the holders of the requisite principal
amount of outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder,
the principal amount of a Discounted Security shall be the amount
of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of
the maturity thereof pursuant to Section 7.01.
4
<PAGE>
Principal Office of the Trustee:
The term "Principal Office of the Trustee" or any other
similar term shall mean the principal office of the Trustee at
which at any particular time its corporate trust business shall
be administered, which office at the date of the execution of
this Indenture is located at 101 Barclay Street, Floor 21 West,
New York, New York 10286.
Prospectus:
The term "Prospectus" shall mean a prospectus, filed by the
Corporation with the Securities and Exchange Commission pursuant
to Rule 424(b) or (c) promulgated under the Securities Act of
1933, as amended, which sets forth the terms of the Securities
described therein.
Responsible Officer:
The term "Responsible Officer", when used with respect to
the Trustee, shall mean the chairman of the board of directors,
the president, the secretary, and the treasurer, or any other
officer of the Trustee in its corporate trust department.
Security or Securities:
The term "Security" or "Securities" shall mean any debt
security or debt securities, as the case may be, authenticated
and delivered under this Indenture in temporary or permanent form
and global or definitive form.
Securityholder:
The terms "Securityholder" or "holder of Securities" or
other similar terms, shall mean any person in whose name at the
time a particular Security is registered on the books of the
Corporation kept for that purpose in accordance with the terms
hereof.
Series:
The term "series" when used with respect to the Securities
shall mean all Securities described in a Board Resolution as
being part of any particular series.
Trustee:
The term "Trustee" shall mean THE BANK OF NEW YORK until a
successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee"
shall mean or include each Trustee which is then a Trustee
hereunder, and if at any time there is more than one such
5
<PAGE>
Trustee, "Trustee" as used with respect to the Securities of any
series shall mean the Trustee with respect to Securities of that
series.
Trust Indenture Act of 1939:
The term "Trust Indenture Act of 1939" shall mean the Trust
Indenture Act of 1939 as it was in force at the date of execution
of this Indenture, except as provided in Section 11.03.
Yield to Maturity:
The term "Yield to Maturity", when used with respect to any
Discounted Security shall mean the yield to maturity, if any, set
forth in the Prospectus relating thereto, which shall be equal to
the yield to maturity, if any, set forth on the face of such
Security.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Forms of Securities. The Securities shall be
in such form or forms as shall be established by or pursuant to a
Board Resolution, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or
permitted by this Indenture or any indenture supplemental hereto
and may have such letters, numbers or other marks of
identification and such legends or endorsements imprinted thereon
as the officers executing the same may approve (execution thereof
to be conclusive evidence of such approval).
Prior to the delivery of a Security in any such form to the
Trustee for authentication, the Corporation shall deliver to the
Trustee the following:
(1) a written order of the Corporation requesting the
Trustee's authentication and delivery of the securities;
(2) the Board Resolution by or pursuant to which such
form of Security has been approved, and, if a form of
security is to be approved by officer action pursuant to a
Board Resolution, an Officers' Certificate describing the
action taken;
(3) an Officers' Certificate dated the date such
certificate is delivered to the Trustee, stating that all
conditions precedent provided for in this Indenture relating
6
<PAGE>
to the authentication and delivery of Securities in such
form have been complied with; and
(4) an Opinion of Counsel stating that Securities in
such form when completed by appropriate insertions and
executed and delivered by the Corporation to the Trustee for
authentication in accordance with this Indenture,
authenticated and delivered by the Trustee in accordance
with this Indenture within the authorization as to aggregate
principal amount established from time to time by the Board
of Directors, and sold in the manner specified in such
Opinion of Counsel, will be the legal, valid and binding
obligations of the Corporation entitled to the benefits of
this Indenture, subject to applicable bankruptcy,
reorganization, insolvency and other similar laws generally
affecting creditors' rights, to general equitable principles
and to such other qualifications as, such counsel shall
conclude do not materially affect the rights of holders of
such Securities.
The definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods or
otherwise in any manner as determined by the officers executing
the same (execution thereof to be conclusive evidence of such
approval).
SECTION 2.02. Authentication Agent and Form of Certificate
of Authentication. The Corporation hereby appoints the Trustee as
an authentication agent for the Securities. The Corporation may
designate one or more additional authentication agent(s) for all
of the Securities or for one or more series of the Securities;
provided that the Trustee must consent in writing to such
designation.
The following shall be the form of Certificate of
Authentication provided by the Trustee or any authentication
agent.
This is one of the Securities of the series designated
herein issued under the Indenture described herein.
[NAME OF TRUSTEE OR AUTHENTICATION AGENT]
By _________________________
Authorized Signator
Dated:__________
7
<PAGE>
Section 2.03. Global Securities. If the Corporation shall
establish pursuant to Section 3.01(10) that the Securities of
all or part of a series are to be issued in whole or in part in
the form of a global Security, such global Security shall be
registered in the name of the Depositary for such global Security
or the nominee of such Depositary and shall be delivered by the
Trustee to such Depositary or pursuant to such Depositary's
instructions.
ARTICLE THREE
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND
EXCHANGE OF SECURITIES
SECTION 3.01. Title, Amount and Terms of Securities. The
aggregate principal amount of Securities which may be
authenticated and delivered and Outstanding under this Indenture
is not limited. The Securities may be issued in an aggregate
principal amount up to the aggregate principal amount of
Securities from time to time authorized by or pursuant to a Board
Resolution.
The Securities may be issued in one or more series, the
terms of each of which shall be determined in or pursuant to a
Board Resolution. With respect to each series of Securities, the
following terms shall be specified in the Board Resolution
relating thereto, or in an Officers' Certificate detailing any
actions taken pursuant to the Board Resolutions relating thereto:
(1) the title of the Securities of that series (which
shall distinguish the Securities of that series from
Securities of all other series);
(2) any limit upon the aggregate principal amount of
the Securities of that series which may be authenticated and
delivered under this Indenture (except for Securities
authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Securities of
that series pursuant to Section 3.04, 3.05, 3.06, 4.06 or
11.04);
(3) the date or rates on which the principal of the
Securities of that series is payable;
8
<PAGE>
(4) the rate or rates, or the method to be used in
establishing the rate or rates, at which the Securities of
that series shall bear interest (if any), the date or dates
from which such interest shall accrue, the interest payment
dates on which such interest shall be payable, the record
date for the interest payable on any interest payment date
and any other terms of payment of interest on the Securities
of that series;
(5) if other than as provided in this Indenture, the
place or places where the principal of (and premium, if any)
and interest, if any, on Securities of that series shall be
payable;
(6) the period or periods within which, the price or
prices at which and the terms and conditions upon which
Securities of that series may be redeemed, in whole or in
part, at the option of the Corporation, if such Securities
are to be subject to redemption;
(7) the obligation, if any, of the Corporation to
redeem or purchase Securities of that series pursuant to any
sinking fund or analogous provisions or at the option of a
holder thereof and the period or periods within which, the
price or prices at which and the terms and conditions upon
which Securities of that series shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any
integral multiple thereof are to be authorized. the
denominations in which Securities of that series shall be
issuable;
(9) if other than the principal amount thereof, the
portion of the principal amount of Securities of that series
which shall be payable upon a declaration of acceleration of
the maturity thereof pursuant to Section 7.01;
(10) if any of such Securities are to be issuable in
global form, (i) when any of such Securities are to be
issuable in global form; (ii) whether beneficial owners of
interests in any such global Security may exchange such
interests for Securities of the same series and of like
tenor and of any authorized form and denomination, and the
circumstances under which any such exchange may occur, if
9
<PAGE>
other than in the manner specified in Section 3.04 hereof,
and (iii) the name of the Depositary with respect to any
global Security, provided that a Depositary must, at the
time of its designation and at all times while it serves as
Depositary, be a clearing agency registered under the
Securities Exchange Act of 1934, as amended, and any other
applicable statute or regulation; and
(11) any other terms of that series.
SECTION 3.02. Denominations, Dates, Interest Payment and
Record Dates, and Place of Payment. In the absence of any
provision to the contrary with respect to the Securities of any
particular series. the Securities shall be issuable as registered
Securities without coupons in the denominations of $1,000 and any
multiple of $1,000. Every Security shall be dated the date of
its authentication and shall bear interest, if any, from the date
specified in the Board Resolution authorizing the issuance
thereof.
The person in whose name any Security is registered at the
close of business on any record date (as hereinafter in this
Section 3.02 defined) with respect to any interest payment date
shall be entitled to receive the interest payable on such
interest payment date notwithstanding the cancellation of such
Security upon any registration of transfer or exchange subsequent
to the record date and prior to such interest payment date;
provided, however, that if and to the extent the Corporation
shall default in the payment of the interest due on such interest
payment date, such defaulted interest shall be paid to the
persons in whose names outstanding Securities are registered at
the close of business on a subsequent record date established by
notice given by mail by or on behalf of the Corporation to the
holders of Securities not less than 15 days preceding such
subsequent record date, such record date to be not less than five
days preceding the date of payment of such defaulted interest.
As used in this Section 3.02, the term "record date" for the
interest payable on any Security on any interest payment date
(except a date for payment of defaulted interest) shall mean the
date, if any, specified in such Security as the "record date" for
the interest payable on such Security on any interest payment
date for such Security (except a date for payment of defaulted
interest on such Security).
10
<PAGE>
In the absence of any provision to the contrary with respect
to the Securities of any particular series, payment of principal
of (and premium, if any) and interest, if any, on the Securities
of all series shall be made at the Principal Office of the
Trustee, or at any agency to be maintained by the Corporation for
such purpose; provided, however, that payments of installments of
interest, if any, on such Securities may be made at the option of
the Corporation by check mailed to the addresses of the persons
entitled thereto as such addresses appear in the Security
register provided for in Section 3.04.
SECTION 3.03. Execution of Securities. The Securities shall
be signed in facsimile in the name and on behalf of the
Corporation by the Chief Executive Officer, Vice Chairman,
President or any Vice President of the Corporation, under its
corporate seal (which may be printed, engraved or otherwise
reproduced thereon, by facsimile or otherwise), attested by its
Secretary or an Assistant Secretary. Only such Securities as
shall bear thereon a certificate of authentication substantially
in the form set forth in Section 2.02, executed by the Trustee,
shall be entitled to the benefits of this Indenture or be valid
or obligatory for any purpose. Such certificate by the Trustee
upon any Security executed by the Corporation shall be conclusive
evidence that the Security so authenticated has been duly
authenticated and delivered hereunder and that the holder is
entitled to the benefits of this Indenture.
In case any officer of the Corporation who shall have signed
any of the Securities, shall cease to be such officer before the
Securities so signed shall have been authenticated and delivered
by the Trustee, or disposed of by the Corporation, such
Securities nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Securities had
not ceased to be such officer of the Corporation; and any
Security may be signed on behalf of the Corporation by such
persons as, at the actual date of the execution of such Security
shall be the proper officers of the Corporation, although at the
date of the execution of this Indenture any such person was not
such an officer.
SECTION 3.04. Exchange and Registration of Transfer of
Securities. Securities of any series may be exchanged for an
equal aggregate principal amount of Securities of other
authorized denominations of the same series. Securities to be
exchanged shall be surrendered at the Principal Office of the
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<PAGE>
Trustee or at any agency to be maintained by the Corporation for
such purpose, as provided in Section 5.02, and the Corporation
shall execute and register, and the Trustee shall authenticate
and deliver in exchange therefor the Security or Securities which
the Securityholder making the exchange shall be entitled to
receive.
The Corporation shall keep at the Principal Office of the
Trustee a register in which, subject to such reasonable
regulations as it may prescribe, the Corporation shall provide
for registration of Securities and registration of transfers of
Securities as in this Article Three provided. Such register
shall be in written form or in any other form capable of being
converted into written form within a reasonable time. At all
reasonable times such register shall be open for inspection by
the Trustee and the Corporation. The Trustee is hereby appointed
Security registrar for the purpose of registering Securities and
registering the transfers of Securities as herein provided. Upon
due presentment for registration of transfer of any Security of a
particular series at such office or agency and compliance in full
with the conditions of this Section 3.04, the Corporation shall
execute, the Security registrar shall register, and the Trustee
shall authenticate and deliver in the name of the transferee or
transferees a new Security or Securities of the same series for
an equal aggregate principal amount.
All Securities presented for registration of transfer or for
exchange or payment shall (if so required by the Corporation or
the Security registrar) be duly endorsed by, or be accompanied by
a written instrument or instruments of transfer in form
satisfactory to the Corporation and the Security registrar duly
executed by, the holder or his attorney duly authorized in
writing.
No service charge shall be made for any exchange or
registration of transfer of Securities, but the Corporation may
require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection therewith.
Unless otherwise specified with respect to the Securities of
a specific series as contemplated by Section 3.01(10), if at any
time a Depositary for any Securities of a series issued in global
form notifies the Corporation that it is unwilling or unable to
continue as Depositary for such Securities or if at any time a
Depositary for any Securities of such series issued in global
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form shall no longer be eligible under the last clause of Section
3.01(10), the Corporation shall appoint a successor Depositary
with respect to the Securities of such series. If a successor
Depositary for such Securities is not appointed by the
Corporation within 90 calendar days after the Corporation
receives such notice or becomes aware of such ineligibility, or
if an Event of Default with respect to such Securities has
occurred and is continuing, such Securities shall,
notwithstanding the terms of the Securities of such series
established pursuant to Section 3.01(10), no longer be issued in
global form and the Corporation will execute, and the Trustee,
upon receipt of the Corporation's written order for the
authentication and delivery of definitive Securities of such
series, will authenticate and deliver, in exchange for such
global Security from the Depositary, Securities of such series in
definitive form in authorized denominations, in an aggregate
principal amount equal to the principal amount of each global
Security previously delivered to such Depositary and having like
terms and conditions.
The Corporation may at any time and in its sole discretion
determine that the Securities of any series issued in the form of
a global Security shall no longer be represented by such global
Security. In such event the Corporation will execute, and the
Trustee, upon receipt of the Corporation's written order for the
authentication and delivery of definitive Securities of such
series, will authenticated and deliver, in exchange for such
global Security, Securities of such series in definitive form in
authorized denominations, in an aggregate principal amount equal
to the principal amount of the Securities no longer to be
represented by such global Security and having like terms and
conditions.
If specified by the Corporation with respect to a
series of Securities pursuant to Section 3.01(10), the Depositary
for any Securities of such series represented by a global
Security may surrender such global Security in exchange in whole
or in part for definitive Securities of such series having like
terms and conditions and in definitive form on such terms as are
acceptable to the Corporation and such Depositary. At such
Depositary's request the Corporation shall thereupon execute, and
the Trustee shall authenticate and deliver, (i) to each person
specified by such Depositary a new definitive Security or
Securities of the same series, having like terms and conditions
and in any authorized denomination as requested by such person in
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aggregate principal amount equal to and in exchange for such
person's beneficial interest in the global Security so
surrendered and (ii) to such Depositary a new global Security
which is of like terms and conditions and in a denomination equal
to the difference, if any, between the principal amount of the
surrendered global Security and the aggregate principal amount of
definitive Securities delivered to each such person as provided
in clause(i).
Such Securities in definitive form issued pursuant to the
preceding paragraphs of this Section 3.04 shall be registered in
such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants, or otherwise, shall instruct the Corporation.
After authentication, the Trustee shall deliver such definitive
Securities to the persons in whose names such Securities are so
registered.
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen
Securities. In case any temporary or permanent Security shall
become mutilated or be destroyed, lost or stolen, the Corporation
in its discretion may execute, and upon its request the Trustee
shall authenticate and deliver, a new Security of the same
series, bearing a number not contemporaneously outstanding, in
exchange and substitution for the mutilated Security, or in lieu
of and in substitution for the Security so destroyed, lost or
stolen. In every case the applicant for a substituted Security
shall furnish to the Corporation, to the Security registrar, any
paying agent and to the Trustee such security or indemnity as may
be required by them to save each of them harmless, and, in every
case of destruction, loss or theft, the applicant shall also
furnish to the Corporation, to the Security registrar, to any
paying agent and to the Trustee evidence to their satisfaction of
the destruction, loss or theft of such Security and of the
ownership thereof.
The Trustee may authenticate any substituted Security and
deliver the same upon the written request or authorization of any
officer of the Corporation. Upon the issuance of any substituted
Security, the Corporation may require the payment of a sum
sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other expenses, including
counsel fees of the Corporation, the Trustee, any paying agent or
Security registrar connected therewith. In case any Security
which has matured or is about to mature shall become mutilated or
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be destroyed, lost or stolen, the Corporation may, instead of
issuing a substitute Security, pay or authorize the payment of
the same (without surrender thereof except in the case of a
mutilated Security) if the applicant for such payment shall
furnish to the Corporation, to the Security registrar, any paying
agent and to the Trustee such security or indemnity as may be
required by them to save each of them harmless and, in case of
destruction, loss or theft, evidence satisfactory to the
Corporation, the Security registrar and the Trustee of the
destruction, loss or theft of such Security and of the ownership
thereof.
Every substituted Security issued pursuant to the provisions
of this Section 3.05 by virtue of the fact that any Security is
destroyed, lost or stolen shall constitute an additional
contractual obligation of the Corporation, whether or not the
destroyed, lost or stolen Security shall be enforceable at any
time, and shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Securities
duly issued hereunder. All Securities shall be held and owned
upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities and shall
preclude to the extent permitted by law any and all other rights
or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement
or payment of negotiable instruments or other securities without
their surrender.
SECTION 3.06. Temporary Securities. Pending the preparation
of permanent Securities of any series, the Corporation may
execute and the Trustee shall authenticate and deliver temporary
Securities (printed or lithographed) of such series. Temporary
Securities of any series shall be issuable in any authorized
denomination, and substantially in the form of the permanent
Securities of such series, but with such omissions, insertions
and variations as may be appropriate for temporary Securities of
such series, all as may be determined by the Corporation. Every
such temporary Security shall be authenticated by the Trustee
upon the same conditions and in substantially the same manner,
and with the same effect, as the permanent Securities of such
series. Without unreasonable delay the Corporation will execute
and deliver to the Trustee permanent Securities of such series
and thereupon any or all temporary Securities of such series may
be surrendered in exchange therefor at the Principal Office of
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the Trustee or at any agency to be maintained by the Corporation
for such purpose as provided in Section 5.02, and the Trustee
shall authenticate and deliver in exchange for such temporary
Securities an equal aggregate principal amount of permanent
Securities of such series. Such exchange shall be made by the
Corporation at its own expense and without any charge therefor
except that the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto. Until so exchanged, the
temporary Securities of any series shall in all respects be
entitled to the same benefits under, and be subject to the terms
and conditions of, this Indenture as permanent Securities of the
same series authenticated and delivered hereunder.
SECTION 3.07. Cancellation of Securities Paid, etc. All
Securities surrendered for the purpose of payment, exchange or
registration of transfer shall, if surrendered to the Corporation
or any agent for exchange and registration of transfer, be
surrendered to the Trustee for cancellation and promptly
cancelled by it, or, if surrendered to the Trustee, shall be
promptly cancelled by it, and no Securities shall be issued in
lieu thereof except as expressly permitted by any of the
provisions of this Indenture. The Trustee shall destroy
cancelled Securities and deliver a certificate of such
destruction to the Corporation. If the Corporation shall acquire
any of the Securities, however, such acquisition shall not
operate as a satisfaction of the indebtedness represented by such
Securities unless and until the same are surrendered to the
Trustee for cancellation.
ARTICLE FOUR
REDEMPTION OF SECURITIES
SECTION 4.01. Applicability of This Article. Redemption of
Securities (whether by operation of a sinking fund or otherwise)
as permitted or required by any form of Security issued pursuant
to this Indenture shall be made in accordance with such form of
Security and this Article; provided, however, that if any
provision of any such form of Security shall conflict with any
provision of this Article, the provision of such form of Security
shall govern. Except as otherwise set forth in the form of
Security for such series, each Security shall be subject to
partial redemption only in the amount of $1,000 or integral
multiples of $1,000.
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SECTION 4.02. Election to Redeem: Notice to Trustee. The
election of the Corporation to redeem any Securities shall be
evidenced by or pursuant to a Board Resolution. In case of any
redemption at the election of the Corporation of less than all of
the Securities of any particular series, the Corporation shall,
at least 45 days prior to the date fixed for redemption (unless a
shorter notice shall be satisfactory to the Trustee) notify the
Trustee of such date and of the principal amount of Securities of
that series to be redeemed.
SECTION 4.03. Selection of Securities to be Redeemed. If
less than all the Securities of a particular series are to be
redeemed, the Trustee shall select, in such manner as in its sole
discretion it shall deem appropriate and fair, the Securities or
portions thereof of such series to be redeemed. The Trustee
shall promptly notify the Corporation in writing of the
Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount
thereof to be redeemed. For all purposes of this Indenture,
unless the context otherwise requires, all provisions relating to
the redemption of Securities shall relate, in the case of any
Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to
be redeemed.
SECTION 4.04. Notice of Redemption. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not
later than the thirtieth day, and not earlier than the sixtieth
day, prior to the date fixed for redemption, to each holder of
Securities to be redeemed, at his address as it appears on the
registry books of the Corporation.
With respect to Securities of each series to be redeemed,
each notice of redemption shall state:
(1) the date fixed for redemption for Securities of
such series;
(2) the redemption price at which Securities of such
series are to be redeemed;
(3) if less than all outstanding Securities of such
particular series are to be redeemed, the identification
(and, in the case of partial redemption, the respective
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principal amounts) of the particular Securities to be
redeemed;
(4) that on the date fixed for redemption, the
redemption price at which such Securities are to be redeemed
will become due and payable upon each such Security or
portion thereof, and that interest thereon, if any, shall
cease to accrue on and after said date;
(5) the place or places where such Securities are to
be surrendered for payment of the redemption price at which
such Securities are to be redeemed; and
(6) that the redemption is for a sinking fund, if such
is the case.
Notice of redemption of Securities to be redeemed at the
election of the Corporation shall be given by the Corporation or,
at the Corporation's request, by the Trustee in the name and at
the expense of the Corporation. The notice if mailed in the
manner herein provided shall be conclusively presumed to have
been duly given, whether or not the holder receives such notice.
In any case, a failure to give such notice by mail or any defect
in the notice to the holder of any Security designated for
redemption as a whole or in part shall not affect the validity of
the proceedings for the redemption of any other Security.
SECTION 4.05. Deposit of Redemption Price. Prior to or on
the redemption date specified in the notice of redemption given
as provided in Section 4.04, the Corporation will deposit with
the Trustee or with one or more paying agents an amount of money
sufficient to redeem on the redemption date all the Securities so
called for redemption at the applicable redemption price.
SECTION 4.06. Payment of Securities Called for Redemption.
