Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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CONSTELLATION ENERGY GROUP, INC.
(Exact Name of Registrant as Specified in its Charter)
Maryland
(State of Incorporation)
52-1964611
(I.R.S. Employer Identification No.)
David A. Brune, Vice President
250 W. Pratt Street, Baltimore, Maryland 21201
(410) 783-3601
(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. [ ]
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CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
Proposed
Title of each Proposed maximum
class of maximum aggregate
securities to Amount to offering offering Amount of
be registered be registered price per unit price registration fee*
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Medium-Term Notes, $500,000,000 100%* $500,000,000 $132,000
Series B
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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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[COMPANY LOGO]
$500,000,000 Constellation Energy Group, Inc.
Medium Term Notes 250 W. Pratt Street
Series B Baltimore, Maryland 21201
(410) 234-5000
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P R O S P E C T U S
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This prospectus is part of a registration statement that we filed with the SEC
utilizing a "shelf" registration process. Under this shelf process, we may, from
time to time, sell the notes described in this prospectus in one or more
offerings up to a total dollar amount of $500,000,000. We will receive between
$496,250,000 and $499,375,000 of the proceeds from the sale of the notes, after
paying the agents' commissions of between $625,000 and $3,750,000.
This prospectus provides you with a general description of the notes we may
offer. Each time we sell notes, we will provide a pricing supplement (which may
also be referred to as a prospectus supplement) that will contain specific
information about the terms of that offering. The supplement may also add,
update or change information contained in this prospectus.
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We urge you to carefully read this prospectus and the pricing supplement which
will describe the specific terms of the offering together with additional
information described under the heading WHERE YOU CAN FIND MORE INFORMATION
before you make your investment decision
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
LEHMAN BROTHERS
GOLDMAN, SACHS & CO. MERRILL LYNCH & CO.
Agents
(Once the registration statement is effective, the date of the
prospectus will be inserted here.)
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Table of Contents
Page
FORWARD LOOKING STATEMENTS.............................................. 3
CONSTELLATION ENERGY.................................................... 4
CURRENT EVENTS.......................................................... 4
PRICING SUPPLEMENT...................................................... 5
USE OF PROCEEDS......................................................... 6
RATIO OF EARNINGS TO FIXED CHARGES...................................... 7
DESCRIPTION OF THE NOTES................................................ 8
PLAN OF DISTRIBUTION.................................................... 19
LEGAL OPINIONS.......................................................... 21
EXPERTS................................................................. 21
WHERE YOU CAN FIND MORE INFORMATION..................................... 21
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FORWARD-LOOKING STATEMENTS
We make statements in this prospectus and the documents we incorporate by
reference that are considered forward-looking statements within the meaning of
the Securities Act of 1933 and the Securities Exchange Act of 1934. Sometimes
these statements will contain words such as "believes," "expects," "intends,"
"plans" and other similar words. These statements are not guarantees of our
future performance and are subject to risks, uncertainties and other important
factors that could cause our actual performance or achievements to be materially
different from those we project. These risks, uncertainties and factors include,
but are not limited to:
o general economic, business and regulatory conditions;
o energy supply and demand;
o competition;
o federal and state regulations;
o availability, terms and use of capital;
o nuclear and environmental issues;
o weather;
o implications of the restructuring order by the Maryland Public Service
Commission;
o commodity price risk;
o operating our currently regulated generation assets in a deregulated
market beginning July 1, 2000 without the benefit of a fuel rate
adjustment clause;
o loss of revenues due to customers choosing alternative suppliers;
o higher volatility of earnings and cash flows;
o increased financial requirements of our non-regulated subsidiaries;
o inability to pass on to electric retail customers costs associated with
providing them service during the electric rate freeze period; and
o implications from the transfer of Baltimore Gas and Electric Company's
generation assets to nonregulated subsidiaries of Constellation Energy.
Given these uncertainties, you should not place undue reliance on these
forward-looking statements. Please see the documents we incorporate by reference
for more information on these factors. These forward-looking statements
represent our estimates and assumptions only as of the date of this prospectus.
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CONSTELLATION ENERGY
Constellation Energy became the holding company for Baltimore Gas and Electric
Company ("BGE") on April 30, 1999. Constellation Energy owns all the outstanding
shares of common stock of BGE and the subsidiaries formerly owned by BGE.
BGE is a public utility that has served Central Maryland for over 180 years. BGE
produces, purchases and sells electricity and purchases, transports and sells
natural gas. BGE also jointly owns and operates two electric generating plants
and one hydroelectric plant in Pennsylvania.
Constellation Energy owns the stock of several other companies primarily engaged
in diversified energy-services businesses. They are:
o Constellation Power Source, Inc. - wholesale power marketing;
o Constellation Power, Inc. and Subsidiaries - power projects;
o Constellation Energy Source, Inc.- energy products and services;
o Constellation Nuclear Group, LLC - nuclear generation and consulting
services;
o BGE Home Products & Services, Inc. and Subsidiaries - home products,
commercial building systems, and residential and small commercial gas
retail marketing; and
o District Chilled Water General Partnership (ComfortLink) - a general
partnership, in which BGE is a partner, that provides cooling services
for commercial customers in Baltimore;
Constellation Energy also has two other subsidiaries:
o Constellation Investments, Inc. - financial investments and;
o Constellation Real Estate Group, Inc. - real estate and senior living.
CURRENT EVENTS
Electric Restructuring
On April 8, 1999, Maryland enacted legislation authorizing customer choice and
competition among electric suppliers. In addition, on November 10, 1999, the
Maryland Public Service Commission issued a restructuring order that resolved
the major issues surrounding electric restructuring. These matters are discussed
further in our 1999 Annual Report on Form 10-K. See Where You Can Find More
Information.
As a result of the deregulation of the electric generation owned by BGE , no
earlier than July 1, 2000, and upon receipt of all regulatory approvals, we
expect that BGE will transfer, at book value, its 1) nuclear generating assets,
2) nuclear decommissioning trust fund, 3) fossil generating assets and 4)
partial ownership interest in two coal plants and a hydroelectric plant located
in Pennsylvania, to our nonregulated subsidiaries. In total, these generating
assets represent about 6,240 megawatts of generation capacity with a total
projected net book value at June 30, 2000 of approximately $2.4 billion.
We expect BGE to transfer approximately $278 million of tax exempt debt to our
nonregulated subsidiaries related to the transferred assets and that BGE will
receive approximately $ 426 million in unsecured promissory notes. Repayments of
the notes by our nonregulated subsidiaries will be used exclusively to service
certain long-term debt of BGE. BGE will also transfer equity associated with the
generating assets to our nonregulated subsidiaries.
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The fossil fuel and nuclear fuel inventories, materials and supplies, and
certain purchase power contracts of BGE will also be assumed by these entities.
Under the Restructuring Order, BGE will provide standard offer service to
customers at fixed rates over various time periods during the transition period
for those customers that do not choose an alternate supplier once customer
choice begins July 1, 2000. In addition, the electric fuel rate will be
discontinued effective July 1, 2000. Our nonregulated subsidiaries will provide
BGE with the energy and capacity required to meet its standard offer service
obligations for the first three years of the transition period. Standard offer
service will be competitively bid thereafter.
Our nonregulated subsidiaries will obtain the energy and capacity to supply
BGE's standard offer service obligations from our Calvert Cliffs Nuclear Power
Plant (Calvert Cliffs) and BGE's former fossil plants, supplemented with energy
purchased from the wholesale energy market as necessary. Our earnings will be
exposed to the risks of the competitive wholesale electricity market to the
extent that our nonregulated subsidiaries have to purchase energy and/or
capacity or generate energy to meet obligations to supply power to BGE at market
prices or costs, respectively, which may approach or exceed BGE's standard offer
service rates. We will also be affected by operational risk, that is, the risk
that a generating plant is not available to produce energy when the energy is
required.
Until July 1, 2000, we will continue to recover our cost of electric fuel as
long as the Maryland PSC finds that, among other things, we have kept the
productive capacity of our generating plants at a reasonable level. After July
1, 2000, any energy purchased to meet BGE's load commitments will become a cost
of doing business in the newly competitive marketplace. Therefore, if BGE
provides standard offer service at fixed rates to its customers that do not
select an alternative provider as required under the terms of the Restructuring
Order, and the load demand exceeds our capacity to supply energy due to a plant
outage, we would be required to purchase additional power in the wholesale
energy market. If the price of obtaining energy in the wholesale market exceeds
the fixed standard offer service price, our earnings would be adversely
affected. Imbalances in demand and supply can occur not only because of plant
outages, but also because of transmission constraints or due to extreme
temperatures (hot or cold) causing demand to exceed available supply.
We cannot estimate the impact of the increased financial risks associated with
this transition. However, these financial risks could have a material impact on
our, and BGE's, financial results.
Corporate Reorganization
In anticipation of the deregulation of Maryland's electric industry on July 1,
2000, we are realigning our organization. We are combining the existing power
marketing and trading functions of Constellation Power Source with the domestic
plant operations, development and generation functions of Constellation Power
and, on or about July 1, 2000, the electric generation portion of BGE's
business. Together these functions will form an integrated domestic merchant
energy organization that will strategically develop, own and operate power
plants, market and trade power, and manage risk in the wholesale energy market.
PRICING SUPPLEMENT
The pricing supplement, which may also be called a prospectus supplement, for
each offering of notes will contain the specific information and terms for that
offering. The pricing supplement may
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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
Based on our current plans and estimates the net proceeds from the sale of the
notes will be used for general corporate purposes relating to our
nonregulated businesses, including repayment of commercial paper borrowings used
to finance capital expenditures and operations. We may, however, use the net
proceeds for other purposes if we find it necessary. 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. See Where You Can Find More
Information.
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RATIO OF EARNINGS TO FIXED CHARGES
The Ratio of Earnings to Fixed Charges for each of the periods indicated is as
follows:
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Twelve Months Ended December 31,
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1999 1998 1997 1996 1995
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2.87 2.60 2.35 2.44 2.52
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For current information on the Ratio of Earnings to Fixed Charges, please see
our most recent Form 10-K and 10-Q. 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 as of March 24, 1999. This prospectus briefly outlines some
of the indenture provisions. The indenture is a contract between us and The Bank
of New York acting as trustee. The trustee has two main roles. First, the
trustee can enforce your rights against us if an "Event of Default" described
below occurs. Second, the trustee performs certain administrative duties for us.
The indenture is summarized below. Because it is a summary, it does not contain
all of the information that may be important to you. We have filed the indenture
and its supplements with the SEC, and we suggest that you read those parts of
the indenture that are important to you. You especially need to read the
indenture to get a complete understanding of your rights and our obligations
under the provisions described in Event of Default; Consolidation, Merger or
Sale; and Modification of Indenture. See Where You Can Find More Information to
find out how to locate the indenture and the supplements. You may also review
the indenture at the trustee's offices at 101 Barclay Street, New York, New
York.
The specific terms of each offering of notes will be described in the particular
pricing supplement relating to that offering. The pricing supplement may or may
not modify the general terms found in this prospectus and will be filed with the
SEC. For a complete description of the terms of a particular offering of notes,
you should read both this prospectus and the pricing supplement relating to that
particular offering.
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. 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. 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.
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.
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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 later
in this section, Description of the Notes.
Remarketed Notes
We may issue notes with remarketing features that allow holders the option to
sell their notes back to us. In turn, we have the option to retire these notes
or remarket and sell them to new holders.
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 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
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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:
o 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
o 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.
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, The Bank of New York, 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 days prior to the repayment date by
providing the bank:
o the note, with the section entitled "Option to Elect Repayment" on the
reverse of the note completed; or
o 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:
the name of the holder;
the principal amount of the note and the amount to be repurchased;
the certificate number or the maturity and a description of the terms
of the note;
a statement that you wish to sell all or a portion of your note; and
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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 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
The interest rate on the notes will either be fixed or floating. The interest
paid will include interest accrued to, but 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.
"Business Day" means any day other than a Saturday or Sunday that (a) is not a
day on which banking institutions in the state of Maryland, or in New York, New
York, are authorized or obligated by law or executive order to be closed, and
(b) with respect to floating rate notes with a LIBOR interest rate formula only,
is a day on which dealings in deposits in U.S. dollars are transacted in the
London interbank market.
Floating Rate Notes
General
Each floating rate note will have an interest rate formula. The formula may be
based on:
o the commercial paper rate;
o the prime rate;
o the CD rate;
o the federal funds effective rate;
o the LIBOR;
o the Treasury rate;
o the CMT rate; or
o another interest rate index.
The interest rate for each interest period will be based on the formula plus a
spread or multiplied by a spread multiplier, if any, as indicated in the
applicable pricing supplement. In addition, any floating rate note may have a
maximum or minimum interest rate limitation.
