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 Plan year ended: December 31, 2001
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
------------------------------------------------------
Constellation Energy Group, Inc.
250 W. Pratt St.
Baltimore, Maryland 21201
B. Name of issuer of the securities held pursuant to the
plan and the address of its principal executive office:
Constellation Energy Group, Inc.
250 W. Pratt St.
Baltimore, Maryland 21201
CONSTELLATION ENERGY GROUP, INC.
EMPLOYEE SAVINGS PLAN
TABLE OF CONTENTS
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Page
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Signature............................................................... 3
Independent Auditors' Report............................................ 4
Consent of Independent Auditors......................................... 5
Index to Financial Statements:
Statements of Net Assets Available for Benefits................ 6
Statements of Changes in Net Assets Available for Benefits..... 7
Notes to Financial Statements........................................... 9
Supplemental Schedule:
Schedule of Assets Held for Investment Purposes................ 19
- 2 -
SIGNATURE
---------
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
DATE: June 25, 2002
BY: /s/ Richard D. Honaker
--------------------------------------
Richard D. Honaker, Plan Administrator
- 3 -
INDEPENDENT AUDITOR'S REPORT
---------------------------
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
of the Constellation Energy Group, Inc. Employee Savings Plan (the Plan), as of
December 31, 2001 and December 31, 2000 and the related statements of changes in
net assets available for benefits 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 audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audits 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 audits provide 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, 2001 and 2000, and the changes in net assets available for benefits
for the years then ended in conformity with accounting principles generally
accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of financial
information for the year ended December 31, 2001 is presented for the purpose of
additional analysis and is not a required part of the basic financial statements
but is 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 schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
/s/ Mitchell & Titus L.L.P.
---------------------------
Mitchell & Titus L.L.P.
Washington, DC
June 25, 2002
- 4 -
CONSENT OF INDEPENDENT AUDITORS
-------------------------------
We hereby consent to the incorporation by reference in the Prospectuses of
Constellation Energy Group, Inc. on Form S-3 and Form S-8 (File Nos. 333-81352,
333-36380, 333-59601, 33-57658, 333-56572, 333-24705, and 33-49801 and 33-59545,
333-45051, 333-46980, 33-56084, 333-81292, and 333-89046, respectively) of
Constellation Energy Group, Inc. of our report dated June 25, 2002 on the
financial statements and supplemental schedule of the Constellation Energy Group
Employee Savings Plan, for the Plan year ended December 31, 2001, which report
is included in this Annual Report on Form 11-K.
/s/ Mitchell & Titus L.L.P.
---------------------------
Mitchell & Titus L.L.P.
Washington, DC
June 25, 2002
- 5 -
Constellation Energy Group, Inc.
Employee Savings Plan
Statement of Net Assets Available for Benefits
December 31, 2001
CEG Common Interest Income Mutual
Total Stock Fund Fund Funds Loan Fund
-------------- -------------- -------------- -------------- --------------
ASSETS:
Securities held in trust $584,478,529 $285,815,104 $ 18,568,008 $280,095,417 $ 0
Guaranteed investment contracts 91,372,064 0 91,372,064 0 0
Participant loans 26,434,139 0 0 0 26,434,139
Short-term investments 12,802,817 64,271 12,716,459 22,087 0
Accrued dividends receivable 1,273,382 1,257,578 15,804 0 0
Accrued interest receivable 1,086 0 0 0 1,086
Accounts receivable 73,191 73,155 0 36 0
------------- ------------- ------------- ------------- -------------
Total 716,435,208 287,210,108 122,672,335 280,117,540 26,435,225
------------- ------------- ------------- ------------- -------------
LIABILITIES:
Accounts payable 139,519 74,865 63,112 1,542 0
------------- ------------- ------------- ------------- -------------
Net assets available for
benefits end of year $716,295,689 $287,135,243 $122,609,223 $280,115,998 $26,435,225
============== ============== ============= ============= =============
The accompanying notes of these financial statements.
Constellation Energy Group, Inc.
