-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Csas1iee5Ex2dkxLvFZEm5rAZbOuge9S+z8HGXe6k3fhnDPDQBUyGz7hQu6mZvR3 rZMYX8dnYhJ1rhxuAd3eow== 0000009466-00-000009.txt : 20000418 0000009466-00-000009.hdr.sgml : 20000418 ACCESSION NUMBER: 0000009466-00-000009 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 20000417 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BALTIMORE GAS & ELECTRIC CO CENTRAL INDEX KEY: 0000009466 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 520280210 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-01910 FILM NUMBER: 602950 BUSINESS ADDRESS: STREET 1: 39 W LEXINGTON ST STREET 2: CHARLES CTR CITY: BALTIMORE STATE: MD ZIP: 21201 BUSINESS PHONE: 4102345511 11-K 1 EMPLOYEE SAVINGS PLAN SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 1998 Commission file number: 1-12869 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Constellation Energy Group, Inc. Employee Savings Plan Address same as issuer B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Constellation Energy Group, Inc. Gas and Electric Building, Charles Center Baltimore, Maryland 21201 1 SIGNATURES The Plan: Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. CONSTELLATION ENERGY GROUP, INC. EMPLOYEE SAVINGS PLAN /s/ Richard D. Honaker Date: June 17, 1999 By:___________________________________ Richard D. Honaker Plan Administrator 2 REPORT OF INDEPENDENT ACCOUNTANTS To the Plan Administrator of the Constellation Energy Group, Inc. Employee Savings Plan We have audited the accompanying statements of net assets available for benefits with fund information of the Constellation Energy Group, Inc. Employee Savings Plan (the Plan), formerly the Baltimore Gas and Electric Company Employee Savings Plan, as of December 31, 1998 and December 31, 1997 and the related statements of changes in net assets available for benefits with fund information for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1998 and 1997, and the changes in net assets available for benefits for the years then ended in conformity with generally accepted accounting principles. Our audit was performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions for the year ended December 31, 1998 are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules are the responsibility of the Plan's management. The supplemental schedules and Fund information have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ Mitchell & Titus L.L.P. ______________________________ Washington, DC June 16, 1999 3 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the Prospectuses of Constellation Energy Group, Inc. on Form S-8 (File No. 333-45051-99) and Forms S-3 (File Nos. 333-75217, 333- 59601-99, and 333-24705) and of Baltimore Gas and Electric Company on Form S-3 (File No. 333-66015) of our report dated June 16, 1999 on the financial statements and supplemental schedules of the Constellation Energy Group, Inc. Employee Savings Plan for the year ended December 31, 1998, which report is included in this Annual Report on Form 11-K. /s/ Mitchell & Titus L.L.P. ______________________________ Baltimore, Maryland June 16, 1999 4 Page 1 of 2 Constellation Energy Group, Inc. Employee Savings Plan Statement of Net Assets Available for Benefits December 31, 1998 Investment Funds
Constellation Energy Interest Income Mutual Total Common Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Assets Value of securities held in trust $539,823,941 $324,473,557 $0 $215,350,384 $0 Value of guaranteed investment contracts 115,465,530 0 115,465,530 0 0 Loans outstanding to plan participants 28,891,912 0 0 0 28,891,912 Short-term investments 8,247,190 260,200 7,959,084 27,906 Accrued dividends receivable 4,398,665 4,398,081 0 584 0 Accrued interest receivable 807 0 0 0 807 Accounts receivable 1,567,083 521,794 469,776 575,513 0 -------------- -------------- -------------- -------------- -------------- Total 698,395,128 329,653,632 123,894,390 215,954,387 28,892,719 -------------- -------------- -------------- -------------- -------------- Liabilities Accounts payable 99,300 67,793 31,507 0 0 -------------- -------------- -------------- -------------- -------------- Total 99,300 67,793 31,507 0 0 -------------- -------------- -------------- -------------- -------------- Net assets available for benefits $698,295,828 $329,585,839 $123,862,883 $215,954,387 $28,892,719 ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. (continued next page) 5 Page 2 of 2 Constellation Energy Group, Inc. Employee Savings Plan Statement of Net Assets Available for Benefits December 31, 1998 (Continued) T. Rowe Price Mutual Funds
Equity New Balanced Equity Index 500 Growth International Mid-Cap Horizons New Income Small Cap Fund Income Fund Fund Stock Fund Stock Fund Growth Fund Fund Fund Value Fund ------------------------------------------------------------------------------------------------------------------- Assets Value of securities held in trust $9,791,132 $86,216,947 $12,293,072 $60,411,423 $11,832,199 $7,583,783 $2,590,838 $2,193,307 $22,437,683 Value of guaranteed investment contracts 0 0 0 0 0 0 0 0 0 Loans outstanding to plan participants 0 0 0 0 0 0 0 0 0 Short-term investments 192 10,986 46 15,609 890 87 38 0 58 Accrued dividends receivable 0 264 0 203 30 0 0 0 87 Accrued interest receivable 0 0 0 0 0 0 0 0 0 Accounts receivable 27,230 175,548 44,194 151,897 38,245 33,900 15,055 6,842 82,602 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Total 9,818,554 86,403,745 12,337,312 60,579,132 11,871,364 7,617,770 2,605,931 2,200,149 22,520,430 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Liabilities Accounts payable 0 0 0 0 0 0 0 0 0 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Total 0 0 0 0 0 0 0 0 0 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Net assets available for benefits $9,818,554 $86,403,745 $12,337,312 $60,579,132 $11,871,364 $7,617,770 $2,605,931 $2,200,149 $22,520,430 ========== ========== ========== ========== ========== ========== ========== ========== ===========