Date of Interest Rate Change
The interest rate on each floating rate note may be reset daily, weekly,
monthly, quarterly, semi-annually, or annually based
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on the Index Maturity for the interest rate formula as specified in the
applicable pricing supplement. "Index Maturity" means the period to maturity
on the referenced floating interest rate contract on which the interest rate
formula is based. The specific dates on which the interest rate will reset
(Interest Reset Date) will be specified in the applicable pricing supplement
and will be:
o for notes which reset daily, each Business Day;
o for notes (other than Treasury rate notes) which reset weekly, the
Wednesday of each week;
o for Treasury rate notes which reset weekly, the Tuesday of each
week;
o for notes which reset monthly, the third Wednesday of each month;
o for notes which reset quarterly, the third Wednesday of March, June,
September and December;
o for notes which reset semi-annually, the third Wednesday of the two
months of each year indicated in the applicable pricing supplement; and
o for notes which reset annually, the third Wednesday of the month of each
year indicated in the applicable pricing supplement.
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 rate for all notes (except Treasury rate notes) will be the rate
determined on the second Business Day before the Interest Reset Date (Interest
Determination 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.
The Bank of New York or its successor, the Calculation Agent, will calculate the
interest rate on the tenth day or if not a business day, the next business day,
after the related Interest Determination Date (Calculation Date) for all
floating rate notes except LIBOR notes. For LIBOR notes the Calculation Date
will be the Interest Determination Date.
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.
When Interest Is Paid
Interest is paid as follows:
o for notes which reset daily or weekly, on the third Wednesday of March, June,
September and December;
o 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);
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o for notes which reset quarterly, on the third Wednesday of March, June,
September, and December;
o for notes which reset semi-annually, on the third Wednesday of the two months
specified in the applicable pricing supplement;
o for notes which reset annually, on the third Wednesday of the month specified
in the applicable pricing supplement; and
o 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
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." "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.
The "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:
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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 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."
"Composite Quotation" 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.
(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,
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 or replacement 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
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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
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
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<PAGE>
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 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
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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 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
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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
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:
o failure to pay the principal of (or premium, if any, on) any note of a
series when due and payable;
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o failure to pay for 30 days any interest on any note of any series;
o failure to perform any other requirements in the notes, or in the
indenture in regard to such notes, for 60 days after notice; or
o 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 holders
unless such holders offer the Trustee reasonable indemnity. Subject to the
provisions for indemnification and certain other limitations, 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:
o 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
o 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
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appointment under the terms of an agency agreement between the agents
and us.
For each note and in total, we have set out below the offering price, the
compensation we will pay the agents and the proceeds we will receive, before
deducting expenses of approximately $365,000, depending on the maturity of the
notes they sell.
Per Note
Public Offering Price 100%
Agents' Commissions 0.125% - 0.75%
--------------
Proceeds to Constellation Energy
(before expenses) 99.875% - 99.25%
Total
Public Offering Price $500,000,000
Agents' Commissions $625,000 - $3,750,000
---------------------
Proceeds to Constellation Energy
(before expenses) $499,375,000 - $496,250,000
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.
General Information
In connection with sales by an agent or an underwritten offering, the SEC rules
permit the underwriters or agents to engage in transactions that stabilize the
price of the notes. These transactions may include purchases for the purpose of
fixing or maintaining the price of the notes.
The underwriters or agents may create a short position in the notes in
connection with the offering. That means they sell a larger principal amount of
the notes than is shown on the cover page of the prospectus or the applicable
pricing supplement. If they create a short position, the underwriters or agents
may purchase notes in the open market to reduce the short position.
If the underwriters or agents purchase the notes to stabilize the price or to
reduce their short position, the price of the notes could be higher than it
might be if they had not made such purchases. The underwriters or agents make no
representation or prediction about any effect that the purchases may have on the
price of the notes. These transactions may be affected on the open market and
may be discontinued at any time.
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.
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One of our subsidiaries, Constellation Power Source, has an exclusive
arrangement with a subsidiary of Goldman, Sachs & Co. to serve as an advisor for
power marketing and related risk management services. In addition, our
subsidiary, Constellation Enterprises, Inc., has an ownership interest in Orion
Power Holdings, Inc. with an affiliate of Goldman, Sachs & Co. to acquire
electric generating plants in the United States and Canada. An underwriter may
engage in transactions with, or perform services for, us or our subsidiaries in
the ordinary course of its businesses.
LEGAL OPINIONS
One of our lawyers will issue an opinion regarding certain legal matters in
connection with the notes offered pursuant to this prospectus. Cahill Gordon &
Reindel, New York, NY will issue an opinion for any underwriters, dealers or
agents. 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.
EXPERTS
The financial statements and financial statement schedule incorporated in this
Prospectus by reference to the Annual Report on Form 10-K of Constellation
Energy Group, Inc. for the year ended December 31, 1999 have been so
incorporated in reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting
WHERE YOU CAN FIND MORE INFORMATION
Constellation Energy will file annual, quarterly and special reports, proxy
statements and other information with the SEC. Prior to Constellation Energy
becoming BGE's holding company, reports, statements and other information were
filed by BGE under the name "Baltimore Gas and Electric Company." You may read
and copy any document filed by BGE or Constellation Energy at the SEC's public
reference room at 450 Fifth Street, N.W., Washington, D.C., 20549. Please call
the SEC at 1-800-SEC-0330 for further information on the public reference room.
The SEC maintains an internet site at http://www.sec.gov that contains reports,
proxy and information statements, and other information, regarding issuers
(including Constellation Energy and BGE) that file documents with the SEC
electronically. Constellation Energy's SEC filings may also be obtained from our
web site at http://www.constellationenergy.com.
This prospectus is part of a registration statement we filed with the SEC. In
addition, 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.
o Annual Report on Form 10-K for the year ended December 31, 1999.
o Current Reports on Form 8-K filed with the SEC on February 15, 2000
and March 17, 2000.
This prospectus is part of a registration statement we filed with the SEC.
Any person, including any beneficial owner, may request a copy of these filings,
at no cost, by writing or telephoning us at the following address:
Shareholder Services
Constellation Energy Group, Inc.
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39 W. Lexington Street
Baltimore, Maryland 21201
410-783-5920
You should rely only on the information incorporated by reference or provided in
this prospectus or any supplement. We have not authorized anyone else to provide
you with different information. We are not making an offer of these notes in any
state where the offer is not permitted. You should not assume that the
information in this prospectus or any supplement is accurate as of any date
other than the date on the front of those documents.
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================================================================================
[COMPANY LOGO]
$500,000,000
Medium-Term Notes
Series B
- --------------------------------------------------------------------------------
PROSPECTUS
(Once the registration statement is effective, the date of the Prospectus will
be inserted here)
- --------------------------------------------------------------------------------
LEHMAN BROTHERS
GOLDMAN, SACHS & CO. MERRILL LYNCH & CO.
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Securities and Exchange Commission Registration Fee............... $132,000
Services of Independent Accountants............................... 50,000*
Trustee Fees and Expenses......................................... 10,000*
Legal Fees and Expenses........................................... 35,000*
Debt Securities Rating Fees....................................... 100,000*
Printing and Delivery Expenses.................................... 15,000*
Miscellaneous Expenses............................................ 18,000*
-------
Total.............................................................$360,000*
==========
--------------
* Estimated
Item 15. Indemnification of Directors and Officers.
The following description of indemnification allowed under Maryland
statutory law is a summary rather than a complete description. Reference is made
to Section 2-418 of the Corporations and Associations Article of the Maryland
Annotated Code, which is incorporated herein by reference, and the following
summary is qualified in its entirety by such reference.
By a Maryland statute, 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"). Such indemnification may be against
judgments, penalties, fines, settlements and reasonable expenses actually
incurred by him in connection with the Proceeding unless it is proven that (a)
the act or omission of the Director was material to the matter giving rise to
the Proceeding and (i) was committed in bad faith, or (ii) was the result of
active and deliberate dishonesty; or (b) the Director actually received an
improper personal benefit in money, property, or services; or (c) in the case of
any criminal proceeding, the Director had reasonable cause to believe his act or
omission was unlawful. However, the 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 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
II-1
<PAGE>
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 by statute is
not 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.
A corporation may purchase and maintain insurance on behalf of any
person who is or was a Director or officer, whether or not the corporation would
have the power to indemnify a Director or officer against liability under the
provision of this section of Maryland law. Further, a corporation may provide
similar protection, including a trust fund, letter of credit or surety bond, not
inconsistent with the statute.
Article Eighth of the Company's Charter reads as follows:
"(a)
(i) The Corporation shall indemnify
(A) Its Directors and Officers, whether serving the
Corporation or at its request any other entity, to the full extent required or
permitted by the general laws of the State of Maryland, now or hereafter in
force, including the advance of expenses, under the procedures and to the full
extent permitted by law, and
(B) other employees and agents, to such extent as shall be
authorized by the Board of Directors or the Corporation's by-laws and be
permitted by law.
(ii) The foregoing rights of indemnification shall not be exclusive of
any other rights to which those seeking indemnification may be entitled.
(iii) The Board of Directors may take such action as is necessary to carry
out these indemnification provisions and is expressly empowered to adopt,
approve and amend from time to time such by-laws, resolutions or contracts
implementing such provisions or such further indemnification arrangements as may
be permitted by law. No amendment of the Charter of the Corporation
II-2
<PAGE>
or repeal of
any of its provisions shall limit or eliminate the right to indemnification
provided hereunder with respect to any act or omission occurring prior to such
amendment or repeal.
(b) To the fullest extent permitted by Maryland statutory or
decisional law, as amended or interpreted, no Director or Officer of this
Corporation shall be personally liable to the Corporation or its stockholders
for money damages. No amendment of the Charter of the Corporation or repeal of
any of its provisions shall limit or eliminate the limitation on liability
provided to Directors and Officers hereunder with respect to any act or omission
occurring prior to such amendment or repeal."
Article V of the Company's By-Laws reads as follows:
"The Corporation shall indemnify all Directors, Officers and employees
to the fullest extent permitted by the general laws of the State of
Maryland and shall provide indemnification expenses in advance to the
extent permitted thereby. The Corporation will follow the procedures
required by applicable law in determining persons eligible for
indemnification and in making indemnification payments and advances.
The Indemnification and advance of expenses provided by the Charter and
these by-laws shall not be deemed exclusive of any other rights to
which a person seeking indemnification or advance of expenses may be
entitled under any law (common or statutory), or any agreement, vote of
stockholders or disinterested Directors or other provision that is
consistent with law, both as to action in his or her official capacity
and as to action in another capacity while holding office or while
employed by or acting as agent for the Corporation, shall continue in
respect of all events occurring while a person was a Director or
Officer after such person has ceased to be a Director or Officer, and
shall inure to the benefit of the estate, heirs, executors and
administrators of such person. All rights to indemnification and
advance of expenses under the Charter of the Corporation and hereunder
shall be deemed to be a contract between the Corporation and each
Director or Officer of the Corporation who serves or served in such
capacity at any time while this by-law is in effect. Nothing herein
shall prevent the amendment of this by-law, provided that no such
amendment shall diminish the rights of any person hereunder with
respect to events occurring or claims made before its adoption or as to
claims made after its adoption in respect of events occurring before
its adoption. Any repeal or modification of this by-law shall not in
any way diminish any rights to indemnification or advance of expenses
of such Director or Officer or the obligations of the Corporation
arising hereunder with respect to events occurring, or claims made,
while this by-law or any provision hereof is in force."
II-3
<PAGE>
The Directors and officers of the Company are covered by insurance
indemnifying them against certain liabilities which might be incurred by them in
their capacities as such, including certain liabilities arising under the
Securities Act of 1933. The premium for this insurance is paid by the Company.
Also, see indemnification provisions in the Form of Agency Agreement
and the Standard Purchase Provisions, both included in Exhibit 1(a) to this
Registration Statement.
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;
(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
II-4
<PAGE>
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.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
Constellation Energy Group, Inc., 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 5th day of May, 2000.
CONSTELLATION ENERGY GROUP, INC.
(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:
*C. H. Poindexter Chairman of the May 5, 2000
Board and Chief
Executive Officer
Principal financial and accounting officer:
/s/ David A. Brune Vice President May 5, 2000
- -------------------- and Secretary
David A. Brune
*H. Furlong Baldwin
*James T. Brady
*Beverly B. Byron
*J. Owen Cole
*Dan A. Colussy
*Edward A. Crooke
*James R. Curtiss
*Roger W. Gale Directors May 5, 2000
*Jerome W. Geckle
*Freeman A. Hrabowski, III
*Nancy Lampton
*Charles R. Larson
*George L. Russell, Jr.
