Text

Independent Spent Fuel Storage Installation, Nine Mile Point, Units 1 & 2, R. E. Ginna, Unit 1, Submittal of Supplemental Information in Support of Orders Approving Application Regarding Proposed Corporate Restructuring
	ML093000127
Person / Time
Site:	Calvert Cliffs, Nine Mile Point, Ginna
Issue date:	10/25/2009
From:	Barron H; Constellation Energy Nuclear Group
To:	; Document Control Desk, Office of Nuclear Reactor Regulation
References
	Download: ML093000127 (61)
	v • d • e

Henry B. Barron Constellation Energy Nuclear Group President, CEO & Chief Nuclear Officer 100 Constellation Way Suite 1800P Baltimore, MD 21202 0 Constellation Energy Nuclear Group 10 CFR 50.80 10 CFR 72.50 10 CFR 50.90 October 25, 2009 U.S. Nuclear Regulatory Commission Washington, DC 20555-0001 ATTENTION: Document Control Desk

SUBJECT:

Calvert Cliffs Nuclear Power Plant Unit Nos. I & 2; Docket Nos. 50-317 & 50-318 Calvert Cliffs Independent Spent Fuel Storage Installation Docket No. 72-8 Nine Mile Point Nuclear Station Unit Nos. I & 2; Docket Nos. 50-220 & 50-410 R. E. Ginna Nuclear Power Plant Docket No. 50-244

REFERENCES:

(a) Letter from Mr. M. J. Wallace (CEG) to Document Control Desk (NRC), dated January 22, 2009, "Application for an Order Approving License Transfers and Conforming License Amendment Request" (b) Letter from Mr. H. B. Barron (CEG) to Document Control Desk (NRC), dated April 8, 2009, "Supplemental Information in Support of Application for an Order Approving License Transfers and Conforming License Amendment Request" (c) Letter from H. B. Barron (CENG) to Document Control Desk (NRC), dated October 19, 2009, "Supplemental Information in Support of Orders Approving Application Regarding Proposed Corporate Restructuring" Supplemental Information in Support of Orders Approving Application Regarding Proposed Corporate Restructuring As discussed with the NRC Staff on October 23, 2009, Constellation Energy Nuclear Group, LLC (CENG) submits this letter describing its plan for completing approved corporate restructuring actions in advance of the final closing of EDF Development Inc.'s (EDF Development) acquisition of a 49.99%

interest in CENG, and explains how this closing process is in full compliance and consistent with the NRC Orders dated October 9, 2009 (Orders). We also describe the enhanced financial support mechanisms that Constellation Energy Group, Inc. (CEG)--CENG's ultimate parent--has implemented, including an increase of $45 million in the existing licensee support agreements, to provide additional assurance of financial qualifications during the interim period between now and the expected completion

,AD /

Document Control Desk October 25, 2009 Page 2 of the EDF transaction. As a result of this correspondence, we withdraw our October 19, 2009 letter, which is Reference (c).

Below we address each of the points upon which the Staff requested clarification during the October 23, 2009 meeting:

Justification for why the timing of the closing process complies with the Orders, including:

o Definition of the term "transaction" in the Conditions of the Orders o Constellation's redress plan in the unlikely event the EDF transaction does not close The additional financial support that is being provided that would cover any interim period prior to closing the EDF transaction Description of contemplated closing steps and timing, including those already completed

1. The Closing Process Complies with the Orders and Safety Evaluation In the Orders and accompanying Safety Evaluation, the NRC approved all license transfers that would result from the proposed corporate restructuring that would be implemented prior to EDF Development acquiring a 49.99% ownership interest in CENG. While a specific timeframe for the closing steps had not been detailed when we submitted Reference (a), we did note the sequential nature of those steps. Initially, we had anticipated that all closing steps could occur close in time, being nearly concurrent. Recently, however, we identified that due to the complexity of the closing of the transaction and tax efficiency considerations, certain of the corporate restructuring actions must be completed more than a week in advance of the closing of the overall EDF Development transaction.

This change in the timing of the closing process does not change the representations and agreements contained in the application as supplemented. Specifically, the corporate restructuring actions remain the same as those described in the April 8, 2009 supplement to the application (Reference (b)).

Fundamentally, the closing steps being taken reflect only a necessary evolution and progression of the transaction approved by and consistent with the Orders.

The term "transaction"in the Conditions of the Orders clearly refers to the EDF acquisition of 49.99%

of CENG, thus i) all restructuringactions leading up to the completion of the "transaction"are by definition bounded by and approved in the Orders, and ii) financial conditions of the Orders require new financial arrangements and assurances be effective only upon the closing of the EDF Development transaction.

Constellation believes that the restructuring steps described in our application and April 8 supplement, and as further detailed herein, are fully bounded by and consistent with the Orders and do not require any modification of the Orders or the Safety Evaluation. In particular, the conditions of the Orders relating to corporate governance apply to the "ownership and governance arrangements as a result of the proposed transaction." See Condition (3) of the Calvert Cliffs Order (emphasis supplied). In this context, the term "proposed transaction" quite clearly refers to the ultimate transaction with EDF Development, which will create the new CENG joint venture entity with the new governance arrangements. Moreover, there are no changes in the ultimate ownership or governance arrangements as a result of the restructuring, given CEG's ongoing ownership and control over the entities implicated in the restructuring. Consequently, all corporate restructuring activity required to reach the end-state of the ultimate transaction with EDF Development-including all of the steps set forth in Reference (b) and further detailed later in this letter and its attachments-are by necessity bounded by the NRC's approval of the "proposed transaction" with EDF Development.

Document Control Desk October 25, 2009 Page 3 Similarly, the conditions relating to financial qualifications apply to "financial arrangements resulting from the proposed transaction." The use of the term "resulting" makes it clear that these conditions concern financial arrangements that will become effective after completion of the proposed transaction with EDF Development, including the new Support Agreements provided by E.D.F. International, SA, the parent company of EDF Development, and CEG, the ultimate parent company of CENG. Accordingly, the financial conditions of the Orders require that the new financial arrangements resulting from the joint venture with EDF Development must be effective upon the closing of the EDF Development transaction.

The conditions do not require the new financial support arrangements from EDF to be in place as a prerequisite to completing the corporate restructuring steps that were identified by the Applicants and approved in the Order..

In addition, the paragraph in the Calvert Cliffs Order (page 7) approving the license amendment for Calvert Cliffs Nuclear Power Plant, LLC applies solely to the "direct license transfer" involving this entity. Conditions (1) and (2) of the Calvert Cliffs Order (addressing proof of nuclear insurance and the decommissioning funding mechanism) that apply to the direct license transfer relating to the corporate changes involving this entity have been completed. Thus, the new financial arrangements required post-closing of the EDF transaction, do not need to be in place in order for the conforming license amendment for Calvert Cliffs Nuclear Power Plant, LLC to be issued.

We emphasize that the goals and expectations of CENG and EDF Development are to complete the overall transaction approved in the Orders. Constellation's intermediate corporate restructuring actions are, however, necessary and approved parts of the larger overall transaction with EDF Development. To be clear, we are not in this letter requesting NRC approval of the corporate restructuring on an indefinite basis separate from the proposed transaction with EDF Development, nor are we proposing that the NRC now consider such a scenario as an alternative transaction.

Constellation would implement a redressplan in the event the EDF transactionfailed to closefor any reason.

Should the EDF Development transaction fail to close for any reason, Constellation immediately would notify the NRC and propose a redress plan to address any regulatory issues. We anticipate that the essential elements of any redress plan would include: (1) a commitment to indefinitely maintain all existing financial support agreements; (2) a commitment to submit new five-year projected income statements for the licensees without EDF Development ownership participation; and (3) a request for issuance of a modified Order approving the structure without EDF Development's participation. This information would be intended to demonstrate that the ongoing financial qualifications of the licensees remain adequate and support the issuance of a modified Order in the unlikely event the EDF Development transaction does not close.

2. Additional Financial Support Is Being Provided by Constellation Prior to Completion of the EDF Transaction CEG, the ultimate parent company of CENG, currently provides direct financial support arrangements to each of the licensees for the three nuclear stations. These arrangements are in place pursuant to commitments and NRC Orders in prior license transfer reviews. Specifically, CEG provides financial support through the deployment of (1) a cash pooling arrangement, as set forth in Master Demand Notes between CEG and each licensee subsidiary; and (2) Inter-Company Credit Agreements (ICA) solely between CEG and each of the licensee subsidiaries. At all times prior to the closing of the transaction

Document Control Desk October 25, 2009 Page 4 with EDF Development, the existing financial support arrangements will remain effective. Moreover, they will continue in force in the unlikely event that the EDF Development transaction failed to close.

EnhancedFinancialSupportAgreements Since the Orders have been issued, and in response to communications with NRC Staff, CEG has enhanced the financial support it provides under the existing support agreements. Specifically, CEG has modified the ICA for R.E. Ginna Nuclear Power Plant to increase the amount of funding available at any time from $60 million to $80 million; modified the ICA for Calvert Cliffs Nuclear Power Plant to increase the amount of funding available from $100 million to $105 million; and modified the ICA for Nine Mile Point Nuclear Station to increase the amount of funding available from $100 million to $120 million. These amounts are consistent with the 6-month outage cost estimates provided in Reference (a) and subsequent comments by the Staff related to the Ginna facility.

Although not required by the Order, CEG has taken the foregoing actions to provide further assurance of adequate financial support during the interim period before the consummation of the EDF Development transaction.- Copies of these financial instruments are being provided, as requested by the Staff during the October 23, 2009 meeting, as Attachment (1) to this letter.

It is important to note that these financial support agreements run directly from CEG, the ultimate parent company of CENG and the licensees, to each of the licensee subsidiaries. The agreements therefore are unaffected by any intermediate restructuring steps, including the formation of intermediate companies between CEG and the licensees. The new support agreements following the transaction with EDF Development will be as proposed in the application, as supplemented, and as reflected in Sections 4.1.5 and 4.1.6 of the SER accompanying the Orders.

Updated Net Income ProjectionsIndicate No MaterialAdverse Change As discussed with the Staff, Constellation has confirmed that there is no material adverse change in the financial qualifications of the licensees. In this regard, Constellation has updated (as of October 22, 2009) its projections of net income for the licensees through 2014. The results of the updated projections are enclosed in Attachment (2A) hereto.2 The updated projections include the effects of all power marketing arrangements including the power purchase agreements that will become effective after the closing of the EDF transaction (discussed below). Based on the updated projections, there is no material adverse change in the financial qualifications of the licensees.

We note that the largest changes in net income relate to Calvert Cliffs and Nine Mile Point, which anticipate selling much of their capacity and energy in the open market during most of this period, rather than through power purchase agreements, thus exposing these units and their financial projections to 1 The ICA for Calvert Cliffs Nuclear Power Plant, Inc. has been modified as well to apply explicitly to a successor legal entity (Calvert Cliffs Nuclear Power Plant, LLC (Calvert Cliffs, LLC)). In addition, CEG has executed a confirmation documenting that CEG will continue to provide all existing financial assurance mechanisms to Calvert Cliffs, LLC as the successor during any interim period prior to completion of the pending EDF Development transaction.

2 Attachment (2A) is provided in a proprietary separate attachment because it contains confidential commercial and financial information. We request that Attachment (2A) be withheld from public disclosure pursuant to 10 C.F.R. 9.17(a)(4) and 10 C.F.R. 2.390, as described in the affidavit of Henry B. Barron, which is provided in Attachment (4). A non-proprietary version of Attachment (2A) suitable for public disclosure is provided as Attachment (1) to this letter.

Document Control Desk October 25, 2009 Page 5 market price predictions and fluctuations. Ginna, on the other hand, has a longer-term power purchase agreement during most of this period with Rochester Gas & Electric for 90% of its output, and sells only a 10% slice of its capacity and energy into the wholesale ,market. Ginna's net income projections are therefore far less affected by nearer-term (through June 2014) market price predictions and fluctuations than the other units. Thus, the updated projections provided in Attachment (2A) continue to support the Staff's findings related to financial qualifications in Section 4.1.6 of the Safety Evaluation.

3. Description of Contemplated Closing Steps and Timing, Including Those Steps Already Completed As requested by the NRC, Constellation is providing additional information on the timing of the specific restructuring steps in the Table in Attachment (3), and as graphically depicted in Attachment (3A).