If any notice of redemption has been given as provided in Section
4.04, the Securities or portions of Securities with respect to
which such notice has been given shall become due and payable on
the date and at the place or places stated in such notice at the
applicable redemption price. On presentation and surrender of
such Securities at a place of payment in said notice specified,
the said Securities or the specified portions thereof shall be
paid and redeemed by the Corporation at the applicable redemption
price.
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Upon presentation of any Security redeemed in part only, the
Corporation shall execute and the Trustee shall authenticate and
deliver to the holder thereof, at the expense of the Corporation,
a new Security or Securities of the same series, of authorized
denominations. in aggregate principal amount equal to the
unredeemed portion of the Security so presented.
Section 4.07. Delegation of Duties by Trustee. Except in
regard to Section 4.03, any reference in this Article to the
Trustee with respect to its duties in regard to the redemption of
any Securities shall be deemed to also include any entity
designated by the Corporation with the consent of the Trustee to
act as its agent for the performance of all or any of its duties
under this Article.
ARTICLE FIVE
PARTICULAR COVENANTS OF THE CORPORATION
SECTION 5.01. To Pay Principal (and Premium if any) and
Interest. The Corporation will duly and punctually pay, or cause
to be paid, the principal of (and premium, if any) and interest,
if any, on each and every Security at the times and place and in
the manner provided herein and in such Securities. Interest upon
Securities shall be payable without presentment of such
Securities, and only to or upon the written order of the
registered holders thereof determined as provided in Section
3.02. The Corporation shall have the right to require a
Securityholder, in connection with the payment of the principal
of (and premium, if any) or interest, if any, on a Security, to
present at the office or agency of the Corporation at which such
payment is made a certificate, in such form as the Corporation
may from time to time prescribe, to enable the Corporation to
determine its duties and liabilities with respect to any taxes,
assessments or governmental charges which it may be required to
deduct or withhold therefrom under any present or future law of
the United States of America or of any state, county,
municipality or taxing or withholding authority therein, and the
Corporation shall be entitled to determine its duties and
liabilities with respect to such deduction or withholding on the
basis of information contained in such certificate or, if no such
certificate shall be so presented, on the basis of any
presumption created by any such law, and shall be entitled to act
in accordance with such determination.
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SECTION 5.02. To Maintain Office or Agency. So long as any
Securities remain outstanding, the Corporation will maintain an
office or agency where the Securities may be presented for
payment, where the Securities may be presented for registration
of transfer and exchange as in this Indenture provided and where
notices or demands to or upon the Corporation in respect of the
Securities or of this Indenture may be served. The Corporation
hereby initially appoints the Trustee as its agent for all such
purposes until otherwise designated by the Corporation in a
written notice to the Trustee, the office or agency for all such
purposes shall be the Principal Office of the Trustee. In case
the Corporation shall at any time designate a different office or
agency for such purposes, but shall fail to maintain such office
or agency, or shall fail to give notice to the Trustee of any
change in the location thereof, presentation and demand may be
made and notices may be served, in respect of the Securities or
of this Indenture, at the Principal Office of the Trustee, and
the Corporation hereby appoints the Trustee its agent to receive
all such presentations, surrenders, notices and demands.
In addition to any such office or agency the Corporation may
from time to time constitute and appoint one or more paying
agents for the payment of such Securities, in one or more other
cities, and may from time to time rescind such appointments, as
the Corporation may deem desirable or expedient.
SECTION 5.03. To Fill a Vacancy in the Office of Trustee.
The Corporation, whenever necessary to avoid or fill a vacancy in
the office of Trustee, will appoint, in the manner provided in
Article Eight, a Trustee, so that there shall at all times be a
Trustee hereunder.
SECTION 5.04. Appointment of Paying Agents; Money for
Security Payments to Be Set Aside in Trust; Transfer or Moneys
Held by Paying Agents. (a) If as to any series of Securities, the
Corporation shall appoint a paying agent other than the Trustee,
it will cause such paying agent to execute and deliver to the
Trustee an instrument in which such paying agent shall agree with
the Trustee, subject to the provisions of this Section 5.04:
(1) that it will hold all sums held by it as such
paying agent for the payment of the principal of (and
premium, if any) or interest, if any, on such Securities in
trust for the benefit of the holders of the Securities
entitled thereto, or for the benefit of the Trustee, as the
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case may be, until such sums shall be paid out to such
holders or otherwise as herein provided;
(2) that it will give the Trustee notice of any
failure by the Corporation in the making of any deposit with
such paying agent for the payment of principal of (and
premium, if any) or interest, if any, on such Securities
which shall have become payable and of any default by the
Corporation in making any payment of the principal of (and
premium, if any) or interest on such Securities when the
same shall be due and payable, and
(3) that it will at any time during the continuance of
any such default, upon the written request of the Trustee,
forthwith pay to the Trustee all sums so held in trust by
such paying agent.
(b) If the Corporation shall act as its own paying agent as
to any series of Securities, it will, on or before each due date
of the principal of (and premium, if any) or interest, if any, on
such Securities, set aside and hold in trust for the benefit of
the holders of such Securities entitled thereto a sum sufficient
(together with any sums deposited with any other paying agent for
such purpose) to pay such principal (and premium, if any) or
interest, if any, so becoming due and will notify the Trustee of
any, failure by it to take such action. Whenever the Corporation
shall have one or more paying agents with respect to any
particular series of Securities, it will, on or before each due
date of the principal of (and premium, if any) or interest if
any, on the Securities, deposit with a paying agent a sum
sufficient to pay such principal (and premium, if any) or
interest so becoming due, such sums to be held in trust for the
benefit of the holders of such Securities entitled thereto, and
(unless the paying agent is the Trustee) the Corporation will
notify the Trustee of failure by it to take such action.
(c) Anything in this Section 5.04 to the contrary
notwithstanding, the Corporation may at any time, for the purpose
of obtaining the satisfaction and discharge of this Indenture, or
for any other purpose, pay or cause to be paid to the Trustee all
sums held in trust by the Corporation or any paying agent as
required by this Section 5.04, such sums to be held by the
Trustee upon the trusts herein contained.
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(d) Anything in this Section 5.04 to the contrary
notwithstanding, the agreement to hold sums in trust as provided
in this Section 5.04 is subject to the provisions of Sections
13.03 and 13.04.
SECTION 5.05. Maintenance of Corporate Existence, Rights and
Franchises. So long as any of the Securities shall be
outstanding, the Corporation will do or cause to be done all
things necessary to preserve and keep in full force and effect
its corporate existence, rights and franchises to carry on its
business; provided that nothing in this Section 5.05 shall
prevent (i) any consolidation or merger of the Corporation, or
any sale or conveyance of all or substantially all its property
and assets, permitted by Article Twelve, or (ii) the liquidation
or dissolution of the Corporation after a sale or conveyance of
all or substantially all its property and assets permitted by
Article Twelve.
SECTION 5.06. Certificate as to No Default. The Corporation
hereby agrees to deliver to the Trustee, within 120 days after
the end of each fiscal year of the Corporation, commencing with
the fiscal year ending December 31, 1997, an Officers'
Certificate, which need not comply with the provisions of Section
16.05, to the effect that, to the knowledge of the signers
thereof, the Corporation is not in default under any provision of
this Indenture or, if such signers have knowledge of any such
default, stating the same and the nature and status thereof.
ARTICLE SIX
SECURITYHOLDERS LISTS AND REPORTS BY THE CORPORATION
AND THE TRUSTEE
SECTION 6.01. Securityholder Lists. The Corporation covenants
and agrees that, with respect to each series of Securities. it
will furnish or cause to be furnished to the Trustee, (a)
semiannually, not less than 45 days nor more than 60 days after
(i) each record date for the payment of interest on any interest
payment date (except a date for payment of defaulted interest) in
the case of interest-bearing Securities or (ii) the last business
day of each June and December in the case of non-interest-bearing
Securities, and (b) at such other times as the Trustee may
request in writing, within 30 days after receipt by the
Corporation of any such request, a list in such form as the
Trustee may reasonably require of the names and addresses of the
holders of Securities of such series as of a date not more than
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15 days prior to the time such information is furnished;
provided, however, that if the Trustee shall be the Security
registrar, such list shall not be required to be furnished.
SECTION 6.02. Preservation and Disclosure of Lists. (a) The
Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the
holders of Securities contained in the most recent list furnished
to it as provided in Section 6.01 and received by the Trustee in
its capacity as Security registrar or paying agent if so acting.
The Trustee may destroy any list furnished to it as provided in
Section 6.01 upon receipt of a new list so furnished.
(b) In case three or more holders of Securities of any
series (hereinafter referred to as "applicants") apply in writing
to the Trustee and furnish to the Trustee reasonable proof that
each such applicant has owned a Security of such series for a
period of at least six months preceding the date of such
application, and such application states that the applicants
desire to communicate with other holders of Securities of such
series with respect to their rights under this Indenture or under
the Securities of such series and is accompanied by a copy of the
form of proxy or other communication which such applicants
propose to transmit, then the Trustee shall, within five business
days after the receipt of such application, at its election,
either
(1) afford such applicants access to the information
preserved at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 6.02, or
(2) inform such applicants as to the approximate
number of holders of Securities of such series whose names
and addresses appear in the information preserved at the
time by the Trustee in accordance with the provisions of
subsection (a) of this Section 6.02, and as to the
approximate cost of mailing to such Securityholders the form
of proxy or other communication, if any, specified in such
application.
If the Trustee shall elect not to afford such applicants
access to such information, the Trustee shall, upon the written
request of such applicants, mail to each holder of Securities of
such series whose name and address appears in the information
preserved at the time by the Trustee in accordance with the
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provisions of subsection (a) of this Section 6.02 a copy of the
form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Trustee
of the material to be mailed and of payment, or provision for the
payment, of the reasonable expenses of mailing, unless within
five days after such tender, the Trustee shall mail to such
applicants and file with the Securities and Exchange Commission,
together with a copy of the material to be mailed, a written
statement to the effect that, in the opinion of the Trustee, such
mailing would be contrary to the best interests of the holders of
Securities of such series or would be in violation of applicable
law. Such written statement shall specify the basis of such
opinion. If said Commission, after opportunity for a hearing
upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections
or if after the entry of an order sustaining one or more of such
objections, said Commission shall find, after notice and
opportunity for hearing, that all the objections so sustained
have been met and shall enter an order so declaring, the Trustee
shall mail copies of such material to all such Securityholders
with reasonable promptness after the entry of such order and the
renewal of such tender; otherwise, the Trustee shall be relieved
of any obligation or duty to such applicants respecting their
application.
(c) Each and every holder of the Securities, by receiving
and holding the same, agrees with the Corporation and the Trustee
that neither the Corporation nor the Trustee nor any paying agent
nor any Security registrar shall be held accountable by reason of
the disclosure of any such information as to the names and
addresses of the holders of Securities in accordance with the
provisions of subsection (b) of this Section 6.02, regardless of
the source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing any
material pursuant to a request made under said subsection (b).
SECTION 6.03. Reports by the Corporation. (a) The
Corporation covenants and agrees to file with the Trustee within
30 days after the Corporation is required to file the same with
the Securities and Exchange Commission, copies of the annual
reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as said
Commission may from time to time by rules and regulations
prescribe) which the Corporation may be required to file with
said Commission pursuant to section 13 or section 15(d) of the
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Securities Exchange Act of 1934, as amended; or, if the
Corporation is not required to file information, documents or
reports pursuant to either of such sections, then to file with
the Trustee and said Commission, in accordance with rules and
regulations prescribed from time to time by said Commission. such
of the supplementary and periodic information, documents and
reports which may be required pursuant to section 13 of the
Securities Exchange Act of 1934, as amended, in respect of a
security listed and registered on a national securities exchange
as may be prescribed from time to time in such rules and
regulations.
(b) The Corporation covenants and agrees to file with the
Trustee and the Securities and Exchange Commission, in accordance
with the rules and regulations prescribed from time to time by
said Commission, such additional information, documents and
reports with respect to compliance by the Corporation with the
conditions and covenants provided for in this Indenture as may be
required from time to time by such rules and regulations.
(c) The Corporation covenants and agrees to transmit by
mail to all holders of Securities, as the names and addresses of
such holders appear upon the registry books of the Corporation,
within 30 days after the filing thereof with the Trustee, such
summaries of any information, documents and reports required to
be filed by the Corporation pursuant to subsection (a) or (b) of
this Section 6.03 as may be required by rules and regulations
prescribed from time to time by the Securities and Exchange
Commission.
SECTION 6.04. Reports by the Trustee. (a) On or before
October 1, 1997, and on or before October 1 in every year
thereafter, so long as any Securities are outstanding hereunder,
the Trustee shall transmit to the Securityholders for which it is
acting as Trustee, as hereinafter in this Section 6.04 provided,
a brief report dated as of the preceding September 1 with respect
to:
(1) its eligibility under Section 8.09, and its
qualification under Section 8.08, or in lieu thereof, if to
the best of its knowledge it has continued to be eligible
and qualified under such Sections, a written statement to
such effect;
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(2) the character and amount of any advances (and if
the Trustee elects so to state, the circumstances
surrounding the making thereof) made by the Trustee (as
such) which remain unpaid on the date of such report, and
for the reimbursement of which it claims or may claim a lien
or charge, prior to that of the Securities with respect to
which it is acting as Trustee, on any property or funds held
or collected by it as Trustee, except that the Trustee shall
not be required (but may elect) to state such advances if
such advances so remaining unpaid aggregate not more than
one-half of one percent of the principal amount of such
Securities outstanding on the date of such report;
(3) the amount, interest rate, and the maturity date
of all other indebtedness owing by the Corporation (or by
any other obligor on such Securities) to the Trustee in its
individual capacity, on the date of such report, with a
brief description of any property held as collateral
security therefor, except an indebtedness based upon a
creditor relationship arising in any manner described in
paragraph (2), (3), (4) or (6) of subsection (b) of Section
8.13;
(4) the property and funds, if any, physically in the
possession of the Trustee, as such, at the date of such
report;
(5) any additional issue of Securities with respect to
which it is acting as Trustee which it has not previously
reported; and
(6) any action taken by the Trustee in the performance
of its duties under this Indenture which it has not
previously reported and which in its opinion materially
affects such Securities, except action in respect of a
default, notice of which has been or is to be withheld by it
in accordance with the provisions of Section 7.08.
(b) The Trustee shall transmit to the Securityholders with
respect to which it is acting as Trustee, as hereinafter
provided, a brief report with respect to the character and amount
of any advances (and if the Trustee elects so to state, the
circumstances surrounding the making thereof) made by the Trustee
(as such), since the date of the last report transmitted pursuant
to the provisions of subsection (a) of this Section 6.04 (or, if
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no such report has yet been so transmitted, since the date of
execution of this Indenture), for the reimbursement of which it
claims or may claim a lien or charge prior to that of the
Securities with respect to which it is acting as Trustee on
property or funds held or collected by it as Trustee, and which
it has not previously reported pursuant to this subsection,
except that the Trustee shall not be required (but may elect) to
report such advances if such advances remaining unpaid at any
time aggregate ten percent or less of the principal amount of
such Securities outstanding at such time, such report to be
transmitted within ninety days after such time.
(c) Reports pursuant to this Section 6.04 shall be
transmitted by first class mail, postage prepaid to all holders
of Securities as the names and addresses of such holders appear
upon the registry books of the Corporation.
(d) A copy of each such report shall, at the time of such
transmission to Securityholders, be filed by the Trustee with
each stock exchange upon which the Securities with respect to
which it is acting as Trustee are listed and also with the
Securities and Exchange Commission. The Corporation will notify
the Trustee when and as such Securities become listed on any
stock exchange.
ARTICLE SEVEN
EVENTS OF DEFAULT: REMEDIES OF THE TRUSTEE
AND SECURITYHOLDERS
SECTION 7.01. Events of Default; Remedies. The occurrence
of any of the following events shall constitute an Event of
Default hereunder with respect to any particular series of
Securities:
(a) default in the due and punctual payment of any
installments of interest upon any of the Securities of that
series as and when the same shall become due and payable and
continuance of such default for a period of 30 days: or
(b) default in the due and punctual payment of the
principal of (or premium, if any, on) any of the Securities
of that series as and when the same shall become due and
payable either at maturity, by declaration as authorized by
this Indenture, or otherwise; or
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(c) failure on the part of the Corporation duly to
observe or perform any other of the covenants or agreements
on the part of the Corporation set forth in the Securities
of that series or in this Indenture (other than those set
forth exclusively in the terms of Securities of any series
other than that series) continued for a period of sixty days
after there has been given, by registered or certified mail,
to the Corporation by the Trustee, or to the Corporation and
the Trustee by the holders of at least thirty-three percent
in principal amount of the Securities of that series at the
time outstanding, a written notice specifying such failure
and requiring the same to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(d) the entry of a decree or order by a court having
jurisdiction in the premises granting relief in respect of
the Corporation in an involuntary case under the Federal
Bankruptcy Code adjudging the Corporation a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or
in respect of the Corporation under the Federal Bankruptcy
Code or any other applicable Federal or State law, or
appointing a receiver, liquidator, custodian, assignee,
trustee, sequestrator (or other similar official) of the
Corporation, or of any substantial part of the respective
properties of either, or ordering the winding up or
liquidation of the affairs of either, and the continuance of
any such decree or order unstayed and in effect for a period
of 120 days; or
(e) the institution by the Corporation of proceedings
to be adjudicated a bankrupt or insolvent, or the consent by
the Corporation to the institution of bankruptcy or
insolvency proceedings against it, or the filing by the
Corporation of a petition or answer or consent seeking
reorganization or relief under the Federal Bankruptcy Code
or any other applicable Federal or State law, or the consent
by the Corporation to the filing of any such petition or to
the appointment of a receiver, liquidator, custodian,
assignee, trustee, sequestrator (or other similar official)
of the Corporation, or of any substantial part of the
respective properties of either, or the making by the
Corporation of an assignment for the benefit of creditors,
or the admission by the Corporation in writing of its
inability to pay its debts generally as they become due, or
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the taking of corporate action by the Corporation in
furtherance of any such action.
In case one or more of the Events of Default specified above
shall have occurred and be continuing with respect to any
particular series of Securities, then and in each and every such
case, unless the principal of all of the Securities of that
series shall have already become due and payable, either the
Trustee or the holders of not less than thirty-three percent in
aggregate principal amount of the Securities of that series then
outstanding hereunder, by notice in writing to the Corporation
(and to the Trustee if given by Securityholders), may declare the
principal or, in the case of Discounted Securities, such amount
of principal as may be provided for in such Securities, of all
the Securities of that series to be due and payable immediately,
and upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the
Securities of that series contained to the contrary
notwithstanding. This provision, however, is subject to the
condition that if, at any time after such principal or such
amount of principal, as the case may be, shall have been so
declared due and payable, and before any judgment or decree for
the payment of the moneys due shall have been obtained or entered
as hereinafter provided, the Corporation shall pay or shall
deposit with the Trustee a sum sufficient to pay all matured
installments of interest upon all Securities of that series and
the principal of (and premium, if any, on) any and all Securities
of that series which shall have become due otherwise than by
acceleration (with interest on overdue installments of interest
(to the extent that payment of such interest is enforceable under
applicable law) and on such principal (and premium, if any) at
the rate of interest (or, in the case of Discounted Securities,
at the Yield to Maturity) borne by such Securities, to the date
of such payment or deposit) and the expenses of the Trustee, and
any and all defaults under this Indenture with respect to the
Securities of the series, other than the nonpayment of principal
of (and premium, if any) and accrued interest on the Securities
of that series which shall have become due by acceleration shall
have been remedied-then and in every such case the holder of a
majority in aggregate principal amount of the Securities of that
series then outstanding, by written notice to the Corporation and
to the Trustee, may waive all defaults and rescind and annul such
declaration and its consequences; but no such waiver or
rescission and annulment shall extend to or shall affect any
subsequent default, or shall impair any right consequent thereon.
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In case the Trustee shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been
discontinued or abandoned for any reason or shall have been
determined adversely to the Trustee, then and in every such case
the Corporation and the Trustee shall be restored respectively to
their several positions and rights hereunder, and all rights,
remedies and powers of the Corporation and the Trustee shall
continue as though no such proceeding had been taken.
SECTION 7.02. Payment of Securities on Default; Suit
Therefor. The Corporation covenants that (a) in case default
shall be made in the payment of any installment of interest upon
any of the Securities of any series as and when the same shall
become due and payable, and such default shall have continued for
a period of thirty days, or (b) in case default shall be made in
the payment of the principal of (or premium, if any, on) any of
the Securities of any series as and when the same shall have
become due and payable, whether at maturity of the Securities of
that series or by declaration or otherwise, then, upon demand of
the Trustee, the Corporation will pay to the Trustee, for the
benefit of the holders of such Securities, the whole amount that
then shall have become due and payable on all such Securities for
principal (and premium, if any) or interest, if any, with
interest upon the overdue principal (and premium, if any) and (to
the extent that payment of such interest is enforceable under
applicable law) upon the overdue installments of interest at the
rate of interest (or the Yield to Maturity in the case of
Discounted Securities) borne by the Securities of that series;
and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection,
including reasonable compensation to the Trustee, its agents,
attorneys and counsel, and any expenses or liabilities incurred,
and all advances made, by the Trustee hereunder other than
through its negligence or bad faith.
In case the Corporation shall fail forthwith to pay such
amounts upon such demand, the Trustee, in its own name and as
trustee of an express trust, shall be entitled and empowered to
institute any actions or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Corporation
or any other obligor on such Securities and collect in the manner
provided by law out of the property of the Corporation or any
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other obligor on such Securities wherever situated the moneys
adjudged or decreed to be payable.
In case there shall be pending proceedings for the
bankruptcy or for the reorganization of the Corporation or any
other obligor on the Securities of any series under the Federal
Bankruptcy Code or any other applicable law, or in case a
receiver, custodian or trustee shall have been appointed for the
property of the Corporation or such other obligor, or in the case
of any similar judicial proceedings relative to the Corporation
or other obligor upon such Securities, or to the creditors or
property of the Corporation or such other obligor, the Trustee,
irrespective of whether the principal of such Securities shall
then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made
any demand pursuant to the provisions of this Section 7.02, shall
be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims, for the whole
amount of principal (and premium, if any) and interest, if any
owing and unpaid in respect of such Securities, and in case of
any judicial proceedings, to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to
have the claims of the Trustee and of the holders of such
Securities allowed in such judicial proceedings relative to the
Corporation or any other obligor on such Securities, its or their
creditors, or its or their property, and to collect and receive
any moneys or other property payable or deliverable on any such
claims, and to distribute the same after the deduction of its
charges and expenses; and any receiver, custodian, assignee or
trustee in bankruptcy or reorganization is hereby authorized by
each of the Securityholders to make such payments to the Trustee,
and, in the event that the Trustee shall consent to the making of
such payments directly to the Securityholders, to pay to the
Trustee any amount due it for compensation and expenses,
including counsel fees incurred by it up to the date of such
distribution.