The accompanying notes are an integral part of the financial statements. 6 Page 1 of 2 Baltimore Gas and Electric Company Employee Savings Plan Statement of Net Assets Available for Benefits December 31, 1997 Investment Funds
BGE Common Interest Income Mutual Total Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Assets Value of securities held in trust $534,496,187 $362,505,984 $0 $171,990,203 $0 Value of guaranteed investment contracts 101,752,619 0 101,752,619 0 0 Loans outstanding to plan participants 28,589,210 0 0 0 28,589,210 Short-term investments 20,505,491 170,150 20,319,172 16,169 0 Accrued dividends receivable 4,338,636 4,338,636 0 0 0 Accrued interest receivable 566 0 0 0 566 Accounts receivable 446,338 446,338 0 0 0 -------------- -------------- -------------- -------------- -------------- Total 690,129,047 367,461,108 122,071,791 172,006,372 28,589,776 -------------- -------------- -------------- -------------- -------------- Liabilities Accounts payable 195,526 618 194,908 0 0 -------------- -------------- -------------- -------------- -------------- Total 195,526 618 194,908 0 0 -------------- -------------- -------------- -------------- -------------- Net assets available for benefits $689,933,521 $367,460,490 $121,876,883 $172,006,372 $28,589,776 ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. (continued next page) 7 Page 2 of 2 Baltimore Gas and Electric Company Employee Savings Plan Statement of Net Assets Available for Benefits December 31, 1997 (Continued) Mutual Funds
Total T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price Mutual Balanced Equity Growth Small Cap International Funds Fund Income Fund Stock Fund Value Fund Stock Fund -------------- -------------- -------------- -------------- -------------- -------------- Assets Value of securities held in trust $171,990,203 $7,241,838 $82,168,550 $45,262,623 $27,026,476 $10,290,716 Value of guaranteed investment contracts 0 0 0 0 0 0 Loans outstanding to plan participants 0 0 0 0 0 0 Short-term investments 16,169 0 5,411 4,685 3,991 2,082 Accrued dividends receivable 0 0 0 0 0 0 Accrued interest receivable 0 0 0 0 0 0 Accounts receivable 0 0 0 0 0 0 -------------- -------------- -------------- -------------- -------------- -------------- Total 172,006,372 7,241,838 82,173,961 45,267,308 27,030,467 10,292,798 -------------- -------------- -------------- -------------- -------------- -------------- Liabilities Accounts payable 0 0 0 0 0 0 -------------- -------------- -------------- -------------- -------------- -------------- Total 0 0 0 0 0 0 -------------- -------------- -------------- -------------- -------------- -------------- Net assets available for benefits $172,006,372 $7,241,838 $82,173,961 $45,267,308 $27,030,467 $10,292,798 ============ ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. 8 Page 1 of 4 Constellation Energy Group, Inc. Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1998 Investment Funds
Constellation Energy Interest Income Mutual Total Common Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity - ------------------- Contributions: Participant eligible pay contributions $31,966,159 $6,518,510 $5,981,560 $19,466,089 $0 Net Participant rollover contributions 261,044 10,543 13,380 237,121 0 Employer matching contributions Company stock fund 9,830,195 9,830,195 0 0 0 -------------- -------------- -------------- -------------- -------------- 42,057,398 16,359,248 5,994,940 19,703,210 0 -------------- -------------- -------------- -------------- -------------- Income: Dividends Stock 31,994,119 15,150,492 0 16,843,627 0 Employee stock account 2,361,838 2,361,838 0 0 0 Interest 7,188,349 44,425 7,143,924 0 0 Interest on participant loans 2,604,109 0 0 0 2,604,109 -------------- -------------- -------------- -------------- -------------- 44,148,415 17,556,755 7,143,924 16,843,627 2,604,109 -------------- -------------- -------------- -------------- -------------- Participant loan repayments 0 5,602,480 2,747,305 6,338,412 (14,688,197) -------------- -------------- -------------- -------------- -------------- 0 5,602,480 2,747,305 6,338,412 (14,688,197) -------------- -------------- -------------- -------------- -------------- Participant interfund transfers (net) 0 (12,432,135) 604,024 11,828,111 0 -------------- -------------- -------------- -------------- -------------- 0 (12,432,135) 604,024 11,828,111 0 -------------- -------------- -------------- -------------- --------------
The accompanying notes are an integral part of the financial statements. (continued on next page) 9 Page 2 of 4 Constellation Energy Group, Inc. Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1998 (Continued) Investment Funds