*Mayo A. Shattuck, III
*Michael D. Sullivan
* 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 March 24, 1999 between the Company and
The Bank of New York. (Designated as Exhibit 4(a) to Form S-3
Registration Statement File No. 333-75217 filed March 29, 1999).
4(b) - Form of Medium-Term Note, Series B (Fixed Rate).
4(c) - Form of Medium-Term Note, Series B (Floating Rate).
5 - Opinion of Company Counsel.
12* - Computation of Ratio of Earnings to Fixed Charges (Designated as
Exhibit 12(a) in Form 10-K for the year ended December 31, 1999, filed
March 20, 2000, File No. 1-12869).
23(a) - Consent of Company Counsel(included in Exhibit 5).
23(b) - Consent of PricewaterhouseCoopers LLP, Independent Accountants.
24 - Power of Attorney.
25 - Statement of Eligibility under the Trust Indenture Act of 1939
(Form T-1) of The Bank of New York, Trustee.
- ------------------
* Incorporated by reference.
Exhibit 1(a)
$500,000,000
CONSTELLATION ENERGY GROUP, INC.
MEDIUM-TERM NOTES
SERIES B
FORM OF AGENCY AGREEMENT
________, 2000
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, Pierce, Fenner & Smith
Incorporated
World Financial Center, North Tower
New York, NY 10281-1305
Dear Sirs:
1. Introduction. Constellation Energy Group, Inc., a Maryland corporation
(the "Company"), confirms its agreement with Lehman Brothers Inc., Goldman,
Sachs & Co. and 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 Company of up to $500,000,000 aggregate
principal amount of its Medium-Term Notes, Series B registered under the
registration statement referred to in Section 2(a) (the "Notes"). The Notes will
be issued under an indenture, dated as of March 24, 1999 (the "Indenture"),
between the Company 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 Company in accordance with the Indenture,
the Notes and the Procedures (as defined in Section 3(d) hereof).
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, each Agent as follows:
<PAGE>
-2-
(a) A registration statement on Form S-3 (No. 333-) covering $500
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 _______ 2000 (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 Company 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 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
<PAGE>
-3-
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 Company
hereby appoints each of the Agents as an agent of the Company for the purpose of
soliciting or receiving offers to purchase the Notes from the Company 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 Company, to use all reasonable efforts when requested by
the Company 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 Company as contemplated by Section
4(b) hereof, each Agent shall suspend its solicitation of purchases of Notes
until such time as the Company 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 Company 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 Company, the
Agents will use their best efforts promptly to suspend solicitation of offers to
purchase Notes from the Company, but in no event later than one business day
after notice, until such time as the Company 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 State of Maryland
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 Company,
orally or in writing, each reasonable offer to purchase Notes received by it as
Agent. The Company 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 have
the right, in its discretion reasonably exercised, without notice to the
Company, 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.
<PAGE>
-4-
No Note which the Company has agreed to sell pursuant to this
Agreement shall be deemed to have been purchased and paid for, or sold, by the
Company 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 Company as a result of a solicitation made by, or offer to purchase received
by, an Agent, the Company 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
Company. The initial Procedures, which are set forth in Exhibit B hereto, shall
remain in effect until changed by agreement among the Company and the Agents.
Each Agent and the Company agree to perform the respective duties and
obligations specifically provided to be performed by each of them herein and in
the Procedures. The Company 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 May 3, 1999 (the "Interest Calculation Agency Agreement").
(e) The documents required to be delivered by Section 5 hereof
shall be delivered at the offices of the Company,250 W. Pratt Street, 20th
Floor, 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 Company 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 Company. The Company 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:
(a) From the time solicitation regarding sale of the Notes is begun until all of
the Notes have been sold (i) the Company 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 amendment, 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 Company
will afford the
<PAGE>
-5-
Agents a reasonable opportunity to comment on any such proposed
post-effective amendment, sticker, or supplement; (iii) the Company will advise
each Agent of the filing of any such post-effective amendment, sticker, or
supplement; and (iv) the Company 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 Company 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 Company will promptly notify each Agent to suspend
solicitation of purchases of the Notes. Notwithstanding Section 4(a) if the
Company 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 Company has accepted an offer to purchase Notes
but the related settlement has not occurred, then the Company, 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 Company, 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 Company will
immediately notify each Agent of any downgrading in the rating of the Notes or
any other debt securities of the Company, or any proposal to downgrade the
rating of the Notes or any other debt securities of the Company, by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act), as soon as the Company learns of such downgrading
or proposal to downgrade.
(d) The Company 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
<PAGE>
-6-
available and in such quantities as are reasonably requested.
(e) The Company 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 Company 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 Company to be unduly burdensome.
(f) So long as any Notes are outstanding, the Company 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 Company
filed with the Commission under the Exchange Act or mailed to shareholders, and
(iii) from time to time, such other information concerning the Company as you
may reasonably request.
(g) The Company 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 Company in which the Closing
Date or any other Representation Date occurs, the Company 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.
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 Company 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 Company's officers made
pursuant to the provisions hereof on each such date, to the performance by the
Company of its obligations hereunder on or prior to each such date, and to each
of the following additional conditions precedent:
<PAGE>
-7-
(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 Company 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 Company 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 a counsel for the Company, to the effect
that:
(i) The Company, Baltimore Gas and Electric Company (BGE)
and Constellation Enterprises, Inc. (CEI) have been duly
incorporated and are validly existing as corporations in good
standing under the laws of the State of Maryland, with power and
authority (corporate and other) to own their respective properties
and conduct their respective businesses as described in the
Prospectus; the Company owns all of the outstanding shares of
common stock of BGE and CEI; and the Company is duly qualified to
do business as a foreign corporation in good standing in all
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 Company, and is a valid instrument, legally
binding on the Company, 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;
<PAGE>
-8-
(iii) The issuance and sale of Notes have been duly
authorized by all necessary corporate action of the Company. 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 Company 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 Closing Date) 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 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) Counsel knows of no approval of any regulatory
authority which is legally required for the valid offering,
issuance, sale and delivery of the Notes by the
<PAGE>
-9-
Company 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 Company 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
Company's Charter or By-Laws or any indenture, mortgage or deed of
trust or other agreement or instrument to which the Company is a
party;
(vii) Each of this Agreement and the Interest Calculation
Agency Agreement has been duly authorized, executed and delivered
by the Company;
(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 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, President or
any Vice President and a principal financial or accounting officer of the
Company 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
Company in this Agreement are true and correct in all material respects, (ii)
the Company 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 Company,
except as set forth or contemplated in the Prospectus.
(f) At the Closing Date, the Agents shall have received a letter,
dated the Closing Date, of PricewaterhouseCoopers LLP,
<PAGE>
-10-
confirming that they are independent pubic accountants within the meaning
of the Act and the 33 Act Rules and Regulations, and stating in effect 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 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
<PAGE>
-11-
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 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
Company 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 Company, and all other matters governed by the laws of
the State of Maryland, and the applicability of the 1935 Act for the issuance,
sale and delivery of the Notes upon the opinion of Counsel for the Company
referred to above.
In addition, such counsel shall state that such counsel has
participated in conferences with officers, counsel and other representatives of
the Company, representatives of the independent certified public accountants for
the Company and representatives of the Agents at which the contents of the
<PAGE>
-12-
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 Company), 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 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).
The Company 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 Company. The Company agrees that:
-----------------------------------
(a) Each acceptance by the Company 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 Company of an offer
for the purchase of Notes shall be deemed to constitute an additional
representation, warranty and agreement by the Company 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 Company
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 Company (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
<PAGE>
-13-
8-K under the Exchange Act (the date of filing each of the aforementioned
documents is referred to as a "Representation Date"); the Company shall furnish
the Agents (but in the case of (iv) above only if requested by the Agents) with
a certificate of the Chairman, President or any Vice President and a principal
financial or accounting officer of the Company, 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 Company in this Agreement are true and correct in all material respects;
(ii) the Company 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 Company, 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 Company
shall concurrently furnish the Agents with a written opinion or opinions of
counsel for the Company, 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 Company shall cause PricewaterhouseCoopers LLP or
successor thereto concurrently to furnish the Agents with a letter, addressed
jointly to the Company and the
<PAGE>
-14-
Agents and dated the Representation Date or the date of such 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 Company; 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, PricewaterhouseCoopers LLP may limit the scope of such letter 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 letter, in which event such letter 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 Company
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 a counsel for the Company, dated the date of delivery
thereof, in form satisfactory to such Agent, to the effect set forth in clauses
(i), (ii), and (iii) 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 Company 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 Company 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 Company 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 Company'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), and (c), 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 as amended or
supplemented to the trade date as specified pursuant to the Administrative
Procedures, in or affecting particularly the business or properties of the
Company which materially impairs the investment quality of the Notes; and (iv)
no downgrading in the rating of the Company's debt
<PAGE>
-15-
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 Company will indemnify and hold harmless each Agent and
each person if any, who controls either 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 Company 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 Company 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 Company in writing that such
information should no longer be used therein. This indemnity agreement will be
in addition to any liability which the Company may otherwise have.
(b) Each Agent will indemnify and hold harmless the Company, each
of its directors, each of its officers who have signed the Registration
Statement and each person, if any, who controls the Company within the meaning
of the Act or the Exchange Act, against any losses, claims, damages or
liabilities to which the Company 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
<PAGE>
-16-
reliance upon and in conformity with written information furnished to the
Company by such Agent specifically for use therein; and will reimburse any legal
or other expenses reasonably incurred by the Company 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 Company 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 Company 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 any statement or omission, and any other
equitable considerations appropriate under the circumstances. The Company and
the Agents
<PAGE>
-17-
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 Company, 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 Company 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
Company and not as principal. Each Agent will use all reasonable efforts to
assist the Company in obtaining performance by each purchaser whose offer to
purchase Notes from the Company has been solicited by such Agent and accepted by
the Company, but such Agent shall have no liability to the Company in the event
any such purchase is not consummated for any reason. If the Company shall
default on its obligations to deliver Notes to a purchaser whose offer it has
accepted, the Company (i) shall hold the Agents harmless against any loss, claim
or damage arising from or as a result of such default by the Company, 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
Company 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
Company 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 Agreement is terminated pursuant to Section 10 or for any other reason, the
Company shall remain responsible for the expenses to be paid or reimbursed by it
pursuant to Section 4(g) and the obligations of the Company under Sections 4(f)
and (h) and the
<PAGE>
-18-
respective obligations of the Company 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 Company has accepted an offer to purchase Notes
and prior to the related settlement, the obligations of the Company 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 Company as to any Agent or, in the case of either 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 Company, 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 Company to purchase all or a portion of Notes from the Company 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 Company in substantially the form attached
hereto as Exhibit C.
Without the oral consent (confirmed in writing) of the Company,
neither Agent shall have the right to purchase all or a portion of the Notes for
its own account. In the event the Company 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 Company 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 Company to any person or entity without the
involvement of either of the Agents or from entering into similar agreements
with other firms as agents.
The Company will not appoint another agent without providing each
Agent with at least one business day's notice.
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 delivered by overnight mail or transmitted by any standard form of
telecommunication. Notices to Lehman Brothers Inc. shall be delivered or
telecopied to it at 3 World Financial Center, 12th Floor, New York, New York
10285-1200, telecopier, (212) 528-1718,
<PAGE>
-19-
Attention: Medium-Term Note Department; notices to Goldman, Sachs & Co.
shall be 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, Pierce, Fenner & Smith Incorporated shall be delivered
_______________________________and notices to the Company shall be delivered or
telecopied to it at 250 W. Pratt Street,20th Floor, Baltimore, Maryland
21201-2437, telecopier, (410) 783-3619, Attention: Treasurer, 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 Company, 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.
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 GROUP, INC.
By:
----------------------------------
CONFIRMED AND ACCEPTED, as of the date first above written:
LEHMAN BROTHERS INC.
By:
---------------------------
GOLDMAN, SACHS & CO.
Goldman, Sachs & Co.
<PAGE>
-20-
Merrill Lynch, Pierce, Fenner & Smith Incorporated
By: ____________________________
<PAGE>
Exhibit A
to Agency Agreement
The Company agrees to pay either 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
ADMINISTRATIVE PROCEDURES
The Medium-Term Notes, Series B due from nine months to thirty years from
their issue dates (the "Notes") are to be offered on a continuing basis by
Constellation Energy Group, Inc. (the "Company"). Lehman Brothers Inc. Goldman,
Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated as agents
(individually, an "Agent" and collectively, the "Agents") have each agreed to
use all reasonable efforts to solicit purchases of the Notes. Neither Agent will
be obligated to purchase Notes for its own account and neither may do so without
the written consent of the Company. The Notes are being sold pursuant to an
Agency Agreement, dated as of __________, 2000 (the "Agency Agreement"), among
the Company and the Agents, and will be issued pursuant to an Indenture, between
the Company and The Bank of New York dated as of March 24, 1999 (the
"Indenture"). The Notes will rank equally with all other unsecured and
unsubordinated indebtedness of the Company and will have been registered with
the Securities and Exchange Commission (the "Commission").