Attachment (3) presents no new or different restructuring actions or sequencing scheme, but simply adds a timing element and detailed explanations to the overall steps described in our April 8, 2009 supplement to the application (Reference (b)) involving the direct and indirect transfers. Attachment (3) provides a comprehensive breakdown of the specific steps and the timing, as well as information on the financial support arrangements that will be in place at each step. In addition, Attachment (3) provides references to the application, the Orders, and the Safety Evaluation Where these actions were described, reviewed and approved. Attachment (3A), which we had provided to Staff at our October 23 meeting, provides a pictorial representation of the steps discussed in Attachment (3).

As explained in this letter and in Reference (a), and as supplemented by Reference (b), and ultimately approved in the Orders, the applicants must undertake certain corporate restructuring to facilitate the proposed transaction with EDF Development. To date, the corporate restructuring detailed in steps 1 through 3 of Attachment (3) have been implemented. This implementation includes 1) the formation of a non-operational intermediate holding company, Constellation Nuclear, LLC, a wholly-owned and member-controlled subsidiary of CEG, that holds 100% of CEG's interest in Constellation Energy Nuclear Group, LLC, and CENG has elected to become a disregarded entity for income tax purposes; 2)

Constellation Nuclear Power Plants, Inc. conversion to Constellation Nuclear Power Plants, LLC, a disregarded flow-through entity for tax purposes, and by operation of law assumes all rights, obligations and liabilities of Constellation Nuclear Power Plants, Inc., and 3) formation of Calvert Cliffs Nuclear Power Plant, LLC-currently a shell company that holds no assets whatsoever. Step I involved a non-operational indirect license transfer, contemplated, reviewed and bounded by the Order.

Further corporate restructuring that, for tax efficiency purposes, must occur more than a week prior to the EDF Development transaction, includes Steps 4 through 7 described in Attachments (3) and (3A). Steps 4 and 7, respectively, involvea direct and indirect license transfer.

Step 4, where Calvert Cliffs Nuclear Power Plant, Inc. merges into Calvert Cliffs Nuclear Power Plant, LLC, is the direct license transfer referenced, reviewed and approved in the Calvert, Cliffs Order. It is Step 4 that caused CENG to request that the conforming license amendment approved in the Calvert Cliffs Order be issued as early as October 19, 2009. Step 7, also bounded by the Orders, involves an indirect license transfer and formation of a partnership at CENG. This partnership will be between a new, wholly-owned CEG company, CE Nuclear, LLC, and Constellation Nuclear, LLC. The partnership will thus result in CENG becoming a subsidiary of Constellation Nuclear, LLC and CE Nuclear, LLC, both of which are wholly-owned and controlled subsidiaries of CEG. As described in Reference (b), detailed in Attachment (3), and acknowledged in Section II of the Orders, the new intermediate parent companies between CEG and CENG, will not have any effective governance role over the licensees. Rather, these

Document Control Desk October 25, 2009 Page 6 non-operational entities will be either directly managed or controlled by CEG as their sole member and ultimate parent.

We believe that all of the restructuring steps described in Attachments (3) and (3A) needed to facilitate the proposed transfer of an interest in CENG to EDF Development are bounded by, and are in full compliance with, the Orders, and can be accomplished in advance of the closing on EDF Development's interest. These steps do not in any way implicate the financial and other conditions of the Orders, and thus the NRC's analysis and conclusions in the Safety Evaluation are not affected by the timing of the closing steps.

4. Additional Documentation Requested by the Staff During the meeting with the Staff on October 23, 2009, the Staff requested a copy of the draft form of the Amended and Restated Operating Agreement for CENG, which would become effective as of the date of closing the EDF transaction. A copy of the draft form of the Amended and Restated Operating Agreement is being provided for the Staff s information under separate cover. The planned amendments to the original form of the Operating Agreement relate to tax efficiencies and certain distributions such as tax distributions. These changes were anticipated earlier in the year, and notice of these planned amendments was provided to NRC in Reference (b), page 3. No material changes are being made to Article IV of the Operating Agreement, addressing support for the working capital funding arrangements for the licensee subsidiaries. In addition, the Operating Agreement is not being modified in any material respect with regard to the provisions concerning decision-making authority over "safety issues" as defined therein. In this regard, the draft amendments do not make any material changes to Section 7.3(c) of the Operating Agreement, relating to the casting vote authority of the Chairman of the Board of the new CENG. See Condition 3(a) of the Calvert Cliffs Order (Condition 1(a) of the Ginna and Nine Mile Point Orders). Upon completion of the transaction with EDF Development, CENG will submit to the NRC a copy of the final executed version of the Amended and Restated Operating Agreement for the new CENG joint venture.

The Staff also has inquired about new draft Power Purchase Agreements (PPAs) for CENG. These PPAs also are provided for the Staff's information under separate cover. The PPAs would go into effect after the closing of the transaction with EDF Development. The PPAs are consistent with the five year pro formna financial projections and are fully reflected in the updated net income projections discussed above.

The PPAs relate to the sale at market-based prices of the uncommitted output of power from the licensed facilities to entities that perform power marketing functions for CEG and EDF.

5. Conclusion The planned closing process described herein is in full compliance and consistent with the NRC Orders approving the license transfers, and is fully bounded by the Safety Evaluation. Constellation has implemented enhanced financial support arrangements so that the completion of the restructuring steps in advance of closing the EDF transaction will not challenge any financial qualifications of the Constellation organization and licensees. In the unlikely event the EDF transaction did not close for any reason, Constellation commits to notify the NRC immediately and to submit a redress plan to address any regulatory issues. Accordingly, Constellation believes that there is no need to update the Safety Evaluation at this time to address any alternative structure.

We note that the license amendment request and associated "no significant hazards consideration analysis" submitted' as Attachment (9) to Reference (a) remain valid, and no change in that analysis is necessary as

Document Control Desk October 25, 2009 Page 7 a result of the updated timing of the completion of the direct and indirect license transfers described herein.

We look forward to your response to this letter and respectfully ask that the NRC confirm its agreement with these clarifications as expeditiously as possible so that the conforming license amendment for Calvert Cliffs can be issued promptly following your consideration of this letter. We are prepared to work closely with the NRC staff to address any issues and expedite its consideration of this important matter.

We appreciate the NRC's assistance with this matter. Should you require any additional information regarding this correspondence, please contact Bruce Montgomery at 410-470-3777 or Bruce.S.Montgomery@constellation.com.

Sincerely, Henry B. Barron Chief Nuclear Officer Constellation Energy Nuclear Group, LLC

Document Control Desk October 25, 2009 Page 8 STATE OF MARYLAND

TO WIT:

CITY OF BALTIMORE I, Henry B. Barron, state that I am the Chief Nuclear Officer for Constellation Energy Nuclear Group, LLC, for Calvert Cliffs Nuclear Power Plant, Inc., Nine Mile Point Nuclear Station, LLC, and R. E.

Ginna Nuclear Power Plant, LLC, and that I am duly authorized to execute and file this submittal on behalf of these companies. To the best of my knowledge and belief, the statements contained in this document with respect to these companies are true and correct. To the extent that these statements are not based on my personal knowledge, they are based upon information provided by employees and/or consultants of the companies. Such information has been reviewed in accordance with company practice, and I believe it to be reliable.

Subscrib 9 d, and sworn before me, a Notary Public in and for the State of Maryland and City of Baltimore, this day of October, 2009.

WITNESS my Hand and Notarial Seal:

6x~ayPub lic~

My Commission Expires:

Date Attachments: (1): Existing Financial Support Documents (2): Updated Net Income Summary (non-proprietary)

(2A): Updated Net Income Summary (proprietary)

(3): Restructuring Step Table (3A): Restructuring Graphic Representation (4): Affidavit by H.B. Barron

Document Control Desk October 25, 2009 Page 9 cc: With Attachment 2A D. V. Pickett, NRC R. V. Guzman, NRC M. F. Weber, NMSS Without Attachment 2A S. J. Collins, NRC Resident Inspector, NRC (Calvert Cliffs)

Resident Inspector, NRC (Ginna)

Resident Inspector, NRC (Nine Mile Point)

S. Gray, Maryland DNR A. L. Peterson, NYSERDA P. Eddy, New York State Department of Public Service

Document Control Desk October 25, 2009 Page 10 bcc: With Attachment 2A H. B. Barron M. G. Korsnick C. W. Fleming, Esquire Without Attachment 2A D. F. Stenger, Esquire B. S. Montgomery S. L. Miller K. F. Robinson W. C. Byrne D. J. Bierbrauer J. A. Spina T. E. Trepanier J. S. Gaines / D. E. Lauver P. S. Furio B. J. Dough S. L. Belcher T.A. Lynch T. F. Syrell J. J. Dosa J. T. Carlin E. A. Larson T* L. Harding E.J. Groh E. M. Tyler CCNPP File 09.04 CCNPP Electronic Docket File NMP File NMP1L 2403 Fleet Licensing Letter 09-0013 NMPNS ACTIONS REQUIRED None CCNPP ACTIONS REQUIRED None GINNA ACTIONS REQUIRED None CORPORATE ACTIONS REQUIRED Action: Notify the NRC and submit redress plan if EDF deal fails Owner: Ned Tyler Due Date: Nov 30, 2009

ATTACHMENT (1)

EXISTING FINANCIAL SUPPORT DOCUMENTS Constellation Energy Nuclear Group, LLC October 25, 2009

MASTER DEMAND NOTE Dat"ed:: August 3D0, :2002 Eff ective :: Augus.,t 30U, :20.02 Each :of the undersigned (each a "Party".. coectively

.the "Parties"), .anticip,at:e entering ihito6 one or: more loans with each other from titme to time '.as either a, borrower or a lender.- Any such loans between, any of t he Parties 'will; be; governed: by' thi's Master Demand Note, and the grid attached hereto and made a part hereof (the.

'"Grid'):. At. 'any time 'that a Paratty :de:sires to: .lend money :to, or borrow money f:rom, another Party. :the Chief Financial Officer of Constellation Energy Group, Inc.. and hert staff is authorized to

,endorse. on, the Grid: %the.:date of ea~chý loan, the, principal amount thereof, the: interest rate and the identity of: the Party that iis: t.he, borrower: .and; the Party that, is. the. lender. :All notationsý on the Gr--id' shall be' binding on the Parties:, a'bs e nt 'manife:s~t error .:

Ford va:lue received,, each, Party that is...a borrower .:.p~romises. to pay to.: the order of eac'h Party that: is a lender the principal borrowed :as

.evidenced: on the Grid: in accordance with, the. terms hereof, together

.with accrued. interest on, any ýand. all principal amounts remaining!

unpaid hereunder from the date. of such loan until payment. in: full, at a rate per annum noted on:'the Grid until such principal amount shall have become. dueý and..payable; and at the rate; :of 2% over *the grid rate

on any%overdue. principal and (to, -the extent Jpermitted by applicable law) on. any overdue interest, from !the date on which, payment is, due until the obligation of the borrower with respect to the payment thereof shall .'be diScharged&. Interest. hereunder.. shall !be ýcalculated on tthe bas is. .of a three hundred sixty-five (3`65). day year ounting the actual nhiumber of days elapsed.

The borrower promises to pay the lender the outstanding principal amount :6f this Note .,together, with: all accrued but unpaid interest. in.

.one installment within 24, houis 6f. lenrder's. demand.. All: Of: the principal. may be prepaid by borrower- .at -any time:,, together with. all

'accrued interest thereon to, the date, o&f payment, Without penalty with five (5) days prior %written :noti.ce.

All principal :and interest hereunder are :payable ihn Iawful money of the. United :ýStates. of America at: the 'address o.f :the lender shown beneath it'- signature..

No delay or omission on the :part of the Lender: in exerci.sing any:

rights hereunder shall operate: as a waiver of such :right or any .other right of sucih lender, nor shall any delay,. omission or Iwaiver on any one occasion be deemed a bar to or wai.ver of the same or anly other, right on any.future ,Occasion.

ce\ ng ent: syste~mt for Subs\General Cash.:Management\Dernand Notes'&

Grid, \Current as of d83002\DEMANDl3CCNPP 083002Adoc: 08/30/02 11!:47 AM4

The borrower- for itself,. and ýits respectiVe legal 'representatives, successors ;and assigns, hereby expressly waives presentment:,, demand,:

protest, tice no. of protest, presentment. for the purpose. of accelerating :maturity and :diligence in :dollection.