Constellation Energy Interest Income Mutual Total Common Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity (Continued) - ------------------------------- Net appreciation (depreciation) of investments: Net depreciation of common stock ($34,526,697) ($34,526,697) $0 $0 $0 Net appreciation of mutual funds 5,552,393 0 0 5,552,393 0 -------------- -------------- -------------- -------------- -------------- (28,974,304) (34,526,697) 0 5,552,393 0 -------------- -------------- -------------- -------------- -------------- Total additions and net investment activity 57,231,509 (7,440,349) 16,490,193 60,265,753 (12,084,088) -------------- -------------- -------------- -------------- -------------- Distributions: Withdrawal and distribution payments to participants (48,869,202) (25,425,563) (12,171,635) (10,627,935) (644,069) Loans to participants 0 (5,008,739) (2,332,558) (5,689,803) 13,031,100 -------------- -------------- -------------- -------------- -------------- Total Distributions (48,869,202) (30,434,302) (14,504,193) (16,317,738) 12,387,031 -------------- -------------- -------------- -------------- -------------- Change in net assets 8,362,307 (37,874,651) 1,986,000 43,948,015 302,943 Net assets available for benefits, beginning of year 689,933,521 367,460,490 121,876,883 172,006,372 28,589,776 -------------- -------------- -------------- -------------- -------------- Net assets available for benefits, end of year $698,295,828 $329,585,839 $123,862,883 $215,954,387 $28,892,719 ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. 10 Page 3 of 4 Constellation Energy Group, Inc. Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1998 (Continued) T. Rowe Price Mutual Funds
Equity New Balanced Equity Index 500 Growth International Mid-Cap Horizons New Income Small Cap Fund Income Fund Fund Stock Fund Stock Fund Growth Fund Fund Fund Value Fund --------- ------------ ---------- ----------- ----------- ------------ ---------- ----------- ------------- Additions and Net Investment Activity - ------------------- Contributions: Participant eligible pay contributions $998,958 $6,057,623 $1,084,667 $5,038,280 $1,526,888 $874,886 $426,369 $162,988 $3,295,430 Net Participant rollover contributions 2,011 26,919 55,916 48,148 18,709 31,230 18,117 3,972 32,099 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ 1,000,969 6,084,542 1,140,583 5,086,428 1,545,597 906,116 444,486 166,960 3,327,529 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Income: Dividends 289,259 6,580,632 119,531 7,391,324 435,119 159,369 135,496 134,751 1,598,146 Interest 0 0 0 0 0 0 0 0 0 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ 289,259 6,580,632 119,531 7,391,324 435,119 159,369 135,496 134,751 1,598,146 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------ Participant loan repayments 296,617 2,096,275 332,190 1,718,472 449,247 255,822 130,678 73,669 985,442 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- 296,617 2,096,275 332,190 1,718,472 449,247 255,822 130,678 73,669 985,442 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Participant interfund transfers (net) 652,756 (5,094,767) 9,927,210 849,103 (1,005,635) 6,064,124 2,056,013 1,952,308 (3,573,001) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- 652,756 (5,094,767) 9,927,210 849,103 (1,005,635) 6,064,124 2,056,013 1,952,308 (3,573,001) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ------------
The accompanying notes are an integral part of the financial statements. (continued on next page) 11 Page 4 of 4 Constellation Energy Group, Inc. Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1998 (Continued) T. Rowe Price Mutual Funds
Equity New Balanced Equity Index 500 Growth International Mid-Cap Horizons New Income Small Cap Fund Income Fund Fund Stock Fund Stock Fund Growth Fund Fund Fund Value Fund ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Additions and Net Investment Activity (Continued) - ------------------------------- Appreciation (depreciation) of mutual funds Net Appreciation (depreciation) of mutual funds 982,146 843,807 1,509,126 5,183,878 1,170,118 641,097 (39,564) (67,649) (4,670,566) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- 982,146 843,807 1,509,126 5,183,878 1,170,118 641,097 (39,564) (67,649) (4,670,566) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Total additions and net investment activity 3,221,747 10,510,489 13,028,640 20,229,205 2,594,446 8,026,528 2,727,109 2,260,039 (2,332,450) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Distributions: Withdrawal and distribution payments to participants (395,264) (4,385,808) (435,692) (3,045,823) (638,117) (261,334) (50,157) (43,374) (1,372,366) Loans to participants (249,767) (1,894,897) (255,636) (1,871,558) (377,763) (147,424) (71,021) (16,516) (805,221) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Distributions (645,031) (6,280,705) (691,328) (4,917,381) (1,015,880) (408,758) (121,178) (59,890) (2,177,587) ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Change in net assets 2,576,716 4,229,784 12,337,312 15,311,824 1,578,566 7,617,770 2,605,931 2,200,149 (4,510,037) Net assets available for benefits, beginning of year 7,241,838 82,173,961 0 45,267,308 10,292,798 0 0 0 27,030,467 ------------ ----------- ----------- ---------- ----------- ----------- ----------- ----------- ----------- Net assets available for benefits, end of year $9,818,554 $86,403,745 $12,337,312 $60,579,132 $11,871,364 $7,617,770 $2,605,931 $2,200,149 $22,520,430 ========== ========== ========== ========== ========== ========== ========== ========== ==========
The accompanying notes are an integral part of the financial statements. 12 Page 1 of 4 Baltimore Gas and Electric Company Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1997 Investment Funds