All rights of action and of asserting claims under this
Indenture, or under any of the Securities, may be enforced by the
Trustee without the possession of any of the Securities, or the
production thereof in any trial or other proceeding relative
thereto, and any suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust,
and any recovery of judgment shall be for the ratable benefit of
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the holders of the Securities in respect of which such judgment
has been recovered.
SECTION 7.03. Application of Moneys Collected by Trustee.
Any moneys collected by the Trustee shall be applied in the order
following, at the date or dates fixed by the Trustee for the
distribution of such moneys, upon presentation of the Securities
in respect of which moneys have been collected, and stamping
thereon the payment, if only partially paid, and upon surrender
thereof if fully paid:
FIRST: To the payment of costs and expenses of
collection and reasonable compensation to the Trustee, its
agents, attorneys and counsel, and of all other expenses and
liabilities incurred, and all advances made, by the Trustee
except as a result of its negligence or bad faith;
SECOND: In case the principal of the outstanding
Securities in respect of which moneys have been collected
shall not have become due and be unpaid, to the payment of
interest, if any, on such Securities, in the order of the
maturity of the installments of such interest, with interest
(to the extent that such interest has been collected by the
Trustee) upon the overdue installments of interest at the
rate of interest (or the Yield to Maturity in the case of
Discounted Securities) borne by such Securities, such
payments to be made ratably to the persons entitled thereto;
THIRD: In case the principal of the outstanding
Securities in respect of which moneys have been collected
shall have become due, by declaration or otherwise, to the
payment of the whole amount then owing and unpaid upon such
Securities for principal (and premium, if any) and interest,
if any, with interest on the overdue principal (and premium,
if any) and (to the extent that such interest has been
collected by the Trustee) upon overdue installments of
interest at the rate of interest (or the Yield to Maturity
in the case of Discounted Securities) borne by such
Securities; and in case such moneys shall be insufficient to
pay in full the whole amounts so due and unpaid upon such
Securities, then to the payment of such principal (and
premium, if any) and interest without preference or priority
of principal (and premium, if any) over interest, or of
interest over principal (and premium, if any) or of any
installment of interest over any other installment of
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interest, or of any such Security over any other such
Security, ratably to the aggregate of such principal (and
premium, if any) and accrued and unpaid interest; and,
FOURTH: To the payment of the remainder, if any, to
the Corporation, its successors or assigns, or to whomsoever
may be lawfully entitled to receive the same, or as a court
of competent jurisdiction may direct.
SECTION 7.04. Proceedings by Securityholders. No holder of
any Security of any series shall have any right by virtue of or
by availing of any provision of this Indenture to institute any
suit, action or proceeding in equity or at law upon or under or
with respect to this Indenture or for the appointment of a
receiver or trustee, or for any other remedy hereunder, unless
such holder previously shall have given to the Trustee written
notice of default and of the continuance thereof, as hereinbefore
provided, and unless also the holders of not less than twenty-
five percent in aggregate principal amount of the Securities of
that series then outstanding shall have made written request upon
the Trustee to institute such action, suit or proceeding in its
own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or
thereby, and the Trustee for sixty days after its receipt of such
notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding, it
being understood and intended, and being expressly covenanted by
the taker and holder of every Security with every other taker and
holder and the Trustee, that no one or more holders of Securities
of that series shall have any right in any manner whatever by
virtue of or by availing of any provision of this Indenture to
affect, disturb or prejudice the right of any other holder of
such Securities, or to obtain or seek to obtain priority over or
preference to any such holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities of
that series.
Notwithstanding any other provisions in this Indenture, the
right of any holder of any Security to receive payment of the
principal of (and premium, if any) and interest, if any, on such
Security, on or after the respective due dates expressed in such
Security, or to institute suit for the enforcement of any such
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payment on or after such respective dates shall not be impaired
or affected without the consent of such holder.
SECTION 7.05. Proceedings by Trustee. In case of an Event
of Default hereunder the Trustee may in its discretion proceed to
protect and enforce the rights vested in it by this Indenture by
such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either
by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid
of the exercise of any power granted in this Indenture, or to
enforce any other legal or equitable right vested in the Trustee
by this Indenture or by law.
SECTION 7.06. Remedies Cumulative and Continuing. All
powers and remedies given by this Article Seven to the Trustee or
to the Securityholders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any thereof or of any
other powers and remedies available to the Trustee or the holders
of the Securities, by judicial proceedings or otherwise, to
enforce the performance or observance of the covenants and
agreements contained in this Indenture, and no delay or omission
of the Trustee or of any holder of any of the Securities to
exercise any right or power accruing upon any default occurring
and continuing as aforesaid shall impair any such right or power,
or shall be construed to be a waiver of any such default or an
acquiescence therein; and, subject to the provisions of Section
7.04, every power and remedy given by this Article Seven or by
law to the Trustee or to the Securityholders may be exercised
from time to time and as often as shall be deemed expedient by
the Trustee or by the Securityholders.
SECTION 7.07. Direction of Proceedings and Waiver of
Defaults By Majority of Securityholders. The holders of a
majority in aggregate principal amount of the Securities of any
series at the time outstanding determined in accordance with
Section 9.04 shall have the right to direct the time, method, and
place of conducting any proceedings for any remedy available to
the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to the Securities of that series; provided,
however, that (subject to the provisions of Section 8.01) the
Trustee shall have the right to decline to follow any such
direction if the Trustee being advised by counsel determines that
the action or proceeding so directed may not lawfully be taken or
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if the Trustee in good faith by its board of directors or
trustees, executive committee, or a trust committee of directors
or trustees and/or Responsible Officers shall determine that the
action or proceedings so directed would involve the Trustee in
personal liability. Prior to any declaration accelerating the
maturity of the Securities of any series, the holders of a
majority in aggregate principal amount of the Securities
determined in accordance with Section 9.04 of that series at the
time outstanding may on behalf of the holders of all Securities
of that series waive any past default or Event of Default
hereunder and its consequences except a default in the payment of
the principal of (or premium, if any) or interest on the
Securities of that series. Upon any such waiver the Corporation,
the Trustee and the holders of such Securities shall be restored
to their former positions and rights hereunder, respectively; but
no such waiver shall extend to any subsequent or other default or
Event of Default or impair any right consequent thereon.
Whenever any default or Event of Default hereunder shall have
been waived as permitted by this Section 7.07, said default or
Event of Default shall for all Purposes of the Securities of such
series and this Indenture with respect to such Securities be
deemed to have been cured and to be not continuing.
SECTION 7.08. Notice of Defaults. The Trustee shall, within
ninety days after the occurrence of a default with respect to the
Securities of any series, mail to all holders of such Securities,
as the names and addresses of such holders appear upon the
registry books of the Corporation, notice of all defaults known
to the Trustee, unless such defaults shall have been cured before
the giving of such notice (the term "defaults" for the purpose of
this Section 7.08 being hereby defined to be the events specified
in clauses (a), (b), (c), (d) and (e) of Section 7.01, not
including periods of grace, if any, provided for therein and
irrespective of the giving of the notice specified in clause (c)
of Section 7.01); provided that, except in the case of default in
the payment of the principal of (or premium, if any) or interest,
if any, on any such Securities, the Trustee shall be protected in
withholding such notice if and so long as the board of directors
or trustees, the executive committee, or a trust committee of
directors and/or Responsible Officers of the Trustee in good
faith determines that the withholding of such notice is in the
interests of the holders of such Securities.
SECTION 7.09. Undertaking to Pay Costs. All parties to this
Indenture agree, and each holder of any Security by his
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acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of
any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken, suffered or omitted by it as
Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such
suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the
provisions of this Section 7.09 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the
aggregate more than ten percent in principal amount of the
Securities outstanding of any series, or to any suit instituted
by any Securityholder for the enforcement of the payment of the
principal of (or premium, if any) or interest, if any, on any
Security against the Corporation on or after the due date
expressed in such Security.
ARTICLE EIGHT
CONCERNING THE TRUSTEE
SECTION 8.01. Duties and Responsibilities of Trustee. With
respect to the Securities of any particular series the Trustee,
prior to the occurrence of an Event of Default and after the
curing of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are
specificallv set forth in this Indenture. In case an Event of
Default has occurred (which has not been cured or waived) with
respect to the Securities of any particular series the Trustee
shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve
the Trustee from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except
that
(a) prior to the occurrence of an Event of Default
with respect to the Securities of any particular series and
after the curing or waiving of all Events of Default with
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respect to the Securities of any particular series which may
have occurred:
(1) the duties and obligations of the Trustee
with respect to the Securities of such series shall be
determined solely by the express provisions of this
Indenture, and the Trustee shall not be liable except
for the performance of such duties and obligations as
are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into
this Indenture against the Trustee; and
(2) in the absence of bad faith on the part of
the Trustee, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but, in the case of any
such certificates or opinions which by any provision
hereof are specifically required to be furnished to the
Trustee, the Trustee shall be under a duty to examine
the same to determine whether or not they conform to
the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or
Officers of the Trustee, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
and
(c) the Trustee shall not be liable with respect to any
action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of the holders of not
less than a majority in principal amount of the Securities
of any particular series at the time outstanding determined
as provided in Section 9.04 relating to the time, method and
place of conducting any proceeding for any remedy available
to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture.
SECTION 8.02. Reliance on Documents, Opinions, etc. Subject
to the provisions of Section 8.01
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(a) the Trustee may rely and shall be protected in
acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent,
order, approval, bond, debenture, coupon or other paper or
document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the
Corporation mentioned herein shall be sufficiently evidenced
by an Officers' Certificate (unless other evidence in
respect thereof be herein specifically prescribed); and any
resolution of the Board of Directors may be evidenced to the
Trustee by a Board Resolution;
(c) the Trustee may consult with counsel and any advice
or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request, order or direction of any of the
Securityholders, pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to
the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which may be incurred
therein or thereby;
(e) the Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and believed
by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default with
respect to the Securities of any particular series hereunder
and after the curing or waiving of all Events of Default
with respect to the Securities of such series, the Trustee
shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent,
order, approval, bond, debenture, coupon or other paper or
document, unless requested in writing to do so by the
holders of not less than a majority in principal amount of
the Securities of such series then outstanding; provided,
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however, that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity
against such expense or liability as a condition to so
proceeding; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents or attorneys, and the Trustee shall not
be responsible for any misconduct or negligence on the part
of any agent or attorney appointed by it with due care
hereunder.
SECTION 8.03. No Responsibility for Recitals, etc. The
recitals contained herein and in the Securities (except in the
Trustee's certificate of authentication) shall be taken as the
statements of the Corporation, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representations as to the validity or sufficiency of
this Indenture or the Securities. The Trustee shall not be
accountable for the use or application by the Corporation of any
Securities or the proceeds of any Securities authenticated and
delivered by the Trustee in conformity with the provisions of
this Indenture.
SECTION 8.04. Trustee, Paying Agent or Registrar May Own
Securities. The Trustee or any paying agent or Security
registrar, in its individual or any other capacity, may become
the owner or pledgee of Securities with the same rights it would
have if it were not Trustee, paying agent or Security registrar.
SECTION 8.05. Moneys to Be Held in Trust. Subject to the
provisions of Section 13.04, all moneys received by the Trustee
or any paying agent shall, until used or applied as herein
provided, be held in trust for the purposes for which they were
received. Neither the Trustee nor any paying agent shall be
under any liability for interest on any moneys received by it
hereunder except such as it may agree with the Corporation to pay
thereon. So long as no Event of Default shall have occurred and
be continuing, all interest allowed on any such moneys shall be
paid from time to time upon the written order of the Corporation,
signed by any one of the Chairman of the Board, the Chief
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Executive Officer, the Vice Chairman, the President, a Vice
President, the Secretary, an Assistant Secretary, the Treasurer
or an Assistant Treasurer of the Corporation.
SECTION 8.06. Compensation and Expenses of Trustee. The
Corporation covenants and agrees to pay to the Trustee from time
to time, and the Trustee shall be entitled to, reasonable
compensation (which shall not be limited by any provision of law
in regard to the compensation of a trustee of an express trust),
and the Corporation will pay or reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any of the
provisions of this Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel
and of all persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence
or bad faith. The Corporation also covenants to indemnify the
Trustee for, and to hold it harmless against, any loss, liability
or expense incurred without negligence or bad faith on the part
of the Trustee and arising out of or in connection with the
acceptance or administration of this trust or the performance of
its duties hereunder, including the reasonable costs and expenses
of defending itself against any claim of liability in the
premises. The obligations of the Corporation under this Section
8.06 to compensate the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall constitute
additional indebtedness hereunder. Such additional indebtedness
shall have a prior claim to that of the Securities upon all
property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the holders of
particular Securities.
SECTION 8.07. Officers' Certificate as Evidence. Subject to
the provisions of Section 8.01, whenever in the administration of
the previsions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad
faith on the part of the Trustee, be deemed to be conclusively
proved and established by an Officers' Certificate delivered to
the Trustee, and such Certificate, in the absence of negligence
or bad faith on the part of the Trustee, shall be full warrant to
the Trustee for any action taken, suffered or omitted by it under
the provisions of this Indenture upon the faith thereof.
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SECTION 8.08. Conflicting Interest of Trustee. (a) If the
Trustee has or shall acquire any conflicting interest with
respect to the Securities of any series, as defined in this
Section 8.08, it shall, within 90 days after ascertaining that it
has such conflicting interest, either eliminate such conflicting
interest or resign with respect to the Securities of that series
in the manner and with the effect specified in Section 8.10.
(b) In the event that the Trustee shall fail to comply with
the provisions of subsection (a) of this Section 8.08 with
respect to the Securities of any particular series, the Trustee
shall, within ten days after the expiration of such 90-day
period, mail notice of such failure to all holders of Securities
of that series, as the names and addresses of such holders appear
upon the registry books of the Corporation.
(c) For the purposes of this Section 8.08 the Trustee shall
be deemed to have a conflicting interest with respect to the
Securities of any particular series if:
(1) the Trustee is trustee under this Indenture with
respect to the outstanding Securities of any other series or is
trustee under another indenture under which any other securities,
or certificates of interest or participation in any other
securities, of the Corporation, are outstanding, unless such
other indenture is a collateral trust indenture under which the
only collateral consists of Securities of that series; provided
that there shall be excluded from the operation of this paragraph
this Indenture with respect to the Securities of any other series
other than that series or any other indenture or indentures under
which other securities, or certificates of interest or
participation in other securities, of the Corporation, are
outstanding if (i) this Indenture and such other indenture or
indentures are wholly unsecured and such other indenture or
indentures are hereafter qualified under the Trust Indenture Act
of 1939, unless the Securities and Exchange Commission shall have
found and declared by order pursuant to subsection (b) of Section
305 or subsection (c) of Section 307 of the Trust Indenture Act
of 1939 that differences exist between the provisions of this
Indenture with respect to the Securities of that series and such
other series or the provisions of such other indenture or
indentures which are so likely to involve a material conflict of
interest as to make it necessary in the public interest or for
the protection of investors to disqualify the Trustee from acting
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as such under this Indenture with respect to the Securities of
that series and such other series or such other indenture or
indentures, or (ii) the Corporation shall have sustained the
burden of proving, on application to the Securities and Exchange
Commission and after opportunity for hearing thereon, that the
trusteeship under this Indenture with respect to the Securities
of that series and such other series or such other indenture is
not so likely to involve a material conflict of interest as to
make it necessary in the public interest or for the protection of
investors to disqualify the Trustee from acting as such under
this Indenture with respect to Securities of one or more series
or under one of such indentures;
(2) the Trustee or any of its directors or executive
officers is an obligor upon the Securities of any series issued
under this Indenture or an underwriter for the Corporation;
(3) the Trustee directly or indirectly controls or is
directly or indirectly controlled by or is under direct or
indirect common control with the Corporation or an underwriter
for the Corporation;
(4) the Trustee or any of its directors or executive
officers is a director, officer, partner, employee, appointee, or
representative of the Corporation, or of an underwriter (other
than the Trustee itself) for the Corporation who is currently
engaged in the business of underwriting, except that (A) one
individual may be a director and/or an executive officer of the
Trustee and a director and/or an executive officer of the
Corporation, but may not be at the same time an executive officer
of both the Trustee and the Corporation; (B) if and so long as
the number of directors of the Trustee in office is more than
nine, one additional individual may be a director and/or an
executive officer of the Trustee and a director of the
Corporation; and (C) the Trustee may be designated by the
Corporation or by an underwriter for the Corporation to act in
the capacity of transfer agent, registrar, custodian, paying
agent, fiscal agent, escrow agent, or depositary, or in any other
similar capacity, or, subject to the provisions of paragraph (1)
of this subsection (c), to act as trustee whether under an
indenture or otherwise;
(5) ten percent or more of the voting securities of the
Trustee is beneficially owned either by the Corporation or by any
director, partner, or executive officer thereof, or twenty
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percent or more of such voting securities is beneficially owned,
collectively, by any two or more of such persons; or ten percent
or more of the voting securities of the Trustee is beneficially
owned either by an underwriter for the Corporation or by any
director, partner, or executive officer thereof, or is
beneficially owned, collectively, by any two or more such
persons;
(6) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, (A)
five percent or more of the voting securities, or ten percent or
more of any other class of security, of the Corporation, not
including the Securities of any series with respect to which the
Trustee is acting as such and securities issued under any other
indenture under which the Trustee is also trustee, or (B) ten
percent or more of any class of security of an underwriter for
the Corporation;
(7) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, five
percent or more of the voting securities of any person who, to
the knowledge of the Trustee, owns ten percent or more of the
voting securities of, or controls directly or indirectly or is
under direct or indirect common control with, the Corporation;
(8) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, ten
percent or more of any class of security of any person who, to
the knowledge of the Trustee, owns fifty percent or more of the
voting securities of the Corporation; or
(9) the Trustee owns on May 15 in any calendar year, in the
capacity of executor, administrator, testamentary or inter vivos
trustee, guardian, committee or conservator, or in any other
similar capacity, an aggregate of twenty-five percent or more of
the voting securities, or of any class of security, of any
person, the beneficial ownership of a specified percentage of
which would have constituted a conflicting interest under
paragraphs (6), (7), or (8) of this subsection (c). As to any
such securities of which the Trustee acquired ownership through
becoming executor, administrator or testamentary trustee of an
estate which included them, the provisions of the preceding
sentence shall not apply, for a period of two years from the date
of such acquisition, to the extent that such securities included
in such estate do not exceed twenty-five percent of such voting
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securities or twenty-five percent of any such class of security.
Promptly after May 15, in each calendar year, the Trustee shall
make a check of its holdings of such securities in any of the
above-mentioned capacities as of such May 15. If the Corporation
fails to make payment in full of principal of (or premium, if
any) or interest on any of the Securities when and as the same
become due and payable, and such failure continues for thirty
days thereafter, the Trustee shall make a prompt check of its
holdings of such securities in any of the above-mentioned
capacities as of the date of the expiration of such 30-day period
and, after such date, notwithstanding the foregoing provisions of
this paragraph (9), all such securities so held by the Trustee,
with sole or joint control over such securities vested in it,
shall, but only so long as such failure shall continue, be
considered as though beneficially owned by the Trustee for the
purposes of paragraphs (6), (7) and (8) of this subsection (c).
The specifications of percentages in paragraphs (5) to (9),
inclusive, of this subsection (c) shall not be construed as
indicating that the ownership of such percentages of the
securities of a person is or is not necessary or sufficient to
constitute direct or indirect control for the purposes of
paragraph (3) or (7) of this subsection (c).
For the purposes of paragraphs (6), (7), (8) and (9) of this
subsection (c) only, (A) the terms "security" and "securities"
shall include only such securities as are generally known as
corporate securities, but shall not include any note or other
evidence of indebtedness issued to evidence an obligation to
repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or
participation in any such note or evidence of indebtedness; (B)
an obligation shall be deemed to be in default when a default in
payment of principal shall have continued for thirty days or more
and shall not have been cured; and (C) the Trustee shall not be
deemed to be the owner or holder of (i) any security which it
holds as collateral security (as trustee or otherwise) for an
obligation which is not in default as defined in class (B) above,
or (ii) any security which it holds as collateral security under
this Indenture, irrespective of any default hereunder, or (iii)
any security which it holds as agent for collection, or as
custodian, escrow agent, or depositary, or in any similar
representative capacity.
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Except as provided in the immediately preceding paragraph,
the word "security" or "securities" as used in this Indenture
shall mean any note, stock, treasury stock, bond, debentures,
evidence of indebtedness, certificate of interest or
participation in any profit sharing agreement collateral-trust
certificate, pre-organization certificate or subscription,
transferable share, investment contract, voting-trust
certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas or other mineral rights, or, in
general, any interest or instrument commonly known as a
"security" or any certificate of interest or participation in,
temporary or interim certificate for, receipt for, guarantee of,
or warrant or right to subscribe to or purchase, any of the
foregoing.
(d) For the purpose of this Section 8.08:
(1) The term "underwriter" when used with reference to
the Corporation shall mean every person who, within three
years prior to the time as of which the determination is
made, has purchased from the Corporation with a view to, or
has offered or sold for the Corporation in connection with,
the distribution of any security of the Corporation
outstanding at such time, or has participated or has had a
direct or indirect participation in any such undertaking, or
has participated or has had a participation in the direct or
indirect underwriting of any such undertaking, but such term
shall not include a person whose interest was limited to a
commission from an underwriter or dealer not in excess of
the usual and customary distributors' or sellers'
commission.
(2) The term "director" shall mean any director of a
corporation or any individual performing similar functions
with respect to any organization whether incorporated or
unincorporated.
(3) The term "person" shall mean an individual, a
corporation, a partnership, an association, a joint-stock
company, a trust, an unincorporated organization, or a
government or political subdivision thereof. As used in
this paragraph, the term "trust" shall include only a trust
where the interest or interests of the beneficiary or
beneficiaries are evidenced by a security.
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(4) The term "voting security" shall mean any security
presently entitling the owner or holder thereof to vote in
the direction or management of the affairs of a person, or
any security issued under or pursuant to any trust,
agreement or arrangement whereby a trustee or trustees or
agent or agents for the owner or holder of such security are
presently entitled to vote in the direction or management of
the affairs of a person.
(5) The term "Corporation" shall mean any obligor upon
the Securities.
(6) The term "executive officer" shall mean the chief
executive officer, vice chairman, president, every vice
president, every trust officer, the cashier, the secretary,
and the treasurer of a corporation, and any individual
customarily performing similar functions with respect to any
organization whether incorporated or unincorporated, but
shall not include the chairman of the board of directors.