Employee Savings Plan
Statement of Net Assets Available for Benefits
December 31, 2000
CEG Common Interest Income Mutual
Total Stock Fund Fund Funds Loan Fund
-------------- -------------- --------------- -------------- ------------
ASSETS:
Securities held in trust $754,987,098 $471,659,544 $ 0 $283,327,554 $ 0
Guaranteed investment contracts 113,798,992 0 113,798,992 0 0
Participant loans 27,822,772 0 0 0 27,822,772
Short-term investments 3,711,030 364,822 3,303,490 42,718 0
Accrued dividends receivable 4,444,809 4,428,749 16,060 0 0
Accrued interest receivable 1,086 0 0 0 1,086
Accounts receivable 435,320 2,323 391,871 0 41,126
------------- ------------- ------------- ------------- -------------
Total 905,201,107 476,455,438 117,510,413 283,370,272 27,864,984
------------- ------------- ------------- ------------- -------------
LIABILITIES:
Accounts payable 408,242 382,949 25,293 0 0
------------- ------------- ------------- ------------- -------------
Net assets available for
benefits end of year $904,792,865 $476,072,489 $117,485,120 $283,370,272 $27,864,984
============= ============= ============= ============= =============
The accompanying notes are an integral part of these financial statements.
- 6 -
Constellation Energy Group, Inc.
Employee Savings Plan
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2001
CEG Common Interest Income Mutual
Total Stock Fund Fund Funds Loan Fund
-------------- -------------- --------------- -------------- --------------
ADDITIONS
Contributions:
Participant contributions $ 38,881,741 $ 8,448,075 $ 5,191,204 $ 25,242,462 $ 0
Participant rollover contributions 1,544,299 196,082 368,684 979,533 0
Employer matching contributions 11,184,880 11,184,880 0 0 0
----------- ----------- ---------- ----------- -----------
51,610,920 19,829,037 5,559,888 26,221,995 0
----------- ----------- ---------- ----------- -----------
Income:
Dividends 12,861,551 5,071,259 0 7,790,292 0
Interest 7,078,097 0 7,078,097 0 0
Interest on participant loans 2,511,720 0 0 0 2,511,720
----------- ----------- ---------- ----------- -----------
22,451,368 5,071,259 7,078,097 7,790,292 2,511,720
Participant transfers (net) 0 4,189,607 3,209,533 (7,399,140) 0
Participant loan repayments 0 5,121,467 1,880,924 6,404,564 (13,406,955)
Net appreciation (depreciation) (209,062,616) (191,168,866) 0 (17,893,750) 0
------------- ------------- ----------- ----------- ------------
Total Additions: (135,000,328) (156,957,496) 17,728,442 15,123,961 (10,895,235)
------------- ------------- ----------- ----------- ------------
DEDUCTIONS
Withdrawals and distribution (53,496,848) (28,312,863) (11,085,969) (13,284,803) (813,213)
Loans to participants 0 (3,666,887) (1,518,370) (5,093,432) 10,278,689
----------- ------------ ------------ ------------ -----------
Total Deductions: (53,496,848) (31,979,750) (12,604,339) (18,378,235) 9,465,476
------------ ------------ ------------ ------------ ---------
Change in net assets (188,497,176) (188,937,246) 5,124,103 (3,254,274) (1,429,759)
Net assets available for benefits
beginning of year 904,792,865 476,072,489 117,485,120 283,370,272 27,864,984
------------ ------------ ------------ ------------ ----------
Net assets available for
benefits end of year $716,295,689 $287,135,243 $122,609,223 $280,115,998 $26,435,225
============ ============ ============ ============ ===========
The accompanying notes are an integral part of these financial statements.
- 7 -
Constellation Energy Group, Inc.