BGE Common Interest Income Mutual Total Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity - ------------------- Contributions: Participant eligible pay contributions $30,793,196 $7,760,915 $6,924,097 $16,108,184 $0 Net Participant rollover contributions 461,112 59,435 5,840 395,837 0 Employer matching contributions Company stock fund 9,641,095 9,641,095 0 0 0 -------------- -------------- -------------- -------------- -------------- 40,895,403 17,461,445 6,929,937 16,504,021 0 -------------- -------------- -------------- -------------- -------------- Income: Dividends Stock 31,201,128 15,239,780 0 15,961,348 0 Employee stock account 2,521,116 2,521,116 0 0 0 Interest 7,395,150 51,690 7,343,460 0 0 Interest on participant loans 2,540,609 0 0 0 2,540,609 -------------- -------------- -------------- -------------- -------------- 43,658,003 17,812,586 7,343,460 15,961,348 2,540,609 -------------- -------------- -------------- -------------- -------------- Participant loan repayments 0 6,161,652 3,230,575 5,154,864 (14,547,091) -------------- -------------- -------------- -------------- -------------- 0 6,161,652 3,230,575 5,154,864 (14,547,091) -------------- -------------- -------------- -------------- -------------- Participant interfund transfers (net) 0 (24,105,775) (5,407,252) 29,513,027 0 -------------- -------------- -------------- -------------- -------------- 0 (24,105,775) (5,407,252) 29,513,027 0 -------------- -------------- -------------- -------------- --------------
The accompanying notes are an integral part of the financial statements. (continued on next page) 13 Page 2 of 4 Baltimore Gas and Electric Company Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1997 (Continued) Investment Funds
BGE Common Interest Income Mutual Total Stock Fund Fund Funds Loan Fund -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity (Continued) - ------------------------------- Net appreciation of investments: Net appreciation of common stock $78,944,467 $78,944,467 $0 $0 $0 Net appreciation of mutual funds 14,446,526 0 0 14,446,526 0 -------------- -------------- -------------- -------------- -------------- 93,390,993 78,944,467 0 14,446,526 0 -------------- -------------- -------------- -------------- -------------- Total additions and net investment activity 177,944,399 96,274,375 12,096,720 81,579,786 (12,006,482) -------------- -------------- -------------- -------------- -------------- Distributions: Withdrawal and distribution payments to participants (37,122,722) (20,981,891) (10,108,584) (5,586,587) (445,660) Loans to participants 0 (5,646,795) (2,836,201) (4,036,904) 12,519,900 -------------- -------------- -------------- -------------- -------------- Total Distributions (37,122,722) (26,628,686) (12,944,785) (9,623,491) 12,074,240 -------------- -------------- -------------- -------------- -------------- Change in net assets 140,821,677 69,645,689 (848,065) 71,956,295 67,758 Net assets available for benefits, beginning of year 549,111,844 297,814,801 122,724,948 100,050,077 28,522,018 -------------- -------------- -------------- -------------- -------------- Net assets available for benefits, end of year $689,933,521 $367,460,490 $121,876,883 $172,006,372 $28,589,776 ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. 14 Page 3 of 4 Baltimore Gas and Electric Company Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1997 (Continued) Mutual Funds
Total T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price Mutual Balanced Equity Growth Small Cap International Funds Fund Income Fund Stock Fund Value Fund Stock Fund -------------- -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity - ------------------- Contributions: Participant eligible pay contributions $16,108,184 $923,212 $5,973,535 $4,553,007 $2,898,233 $1,760,197 Net Participant rollover contributions 395,837 24,970 108,734 203,400 29,249 29,484 -------------- -------------- -------------- -------------- -------------- -------------- 16,504,021 948,182 6,082,269 4,756,407 2,927,482 1,789,681 -------------- -------------- -------------- -------------- -------------- -------------- Income: Dividends 15,961,348 237,726 7,909,644 5,548,590 1,720,334 545,054 Interest 0 0 0 0 0 0 -------------- -------------- -------------- -------------- -------------- -------------- 15,961,348 237,726 7,909,644 5,548,590 1,720,334 545,054 -------------- -------------- -------------- -------------- -------------- -------------- Participant loan repayments 5,154,864 294,799 2,007,716 1,457,240 836,170 558,939 -------------- -------------- -------------- -------------- -------------- -------------- 5,154,864 294,799 2,007,716 1,457,240 836,170 558,939 -------------- -------------- -------------- -------------- -------------- -------------- Participant interfund transfers (net) 29,513,027 2,305,383 8,587,423 7,818,259 8,744,960 2,057,002 -------------- -------------- -------------- -------------- -------------- -------------- 29,513,027 2,305,383 8,587,423 7,818,259 8,744,960 2,057,002 -------------- -------------- -------------- -------------- -------------- --------------
The accompanying notes are an integral part of the financial statements. (continued on next page) 15 Page 4 of 4 Baltimore Gas and Electric Company Employee Savings Plan Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1997 (Continued) Mutual Funds