The Company has designated The Bank of New York (the "Bank") as
the agency for payment, registration and notice concerning the Notes in
accordance with Section 5.02 of the Indenture and as the Authentication Agent
for the Notes in accordance with Section 2.02 of the Indenture. The Company has
also designated the Bank as the Calculation Agent with respect to the issuance
of floating rate notes pursuant to the Interest Calculation Agency Agreement
between the Company and the Bank dated __________, 2000.
Administrative procedures and specific terms of the offering are
explained below. Internal administrative and record-keeping responsibilities
will be handled for the Company by its Financial Management Unit of the Finance
Department. The Company will advise the Agents in writing of those persons
handling administrative responsibilities with whom the Agents are to communicate
regarding offers to purchase Notes and the details of their delivery. Unless
otherwise designated, the Notes will be issued as Global Securities registered
in the name of The Depository Trust Company or a nominee thereof (referred to as
"Book Entry Notes"). Procedures pertaining specifically to Book-Entry Notes and,
as the case may be, Notes issued in definitive form ("Certificated Notes") will
be explained separately below.
I. GENERAL PROCEDURES
Aggregate
Principal Amount: $500,000,000
- ----------------
Issue Date: Each Note will be dated the date of its
authentication. Each Note will also bear an
original issue date (the "Issue Date") which,
with respect to any Note (or portion thereof),
shall mean the date of its original issuance
and shall be specified therein. The Issue Date
shall remain the same for all Notes
<PAGE>
-B2-
subsequently issued upon transfer, exchange or
substitution of a Note, regardless of their
dates of authentication.
Maturities: Each Note will mature on a Business Day (as defined
below), selected by the purchaser and agreed to by
the Company, which will range from nine months to
thirty years after the Issue Date. Each Note bearing
interest at a rate determined by reference to an
interest rate formula (a "Floating Rate Note") will
mature on an Interest Payment Date (as defined
below).
"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.
Price to Public: Each Note will be issued at 100% of principal
amount (unless otherwise indicated in a pricing
supplement).
Denominations: The minimum denominations of the Notes will be
$1,000 and integral multiples of $1,000 in excess
thereof (see "Special Procedures for Book-Entry
Notes - Denominations" for information relating to
Book-Entry Notes).
Registration: Notes will be issued only in fully registered
form as either a Book-Entry Note or a Certificated
Note. Certificated Notes may be presented for
registration of transfer or exchange at the Bank's
New York office.
Interest Payments: Each Note bearing interest at a fixed rate (a
"Fixed Rate Note") will bear interest from its
Issue Date if interest has not been paid on the
Note or from the most recent Interest Payment Date
to which interest has been paid at the fixed
rate per annum stated on the face thereof, payable
semi-annually on May 1 and November 1 of each
year (each an "Interest Payment Date" with
respect to such Fixed Rate Note), and at Stated
Maturity, and, if applicable, upon redemption or
repurchase.
Special provisions are set forth in the Prospectus
relating to Floating Rate Notes. Interest rates are
determined by reference to the interest rate formula
stated therein and payable in arrears on such dates
as specified therein (each an "Interest Payment
Date" with respect to such Floating Rate Note).
Interest on Fixed Rate Notes (including payments for
partial periods) will be computed and paid on the
basis of a 360-day year of twelve 30-day months and
will not accrue on the 31st day of any month.
Interest will be payable to the person in whose name
the Note is registered at the close of business on
April 15 or October 15, (whether or not such date is
a Business Day) with respect t
<PAGE>
-B3-
Fixed Rate Notes or the fifteenth day (whether or
not a Business Day) with respect to
Floating Rate Notes (the "Record
Dates"), next preceding the respective Interest
Payment Date; provided, however, that interest
payable at Stated Maturity and, if applicable, upon
redemption or repurchase will be payable to the
person to whom principal shall be payable. The first
payment of interest on any Note originally issued
between a Record Date and an Interest Payment Date
will be made on the Interest Payment Date following
the next succeeding Record Date. All interest
payments (excluding interest payments made at Stated
Maturity and, if applicable, upon redemption and
repurchase) will be made by check mailed to the
person entitled thereto as provided above; except
that holders of over $5 million in principal amount
of the Notes may receive interest payments by wire
upon at least three Business Day's written notice to
the Bank.
On the fifth Business Day immediately preceding each
Interest Payment Date, the Bank will furnish the
Company with the total amount of the interest
payments to be made on such Interest Payment Date.
The Bank will provide monthly to the Company's
Financial Services Unit a list of the principal and
interest to be paid on Notes maturing in the next
succeeding month. On the Interest Payment Date
(unless the Interest Payment Date is not a Business
Day, then the immediately succeeding Business Day),
the Company will transfer to the Bank, via the
Federal Reserve wire system, immediately available
funds sufficient to make such interest payments. The
Bank will assume responsibility for withholding
taxes on interest paid as required by law.
Acceptance of Offers: Each Agent will promptly advise the
Company of each reasonable offer to purchase Notes
received by it, other than those rejected by such
Agent. Each Agent may, in its discretion reasonably
exercised, without notice to the Company, reject any
offer received by it, in whole or in part. The
Company will have the sole right to accept offers to
purchase Notes and may reject any such offer, in
whole or in part. If the Company rejects an offer,
the Company will promptly notify the Agent involved.
Settlement: All offers accepted by the Company will be settled
on the third Business Day next succeeding the date
of acceptance unless otherwise agreed by any
purchaser and the Company. The settlement date shall
be specified upon receipt of an offer.
Confirmation: For each accepted offer, the Presenting Agent will
issue a confirmation to the purchaser, with a copy
to the Company's Financial Services Unit and the
Bank, setting forth the Purchase Information and
delivery and payment instructions.
Redemption at
Company's Option: Except as otherwise specified in the applicable
Pricing Supplement and on the Notes, the Notes
will not be redeemable prior to their Stated
Maturity. If so specified, such Note will be
redeemable at the option of the Company on or after
a specified date at a specified price or prices
(which may include a
<PAGE>
-B4-
premium) together with accrued interest thereon payable to, but
excluding, the date fixed for redemption. The Notes will be redeemable
in whole or in part (whether or not any other Notes of the same series
are redeemed), in increments of $1,000 on notice by mail given not
more than 60 nor less than 30 days prior to the date fixed for
redemption. If there is a partial redemption, the Bank will issue a
new Note on the same terms.
Upon presentation of each Note at the date fixed for redemption, the
Bank (or any other duly appointed paying agent) will pay the principal
amount (at a price, expressed as a percent of the principal amount,
specified on the Note and in the applicable Pricing Supplement)
redeemed thereof, together with accrued interest due on the amount
redeemed at the date fixed for redemption. Such payment shall be made
in immediately available funds, provided that the Note is presented to
the Bank (or any such paying agent) in time for the Bank (or any such
paying agent) to make payments in such funds in accordance with its
normal procedures. On the date fixed for redemption (unless the date
fixed for redemption is not a Business Day, then the immediately
succeeding Business Day), the Company will provide the Bank (and any
such paying agent), via the Federal Reserve wire transfer system, with
immediately available funds sufficient for the Bank to make such
payment. Notes presented at the date fixed for redemption will be
canceled by the Bank as provided in the Indenture.
Repurchase at
Holder's Option:
Except as otherwise specified in the applicable Pricing Supplement and
on the Notes, the Company is not required to repurchase the Notes from
the holders prior to the Stated Maturity. If so specified, Notes will
be redeemable at the option of the holder, in whole or in part, in
increments of $1,000, on the dates and at the prices specified
therein, together with accrued interest to, but excluding, the
repurchase date. For Book-Entry Notes, holders must deliver a 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 signatory of the Depositary (signature guaranteed). For
Certificated Notes, holders must complete the "Option to Elect
Repayment" on the reverse of the Note and then deliver the Note to the
Bank at least 30, but no more than 45 days prior to the date of the
repurchase, but no later than 5:00 p.m. New York City time on the last
day for giving notice. All notices are irrevocable. If there is a
partial redemption, the Bank will issue a new Note on the same terms.
On the repurchase date, the Bank (or any other duly appointed paying
agent) will repurchase the Note from the holder at the specified
price, together with any accrued interest, payment to be made in
immediately available funds. The Company will provide the Bank (and
any such paying agent), via the Federal Reserve wire transfer system,
with immediately available funds sufficient for the Bank to make such
repurchases. Repurchased Notes will be canceled by the Bank as
provided in the Indenture.
<PAGE>
-B5-
Remarketed Notes Procedures related to Remarketed Notes will be added
at the time any notes are issued.
Maturity: Upon presentation of each Note at maturity the
Bank (or any other duly appointed paying agent) will
pay the principal amount thereof, together with
accrued interest due at maturity. Such payment shall
be made in immediately available funds, provided
that the Note is presented to the Bank (or any such
paying agent) in time for the Bank (or any such
paying agent) to make payments in such funds in
accordance with its normal procedures. On the
maturity date, the Company will provide the Bank (and
any such paying agent), via the Federal Reserve wire
transfer system, with immediately available funds
sufficient for the Bank to make such payment. Notes
presented at maturity will be canceled by the Bank as
provided in the Indenture.
Procedure for
Rate or Redemption
Changes: The Company and the Agents will discuss from time
to time the rates to be borne by, and the redemption
and repurchase provisions, if any, of, the Notes that
may be sold as a result of the solicitation of offers
by the Agents. Once any Agent has recorded any
indication of interest in Notes upon certain terms,
and communicated with the Company, if the Company
plans to accept an offer to purchase Notes upon such
terms, it will prepare a sticker reflecting the terms
of such Notes and, after confirming such terms with
such Agent, will arrange to have the Prospectus, as
then amended or supplemented, and bearing such sticker,
filed with the Commission and will supply at least 10
copies of the Prospectus, as then amended or
supplemented, and bearing such sticker, to the
Presenting Agent. No settlements with respect to
Notes upon such terms may occur prior to such filing
and the Agents will not, prior to such filing,
mail confirmations to customers who have offered to
purchase Notes upon such terms. After such filing,
sales, mailing of confirmations and settlements
may occur with respect to Notes upon such terms,
subject to the provisions of "Delivery of
Prospectus" below.
If the Company decides to post rates (which may include the presence
or absence of redemption and repurchase provisions) and a decision has
been reached to change interest rates or redemption or repurchase
provisions, if any, the Company will promptly notify each Agent. Each
Agent will forthwith suspend solicitation of purchases. At that time,
the Agents will recommend and the Company will establish rates to be
so "posted." Following establishment of posted rates and prior to the
filing described in the following sentence, the Agents may only record
indications of interest in purchasing Notes at the posted rates. Once
any Agent has recorded any indication of interest in Notes at the
posted rates and communicated with the Company, if the Company plans
to accept an offer at the posted rate, it will prepare a sticker
reflecting such posted rates and, after confirming such terms with
such Agent, will arrange to have the Prospectus, and bearing such
sticker, filed with the Commission and will supply at least 10 copies
of the Prospectus, as then amended or supplemented, to the Presenting
Agent. No settlements at the posted rates may occur prior to such
filing and the Agents will not, prior to such filing, mail
confirmations to
<PAGE>
- -B6-
customers who have offered to purchase Notes at the posted rates.
After such filing, sales, mailing of confirmations and settlements may
resume, subject to the provisions of "Delivery of Prospectus" below.
Outdated stickers, and copies of the Prospectus to which they are
attached (other than those retained for files), will be destroyed.
Suspension of
Solicitation;
Amendment or
Supplement:
As provided in the Agency Agreement, the Company may suspend
solicitation of purchases at any time and, upon receipt of at least
one Business Day's prior notice from the Company, the Agents will each
forthwith suspend solicitation until such time as the Company has
advised them that solicitation of purchases may be resumed.
If the Agents receive the notice from the Company contemplated by
Section 4(b) of the Agency Agreement, they will promptly suspend
solicitation and will only resume solicitation as provided in the
Agency Agreement. If the Company decides to amend or supplement the
Registration Statement or the Prospectus relating to the Notes, it
will promptly advise each Agent and will furnish each Agent with the
proposed amendment or supplement in accordance with the terms of the
Agency Agreement. The Company will promptly file such amendment or
supplement; provide the Agents with copies of any such amendment or
supplement; confirm to the Agents that such amendment or supplement
has been filed with the Commission; and advise the Agents that
solicitation may be resumed.