Employee Savings Plan
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2000
CEG Common Interest Income Mutual
Total Stock Fund Fund Funds Loan Fund
------------- -------------- --------------- -------------- -------------
ADDITIONS
Contributions:
Participant contributions $ 36,725,447 $ 6,489,691 $ 5,370,877 $ 24,864,879 $ 0
Participant rollover contributions 501,831 44,244 177,107 280,480 0
Employer matching contributions 10,760,781 10,760,781 0 0 0
----------- ----------- ---------- ----------- -----------
47,988,059 17,294,716 5,547,984 25,145,359 0
----------- ----------- ---------- ----------- -----------
Income:
Dividends 50,692,822 17,913,871 0 32,778,951 0
Interest 7,337,994 0 7,337,994 0 0
Interest on participant loans 2,560,262 0 0 0 2,560,262
---------- ----------- ----------- ----------- -----------
60,591,078 17,913,871 7,337,994 32,778,951 2,560,262
Participant transfers (net) 0 (14,383,163) (2,104,229) 16,487,392 0
Participant loan repayments 0 4,904,303 2,068,148 6,966,510 (13,938,961)
Net appreciation (depreciation) 141,029,712 168,749,916 0 (27,720,204) 0
------------ ------------ ----------- ----------- ------------
Total Additions: 249,608,849 194,479,643 12,849,897 53,658,008 (11,378,699)
------------ ------------ ----------- ----------- ------------
DEDUCTIONS
Withdrawals and distribution (85,147,074) (39,894,951) (19,711,583) (24,889,506) (651,034)
Loans to participants 0 (4,615,320) (1,889,060) (5,722,520) 12,226,900
----------- ------------ ------------ ------------ ----------
Total Deductions: (85,147,074) (44,510,271) (21,600,643) (30,612,026) 11,575,866
----------- ------------ ------------ ------------ ----------
Change in net assets 164,461,775 149,969,372 (8,750,746) 23,045,982 197,167
Net assets available for benefits
beginning of year 740,331,090 326,103,117 126,235,866 260,324,290 27,667,817
------------ ------------ ------------ ------------ ----------
Net assets available for
benefits end of year $904,792,865 $476,072,489 $117,485,120 $283,370,272 $27,864,984
============= ============= ============ ============= ===========
The accompanying notes are an integral part of these financial statements.
- 8 -
CONSTELLATION ENERGY GROUP, INC.
EMPLOYEE SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 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. (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.
The Plan is a defined contribution plan, subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
Eligibility - An employee must have one month of service to be eligible to
participate in the Plan.
Administration - The Plan Administrator is the Director - Benefits, Human
Resources Division of Constellation Energy Group, Inc. The assets are held and
managed by the Trustee, T. Rowe Price Trust Company (Trustee). TRP Retirement
Plan Services, Inc. provides the record keeping for the Plan.
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.
The Plan is not subject to, nor insured by, the Pension Benefit Guaranty
Corporation established by the Employee Retirement Income Security Act of 1974.
Contributions - Eligible participants may contribute from 1% to 15% of their
eligible pay through payroll deductions, on a before-tax basis (Deferred
Compensation Option), from 1% to 15% of their eligible pay through an after-tax
basis (Thrift Option), or a combination thereof. The maximum combined
contribution rate for both the before-tax and the after-tax contributions is
15%. The first 6% that a participant contributes are considered "basic
contributions," any additional contributions are considered "supplemental."
- 9 -
The Plan allows participants to postpone, until withdrawal or distribution, any
income tax liability on (1) all Company contributions; (2) participant
contributions under the before-tax option; and (3) earnings on their
contributions and Company contributions. Participant contributions under the
after-tax option are included in current year's taxable income.
The maximum amount a participant can contribute to the Plan on a before-tax
basis is limited per year by the Internal Revenue Service. The limitation for
2001 was $10,500.
Effective January 1, 2002, the allowable percentage for contributions to the
before-tax option was increased from 15% to 25% and the combined maximum was
increased from 15% to 25%. No change was made to the maximum after-tax
contribution limit. Also effective January 1, 2002, the Plan was amended to
allow participants age 50 or older to make catch-up contributions as provided by
the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA).
The Plan accepts rollovers of employees' eligible rollover distributions from
other qualified plans.
Participants have the right, on a daily basis, to change the amount of their
payroll deductions, effective the beginning of the following month. Participants
also have the right to change, on a daily basis, the percentage of their future
contributions being invested in each of the available investment funds as
provided in the Plan.
Company Matching Contributions - The Company contributes an amount equal to
one-half of the participant's first six percent of contributions. All company
matching contributions are fully and immediately vested upon being credited to
the participant's account. Company contributions are initially invested in the
CEG Common Stock Fund.
Investment Options - Participants can elect to have their contributions invested
in the following:
>> CEG Common Stock Fund
>> Interest Income Fund
>> T. Rowe Price Mutual Funds:
o T. Rowe Price Balanced Fund
o T. Rowe Price Equity Income Fund
o T. Rowe Price Equity Index 500 Fund
o T. Rowe Price Growth Stock Fund
o T. Rowe Price International Stock Fund
o T. Rowe Price Mid-Cap Growth Fund
o T. Rowe Price New Horizons Fund
o T. Rowe Price New Income Fund
o T. Rowe Price Small Cap Value Fund
- 10 -
Leveraging Provisions - Leveraging provisions are included in the Plan, but
these provisions have never been utilized. Effective January 1, 2002, the Plan
was amended to eliminate these provisions.