Total T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price T. Rowe Price Mutual Balanced Equity Growth Small Cap International Funds Fund Income Fund Stock Fund Value Fund Stock Fund -------------- -------------- -------------- -------------- -------------- -------------- Additions and Net Investment Activity (Continued) - ------------------------------- Appreciation (depreciation) of mutual funds Net Appreciation (depreciation) of mutual funds 14,446,526 629,485 9,070,273 2,526,215 2,685,419 (464,866) -------------- -------------- -------------- -------------- -------------- -------------- 14,446,526 629,485 9,070,273 2,526,215 2,685,419 (464,866) -------------- -------------- -------------- -------------- -------------- -------------- Total additions and net investment activity 81,579,786 4,415,575 33,657,325 22,106,711 16,914,365 4,485,810 -------------- -------------- -------------- -------------- -------------- -------------- Distributions: Withdrawal and distribution payments to participants (5,586,587) (241,661) (2,822,808) (1,354,296) (863,021) (304,801) Loans to participants (4,036,904) (183,503) (1,747,719) (1,186,463) (585,591) (333,628) -------------- -------------- -------------- -------------- -------------- -------------- Total Distributions (9,623,491) (425,164) (4,570,527) (2,540,759) (1,448,612) (638,429) -------------- -------------- -------------- -------------- -------------- -------------- Change in net assets 71,956,295 3,990,411 29,086,798 19,565,952 15,465,753 3,847,381 Net assets available for benefits, beginning of year 100,050,077 3,251,427 53,087,163 25,701,356 11,564,714 6,445,417 -------------- -------------- -------------- -------------- -------------- -------------- Net assets available for benefits, end of year $172,006,372 $7,241,838 $82,173,961 $45,267,308 $27,030,467 $10,292,798 ============ ============ ============ ============ ============ ============
The accompanying notes are an integral part of the financial statements. 16 CONSTELLATION ENERGY GROUP, INC. EMPLOYEE SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 1. GENERAL DESCRIPTION OF THE PLAN Baltimore Gas and Electric Company (BGE) established the Baltimore Gas and Electric Company Employee Savings Plan and Trust Agreement on July 1, 1978. Effective April 30, 1999, BGE shareholders approved the formation of a holding company Constellation Energy Group, Inc. (the Company) and the Baltimore Gas and Electric Company Employee Savings Plan was amended, restated and renamed as the Constellation Energy Group, Inc. Employee Savings Plan (Plan). There were no other significant Plan changes made at that time. T. Rowe Price Trust Company (T. Rowe Price) is the trustee (Trustee). In addition, TRP Retirement Plan Services, Inc., is the provider of administrative services for the Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). Employees become eligible to make contributions one month after date of hire. After meeting this eligibility requirement, participants are allowed to contribute up to 15% of their eligible pay through regular payroll deductions, under a deferred compensation option and/or a thrift option. Participant contributions under the deferred compensation option are excluded from current year's taxable income, whereas participant contributions under the thrift option are included in current year's taxable income. The Company contributes one-half of the first 6% of eligible pay contributed by participants. The Plan accepts rollovers of employees' eligible rollover distributions from other qualified plans. There are eleven investment fund choices offered for participant contributions: the Constellation Energy Common Stock Fund (formerly the BGE Common Stock Fund), the Interest Income Fund and nine mutual funds. The Interest Income Fund is managed by T. Rowe Price Stable Asset Management, Inc. The mutual funds consist of the T. Rowe Price Balanced Fund, the T. Rowe Price Equity Income Fund, the T. Rowe Price Growth Stock Fund, the T. Rowe Price International Stock Fund, and the T. Rowe Price Small Cap Value Fund and effective January 1, 1998, the following four funds were added, the T. Rowe Price New Income Fund, the T. Rowe Price Equity Index 500 Fund, the T. Rowe Price Mid-Cap Growth Fund and the T. Rowe Price New Horizons Fund (mutual funds). All Company contributions are initially invested by the Trustee in the Constellation Energy Common Stock Fund. 17 1. GENERAL DESCRIPTION OF THE PLAN (Continued) Participant and Company matching contributions are sent, each pay period, to the Trustee, who invests participant contributions as designated, either in (1) the Constellation Energy Common Stock Fund for the purchase (on the open market) or other acquisition (as described in Note 2) of shares of the Company's common stock; (2) the nine T. Rowe Price mutual funds; or (3) the Interest Income Fund, as more fully described below. Dividends and earnings received on any shares held in participants' accounts, except for the shares of Company common stock held in their employee stock accounts, whether in the Constellation Energy Common Stock Fund, or the mutual funds are automatically used to purchase or otherwise acquire additional shares for reinvestment in the corresponding fund, and all earnings on each participant's investment in the Interest Income Fund are automatically reinvested in that fund. Dividends received on shares of Company common stock held in a participant's employee stock account are invested by the Trustee in income-producing investments. Annually, a check is sent to the participant representing the total dividends credited to the participant's employee stock account. Any income earned on the dividends is not paid out annually, but is used to purchase or otherwise acquire additional shares of Company common stock for reinvestment in the participant's employee stock account. The total number of common stock or mutual fund shares purchased for any participant depends upon: (1) the participant's eligible pay; (2) the amount of the participant's eligible pay that is contributed; (3) the amount of that contribution which is designated for investment in the Constellation Energy Common Stock Fund or the mutual