This 'Note and all transactions hereunder and/or evidenced heriein sha*ll :beý governed, b-y1, construed, and enforced in accordance with the laws of the State of Maryland (without giving effect to its choice of law rules)Y and shall haVe the effect of a ,seal ed instrument.ý IN WITNESS* HEREOF, :the' :e'ach Party has, caused. this Note. to be

.executied by it's duly authorized officer, uder s.eal:, as of the date

.first above Written:.

,CONSTELLATION ENERGY GROUP,; :N.

By. ~ Lk~~

Name!; Thom"s E.e osz~inz,/ifr.

Title:

Treasurer Address:. 7t5.0 East- Patt Streedt

.1Bal'timore., MD: 21202 State: of Incorporationi:. Maryland CAL-VRT.:CLIFFS NUCLEAR POWER PLANT,! INC.:

i e: -- t-eph-en*A, 14rzann.

Title:

Tire~asurer Address: 1997 Annapolis Exchange, Parkway Annapolis.,, MD .21041 State .of: Incorporation: Maryl-and

INTER-COMPANY.CREDIT.AGREEMENT This Inter-Company.Credit Agreement (the "Agreement"), dated October 23,12009 ,eff*ecive.as of October 23,2009,:by and'between Constellation Eery GroupInc. (Parent) and its arnliateCalvert:Cliffs Nuclear Power Plant, Inc.("Nuclear").

RECITALS A. Nuclear Reguliatory'c0mmission ("1NgC")'tegul'ations require the licensee oflcal.vert Cliffs nuclear power. reactors (collectively, the "Facilities")to provide financial assurance of its .abilityiod protect public health andsafety,.

B. Nuclear parti cipates ini:cash a po Parent 'operates forithe benefit of all of its sub2idiaries.

The cash pooblis* :inended6to provide Nuclear. with:the cash necessary to meet.its dayo*-

However , if; day ch needsJficluding its obligation t6:protect public health and safety.

the cash pool, at any time, cannot meet those needs, then Parent has agoreed*'*:pfovid&

credit toNucleairbtoallow it to meet its 6bligationt6 :protect public healih"and safety',

The parties, for, adequate lonsideratIion':and intending to be legally hereby agree as follows-:

itbound,.

ARTICLE. I THE ADVAWNCES Sectiin I.01. Advances., Durinfg the period from the:date.of this Agreemfint.to'and includingthle'Maturity Date (as defined ifinSec*ion 1.03),.Parentagries, on the terms and, conditions:setffith 'heieini. from tiine-to.

timie,to extend .credit t6 :Nuclear;, provided,,, however, that the aggrcgate principal amount of alladvances outstanding atany timcshall fnot exceed $105' illion. Dui-hg the teirmnof this Agreerienif:' Noclear,.at' its option and withoutfpenalty oripreemium,.may from' timic to time repay. all or any part of theeprincipal amount otitstandinig as provided:iiii':Sectioný 1.06, andmaiy:reborrow any amount that has been repaid. Each advance of fliinds under this Agreement shall be in amini mium amiount of $5 million and, if greater,;shaIll be in an, integral multiple of SIlmillion, Section 1.02. Request for an Advancc. Each 'equest-for an advance of funds under this:Agreement shall be made not later tfah noon on thesecond btusiness day prior totheproposed drwdo-wn d by notice' fbm SNuclear to Parent (pursuant :to priocedUres~that m~ay be cehanged: from time to time by mutual, agreement):

specifying, the amount.of theaddvance and!a:.cettification'that such advance:is:for the purpose-specified in Section L.07T.,

Section 1.03. The.Note. At thetitmelof the first advance, Nuclear will execute a:note inisubstantially :the form attached hereto0as Ekhibit B-2.I1i(the"Not") and deliver to Parent. Any advance provided by

Parent to Nuclear, and: any payments ofprincipaland interest by Nuclear, shall be'noted by.Parent on'the

'grid attached toethe Note. Such notations shall be conclusive, absent manifest error. TheNote is payable to the order of Parent at. its principal office, in*Baltimore, Marylandand matures on the Maiurity Date (subject to the terms of Article 11: hereof). The "Maturity Date" shall mean: (i) the 5th year arnniversary,.date of the odate of this Agreement; (ii); such,earlierltermination date as may :occur pursuant to Sections,2,01, or;'202,:or:

2.03; (iii) such later date ýa:may~be mutually agreed by the partiesýhereto pursuant to Section 1.09; Or (iv):at thedate.ofclosingon. any, transacti.on: in. which:: (a) the assets.(except asset:sales in the ordinary course of

.business) or stock of N uclear are, sold'.to.: an:unrelated third party,,of. Parent, or (b) Nuclear :is merged or consolidated 'into'anunrelated thirdj party of Parent whether by operationwof law or otherwise. If the, Maturity Date, is not'a'business dayiniBaltimore,Maryland, th enext succeeding business day shall be

'deemedto. be the Maturity Date.

ýSection 1.04. Interest. Intrest on any principal amountoutstandingshall accrueldaJi at such rate, and

,shall ,be payable at such :times, as established by Parent at the time: of an:advance. The interest:lrate:

applicable to any-advance and the time of payment shalL be noted on the:griidattached to the Note by Parent. Such.notations shall be conclusive absent manifest error.

Section 11.055. Funding and Repayment. 'Each.adVancegof funds under this Agreemenitshall* fbemadein.

UJ...:)ollars in immediately availablefunds on eacU drawdowndate, at such pl*ae as Patcn t and NucIear may agree. A.l repayments and prepayments-by Niiclear of principal and ihterest., and 6fal 6therr-sums due under the.Note or this.Agreement shall be made without deduction, setoff, abatement, suspension, deferment, defense or counterclaim,:on or before-the due date of-repayment or payment, and shall be made in U.S;dollars in immediately avaiable funds atthe principal:* officeq of Parent.

Section L06K Optional Prepayments. Nuclear, at its: option,- may prepay all or-ny"pat ofihoe principal amount outstanding from time:to0 ime without~penalty or primiui-, uponlat ieast 22businessldays' prior notice (Which, if oral, shall be confirmed promptly in writing) to Parent; pro.vided however,.'that if the in*erest'rate is LIBOR based, apropayment penalty may be assessed a-ain st N clear. Any prepayment penaltywould be established atihc timh e of an advance. Parent, at its option, may waive such notice requirements as io an pripayment..

Section 1.07. Useof Pmoceeds. In order to providecfiancial assurnce, anyadvance may be:used by Nuclear onlyto: mee its expenses arid obligations tos,*afely Iberate and maiiintaifi.the Facilities, including, payMents for*: uclear property damage insurance and: areirospective premium puirsuannt to Title 10,.

Part 140, Se'ctio'n:21 of the Code of Federal RegilAtionsi(.10 .GFR 140.21).

Section 1608. Cominitment Fee.,: Atthe timre'ofany advance;-Parent:will notif' Nuclear of any commitment fee' and the method and time:of payment. Such commitmentt fee will onily-be iiian amount necessary to offse'tParentd's-opcrating expensesz regarding the advance.

Seetion 1.09.: ExtensionwofMaturity'Date. This.Agreementand the Maturity Date heretifidermay'be th:mriutual agreemient of the parties.

extefided, for sut ceks ive periods of two years"each upon .1 ARTICLE fI TERMINATION:

Section 2.0*1. Termination upon-: Un'einforeeability. Parent,,at::,its:ioptioni' 'shiall have the right to cease:

makingi advancesunder this Agreement, t6 terminatewthis Agreement and/or toand make the: ou0t.standing priicipal amoin'tand.intefestvthereon and any-other sums duei tider the:Note this Agi:dement immediately due and payable upon written or oral:notice to Nuclear, but withoutthefrequirement of any further or other notice, demand or presentment of-the:Notc for payment, if this Agreement or the Note sliall W for any ,reIacsn :ease :to be in full forceand. effect or shall: be null and void while the Note is

.at-any time 6utstandifig, or the Validit*y:or ehforceability of-this Agreemientvbr theNote shall becontested by any person; or Nu*learshMall deny that it hAsany furtherliability or obligation under this Agreement or the Note,.

iSection-1202.. Termination Upon Permanent: Cessation f Operations or NRC Approval.

Notwithstainding.any other provisions in this Agreement or theNote to:the::contrary, except as provided in Sections 2.0L and 2.03,here in,. Parent agrees:that it will providethe credit!t6o:Nuclear for the purposes

.07, andinno event shall this *Agreement be terminated: nor,shall Parent-cease to make

inSection Ldefined

-advances underthis Agreementuntilthezaglierof: ,(i)*such time that Nucilear has.permanently ceased

operations at theFacilities;.or (i'i) the NRC.hasgiven written approval for the discontinuance or termination ofthis Agreement; or iii) uponthe date'WfclIsing on any transaction, in which (a) the assets,(except asset sales:in the ordinary course of business) or stock, o.uelear are sold to an unrelated thirl party of4Parent, or.

(b) Nuclear is merged or conso0idated into-an unrelated-third party ofPa~rent whether by operation of law or

,otherwise.

Section 2.03. Substitution of FinancialAssurance. Parent can: terminate this-Agreement upon 45 days written notice to.Nuclear if Parenthas procured a,substitute loan facility and/or-letter of credit for Nuclear that meets tihefinancial:assurance requirements of thc.NRC to:protect the public-healthand-safety. Such 2

substitute Win Nacilitwvandr ,letier.ft, credit shall remain i effeCt uii I the earl ier ofl:i)such time that Nuclear has pcfmianentlv ceasMd" peratirins;tgt the FaciI i tiies- (iiythf.Ne, NRC. has given wrlitlel approv'l101, and~or.letter.

disconfinuanice~or ternminiation of , lie substitute ...loan.facjjtLvIpe an4rltr fr -o (ii0.iif.

o~fc+rditi*.or ii hlas.

Parenttln procured anoither.Substi tue l0:oan f7'cility:andior let le.-o.credit flor.* j I sil.ijiaice N 6clea r'tiait neets (tie:fi hin.iu re~uireii~{i& ifihWNR:C :topi ?Otee the public healt and .afety.

MilSCEI .LýANf, 2A S:

Section;3.01. Notiecs. Anyomiunicalions betWeen the partiesO itT.r and 'noti*ce prov ided herei to be itveni"lay*be:given by:niaitii gorf thcrwise "ydehyvrinod gd ehs niotli.resuier1 61 Pa'rent Treasurer ofNuiclearat theprincipal oftime. of-Parentand Nutlear, respectively,0o7 to su hcr officers or. iddressesas either pirty tmay in writii hereatler speci ,,.

Section 3.02. Remcdies& No delayor,omission to exercise ny riglht.rpowv&or remedyaccruing to Parent under this Agroement shalltinmpair'any such right power or remedy, nbr:shall il be construed to bc a waiver (f.anystich right. powerorreinedy.. Anywaivcr, pcrnit consenl or-approvalof any kind Prcliaractcr:tn, thepart ofParent ofany breach or default undcr.ti'i Agreementmust be in~writingand %W) beffli only to the extentIs pecifically:set Iorih insiceh witinL All rem6ed i'&%,either utnderthisAgre entorby laýw or0otherWise affotded to Parent, shall be cumunld*,'v aind not altcrnai ve..

Section,3.3. miscella,,.ous. ThisAgreement may notbe Ia ended.tulessin..wYriiiingsigned byboth.

patii.q TisT*'*orcement is govermed by ;%trylandlaw. Tihis Agreement may not bcassigned by eithmer party without theLprior.wmiciPcii* on. *ifhe nt otlhepar.y.

IN WIlTNESS.WI tIEREOF,.the parties itrto have executed thisAgreetent *by their duly autiaoriz,*d office.rs, as ofihe date first above, *viilltct CONSTE AFON ENFRG Y:GROUP, INC.

.Namte: R~ses k. .fceurnan Title- Vice Pfesident, C!iie.Agcotintiiitaficr i iid.Treasurer:

CALVERT-CLIFFS'NUCLEAR:POWER PLAN.T,.INC.