CEG Common Stock Fund - Participant and company matching contributions in the
CEG Common Stock Fund are invested in Constellation Energy Group, Inc. common
stock.
Employee Stock Account - An Employee Stock Account was automatically established
for each participant who transferred their balance from the Baltimore Gas and
Electric Company Employee Stock Ownership Plan upon the termination of that plan
in 1989 and/or received shares of stock credited under the Corporate Performance
Award Program. No additional allocations are being made to this account.
Interest Income Fund - 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. A component of the Interest Income Fund
is invested in the T. Rowe Price Managed Bond Common Trust Fund (Managed Bond
Fund), a direct filing entity, pursuant to Department of Labor Regulations. An
additional component is the T. Rowe Price Stable Value Common Trust Fund, an
investment similar in nature to the underlying investments in the Interest
Income Fund, with a higher degree of diversification. All maturing contracts are
being invested in the Stable Value Common Trust Fund.
The interest rate earned by the Interest Income Fund is a blend of the rates
under the various investments. The annual effective rates for 2001 and 2000 were
6.09% and 6.25%, respectively. The crediting interest rates for the investment
contracts as of December 31, 2001 and 2000 were 5.91% and 6.15%, respectively.
At December 31, 2001 and 2000, there were no investments in the individual
contracts of any issuer in the Interest Income Fund which exceeded five percent
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.
Investment Income - Except for shares of CEG common stock in the Employee Stock
Account, all dividends and interest earned are automatically reinvested in that
fund.
The Trustee invests dividends received on shares of CEG common stock in the
Employee Stock Account, in income-producing investments. Annually, a check is
sent to the participant representing the total dividends credited. Any income
earned on the dividends is reinvested and used to purchase additional shares of
CEG common stock in the Employee Stock Account. In February 2002, a final
distribution was made of all remaining dividends earned on the Employee Stock
Account. Subsequent dividends are reinvested to purchase additional shares of
stock.
- 11 -
Transfers -Participants are allowed to initiate, on a daily basis, a transfer of
the value of their contributions, including earnings, among the available
investment funds.
In addition, 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 matching contributions and Employee Stock Account among the eleven
investment funds. Effective January 1, 2002, the Plan was amended to allow all
participants to immediately transfer their matching contributions and Employee
Stock Account into any of the other available funds at their discretion.
Participant Loan Provisions - Participants may obtain a loan in any amount
between a minimum of $1,000 and a maximum of $50,000, but not more than 50% of
the participant's account balance. 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 30 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 for loans is equal to the prime rate plus one
percent on the last day of the month proceeding the month the loan is initiated.
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.
Withdrawals and Distributions - A participant may, on a daily basis, elect to
withdraw all or part of the stock and cash attributable to their after-tax
contributions. Except for death, disability, retirement, or under certain
circumstances of hardship, contributions made on a before-tax basis may not be
withdrawn until a participant attains age 59 1/2. Participants who withdraw
basic before-tax and after-tax contributions that have not been in the Plan for
two full calendar years (unmatured), and participants who make a Hardship
Withdrawal, are suspended from making contributions to the Plan for twelve
months. Company matching contributions that have been in the Plan for two full
calendar years (matured) are also eligible to be withdrawn. Effective January 1,
2002, the suspension period was reduced to six months.
Distributions to participants who retire or terminate active employment are
automatically deferred until sixty days after 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. Effective January 1, 2002, the
distribution options were expanded to allow for monthly and quarterly
installments for up to 10 years.
Withdrawals and distributions to participants are recorded when paid.
Vesting - All contributions that are held in participants' accounts are
immediately 100% vested.
- 12 -
Administrative costs - Administrative fees charged by institutions, which issue
contracts for the Interest Income Fund, are reflected in the effective rate
earned by the fund. The Company currently pays all the other fees and expenses
of the Plan, including those of the Trustee. Brokerage fees, commissions, and
transfer taxes associated with the purchase, sale, or transfer of shares of
common stock for the CEG Common Stock Fund. All expenses and other charges
incurred by the mutual funds are borne by those respective funds. Effective
January 1, 2002, participants were charged the nominal loan initiation fee
previously paid for by the Company.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------
The financial statements of the Plan are prepared under the accrual method of
accounting. The accounting principals and practices that affect the more
significant elements of the financial statements are:
Valuation of Investments - Shares of common stock in the CEG Common Stock Fund
held by T. Rowe Price Trust Company are valued as of December 31, 2001 and 2000,
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, 2001 and 2000, 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.