funds; (4) the amount of Company matching contributions invested in the Constellation Energy Common Stock Fund; (5) the reinvested dividends and earnings on each investment fund; and (6) the price of common stock or mutual fund shares, at the time of purchase, for each investment fund. 18 1. GENERAL DESCRIPTION OF THE PLAN (Continued) Amounts held in the Interest Income Fund are invested in contracts issued by insurance companies or other financial institutions and in short term investments. Each contract specifies a fixed or variable rate of interest for a certain period of time. The interest rate earned by the Interest Income Fund is a blend of the rates under the various investments. The annual effective rates for 1998 and 1997 were 6.16% and 6.26%, respectively. The crediting interest rates for the investment contracts as of December 31, 1998 and 1997 were 5.94% and 6.65%, respectively. At December 31, 1998 and 1997, there were no investments in the aggregate contracts of any issuer in the Interest Income Fund which exceeded 5% of net assets available for benefits. Contracts included in the Interest Income Fund have been reported at their contract value, which approximates fair market value. All the investments in this fund are held for purposes other than trading. Participants have the right, once a month, to change the amount of their payroll deductions. Participants also have the right to change, on a daily basis, the percentage of their future contributions being invested in each of the eleven investment funds as provided in the Plan. In addition, participants are allowed to initiate, on a daily basis, a transfer of the value of their contributions, including earnings, among the eleven investment funds. Furthermore, as of the beginning of the calendar year in which participants reach age 56, they may initiate, on a daily basis, a transfer of the value of their Company contributions and employee stock account among the eleven investment funds. Under a loan program, participants may borrow up to one-half of their total account balance, with a minimum of $1,000 and a maximum of $50,000. Participants may elect up to five years to repay the loan, unless the loan is used for the purchase of a principal residence, in which case they may elect up to thirty years for repayment. Participants are allowed to have up to two loans outstanding at any time. Principal and interest are repaid through regular payroll deductions or by direct payment. The interest rate on amounts borrowed is set at the time the loan is executed and remains in effect for the duration of the loan. The interest rate for loans is equal to the prime rate plus 1% on the last day of the month preceding the month the loan is initiated. The Plan allows participants to postpone, until withdrawal or distribution, any income tax liability on (1) all Company contributions; (2) participant contributions under the deferred compensation option; and (3) earnings on their contributions and Company contributions. Participant contributions under the thrift option are included in current year's taxable income. 19 1. GENERAL DESCRIPTION OF THE PLAN (Continued) Withdrawals of thrift contributions and Company contributions, including earnings, are allowed to be initiated on a daily basis. All contributions held in participants' accounts are immediately 100% vested. However, participants who withdraw unmatured basic contributions (contributions of up to the first 6% of the participant's eligible pay that had not remained in the Plan for two full calendar years) are suspended from making payroll contributions to the Plan for twelve months. Distributions to participants who retire or terminate active employment are automatically deferred until they either reach age 65 or cease active employment, whichever is later, unless they request an earlier or later distribution. Generally, participants who reach age 70 1/2 must begin receiving their Plan distribution by April 1 of the following year. Furthermore, active employees who attain age 59 1/2 may request to receive a distribution of their deferred compensation account balances. The Plan is administered by the Director - Benefits, Human Resources Division of the Baltimore Gas and Electric Company, as Plan Administrator. Administrative fees charged by institutions, which issue contracts for the Interest Income Fund, are reflected in the effective rate earned by the fund. All other fees and expenses of the Plan, including those of the Trustee, are currently paid by the Company. Brokerage fees, commissions and transfer taxes associated with the purchase, sale, or transfer of shares of common stock for the Constellation Energy Common Stock Fund and mutual fund shares for the nine mutual funds are borne by those funds. Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the Plan are prepared under the accrual method of accounting. Shares of common stock for participant contributions and Company matching contributions currently are purchased for the Constellation Energy Common Stock Fund on the open market, through new issuances or by other acquisition. Mutual fund shares for the T. Rowe Price Mutual Funds are purchased on the open market, except the Trustee may purchase from time to time 20 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) a small number of shares at current market value from participants making withdrawals or interfund transfers or obtaining loans from the Plan. The cost of shares sold from the Constellation Energy Common Stock Fund and the T. Rowe Price Mutual Funds, as a result of participant distributions, withdrawals, interfund