Namie: teplena nanei T'itle:- VPbf.Financial-Services and Treatsurer 3

ATTACHMENT ,

FORM OF INTER-COMPANY CREDIT NOTE I$M05 millioni (AVailable Credit) ,2009 Baltimore, Maryland Calvert*Cliffs Nuilear Power. Plant, Ic.,a ztDelaware limited liibiiity company ("Nuclear"),* for value.received and in conSideration of the executionand delivery by Constellation Energy Group, Inc., a Marland corporation ("Parent") of that certain Inter-Company Crcdit; Agreement, effective as of [ I (the "'Agrecment'r),

hereby promisestoq pay to the order of Parent:on the.Maturity Date, thc principal sum of

[$105 milion], or'somuch thereof 6' may: be outstanding hereunder, together with any accrued'but unpaid interest. Priorjto maturity, inerest.-shall be due and payable'by Nuclear periodically as noted byParieit at thei time o-f a advance and as set forth on the grid attached hereto and made a part hereof.

This Note is issued by Nuclear pursuant to, the Agrccment, to which refere'nce i'ss made for :certain terms and conditionis appliicable'.heret6 'Capitalized: terms used in'this Note shall, Unless the coniext otherwise requires, have he samemeanings

assigned to them in the Agreement.

Both the principal of this Note and interest hereon are payable in lawful money, 6fthe Untied States of erica, whichiwil beirimmediately'available on the day when-payment shall becomedue,at ithe principal office of Parent. Interest-shall be paid

,on ov erdue pirncipal hereofand to the extent !egally entforceable, ohoverdue inteiest,.at a rateof I% overl hethen current prime lending, rate per annum.

The outstanding principal aoun of this Note :shabe increased or decreased upon any-increase or decrease in:the outstanding aggregateptrincipal amount as provided under the tcrmsof Sections 1.02 and 1.06 of the Agreementi provided, however,

'thatattno time shallfthe outstanding principal amouritof this Noteexceed the Available this Note,,Parent

,Credit. Upon any such increase or decrease in the~principal amount:of shall cause to be.shownupon the gridiportiortnof this Note the date and amountof such inctease or decrease, as the caselmay be. All notations:by Parent on the grid, shall, be conclusive absent manifest error U.p.on payment in full of the principal of and interest on this Note and all other sums due from Nuclear to Parent under theurtems of this Note and'the Agreement at the.Maturity Date, this Note shall be:cahceled and returned to Nuclear and shall be'of no further:operafion: or efflect. The0obligation of.Nuclearto make the payments required to be:made on this Note*and unider the Agreement and to perform and observe theother

ýagreements onf its part contained herein and therein shall be absolute and unconditional

and shallnot besujbject to diminution, by setoff,. counterclaim, abatement or othekwise.

4:

Upon the:occurrence of an event givfingrise to qaright on the part.of Parent.

to terminiate thce Agr'ernnt, as set :*forth.in settions 2.01i, 21.02, and:2.03 ofthe Agreement,.

tfie maturity 0ofthis Note may be accelerated and the principal of and interest,on .and-any other sumS duefrom :Nuclcarfto Parent under the terms'of this Note may be declared immediately. due.and:payable as provided for in. the Agreement.

'This Note.iss issued with the. inentethai it-shall bee govermed .by,. and, 9on.stfed in acocordAnce .ith, the laws of theStdati0of Marvlaid.

IN WIT-ESS WHEREOF, Caivert:CliffsNuclear Power Plant, Inc., has caused this Note to beLduly executed:in its' nae, :andits cororate seal tobe hereunto affiked and attested, by its duly authorized officer as of , 2009.

Calvert CliffsNuciear Power Plant, Inc.

gBy:

5

CONTINUING FINANCIAL ASSURANCE FOR THE CALVERT CLIFFS NUCLEAR POWER PLANT As duly appointed officers and authorized: representatives:. of:Constellation Energy Group, Inc., Calvert Cliffs Nuclear Power Plant, Inc.,,and its successor entity, Calvert Cliffs Nuclear PowerPlant, LLC, we have full, knowledge of this pendingtransaction and associatedjNRC license transfer. Order, dated October 9, 2009. and hereby provide this confirming representation with respect to the continu'tibn of the presently dep loed financial assurance mechanisms for Calvert Cliffs Nuclear Power Plant, LLC, as the successor 1egal entity to CalvertClIiffs Nuclear Power Plant, Inc.

As filed and described in our: original license applic ation to the U.S. Nuclear Regulatory 'Commission (NRC) on January.22. 2009, and as supplemented onAptil8,.'2009;,the transactin includesa structure in.which Calvert.Cliffs Nuclear PoWer Plant Inc., will effectively mergeinto Calvert Cliffs Nuclear Power Plant, LLC. Asa: result of this step,:the latter entity, Calvert;Cliffs Nuclear Power Plant, LLC, will be the legal entity survivor of this merger and the named facility licensee.

Presently, Constellation EnergyGroup, Inc. (CEG) provides specific financial assurance measures:to Calvert Cliffs Nuclear PoWer Plant, Inc. through the deployment of a cash pooling arrangement, as set forth in a Master Demand Note executed onri August 30, 2002) aswell as an inter-company credit agreement, executed ion June 26;, 2000. The form. and structure of these financial assurance agreements were filed with the NRC, as part of the original license transfer effortsin. 2000.

Accordingly, CEG will continue1to provide these specific financial assurance measuresin thepreviously specified amounts, tothe surviving legal entity Calvert: CliffsýNuclear Power Plant, LLC. Therewill be no disruptionmin these existing CEG financial assurance mechanisms, during any interim period prior to completion of .the pending.EDF transaction. :In theoalternative, should the transactionfail to, consummate, the measures will continue as expected for Calvert Cliffs Nuclear:Power Plant, LLC.

During:any interim periodpriortothe EDF transaction closing,:Calvert:Ciiffs'Nucleir Power PlaritilL will continue to haveo'full access to both of these financial assurance measures- consistent with the.

terms and conditions specified in :these:agreements.

As specified in ourlicense transfer application, as supplemented, and the NRC's Order dated October 9, 2009, upon completionof:'the iEDF transaction, similar financial assurance measures will be deployed, including both a Constellation Energy Nuclear Group, LLC.:cash pooling arrangement through::the use:of new Master Demand Notes, as well as new intercompany credit agreemennts executed by both EDFF a n d CEG to.Calvert Cliffs Nuclear Power Plant, LLC. These agreements will provide the necessaryfinancial assurance mechan Ism'sfollowing consummation ofthe EDF transaction.

Signhedli Date: Octber 21,. 2009 StephenmA.Mormann Lowry je/64stan Erea.

Vice President Financial Services & Treasurer Aisant Trealsurer, Constellation Energy: Gro~up, ,Inc.,

Calvert Cliffs Nuclear' Power:Plant Ihnc CCaivert.Cliffs Nu-clear Power Planti-, LLC.

Page2 of2

MASTER DEMAND-NOTE Datted.:' August 3:0, 2002 Effective: August, 30, 20Q02 Each 'cif the: undersignrvedl (each a ..

arty", colledtive&ly thhe "Parties") anticipate entering into. onel or more .loans with.each o ther from time' :tob ti1me as either a borrower or a lendetr;. Any such: loans

between any of the Parties will be 'gOverned. by- this Master Demand Note, and the grid attached hereto and made a. art hereof (the "Grid"). At any time that. a Party. :desires to lend :money *o, or: borrow money from, another Party the., Chief. Financial Officer of Constellation 'Energy Group,. in*c*. and her staff is- aut horized to endorse on the.' Grid -the date of each, ýloan, the,. prinipa amount thereof, the interest rate 'and the :identity' of :the. Party that is- the borrower: and. the 'Party that is the lender. All notation's on the Grid shall be binding on the Parties, absent manifest error.

For value received, each 'Party: that is a borrower promises to pay

to, the order of. each Party t issat.a. lender the principal borrowed as

.evidenced on. the Grid: in :accordance with. the< terms "hereof, together with ,accrued, interest: on. ýany :and all principal amounts remaining6 unpaid hereunder from t~he dat'e: of such loan. until payment. in, full, at

'a rate per annum noted on ',the Grid until such. principal. amount, shall

,have becomie due and payable; and at theý rate of 20 over :the grid rate on any overdue principal and (..to(. the extent permitted by applicable law) on any overdue interest, ýfromt: the date on which payment is due, unt-il the obligation of the borrower with respect to 'the payent thereof shall be discharged. Interest hereunder shall be ca* culated

on the basibs', of a three hundred sixty-fie: (3651) day year .qcunting theý

-actual number of days elapsed.

The borrower promises to pay the lender the 'outbstandi ng principal.1

.amount: of this No~te together with accrued but, unpaid interest in

al one installment within 24 hours2.777778e-4 days 0.00667 hours 3.968254e-5 weeks 9.132e-6 months of lender's demahd . All, of :the

.principal may be prepaid' by borrower. a t. any time::, together with allI accrued ihterest: .thereon to the date 'of 'paymeht, withoutr. penalty with,

five (5), days prior written notice,.

All principal and interest hereunder .are payable in lawful money of the, United ýStates of America :at. the address: of the lender shown beneath its 'siqgnatu-rre No de:lay .or omission on the- part of the, Lender in exercising: any rights, hereunder 6shal operate as a waiver of such right' or. any other rii ht of such .Iender,, nor shall any delayi, omssion or, waiver on any one occasion be :deemed. a ba. 'to or waive of the same, or any other right on: any future occasion.

S:\pidance\BGE\PINSSVCS\Cash management .systemt for Subs\General Cash Mandgement\Demand Notes &

Grids\Current an of 083002\=4MA NNP .0",831002.doc 08/30/02 A 3*.1:5S2 ..

The borrower for itself and its respec.tive legal representatives, suiccessors and assigns, hereby expreslyi waives presentment.,. demand, notice of protest, presentment: fori -t-he purpose: of

protest, accelerating maturity and: diligence ih collection.

This.:: Nobe: and all. :transactions hereuhder and/or evidenced, herein shall 1be gover ed by, construed, and enforced -in. accordance with the la.Ws of the State: of .Mary.land (without- givinig .effect to its, choice, oof

,law rules) and shall have ,the effect of a sealea instrument.:.

IN WITNESS WHEREOF, the each. Party has. caused this .Not.e to :be,

xekuted: by its duly authorized offiier, under seal, a: of the date

.first above written.

CONSTLLATION :ENERGY GROUP, INC.

By: / ' 1 L'~- A~

Name: Thomas,.. zinJ,,/ r-.,

Title:

Treasurer,. .

Address:; 7-50 Eas.,t. 'Pr;att, Street

.Baltimorre, MD 2,1202, State of Incorporation: Maryland NINE MILE POINT NUCLEAR STATION, LLC Name: A.te~en; Mormahnn

Title:

Treasurer AddresisqI: 1.997 Annapolis Exchange Parkway' Annapolis, ýM 210.4l State. of Incorporation: Delaware

INTER-COMPANY CREDIT AGREEMENT This lInter-*Company Credit Agreement (the "kAgreement'), dated October 23, 2009, effective as of oCtober 23, 20.09 by and*betwcenzwon* stellaion Energy :Gr*up, Inc. (Parent)eand its afiliate, Nine Mie Point Nuclear Station, LLC(NMPFLC).

RECITTALS A. N ucleari::Regtiatirt- ,Cdomm ission ("NRC") regulations' req`uire the licensee of Nine Mile Point: ncleari powerreact os (collectively, the "Facilities") to provide financial: assurance of itsability to protect, pblic6health and safety.

B.. NMP LLC participatesiin a:cash pool Parent operates:for thebenefitof all ofits subsidiaries, Th6 cash poo1 is intend&ddto provide NM1'LLC with the .cash ne*esiary to meet its day-to-day cash nieeds, including its obligation to protect public health and

. safety. However, .if thel ciashPOo61, atlaniyfi me, :canno6tmeet thoscnieeds, then Parcnt has.

agrced-t0provide cdedlit: to0NMP LLC to ýallow it to meet it's obligation to :protect public health and safety.:

The parties, for adequate consideration and intending to bedlegaily bound, hereby, agreelas follows:

ARTICLE.I THE ADVANCES Section 1.01. Advances. During-the period from the date. of this: AgreementhVto:and including the Maturity Date (as. defined in Section -1.03), Parent~agrees, on the-terms*and conditions setforth herein, from time-to:

time, to extend creditrto NMP LLC; provided hobwever, that the aggregate principal amount of all advainces

outstianding atany .time shalli not exceed $120 million .During the, termtof-this Agreement, NMP'LLC,:at its option and without penalty or premium, may from time to0time repay all:or: any part of the principal amount outstanding as provided in Section 1.06, and may reborrow any-amount that has been repaid. Each advance of fun.dsu,.tinder this Agreement .shall be in a minimum amount of $5 :million and, if greater, shall be in an integral multiple of$ .million.