Shares of CEG common stock are purchased 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 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 CEG 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.
Loans to participants are valued at their outstanding principal amount.
- 13 -
Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America,
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent gains and losses
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.
NOTE 3. TAX STATUS
------------------
The Company has received the latest favorable determination letter from the
Internal Revenue Service (IRS), 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.
On February 26, 2002, the Company submitted a request to the IRS on the
qualification of the Constellation Energy Group, Inc. Employee Savings Plan as
amended January 1, 2002. Included with that filing was a change to the
description of the purpose of the Plan. Effective January 1, 2002, the Plan was
designated as a stock bonus plan. Also effective January 1, 2002, the Company
stated its intent that the Plan also meet the requirements of an Employee Stock
Ownership Plan under Code Section 4975(e)(7) through February 28, 2002, and to
meet the definition of a participant directed individual account retirement plan
as defined by Section 404(c) of ERISA. As of the date of this report, the
Company has not received a response regarding this request.
NOTE 4. INVESTMENTS
-------------------
Investments which exceed five percent of the Plan's net assets as of
December 31, 2001 and December 31, 2000, include:
2001 2000
---- ----
CEG Common Stock Fund
10,765,100 and 10,458,562 shares,
respectively $287,135,243* $476,072,489*
Interest Income Fund $122,609,223 $117,485,120
T. Rowe Price Equity Income Fund
3,104,449 and 2,903,619 shares,
respectively $ 73,431,189 $ 71,632,563
T. Rowe Price Growth Stock Fund
2,980,736 and 2,986,869 shares,
respectively $ 72,078,703 $ 81,265,025
---------------------
*Includes participant and non-participant-directed investments.
- 14 -
NOTE 5. SECURITIES HELD IN TRUST
--------------------------------
Shown below are the shares, with respective fair value and cost, which were held
in trust in the CEG Common Stock Fund and the mutual funds on December 31, 2001
and 2000.
SHARES HELD MARKET
IN TRUST VALUE COST
-------- ----- ----
CEG COMMON STOCK FUND
December 31, 2001 10,765,100 $285,815,104 $277,080,709
December 31, 2000 10,458,562 $471,659,544 $258,328,484
T. ROWE PRICE BALANCED FUND
December 31, 2001 673,037 $11,771,411 $11,668,575
December 31, 2000 601,194 $11,524,890 $10,353,190
T. ROWE PRICE EQUITY INCOME FUND
December 31, 2001 3,104,449 $73,420,439 $71,627,958
December 31, 2000 2,903,619 $71,632,290 $66,697,119
T. ROWE PRICE EQUITY INDEX 500 FUND
December 31, 2001 877,366 $27,058,236 $30,284,871
December 31, 2000 844,447 $29,977,886 $29,774,049
T. ROWE PRICE GROWTH STOCK FUND
December 31, 2001 2,980,736 $72,074,519 $85,584,111
December 31, 2000 2,986,869 $81,242,840 $88,071,408
T. ROWE PRICE INTERNATIONAL STOCK FUND
December 31, 2001 1,218,268 $13,388,815 $18,014,265
December 31, 2000 1,219,955 $17,713,743 $19,102,949
T. ROWE PRICE MID-CAP GROWTH FUND
December 31, 2001 755,545 $29,768,588 $28,529,749
December 31, 2000 699,572 $27,835,961 $26,567,685
T. ROWE PRICE NEW HORIZONS FUND
December 31, 2001 798,368 $18,067,143 $21,183,757
December 31, 2000 804,607 $19,222,053 $22,620,637
- 15 -
T. ROWE PRICE NEW INCOME FUND
December 31, 2001 523,794 $4,546,536 $4,537,384
December 31, 2000 232,856 $1,979,274 $2,007,224
T. ROWE PRICE SMALL CAP VALUE FUND
December 31, 2001 1,323,887 $29,999,730 $26,603,140
December 31, 2000 1,159,802 $22,198,617 $22,834,973
NOTE 6. 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, 2001 December 31, 2000
----------------- -----------------
Net assets available for benefits per the
financial statements $716,295,689 $904,792,865
Amounts requested by participant's for
withdrawals and distributions at
December 31, but paid in subsequent years (103,199) (55,862)
------------- -------------
Net assets available for benefits
per the Form 5500 $716,192,490 $904,737,003
============= =============
- 16 -
The following is a reconciliation of withdrawals and distributions paid to
participants per the financial statements to the Form 5500:
December 31, 2001
-----------------
Withdrawals and distributions paid
to participants per the financial statements $53,496,848
Add:
Amounts requested by participants for withdrawals
and distributions at December 31, 2001 paid in 2002 103,199
Less:
Amounts requested by participants for withdrawals
and distributions at December 31, 2000 paid in 2001 (55,862)
-----------------
Withdrawals and distributions to participants
per the Form 5500 $53,544,185
=================
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.