Any such suspension shall not affect the Company's obligations under
the Agency Agreement; and in the event that at the time the Company
suspends solicitation of purchases there shall be any offers already
accepted by the Company outstanding for settlement, the Company will
have the sole responsibility for fulfilling such obligations. The
Company will in addition promptly advise the Agents and the Bank if
such offers are not to be settled and if copies of the Prospectus as
in effect at the time of the suspension may not be delivered in
connection with the settlement of such offers.
Delivery of
Prospectus:
A copy of the Prospectus, as most recently amended or supplemented on
the date of delivery thereof (except as provided below), must be
delivered to a purchaser prior to or together with the earlier of
delivery of (i) the written confirmation provided for above, and (ii)
any Note purchased by such purchaser. The Company shall ensure that
the Presenting Agent receives copies of the Prospectus and each
amendment or supplement thereto (including appropriate pricing
stickers) in such quantities and within such time limits as will
enable the Presenting Agent to deliver such confirmation or Note to a
purchaser as contemplated by these procedures and in compliance with
the preceding sentence. If, since the date of acceptance of a
purchaser's offer, the Prospectus shall have been supplemented solely
to reflect any sale of Notes on
<PAGE>
- -B7-
terms different from those agreed to between the Company and such
purchaser or a change in posted rates not applicable to such
purchaser, such purchaser shall not receive the Prospectus as
supplemented by such new supplement, but shall receive the Prospectus
as supplemented to reflect the terms of the Notes being purchased by
such purchaser and otherwise as most recently amended or supplemented
on the date of delivery of the Prospectus.
Authenticity of
Signatures:
The Company will cause the Bank to furnish the Agents from time to
time with the specimen signatures of each of the Bank's officers,
employees or agents who have been authorized by the Bank to
authenticate Notes, but the Agents will have no obligation or
liability to the Company or the Bank in respect of the authenticity of
the signature of any officer, employee or agent of the Company or the
Bank on any Note.
Advertising Cost: The Company will determine with the Agents the
amount of advertising that may be appropriate in offering the Notes.
Advertising expenses will be paid by the Company.
II. Special Procedures for Book-Entry Notes
Each Note may be represented by either a Global Security delivered to
the Bank, as agent for the Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC or a certificate
delivered to the Holder thereof or a Person designated by such Holder.
An owner of a Book-Entry Note will not be entitled to receive a
certificate representing such Note. In connection with the
qualification of the Book-Entry Notes for eligibility in the
book-entry system maintained by DTC, the Bank will perform the
custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representations from the Company and the Bank to DTC and a Medium-Term
Note Certificate Agreement previously entered into between the Bank
and DTC, and its obligations as a participant in DTC, including DTC's
Same-Day Funds Settlement System ("SDFS"). Except as otherwise set
forth in this Exhibit B, Book-Entry Notes will be issued in accordance
with the administrative procedures set forth in this section.
Issuance:
On any date of settlement (as defined under "Settlement" below), for
one or more Fixed Rate Book-Entry Notes, the Company will issue a
single Global Security in fully registered form without coupons
representing up to $400,000,000 principal amount of all of such Notes
that have the same original issuance date, interest rate and Stated
Maturity. Similarly, on any settlement date for one or more Floating
Rate Book-Entry Notes, the Company will issue a single Global Security
representing up to $400,000,000 principal amount of all of such Notes
that have the same interest rate formula, original issuance date,
Initial Interest Rate, Interest Payment Dates, Index Maturity, Spread
or Spread Multiplier, minimum interest rate (if any), maximum interest
rate (if any) and Stated Maturity. Each Global Security will be dated
and issued as of the date of
<PAGE>
-B8-
its authentication by the Bank, as authenticating agent. Each Global
Security will have an interest accrual date (the "Interest Accrual
Date"), which will be (i) with respect to an original Global Security
(or any portion thereof), its original issuance date and (ii) with
respect to any Global Security (or portion thereof) issued
subsequently upon exchange of a Global Security or in lieu of a
destroyed, lost or stolen Global Security, the most recent Interest
Payment Date to which interest has been paid or duly provided for on
the predecessor Global Security or Securities (or if no such payment
or provision has been made, the original issuance date of the
predecessor Global Security), regardless of the date of authentication
of such subsequently issued Global Security. No Global Security will
represent (i) both Fixed Rate and Floating Rate Book-Entry Notes or
(ii) any Certificated Note.
Identification Numbers:
The Company will arrange, on or prior to commencement of a program for
the offering of Book-Entry Notes, with the CUSIP Service Bureau of
Standard & Poor's Corporation (the "CUSIP Service Bureau") for the
reservation of a series of CUSIP numbers (including tranche numbers),
consisting of approximately 900 CUSIP numbers and relating to Global
Securities representing the Book-Entry Notes. The Company will obtain
from the CUSIP Service Bureau a written list of such series of
reserved CUSIP numbers and will deliver to the Bank and DTC such
written list of 900 CUSIP numbers of such series. The Company will
assign CUSIP numbers to Global Securities as described below under
Settlement Procedure "B." DTC will notify the CUSIP Service Bureau
periodically of the CUSIP numbers that the Company has assigned to
Global Securities. At any time when fewer than 100 of the reserved
CUSIP numbers remain unassigned to Global Securities, and if it deems
necessary, the Company will reserve additional CUSIP numbers for
assignment to Global Securities representing Book-Entry Notes. Upon
obtaining such additional CUSIP numbers the Company shall deliver such
additional CUSIP numbers to the Bank and DTC.
Registration:
Each Global Security will be registered in the name of Cede & Co., as
nominee for DTC, on the Securities Register maintained under the
Indenture governing such Global Security. The beneficial owner of a
Book-Entry Note (or one or more indirect participants in DTC
designated by such owner) will designate one or more participants in
DTC (with respect to such Note, the "Participants") to act as agent or
agents for Such owner in connection with the book-entry system
maintained by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants, a credit
balance with respect to such Note in the account of such Participants.
The ownership interest of such beneficial owner in such Note will be
recorded through the records of such Participants or through the
separate records of such Participants and one or more indirect
participants in DTC.
Transfers:
Transfers of a Book-Entry Note will be accomplished by book entries
made by DTC and, in turn, by Participants (and in certain cases, one
or more indirect participants in DTC) acting on behalf of beneficial
transferors and transferees of such Note.
<PAGE>
-B9-
Consolidation
and Exchange:
The Bank may deliver to DTC and the CUSIP Service Bureau at any time a
written notice of consolidation specifying (i) the CUSIP numbers of
two or more Outstanding Global Securities that represent (A) Fixed
Rate Book-Entry Notes having the same original issuance date, interest
rate and Stated Maturity and with respect to which interest has been
paid to the same date or (B) Floating Rate Book-Entry Notes having the
same interest rate formula, original issuance date, Initial Interest
Rate, Interest Payment Dates, Index Maturity, Spread or Spread
Multiplier, minimum interest rate (if any), maximum interest rate (if
any) and Stated Maturity and with respect to which interest has been
paid to the same date, (ii) a date, occurring at least thirty days
after such written notice is delivered and at least thirty days before
the next Interest Payment Date for such Book-Entry Notes, on which
such Global Securities shall be exchanged for a single replacement
Global Security and (iii) a new CUSIP number, obtained from the
Company, to be assigned to such replacement Global Security. Upon
receipt of such a notice, DTC will send to its participants (including
the Bank) a written reorganization notice to the effect that such
exchange will occur on such date. Prior to the specified exchange
date, the Bank will deliver to the CUSIP Service Bureau a written
notice setting forth such exchange date and the new CUSIP number and
stating that, as of such exchange date, the CUSIP numbers of the
Global Securities to be exchanged will no longer be valid. On the
specified exchange date, the Bank will exchange such Global Securities
for a single Global Security bearing the new CUSIP number and a new
Interest Accrual Date, and the CUSIP numbers of the exchanged Global
Securities will, in accordance with CUSIP Service Bureau procedures,
be canceled and not immediately reassigned. Notwithstanding the
foregoing, if the Global Securities to be exchanged exceed
$400,000,000 in aggregate principal amount, one Global Security will
be authenticated and issued to represent each $400,000,000 of
principal amount of the exchanged Global Securities and an additional
Global Security will be authenticated and issued to represent any
remaining principal amount of such Global Securities (see
"Denominations" below).
Denominations:
Book-Entry Notes will be issued in principal amount of $1,000, or any
amount in excess thereof that is an integral multiple of $1,000.
Global Securities representing one or more Book-Entry Notes will be
denominated in principal amounts not in excess of $400,000,000.
Interest:
General. Interest on each Book-Entry Note will accrue from the
Interest Accrual Date of the Global Security representing such Note.
Each payment of interest on a Book-Entry Note will include interest
accrued through the date preceding, as the case may be, the Interest
Payment Date, Stated Maturity or redemption; provided, however, that
if the Interest Reset Dates with respect to any such Note are daily or
weekly, interest payable on any Interest Payment Date, other than
interest payable on any date on which principal for such Note is
payable, will include interest accrued from but excluding the second
preceding Record Date to and including the next preceding Record Date.
Interest payable at the Stated Maturity or upon redemption of a
Book-Entry Note will be payable to the Person to whom the principal of
such Note is
<PAGE>
-B10-
payable. Standard & Poor's Corporation will use the information
received in the pending deposit message described under Settlement
Procedure "C" below in order to include the amount of any interest
payable and certain other information regarding the related Global
Security in the appropriat weekly bond report published by Standard &
Poor's Corporation.
On the first Business Day of January, April, July and October of each
year the Bank will deliver to the Company and DTC a written list of
Regular Record Dates and Interest Payment Dates that will occur with
respect to Floating Rate Book-Entry Notes during the six-month period
beginning on such first Business Date. Promptly after each Interest
Determination Date (as defined in the Prospectus) for Floating Rate
Notes, the Bank, acting as the calculation agent for Floating Rate
Notes, will notify Standard & Poor's Corporation of the interest rates
determined on such Interest Determination Date.
Payments of Principal
and Interest:
Payments of Interest Only. Promptly after each Record Date, the Bank
will deliver to the Company and DTC a written notice specifying by
CUSIP number the amount of interest to be paid on each Global Security
on the following Interest Payment Date (other than an Interest Payment
Date coinciding with Maturity) and the total of such amounts. DTC will
confirm the amount payable on each Global Security on such Interest
Payment Date by reference to the daily bond reports published by
Standard & Poor's Corporation. The Company will pay to the Bank, as
paying agent, the total amount of interest due on such Interest
Payment Date (other than at Maturity), and the Bank will pay such
amount to DTC at the times and in the manner set forth below under
"Manner of Payment."
Payments at Maturity. On or about the first Business Day of each
month, the Bank will deliver to the Company and DTC a written list of
principal and interest to be paid on each Global Security maturing in
the following month. The Company, the Bank and DTC will confirm the
amounts of such principal and interest payments with respect to each
such Global Security on or about the fifth Business Day preceding the
Maturity of such Global Security. The Company will pay to the Bank, as
the paying agent, the principal amount of such Global Security,
together with interest due at such Maturity. The Bank will pay such
amount to DTC at the times and in the manner set forth below under
"Manner of Payment."
Promptly after payment to DTC of the principal and interest due at the
Maturity of such Global Security, the Bank will cancel such Global
Security and deliver it to the Company with an appropriate debit
advice. On the first Business Date of each month, the Bank will
prepare a written statement indicating the total principal amount of
Outstanding Global Securities for which it serves as paying agent and
authenticating agent as of the immediately preceding Business Day.
Payments Upon Redemption. The Company, the Bank and DTC will confirm
the purchase price and accrued interest payable for each Global
Security to be
<PAGE>
-B11-
redeemed by the Company on or about the fifth
Business Day preceding the redemption of such Global
Security.
Payments Upon Repurchase. The Bank will notify the
Company in a timely manner, but no later that the
fifth Business Day following the end of the
applicable notice period for the holders, of the
receipt of notice for holders requesting repurchase
of Notes. The Company, the Bank and DTC will confirm
the purchase price and accrued interest payable for
each Global Security to be repurchased by the
Company on or about the fifth Business Day preceding
the redemption of such Global Security.