The percentages of voting securities and other securities
specified in this Section 8.08 shall be calculated in accordance
with the following provisions:
(A) A specified percentage of the voting securities of the
Trustee, the Corporation or any other person referred to in this
Section 8.08 (each of whom is referred to as a "person" in this
paragraph) means such amount of the outstanding voting securities
of such person as entities the holder or holders thereof to cast
such specified percentage of the aggregate votes which the
holders of all the outstanding voting securities of such person
are entitled to cast in the direction or management of the
affairs of such person.
(B) A specified percentage of a class of securities of a
person means such percentage of the aggregate amount of
securities of the class outstanding.
(C) The term "amount", when used in regard to securities,
means the principal amount if relating to evidences of
indebtedness, the number of shares if relating to capital shares,
and the number of units if relating to any other kind of
security.
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(D) The term "outstanding" means issued and not held by or
for the account of the issuer. The following securities shall
not be deemed outstanding within the meaning of this definition:
(i) Securities of an issuer held in a sinking fund
relating to securities of the issuer of the same class;
(ii) Securities of an issuer held in a sinking fund
relating to another class of securities of the issuer, if
the obligation evidenced by such other class of securities
is not in default as to principal or interest or otherwise;
(iii) Securities pledged by the issuer thereof as
security for an obligation of the issuer not in default as
to principal or interest or otherwise;
(iv) Securities held in escrow if placed in escrow by
the issuer thereof;
provided, however, that any voting securities of an issuer shall
be deemed outstanding if any person other than the issuer is
entitled to exercise the voting rights thereof.
(E) A security shall be deemed to be of the same class as
another security if both securities confer upon the holder or
holders thereof substantially the same rights and privileges;
provided, however, that, in the case of secured evidences of
indebtedness, all of which are issued under a single indenture,
differences in the interest rates or maturity dates of various
series thereof shall not be deemed sufficient to constitute such
series different classes, and provided, further, that, in the
case of unsecured evidences of indebtedness, differences in the
interest rates or maturity dates thereof shall not be deemed
sufficient to constitute them securities of different classes,
whether or not they are issued under a single indenture.
SECTION 8.09. Eligibility of Trustee. The Trustee hereunder
shall at all times be a corporation organized and doing business
under the laws of the United States or any State or Territory
thereof or of the District of Columbia authorized under such laws
to exercise corporate trust powers, having a combined capital and
surplus of at least five million dollars and subject to
supervision or examination by Federal, State, Territorial, or
District of Columbia authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the
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requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section 8.09, the combined capital
and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time the
Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.09, the Trustee shall resign
immediately in the manner and with the effect specified in
Section 8.10.
SECTION 8.10. Resignation or Removal of Trustee. (a) The
Trustee may at any time resign with respect to the Securities of
one or more series by giving written notice of such resignation
to the Corporation and by mailing notice thereof to the holders
of Securities of such series at their addresses as they shall
appear on the registry books of the Corporation. Upon receiving
such notice of resignation, the Corporation shall promptly
appoint a successor trustee or trustees with respect to the
Securities of such series by written instrument, in duplicate,
executed by order of the Board of Directors, one copy of which
instrument shall be delivered to the resigning Trustee and one
copy to each successor trustee. If no successor trustee shall
have been so appointed and have accepted appointment within sixty
days after the mailing of such notice of resignation to the
Securityholders of such series, the resigning Trustee may
petition any court of competent jurisdiction for the appointment
of a successor trustee, or any Securityholder who has been a bona
fide holder of a Security or Securities of such series for at
least six months may, subject to the provisions of Section 7.09,
on behalf of himself and all others similarly situated, petition
any such court for the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem
proper and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur-
(1) the Trustee shall fail to comply with the
provisions of subsection (a) of Section 8.08 after written
request therefor by the Corporation or by any Securityholder
who has been a bona fide holder of a Security or Securities
for at least six months, or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.09 and shall
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fail to resign after written request therefor by the
Corporation or by any such Securityholder, or
(3) the Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of
the Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Trustee
or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, the Corporation may remove the Trustee
with respect to all Securities and appoint a successor trustee or
trustees by written instrument, in duplicate, executed by order
of the Board of Directors, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to each
successor trustee, or, subject to the provisions of Section 7.09,
any Securityholder who has been a bona fide holder of a Security
or Securities for at least six months may, on behalf of himself
and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the
appointment of a successor trustee or trustees. Such court may
thereupon, after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee or
trustees.
(c) The holders of a majority in aggregate principal amount
of the Securities of any series at the time outstanding may at
any time remove the Trustee with respect to such series and
nominate a successor trustee.
(d) Any resignation or removal of the Trustee and any
appointment of a successor trustee pursuant to any of the
provisions of this Section 8.10 shall become effective upon
acceptance of appointment by the successor trustee as provided in
Section 8.11.
SECTION 8.11. Acceptance by Successor Trustee. In the case
of the appointment hereunder of a successor trustee with respect
to all Securities, any successor trustee so appointed as provided
in Section 8.10 shall execute, acknowledge and deliver to the
Corporation and to its predecessor trustee an instrument
accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act,
deed or conveyance, shall become vested with all the rights,
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powers, duties and obligations of its predecessor hereunder, with
like effect as if originally named as trustee herein:
nevertheless, on the written request of the Corporation or of the
successor trustee, the trustee ceasing to act shall, upon payment
of any amounts then due it pursuant to the provisions of Section
8.06, execute and deliver an instrument transferring to such
successor trustee a the rights and powers of the trustee so
ceasing to act. In case of the appointment hereunder of a
successor trustee with respect to the Securities of one or more
(but not all) series, the Corporation, the predecessor trustee
and each successor trustee with respect to the Securities of one
or more series shall execute and deliver an indenture
supplemental hereto wherein each successor trustee shall accept
such appointment and which (1) shall contain such provisions as
shall be necessary or desirable to vest in, or confirm to, each
successor trustee all the rights, powers, duties and obligations
of the predecessor trustee with respect to the Securities of that
or those series to which the appointment of such successor
trustee relates, (2) if the predecessor trustee is not retiring
with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the
rights, powers, duties and obligations of the predecessor trustee
with respect to the Securities of that or those series as to
which the predecessor trustee is not retiring shall continue to
be vested in the predecessor trustee, and (3) shall add to or
change any of the provisions of the Indenture as shall be
necessary to provide for or facilitate the administration of the
trusts hereunder by more than one trustee, it being understood
that nothing herein or in such supplemental indenture shall
constitute such trustees co-trustees of the same trust and that
each such trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder
administered by any other such trustee; and upon the execution
and delivery of such supplemental indenture the resignation or
removal of the predecessor trustee shall become effective to the
extent provided therein and each such successor trustee, without
any further act, deed or conveyance, shall become vested with all
the rights, powers, duties and obligations of the predecessor
trustee with respect to the Securities of that or those series to
which the appointment of such successor trustee relates; but,
nevertheless, on the written request of the Corporation or any
successor trustee, such predecessor trustee shall, upon payment
of any amounts then due to it pursuant to Section 8.06 hereof,
duly assign, transfer and deliver to such successor trustee all
property and money held by such predecessor trustee hereunder
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with respect to the Securities of that or those series to which
the appointment of such successor trustee relates. Upon request
of any such successor trustee, the Corporation shall execute any
and all instruments in writing in order more fully and certainly
to vest in and confirm to such successor trustee all such rights,
powers and trusts referred to in the two preceding sentences.
Any trustee ceasing to act shall, nevertheless, retain a prior
claim upon all property or funds held or collected by such
trustee to secure any amounts then due it pursuant to the
provisions of Section 8.06.
No successor trustee shall accept appointment as provided in
this Section 8.11 unless at the time of such acceptance such
successor trustee shall be qualified under the provisions of
Section 8.08 and eligible under the provisions of Section 8.09.
Upon acceptance of appointment by a successor trustee as
provided in this Section 8.11, the Corporation shall mail notice
of the succession of such trustee hereunder to all holders of
Securities of the series affected as the names and addresses of
such holders appear on the registry books of the Corporation. If
the Corporation fails to mail such notice in the prescribed
manner within 30 days after the acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice
to be mailed at the expense of the Corporation.
SECTION 8.12. Succession by Merger, etc. Any corporation
into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be
a party or any corporation succeeding to all or substantially all
of the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder without the execution or
filing of any paper or any further act on the part of any of the
parties hereto.
In case at the time such successor to the Trustee shall
succeed to the trusts created by this Indenture any of the
Securities shall have been authenticated but not delivered, any
such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such
Securities so authenticated; and in case at that time any of the
Securities shall not have been authenticated, any successor to
the Trustee may authenticate such Securities either in the name
of any predecessor hereunder or in the name of the successor
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trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this
Indenture provided that the certificate of the Trustee shall
have; provided, however, that the right to adopt the certificate
of authentication of any predecessor Trustee or authenticate
Securities in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or
consolidation.
SECTION 8.13. Limitation on Rights of Trustee as a Creditor.
(a) Subject to the provisions of subsection (b) of this Section
8.13, if the Trustee shall be or shall become a creditor,
directly or indirectly, secured or unsecured, of the Corporation
or of any other obligor on the Securities within four months
prior to a default as defined in subsection (c) of this Section
8.13. or subsequent to such a default, then, unless and until
such default shall be cured, the Trustee shall set apart and hold
in a special account for the benefit of the Trustee individually,
the holders of the Securities with respect to which the Trustee
is acting as such, and the holders of other indenture securities
(as defined in paragraph (2) of subsection (c) of this Section
8.13)
(1) an amount equal to any and all reductions in the
amount due and owing upon any claim as such creditor in
respect of principal (or premium, if any) or interest,
effected after the beginning of such four-month period and
valid as against the Corporation and its other creditors,
except any such reduction resulting from the receipt or
disposition of any property described in paragraph (2) of
this subsection, or from the exercise of any right of set-
off which the Trustee could have exercised if a petition in
bankruptcy had been filed by or against the Corporation upon
the date of such default; and
(2) all property received by the Trustee in respect of
any claim as such creditor, either as security therefor, or
in satisfaction or composition thereof, or otherwise, after
the beginning of such four-month period, or an amount equal
to the proceeds of any such property, if disposed of,
subject, however, to the rights, if any, of the Corporation
and its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the
Trustee
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(A) to retain for its own account (i) payments made on
account of any such claim by any person (other than the
Corporation) who is liable thereon, and (ii) the proceeds of
the bona fide sale of any such claim by the Trustee to a
third person, and (iii) distributions made in cash,
securities, or other property in respect of claims filed
against the Corporation in bankruptcy or receivership or in
proceedings for reorganization pursuant to the Federal
Bankruptcy Code or applicable State law;
(B) to realize, for its own account, upon any property
held by it as security for any such claim, if such property
was so held prior to the beginning of such four-month
period;
(C) to realize, for its own account, but only to the
extent of the claim hereinafter mentioned, upon any property
held by it as security for any such claim, if such claim was
created after the beginning of such four-month period and
such property was received as security therefor
simultaneously with the creation thereof, and if the Trustee
shall sustain the burden of proving that at the time such
property was so received the Trustee had no reasonable cause
to believe that a default, as defined in subsection (c) of
this Section 8.13, would occur within four months; or
(D) to receive payment on any claim referred to in
paragraph (B) or (C), against the release of any property
held as security for such claim as provided in such
paragraph (B) or (C), as the case may be, to the extent of
the fair value of such property.
For the purposes of paragraphs (B), (C) and (D), property
substituted after the beginning of such four-month period for
property held as security at the time of such substitution shall,
to the extent of the fair value of the property released, have
the same status as the property released and, to the extent that
any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying
or refunding any pre-existing claim of the Trustee as such
creditor, such claim shall have the same status as such
preexisting claim.
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If the Trustee shall be required to account, the funds and
property held in such special account and the proceeds there of
shall be apportioned between the Trustee, the Securityholders and
the holders of other indenture securities in such manner that the
Trustee, the Securityholders and the holders of other indenture
securities realize, as a result of payments from such special
account and payments of dividends on claims filed against the
Corporation in bankruptcy or receivership or in proceedings for
reorganization pursuant to the Federal Bankruptcy Code or
applicable State law, the same percentage of their respective
claims, figured before crediting to the claim of the Trustee
anything on account of the receipt by it from the Corporation of
the funds and property in such a special account and before
crediting to the respective claims of the Trustee, the
Securityholders, and the holders of other indenture securities,
dividends on claims filed against the Corporation in bankruptcy
or receivership or in proceedings for reorganization pursuant to
the Federal Bankruptcy Code or applicable State law, but after
crediting thereon receipts on account of the indebtedness
represented by their respective claims from all sources other
than from such dividends and from the funds and property so held
in such special account. As used in this paragraph, with respect
to any claim, the term "dividends" shall include any distribution
with respect to such claim, in bankruptcy or receivership or in
proceedings for reorganization pursuant to the Federal Bankruptcy
Code or applicable State law, whether such distribution is made
in cash, securities, or other property, but shall not include any
such distribution with respect to the secured portion, if any, of
such claim. The court in which such bankruptcy, receivership, or
proceeding for reorganization is pending shall have jurisdiction
(i) to apportion between the Trustee, the Securityholders, and
the holders of other indenture securities, in accordance with the
provisions of this paragraph, the funds and property held in such
special account and the proceeds thereof, or (ii) in lieu of such
apportionment, in whole or in part, to give to the provisions of
this paragraph due consideration in determining the fairness of
the distribution to be made to the Trustee, the Securityholders
and the holders of other indenture securities with respect to
their respective claims, in which event it shall not be necessary
to liquidate or to appraise the value of any securities or other
property held in such special account or as security for any such
claim or to make a specific allocation of such distributions as
between the secured and unsecured portions of such claims, or
otherwise to apply the provisions of this paragraph as a
mathematical formula.
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Any Trustee who has resigned or been removed after the
beginning of such four-month period shall be subject to the
provisions of this subsection (a) as though such resignation or
removal had not occurred. If any Trustee has resigned or been
removed prior to the beginning of such four-month period, it
shall be subject to the provisions of this subsection (a) if and
only if the following conditions exist:
(i) the receipt of property or reduction of claim
which would have given rise to the obligation to account, if
such Trustee had continued as trustee, occurred after the
beginning of such four-month period; and
(ii) such receipt of property or reduction of claim
occurred within four months after such resignation or
removal.
(b) There shall be excluded from the operation of
subsection (a) of this Section 8.13 a creditor relationship
arising from:
(1) the ownership or acquisition of securities issued
under any indenture, or any security or securities having a
maturity of one year or more at the time of acquisition by
the Trustee;
(2) advances authorized by a receivership or
bankruptcy court of competent jurisdiction, or by this
Indenture, for the purpose of preserving any property which
shall at any time be subject to the lien of this Indenture
or of discharging tax liens or other prior liens or
encumbrances thereon, if notice of such advance and of the
circumstances surrounding the making thereof is given to the
Securityholders at the time and in the manner provided in
Section 6.04 with respect to reports pursuant to subsections
(a) and (b) thereof, respectively;
(3) disbursements made in the ordinary course of
business in the capacity of trustee under an indenture,
transfer agent, registrar, custodian, paying agent, fiscal
agent or depositary, or other similar capacity;
(4) an indebtedness created as a result of services
rendered or premises rented; or an indebtedness created as a
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result of goods or securities sold in a cash transaction as
defined in subsection (c) of this Section 8.13;
(5) the ownership of stock or of other securities of a
corporation organized under the provisions of Section 25(a)
of the Federal Reserve Act, as amended, which is directly or
indirectly a creditor of the Corporation; or
(6) the acquisition, ownership, acceptance or
negotiation of any drafts, bills of exchange, acceptances or
obligations which fall within the classification of self-
liquidating paper as defined in subsection (c) of this
Section 8.13.
(c) As used in this Section 8.13:
(1) the term "default" shall mean any failure to make
payment in full of the principal of or interest upon any of
the Securities or upon the other indenture securities when
and as such principal or interest becomes due and payable:
(2) the term "other indenture securities" shall mean
securities upon which the Corporation is an obligor (as
defined in the Trust Indenture Act of 1939) outstanding
under any other indenture (A) under which the Trustee is
also trustee, (B) which contains provisions substantially
similar to the provisions of subsection (a) of this Section
8.13, and (C) under which a default exists at the time of
the apportionment of the funds and property held in said
special account;
(3) the term "cash transaction" shall mean any
transaction in which full payment for goods or securities
sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders drawn
upon banks or bankers and payable upon demand;
(4) the term "self-liquidating paper" shall mean any
draft, bill of exchange, acceptance or obligation which is
made, drawn, negotiated or incurred by the Corporation for
the purpose of financing the purchase, processing,
manufacture, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing
title to, possession of, or a lien upon, the goods, wares or
merchandise or the receivables or proceeds arising from the
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sale of the goods, wares or merchandise previously
constituting the security; provided that the security is
received by the Trustee simultaneously with the creation of
the creditor relationship with the Corporation arising from
the making, drawing, negotiating or incurring of the draft,
bill of exchange, acceptance or obligation; and
(5) the term "Corporation" shall mean any obligor upon
the Securities.
ARTICLE NINE
CONCERNING THE SECURITYHOLDERS
SECTION 9.01. Action by Securityholders. Whenever in this
Indenture it is provided that the holders of a specified
percentage in aggregate principal amount of the Securities of any
or all series may take any action (including the making of any
demand or request, the giving of any notice, consent or waiver or
the taking of any other action) the fact that at the time of
taking any such action the holders of such specified percentage
have joined therein may be evidenced, subject to Section 10.07,
(a) by any instrument or any number of instruments of similar
tenor executed by holders of such Securities in person or by
agent or proxy appointed in writing, or (b) by the record of the
holders of such Securities voting in favor thereof at any meeting
of holders of such Securities duly called and held in accordance
with the provisions of Article Ten, or (c) by a combination of
such instrument or instruments and any such record of such a
meeting of holders of such Securities.
SECTION 9.02. Proof of Execution by Securityholders.
Subject to the provisions of Sections 8.01, 8.02 and 10.05, proof
of the execution of any instruments by a Securityholder or his
agent or proxy shall be sufficient if made in accordance with
such reasonable rules and regulations as may be prescribed by the
Trustee or in such manner as shall be satisfactory to the
Trustee. The ownership of Securities shall be proved by the
registry books of the Corporation or by a certificate of the
Security registrar.
The record of any Securityholders' meeting shall be proved
in the manner provided in Section 10.06.
SECTION 9.03. Who Are Deemed Absolute Owners. The
Corporation, the Trustee, any paying agent and any Security
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registrar may deem the person in whose name any Securities shall
be registered upon the registry books of the Corporation to be,
and may treat such person as, the absolute owner of such Security
(whether or not such Security shall be overdue) for the purpose
of receiving payment of or on account of the principal of (and
premium, if any) and interest, if any, on such Security and for
all other purposes; and neither the Corporation nor the Trustee
nor any paying agent nor any Security registrar shall be affected
by any notice to the contrary. All such payments so made to any
holder for the time being, or upon his order shall be valid, and,
to the extent of the sum or sums so paid, effective to satisfy
and discharge the liability for moneys payable upon any such
Security.
No holder of any beneficial interest in any global Security
held on its behalf by a Depositary shall have any rights under
this Indenture with respect to such global Security, and such
Depositary may be treated by the Corporation, the Trustee, any
paying agent and any agent of the Corporation or the Trustee as
the owner of such global Security for all purposes whatsoever.
None of the Corporation, the Trustee, any paying agent or any
Security registrar will have any responsibility or liability for
any aspect of the records relating to or payments made on account
of beneficial ownership interests of a global Security or for
maintaining, supervising or reviewing any records related to such
beneficial ownership interests.
SECTION 9.04. Corporation-Owned Securities Disregarded. In
determining whether the holders of the requisite aggregate
principal amount of Securities have concurred in any direction,
consent or waiver under this Indenture, Securities which are
owned by the Corporation or any other obligor on the Securities
or by any person directly or indirectly controlling or controlled
by or under direct or indirect common control with the
Corporation or any other obligor on the Securities shall be
disregarded and deemed not to be outstanding for the purpose of
any such determination; provided that for the purposes of
determining whether the Trustee shall be protected in relying on
any such direction, consent or waiver only Securities which the
Trustee knows are so owned shall be so disregarded. Securities
so owned which have been pledged in good faith may be regarded as
outstanding for the purposes of this Section 9.04 if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's
right to vote such Securities and that the pledgee is not a
person directly or indirectly controlling or controlled by or
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under direct or indirect common control with the Corporation or
any such other obligor. In the case of a dispute as to such
right, any decision by the Trustee taken upon the advice of
counsel shall be full protection to the Trustee.
SECTION 9.05. Revocation of Consents; Future Holders Bound.
At any time prior to (but not after) the evidencing to the
Trustee, as provided in Section 9.01, of the taking of any action
by the holders of the percentage in aggregate principal amount of
the Securities specified in this Indenture in connection with
such action, any holder of a Security the serial number of which
is shown by the evidence to be included in the Securities the
holders of which have consented to such action may, by filing
written notice with the Trustee at its principal office and upon
proof of holding as provided in Section 9.02, revoke such action
so far as concerns such Security. Except as aforesaid any such
action taken by the holder of any Security shall be conclusive
and binding upon such holder and upon all future holders and
owners of such Security and of any Security issued in exchange or
substitution therefore, irrespective of whether or not any
notation in regard thereto is made upon such Security.
ARTICLE TEN
SECURITYHOLDERS' MEETINGS
SECTION 10.01. Purposes of Meetings. A meeting of holders
of Securities of one or more series may be called at any time and
from time to time pursuant to the provisions of this Article Ten
for any of the following purposes:
(1) to give any notice to the Corporation or to the
Trustee, or to give any directions to the Trustee, or to
consent to the waiving of any default hereunder and its
consequences, or to take any other action authorized to be
taken by such Securityholders pursuant to any of the
provisions of Article Seven;
(2) to remove the Trustee and nominate a successor
trustee pursuant to the provisions of Article Eight;
(3) to consent to the execution of an indenture or
indentures supplemental hereto pursuant to the provisions of
Section 11.02; or
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(4) to take any other action authorized to be taken by
or on behalf of the holders of any specified aggregate
principal amount of the Securities of one or more series
under any other provision of this Indenture or under
applicable law.
SECTION 10.02. Call of Meetings by Trustee. The Trustee may
at any time call a meeting of holders of Securities of one or
more series to take any action specified in Section 10.01, to be
held at such time and at such place in the City of Baltimore,
State of Maryland, as the Trustee shall determine. Notice of
every such meeting of the Securityholders, setting forth the time
and place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be mailed to holders
of Securities of each series affected at their addresses as they
shall appear on the registry books of the Corporation. Such
notice shall be mailed not less than 20 nor more than 90 days
prior to the date fixed for the meeting.