NOTE 7. CURRENT CORPORATE STRATEGY
----------------------------------
On October 26, 2001, the Company announced the decision to remain a single
company and canceled prior plans to separate our merchant energy business from
our other businesses and terminated our power business services agreement with
Goldman Sachs. This decision had no impact on the Plan.
NOTE 8. SUBSEQUENT PLAN CHANGES
-------------------------------
Unless otherwise indicated, the following Plan changes were made effective
January 1, 2002:
>> The purpose of the Plan was modified to meet the definition of a
participant directed individual account retirement plan as defined by
Section 404(c) of ERISA.
>> Effective March 1, 2002, the Plan ceased to be classified as an Employee
Stock Ownership Plan under Code Section 4975(e)(7).
- 17 -
>> The before-tax contribution limit and the combined limit were increased
from 15% to 25% and a provision allowing catch-up contributions was
adopted.
>> Leveraging provisions were eliminated.
>> In 2001, a decision was made to invest all maturing proceeds from
investments in the Interest Income Fund, into the Stable Value Common
Trust Fund. When the final contract matures in 2005, the Stable Value
Common Trust Fund will replace the Interest Income Fund.
>> Effective February 28, 2002, a final distribution was made of all
remaining dividends earned on the Employee Stock Account. Subsequent
dividends will be reinvested to purchase additional shares of stock.
>> Participants may immediately transfer their matching contributions and
Employee Stock Account into any of the other available funds at their
discretion.
>> The suspension period for unmatured and hardship withdrawals was reduced
to six months.
>> The distribution options were expanded to allow for monthly and quarterly
installments, for up to 10 years.
>> Participants will pay the loan initiation fee previously paid for by the
Company.
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Constellation Energy Group (EIN 52-0280210)
T.Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan
Schedule of Assets Held for Invesment Purposes
December 31, 2001
Current Maturity
Identity of Issue Description of Asset Cost Value* Date
----------------- -------------------- ---- ----- ----
Group Annuity Contract with Insurance Company Guaranteed
Allstate Life Interest Contract -
Company (GA-6240) Guaranteed Interest - 7.29% $3,461,341 $3,461,341 10/15/2004
Group Annuity Contract with Insurance Company Guaranteed
Bayerische Landesbnk Interest Contract -
Company (98-005) Guaranteed Interest - 5.95% 3,053,305 3,053,305 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
GE Life & Annuity Interest Contract -
(GS-2987) Guaranteed Interest - 7.25% 8,353,972 8,353,972 4/1/2002
Group Annuity Contract with Insurance Company Guaranteed
GE Life & Annuity Interest Contract -
(GS-3169) Guaranteed Interest - 5.79% 2,409,898 2,409,898 12/15/2002
Group Annuity Contract with Insurance Company Guaranteed
John Hancock Life Interest Contract -
(GAC-14474) Guaranteed Interest - 5.69% 4,708,804 4,708,804 8/15/2003
Group Annuity Contract with Insurance Company Guaranteed
Metropolitan Life Interest Contract -
(GAC-25037) Guaranteed Interest - 5.57% 3,512,485 3,512,485 10/15/2003
Group Annuity Contract with Insurance Company Guaranteed
Monumental Life Interest Contract - 50% 2/15/2003
(MDA00008FR) Guaranteed Interest - 5.71% 4,721,143 4,721,143 Balance 4/15/2003
Group Annuity Contract with Insurance Company Guaranteed
Monumental Life Interest Contract - 50% 4/15/2002
(BDA00729FR) Guaranteed Interest - 6.82% 4,710,249 4,710,249 Balance 6/14/2002
Group Annuity Contract with Insurance Company Guaranteed
New York Life Interest Contract -
(GA-31015) Guaranteed Interest - 6.78% 3,224,698 3,224,698 4/15/2004
Group Annuity Contract with Insurance Company Guaranteed
New York Life Interest Contract -
(GA-31015-002) Guaranteed Interest - 6.85% 2,910,210 2,910,210 9/15/2004
Group Annuity Contract with Insurance Company Guaranteed
New York Life Interest Contract -
(GA-31015-003) Guaranteed Interest - 6.97% 2,168,425 2,168,425 3/17/2005
(Continued on next page)
* Current Value of the guaranteed interest contracts equal contract value.