transfers or loans, is determined under the average cost method. Withdrawals and distributions to participants are recorded when paid. Leveraging provisions are included in the Plan, but these provisions have not yet been utilized. Shares of common stock in the Constellation Energy Common Stock Fund held by T. Rowe Price Trust Company are valued as of December 31, 1998 and 1997, using the quoted closing market price as reported by the "NYSE--Composite Transactions" published in the eastern edition of The Wall Street Journal. Mutual fund shares held in the T. Rowe Price Mutual Funds, are valued as of December 31, 1998 and 1997 respectively, using the net asset value price of such shares as quoted by the "Mutual Fund Quotations" for such date in the eastern edition of The Wall Street Journal. Participant loans are valued at cost, which approximates fair value. The Plan's investments are stated at fair value except for the various contracts issued by insurance companies or other financial institutions, under the Interest Income Fund, which are fully benefit-responsive and are stated at contract value. Contract value is equal to the aggregate of the net contributions and earnings thereon. The Plan presents in the Statement of Changes in Net Assets Available for Benefits the net appreciation (depreciation) in the fair value of its investments which consists of realized gains or losses and unrealized appreciation (depreciation) on those investments. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. 21 3. SECURITIES HELD IN TRUST Shown below are the shares, with respective market value and cost, which were held in trust in the Constellation Energy Common Stock Fund and the mutual funds on December 31, 1998 and 1997. SHARES HELD MARKET IN TRUST VALUE COST CONSTELLATION ENERGY COMMON STOCK FUND December 31, 1998 10,506,574 $324,473,557 $234,742,256 December 31, 1997 10,624,752 $362,505,984 $226,205,259 T. ROWE PRICE BALANCED FUND December 31, 1998 526,711 $9,791,132 $8,269,771 December 31, 1997 437,838 $7,241,838 $6,474,294 T. ROWE PRICE EQUITY INCOME FUND December 31, 1998 3,275,854 $86,216,947 $72,666,085 December 31, 1997 3,151,843 $82,168,550 $66,812,537 T. ROWE PRICE EQUITY INDEX 500 FUND December 31, 1998 368,300 $12,293,072 $10,877,044 December 31, 1997 - - - T. ROWE PRICE GROWTH STOCK FUND December 31, 1998 1,883,790 $60,411,423 $52,038,870 December 31, 1997 1,561,318 $45,262,623 $40,949,796 T. ROWE PRICE INTERNATIONAL STOCK FUND December 31, 1998 789,399 $11,832,199 $11,031,889 December 31, 1997 766,819 $10,290,716 $10,514,050 T. ROWE PRICE MID-CAP GROWTH FUND December 31, 1998 222,531 $7,583,783 $6,935,540 December 31, 1997 - - - T. ROWE PRICE NEW HORIZONS FUND December 31, 1998 111,011 $2,590,838 $2,617,668 December 31, 1997 - - - T. ROWE PRICE NEW INCOME FUND December 31, 1998 248,983 $2,193,307 $2,254,408 December 31, 1997 - - - T. ROWE PRICE SMALL CAP VALUE FUND December 31, 1998 1,182,870 $22,437,683 $24,488,710 December 31, 1997 1,154,978 $27,026,476 $23,821,921 22 4. TAX STATUS The Company has received the latest favorable determination letter from the Internal Revenue Service, dated May 2, 1997, with respect to the Plan as restated effective June 30, 1995, qualifying the Plan as a stock bonus plan under Section 401 of the Internal Revenue Code (Code) and an employee stock ownership plan under Section 4975(e)(7) of the Code and exempting the Plan from federal income tax under Section 501 of the Code. 5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 The following is a reconciliation of net assets available for benefits per the financial statements to the Form 5500: December 31, 1998 1997 Net assets available for benefits per the financial statements $698,295,828 $689,933,521 Amounts requested by participant's for withdrawals and distributions at December 31, but paid in subsequent years (104,756) (214,050) ------------- ------------- Net assets available for benefits per the Form 5500 $698,191,072 $689,719,471 ============= ============= 23 5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 (Continued) The following is a reconciliation of withdrawals and distributions paid to participants per the financial statements to the Form 5500: Year ended December 31, 1998 Withdrawals and distributions paid to participants per the financial statements $48,869,202 Add: Amounts requested by participants for withdrawals and distributions at December 31, 1998 but paid in 1999 104,756 Less: Amounts requested by participants for withdrawals and distributions at December 31, 1997 but paid in 1998 (214,050) ------------- Withdrawals and distributions to participants per the Form 5500 $48,759,908 ============= Withdrawals and distributions to participants recorded on the Form 5500 for benefit claims include amounts that have been processed and approved for payment prior to December 31 but not yet paid as of that date. 24