SECTION 10.03. Call of Meetings by Corporation or
Securityholders. In case at any time the Corporation, pursuant
to a Board Resolution, or the holders of at least ten percent in
aggregate principal amount of the Securities of one or more
series then outstanding, shall have requested the Trustee to call
a meeting of Securityholders of Securities of such series, by
written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not
have mailed the notice of such meeting within 20 days after
receipt of such request, then the Corporation or such
Securityholders may determine the time and the place in said City
of Baltimore for such meeting and may call such meeting to take
any action authorized in Section 10.01, by mailing notice thereof
as provided in Section 10.02.
SECTION 10.04. Qualifications for Voting. To be entitled to
vote at any meeting of holders of Securities of any series a
person shall (a) be a holder of one or more Securities of such
series or (b) be a person appointed by an instrument in writing
as proxy by a holder of one or more Securities of such series.
The only persons who shall be entitled to be present or to speak
at any meeting of Securityholders shall be the persons entitled
to vote at such meeting and their counsel and any representatives
of the Trustee and its counsel and any representatives of the
Corporation and its counsel.
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SECTION 10.05. Regulations. Notwithstanding any other
provisions of this Indenture, the Trustee may make such
reasonable regulations as it may deem advisable for any meeting
of Securityholders, in regard to proof of the holding of
Securities and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission
and examination of proxies, certificates and other evidence of
the right to vote, and such other matters concerning the conduct
of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a
temporary chairman of the meeting, unless the meeting shall have
been called by the Corporation or by the Securityholders as
provided in Section 10.03, in which case the Corporation or the
Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman
and a permanent secretary of the meeting shall be elected by
majority vote of the meeting.
Subject to the provisions of Section 9.04, at any meeting
each Securityholder or proxy shall be entitled to one vote for
each $1,000 principal amount (in the case of Discounted
Securities, such principal amount to be determined as provided in
the definition of the term "outstanding") of Securities held or
represented by such Securityholder; provided, however, that no
vote shall be cast or counted at any meeting in respect of any
Security challenged as not outstanding and ruled by the chairman
of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote other than by virtue of
Securities held by him or instruments in writing as aforesaid
duly designating him as the person to vote on behalf of other
Securityholders. Any meeting of Securityholders duly called
pursuant to the provisions of Section 10.02 or 10.03 may be
adjourned from time to time by a majority of those present.
whether or not constituting a quorum, and the meeting may be held
as so adjourned without further notice.
SECTION 10.06. Voting. The vote upon any resolution
submitted to any meeting of Securityholders shall be by written
ballots on which shall be subscribed the signatures of the
holders of Securities or of their representatives by proxy and
the principal amount of the Securities held or represented by
them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting
for or against any resolution and who shall make and file with
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the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record in
duplicate of the proceedings of each meeting of Securityholders
shall be prepared by the secretary of the meeting and there shall
be attached to said record the original reports of the inspectors
of votes on any vote by ballot taken thereat and affidavits by
one or more persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice
was mailed as provided in Section 10.02. The record shall show
the principal amount of the Securities voting in favor of or
against any resolution. The record shall be signed and verified
by the affidavits of the permanent chairman and secretary of the
meeting and one of the duplicates shall be delivered to the
Corporation and the other to the Trustee to be preserved by the
Trustee.
Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
SECTION 10.07. Written Consent in Lieu of Meeting. The
written authorization or consent of the requisite percentage of
Securityholders herein provided, entitled to vote at any such
meeting, evidenced as provided in Article Nine and filed with the
Trustee shall be effective in lieu of a meeting of
Securityholders, with respect to any matter provided for in this
Article Ten.
ARTICLE ELEVEN
SUPPLEMENTAL INDENTURES
SECTION 11.01. Supplemental Indentures Without Consent of
Securityholders. The Corporation, when authorized by a
resolution of the Board of Directors, and the Trustee may from
time to time and at any time enter into an indenture or
indentures supplemental hereto for one or more of the following
purposes:
(a) to evidence the succession of another corporation
to the Corporation, or successive successions, and the
assumption by the successor corporation of the covenants,
agreements and obligations of the Corporation pursuant to
Article Twelve hereof;
(b) to add to the covenants of the Corporation such
further covenants, restrictions or conditions for the
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protection of the holders of the Securities as the Board of
Directors and the Trustee shall consider to be for the
protection of the holders of Securities, and to make the
occurrence, or the occurrence and continuance, of a default
in any of such additional covenants, restrictions or
conditions a default or an Event of Default permitting the
enforcement of all or any of the several remedies provided
in this Indenture as herein set forth; provided, however,
that in respect of any such additional covenant, restriction
or condition such supplemental indenture may provide for a
particular period of grace after default (which period may
be shorter or longer than that allowed in the case of other
defaults) or may provide for an immediate enforcement upon
such default or may limit the remedies available to the
Trustee upon such default;
(c) to provide for the issuance under this Indenture
of Securities in coupon form (including Securities
registrable as to principal only) and to provide for
exchangeability of such Securities with the Securities of
the same series issued hereunder in fully registered form
and to make all appropriate changes for such purpose;
(d) to cure any ambiguity or to correct or supplement
any provision contained herein or in any supplemental
indenture which may be defective or inconsistent with any
other provision contained herein or in any supplemental
indenture or to make such other provisions in regard to
matters or questions arising under this Indenture which
shall not adversely affect the interest of the holders of
the Securities;
(e) to add to the conditions, limitations and
restrictions on the authorized amount, terms or purposes of
issue, authentication and delivery of Securities, as herein
set forth, other conditions, limitations and restrictions
thereafter to be observed; or
(f) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to
the Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be
necessary to provide for or facilitate the administration of
the Trusts hereunder by more than one Trustee, pursuant to
the requirements of Section 8.11 hereof.
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The Trustee is hereby authorized to join with the
Corporation in the execution of any such supplemental indenture,
to make any further appropriate agreements and stipulations which
may be therein contained and to accept the conveyance, transfer
and assignment of any property thereunder, but the Trustee shall
not be obligated to, but may in its discretion, enter into any
such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
Any supplemental indenture authorized by the provisions of
this Section 11.01 may be executed by the Corporation and the
Trustee without the consent of the holders of any of the
Securities at the time outstanding, notwithstanding any of the
provisions of Section 11.02.
SECTION 11.02. Supplemental Indentures with Consent of
Securityholders. With the consent (evidenced as provided in
Section 9.01) of the holders of not less than 66 2/3% in
aggregate principal amount of the Securities of all series
affected by such supplemental indenture (voting as one class) at
the time outstanding, the Corporation, when authorized by a
resolution of the Board of Directors, and the Trustee may from
time to time and at any time enter into an indenture or
indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of any supplemental indenture or
of modifying in any manner the rights of the holders of the
Securities of each such series; provided, however, that no such
supplemental indenture shall extend the fixed maturity of any
Security, or reduce the rate or change the method to be used in
establishing the rate or extend the time of payment of interest
thereon, or reduce the principal amount thereof, or reduce any
premium payable upon the redemption thereof, or reduce the amount
of the principal of a Discounted Security that would be due and
payable upon a declaration of acceleration of the maturity
thereof pursuant to Section 7.01, or make the principal thereof
or premium or interest thereon payable in any coin or currency
other than that provided in such Securities, without the consent
of the holder of each Security so affected, or (ii) reduce the
aforesaid percentage of Securities, the holders of which are
required to consent to any such supplemental indenture, without
the consent of the holders of all Securities of the series
affected then outstanding. A supplemental indenture which
changes or eliminates any covenant or other provision of this
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Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which
modifies the rights of the holders of Securities of such series
with respect to such covenant or other provision, shall be deemed
not to affect the rights under this Indenture of the holders of
Securities of any other series.
Upon the request of the Corporation, accompanied by a Board
Resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of
the consent of Securityholders as aforesaid, the Trustee shall
join with the Corporation in the execution of such supplemental
indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture
or otherwise, in which case the Trustee may in its discretion,
but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the
Securityholders under this Section 11.02 to approve the
particular form of any proposed supplemental indenture, but it
shall be sufficient if such consent shall approve the substance
thereof.
SECTION 11.03. Compliance with Trust Indenture Act; Effect
of Supplemental Indenture. Any supplemental indenture executed
pursuant to the provisions of this Article Eleven shall comply
with the Trust Indenture Act of 1939, as then in effect. Upon
the execution of any supplemental indenture pursuant to the
provisions of this Article Eleven, this Indenture shall be and be
deemed to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and
immunities under this Indenture of the Trustee, the Corporation
and the holders of Securities of the series affected shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments and
all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of
this Indenture for any and all purposes.
SECTION 11.04. Notation on Securities. Securities
authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article
Eleven may bear a notation in form approved by the Trustee as to
any matter provided for in such supplemental indenture. If the
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Corporation shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Board of
Directors, to any modification of this Indenture contained in any
such supplemental indenture, may be prepared and executed by the
Corporation, authenticated by the Trustee and delivered in
exchange for the Securities then outstanding.
SECTION 11.05. Evidence of Compliance of Supplemental
Indenture to Be Furnished Trustee. The Trustee, subject to the
provisions of Sections 8.01 and 8.02, may receive an Officers'
Certificate and an Opinion of Counsel as conclusive evidence that
any supplemental indenture executed pursuant hereto complies with
the requirements of this Article Eleven.
ARTICLE TWELVE
CONSOLIDATION, MERGER AND SALE
SECTION 12.01. Corporation May Consolidate, etc., on Certain
Terms. Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of the
Corporation with or into any other corporation or corporations
(whether or not affiliated with the Corporation), or successive
consolidations or mergers in which the Corporation or its
successor or successors shall be a party or parties, or shall
prevent any sale or conveyance of all or substantially all the
property of the Corporation to any other corporation (whether or
not affiliated with the Corporation) authorized to acquire and
operate the same; provided, however, and the Corporation hereby
covenants and agrees, that upon any such consolidation, merger,
sale or conveyance, the due and punctual payment of the principal
of (and premium, if any) and interest, if any, on all of the
Securities, according to their tenor, and the due and punctual
performance and observance of all of the covenants and conditions
of this Indenture to be performed by the Corporation, shall be
expressly assumed by supplemental indenture satisfactory in form
to the Trustee, executed and delivered to the Trustee, by the
corporation (if other than the Corporation) formed by such
consolidation, or into which the Corporation shall have been
merged, or by the corporation which shall have acquired such
property.
SECTION 12.02. Successor Corporation to Be Substituted. In
case of any such consolidation, merger, sale or conveyance and
upon the assumption by the successor corporation, by supplemental
indenture, executed and delivered to the Trustee and satisfactory
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in form to the Trustee, of the due and punctual payment of the
principal of (and premium, if any) and interest, if any, on all
of the Securities and the due and punctual performance of all of
the covenants and conditions of this Indenture to be performed by
the Corporation, such successor corporation shall succeed to and
be substituted for the Corporation, with the same effect as if it
had been named herein as the Corporation. Such successor
corporation thereupon may cause to be signed, and may issue
either in its own name or in the name of Constellation Energy
Corporation any or all of the Securities issuable hereunder which
theretofore shall not have been signed by the Corporation and
delivered to the Trustee; and, upon the order of such successor
corporation instead of the Corporation and subject to all the
terms, conditions and limitations in this Indenture prescribed,
the Trustee shall authenticate and shall deliver any Securities
which previously shall have been signed and delivered by the
officers of the Corporation to the Trustee for authentication,
and any Securities which such successor corporation thereafter
shall cause to be signed and delivered to the Trustee for that
purpose. All the Securities of a particular series so issued
shall in all respects have the same legal rank and benefit under
this Indenture as the Securities of such series theretofore or
thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of
the execution hereof.
Nothing contained in this Indenture or in any of the
Securities shall prevent the Corporation from merging into itself
any other corporation (whether or not affiliated with the
Corporation) or acquiring by purchase or otherwise all or any
part of the property of any other corporation (whether or not
affiliated with the Corporation), provided that, immediately
after such merger or acquisition, the Corporation shall not be in
default in the performance or observance of any of the terms,
covenants and conditions of this Indenture to be kept or
performed by it.
SECTION 12.03. Opinion of Counsel to Be Given Trustee. The
Trustee, subject to Sections 8.01 and 8.02, may receive an
Opinion of Counsel as conclusive evidence that any such
consolidation, merger, sale or conveyance and any such assumption
complies with the provisions of this Article.
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ARTICLE THIRTEEN
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 13.01. Discharge of Indenture. When (a) the
Corporation shall deliver to the Trustee for cancellation all
Securities theretofore authenticated (other than any Securities
which shall have been destroyed, lost or stolen and which shall
have been replaced or paid as provided in Section 3.05) and not
theretofore cancelled, or (b) all the Securities not theretofore
delivered to the Trustee for cancellation shall have become due
and payable, or are by their terms to become due and payable
within one year and the Corporation shall deposit with the
Trustee or any paying agent, in trust, funds sufficient to pay at
maturity all of the Securities (other than any Securities which
shall have been mutilated, destroyed, lost or stolen and which
shall have been replaced or paid as provided in Section 3.05) not
theretofore delivered to the Trustee for cancellation, including
principal (and premium, if any) and interest, if any, due or to
become due to such date of maturity, but excluding, however, the
amount of any moneys for the payment of the principal of (and
premium, if any) or interest, if any, on the Securities (1)
theretofore deposited with the Trustee or any paying agent and
repaid by the Trustee or any paying agent to the Corporation in
accordance with the provisions of Section 13.04, or (2) paid to
any State or to the District of Columbia pursuant to its
unclaimed property or similar laws, and if in either case the
Corporation shall also pay or cause to be paid all other sums
payable hereunder by the Corporation, then this Indenture shall
cease to be of further effect, and the Trustee, on demand of the
Corporation accompanied by an Officers' Certificate and an
Opinion of Counsel as required by Section 16.05 and at the cost
and expense of the Corporation, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture.
The Corporation, however, hereby agrees to reimburse the Trustee
for any costs or expenses thereafter reasonably and properly
incurred by the Trustee in connection with this Indenture or the
Securities.
SECTION 13.02. Deposited Moneys to Be Held in Trust by
Trustee. All moneys deposited with the Trustee or any paying
agent pursuant to Section 13.01 shall be held in trust and
applied by it to the payment, either directly or through any
paying agent (including the Corporation if acting as its own
paying agent), to the holders of the particular Securities for
the payment of which such moneys have been deposited with the
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Trustee, or any paying agent, of all sums due and to become due
thereon for principal (and premium, if any) and interest.
SECTION 13.03. Paying Agent to Repay Moneys Held. Upon the
satisfaction and discharge of this Indenture all moneys then held
by any paying agent of the Securities (other than the Trustee)
shall, upon demand of the Corporation, be repaid to it or paid to
the Trustee, and thereupon such paying agent shall be released
from all further liability with respect to such moneys.
SECTION 13.04. Return of Unclaimed Moneys. Any moneys
deposited with or paid to the Trustee for payment of the
principal of (or premium, if any) or interest on Securities of
any series and not applied but remaining unclaimed by the holders
of such Securities for two years after the date upon which the
principal of (or premium, if any) or interest on such Securities,
as the cam may be, shall have become due and payable, shall on
demand of the Corporation be repaid to the Corporation by the
Trustee; and the holder of any of such Securities shall
thereafter look only to the Corporation for any payment which
such holder may be entitled to collect. Any reference to the
Trustee in this Section 13.04 shall be deemed to also include any
entity designated by the Corporation with the consent of the
Trustee to act as its agent for the performance of all or any of
its duties under this Section.
ARTICLE FOURTEEN
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 14.01. Indenture and Securities Solely Corporate
Obligations. No recourse for the payment of the principal of (or
premium, if any) or interest on any Security, or for any claim
based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the
Corporation in this Indenture or in any supplemental indenture,
or in any Security, or because of the creation of any
indebtedness represented thereby, shall be had against any
incorporator, stockholder, officer or director, as such, past,
present or future, of the Corporation or of any successor
corporation, either directly or through the Corporation or any
successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise; it being expressly understood that all
such liability is hereby expressly waived and released as a
69
<PAGE>
condition of, and as a consideration for, the execution of this
Indenture and the issue of the Securities.
ARTICLE FIFTEEN
SINKING FUNDS
SECTION 15.01. General. Any redemption of Securities of any
series under any sinking fund as required or permitted by the
terms of any Securities duly issued pursuant to this Indenture
shall be made in accordance with such terms and this Article
Fifteen.
The Securities of any series may be subject to redemption
pursuant to a sinking fund, in whole or in part, as set forth in
the form of Security for such series.
The minimum amount of any sinking fund payment provided for
by the terms of Securities of any series is herein referred to as
a "mandatory sinking fund payment," and any payment in excess of
such minimum amount provided for by the terms of Securities of
any series is herein referred to as an "optional sinking fund
payment." If provided for by the terms of Securities of any
series, the cash amount of any sinking fund payment may be
subject to reduction as provided in Section 15.02 hereof. Each
sinking fund payment shall be applied to the redemption of
Securities of any series as provided for by the terms of
Securities of such series.
SECTION 15.02. Satisfaction of Sinking Fund Payments with
Securities. The Corporation (1) may deliver to the Trustee for
cancellation outstanding Securities of a series (other than any
previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the
election of the Corporation pursuant to the terms of such
Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities,
in each case in satisfaction of all or any part of any sinking
fund payment with respect to the Securities of such series
required to be made pursuant to the terms of such Securities as
provided for by the terms of such series; provided that such
Securities have not been previously so credited. Such Securities
shall be received and credited for such purpose by the Trustee at
the redemption price specified in such Securities for redemption
through operation of the sinking fund and the amount of such
sinking fund payment shall be reduced accordingly.
70
<PAGE>
SECTION 15.03. Redemption of Securities for Sinking Fund.
Not less than sixty days prior to each sinking fund payment date
for any series of Securities, the Corporation will deliver to the
Trustee an Officers' Certificate specifying the amount of the
next ensuing sinking fund payment for that series pursuant to the
terms of that series, the portion thereof, if any, which is to be
by payment of cash and the portion thereof, if any, which is to
be satisfied by delivering and crediting Securities of that
series as permitted by Section 15.02 and will also deliver to the
Trustee any Securities to be so delivered if not theretofore
delivered. The Trustee shall select the Securities to be
redeemed upon such sinking fund payment date in the manner
specified in Section 4.03 and cause notice of the redemption
thereof to be given in the manner provided in Section 4.04. Such
notice having been duly given, the redemption of such Securities
shall be made upon the terms and in the manner stated in Sections
4.05 and 4.06.
ARTICLE SIXTEEN
MISCELLANEOUS PROVISIONS
SECTION 16.01. Provisions Binding on Corporation's
Successors. All the covenants, stipulations, promises and
agreements in this Indenture contained by the Corporation shall
bind its successors and assigns whether so expressed or not.
SECTION 16.02. Official Acts by Successor Corporation. Any
act or proceeding by any provision of this Indenture authorized
or required to be done or performed by any board, committee or
officer of the Corporation shall and may be done and performed
with like force and effect by the like board, committee or
officer of any corporation that shall at the time be the lawful
sole successor of the Corporation.
SECTION 16.03. Addresses for Notices, etc. Any notice or
demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the holders
of Securities on the Corporation may be given or served by being
deposited postage prepaid in a post office letter box addressed
(until another address is filed by the Corporation with the
Trustee) to Constellation Energy Corporation, P.O. Box 1475,
Baltimore, Maryland 21203, Attention: Treasurer. Deliveries by
hand may be made by being brought to the Corporation at, 39 W.
Lexington Street, Baltimore, Maryland 21201, Attention:
71
<PAGE>
Treasurer. Any notice, direction, request or demand by any
Securityholder to or upon the Trustee shall be deemed to have
been sufficiently given or made, for all purposes, if given or
made in writing at the Principal Office of the Trustee, addressed
to the attention of its Corporate Trust Department.
SECTION 16.04. Maryland Contract. This Indenture and each
Security shall be deemed to be a contract made under the laws of
the State of Maryland, and for all purposes shall be governed by
and construed in accordance with the laws of said State.
SECTION 16.05. Evidence of Compliance with Conditions
Precedent. Upon any application or demand by the Corporation to
the Trustee to take any action under any of the provisions of
this Indenture, the Corporation shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating
that, in the opinion of such counsel, all such conditions
precedent have been complied with.
Each certificate or opinion provided for in this Indenture
and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture shall
include (1) a statement that the person making such certificate
or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or
investigation upon which the statements or opinion contained in
such certificate or opinion are based; (3) a statement that, in
the opinion of such person, he has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition
has been complied with; and (4) a statement as to whether or not,
in the opinion of such person, such condition or covenant has
been complied with.
SECTION 16.06. Legal Holidays. In any case where the date
of maturity of interest on or premium, if any on, or principal of
the Securities is not a business day, then payment of such
interest on or premium, if any on, or principal of the Securities
need not be made on such date but may be made on the next
succeeding business day with the same force and effect as if made
on the date of maturity and no interest shall accrue for the
period from and after such date of maturity.
72
<PAGE>
SECTION 16.07. Trust Indenture Act to Control. If and to
the extent that any provision of this Indenture limits, qualifies
or conflicts with another provision included in this Indenture
which is required to be included in this Indenture by any of
Sections 310 to 317, inclusive, of the Trust Indenture Act of
1939, such required provision shall control.
SECTION 16.08. Table of Contents, Headings, etc. The table
of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall
in no way modify or restrict any of the terms or provisions
hereof.
SECTION 16.09. Execution in Counterparts. This Indenture
may be executed in any number of counterparts, each of which
shall be an original, but such counterparts shall together
constitute but one and the same instrument.
The Bank of New York, as Trustee, hereby accepts the trusts
in this Indenture declared and provided, upon the terms and
conditions herein above set forth.
IN WITNESS WHEREOF, Constellation Energy Corporation has
caused this Indenture to be signed in its corporate name and
acknowledged by its Chairman of the Board, its Chief Executive
Officer, Vice Chairman, its President or one of its Vice
Presidents and The Bank of New York, Trustee, has caused this
Indenture to be signed and acknowledged by one of its Vice
Presidents or Assistant Vice Presidents, as of the day and year
first written above.