Section 1.02". Request for:an Advance. Ehch:reqUeSt.fort ahn,.adv.anct of fufids underlthis Agreement shall be mad:enot'laterithan noon on the second business day prior to the proposed drawdown by noticefrom NMP LLC:to Parent (pursuantjto procedures: that may :be changed frpm time t-.time by mutual-agrcement) specifying'the amount of the advance and acertification that such.:advanceis for the-purpose.:specified in Section ,.07.

Section 1.03., The Note. At the time of-the first advance, NMPRLLC will execute a note insubstantially the form attached hereto as Exhibit BI2. I (the "Note") and:deliver it to Parent., -Any advance provided by Parent toPNMP:LLC, and any payments of principal and interest by NMP, LLC, shall be noted by Parent on the grid attached to the Note. Such notations. shall be conclusive absent manifest error. The Note is payable to the order of Parent at its, principal office in Baltimore, Maryland, and: matures on theMaturity Date (subject~to the:tenns of Article Ii hereof). The "Maturity Date" shall mean: (i) the 5thyear anniversary date. of the:date of this Agreemeni;: (ii) such earlier termination dtie:as may occur:pursuant.to

Seciions.2.01:, or*2.02, or2*.03;:(iii) such'iatcr date as may:be mutually agreed ~by the parties:heretbopursuant

'to Section 1.,09; or (iV)at the date.of closing-on any transaction in which: (a) the-assets (except asset-sales in,,the.ordinary course of business) or stiockof:NMPLLC are sold to an unrelated third party of Parent, or (b) NMP LLC is merged or consolidated into an unrelated third party of Parent whether by operation of law or otherwise. If the Maturity Date is not a business day in Baltimore, Ma'land, the next succeeding business day shall' be deemed to be the Maturity Date.

Section 1.04., Interest. Interest on any principal amount outstanding shall accrue daily at such rate, and shall be payable atfsuch tiihds%as cstablished'by, Parentat the time orfan advaince. The intcrcgtorate

applicable~to anzy :advance and the time. of.payment shall be noted onthe agrid attached to ihe Note by Parent. :Suchfintations shall be- conclusive absent manifest:error.

Scetion 1.05. Funding and *Repayment. Each advance of funds under this Agree ment shall' be-made iný U:S, Dollars in iinmediately:availablefunds on .each drawdown date,,at such:p*ace asPiarcnt and:NMP. LLC Pmay agree. AI!repayments and prepayments bY NM1I LLC of principal and interest, and of all 6ther SUms duetunder the Note or this Agreemeni shall be made without deduction, c stoff,:abatement, suspension, deferment,:defense or counterclaim, on orb.efore the, due date of repayment or payment;and shall.be made

.ýin U.S.ýdoilars in:immediately availabletfunds.atthe principal otFice of Parent.

S:,Section::-1.06. Optional Prepayments. NMP LLC, at its,5opot Iion',. may prepay all or any part of the principal amount outstanding from time to time without penalty rpeim pna es busns daspro

,noticeý(which,if oral, shall be confirmed promptly in. writingS to Paren.t; .rovidedi, howcver, that if the interest rateis-LIBOR based, a.prepayment penalty may be assessed against NMP LLC., Any pfeiayment penalty would:be established at th:'e time'ofan*,advance.i Parent,atitso*ption, may waive such notice, requirements:as: to: any: prepayment:

Section 1.07. Use of Proceeds. in order to provide .financi.al assurance,; any. advance may be used by NMIP LLConly to meet itscxpenses andobligations to safely operate and maintain: the. Facilities, including paymenisý for nuclear propety damage insuraince~and a retrisoective~prehiun toTitle 1pursuant 0,

Fart 1406 ,,SectIio ,n:21of the Code;of, FtedA.c Iatioi.n.s (10 CFR -140.21).

Iral . .Regul.

Section-L .08. Commitment*Fe. :At the time of any advance,:Parcrmt willhotify NMP LLC of any commitment fee and the mothod.and tiine'.of paymedt.. Sutch o6mmitment fee 'willonly be ibman: amount:

necessary to offset. Parent 's operating expenses regairdifg the advance.,

Section.1.09. Extension of Maturity Date. This Agr'e ment and the Maturity Datehereeundermay be extended for succesive period of two years each-upkn'th.eutual agreement of t heparties.

ARTICLE 11 TERMINATION

Sectionl2.0. Termination upon Uneniforecability. Parent, at its:option-, shall havethfie right to:cease making advanices under this Ag~reem-ent, to- termin-ate- thisAgreemtent and/or to make thc, ouitstanding principalamount aid interest thereon and any othe* sumsdtuelundre the Note and this Agreement

,immediately due and payable upon written or oral notice to NMP LLC, but.without the requirement of any further or other notice, demlandor presentment of the Note for payment, if.tis Agreement or the Note shall at, any time0or any reason cease to bepin full force aind effector'shall be null and:void while the Note is outstanding, or tl*e;validity or enforceability of this Agreem&entor the *Note shall be contested by. any personor:"NMPýLLC:'shallidenyý:that; ithaslany: further.. liability or 6bligationwunder this'Agreement or the Note.,

Section"2.02. Terminiitioi Upo*ni Permainent Cessation of Operations or NRC Approval.

Notwithstanding aray other provisionsnin this' Agreement or the Notejto the contrary, except. as provided in Sections: .01 an*d'2. 03' herein, Parent agrees that it wi IIprovide tihe credit -to NMP:LLC for the purposes, defined:in:SectionhJ07,j and inno event:shall this Agreement'be terminated, nor shall Parent ceaseto make advances uniderthis Agreement,, unti the earlierof: i).such'time that NMP LLC has :permanently ceased

operations at the Facilities; or'(ii) the NRC has givenv.written :approval for the discont*inuance-or termination:

of this Ag&fei6hnt; 6r (iii) upo6n'the.'date of: losing.on any transaction in which (a):the assets (except asset, salesin'the .ordinarycourse ofdoo siness)o:br~stock:ofNMP ILCare'sold to:an unreiated:third partyof Parent, or.(b) NMP LLCCis merged or consoiidatediinto an unrelated third party of Parentwiwhether by operati6ni6f law or otheridse.

Section 2.03. Substitution of Financial Assurance. Parent can terminate this Agreement upon 45 days

written nioticetojNMP LLC if Parent has procured a substitute loan facility and/orletter of credit for NMP LLC that:1meetsthefinanciu asU ran ce.rcquitements f t!ecN RC- to pec the publ ic bheaith and safety.

2

Such subsiitute:ioan faciiity and/or letter ofcredit shablremaininieffcct'until tiesearlier.of (i)suich tiiMtliat N~MP LL~as pe.rmanent ly ceased ioperations a:t~he.Facilitis;.( ,ji) thc.NkC.Chas~giveh written approval of the discontinuance6oreriterinationi ol'ihe substIitutc 1loanm fici ijy and/or let eroorcreditv. or(iii) ifParent has, procured another suibstitutc: loani facility*and&or letcr of.eredit 6OrNMPP.:L,LG* ihat inepis thie financial ass~urance requiretnents otthe'NRC to protect the ptfilic.ýhalth ahnd safety.

ARTICLE Ill MICELLANEOUS.

Section 3:01. Notices. Any commutnications between:the parties hereto, and notke provided herein to be

.given; may be~given by mailing or otherwise by delivering the same-to the Treasurer of Parent and the T7reasurer ofNMP LLC, at-the princillal'ofliccs of Parent and' N'M."?LLC; respectively, or to such othe'r officers or addresses: as either party riay:in writing hereafer speciý:.

Sectioin302. Remedies. No dclay: orpin issionto exercise anyriHot, ýpowr or remedy accruing td Parent

-under thisAgreeintý ithilI impair anyfsuth.righi, power orreamiedy, nor.shlall..i be coinstrued torbe a4waiver of any such right. powverqrcrem*dy. :;aMy waiters, permit, consent or approv,al of any kind or character on thepart of Parento.brle.atch or default undcr:thisAgreemnenE, inust be in writing and shal be .effective on.y to the extent spec.ifically set forth in'such:writiing., All rniicdiesi either under this Aýgtfeenh* t or by-

`iw or otherwise aff`rded to Parent, shall becunulativeand`;not alterative.

Secti.on3.03. :Miscellaneous. This Agrecmeon*f ml*i'm .nti be amended unilessinw-.riting signed'by both parties. ThliisAgreemient is gowihed by "MafrylandIlawv. This-Agreement may notbe assigned.byeither party Without thepriOrý.writtcn consent ofte othief.pa,.v.

IN WITNESS&WHER 1OF',the pOaries heretohave exCcuted thisAgreement. by their duly. authorized offlicersMis ofthe date fiirst above written.

'CONSTELLATION ENERGY G3ROUP,NINC.

By,

ýNanie: ReCSe K. F66eurohi1*'..

Tide: PresidentiChii'cl Accoumnin*Oflicer. and Treasurer iV.i'ce NINEMILE.,OINT NUCLEAR STATION L11C B3Y:

Name:1 Stephen A., Mormann,

Title:

VP. of FihiicialS&veices and Trcasurer 3

ATT'ACHMENT FORM OF INTER-COMPANY CREDIT NOTE IS120"millionl (Available: Credit) _

Bailtimore Maryland 2009 NINE MILE POINT NUCLEAR STATION, LLC,. aDlaware limtiited liabilitycompany ("NMP LLC"), for value:ireceivedand in consideration .oifthe: .execution anddeliviery byvConstellation Eneigy Group,I!ic., a Maryland cororrai.tion ("Parent")'of that,certain. Inter-Company Credit Agrccmcnt, effective as of[ I (the "'Agreement"),

hereby promises to pay to the order of Parent on the Maturity Date,.the principal sum of

$120 millionI, or so much bthcreof as may be' utstanding hereunder, together with any, accrued but unpaid interest. Prior to maturity, interest shall be due and payable by NMP LLC periodically as noted by Parent at the timeofany adne and asfsetforh on the grid :attached hereto and made a part.hereof.

This, Notesis ssued byNMP LLC pursuant. to the Agreement, to which referenence is :made for cer-tain terms and :cornditions applicable hereto. Capitalized terms used.in'thisNote shall, unless the ~contexttotherwise requires, have the same' meanings assigned.:.to them. in the.Agreement.

Both the principalpof this-Note and interesthereon are'payable .in lawful mioney.of-the Untied Statesof America;, which, will be immediately avaiiable.on the :day:

when payment shall become due, at: the principal.office of Parent. Interestshfal be paid on overdueprincipa] hereof and tobthe extenttlcgally enforceable; on overdue interest, at a ratedof 11%.overn the then current prime lending.rate per annum.

The outstanding principal amount of this Note shall'be increased or decreased upon anvyincrease. or decrease in the, outstanding aggregate principal amount as provided under theterms of Sections 1.02 and 1.06 of the Agreement;:provided, however, that at no time shall the outstanding principal amount of this Note exceed the Available Credit. Upon any such increase or decrease in the principal amount ofthis'Note, Parent shallý.caus.'etoobe shown6iupon the grid portion of thiS Notethe date and'amiuntof such increase or, decrease,: as: the ease may be. Allrnotations byParentton'the grid shalll be:

concIusive. absent manifest error.

Upon paymfent i-n fuilo0f the principalIof andminterest on this Note and all other sums due from.NMP LLC to Parentunder the terms of this Note and the Agreement at the, MaturityDate, this Note shall be canceled and. retumed to NMP LLCand shall be of no further:operation or effect.. Thecobligationmof NMP LLC to make the payments

.required to: be made: on this Note and under the Agreement and-to performi arnd ;observe the other agreemnents:onitspart :contained herein and thereinhshall .be~absolute and unconditional and shall not be subject to diminution by setoff, ,counterclaim, abatement or oth&rwise.