Manner of Payment. The total amount of any principal
and interest due on Global Securities on any
Interest Payment Date or at Maturity, including
Redemption and Repurchase, shall be paid by the
Company to the Bank in funds available for use by
the Bank as of 9:30 A.M. (New York City time) on
such date. The Company will make such payment on
such Global Securities by instructing the Bank to
withdraw funds from an account maintained by the
Company at the Bank. The Company will confirm such
instructions in writing to the Bank. For maturity,
redemption or any other principal payments: prior to
10:00 A.M. (New York City time) on such date or as
soon as possible thereafter, the Bank will make such
payments to DTC in same day funds in accordance with
DTC's Same Day Funds Settlement Paying Agent
Operating Procedures. For interest payments: the
Bank will make such payments to DTC in accordance
with existing arrangements between DTC and the Bank.
DTC will allocate such payments to its participants
in accordance with its existing operating
procedures. Neither the Company (either as issuer or
as Paying Agent) nor the Bank shall have any direct
responsibility or liability for the payment by DTC
to such Participants of the principal of and
interest on the Book-Entry Notes.
The amount of any taxes required under applicable
law to be withheld from any interest payment on a
Book-Entry Note will be determined and withheld by
the Participant, indirect participant in DTC or
other Person responsible for forwarding payments and
materials directly to the beneficial owner of such
Note.
Settlement Procedures:
Settlement Procedures with regard to each Book-Entry Note sold by the
Company through an Agent, as agent, shall be as follows:
A. The Presenting Agent will advise the Company by
telephone, and confirm in writing by
facsimile transmission the following settlement
information:
1. Exact name in which Note is to be
registered ("Registered Owner").
2. Exact address of the Registered Owner and
address for payments of principal and
interest, if any.
3. Taxpayer identification number of the
Registered Owner.
<PAGE>
-B12-
4. Principal amount of the Note (and, if
multiple Notes are to be issued,
denominations thereof).
5. Settlement date.
6. Stated Maturity.
7. Issue Price.
8. Issue date.
9. Trade date.
10. The DTC Participant account number of such
Agent.
11. Interest rate:
(a) Fixed Rate Notes:
i) interest rate
(b) Floating Rate Notes:
i) interest rate basis
ii) initial interest rate
iii) spread and/or spread multiplier,
if any iv)interest rate reset
periods and dates
v) interest payment dates
vi) index maturity
vii) maximum and minimum interest
rates, if any viii) record
dates
ix) interest determination dates
12. The dates and related prices on or after
which the Notes are redeemable at the
option of the Company, and additional
redemption or repurchase provisions, if any.
13. Wire transfer information.
14. Presenting Agent's commission (to b
paid in the form of a discount from the
proceeds remitted to the Company upon
settlement.)
B. The Company will assign a CUSIP number to the Global
Security representing such Note and then advise the
Bank in writing by facsimile transmission of the
information set forth in Settlement Procedure "A"
above, such CUSIP number and the name of such Agent.
The Original Issuance Instructions will be
accompanied by a letter signed by any Officer of the
Company giving the Bank authority to authenticate
the Notes in the manner set forth in the Original
Issuance Instructions.
<PAGE>
-B13-
C. The Bank will enter a pending deposit message
through DTC's Participant Terminal System, providing
the following settlement information to DTC, the
Presenting Agent, Standard & Poor's Corporation and,
upon request, the Trustee under the Indenture
pursuant to which such Note is to be issued:
1. The information set forth in Settlement
Procedure "A."
2. Identification as a Fixed Rate Book-Entry
Note or a Floating Rate Book-Entry Note.
3. Initial Interest Payment Date for such Note,
number of days by which such date succeeds the
related "DTC Record Date" (which term means the
Regular Record Date except in the case of floating
rate notes which reset daily or weekly in which case
it means the date 5 calendar days immediately
preceding the Interest Payment Date) and amount of
interest payable on such Interest Payment Date.
4. Frequency of interest payments (monthly,
semiannually, quarterly, etc.).
5. CUSIP number of the Global Security
representing such Note.
6. Whether such Global Security will
represent any other Book-Entry Note (to
the extent known at such time).
D. The Bank, as authentication agent, will
complete and authenticate the note
certificate evidencing the Global Security
representing such Book-Entry Note.
E. DTC will credit such Note to the Bank's
participant account at DTC.
F. The Bank will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to
(i) debit such Note to the Bank's participant
account and credit such Note to the Presenting
Agent's participant account and (ii) debit the
Presenting Agent's settlement account and credit the
Bank's settlement account for an amount equal to the
price of such Note less the Presenting Agent's
commission.
G. The Presenting Agent will enter an SDFS deliver
order through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to the
Presenting Agent's participant account and credit
such Note to the participant accounts of the
Participants with respect to such Note and (ii)
debit the settlement accounts of such Participants
and credit the settlement account of the Presenting
Agent for an amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures "F" and
"G" will be settled in accordance with SDFS
operating procedures in effect on the settlement
date.
<PAGE>
-B14-
I. The Bank will credit to an account of the
Company maintained at the Bank funds
available for immediate use in the amount
transferred to the Bank in accordance with
Settlement Procedure "F."
J. The Presenting Agent will deliver to the purchaser a
copy of the most recent Prospectus applicable to the
Note with or prior to any written offer of Notes and
the confirmation and payment by the purchaser of the
Note. The Presenting Agent will confirm the purchase
of such Note to the purchaser either by transmitting
to the Participants with respect to such Note a
confirmation order or orders through DTC's
institutional delivery system or by mailing a
written confirmation to such purchaser.
Settlement Procedures
Timetable: For orders of Book-Entry Notes solicited by an
Agent, as agent, and accepted by the Company for
settlement, Settlement Procedures "A" through "J"
set forth above shall be completed as soon as
possible but not later than the respective times
(New York City time) set forth below:
SETTLEMENT
PROCEDURES TIME (New York)
A - B 11:00 A.M. on the Sale Date
C 2:00 P.M. on the Sale Date
D 9:00 A.M. on the Settlement Date
E 10:00 A.M. on the Settlement Date
F - G 2:00 P.M. on the Settlement Date
H 4:45 P.M. on the Settlement Date
I - J 5:00 P.M. on the Settlement Date
If a sale is to be settled more than one
Business Day after the sale date, Settlement
Procedures "A," "B" and "C" shall be completed as
soon as practicable but no later than 11:00 A.M. and
2:00 P.M., as the case may be, on the first Business
Day after the sale date. If the initial interest
rate for a Floating Rate Book-Entry Note has not
been determined at the time that Settlement
Procedure "A" is completed, Settlement Procedures
"B" and "C" shall be completed as soon as such rate
has been determined but no later than 11:00 A.M. and
12:00 Noon, respectively, on the second Business Day
before the settlement date. Settlement Procedure "I"
is subject to extension in accordance with any
extension of Fedwire closing deadlines and in the
other events specified in the SDFS operating
procedures in effect on the settlement date.
If settlement of a Book-Entry Note is
rescheduled or canceled, the Bank will deliver to
DTC, through DTC's Participant Terminal System, a
cancellation message to such effect by no later than
2:00 P.M. on the Business Day immediately preceding
the scheduled settlement date.
<PAGE>
-B15-
Failure to Settle:
If the Bank fails to enter an SDFS deliver order with respect to a
Book-Entry Note pursuant to Settlement Procedure "F," the Bank may
deliver to DTC, through DTC's Participant Terminal System, as soon as
practicable a withdrawal message instructing DTC to debit such Note to
the Bank's participant account. DTC will process the withdrawal
message provided that the Bank's participant account contains a
principal amount of the Global Security representing such Note that is
at least equal to the principal amount to be debited. If a withdrawal
message is processed with respect to all the Book-Entry Notes
represented by a Global Security, the Bank will mark such Global
Security "canceled," make appropriate entries in the Bank's records
and send such canceled Global Security t the Company. The CUSIP number
assigned to such Global Security shall, in accordance with CUSIP
Service Bureau procedures, be canceled and no immediately reassigned.
If a withdrawal message is processed with respect to one or more, but
not all, of the Book-Entry Notes represented by a Global Security, the
Bank will exchange such Global Security for two Global Securities, one
of which shall represent such Book-Entry Note or Notes and shall be
canceled immediately after issuance and the other of which shall
represent the other Book-Entry Notes previously represented by the
surrendered Global Security and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Note is not timely paid to
the Participants with respect to such Note by the beneficial
purchasers thereof (or a Person, including an indirect participant in
DTC, acting on behalf of such purchaser), such Participants and, in
turn, the Agent for such Note may enter SDFS deliver orders through
DTC's Participant Terminal System reversing the orders entered
pursuant to Settlement Procedures "F" and "G," respectively.
Thereafter, the Bank will deliver the withdrawal message and take the
related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to settle with respect
to a Book-Entry Note, DTC may take any actions in accordance with its
SDFS operating procedures then in effect. In the event of a failure to
settle with respect to one or more, but not all, of the Book-Entry
Notes to have been represented by a Global Security, the Bank will
provide, in accordance with Settlement Procedure "D," for the
authentication and issuance of a Global Security representing the
other Book-Entry Notes to have been represented by such Global
Security and will make appropriate entries in its records.
III. Special Procedures for Certificated Notes
The Notes may be issued in physical form as Certificated Notes. The
following Settlement Procedures relate specifically to the issuance of
Certificated Notes.
Details for
Settlement: A. For each offer accepted by the Company, the
Agent who presented such offer (the "Presenting
Agent") shall communicate to (i) the
Company's Financial
<PAGE>
-B16-
Services Unit
and (ii) the Bank by telephone, facsimile
transmission or other acceptable means the
following information (the "Purchase Information"):
1. Exact name in which the Note or Notes
are to be registered ("registered
owner").
2. Exact address of registered owner and
address for payment of principal and
interest, if any.
3. Taxpayer identification number of
registered owner.
4. Principal amount of the Note (and
if multiple Notes are to issued,
denominations thereof).
5. Settlement date.
6. Stated Maturity.
7. Issue Price.
8. Issue date.
9. Trade date.
10. Interest rate:
(a) Fixed Rate Notes:
i) interest rate
(b) Floating Rate Notes:
i) interest rate basis
ii) initial interest rate iii) spread
and/or spread multiplier, if any iv)
interest rate reset periods and dates
v) interest payment dates vi) index
maturity vii) maximum and minimum
interest rates, if any viii) record
dates ix) interest determination
dates
11. The dates and related prices on or after
which the Notes are redeemable at the
option of the Company, and additional
redemption or repurchase provisions, if
any.
12. Wire transfer information.
<PAGE>
-B17-
13. Presenting Agent's commission (to be
paid in the form of a discount from the
proceeds remitted to the Company upon
settlement).
14. Instructions for delivery of Note(s).
The Issue Date of, and the settlement date for,
Notes will be the same. Before accepting any offer
to purchase Notes to be settled in less than three
days, the Company shall verify that the Bank will
have adequate time to prepare and authenticate the
Notes.
B. After receiving the details for each accepted offer
from the Presenting Agent, the Company will, after
recording the details and any necessary
calculations, confirm the Purchase Information by
telephone, facsimile transmission or other
acceptable means, to the Bank.
C. The Bank will complete the Note
assigning to and entering on, each Note a
transaction number and authenticating the Note.
D. The Bank will deliver the Notes to the Presenting
Agent, pursuant to the delivery instructions from
the Company. The Bank will retain a copy of the
Note. The Presenting Agent will cause to be wire
transferred to a bank account designated by the
Company immediately available funds in the amount of
the principal of the Notes, less the applicable
commission.
E. The Presenting Agent, as the Company's agent, will
deliver the Notes against payment by such purchasers
in immediately available funds in the principal
amount of the Notes. Delivery of any confirmation or
a Note will be made in compliance with "Delivery of
Prospectus."
F. The Bank will automatically forward a copy of
the Notes to the Company unless
notified of a fail (See "Fails").
Settlement Procedures
Timetable: For offers accepted by the Company, Settlement
Procedures "A" through "F" set forth above shall be
completed on or before the respective times set
forth below:
<PAGE>
-B18-
SETTLEMENT
PROCEDURES TIME (New York)
A - B 11:00 A.M. on the Next Business Day
after the Trade Date
C 3:00 P.M. on the Business Date prior
to Settlement Date
D 2:15 P.M. on the Settlement Date
E 3:00 P.M. on the Settlement Date
F 5:00 P.M. on the Business Day after
the Settlement Date
Fails:
In the event that a purchaser shall fail to accept delivery of and
make payment for a Note on the settlement date, the Presenting Agent
will notify the Bank and the Company, by telephone, confirmed in
writing. If the Note has been delivered to the Presenting Agent, as
the Company's agent, the Presenting Agent shall return such Note to
the Bank. If funds have been advanced for the purchase of such Note,
the Agent will, immediately upon receipt of such Note, debit the
account of the Company for the amount so advanced and the Company
shall refund the payment previously made by the Presenting Agent in
immediately available funds. Such payments will be made on the
settlement date, if possible, and in any event not later than the
Business Day following the settlement date. If such fail shall have
occurred for any reason other than the failure of the Presenting Agent
to provide a confirmation to the purchaser, the Company will reimburse
the Presenting Agent on an equitable basis for its loss of the use of
funds during the period when they were credited to the account of the
Company. Immediately upon receipt of the Note in respect of which the
fail occurred, the Bank will make appropriate entries to reflect the
fact that the Note was never issued and will mark the Note "Canceled."