CONSTELLATION ENERGY CORPORATION
By: /s/ David A. Brune [SEAL]
David A. Brune
Vice President
THE BANK OF NEW YORK
By: /s/ Vivian Georges [SEAL]
Vivian Georges
Assistant Vice President
73
<PAGE>
Exhibit 4(b)
REGISTERED REGISTERED
No. [FXR]
[CUSIP]
CONSTELLATION ENERGY CORPORATION
INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND
AND THE COMMONWEALTH OF VIRGINIA
MEDIUM-TERM NOTE, SERIES F
(FIXED-RATE)
[If this Note is registered in the name of The Depository Trust
Corporation (the "Depositary") (55 Water Street, New York, New
York) or its nominee, this Note may not be transferred except as
a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of
the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary
unless and until this Note is exchanged in whole or in part for
Notes in definitive form. Unless this certificate is presented
by an authorized representative of the Depositary to the
Corporation or its agent for registration of transfer, exchange
or payment, and any certificate issued is registered in the name
of Cede & Co. or such other name as requested by an authorized
representative of the Depositary and any payment is made to Cede
& Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co. has an interest herein.]
_________________________________________________________________
PRINCIPAL AMOUNT: _____________________
INTEREST RATE: ______________________
STATED MATURITY: ______________________
ORIGINAL ISSUE DATE: ______________________
ISSUE PRICE: ______________________
REDEEMABLE
AT THE OPTION OF THE REDEMPTION PRICES
CORPORATION ON OR AFTER (% OF PRINCIPAL AMOUNT)
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
<PAGE>
SUBJECT TO REPURCHASE
AT THE OPTION REPURCHASE PRICES
OF THE HOLDER ON (% OF PRINCIPAL AMOUNT)
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
[Remarketing Provisions, if any, to be included here]
_________________________________________________________________
Constellation Energy Corporation, a Maryland and Virginia
corporation (herein called the "Corporation", which term includes
any successor corporation under the Indenture, as hereinafter
defined), for value received, promises to pay to Cede & Co. or
its registered assigns, the principal sum of
_________________________________________________________ DOLLARS
on the Stated Maturity shown above and to pay interest on said
principal sum from the Original Issue Date shown above if
interest has not been paid on this Note or from the most recent
Interest Payment Date for which interest has been paid or duly
provided for, at the fixed rate per annum shown above, semi-
annually on May 1 and November 1 (the "Interest Payment Date(s)")
of each year until the Stated Maturity or upon redemption or
repurchase of this Note. Each payment of interest payable on
each Interest Payment Date and at Stated Maturity or, if
applicable, upon redemption or repurchase shall include interest
to, but excluding the relevant Interest Payment Date and the date
of Stated Maturity or redemption, respectively. Said interest
shall be computed on the basis of a 360-day year of twelve 30-day
months. In the event this Note is issued between a Record Date
(the April 15 and October 15 next preceding the May 1 and
November 1 Interest Payment Dates) and an Interest Payment Date
or on an Interest Payment Date, the first day that interest shall
be payable will be on the Interest Payment Date following the
next succeeding Record Date. In the event of a default in the
payment of interest, interest will be payable as provided in that
certain Indenture dated as of April 4, 1997 (the "Indenture"), by
and between the Corporation and The Bank of New York, a
corporation duly organized and existing under the laws of the
State of New York , as Trustee (herein called the "Trustee,"
which term includes any successor Trustee under the Indenture).
Pursuant to the provisions of the Indenture, the
Corporation will maintain an agency at The Bank of New York in
The City of New York, New York (the "Bank"), or at such other
agencies as may from time to time be designated, where the Notes
may be presented for payment, for registration of transfer and
exchange, and where notices or demands to, or upon, the
Corporation may be served.
The interest so payable on any May 1 or November 1 will,
subject to certain exceptions provided in the Indenture, be paid
to the person in whose name this Note is registered at the close
of business on the Record Date for such Interest Payment Date,
which shall be the April 15 and October 15 next preceding the May
- 2 -
<PAGE>
1 and November 1 Interest Payment Dates; provided, however, that
interest payable at Stated Maturity or, if applicable, upon
redemption or repurchase, shall be payable to the person to whom
principal shall be payable. Payment of the principal of and
interest on this Note will be made at the Bank in U.S. dollars;
provided, however, that payments of interest (other than any
interest payable at Stated Maturity or upon redemption or
repurchase) may be made at the option of the Corporation (i) by
checks mailed to the addresses of the persons entitled thereto as
such addresses shall appear in the register of the Notes or (ii)
by wire transfer to persons who are holders of record at such
other addresses that have been filed with the Bank on or prior to
the Record Date.
Payment of the principal, premium, if any, and interest
payable at Stated Maturity, or, if applicable, upon redemption or
repurchase, on this Note will be made in immediately available
funds at the request of the holder provided that this Note is
presented to the Bank in time for the Bank to make such payments
in such funds in accordance with its normal procedures.
Reference is made to the further provisions of this Note
set forth on the reverse hereof, which shall have the same effect
as though fully set forth at this place.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee or a duly designated
authentication agent by manual signature, this Note shall not be
entitled to any benefit under said Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, Constellation Energy Corporation has
caused this instrument to be executed in its corporate name with
the manual or facsimile signature of its President or a Vice
President and a facsimile of its corporate seal to be imprinted
hereon, attested by the manual or facsimile signature of its
Secretary or an Assistant Secretary.
Dated: _______________
CONSTELLATION ENERGY CORPORATION
By: _____________________________
President
ATTEST: _________________________
[SEAL]
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
herein issued under the Indenture described herein.
THE BANK OF NEW YORK
By: ____________________
Authorized Signatory
- 3 -
<PAGE>
(REVERSE)
CONSTELLATION ENERGY CORPORATION
MEDIUM-TERM NOTE, SERIES F
(FIXED RATE)
This Note is one of a duly authorized issue of debt
securities (the "Securities") of the Corporation, of a series
designated as its Medium-Term Notes, Series E (herein called the
"Notes"), limited (except as otherwise provided in the Indenture)
in aggregate principal amount to $300,000,000, issued and to be
issued under the Indenture, to which Indenture and all relevant
indentures supplemental thereto reference is hereby made for a
statement of the respective rights, obligations, duties and
immunities thereunder of the Corporation, the Trustee, the Bank
and the Securityholders and the terms upon which the Notes are,
and are to be, authenticated and delivered. The Securities, of
which the Notes constitute a series, may be issued in one or more
series, which different series may be issued in various aggregate
principal amounts, may mature at different times, may bear
interest at different rates, may be subject to different
covenants and Events of Default and may otherwise vary as in the
Indenture provided. All capitalized terms not otherwise defined
herein shall have the definitions assigned to them in the
Indenture.
This Note may not be redeemed by the Corporation prior to
Stated Maturity unless otherwise set forth on the face hereof.
Notwithstanding Section 4.03 of the Indenture, pursuant to
Section 4.01 thereof, and if so indicated on the face of this
Note, this Note may be redeemed at the option of the Corporation
on any date on or after the date set forth hereof in whole or in
part in increments of $1,000, at a redemption price or prices
designated on the face hereof to be redeemed together with
interest thereon payable to the date fixed for redemption. This
Note may be so redeemed in whole or in part whether or not other
Notes of the same series are redeemed.
Notice of redemption by the Corporation will be given by
the Corporation by mail to holders of the Notes to be redeemed,
not less than 30 nor more than 60 days prior to the date fixed
for redemption, all as provided in the Indenture. The Bank may
carry out the responsibilities to be performed by the Trustee
required by Article Four of the Indenture.
The Corporation is not required to repurchase Notes from
holders prior to Stated Maturity unless otherwise set forth on
the face hereof. If so indicated on the face hereof, this Note
may be repurchased by the Corporation at the option of the holder
on the dates and at the prices designated thereon, in whole or in
part in increments of $1,000, together with interest payable to
the repurchase date. For book-entry notes, unless otherwise
specified on the face of this Note, holders must deliver written
notice to the Bank at least 30, but no more than 60, days prior
to the date of repurchase, but no later than 5:00 p.m. New York
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<PAGE>
City time on the last day for giving notice. The written notice
must specify the principal amount to be repurchased and must be
signed by a duly authorized officer of the Depositary participant
(signature guaranteed). For definitive notes, unless otherwise
specified on the face of this Note, holders must complete the
"Option to Elect Repayment" on the reverse of this Note and then
deliver this Note to the Bank at least 30, but no more than 45,
days prior to the date of repurchase, but no later than 5:00 p.m.
New York City time on the last day for giving notice. All
notices are irrevocable.
In the event of redemption or repurchase of this Note in
part only, a new Note or Notes of this series, having the same
Stated Maturity, optional redemption or repurchase provisions,
Interest Rate and other terms and provisions of this Note, in
authorized denominations in an aggregate principal amount equal
to the unredeemed portion hereof will be issued in the name of
the holder hereof upon the surrender hereof.
[Remarketing Provisions, if any, to be included here]
The Notes will not be subject to conversion, amortization
or any sinking fund.
As provided in the Indenture and subject to certain
limitations herein and therein set forth, the transfer of this
Note may be registered on the register of the Notes, upon
surrender of this Note for registration of transfer at the Bank,
or at such other agencies as may be designated pursuant to the
Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Trustee or the
Bank duly executed by, the holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes, of
authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or
transferees.
The Notes are issuable only as registered Notes without
coupons in denominations of $1,000 or any amount in excess
thereof that is an integral multiple of $1,000. As provided in
the Indenture, and subject to certain limitations herein and
therein set forth, the Notes are exchangeable for a like
aggregate principal amount of Notes of other authorized
denominations having the same interest rate, Stated Maturity,
optional redemption or repurchase provisions, if any, and
Original Issue Date, as requested by the Securityholder
surrendering the same.
No service charge will be made for any such registration
of transfer or exchange, but the Corporation may require payment
of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The Corporation, the Trustee, the Bank, the Registrar and
any agent of the Corporation, the Trustee, the Bank, or the
Security registrar may treat the Securityholder in whose name
this Note is registered as the absolute owner hereof for the
- 5 -
<PAGE>
purpose of receiving payment as herein provided and for all other
purposes, whether or not this Note is overdue, and neither the
Corporation, the Trustee, the Bank, the Security registrar nor
any such agent shall be affected by notice to the contrary.
If an Event of Default (as defined in the Indenture) with
respect to the Notes shall occur and be continuing, the principal
of all the Notes may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the
rights and obligations of the Corporation and the rights of the
holders of the Securities of any series under the Indenture at
any time by the Corporation with the consent of the holders of
not less than 66 2/3% in aggregate principal amount of the
Securities at the time Outstanding to be affected (voting as one
class). The Indenture also permits the Corporation and the
Trustee to enter into supplemental indentures without the consent
of the holders of Securities of any series for certain purposes
specified in the Indenture, including the making of such other
provisions in regard to matters arising under the Indenture which
shall not adversely affect the interest of the holders of such
Securities. The Indenture also contains provisions permitting
the holders of specified percentages in aggregate principal
amount of the Securities of any series at the time Outstanding,
on behalf of the holders of all the Securities of such series, to
waive compliance by the Corporation with certain provisions of
the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the holder of
this Note shall be conclusive and binding upon such holder and
upon all future holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange herefor or in
lieu hereof whether or not notation of such consent or waiver is
made upon this Note.
The Indenture provides that no holder of any Security of
any series may enforce any remedy with respect to such series
under the Indenture except in the case of refusal or neglect of
the Trustee to act after notice of a continuing Event of Default
and after written request by the holders of not less than 33% in
aggregate principal amount of the Outstanding Securities of such
series and the offer to the Trustee of reasonable indemnity;
PROVIDED, HOWEVER, that such provision shall not prevent the
holder hereof from enforcing payment of the principal of or
interest on this Note.
No reference herein to the Indenture and no provision of
this Note or of the Indenture shall alter or impair the
obligation of the Corporation, which is absolute and
unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein
prescribed.
No recourse shall be had for the payment of the
principal of or the interest on this Note, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect
- 6 -
<PAGE>
of the Indenture or any indenture supplemental thereto, against
any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or any predecessor or
successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, all such liability being, by the
acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
This Note shall be governed by and construed in
accordance with the laws of the State of Maryland.
ASSIGNMENT FORM
To assign this Note, fill in the form below:
Assignee's Social Security or Tax I. D. Number: ________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
________________________________________________________________
_________________________________________________________________
(Print or Type Assignee's Name, Address and Zip Code)
the within Note of the Corporation and hereby does irrevocably
constitute and appoint
_________________________________________________________________
_________________________________________________________________
Attorney to transfer the said Note on the books of the
Corporation, with full power of substitution in the premises.
_________________________
Signature of Assignor
(Sign exactly as name appears on the face of the Note)
Dated: _______________
- 7 -
<PAGE>
HOLDER'S OPTION TO ELECT REPURCHASE
[IN THE CASE OF CERTIFICATED NOTES ONLY]
The undersigned hereby irrevocably requests and instructs the
Corporation to repurchase the within or attached Note (or portion
thereof specified below) pursuant to its terms at a price equal
to ____ % of the principal amount thereof, together with accrued
interest, if any, to the repurchase date, to the undersigned, at
_________________________________________________________________
_________________________________________________________________
(Print or type name, address and phone number of the undersigned)
For the within or attached Note to be repurchased on the
repurchase date, the Bank must receive at least 30, but not more
than 45, days prior to the date of repurchase, but no later than
5:00 p.m. New York City time on the last day for giving notice,
(i) this Note with the "Optional to Elect Repayment" form duly
completed or (ii) a telegram, telex, facsimile transmission or
letter from a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial
bank or a trust Corporation in the United States of America
setting forth the name, address and telephone number of the
holder of such Note, the principal amount of such Note, the
amount of the Note to be repurchased, a statement that the option
to elect repayment is being made thereby and a guarantee that the
Note to be repaid with the form entitled "Option to Elect
Repurchase" on the reverse of such Note duly completed will be
received by the Bank not later than five Business Days after the
date of such telegram, telex, facsimile transmission or letter,
and such Note and form are received by the Bank by such fifth
Business Day.
If less than the entire principal amount of the within or
attached Note is to be repurchased, specify the portion to be
repurchased: $ ______________ and specify the denomination or
denominations of the Note or Notes to be issued to the holder for
the portion of the Note not being repurchased (in the absence of
specific instruction, one such Note will be issued):
$ _____________.
NOTICE: The signature to this Option to Elect Repayment must
correspond with the names as written upon the face of the within
instrument in every particular, without alteration or enlargement
or any change whatever.
_________________________
Signature of Holder
(Sign exactly as name appears on the face of the Note)
Dated: _______________
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<PAGE>
[FRONT]
REGISTERED REGISTERED
No. [FLR]
[CUSIP]
CONSTELLATION ENERGY CORPORATION
INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND
AND THE COMMONWEALTH OF VIRGINIA
MEDIUM-TERM NOTE, SERIES F
(FLOATING RATE)
If this Note is registered in the name of The Depository Trust
Company (the "Depositary") (55 Water Street, New York, New York)
or its nominee, this Note may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of
the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary
unless and until this Note is exchanged in whole or in part for
Notes in definitive form. Unless this certificate is presented
by an authorized representative of the Depositary to the
Corporation or its agent for registration of transfer, exchange
or payment, and any certificate issued is registered in the name
of Cede & Co. or such other name as requested by an authorized
representative of the Depositary and any payment is made to Cede
& Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co. has an interest herein.
_________________________________________________________________
PRINCIPAL AMOUNT: _____________________
INITIAL INTEREST RATE: ______________________
STATED MATURITY: ______________________
INDEX MATURITY: ______________________
SPREAD: ______________________
ORIGINAL ISSUE DATE: ______________________
SPREAD MULTIPLIER: ______________________ %
ISSUE PRICE: ______________________
MAXIMUM INTEREST RATE: ______________________ %
MINIMUM INTEREST RATE: ______________________ %
CALCULATION AGENT: ______________________
<PAGE>
INTEREST PAYMENT DATES:
(Monthly, Quarterly,
Semi-Annually
or Annually) ______________________
INTEREST RESET DATES:
(Daily, Weekly, Monthly,
Quarterly, Semi-Annually
or Annually) ______________________
INTEREST DETERMINATION
DATES: ______________________
CALCULATION DATES: ______________________
INTEREST RATE BASIS (Check One):
_____ CD Rate
_____ Commercial Paper Rate
_____ LIBOR ( _____ Reuters _____ Telerate)
_____ Treasury Rate
_____ Federal Funds Effective Rate
_____ Prime Rate
_____ CMT Rate ( _____ Telerate 7055)
( _____ Telerate 7052)
REDEEMABLE
AT THE OPTION OF THE REDEMPTION PRICES
CORPORATION ON OR AFTER (% OF PRINCIPAL AMOUNT)
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
SUBJECT TO REPURCHASE
AT THE OPTION REPURCHASE PRICES
OF THE HOLDER ON (% OF PRINCIPAL AMOUNT)
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
_________________________ _________________________
________________________________________________________________
Constellation Energy Corporation, a Maryland and Virginia
corporation (herein called the "Corporation" which term includes
any successor corporation under the Indenture, as hereinafter
defined), for value received, promises to pay to Cede & Co. or
its registered assigns, the principal sum of
_________________________________________________________ DOLLARS
on the Stated Maturity shown above and to pay interest on said
principal sum from the Original Issue Date shown above if
interest has not been paid on this Note or from the most recent
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Interest Payment Date for which interest has been paid or duly
provided for until Stated Maturity or, if applicable, upon
redemption or repurchase at the rate per annum determined in
accordance with the provisions on the reverse hereof, depending
on the Interest Rate Basis and the Spread and/or Spread
Multiplier, as the case may be, specified above. Interest will
be payable on each Interest Payment Date and at Stated Maturity
or upon redemption or repurchase. Each payment of interest
payable at Stated Maturity or, if applicable, upon redemption or
repurchase shall include interest to, but excluding the date of
Stated Maturity or redemption or repurchase. In the event this
Note is issued between a Record Date (the date 15 calendar days
prior to each Interest Payment Date whether or not such day shall
be a Business Day) and an Interest Payment Date or on an Interest
Payment Date, the first day that interest shall be payable will
be on the Interest Payment Date following the next succeeding
Record Date. In the event of a default in the payment of
interest, interest will be payable as provided in that certain
Indenture dated as of April 4, 1997(the "Indenture"), by and
between the Corporation and The Bank of New York, a corporation
duly organized and existing under the laws of the State of New
York, as Trustee (herein called the "Trustee," which term
includes any successor Trustee under the Indenture).
Pursuant to the provisions of the Indenture, the
Corporation will maintain an agency at The Bank of New York in
The City of New York, New York (the "Bank"), or at such other
agencies as may from time to time be designated, where the Notes
may be presented for payment, for registration of transfer and
exchange, and where notices or demands to, or upon, the
Corporation may be served.
The interest so payable on the dates specified above
will, subject to certain exceptions provided in the Indenture, be
paid to the person in whose name this Note is registered at the
close of business on the Record Date for such Interest Payment
Date, which shall be the date 15 calendar days prior to each
Interest Payment Date whether or not such day shall be a Business
Day; provided, however, that interest payable at Stated Maturity
or, if applicable, upon redemption or repurchase, shall be
payable to the person to whom principal shall be payable.
Payment of the principal of and interest on this Note will be
made at the Bank in U.S. dollars; PROVIDED, HOWEVER, that
payments of interest (other than any interest payable at Stated
Maturity or upon redemption or repurchase) may be made at the
option of the Corporation (i) by checks mailed to the
addresses of the persons entitled thereto as such addresses shall
appear in the register of the Notes or (ii) by wire transfer to
persons who are holders of record at such other addresses that
have been filed with the Bank on or prior to the Record Date.
Payment of the principal, premium, if any, and interest
payable at Stated Maturity, or, if applicable, upon redemption or
repurchase, on this Note will be made in immediately available
funds at the request of the holder provided that this Note is
presented to the Bank in time for the Bank to make such payments
in such funds in accordance with its normal procedures.
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<PAGE>
Reference is made to the further provisions of this Note
set forth on the reverse hereof, which shall have the same effect
as though fully set forth at this place.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee or a duly designated
authentication agent by manual signature, this Note shall not be
entitled to any benefit under said Indenture, or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, Constellation Energy Corporation has
caused this instrument to be executed in its corporate name with
the manual or facsimile signature of its President or a Vice
President and a facsimile of its corporate seal to be imprinted
hereon, attested by the manual or facsimile signature of its
Secretary or an Assistant Secretary.
Dated: _______________
CONSTELLATION ENERGY CORPORATION
By: _____________________________
President
ATTEST: _________________________
[SEAL]
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated
herein issued under the Indenture described herein.
THE BANK OF NEW YORK
By: ____________________
Authorized Signatory
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<PAGE>
(REVERSE)
CONSTELLATION ENERGY CORPORATION
MEDIUM-TERM NOTE, SERIES F
(FLOATING RATE NOTE)
This Note is one of a duly authorized issue of debt
securities (the "Securities") of the Corporation, of a series
designated as its Medium-Term Notes, Series E (herein called the
"Notes"), limited (except as otherwise provided in the Indenture)
in aggregate principal amount to $300,000,000, issued and to be
issued under the Indenture, to which Indenture and all relevant
indentures supplemental thereto reference is hereby made for a
statement of the respective rights, obligations, duties and
immunities thereunder of the Corporation, the Trustee, the Bank
and the Securityholder and the terms upon which the Notes are,
and are to be, authenticated and delivered. The Securities, of
which the Notes constitute a series, may be issued in one or more
series, which different series may be issued in various aggregate
principal amounts, may mature at different times, may bear
interest at different rates, may be subject to different
covenants and Events of Default and may otherwise vary as in the
Indenture provided. All capitalized terms not otherwise defined
herein shall have the definitions assigned to them in the
Indenture.
Commencing with the applicable Interest Reset Date first
following the Original Issue Date specified on the face hereof,
the rate at which interest on this Note is payable shall be reset
daily, weekly, monthly, quarterly, semi-annually or annually as
shown on the face hereof. The interest rate per annum for each
interest reset period shall be calculated on the applicable
Interest Determination Date specified on the face hereof and
shall be the Interest Rate Basis specified on the face hereof,
determined in accordance with the provisions of the applicable
heading below, adjusted by adding or subtracting a Spread and/or
multiplying by a Spread Multiplier, as the case may be, specified
on the face hereof; provided, however, that (i) the interest
rate in effect from the Original Issue Date to the first Interest
Reset Date with respect to this Note will be the Initial Interest
Rate specified on the face hereof and (ii) the interest rate in
effect for the ten days immediately prior to the Stated Maturity
or redemption or repurchase will be that in effect on the tenth
day preceding such Stated Maturity or redemption or repurchase.
Each such adjusted rate shall be applicable on and after the
Interest Reset Date to which it relates, to, but not including,
the next succeeding Interest Reset Date or until the Stated
Maturity, or the date of redemption or repurchase, as the case
may be. If any Interest Reset Date would otherwise be a day that
is not a Business Day, such Interest Reset Date shall be
postponed to the next succeeding day that is a Business Day (as
defined below), except that if the Interest Rate Basis specified
on the face hereof is LIBOR, and if such Business Day is in the
next succeeding calendar month, such Interest Reset Date shall be
the immediately preceding Business Day. Subject to provisions of
applicable law and except as specified herein, on each Interest
Reset Date the rate of interest on this Note shall be the rate
determined in accordance with the provisions of the applicable
heading below.