4

Upon the occurrence ofan: event.giving rise to a right on the ,part: of Parent, the Agreementas set torth in sections 2.01, 2.02,:and 2.03 of the Agreement,;

to terminate the, maturity of this Note may be accelerated and the principal of and intere-s:tonsand: any other sums due from NMP.LLCto Parent uinder the terms of this Note may:be declaredý immediately due and payable as provided for in the Agreement.

This Note:isjissued with the intent, thatit, shall beegoverned by,.and construed in*accordance With, %thelaws .of the. State :of.Maryland.

N WITN*ESS WIIEREOF, Nine Mile Point NMP LLC Station, LLCI has-caused this.Note o**be duly executed in its name, and itscorporate seal to:be hereunto affixed and attested, by:its duly authorized officer as-of______ 2009.

NINE MILE:POINT NUCLEAR STATiON,;LLC

Title::

5

MASTERDEMAND NOTE Dated: June, 3, 2,1004 Effective: June 1:0, 2004 undersigned (each a 'Par.y", collectively the Each of the each other

ý"Parties") anticipate enter!.ing into. one or more loans with Any such loans from time to time as either a borrower or a lender. Note, will 'be, governed by this Ma ster Demand between any of the Parties

ý"GriId,"). At and the grid attached hereto and made a pa4Kt hereof '(the o' lend money .to, or borrow money from, any time that a Party desires, t Energy

.another: Party the Chief Financial Of~ficer of .Constellati~on to endorse on- the. Grid the date

'Group, :Inc. and her staff is, authorized the 'interest rate and the Of each loan, the principal amount therreof, is the. borrower and *the Party that is the identi-*ty: of the Party that the Grid shall be binding: on the Parti:es,

lender. All notation on

',absent, manifest error.

For value received., each Party that, is a iborrower promri'ses to ,pay to the 'order of each. Party that is a lender the pr,incipal borrowed as

.evidenced on the Grid in accordance with :the terms hereof-, together with accrued interes't. **n any .and all principal: .amounts remalnilnI unpaid, hereunder from the date of :such Io'an until"':payment: in fuulI, at.. a, rat-e Tper annum :noted on: the .Grid,until such :praicip."l amount shall have,

.become dueý and ,payable;. pand at: the rate' .of 2% o.ver, the grid rate0 on any.

by applicable law): qn.

overdue pri ncipal and (to :the extent ppermi~tted Io any verdu'e. inIterest:, from the date: on which paymenIt is due until the obligation of the borrower with. respect to.'the payment thereof shal..be discharged.. Interest hereunder shall be: calculated on the basis of a.

three hundred siixty-five (3.65) day year co in*ing the atual number of, days elapsed4.

The borrower promises to, pay -the. Iender the outstnding: prin'cipal.

in amount of this Note: together with ýall accrued but unpaid interest, lender's demand-. All of. the:

one installment within 2.4 hours4.62963e-5 days 0.00111 hours 6.613757e-6 weeks 1.522e-6 months . of princ.ipal mntay be. prepaid: by borrower :at any time, together' with a'll accrued interest tthereon to the-date "of 'payment, without penalty with

.f:ivEt (5')ý days%priorwritten notice.

All principal 'and interest 'hereunder are payabie in lawlfuj'l money of the United States of America ýat the 'address of thle lender. shown beneath i'ts signature.

No .delay *or ý.omisslon on the, part of- the Lender' in exercising any rights he~render shall operate as a waiver of suc h rdight or, any other of'.fsuch Iende.i nor shall any delay, mission -or waiver on any right; one occasion be deemed, a bar to :or. waiver, of the same or any other right on any future :occasion.

The, borrower for itself and its respective legal:,.. representativ(es, successors and ass1ighs, hereby expressly waives presentment., demand, DEMAND Note (fiial.)

iC:.\Docum.enrts andi Sett:ings\'e63S24\LaJcal SettingsýTemporary Internetf ,Files.\LKid\Gimna 4610047.dbc 6/3/2004 3:12 PM

protest.,t o prot'est, presentment notice. If for the purpose: of accelerati.ng maturity and diligence in co1lection.

This Note and,. all 'transactions hereunder: and/or evvidenced6. herein shall-be governed by., const-rued.. and enforced in accordance With:- the of laws of the State :.of: Maryland, (withou* giving effect to its .choice Taw rules), and shal'l have the effect* of a sealed instruument..

IN WITNESS WHEREOF, the each P'artyl has caused this: Nolte to be executed by its duly authorized officer, under seal.,. .as Cof .the date

,first above: wri tten.

CONSTELLATION ENERGY GROUP,, INC,.

Nam: Thomas Re.. Jr.

Title:: Treasurer /

Address:! 750. East Pratt 'Street.

Baltimore:, MD 2ýl2-02' State of Incorporation: Maryland!

R.;Z- GINNA NEXCLF.AR-POWER PLANT, LLC

.By:: _ _ _ _ __ _ _ _ __ _ _ _

Name: Stephen A. Mbrmann-

Title:

Treasurer Address: 111 Market Place Baltimore, MD 2120(2' State of Incorporation: Maryland

INTER-COMPANY CREDIT AGREEMENT This Inter-Company Credit Agreement (the "Agreement"), dated October 21. 2009, effective:as of October 21, 2009, by and between Constellation Energy Group, Inc. (Parent) and its affiliate, R.E. Ginna Nuclear.

Power Plant, LLC (Ginna LLC).

RECITALS A. Nuclear Regulatory Commission ("'NRC") regulations require the licensee:ofGinna LLC nuclear power reactors (collectively, the "Facilities") to provide financial assurance of its ability to protect public health and safety.

B. Ginna LLC participates:in a cash pool that.the lParent operates for the benefit:of all of its subsidiarieso.The cash pool is intended to provideGinna.LLC with the cash necessary to, meetjits day-to-day cash needs, includingdits obligation to protect public health and safety.ý However, if the cash pooi, at any time, cannot meet those needs, then Patrent has

.agreed to provide credit toGinnaLLC to allow it to meet its obligation to protect public health and safety.

The parties, for adequate consideration and intending to be legally bound, hereby agree as-follows:

ARTICLE I THE ADVANCES Section 1.01. Advances. During-the period from the date ofthislAgreementlto and including. the.Maturity Date (as defined in Section ,L03),Parent agrees, on the terms and conditions set forth herein, from time-to-time, to extend credit to: Ginna LLC; provided, however, that the aggregate principal amount of all advances outstanding at any .time shall not exceed $80 million. During the term of this Agreement, Ginna LLC, at its option and :without penalty or premium,:may from :time to time repay all or any partlof the principal amount outstanding as provided in Section 1.06, and may reborrow any amount that has been

repaid. Each advance: offmnds under this.Agreement shall be in a minimum amount of$SS million and, if greater, shall be in an integral multiple of $1 million.

Section 1.02. Request for an Advance. Each request for an advance of funds under this Agreement.shall be made not laterlthan noon on the secondý business day prior to the proposed drawdownby :notice from Ginna LLC'to Parent (pursuant to procedures that may be..changed from time to time by mutual agreement) specifying the amount of the advance and a certification that such advance is for the purpose-specified in Section 1.07.

Section 1.03. The Note. At the time of the first advance;Ginna LLC will execute a note in substantially the formattached hereto as Exhibit A (the "Note") and deliver it to Parent. Any advance provided by Parent to Ginina LLC, and any payments of principal and interest by Ginna LLC,,shall be noted by Parent on the grid attached to the Note. Such notations shallbe.conclusive absent manifest error. The Note is payable to the order of Parent at its principal office in Baltimore, Maryland, and matures on the Maturity Date (subject to thelterms of Article 11 hereof). The "Maturity Date" shall mean: (i) the 5th year anniversary date of the date of this Agreement; (ii) such earlier termination date as may occur pursuant to Sections 2.01;.Ior 2.02, or 2.03; (iii) such later date as maybe mutually agreed by the partiesthereto pursuant to Sectfion 109; or (iv) at the date of closing on any transactio in mwhich:* (a).the assets (eXcept asset sales in the:ordinary couse of business) or stock of Ginna LLC.are .sold to an unrelated third patItyof.Parent, or (b) Ginna LLC is merged or consolidated into an unrelated.third paTrt of Parent whether by operation of law or otherwise; If the Maturity, Date is not a business day in Baltimore, Maryland, the next'succeeding business day shall be deemed to be the Maturity Date.

Section :1.04. Interest. Interest on any principal amount outstanding shall accrue daily alStisch:rate.,and shall be payableW at such times, as established by Parent at the time of anAdvance. The interest rate applicable to any advance.: and the' time of payment shall be: noted on the grid attached to the Note by Parent. Such notations shall be conclusive abseht manifesterror.

Section1l.05. Funding and Repayment. Each advance of funds under this Agreement shall be.made in U.S., Dollars in immediatelyvavailable funds, on.each drawdow dateat such place :as Parent andlGinna LLC may agree. All repayments and prepayments.by Ginna.LLC of principal and interest; and of al other sums:due under the Note.:or this .Agreemerit shallbe madewithout deductioi, setoffb abateient, si spension,

deferment;,defense or counterclaim, o.n orbef orethe due date'ofrepayment or payment, and shallibe made in.U.S. dollars in. immediately available funds: at the principal office of Parent.

Section 1.06. Optional Prepayments. Ginna:LLC, at its option, may prepay allor any part of the pri.ncipal amount outstanding from.tiime.to time without penalty or premium, upon at least 2 business'days.

prior notice (which, if oral,z shall be confirmed promptly in: writing) to Parent; provided, however, thatfif the intIerest rate is LIBOR based, a prepayment penalty may be assessed against Ginna LLC. Anymprepayment penalty would be established at the time of an advance. Parent, at its option, may waive such notice requirements as to. any prepayment.

Section 1.07. Use of Proceeds. In order to provide financial assurance, anyt advance may be used by Ginna LLConlyv.to meet:its expenses and obligations: tosafely oPerate~and'maintain theFacilities, including; payments for, nuclear property damage insurance and aretrospectivepremium pursuant to Title 10, Part .140, Section21! ofthe Code offederal Regulations (10 CFR 140.21).

Section 1.08. Commitment Fee. At(,the time of any ad.vance;,Parent will notify Ginna'LLCof any commitment fee and the method and time of payment. Such commitment fee will onlylbe in an amount necessary, to.offset'Pareni' s operating expenses regarding the advance.

Section 1.09. Extensionwof Maturity Date. This Agreement and the Maturity Date hereundernmay be extended for,successive periods of two years each upon:the mutual agreement ofthe parties.

ARTICLEII TERMINATION:

Section,2.0i. Termination upon Unenforceability. Parent, at its option, shall have Ithe right tot cease makingzadvances under this Agreement, to terminate thisAgreementandor /to. make the outstanding.

principal amount and interest thereon and any other sums due under the .Noteand this.Agreement immediately due, and payableruponwrit-ten.or oral notice to GinnaLLC,.butawithout the requirement.of any:

furthe.ror other notice, demand or=presentment of the Note for payment, if thisAgreement or the Note shall at anyvtime for any reason. ceaseto0 be, in full force and effect orsha*llbe null and void while the Note is outstanding, or the validity or enforceability of this Agreement or,theNote*shall .be contested by.any person, or:Ginna LLC shalIt deny. that :it. has any further liability or obligation under this Agreement or.the

Note.,

!Section 2.02. Termination Upon Permanent'Cessation'of Operations or NkRC Approval.

Notwithstading any other provisions in this Agreement or theNote to the: contraryexceptas provided in Sections 2.0 1.and:2.03 herein, Parent agrees that it will proýide -the credit to Gifina-LLC for the purposes defined in:Se6tion 1.07,tand in no event shall this Agreement be terinated, nor shall Parent cease to6make

.advances under this Agreement; until the earlier of: (i) suchtiiimhetat Ginna;.LLChas permanenly ceased operations at the Facilities;!,or (ii) the NRC has given written appro.val for the discontinuiiane~or termiahtibn of this Agreement; or (iii). upownthe date of closing on any-transaction. in Which (a) the* asats(excepi asset ales in the ordiny course of business) orustock of Ginna LLc:are solto:an unrelated thirda part of Parent, or (b) Ginna LW& is meriged ori cnolidated into an unrelated third party of Parentiwhether by operation of law or otherwise.