- 19 -
Constellation Energy Group (EIN 52-0280210)
T.Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan
Schedule of Assets Held for Invesment Purposes
December 31, 2001
Current Maturity
Identity of Issue Description of Asset Cost Value* Date
----------------- -------------------- ---- ----- ----
Group Annuity Contract with Insurance Company Guaranteed
Protective Life Interest Contract -
(GA-1348) Guaranteed Interest - 6.77% 3,198,228 3,198,228 1/15/2002
Group Annuity Contract with Insurance Company Guaranteed
Protective Life Interest Contract -
(GA-1391) Guaranteed Interest - 7.31% 4,172,695 4,172,695 4/15/2002
Group Annuity Contract with Insurance Company Guaranteed
Protective Life Interest Contract -
(GA-1662) Guaranteed Interest - 7.80% 2,006,183 2,006,183 12/15/2004
Group Annuity Contract with Insurance Company Guaranteed
Security Life Denver Interest Contract -
(FA-0494) Guaranteed Interest - 6.82% 3,464,488 3,464,488 2/14/2002
Group Annuity Contract with Insurance Company Guaranteed
Sun America Life Interest Contract -
(4873) Guaranteed Interest - 5.98% 2,336,400 2,336,400 1/15/2004
Group Annuity Contract with Insurance Company Guaranteed
Sun America Life Interest Contract -
(4930) Guaranteed Interest - 6.85% 2,909,682 2,909,682 6/15/2004
Group Annuity Contract with Synthetic Investment
Agreement
State Street Bank and Trust Interest Contract -
Company
(98255) Variable Interest - 5.711% 21,608,329 21,608,329 6/15/2004
Travelers Life Insurance Company Guaranteed
(GR-17825) Interest Contract -
Guaranteed Interest - 6.78% 5,349,566 5,349,566 9/20/2005
------------ ------------
$91,372,064 $91,372,064
(Continued on next page)
* Current Value of the guaranteed interest contracts equal contract value.
- 20 -
Constellation Energy Group (EIN 52-0280210)
T.Rowe Price, Trustee - Constellation Energy Group, Inc., Employee Savings Plan
Schedule of Assets Held for Invesment Purposes
December 31, 2001
Current Maturity
Identity of Issue Description of Asset Cost Value Date
----------------- -------------------- ---- ----- ----
** Constellation Energy Group, Inc. Common Stock - no par 277,080,709 285,815,104 -
T. Rowe Price Balanced Fund Mutual Fund 11,668,575 11,771,411 -
T. Rowe Price Equity Income Fund Mutual Fund 71,627,958 73,420,439 -
T. Rowe Price Equity Index 500 Fund Mutual Fund 30,284,871 27,058,236 -
T. Rowe Price Growth Stock Fund Mutual Fund 85,584,111 72,074,519 -
T. Rowe Price International Stock Mutual Fund 18,014,265 13,388,815 -
Fund
T. Rowe Price Mid-Cap Growth Fund Mutual Fund 28,529,749 29,768,588 -
T. Rowe Price New Horizons Fund Mutual Fund 21,183,757 18,067,143 -
T. Rowe Price New Income Fund Mutual Fund 4,537,384 4,546,536 -
T. Rowe Price Small Cap Value Fund Mutual Fund 26,603,140 29,999,730 -
** Loan Fund (Interest) Participant Loan Fund - 26,434,139 -
Interest Range 8.00 - 10.50%
T. Rowe Price Stable Value Common Money Market Mutual Fund 18,568,008 18,568,008 -
Trust Fund
T. Rowe Price Prime Reserve Fund Money Market Mutual Fund 12,696,514 12,696,514 -
T. Rowe Price Short Term Money Market Bank Account 3,104 3,104 -
Settlement Account
T. Rowe Price Short Term Money Market Bank Account 103,199 103,199 -
Distribution Account
------------ ------------
Total $697,857,408 $715,087,549
============ ============
** Parties-in-Interest
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