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<PAGE>
All percentages resulting from any calculation on this Note
will be rounded, if necessary, to the nearest one hundred-
thousandth of a percentage point, with five one-millionths of a
percentage point rounded upward (e.g., 9.876545% (or .09876545)
would be rounded to 9.87655% (or .0987655)), and all dollar
amounts used in or resulting from such calculation will be
rounded to the nearest cent with one-half cent being rounded
upward.
DETERMINATION OF CD RATE.
If the Interest Rate Basis on this Note is the CD Rate, the
CD Rate with respect to this Note shall equal the rate on each
Interest Determination Date designated on the face hereof for
negotiable certificates of deposit having the Index Maturity
designated on the face hereof as published in H.15(519) under the
heading "CDs (Secondary Market)." In the event that such rate is
not published prior to 9:00 A.M., New York City time, on the
Calculation Date designated on the face hereof pertaining to such
Interest Determination Date, then the CD Rate will be the rate on
such Interest Determination Date for negotiable certificates of
deposit having the Index Maturity as published in Composite
Quotations under the heading "Certificates of Deposit." If such
rate was neither published in H.15(519) by 9:00 A.M., New York
City time, on such Calculation Date nor in Composite Quotations
by 3:00 P.M., New York City time, on such date, the CD Rate for
that CD Interest Determination Date shall be calculated by the
Calculation Agent and shall be the arithmetic mean of the
secondary market offered rates, as of 10:00 A.M., New York City
time, on that Interest Determination Date, of three leading
nonbank dealers of negotiable U.S. dollar certificates of deposit
in The City of New York selected by the Calculation Agent for
negotiable certificates of deposit of major United States money
market banks with a remaining maturity closest to the Index
Maturity in a denomination of $5,000,000; provided, however, that
if fewer than three dealers selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence, the
rate of interest in effect for the applicable period will be the
same as the CD Rate as adjusted for the Spread and/or Spread
Multiplier, as the case may be, for the immediately preceding
interest reset period.
The CD Rate determined with respect to any Interest
Determination Date will become effective on and as of the
applicable Interest Reset Date specified on the face hereof;
provided, however, that (i) the interest rate in effect for the
period from the Original Issue Date to first Interest Reset Date
will be the Initial Interest Rate specified on the face hereof,
and (ii) the interest rate in effect for the ten days immediately
preceding the Stated Maturity or redemption will be that in
effect on the tenth day preceding such Stated Maturity or
redemption.
DETERMINATION OF COMMERCIAL PAPER RATE.
If the Interest Rate Basis on this Note is the Commercial
Paper Rate, the Commercial Paper Rate with respect to this Note
shall equal the Money Market Yield (calculated as described
below) of the rate on each Interest Determination Date designated
on the face hereof for commercial paper having the Index Maturity
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<PAGE>
designated on the face hereof as published in H.15(519) under the
heading "Commercial Paper." In the event that such rate is not
published prior to 9:00 A.M., New York City time, on the
Calculation Date designated on the face hereof pertaining to such
Interest Determination Date, then the Commercial Paper Rate will
be the Money Market Yield of the rate on such Interest
Determination Date for commercial paper having the Index Maturity
as published in Composite Quotations under the heading
"Commercial Paper." If such rate was neither published in
H.15(519) by 9:00 A.M., New York City time, on such Calculation
Date nor in Composite Quotations by 3:00 P.M., New York City
time, on such date, the Commercial Paper Rate for that Interest
Determination Date will be calculated by the Calculation Agent
and will be the Money Market Yield of the arithmetic mean of the
offered rates, as of 11:00 A.M., New York City time, on that
Interest Determination Date, of three leading dealers of
commercial paper in The City of New York selected by the
Calculation Agent for commercial paper having the Index Maturity
designated on the face hereof placed for an industrial issuer
whose bond rating is "AA," or the equivalent, from a nationally
recognized rating agency; provided, however, that if fewer than
three dealers selected as aforesaid by the Calculation Agent are
quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the same as the
Commercial Paper Rate as adjusted for the Spread and/or Spread
Multiplier, as the case may be, for the immediately preceding
interest reset period.
"Money Market Yield" shall be a yield (expressed as a
percentage rounded upwards, if necessary, to the next higher one-
hundred thousandth of a percentage point) calculated in
accordance with the following formula:
Money Market Yield = D x 360
-------------- x 100
360 - (D x M)
where "D" refers to the per annum rate for commercial paper
quoted on a bank discount basis and expressed as a decimal; and
"M" refers to the actual number of days in the period for which
interest is being calculated.
The Commercial Paper Rate determined with respect to any
Interest Determination Date will become effective on and as of
the applicable Interest Reset Date specified on the face hereof;
provided, however, that (i) the interest rate in effect for the
period from the Original Issue Date to the first Interest Reset
Date will be the Initial Interest Rate specified on the face
hereof; and (ii) the interest rate in effect for the ten days
immediately preceding the Stated Maturity or redemption will be
that in effect on the tenth day preceding such Stated Maturity or
redemption.
DETERMINATION OF LIBOR.
If the Interest Rate Basis on this Note is LIBOR, LIBOR with
respect to this Note will be determined by the Calculation Agent
in accordance with the following provisions:
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<PAGE>
(a) With respect to any Interest Determination Date, LIBOR
will be determined by either (i) the arithmetic mean of the
offered rates for deposits in U.S. dollars having the Index
Maturity designated on the face hereof, commencing on the second
Business Day immediately following such Interest Determination
Date, which appear on the Reuters Screen LIBO Page as of 11:00
A.M., London time, on that Interest Determination Date, if at
least two such offered rates appear on the Reuters Screen LIBO
Page, or (ii) the rate for deposits in U.S. dollars having the
Index Maturity designated on the face hereof, commencing on the
second Business Day immediately following such Interest
Determination Date, that appears on the Telerate Page 3750 as of
11:00 a.m., London time, on such Interest Determination Date. If
neither Reuters Screen LIBO Page nor Telerate Page 3750 is
specified on the face hereof, LIBOR will be determined as if
Telerate Page 3750 had been specified.
(b) With respect to an Interest Determination Date on which
fewer than two offered rates appear on the Reuters Screen LIBO
Page or no rate appears on Telerate Page 3750 for the applicable
Index Maturity as described in (a) above, LIBOR will be
determined on the basis of the rates at approximately 11:00 A.M.,
London time, on such Interest Determination Date at which
deposits in U.S. dollars having the Index Maturity designated on
the face hereof are offered to prime banks in the London
interbank market by four major banks in the London interbank
market selected by the Calculation Agent commencing on the second
Business Day immediately following such Interest Determination
Date and in a principal amount not less than $1,000,000 that in
the Calculation Agent's judgment is representative for a single
transaction in such market at such time (a "Representative
Amount"). The Calculation Agent will request the principal
London office of each of such banks to provide a quotation of its
rate. If at least two such quotations are provided, LIBOR for
such Interest Determination Date will be the arithmetic mean of
such quotations. If fewer than two quotations are provided,
LIBOR for such Interest Determination Date will be the arithmetic
mean of the rates quoted at approximately 11:00 A.M., New York
City time, on such Interest Determination Date by three major
banks in The City of New York, selected by the Calculation Agent,
for loans in U.S. dollars to leading European banks having the
specified Index Maturity commencing on the second Business Day
immediately following such Interest Determination Date and in a
Representative Amount; provided, however, that if fewer than
three banks selected as aforesaid by the Calculation Agent are
quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the same as LIBOR as
adjusted for the Spread and/or Spread Multiplier, as the case may
be, for the immediately preceding interest reset period.
LIBOR determined with respect to any Interest Determination
Date will become effective on and as of the applicable Interest
Reset Date specified on the face hereof; provided, however, that
(i) the interest rate in effect for the period from the Original
Issue Date to the first Interest Reset Date will be the Initial
Interest Rate specified on the face hereof and (ii) the interest
rate in effect for the ten days immediately preceding the Stated
Maturity or redemption will be that in effect on the tenth day
preceding such Stated Maturity or redemption.
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<PAGE>
DETERMINATION OF FEDERAL FUNDS EFFECTIVE RATE.
If the Interest Rate Basis on this Note is the Federal Funds
Effective Rate, the Federal Funds Effective Rate with respect to
this Note shall equal with respect to each Interest Determination
Date designated on the face hereof the rate on such date for
Federal Funds as published in H.15(519) under the heading
"Federal Funds (Effective)" or, if not so published prior to
11:00 A.M., New York City time, on the Calculation Date
designated on the face hereof pertaining to such Interest
Determination Date, then the Federal Funds Effective Rate will be
the rate on such Interest Determination Date as published in
Composite Quotations under the heading "Federal Funds/Effective
Rate." If such rate was neither published in H.15(519) by 11:00
A.M., New York City time, on such Calculation Date nor in
Composite Quotations by 3:00 P.M., New York City time, on such
date, the Federal Funds Effective Rate for such Interest
Determination Date will be calculated by the Calculation Agent
and will be the arithmetic mean of the rates, as of 11:00 A.M.,
New York City time, on that Interest Determination Date, for the
last transaction in overnight Federal Funds arranged by three
leading brokers of Federal Funds transactions in The City of New
York selected by the Calculation Agent; provided, however, that
if fewer than three brokers selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence, the
rate of interest in effect for the applicable period will be the
same as the Federal Funds Effective Rate as adjusted for the
Spread and/or Spread Multiplier, as the case may be, for the
immediately preceding interest reset period.
The Federal Funds Effective Rate determined with respect to
any Interest Determination Date will become effective on and as
of the applicable Interest Reset Date specified on the face
hereof; provided, however, that (i) the interest rate in effect
for the period from the Original Issue Date to the first Interest
Reset Date will be the Initial Interest Rate specified on the
face hereof; and (ii) the interest rate in effect for the ten
days immediately preceding the Stated Maturity or redemption will
be that in effect on the tenth day preceding such Stated Maturity
or redemption.
DETERMINATION OF PRIME RATE.
If the Interest Rate Basis on this Note is the Prime Rate,
the Prime Rate with respect to the Note shall equal with respect
to each Interest Determination Date designated on the face hereof
the rate set forth on such date in H.15(519) under the heading
"Bank Prime Loan." In the event that such rate is not published
prior to 9:00 A.M., New York City time, on the Calculation Date
designated on the face hereof pertaining to such Interest
Determination Date, then the Prime Rate will be the arithmetic
mean (rounded upwards, if necessary, to the next higher one-
hundred thousandth of a percentage point) of the rates of
interest publicly announced by each bank that appear on the
Reuters Screen NYMF Page as such bank's prime rate or base
lending rate as in effect for that Interest Determination Date.
If fewer than four such rates but more than one such rate appear
on the Reuters Screen NYMF Page for the Interest Determination
Date, the Prime Rate will be the arithmetic mean of the prime
rates (quoted on the basis of the actual number of days in the
year divided by a 360-day year) as of the close of business on
such Interest Determination Date by four major money center banks
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<PAGE>
in The City of New York selected by the Calculation Agent. If
fewer than two quotations are provided, the Prime Rate shall be
determined on the basis of the rates furnished in The City of New
York by the appropriate number of substitute banks or trust
companies organized and doing business under the laws of the
United States, or any State thereof, having total equity capital
of at least $500 million and being subject to supervision or
examination by a Federal or State authority, selected by the
Calculation Agent to provide such rate or rates; provided,
however, that if the banks selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence,
the rate of interest in effect for the applicable period will be
the same as the Prime Rate as adjusted for the Spread and/or
Spread Multiplier, as the case may be, for the immediately
preceding interest reset period.
The Prime Rate determined with respect to any Interest
Determination Date will become effective on and as of the
applicable Interest Reset Date specified on the face hereof;
provided, however, that (i) the interest rate in effect for the
period from the Original Issue Date to the first Interest Reset
Date will be the Initial Interest Rate specified on the face
hereof; and (ii) the interest rate in effect for the ten days
immediately preceding the Stated Maturity or redemption will be
that in effect on the tenth day preceding such Stated Maturity or
redemption.
DETERMINATION OF TREASURY RATE.
If the Interest Rate Basis on this Note is the Treasury
Rate, the Treasury Rate with respect to this Note shall equal
with respect to each Interest Determination Date designated on
the face hereof the rate for the most recent auction of direct
obligations of the United States ("Treasury bills") having the
Index Maturity designated on the face hereof as published in
H.15(519) under the heading, "U.S. Government Securities/Treasury
Bills/Auction Average (Investment)" or, if not so published by
9:00 A.M., New York City time, on the Calculation Date designated
on the face hereof pertaining to such Interest Determination
Date, the auction average rate (expressed as a bond equivalent,
on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) for such auction as otherwise announced
by the United States Department of the Treasury. In the event
that the results of the auction of Treasury bills having the
Index Maturity designated on the face hereof are neither
published in H.15(519) by 9:00 A.M., New York City time, on such
Calculation Date, nor otherwise published or reported as provided
above by 3:00 P.M., New York City time on such date, or if no
such auction is held in a particular week, then the Treasury Rate
shall be calculated by the Calculation Agent and shall be a yield
to maturity (expressed as a bond equivalent, on the basis of a
year of 365 or 366 days, as applicable, and applied on a daily
basis) of the arithmetic mean of the secondary market bid rates
as of approximately 3:30 P.M., New York City time, on such
Interest Determination Date, of three leading primary United
States government securities dealers in The City of New York
selected by the Calculation Agent, for the issue of Treasury
bills with a remaining maturity closest to the specified Index
Maturity; provided, however, that if fewer than three dealers
selected as aforesaid by the Calculation Agent are quoting as
mentioned in this sentence, the rate of interest in effect for
the applicable period will be the same as the Treasury Rate as
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adjusted for the Spread and/or Spread Multiplier, as the case may
be, for the immediately preceding interest reset period.
The Treasury Rate determined with respect to any Interest
Determination Date will become effective on and as of the
applicable Interest Reset Date specified on the face hereof;
provided, however, that (i) the interest rate in effect for the
period from the Original Issue Date to the first Interest Reset
Date will be the Initial Interest Rate specified on the face
hereof; and (ii) the interest rate in effect for the ten days
immediately preceding the Stated Maturity or redemption will be
that in effect on the tenth day preceding such Stated Maturity or
redemption.
DETERMINATION OF CMT RATE
If the Interest Rate Basis on this Note is the CMT Rate, the
CMT Rate with respect to this Note shall equal with respect to
each Interest Determination Date designated on the face hereof
the rate displayed on the Designated CMT Telerate Page under the
caption "...Treasury Constant Maturities.. Federal Reserve Board
Release H.15... Mondays Approximately 3:45 P.M.," under the
column for the Index Maturity designated on the face hereof (i)
if the Designated CMT Telerate Page is 7055, the rate for the
applicable Interest Determination Date and (ii) if the Designated
CMT Telerate Page is 7052, the week, or the month, as applicable,
ended immediately preceding the week in which the Interest
Determination Date occurs. If no page is specified on the face
hereof, the Designated CMT Telerate Page shall be 7052, for the
most recent week. If such rate is no longer displayed on the
relevant page, or if not displayed by 3:00 P.M., New York City
time, on the related Calculation Date, then the CMT Rate for such
Interest Determination Date will be such Treasury Constant
Maturity rate for the Index Maturity designated on the face
hereof as published in the relevant H.15 (519). If such rate is
no longer published, or if not published by 3:00 P.M., New York
City time, on the related Calculation Date, then the CMT Rate for
such Interest Determination Date will be such Treasury Constant
Maturity rate for the Index Maturity on the face hereof (or other
United States Treasury rate for such Index Maturity for that
Interest Determination Date with respect to such Interest Reset
Date) as may then be published by either the Federal Reserve
Board or the United States Department of the Treasury that the
Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and
published in the relevant H.15(519). If such information is not
provided by 3:00 P.M., New York City time, on the related
Calculation Date, then the CMT Rate for that Interest
Determination Date will be calculated by the Calculation Agent
and will be a yield to maturity, based on the arithmetic mean of
the secondary market closing offer side prices as of
approximately 3:30 P.M. (New York City time) on that Interest
Determination Date reported, according to their written records,
by three leading primary United States government securities
dealers (each, a "Reference Dealer") in The City of New York
selected by the Calculation Agent (from five such Reference
Dealers selected by the Calculation Agent and eliminating the
highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States
("Treasury Note") with an original maturity of approximately the
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Index Maturity designated on the face hereof and a remaining term
to maturity of not less than such Index Maturity minus one year.
If two Treasury Notes with an original maturity as described in
the preceding sentence have remaining terms to maturity equally
close to the Index Maturity designated on the face hereof, the
quotes for the Treasury Note with the shorter remaining term to
maturity will be used. If the Calculation Agent cannot obtain
three such Treasury Note quotations, the CMT Rate for that
Interest Determination Date will be calculated by the Calculation
Agent and will be a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of
approximately 3:30 P.M. (New York City time) on that Interest
Determination Date of three Reference Dealers in The City of New
York (from five such Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation (or, in
the event of equality, one of the highest) and the lowest
quotation (or, in the event of equality, one of the lowest)), for
Treasury Notes with an original maturity of the number of years
that is the next highest to the Index Maturity designated on the
face hereof and a remaining term to maturity closest to such
Index Maturity and in an amount of at least $100 million. If
three or four (and not five) of such Reference Dealers are
quoting as described above, then the CMT Rate will be based on
the arithmetic mean of the offer prices obtained and neither the
highest nor the lowest of such quotes will be eliminated;
provided, however, that if fewer than three Reference Dealers
selected by the Calculation Agent are quoting as described
herein, the rate of interest in effect for the applicable period
will be the same as the CMT Rate as adjusted for the Spread
and/or Spread Multiplier, as the case may be, for the immediately
preceding Interest Reset Period.
The CMT Rate determined with respect to any Interest
Determination Date will become effective on and as of the
applicable Interest Reset Date specified on the face hereof;
provided, however, that (i) the interest rate in effect for the
period from the Original Issue Date to the first Interest Reset
Date will be the Initial Interest Rate specified on the face
hereof; and (ii) the interest rate, in effect for the ten days
immediately preceding the Stated Maturity or redemption will be
that in effect on the tenth day preceding such Stated Maturity or
redemption.
Notwithstanding the foregoing, the interest rate hereon
shall not be greater than the Maximum Interest Rate, if any, or
less than the Minimum Interest Rate, if any, shown on the face
hereof. The Calculation Agent shall calculate the interest rate
on this Note in accordance with the foregoing on each Interest
Determination Date.
The Interest Rate on this Note will in no event be higher
than the maximum rate permitted by Maryland law as the same may
be modified by the United States law of general applicability.
The Calculation Agent will, upon the request of the Holder
of this Note provide to such Holder the interest rate hereon then
in effect and, if different, the interest rate which will become
effective as of the next applicable Interest Reset Date.
If any Interest Payment Date specified on the face hereof
would otherwise be a day that is not a Business Day, the Interest
Payment Date shall be postponed to the next day that is a
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<PAGE>
Business Day, except that if (i) the rate of interest on this
Note shall be determined in accordance with the provisions of the
heading "Determination of LIBOR" above, and (ii) such Business
Day is in the next succeeding calendar month, such Interest
Payment Date shall be the immediately preceding Business Day.
"Business Day" means any day other than a Saturday or Sunday that
(a) is not a day on which banking institutions in Baltimore,
Maryland, or in New York, New York, are authorized or obligated
by law or executive order to be closed, and (b) with respect to
LIBOR Notes only, is a day on which dealings in deposits in U.S.
dollars are transacted in the London interbank market.
Interest payments for this Note will include interest accrued
to but excluding the Interest Payment Dates; provided, however,
that if the Interest Reset Dates with respect to this Note are
daily or weekly, interest payable on any Interest Payment Date,
other than interest payable on any date on which principal hereof
is payable, will include interest accrued to and including the
Record Date next preceding such Interest Payment Date. Accrued
interest hereon from the Original Issue Date or from the last
date to which interest hereon has been paid, as the case may be,
shall be an amount calculated by multiplying the face amount
hereof by an accrued interest factor. Such accrued interest
factor shall be computed by adding the interest factor calculated
for each day from the Original Issue Date or from the last date
to which interest shall have been paid, as the case may be, to
the date for which accrued interest is being calculated. The
interest factor (expressed as a decimal rounded upwards, if
necessary, to the next higher one hundred-thousandth of a
percentage point) for each such day shall be computed by dividing
the interest rate (expressed as a decimal, rounded upwards, if
necessary, to the next higher one hundred-thousandth of a
percentage point) applicable to each such day by 360, in the case
of the Commercial Paper Rate, CD Rate, LIBOR, Federal Funds
Effective Rate or Prime Rate, or by the actual number of days in
the year in the case of the Treasury Rate or the CMT Rate.
This Note may not be redeemed by the Corporation prior to
Stated Maturity unless otherwise set forth on the face hereof.
Notwithstanding Section 4.03 of the Indenture, pursuant to
Section 4.01 thereof, and if so indicated on the face of this
Note, this Note may be redeemed at the option of the Corporation,
on any date on or after the date set forth hereof in whole or in
part in increments of $1,000, at a redemption price or prices
designated on the face hereof to be redeemed together with
interest thereon payable to the date fixed for redemption. This
Note may be so redeemed in whole or in part whether or not other
Notes of the same series are redeemed.
Notice of redemption or repurchase will be given by the
Corporation by mail to holders of the Notes to be redeemed, not
less than 30 nor more than 60 days prior to the date fixed for
redemption, all as provided in the Indenture. The Bank may carry
out the responsibilities to be performed by the Trustee required
by Article Four of the Indenture.
The Corporation is not required to repurchase Notes from
holders prior to Stated Maturity unless otherwise set forth on
the face hereof. If so indicated on the face hereof, this Note
- 13 -
<PAGE>
may be repurchased by the Corporation at the option of the holder
on the dates and at the prices designated thereon, in whole or in
part in increments of $1,000, together with interest payable to
the repurchase date. For book-entry notes, unless otherwise
specified on the face of this Note, holders must deliver written
notice to the Bank at least 30, but no more than 60, days prior
to the date of repurchase, but no later than 5:00 p.m. New York
City time on the last day for giving notice. The written notice
must specify the principal amount to be repurchased and must be
signed by a duly authorized officer of the Depositary participant
(signature guaranteed). For definitive notes, unless otherwise
specified on the face of this Note, holders must complete the
"Option to Elect Repayment" on the reverse of this Note and then
deliver this Note to the Bank at least 30, but no more than 45,
days prior to the date of repurchase, but no later than 5:00 p.m.
New York City time on the last day for giving notice. All
notices are irrevocable.