2

Section '2.03. Substitution of Financial Assurance. Parent can terminate this Agreement upon 45.daysy written noitcetoGinna LLC if Parent has procured a substitite lo.n facility and/or,letter of credit for Ginna LLC thatineets thefinanciAl ass'uranýce requirements of the NRC to protect .:the publi chealth$and safety.

Such substitute loan facility" and/or letter of credit shall remain in'effect until ithe earlier o6f (i) such. time. that Ginna LLC haspermanently ceased operation:s at the Facilities; (ii)the NRCihas given.written approval of

.the discontinuance or terminati6n 6fthe substitute loan: facility* nd/or letter of credit; or (iii) if Parent has procured another substitute 1oan facility and/or letterof credit f6rGinnaLLC thatineets the fifiancial assurance requirements :of the NRCtob.protect the public.health and safety.

ARTICLE4i1i MISCELLANEOUS Section310l. Notices. Any communications between the parties hereto, and notice provided herein to be giyen, may be given by:mailing or otherwise by delivefingithe same&toIthe Treas urr:of Parent and.the Treasurer0of Ginna LLC,at :the principa.loffices.of Parent and Ginna LLC, respectively,' or to such:other fficers::or~addresses as either: party may in writing hereafter specify.

Section'3.02. Remedies. No delay or omissionmto exercise anyright,.power or remedy accruing to Parent

undernthis Agreement shall impair any such. right, power or remedy, nor shall it be construed to be a waiver of any such. right, power or:remedy. Any.waiver, permit, consent or

the p art. ofParent of any breach or: default:under: this Agreement,.. mustapproval of any'kind or chharacter on bet in writing and sh~all be effective:

o.nly to the extent specifically set: forth: in such writing. All remedies, either under this Agreement orby law or otherwise afforded to Parent, shall be cumulative andnotaltemative.:

,Section' 3.03. Miscelianeous., This Agreement mayvnotbe amended unless in writing signed by botht parties.- This Agreemenit is governed~by Maryiandlaw This Agreement may not be assigned by either party without the prior written consent of the other: party.

IN WIINESS: WHEREOF, the parties .hereto have, executed thisAgreement by their duly. authorIzed officers", as. of the date first above written.

CONSTELLATiON ENERGY GROUP, !NC.

.By.: Z .

Name: Reese K. Feuenrnah

Title:

Treasurer 3.

Exhibit A FORM.OF INTER-COMPANY CREDIT NOTE

[$80.0million](Availb.le Credit) _____ 009 Baltirhi.0oeMairYlad R.E. GINNA NUCLEAR: POWER PLANT, LLC,, a Maryland limited liability company ("Ginna:LLC"),: for valuexreceived and in consideration of the execution and delivery by Constellation Energy Group, Inc.,a Marylanddcorporation("Parent ofthat certain Inter.-Company Credit Agreement, effective-as of [ I(the

"ýAgreement"), hereby promises to pay to the orderof Parent on the Maturity Date, the, principal sum of [$ 80 million], or so much thereof as may be outstanding hereunder, together: with any accrued but unpaid interest. Prior to maturity, interest shall be due and payable by Ginna LLC periodicallyasnotedby Parent at-the.timeof any advance andas set forth on the grid attached hereto and made a part hereof This Note is issued by Ginna LLC pursuant to %the*Agreement, to which reference is made for certainjterms and conditions'applicable hereto. Capitalized terms used in this Note shall, unless the context otherwise requires, have the same: meanings assigned to them in!the Agreement.

Both theprinipal of this Note and interest hereon are payable in l[awful

.money of the Untied Statesof America, which willbe immediately :available~on the day

when'payment shall become due, atthe principal office of parent. Interest shall be paid

on overdue principal.hereofand to the extent legally enforceable, on overdue intereSt, at'a rate of.[1% ovepthethenc prime lending rate ip*r annum.

rrent The outstanding"'principal amount of this Note shallbe :ihcreased or decreased upon any increase or: decrease in the outstanding aggregate principal amount as provided unider the:terms of.Sections 1.02 and :1.06 of the Agreement; provided, however, that at no time shall the outstanding principal amount0of this Note exceed the Available:

Credit. Upon anysuich increase or decrease inithe principal amount of this Note, Parent shall-cawse to be shown upon the grid portion of this Notethedate and amount of such increase or decrease, as thecasemay be. All notations by Parent on the grid shall be conclusive absent manifest error.

Upon payment in full of the principal of and interest on this Noteoand all other sums due from Ginna LLC :to Parent under the'lterms of this Note and the Agreement at the Maturity. Date, this Note shall be canceled and returned to Ginna LLC

.and shall be of no further operation or effect. The obligation of Ginna.LLC to make the payments required to be made on this Note and under the Agreementfand to perform and

.observe the other agreements on its part contained herein and therein shall be absolute 4

and unco'nditional and shall not be subject to.diminition :byýset0 ff c,.counterclaim, abatement:or otherwise.

Upon the occurrence of an event.giving rise to a right on the part of Parent

'to terminate the Agreement as set forth in sections 2.01, 2:02,. and 2.03 of the Agreement, the maturity of this Note may be accelerated and the principaltof and interest on and any

.other sums due :from Ginfa, LLC to Parent under the terms, of this Note may be declared immediately due and::payable as provided for in the Agreemrent.

This Noteiis issuedmwith ;the intent that it:shall be:govemed by, and construed&in accoidace*with,*'the laws of the State.ofIMar-aiind.

IN WITNESS:IHEREOF, R.E. GINNA NUCLEAR -POWER PLANT, LLC has causedtthis Note to be duly executed inits name, and its',corporate seal to be hereunto affixed and attested, by:its§duly authorized officer.:as of . j 2009.,

R.E. GINNA NUCLEAR POWER PLANT, LLC By:

Title:

5.

ATTACHMENT (2)

UPDATED NET INCOME

SUMMARY

(NON-PROPRIETARY)

Constellation Energy Nuclear Group, LLC October 25, 2009

ATTACHMENT 2 UPDATED NET INCOME

SUMMARY

(NON-PROPRIETARY)

NRC Submission v. 10/22 Market Projections NET INCOME 2010 CCNPP NMP Ginna Fleet 1/22/2009 (Ref. (a)) Att. (5A) _____ ____ __________

1/22/2009 (Ref. (a)) Att. (5A) w/ 10%

reduction in market prices ______ ___________

10/22/09 current market analysis ___________ _____ _____

NET INCOME 2011 CCNPP NMP Ginna Fleet 1/22/2009 (Ref. (a)) Att. (5A) 1/22/2009 (Ref. (a)) Att. (5A) w/ 10%

reduction in market prices 10/22/09 current market analysis NET INCOME 2012 CCNPP NMP Ginna Fleet 1/22/2009 (Ref. (a)) Att. (5A) 1/22/2009 (Ref. (a)) Att. (5A) w/ 10%1 reduction__in__market prices ______________ ____________ ____________________________

10/22/09 current market analysis NET INCOME 2013 CCNPP NMP Ginna Fleet 1/22/2009 (Ref. (a)) Att. (5A) 1/22/2009 (Ref. (a)) Att. (5A) w/ 10%

reduction in market prices 10/22/09 current market analysis NET INCOME 2014 CCNPP NMP Ginna Fleet 1/22/2009 (Ref. (a)) Att. (5A) 1/22/2009 (Ref. (a)) Att. (5A) w/ 10%

reduction in market prices 10/22/09 current market analysis 7 7...' . .'................ . .. ', "** :

Constellation Energy Nuclear Group, LLC October 25, 2009

ATTACHMENT (3)

RESTRUCTURING STEP TABLE Constellation Energy Nuclear Group, LLC October 25, 2009

ATTACHMENT 3 RESTRUCTURING STEP TABLE The following table documents the specific steps, rationale, nature of license transfer, timing, and governance matters involved in structuring and leading to completing the transaction by which EDF Development acquires a 49.99% interest in Constellation Energy Nuclear Group, LLC.

Step Transaction Description/Rationale Nature of Transfer Timing Financial Reference to Assurance Application, Documents Order and SER 1a Form Constellation Energy None. Formed on 9/21/09, but Note 1 April 8, 2009 Constellation Group, Inc. (CEG) did not become part of supplement to Nuclear, LLC creates a shell company, CEG is sole and licensee structure until LTA p. 2, shell Constellation Nuclear, controlling member 10/14/09. Because the bullet 1; Order LLC, that eventually of Constellation Maryland PSC required p. 2; SER at will hold 100% of Nuclear, LLC. the submission of an 2.0 CEG's interest in amended purchase CENG. This company agreement and will elect to be treated Constellation Nuclear, as a corporation for LLC is the seller in the federal income tax purchase agreement, purposes. completed on 9/21/09.

Needed to be formed at least one day prior to CEG's contribution to CNL of its membership interest in CENG.

lb CEG contributes CEG contributes 100% Indirect transfer. Completed 10/14/09 Note 1 April 8, 2009 Constellation of its membership Non-operational. (contribution needed to supplement to Energy Nuclear interest in Constellation occur at least one day LTA p. 2, Group, LLC to Energy Nuclear Group, Constellation prior to step I c) bullet 1; Order Constellation LLC to Constellation Energy Nuclear p. 2; SER at Nuclear, LLC. Nuclear, LLC. With Group, LLC 2.0 the election to treat becomes a wholly-Constellation Nuclear, owned subsidiary of LLC as a corporation Constellation completed in Step la, Nuclear, LLC. As CEG can contribute its sole and controlling

ATTACHMENT 3 RESTRUCTURING STEP TABLE membership interest in member of Constellation Energy Constellation Nuclear Group, LLC to Nuclear, LLC, CEG Constellation Nuclear, thereby retains all LLC in Step lb. control rights over Constellation Energy Nuclear Group, LLC.

Ic CENG elects to Tax step. The None Completed 10/15/09. Note 1 N/A become a conversion of CENG to Needed to occur at least disregarded entity a disregarded entity one day after step l b for income tax avoids a corporate purposes under the double taxation on the income tax earnings from Nine regulations. Mile Point, Ginna and Calvert Cliffs when CENG is jointly owned by EDF and CEG and also allows the eventual distribution of CENG's 50% ownership interest in UniStar to be distributed without triggering a taxable gain.

ATTACHMENT 3 RESTRUCTURING STEP TABLE 2 Constellation The conversion to a None. Completed 10/15/09. Note I April 8, 2009 Nuclear Power disregarded flow- Conversion needed to supp. to LTA Plants, Inc. through entity will Constellation take place prior to p. 2, bullet 2; converts to avoid corporate double Nuclear Power distribution steps 5 and 6 Order pp. 2-3; Constellation taxation on the earnings Plants, LLC to avoid triggering a SER at 2.0 Nuclear Power from Nine Mile Point, assumes all rights, taxable gain discussed Plants, LLC Ginna (and Calvert obligations and below Cliffs after Step 4) after liabilities of CENG becomes jointly Constellation owned by EDF and Nuclear Power CEG. Plants, Inc. by operation of law.

4 i +

3 Constellation Formation of Calvert None. Completed 10/16/09. Note 1 N/A Nuclear Power Cliffs Nuclear Power Formation needed to Plants, LLC forms Plant, LLC is a non-tax occur prior to Calvert Calvert Cliffs event (formation of a Cliffs conversion to LLC Nuclear Power disregarded entity). The by merger in Step 4.

Plant, LLC (a new LLC is being Maryland Limited formed as the vehicle Liability- for converting Calvert Company) Cliffs Nuclear Power (CCNPPL). This Plant, Inc. (CCNPPI) is a shell company into a disregarded flow-owning nothing at through entity in Step 4 this point.

ATTACHMENT 3 RESTRUCTURING STEP TABLE 4 The merger of Calvert Direct Transfer. Not completed. Before Note 2 January 22, Calvert Cliffs Cliffs Nuclear Power the Articles of Merger 2009 LTA, pp.