Page 1 of 3 Constellation Energy Group (EIN 52-0280210) T. Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan Item 27(a) - Schedule of Assets Held for Investment Purposes December 31, 1998 Current Maturity Identity of Issue Description of Asset Cost Value Date * Group Annuity Contract with Insurance Company Guaranteed Bayerische Landesbnk Interest Contract - Company (98-005-A) Guaranteed Interest - 5.95% 3,052,816 3,052,816 9/13/2002 Group Annuity Contract with Insurance Company Guaranteed Bayerische Landesbnk Interest Contract - Company (98-005-B) Guaranteed Interest - 5.92% 3,091,963 3,091,963 6/25/2003 Group Annuity Contract with Insurance Company Guaranteed Canada Life Assurance Interest Contract - Company (P-45870) Guaranteed Interest - 7.20% 3,115,901 3,115,901 6/15/2000 Group Annuity Contract with Insurance Company Guaranteed Canada Life Assurance Interest Contract - Company (P-45904) Guaranteed Interest - 6.31% 6,016,115 6,016,115 12/15/2000 Group Annuity Contract with Insurance Company Guaranteed Canada Life Assurance Interest Contract - Company (P-45908) Guaranteed Interest - 6.23% 1,518,995 1,518,995 10/16/2000 Group Annuity Contract with Insurance Company Guaranteed Continental Assurance Interest Contract - Company (GP-24100) Guaranteed Interest - 6.32% 7,268,875 7,268,875 9/15/2000 Group Annuity Contract with Insurance Company Guaranteed John Hancock Life Interest Contract - (GAC-8444) Guaranteed Interest - 5.81% 5,832,065 5,832,065 3/15/2001 Group Annuity Contract with Insurance Company Guaranteed Life Insurance Company of Interest Contract - 50% 3/1/2002 Virginia (GS-2987) Guaranteed Interest - 7.25% 6,771,753 6,771,753 Balance 4/1/2002 Group Annuity Contract with Insurance Company Guaranteed Life Insurance Company of Interest Contract - Virginia (GS-3169) Guaranteed Interest - 5.79% 2,035,470 2,035,470 12/15/2002 Group Annuity Contract with Insurance Company Guaranteed Monumental Life Interest Contract - 50% 2/15/2003 (MDA00008FR) Guaranteed Interest - 5.71% 3,511,734 3,511,734 Balance 4/15/2003 Group Annuity Contract with Insurance Company Guaranteed Monumental Life Interest Contract - 50% 4/15/2002 (BDA00729FR) Guaranteed Interest - 6.82% 3,864,436 3,864,436 Balance 6/14/2002 Group Annuity Contract with Insurance Company Guaranteed New York Life Interest Contract - (GA-06750-002) Guaranteed Interest - 6.35% 3,530,569 3,530,569 3/31/1999 Group Annuity Contract with Insurance Company Guaranteed Pacific Mutual Life Interest Contract - (G-26263.01) Guaranteed Interest - 7.31% 7,092,691 7,092,691 6/14/2001
(Continued on next page) * Current Value of the guaranteed interest contracts equal contract value. 25
Page 2 of 3 Constellation Energy Group (EIN 52-0280210) T. Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan Item 27(a) - Schedule of Assets Held for Investment Purposes December 31, 1998 Current Maturity Identity of Issue Description of Asset Cost Value Date * Group Annuity Contract with Insurance Company Guaranteed Protective Life Interest Contract - (GA-1174) Guaranteed Interest - 7.18% $3,879,256 $3,879,256 3/15/2000 Group Annuity Contract with Insurance Company Guaranteed Protective Life Interest Contract - (GA-1348) Guaranteed Interest - 6.77% 2,627,614 2,627,614 1/15/2002 Group Annuity Contract with Insurance Company Guaranteed Protective Life Interest Contract - (GA-1391) Guaranteed Interest - 7.31% 3,376,728 3,376,728 4/15/2002 Group Annuity Contract with Insurance Company Guaranteed Prudential Interest Contract - 50% 01/31/99 (GA-7088-213) Guaranteed Interest - 6.48% 4,072,434 4,072,434 Balance 05/31/99 Group Annuity Contract with Insurance Company Guaranteed SAFECO Life Interest Contract - 2.1 Mil 11/19/2001 (LP1055917-01) Guaranteed Interest - 7.00% 4,210,471 4,210,471 Balance 12/19/2001 Group Annuity Contract with Insurance Company Guaranteed SAFECO Life Interest Contract - $2.1 Mil 11/19/2001 (LP1055917-02) Guaranteed Interest - 7.00% 4,210,471 4,210,471 Balance 12/19/2001 Group Annuity Contract with Insurance Company Guaranteed SAFECO Life Interest Contract - (LP1055917-03) Guaranteed Interest - 6.85% 3,814,378 3,814,378 9/18/2001 Group Annuity Contract with Insurance Company Guaranteed Security Life Denver Interest Contract - (FA-0494) Guaranteed Interest - 6.82% 2,842,375 2,842,375 2/14/2002 Group Annuity Contract with Insurance Company Guaranteed Transamerica Occ. Interest Contract - 50% 09/15/1999 (51266-00) Guaranteed Interest - 7.16% 9,582,943 9,582,943 Balance 12/15/1999 Investment Contract with Synthetic Investment Agreement State Street Bank and Trust Interest Contract Company (98255) Variable Interest-5.984% initially 20,145,477 20,145,477 None ------------ ------------ 115,465,530 115,465,530
(Continued on next page) * Current Value of the guaranteed interest contracts equal contract value. 26
Page 3 of 3 Constellation Energy Group (EIN 52-0280210) T. Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan Item 27(a) - Schedule of Assets Held for Investment Purposes December 31, 1998 Current Maturity Identity of Issue Description of Asset Cost Value Date * ** Constellation Energy Group, Inc. Common Stock - no par 234,742,256 324,473,557 - T. Rowe Price Balanced Fund Mutual Fund 8,269,771 9,791,132 - T. Rowe Price Equity Income Fund Mutual Fund 72,666,085 86,216,947 - T. Rowe Price Equity Index 500 Fund Mutual Fund 10,877,044 12,293,072 - T. Rowe Price Growth Stock Fund Mutual Fund 52,038,870 60,411,423 - T. Rowe Price International Fund Mutual Fund 11,031,889 11,832,199 - T. Rowe Price Mid-Cap Growth Fund Mutual Fund 6,935,540 7,583,783 - T. Rowe Price New Horizons Fund Mutual Fund 2,617,668 2,590,838 - T. Rowe Price New Income Fund Mutual Fund 2,254,408 2,193,307 - T. Rowe Price Small Cap Value Fund Mutual Fund 24,488,710 22,437,683 - ** Loan Fund (Interest) Participant Loan Fund - 28,891,912 - Interest Range 8.25 - 9.75% T. Rowe Price Prime Reserve Fund Money Market Mutual Fund 7,943,304 7,943,304 - T. Rowe Price Short Term Money Market Bank Account 199,044 199,044 - Settlement Account T. Rowe Price Short Term Money Market Bank Account 104,842 104,842 - Distribution Account ------------ ------------ Total $549,634,961 $692,428,573 =========== ===========
* Current Value of the guaranteed interest contracts equal contract value. ** Parties-in-Interest 27 -----END PRIVACY-ENHANCED MESSAGE-----