In the event of redemption or repurchase of this Note in
part only, a new Note or Notes of this series, having the same
Stated Maturity, optional redemption or repurchase provisions,
Interest Rate and other terms and provisions of this Note, in
authorized denominations in an aggregate principal amount equal
to the unredeemed portion hereof will be issued in the name of
the holder hereof upon the surrender hereof.
The Notes will not be subject to conversion, amortization
or any sinking fund.
As provided in the Indenture and subject to certain
limitations herein and therein set forth, the transfer of this
Note may be registered on the register of the Notes, upon
surrender of this Note for registration of transfer at the Bank,
or at such other agencies as may be designated pursuant to the
Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Trustee or the
Bank duly executed by, the holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes, of
authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or
transferees.
The Notes are issuable only as registered Notes without
coupons in denominations of $1,000 or any amount in excess
thereof that is an integral multiple of $1,000. As provided in
the Indenture, and subject to certain limitations herein and
therein set forth, the Notes are exchangeable for a like
aggregate principal amount of Notes of other authorized
denominations having the same Interest Rate, Stated Maturity,
optional redemption or repurchase provisions, if any, and
Original Issue Date, as requested by the Securityholder
surrendering the same.
No service charge will be made for any such registration
of transfer or exchange, but the Corporation may require payment
of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
- 14 -
<PAGE>
The Corporation, the Trustee, the Bank, the Registrar and
any agent of the Corporation, the Trustee, the Bank, or the
Security registrar may treat the Securityholder in whose name
this Note is registered as the absolute owner hereof for the
purpose of receiving payment as herein provided and for all other
purposes, whether or not this Note is overdue, and neither the
Corporation, the Trustee, the Bank, the Registrar nor any such
agent shall be affected by notice to the contrary.
If an Event of Default (as defined in the Indenture) with
respect to the Notes shall occur and be continuing, the principal
of all the Notes may be declared due and payable in the manner
and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the
rights and obligations of the Corporation and the rights of the
holders of the Securities of any series under the Indenture at
any time by the Corporation with the consent of the holders of
not less than 66 2/3% in aggregate principal amount of the
Securities at the time outstanding to be affected (voting as one
class). The Indenture also permits the Corporation and the
Trustee to enter into supplemental indentures without the consent
of the holders of Securities of any series for certain purposes
specified in the Indenture, including the making of such other
provisions in regard to matters arising under the Indenture which
shall not adversely affect the interest of the holders of such
Securities. The Indenture also contains provisions permitting
the holders of specified percentages in aggregate principal
amount of the Securities of any series at the time outstanding,
on behalf of the holders of all the Securities of such series, to
waive compliance by the Corporation with certain provisions of
the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the holder of
this Note shall be conclusive and binding upon such holder and
upon all future holders of this Note and of any Note issued upon
the registration of transfer hereof or in exchange herefor or in
lieu hereof whether or not notation of such consent or waiver is
made upon this Note.
The Indenture provides that no holder of any Security of
any series may enforce any remedy with respect to such series
under the Indenture except in the case of refusal or neglect of
the Trustee to act after notice of a continuing Event of Default
and after written request by the holders of not less than 33% in
aggregate principal amount of the outstanding Securities of such
series and the offer to the Trustee of reasonable indemnity;
provided, however, that such provision shall not prevent the
holder hereof from enforcing payment of the principal of or
interest on this Note.
No reference herein to the Indenture and no provision of
this Note or of the Indenture shall alter or impair the
obligation of the Corporation, which is absolute and
unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein
prescribed.
- 15 -
<PAGE>
No recourse shall be had for the payment of the principal
of or the interest on this Note, or for any claim based hereon,
or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any
incorporator, stockholder, officer or director, as such, past,
present or future, of the Corporation or any predecessor or
successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment
or penalty or otherwise, all such liability being, by the
acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
This Note shall be governed by and construed in
accordance with the laws of the State of Maryland.
- 16 -
<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below:
Assignee's Social Security or Tax I. D. Number: ________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
________________________________________________________________
_________________________________________________________________
(Print or Type Assignee's Name, Address and Zip Code)
the within Note of the Corporation and hereby does irrevocably
constitute and appoint
_________________________________________________________________
_________________________________________________________________
Attorney to transfer the said Note on the books of the
Corporation, with full power of substitution in the premises.
_________________________
Signature of Assignor
(Sign exactly as name appears on the face of the Note)
Dated: _______________
- 17 -
<PAGE>
[HOLDER'S OPTION TO ELECT REPURCHASE]
[IN THE CASE OF CERTIFICATED NOTES ONLY]
The undersigned hereby irrevocably requests and instructs the
Corporation to repurchase the within or attached Note (or portion
thereof specified below) pursuant to its terms at a price equal
to ___ % of the principal amount thereof, together with accrued
interest, if any, to the repurchase date, to the undersigned, at
_________________________________________________________________
_________________________________________________________________
(Print or type name, address and phone number of the undersigned)
For the within or attached Note to be repurchased on the
repurchase date, the Bank must receive at least 30, but not more
than 45, days prior to the date of repurchase, but no later than
5:00 p.m. New York City time on the last day for giving notice,
(i) this Note with the "Optional to Elect Repayment" form duly
completed or (ii) a telegram, telex, facsimile transmission or
letter from a member of a national securities exchange or the
National Association of Securities Dealers, Inc. or a commercial
bank or a trust Corporation in the United States of America
setting forth the name, address and telephone number of the
holder of such Note, the principal amount of such Note, the
amount of the Note to be repurchased, a statement that the option
to elect repayment is being made thereby and a guarantee that the
Note to be repaid with the form entitled "Option to Elect
Repurchase" on the reverse of such Note duly completed will be
received by the Bank not later than five Business Days after the
date of such telegram, telex, facsimile transmission or letter,
and such Note and form are received by the Bank by such fifth
Business Day.
If less than the entire principal amount of the within or
attached Note is to be repurchased, specify the portion to be
repurchased: $ ______________ and specify the denomination or
denominations of the Note or Notes to be issued to the holder for
the portion of the Note not being repurchased (in the absence of
specific instruction, one such Note will be issued):
$ _____________.
NOTICE: The signature to this Option to Elect Repayment must
correspond with the names as written upon the face of the within
instrument in every particular, without alteration or enlargement
or any change whatever.
_________________________
Signature of Holder
(Sign exactly as name appears on the face of the Note)
Dated: _______________
- 18 -
<PAGE>
Exhibit 5(a)
DONNA M. LEVY
Counsel
Baltimore Gas and Electric Company
P.O. Box 1475
Baltimore, Maryland 21203-1475
410 234-5598
[BGE LOGO]
April 7, 1997
Constellation Energy Corporation
c/o David A. Brune
Baltimore Gas and Electric Company
39 W. Lexington Street
Baltimore, Maryland 21201
Gentlemen:
This opinion is provided in connection with the registration statement (the
"Registration Statement") being filed by Constellation Energy Corporation
("Constellation Energy") with the Securities and Exchange Commission ("SEC")
under the Securities Act of 1933, regarding the proposed issuance of up to
$300,000,000 principal amount of Medium Term Notes, Series F (the "Notes").
Pursuant to an Agreement and Plan of Merger dated September 22, 1995, among
Constellation Energy (formerly RH Acquisition Corp), Baltimore Gas and Electric
Company (BGE) and Potomac Electric Power Company (PEPCO), upon the occurrence of
certain events BGE and PEPCO will merge into Constellation Energy. In
anticipation of the consummation of the merger, Constellation Energy is filing
this Registration Statement in regard to the Notes to be offered upon
effectiveness of the merger.
I am an attorney in the Corporate Unit of the legal department of BGE, a
Maryland corporation. BGE is a shareholder of Constellation Energy, and
Constellation Energy has requested that I provide this opinion. I am licensed to
practice law in the State of Maryland. I have relied upon the opinion of Piper &
Marbury L.L.P. as to matters of Virginia law. In connection with this opinion I,
together with other attorneys assisting me have considered, among other things
(1) the current articles of incorporation of Constellation Energy, as amended,
and a form of amended and restated articles of incorporation of Constellation
Energy (the "Charter" ) to be filed and effective upon consummation of the
merger; (2) the current by-laws of Constellation Energy, and a form of by-laws
of Constellation Energy to be adopted effective upon consummation of the merger;
(3) the Indenture dated as of April 4, 1997 from the Company to The Bank of New
York under which the Notes will be issued; (4) Constellation Energy's
application to the Public Service Commission of Maryland ("Maryland Commission")
to be filed soon requesting authorization for the issuance
<PAGE>
April 7, 1997
Page 2
and sale of the Notes; (5) Constellation Energy's application to the Public
Service Commission of the District of Columbia ("District of Columbia
Commission") filed February 14, 1997 requesting authorization for the issuance
and sale of the Notes; (6) the Registration Statement; (7) the agency agreement
(including the standard purchase provisions) filed as exhibits to the
Registration Statement (the "Purchase Agreement"); (8) the provisions of the
Public Utility Holding Company Act of 1935 (the "1935 Act"); (9) the opinion of
Piper & Marbury L.L.P. dated April 7, 1997 concerning the applicability and
effect of Virginia law to the matters covered in this opinion; and (10) such
other documents, transactions, and matters of law as we deemed necessary in
order to render this opinion.
This opinion is subject to: (1) the merger becoming effective and the
filing with the appropriate State authorities, and effectiveness of,
Constellation Energy's Charter; (2) the Registration Statement becoming
effective under the Securities Act of 1933; (3) issuance by the Maryland
Commission and the District of Columbia Commission of orders authorizing the
issuance and sale by Constellation Energy of the Notes; (4) appropriate
resolutions being adopted by the Constellation Energy Board of Directors in
regard to the issuance of the Notes; (5) the proper execution, authentication,
and delivery of the Notes upon receipt of the purchase price pursuant to the
Purchase Agreement; and (6) the qualification of the Indenture under the Trust
Indenture Act of 1939.
Based on the foregoing, I am of the opinion that the
Notes, when issued and delivered pursuant to the Purchase
Agreement, will constitute legally issued and binding
obligations of Constellation Energy.
The opinion expressed herein concerns only the effect
of the law (excluding the principles of conflicts of law) of
the State of Maryland and the United States of America as
currently in effect and, to the extent covered in the Piper
& Marbury L.L.P. opinion, the law of the Commonwealth of
Virginia.
This opinion is provided solely for your benefit and
may not be relied upon by, or quoted to, any other person or
entity, in whole or in part, without my prior written
consent.
I hereby consent to the filing of this opinion as an
exhibit to the Registration Statement. I am the in-house
attorney referred to in the Registration Statement and I
consent to the references to me in the Registration
Statement (and any amendments thereto) or the prospectus
constituting a part of the Registration Statement (and any
amendments or supplements thereto).
Very truly yours,
/s/ Donna M. Levy
<PAGE>
Exhibit 5(b)
PIPER & MARBURY
L.L.P.
1200 NINETEENTH STREET, N.W.
Washington, D.C. 20036-2430
202-861-3900
FAX: 202-223-2085
BALTIMORE
NEW YORK
PHILADELPHIA
EASTON
April 7, 1997
Constellation Energy Corporation
c/o David A. Brune
Baltimore Gas and Electric Company
39 West Lexington Street
Baltimore, Maryland 2l201
Re: Registration Statement on Form S-3
Dear Sirs:
We have acted as counsel to Constellation Energy
Corporation, (the "Company"), in connection with the registration
under the Securities Act of 1933, as amended (the "Act") for the
proposed issuance of up to $300,000,000 principal amount of
Medium Term Notes, Series F (the "Notes"). The Notes are being
registered on Registration Statement on Form S-3 (the
"Registration Statement") to be filed by the Company with the
Securities and Exchange Commission (the "Commission").
We have reviewed the Company's Amended and Restated Articles
of Incorporation (the "Charter"), and its by-laws (the "By-
Laws"), which we have been advised will be effective as of the
effective time of the merger among Baltimore Gas and Electric
Company, Potomac Electric Power Company and the Company. We have
reviewed (i) the Registration Statement, (ii) the Indenture dated
as of April 4, 1997, from the Company to The Bank of New York
under which the Notes will be issued and (iii) the Agency
Agreement (including the standard purchase provisions) filed as
an exhibit to the Registration Statement (the "Purchase
Agreement") and have examined and relied upon such corporate
records of the Company and other documents and certificates as to
factual matters as we have deemed necessary or appropriate for
the purpose of rendering the opinion expressed herein. We have
assumed, without independent verification, the genuineness of the
signatures on and the authenticity of all documents furnished to
us by the Company.
<PAGE>
Constellation Energy Corporation
April 7, 1997
Page 2
Based upon the foregoing, we are of the opinion and advise
you that the Notes, when issued and delivered pursuant to the
Purchase Agreement, will constitute legally issued and binding
obligations of the Company.
The opinion expressed herein concerns only the effect of the
law (excluding the principles of conflicts of law) of the
Commonwealth of Virginia and the United States of America.
This opinion is provided solely for your benefit and may not
be relied upon by, or quoted to, any other person or entity, in
whole or in part, without our prior written consent except that
Donna M. Levy may rely upon this opinion in rendering her opinion
to you dated today regarding the Notes.
We hereby consent to the filing of this opinion with the
Securities and Exchange Commission as an Exhibit to the
Registration Statement and to the use of our name under the
caption "Legal Matters" in the Prospectus and any amendments
thereto.
Very truly yours,
/s/ Piper & Marbury L.L.P.
<PAGE>
Exhibit 12
CONSTELLATION ENERGY CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED AND PREFERENCE DIVIDEND REQUIREMENTS
(Thousands of Dollars)
<TABLE>
December December December December December
1996 1995 1994 1993 1992
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Net Income ................................................... $ 547,784 $ 432,398 $ 550,779 $ 551,445 $ 465,107
Taxes on Income .............................................. 249,588 216,119 250,655 202,978 185,475
---------- ---------- ---------- ---------- ----------
Adjusted Net Income .......................................... $ 797,372 $ 648,517 $ 801,434 $ 754,423 $ 650,582
---------- ---------- ---------- ---------- ----------
Fixed Charges:
Interest and Amortization of Debt Discount
and Expense and Premium on all Indebtedness ......... $ 434,303 $ 444,861 $ 428,199 $ 418,668 $ 425,101
Capitalized Interest ................................... 16,313 15,579 12,948 18,226 16,000
Interest Factor in Rentals ............................. 25,491 28,784 11,948 11,401 8,632
---------- ---------- ---------- ---------- ----------
Total Fixed Charges .................................... $ 476,107 $ 489,224 $ 453,095 $ 448,295 $ 449,733
---------- ---------- ---------- ---------- ----------
Preferred and Preference
Dividend Requirements:
Preferred and Preference Dividends ..................... $ 55,140 $ 57,429 $ 56,359 $ 58,094 $ 56,639
Income Tax Required .................................... 26,494 28,185 25,813 22,989 22,486
Total Preferred and Preference
---------- ---------- ---------- ---------- ----------
Dividend Requirements ............................... $ 81,634 $ 85,614 $ 82,172 $ 81,083 $ 79,125
---------- ---------- ---------- ---------- ----------
Total Fixed Charges and Preferred
and Preference Dividend Requirements ................... $ 557,741 $ 574,838 $ 535,267 $ 529,378 $ 528,858
========== ========== ========== ========== ==========
Earnings (1) ................................................. $1,257,166 $1,122,162 $1,241,581 $1,184,492 $1,084,315
========== ========== ========== ========== ==========
Ratio of Earnings to Fixed Charges ........................... 2.64 2.29 2.74 2.64 2.41
Ratio of Earnings to Combined Fixed
Charges and Preferred and Preference
Dividend Requirements .................................. 2.25 1.95 2.32 2.24 2.05
(1) Earnings consist of adjusted net income and total fixed charges excluding capitalized interest.
</TABLE>
<PAGE>
Exhibit 23(c)
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We consent to the incorporation by reference in this Registration
Statement on Form S-3 covering $300,000,000 of Constellation
Energy Corporation Medium-Term Notes, Series F (the "Registration
Statement") of our report dated January 17, 1997, on our audits
of the consolidated financial statements and financial statement
schedule included on Form 10-K of Baltimore Gas and Electric
Company and Subsidiaries as of December 31, 1996 and 1995 and for
the three years ended December 31, 1996.
We also consent to the reference to our firm under the caption
"Experts" in this Registration Statement.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Baltimore, Maryland
April 4, 1997
<PAGE>
Exhibit 23(d)
Consent of Independent Accountants
__________________________________
We hereby consent to the incorporation by reference in the
Prospectus constituting part of this Registration Statement on
Form S-3 of our report dated January 17, 1997, which appears on
page 32 of the 1996 Annual Report to Shareholders of Potomac
Electric Power Company, which is incorporated by reference in
Potomac Electric Power Company's Annual Report on Form 10-K for
the year ended December 31, 1996. We also consent to the
incorporation by reference of our report on the Financial
Statement Schedule, which appears on page 66 of such Annual
Report on Form 10-K. We also consent to the reference to us
under the heading "Experts" in such Prospectus.
/s/ Price Waterhouse LLP
Washington, D.C.
April 7, 1997
Exhibit 24
CONSTELLATION ENERGY CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned
directors and officers of Constellation Energy Corporation hereby
constitute and appoint David A. Brune their true and lawful
attorney and agent to do any and all acts and things and to
execute, in their name any and all instruments which said
attorney and agent may deem necessary or advisable to enable said
corporation to comply with the Securities Act of 1933, as
amended, and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof in
connection with the registration under said Act on Form S-3 of
$300,000,000 principal amount of Medium-Term Notes, Series F of
Constellation Energy Corporation maturing not more that thirty
years after the date as of which they are issued including
specifically, but without limiting the generality of the
foregoing, power and authority to sign the names of the
undersigned directors and officers in the capacities indicated
below, to any registration statements to be filed with the
Securities and Exchange Commission in respect to said Medium-Term
Notes, Series F, to any and all amendments to any registration
statement in respect to said Medium-Term Notes, Series F and to
any instruments or documents filed as part of or in connection
with said registration statements or amendments thereto; and each
of the undersigned hereby ratifies and confirms all that said
attorney and agent, shall do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed,
or caused to be subscribed, these presents this 9th day of April,
1997.
Signature
Principal Executive Officer
and Director /s/ Charles W. Shivery
Charles W. Shivery
Chairman of the Board, Chief
Executive Officer and Director
Director /s/ Dennis R. Wraase
Dennis R. Wraase
<PAGE>
Exhibit 25
=================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) __
________________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
_______________
Constellation Energy Corporation
(Exact name of obligor as specified in its charter)
Maryland and Virginia 52-1964611
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
David A. Brune, Vice President and Secretary
39 W. Lexington Street
Baltimore, Maryland 21201
(Address of principal executive offices) (Zip code)
______________________
Medium-Term Notes, Series F
(Title of the indenture securities)
=================================================================
<PAGE>
1. General information. Furnish the following information as
to the Trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
- ---------------------------------------------------------------------
Name Address
- ---------------------------------------------------------------------
Superintendent of Banks of the 2 Rector Street, New York,
State of New York N.Y. 10006, and Albany,
N.Y., 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the
Commission, are incorporated herein by reference as an exhibit
hereto, pursuant to Rule 7a - 29 under the Trust Indenture Act of
1939 (the "Act") and Rule 24 of the Commission's Rules of
Practice.
1. A copy of the Organization Certificate of The Bank
of New York (formerly Irving Trust Company) as now in
effect, which contains the authority to commence business
and a grant of powers to exercise corporate trust powers.
(Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and
Exhibit 1 to Form T-1 filed with Registration Statement No.
33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4
to Form T-1 filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section
321(b) of the Act. (Exhibit 6 to Form T-1 filed with
Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the
Trustee published pursuant to law or to the requirements of
its supervising or examining authority.
- 3 -
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of
New York, a corporation organized and existing under the laws of the
State of New York, has duly caused this statement of eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized,
all in The City of New York, and State of New York, on the 2nd day of
April, 1997.
THE BANK OF NEW YORK
By: /s/ MARY LAGUMINA
Name: MARY LAGUMINA
Title: ASSISTANT VICE PRESIDENT
<PAGE>
Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business
September 30, 1996, published in accordance with a call made by
the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin .................. $ 4,404,522
Interest-bearing balances .......... 732,833
Securities:
Held-to-maturity securities ........ 789,964
Available-for-sale securities ...... 2,005,509
Federal funds sold in domestic offices
of the bank:
Federal funds sold ................... 3,364,838
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................28,728,602
LESS: Allowance for loan and
lease losses ..............584,525
LESS: Allocated transfer risk
reserve........................429
Loans and leases, net of unearned
income, allowance, and reserve 28,143,648
Assets held in trading accounts ...... 1,004,242
Premises and fixed assets (including
capitalized leases) ................ 605,668
Other real estate owned .............. 41,238
Investments in unconsolidated
subsidiaries and associated
companies .......................... 205,031
Customers' liability to this bank on
acceptances outstanding ............ 949,154
Intangible assets .................... 490,524
Other assets ......................... 1,305,839
-----------
Total assets ......................... $44,043,010
===========
LIABILITIES
Deposits:
In domestic offices ................ $20,441,318
Noninterest-bearing .......8,158,472
Interest-bearing .........12,282,846
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ... 11,710,903
Noninterest-bearing ..........46,182
Interest-bearing .........11,664,721
Federal funds purchased in
domestic offices of the
bank:
Federal funds purchased ............ 1,565,288
Demand notes issued to the U.S.
Treasury ........................... 293,186
Trading liabilities .................. 826,856
Other borrowed money:
With original maturity of one year
or less .......................... 2,103,443
With original maturity of more than
one year ......................... 20,766
Bank's liability on acceptances exe-
cuted and outstanding .............. 951,116
Subordinated notes and debentures .... 1,020,400
Other liabilities .................... 1,522,884
----------
Total liabilities .................... 40,456,160
==========
EQUITY CAPITAL
Common stock ........................ 942,284
Surplus ............................. 525,666
Undivided profits and capital
reserves .......................... 2,129,376
Net unrealized holding gains
(losses) on available-for-sale
securities ........................ ( 2,073)
Cumulative foreign currency transla-
tion adjustments .................. ( 8,403)
Total equity capital ................ 3,586,850
----------
Total liabilities and equity
capital ........................... $44,043,010
===========
I, Robert E. Keilman, Senior Vice President and Comptroller of
the above-named bank do hereby declare that this Report of
Condition has been prepared in conformance with the instructions is
sued by the Board of Governors of the Federal Reserve System and is
true to the best of my knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this
Report of Condition and declare that it has been examined by us and
to the best of our knowledge and belief has been prepared in
conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true and correct.
J. Carter Bacot >
Thomas A. Renyi > Directors
Alan R. Griffith >