Nuclear Power Plant, Inc. into Calvert By conversion by will be recorded by the 11-12; April 8, Plant, Inc. merges Cliffs Nuclear Power merger, Calvert Maryland Department of 2009 supp. to into Calvert Cliffs Plant, LLC will result in Cliffs Nuclear Assessment and LTA, p. 2, Nuclear Power the conversion of the Power Plant, Inc. Taxation, the Maryland bullet 3; Order Plant, LLC. Calvert Cliffs corporate ceases to exist and Recordation and p. 3; SER at entity to an LLC under Calvert Cliffs Transfer Taxes on the 2.0, 3.0 and Maryland law and avoid Nuclear Power Calvert Cliffs real 4.2 corporate double Plant, LLC assumes property must be paid, taxation on the earnings all rights, based on real property from Calvert Cliffs obligations and valuations. For this when CENG is jointly liabilities of Calvert reason, the completion owned by EDF and Cliffs Nuclear Step 4 may require at CEG. Power Plant, Inc. least one full business Surviving entity day to complete.

(CCNPP LLC) maintains same officers and directors.

5 The successive None. Involves Distribution of the Note 2 N/A Calvert Cliffs distribution of Calvert reorganization of Calvert Land Nuclear Power Land Corporation Stock subsidiary related to Corporation stock must Plant, LLC from three disregarded new nuclear take place after the Distributes its entities. development (no completion of the stock in Calvert license involved). Calvert Cliffs LLC Land Corporation conversion in Step 4.

to Constellation For this reason, Calvert Nuclear Power Land Corporation stock Plants, LLC. distributions should take Constellation place on the day Nuclear Power following the date of the Plants, LLC then Calvert Cliffs LLC distributes the

ATTACHMENT 3 RESTRUCTURING STEP TABLE Calvert Land conversion.

Corporation stock to CENG, which in turn distributes the Calvert Land Corporation stock to Constellation Nuclear, LLC.

6 Because Constellation None. Involves Because Constellation Note 2 N/A Constellation Energy Nuclear Group, reorganization of Energy Nuclear Group, Energy Nuclear LLC has been converted subsidiaries related LLC directly owns its

.Group, LLC to a disregarded entity to new nuclear membership interest in distributes its in Step I c, the development (no Constellation New membership distribution by license involved) Nuclear, LLC and interest in Constellation Energy CeTerre, LLC, these Constellation New Nuclear Group, LLC of distributions can take Nuclear, LLC and its membership interest place anytime after its interest in in Constellation New Constellation Energy CeTerre, LLC to Nuclear, LLC and Nuclear Group, LLC Constellation CeTerre, LLC to becomes a disregarded Nuclear, LLC. Constellation Nuclear, flow-through entity LLC should have no tax (Step lc).

consequences.

ATTACHMENT 3 RESTRUCTURING STEP TABLE Constellation Nuclear, Indirect Transfer. It is critical that the Note 2 April 8, 2009 7 Formation of LLC forms a new Non-operational formation of the supp. to LTA, Constellation company, CE Nuclear, partnership take place p. 2, bullet 1; Energy Nuclear LLC that will elect to Constellation after steps 1 through 6. Order p. 2; Group partnership be treated as a Nuclear, LLC The Calvert Cliffs LLC SER at 2.0 (wholly owned by corporation for federal (solely owned and conversion in Step 4 Constellation income tax purposes. controlled by CEG) would become a taxable Energy Group Afterwards, is the sole and transactions if the affiliates. Constellation Nuclear controlling member Constellation Energy LLC will contribute a of CE Nuclear, Nuclear Group, LLC 1% membership interest LLC. partnership were formed in Constellation Energy prior to completing these Nuclear Group, LLC in Constellation steps. Specifically, a constructive exchange Energy Nuclear taxable gain would be for additional Group, LLC recognized equal to the membership interests in becomes a difference between the CE Nuclear, LLC. subsidiary of both fair market value of the Constellation Calvert Cliffs Nuclear The contribution by Nuclear, LLC and Power Plant, LLC and Constellation Nuclear CE Nuclear, LLC, to the cost basis of the LLC of a 1%

which Constellation interest. The gain membership interest in Nuclear LLC recognized would be on Constellation Energy transfers 1% of the 100% of the built-in gain Nuclear Group, LLC in membership (not just 49.99%) and exchange for interests of would be triggered membership interests in Constellation regardless of whether the CE Nuclear, LLC is Energy Nuclear EDF transaction closes.

intended to be Group, LLC.

nontaxable transaction. Step 7 should be As a result of Step 7, completed at greater CEG thus retains all Constellation Energy control rights over than one week (eight Nuclear Group, LLC is days) prior to closing the Constellation owned by two members Energy Nuclear EDF transaction.

and is automatically Group, LLC.

classified as a

ATTACHMENT 3 RESTRUCTURING STEP TABLE partnership for federal income tax purposes.

Acquisition of January 22, 8 - 10 EDF ownership interest in Indirect Transfer Greater than one week Note 3 2009 LTA pp.

Development's Constellation Energy following Step 7. Steps 11-12; April acquisition of Nuclear Group, LLC 8 through 10 are 8, 2009 supp.

49.99% of CENG joint venture completed concurrently. to LTA p. 2, bullet 4; Order

p. 2; SER at 2.0 Note 1: At the time the Orders were issued, the existing financial support mechanisms consisted of: 1) the Master Demand Notes (i.e. cash pooling) directly between Constellation Energy Group, Inc. (CEG), and the licensed entities; and, 2) the Inter-Company Credit Agreements (ICAs) directly between CEG and the licensed entities. The ICAs for each facility, which were in the amounts of $1OOM for Calvert Cliffs, $100M for Nine Mile Point, and $60M for Ginna. These mechanisms have been in place for the facilities since their former license transfer activities in 2000, 2001, and 2004, respectively. The parties to these documents are Constellation Energy Group, Inc. and the named facility licensee.

Note 2: Since the Orders have been issued and in response to communications with NRC Staff, the ICAs for each unit have been increased to

$105M for Calvert Cliffs, $120M for Nine Mile Point, and $80M for Ginna. These amounts are consistent with the 6-month outage cost estimates provided in Reference (a) and subsequent comments by the Staff related to the Ginna facility. Although not required by the Order, Constellation has taken these actions, to provide assurance of adequate financial support during the interim period before the consummation of the transaction regarding EDF Development's interest in CENG. The parties to these documents are Constellation Energy Group, Inc. and the named facility licensee.

Note 3: Upon consummation of the transaction in which EDF Development, Inc. acquires an interest in CENG, the new financial support mechanisms described in the application, as supplemented, and reflected in the NRC Orders, will become effective and will replace the existing Master Demand Notes and ICAs currently in effect.

ATTACHMENT (3A)

RESTRUCTURING GRAPHIC REPRESENTATION I

i

EdF Purchase of Constellation Energy Nuclear Group, LLC (CENG LLC)

Structure per Amendment No. 2 To The Master Put Option and Membership Interest Purchase Agreement 10/25/2009 4:21:09 PM

Current Organization 50% 50%

91%

50% 50%

Q+ p 1 -CENG Contributed to Constellation b Constelllation Nuclear, LLC with CENG Energy Group, Inc ... L Bec oming a Disregarded Entity a 1Constellation Nuclear, LLC

/ (DE)

I L I t\ ,'tffs n'a~I6"f I , \ Energy I

/ \ tNuclear n Group,.LLC CENG LLC I' LLC '

50% 50%

Step 2 - Constellation Nuclear Power Plants, Inc. Converts into Disregarded LLC 50%

I'

/ '

I \

9*'on stellatio\

Nuclear Powet I/ Plants, A

I 50% 50%

Step 3 - Consitellation Nuclear Power Plants, LLC Forms Calvert Cliffs Nuclear Power Plant, LLC ear, LLCI EInter CENG, LLC 50% 50%

Calvert Cliffs Nuclear Power Plant, Inc. 91%

eTerre,

%\ Calvert Land Corporation

'Calvedr LL.C _

(Cliffs, ,0% 50% 5o, 0%o 50

Step 4 - Calvert Cliffs Nuclear Power Plant, Inc. Merges into Calvert Cliffs Nuclear iltionf Pow'er Plant, LLC LLC [ !

I Intemn I ICalvertClffs .1 A-uclearowr Hl Plant, Inc. o91%

/ CeTerre; Calvertt Land 9 vertl Corporation 506%. 50%

nstellati i

Step 5 -Calvert Land Corporation Stock is Distributed to Constellation Nuclear, LLC 50% 50%

91%

44 ilat 9%

Step 6- CENG Distributes its 91% Interest in Constellation New Nuclear to Constellation N uclear, LLC EC Constellaton Intemat(

Nuclear, LLC

.rt Land ration !'

CENG, LLC I50%. 50%

9%

Step 7- Constellation Nuclear, LLC Contributes a 1% Interest in CENG forInterest in CE Nuclear, LLC

, Const ,o,ooatt nt EeaN l L-LC.

Interest/ 5%

in-CENG I1;00%

I ~~~irnt rei'e t C E . ..

.......... LLC ICE Nuclear, 1. 005,50 LLC: *-*e~~LLcre*

if CENG, i LLC i

Restructured CENG Prior to EDF Contribution and Purchase 99%

91%

1%

50%

50,%

Ii

Step 8- EDF Contributes Cash to CENG In Exchange for a Membership Interest Constellation___ _

Nuclear, LLc.

91091% Calvert Land ii ~Corporation

$1670 rMillion!

99%YO of Caon

!i* 9%

1%

50%

Step 9- CENG D istributes Cash to CEG for Preformation Expenditures and Qualified r Liabilities ld

Step: 10 - EDF Purchases. Interest in CENG from Constellation Nuclear, LLC Consteilation billion Calveit Land Corporation 91.62%

Restructured After EDF Purchase 49.08%

50%o LI

ATTACHMENT (4)

AFFIDAVIT BY H.B. BARRON

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )

)

Constellation Energy Nuclear Group, LLC, et al. )

AFFIDAVIT I, Henry B. Barron of Constellation Energy Group, Inc., parent of Constellation Energy Nuclear Group, LLC, for Calvert Cliffs Nuclear Power Plant, Inc., Nine Mile Point Nuclear Station, LLC, and R. E.

Ginna Nuclear Power Plant, LLC (together, the CENG Companies), do hereby affirm and state:

1. I am authorized to execute this affidavit on behalf of the CENG Companies.

2. The CENG Companies are providing information in support of their Application for an Order Approving License Transfers and Conforming License Amendment Request. The documents being provided in Attachment (2A) contain proprietary financial information and financial projections related to the ownership and operation of the CENG Companies' generation assets.

These documents constitute proprietary commercial and financial information that should be held in confidence by the NRC pursuant to the policy reflected in 10 CFR §§ 2.390(a)(4) and 9.17(a)(4),

because:

i. This information is and has been held in confidence by the CENG Companies.

ii. This information is of a type that is customarily held in confidence by the CENG Companies, and there is a rational basis for doing so because the information contains sensitive financial information concerning projected revenues and operating expenses of the CENG Companies.

iii. This information is being transmitted to the NRC voluntarily and in confidence.

iv. This information is not available in public sources and could not be gathered readily from other publicly available information.

v. Public disclosure of this information would create substantial harm to the competitive position of the CENG Companies by disclosing their internal financial projections.

3. Accordingly, the CENG Companies request that the designated documents be withheld from public disclosure pursuant to the policy reflected in 10 CFR §§ 2.390(a)(4) and 9.17(a)(4).

Henry B. Barron Subscribpbd and swqrnbefore me, a Notary Public, in and for the State of Maryland and City of Baltimore, thi _?6ay of__ 2009.

WITNESS my hand and Notarial Seal: ..,_,,,_,..___._

My Commission Expires:

v t e Letter Sequence Request
TAC:ME0443, (Approved, Closed)
Initiation Request, Request, Request, Request, Request, Request, Request Acceptance Supplement, Supplement, Supplement Administration Meeting Questions 10 June 2009 15 July 2009 Answers Results Approval, Approval, Approval Other: ML090760564, ML090760582, ML090760616, ML090760623, ML090760681, ML090760687, ML092570573, ML092570583, ML092570606, ML092570614, ML092570623, ML092590265, ML092880122, ML092880813, ML093000630, ML093000631, ML093000633, ML093000634, ML093000635, ML093010001, ML093070737, ML093290246, ML093310365, ML093310366, ML103090261
MONTHYEAR2009-11-25 [Table View]

ML093000127

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