The Presenting Agent will not be entitled to any commission with
respect to any Note which the purchaser does not accept or make
payment for.
<PAGE>
Exhibit C
to Agency Agreement
CONSTELLATION ENERGY GROUP, INC.
MEDIUM-TERM NOTES, SERIES B
FORM OF PURCHASE AGREEMENT
INCLUDING
STANDARD PURCHASE PROVISIONS
<PAGE>
CONSTELLATION ENERGY GROUP, INC.
MEDIUM-TERM NOTES, SERIES B
PURCHASE AGREEMENT
[Date]
Constellation Energy Group, Inc.
250 W. Pratt Street, 20th Floor
Baltimore, Maryland 21201-2437
Dear Sirs:
Referring to the Medium-Term Notes, Series B of Constellation Energy
Group, Inc. (the "Company") covered by the registration statement on Form S-3
(No. 333-_________), (such registration statement, including (i) the prospectus
included therein, 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 Company agrees
to sell to the Purchasers, severally, the respective principal amounts of the
Company's Medium-Term Notes, Series B 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
Company by the Purchasers shall be ______% of the 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:
<PAGE>
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
Company on or after: (% of Principal Amount):
-------------- -------------------
-------------- -------------------
-------------- -------------------
<PAGE>
Subject to Repurchase by
the Company at the option of Repurchase Prices
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 Group, Inc. 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.
<PAGE>
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 Company 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 GROUP, INC.
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.
<PAGE>
SCHEDULE A
Name of Purchaser Amount
Total ---------------
$
---------------
<PAGE>
CONSTELLATION ENERGY GROUP, INC.
STANDARD PURCHASE PROVISIONS
From time to time, Constellation Energy Group, Inc., a Maryland
corporation ("Company") 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 Company proposes to issue and sell from time
to time its Medium-Term Notes, Series B ("Notes") registered under the
registration statement referred to in Section 2(a). The Notes will be issued
under an Indenture, dated as of March 24, 1999 between the Company 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 Company. The
Company represents and warrants to and agrees with each Purchaser that:
(a) A registration statement on Form S-3 (No. 333-__________)
covering $500 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 Company by any Purchaser specifically for use therein. The documents
incorporated by
<PAGE>
-2-
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
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 Company 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 Company, at the office of the Company, 250 W.
Pratt Street, 20th Floor, 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 Company 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 Company 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 Company 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 Company, 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.
<PAGE>
-3-
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 Company. The Company 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 Company or of which the Company shall be advised in
writing by the Purchasers shall occur which, in the Company'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 Company 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 Company 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 Company in which the
Closing Date occurs, the Company 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 Company 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 prospectus relating to
the Purchased Notes is required to be
<PAGE>
-4-
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 Company 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 Company 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 Company to be unduly
burdensome.
(f) During the period of five years after the Closing Date, the
Company 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 Company filed with the Commission under the Exchange Act or
mailed to shareholders, and (iii) from time to time, such other
information concerning the Company as you may reasonably request.
(g) The Company 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 Company shall not be obligated to reimburse the Purchasers
for any of the foregoing expenses.
(h) The Company 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 representations
and warranties on the part of the Company herein,
<PAGE>
-5-
to the accuracy of the statements of Company officers made pursuant to
the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions
precedent:
(a) Subsequent to the signing of this Agreement, you shall have
received a letter of PricewaterhouseCoopers LLP, 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:
(i) In their opinion, the consolidated financial
statements and supporting schedule 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 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
<PAGE>
-6-
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 Company or you, shall be contemplated by the
Commission.
(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 as of the date of this
Agreement in or affecting
<PAGE>
-7-
particularly the business or properties of the
Company 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 Company'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) You shall have received an opinion, dated the Closing Date,
of a counsel for the Company to the effect that:
(i) The Company, BGE and Constellation Enterprises, Inc.
(CEI) have been duly incorporated and are validly existing as
corporations in good standing under the laws of the State of
Maryland, with power and authority (corporate and other) to own
their respective properties and conduct their respective
businesses as described in the Prospectus; the Company owns all
of the outstanding shares of common stock of BGE and CEI; and the
Company is duly qualified to do business as a foreign corporation
in good standing in 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 Company and is a valid instrument, legally
binding on the Company and 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 the Purchased Notes have
been duly authorized by all necessary corporate action of the
Company. 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
<PAGE>
-8-
the Purchased Notes), have been duly issued and constitute legal,
valid, and binding obligations of the Company 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 the Closing Date) 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 exhibit thereto or as to the Statement of
Eligibility and Qualification on Form T-l of the Trustee under
the Indenture.
(v) Counsel knows of no approval of any regulatory
authority which is legally required for the valid offering,
issuance, sale and delivery of the Purchased Notes by the Company
under this Agreement (except that such opinion need not pass upon
the requirements of state securities acts);
<PAGE>
-9-
(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 Company 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
Company's Charter or By-Laws or any indenture, mortgage or deed
of trust or other agreement or instrument to which the Company is
a party;
(vii) Each of this Agreement and, the Interest Calculation
Agency Agreement has been duly authorized, executed and delivered
by the Company;
(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.
(e) 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 6(d) subheadings (ii), (iii), (iv)b, (v),
(vii),(viii), and (x) and such other matters as the Agents shall reasonably
request and the Company 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 Company, all other matters governed by
the laws of the State of Maryland and the applicability of the 1935 Act , upon
the opinion of Counsel for the Company referred to above.
In addition, such counsel shall state that such
counsel has participated in conferences
with officers, counsel and other representatives of the Company, representatives
of the independent public accountants for the Company and representatives of the
Purchasers at which the contents of the Registration
<PAGE>
-10-
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 Company), 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).
(f) You shall have received a certificate of the Chairman of the
Board, President or any Vice President and a principal financial or
accounting officer of the Company, 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 representations and warranties of
the Company in this Agreement are true and correct in all material
respects, that the Company 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 Company except
as set forth or contemplated in the Prospectus.
(g) The Company 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
Company without liability or obligation on the part of the Company or any
Purchaser, except as set forth in Section 10 hereof.
7. Conditions of the Obligations of the Company. The
obligations of the Company to sell and
deliver the Purchased Notes are subject to the following condition precedent:
<PAGE>
-11-
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 Company or you, shall be contemplated by the
Commission.
If this condition shall not have been satisfied, then the Company
shall be entitled, by notice in writing or by telecopy to you, to
terminate this Agreement without any liability on the part of the
Company or any Purchaser, except as set forth in Section 10 hereof.
8. Indemnification.
---------------
(a) The Company 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 Company 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 Company 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
Company in writing that such information should no longer be used
therein. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(b) Each Purchaser will indemnify and hold harmless the Company,
each of its directors, each of its officers who have signed the
Registration Statement and each person, if any, who controls the Company
within the meaning of the Act or the Exchange Act, against any losses,
claims, damages or liabilities to which the Company or any such
director,
<PAGE>
-12-
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 Company by such Purchaser
specifically for use therein; and will reimburse any legal or other
expenses reasonably incurred by the Company 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 Company, 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 Company 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.
<PAGE>
-13-
(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 statement or
omission, and any other equitable considerations appropriate under the
circumstances. The Company 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 Company
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 Company 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 Company, except as provided in Section
10. In the event that any Purchaser or Purchasers default in their
<PAGE>
-14-
obligation to
purchase Purchased Notes hereunder, the Company 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 Company 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, warranties, and other
statements of the Company 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 Company 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 Company 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 Company 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 delivered or telecopied and confirmed to
the address furnished in writing for the purpose of such communications
hereunder, or, if sent to the Company, will be delivered or telecopied and
confirmed to it, attention of Treasurer at 250 W. Pratt Street, 20th Floor,
Baltimore, Maryland 21201, telecopier (410) 783-3610;
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.
<PAGE>
Exhibit D
to Agency Agreement
PURCHASE AGREEMENT
------------------
(for purchaser's account)
[Date]
Constellation Energy Group, Inc.
250 W. Pratt Street, 20th Floor
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 Group, Inc., Lehman Brothers Inc., Goldman, Sachs & Co., and Merrill
Lynch, Pierce Fenner & Smith Incorporated dated_______, 2000 (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: ___________________
Interest Reset Dates: ___________________
Interest Determination Dates: ___________________
Calculation Agent: ___________________
<PAGE>
2
Interest Payment Dates: ___________________
Stated Maturity: ___________________
Redeemable at the option Redemption Prices
of the Company on or after: (% of Principal Amount):
------------- ----------------
------------- ----------------
------------- ----------------
Subject to repurchase by
the Company at the option Repurchase Prices
of the holder on: (% of Principal Amount):
------------ ------------------
------------ ------------------
------------ ------------------
Discount: % of Principal Amount
Price to be paid
to Company
(in immediately
available funds): $
-----------------
Settlement Date: , 20
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 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:
<PAGE>
3
(a) the satisfaction, at such Settlement Date, of each of the
conditions set forth in subsections (a), (b) and (d) through (g) 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 Company 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 as
of the date of this Agreement, in or affecting particularly the business or
properties of the Company which, in our judgment, materially impairs the
investment quality of the Notes, (ii) any downgrading in the rating of the
Company'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 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 Company 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 Company
in the United States, other
<PAGE>
4
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.
<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 GROUP, INC.
By:
Exhibit 1(b)
$500,000,000
MEDIUM-TERM NOTES, SERIES B
DUE FROM NINE MONTHS TO THIRTY YEARS
FROM DATE OF ISSUE
INTEREST CALCULATION AGENCY AGREEMENT
THIS AGREEMENT dated as of May_____, 2000 between Constellation Energy
Group, Inc. (hereinafter called the "Issuer"), having its principal
office at 250 W. Pratt Street, 20th Floor, 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, Floor 21 West, New York, New York 10286 Attn:
Corporate Trust Administration.
Recitals of the Issuer
The Issuer proposes to issue from time to time up to $500,000,000
aggregate principal amount of Medium-Term Notes, Series B (the "Notes") under an
indenture dated as of March 24, 1999 (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 at a
<PAGE>
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.
2
<PAGE>
3. The Issuer shall notify the Calculation Agent of the issuance of any
Floating Rate Notes prior to the issuance thereof and, at the time of such
issuance, shall deliver to the Calculation Agent the information required to be
provided by the Company 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 and
expenses, 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
3
<PAGE>
exercise of its powers and duties hereunder as well as the reasonable costs,
including the expenses and fees of counsel in defending any claim, action or
demand, except such as may result from the negligence or willful misconduct 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.
4
<PAGE>
7. The Calculation Agent may consult with counsel of its ow selection
(and notify the Issuer of such consultation) and the 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 o
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;
5
<PAGE>
(iv) the Calculation Agent shall be protected and
shall incur no liability for or in respect of any 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 or 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. The Calculation Agent shall not be responsible to the Issuer or
any 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
6
<PAGE>
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 hereinafte
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 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
7
<PAGE>
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 and expenses) incurred by
such retiring Calculation Agent pursuant to paragraph 5 hereof.
(c) If at any time the Calculation Agent shall
esign 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 affairs for the
purpose of rehabilitation, conservation or liquidation, then a successor
Calculation Agent shall be
8
<PAGE>
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 or any further act on the part of any of the parties hereto.
9
<PAGE>
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, by overnight mail or sent by facsimile or communicated by
telephone (subject, in the case of communication by telephone, to confirmation
dispatched within two business days by letter or facsimile), in the case of the
Issuer, to it at the address set forth in the heading of this Agreement,
Attention: 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.
13. This Agreement may be executed in counterparts and
the executed counterparts shall together constitute a single instrument.
10
<PAGE>
IN WITNESS WHEREOF, this Agreement has been executed and delivered as
of the day and year first above written.
CONSTELLATION ENERGY GROUP, INC.
By:
-
Title: Vice President
THE BANK OF NEW YORK
By:
-
Title:
11
<PAGE>
Exhibit 4(b)
FIXED-RATE MEDIUM TERM NOTE
FRONT
REGISTERED REGISTERED
No. FXR ___
CUSIP
CONSTELLATION ENERGY GROUP, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND
MEDIUM-TERM NOTE, SERIES B
(FIXED-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 Company 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
COMPANY ON OR AFTER (% OF PRINCIPAL AMOUNT)
------------------- -----------------------
------------------- ----------------------
------------------- ----------------------
------------------- ----------------------
------------------- ----------------------
-1-
<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 Group, Inc., a Maryland corporation (herein
called the "Company", 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 March 24, 1999 (the "Indenture"), by and between the
Company 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 Company 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 Company 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 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
-2-
<PAGE>
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 Company (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 Group, Inc. 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 GROUP, INC.
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.
---------------------
Dated: ____________
THE BANK OF NEW YORK
By: ____________________
Authorized Signatory
-3-
<PAGE>
FORM OF FIXED-RATE MEDIUM-TERM NOTE
(REVERSE)
CONSTELLATION ENERGY GROUP, INC.
MEDIUM-TERM NOTE, SERIES B
(FIXED RATE)
This Note is one of a duly authorized issue of debt securities
(the "Securities") of the Company, of a series designated as its Medium-Term
Notes, Series B (herein called the "Notes"), limited (except as otherwise
provided in the Indenture) in aggregate principal amount to $500,000,000, 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 Company,
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 Company 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 Company on
any date on or after the date set forth on the face 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 Company will be given by the Company
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 Company 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 Company 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
-4-
<PAGE>
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.
[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 Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
The Company, the Trustee, the Bank, the Security registrar and
any agent of the Company, 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 Company, 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 Company and the rights of the holders of the Securities of
any series under the Indenture at any time by the Company 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 Company 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 Company 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 Company,
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 of the Indenture or any indenture
supplemental thereto, against any incorporator, stockholder, officer or
director, as such,
-6-
<PAGE>
past, present or future, of the Company 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 New York.
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 Company and hereby does irrevocably constitute and
appoint
=================================================================
Attorney to transfer the said Note on the books of the Company, 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 Company 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 "Option 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 company 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: _______________
-8-
<PAGE>
Exhibit 4(c)
[FRONT]
REGISTERED REGISTERED
No. FLR ____
[CUSIP]
CONSTELLATION ENERGY GROUP, INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND
MEDIUM-TERM NOTE, SERIES B
(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 Company 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: ______________________ %
<PAGE>
CALCULATION AGENT: ______________________
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
COMPANY ON OR AFTER (% OF PRINCIPAL AMOUNT)
------------------ -----------------------
------------------ -----------------------
------------------ -----------------------
------------------ -----------------------
SUBJECT TO REPURCHASE
AT THE OPTION REPURCHASE PRICES
OF THE HOLDER ON (% OF PRINCIPAL AMOUNT)
---------------- -----------------------
------------------ -----------------------
------------------ -----------------------
------------------ -----------------------
------------------ -----------------------
[Remarketing provisions, if any, to be included here]
- -----------------------------------------------------------------
-2-
<PAGE>
Constellation Energy Group, Inc., a Maryland corporation (herein
called the "Company" 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 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 March 24, 1999 (the "Indenture"), by and between the Company 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 Company 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 Company 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 Company (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.
-3-
<PAGE>
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 Group, Inc. 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 GROUP, INC.
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.
Dated:
THE BANK OF NEW YORK
By: ____________________
Authorized Signatory
(REVERSE)
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<PAGE>
(REVERSE)
CONSTELLATION ENERGY GROUP, INC.
MEDIUM-TERM NOTE, SERIES B
(FLOATING RATE NOTE)
This Note is one of a duly authorized issue of debt securities
(the "Securities") of the Company, of a series designated as its Medium-Term
Notes, Series B (herein called the "Notes"), limited (except as otherwise
provided in the Indenture) in aggregate principal amount to $500,000,000, 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 Company,
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
-5-
<PAGE>
Reset Date the rate of interest on this Note shall be the rate determined
in accordance with the provisions of the applicable heading below.
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
-6-
below) of the rate on each Interest Determination Date designated on the
face hereof for commercial paper having the Index Maturity 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.
DETERMINATION OF FEDERAL FUNDS EFFECTIVE RATE.
-8-
<PAGE>
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
USPRIMEONE 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 USPRIMEONE 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 in The City of New York selected by the
Calculation
-9-
<PAGE>
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 adjusted for the
Spread and/or Spread Multiplier, as the case may be, for the immediately
preceding interest reset period.
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<PAGE>
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 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
-11-
<PAGE>
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 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
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<PAGE>
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 the
state of 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 Company 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 Company,
on any date on or after the date set forth on the face 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 Company
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 Company 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 Company 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
-13-
<PAGE>
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.
[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 Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
-14-
<PAGE>
The Company, the Trustee, the Bank, the Security registrar and
any agent of the Company, 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 Company,
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 Company and the rights of the holders of the Securities of
any series under the Indenture at any time by the Company 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 Company 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 Company 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 Company,
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 Company 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 New York.
-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 Company and hereby does irrevocably constitute and
appoint
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Attorney to transfer the said Note on the books of the Company, 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 Company 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 "Option 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 company 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
Donna M. Levy 250 W. Pratt Street
Counsel 23rd Floor
Baltimore, Maryland 21201-2437
410-783-3076
410-783-3079 Fax
[CEG LOGO]
May 5, 2000
Constellation Energy Group, Inc.
c/o David A. Brune
250 W. Pratt Street, 20th Floor
Baltimore, Maryland 21201-2437
Gentlemen:
This opinion is provided in connection with the registration statement
(the "Registration Statement") being filed by Constellation Energy Group,
("Constellation Energy") with the Securities and Exchange Commission ("SEC")
under the Securities Act of 1933, regarding the proposed issuance of up to
$500,000,000 principal amount of Medium Term Notes, Series B (the "Notes").
I am an attorney in the Corporate Unit of Constellation Energy.
Constellation Energy is a Maryland corporation. In connection with this opinion
I, together with other attorneys assisting me, have considered, among other
things: (1) the amended and restated articles of incorporation of Constellation
Energy as further amended by Articles Supplementary dated July 19, 1999 and
Certificate of Correction dated September 13, 1999 (the "Charter"); (2) the
by-laws of Constellation Energy (the "By-Laws"); (3) the Indenture dated as of
March 24, 1999 from Constellation Energy to The Bank of New York under which the
Notes will be issued; (4) the corporate proceedings for the approval and
issuance of the Notes; (5) the Registration Statement; (6) the agency agreement
(including the standard purchase provisions) filed as an exhibit to the
Registration Statement (the "Purchase Agreement"); (7) the provisions of the
Public Utility Holding Company Act of 1935 (the "1935 Act"); and (8) 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 Registration Statement becoming
effective under the Securities Act of 1933; (2) the proper execution,
authentication, and delivery of the Notes upon receipt of the purchase price
pursuant to the Purchase Agreement; and (3) the qualification of the Indenture
under the Trust Indenture Act of 1939.
<PAGE>
May 5, 2000s
Page 2
It is my opinion that when there has been compliance with the
Securities Act of 1933 and the applicable state securities laws, 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.
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 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). In so doing,
I do not admit that I am in the category of persons whose consent is required
under Section 7 of the Securities Act of 1933 or the rules and regulations of
the SEC promulgated thereunder.
Very truly yours,
/s/ Donna Levy
Exhibit 23(b)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated January 19, 2000 relating to the
financial statements and financial statement schedule, which appears in
Constellation Energy Group, Inc.'s Annual Report on Form 10-K for the year ended
December 31, 1999. We also consent to the references to us under the headings
"Experts" in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Baltimore, Maryland
May 5, 2000
Exhibit 24
Page 1 of 2
CONSTELLATION ENERGY GROUP, INC.
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned directors and
officers of Constellation Energy Group, Inc. hereby constitute and appoint C. H.
Poindexter and David A. Brune and each of them their true and lawful attorneys
and agents to do any and all acts and things and to execute, in their name any
and all instruments which said attorneys and agents, or any of them, 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 of not exceeding $500,000,000 principal amount of
Medium-Term Notes, Series B of said Company, maturing not more than thirty years
after the date as of which they are issued, all as authorized by Resolutions
adopted the Board of Directors of Constellation Energy Group, Inc. at a meeting
held on April 28, 2000, 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 statement to be filed with the Securities and Exchange Commission
in respect of said Medium-Term Notes, Series B, to any and all amendments to any
registration statement in respect to said Medium-Term Notes, Series B, or to any
instruments or documents filed as part of or in connection with said
registration statement or amendments to such documents; and each of the
undersigned hereby ratifies and confirms all that said attorneys and agents, or
any of them, 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 28th day of April, 2000.
Signature
Principal Executive
Officer and Director /s/ C. H. Poindexter
--------------------
C. H. Poindexter
Chairman of the Board
and Director
Principal Financial and
Accounting Officer /s/ David A. Brune
------------------
David A. Brune
Vice President
<PAGE>
Exhibit 24
Page 2 of 2
Power of Attorney
In connection with
The registering of
Not exceeding $500
Million of Medium-
Term Notes, Series B
Directors
/s/ H. Furlong Baldwin /s/ James T. Brady
/s/ Beverly B. Byron /s/ Mayo A. Shattuck, III
/s/ J. Owen Cole /s/ Dan A. Colussy
/s/ Edward A. Crooke /s/ James R. Curtiss
/s/ Roger W. Gale /s/ Jerome W. Geckle
/s/ Freeman A. Hrabowski, III /s/ Nancy Lampton
/s/ Charles R. Larson /s/ George L. Russell, Jr.
/s/ Michael D. Sullivan
Dated: April 28, 2000
<PAGE>
= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
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.)
One Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------------
CONSTELLATION ENERGY GROUP, INC.
(Exact name of obligor as specified in its charter)
Maryland 52-1964611
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
250 W. Pratt Street
Baltimore, Maryland 21201
(Address of principal executive offices) (Zip code)
---------------------------
Medium-Term Notes, Series B
(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 2 Rector Street, New York, N.Y. 10006,
the State of New York 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 17
C.F.R. 229.10(d).
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.
-2-
<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 May, 2000.
THE BANK OF NEW YORK
By: /s/ MICHAEL CULHANE
--------------------------
Name: MICHAEL CULHANE
Title: VICE PRESIDENT
-----------------------------------------------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of One Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1999, 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 depository institutions:
Noninterest-bearing balances and currency and coin.. $3,247,576
Interest-bearing balances........................... 6,207,543
Securities:
Held-to-maturity securities......................... 827,248
Available-for-sale securities....................... 5,092,464
Federal funds sold and Securities purchased under
agreements to resell................................ 5,306,926
Loans and lease financing receivables:
Loans and leases, net of unearned
income............... 37,734,000
LESS: Allowance for loan and
lease losses............ 575,224
LESS: Allocated transfer risk
reserve........................ 13,278
Loans and leases, net of unearned income,
allowance, and reserve............................ 37,145,498
Trading Assets......................................... 8,573,870
Premises and fixed assets (including capitalized
leases)............................................. 723,214
Other real estate owned................................ 10,962
Investments in unconsolidated subsidiaries and
associated companies................................ 215,006
Customers' liability to this bank on acceptances
outstanding......................................... 682,590
Intangible assets...................................... 1,219,736
Other assets........................................... 2,542,157
Total assets........................................... $71,794,790
LIABILITIES
Deposits:
In domestic offices................................. $27,551,017
Noninterest-bearing....................... 11,354,172
Interest-bearing.......................... 16,196,845
In foreign offices, Edge and Agreement
subsidiaries, and IBFs............................ 27,950,004
Noninterest-bearing.......................... 639,410
Interest-bearing.......................... 27,310,594
Federal funds purchased and Securities sold under
agreements to repurchase............................ 1,349,708
Demand notes issued to the U.S.Treasury................ 300,000
Trading liabilities.................................... 2,339,554
Other borrowed money:
With remaining maturity of one year or less......... 638,106
With remaining maturity of more than one year
through three years............................... 449
With remaining maturity of more than three years.... 31,080
Bank's liability on acceptances executed and
outstanding......................................... 684,185
Subordinated notes and debentures...................... 1,552,000
Other liabilities...................................... 3,704,252
Total liabilities...................................... 66,100,355
EQUITY CAPITAL
Common stock........................................... 1,135,284
Surplus................................................ 866,947
Undivided profits and capital reserves................. 3,765,900
Net unrealized holding gains (losses) on
available-for-sale securities....................... ( 44,599)
Cumulative foreign currency translation adjustments....
( 29,097)
Total equity capital................................... 5,694,435
Total liabilities and equity capital................... $71,794,790
I, Thomas J. Mastro, 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 issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
================================================================================
Thomas J. Mastro
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.
Thomas A. Renyi
Alan R. Griffith Directors
Gerald L. Hassell
- --------------------------------------------------------------------------------
<PAGE>
