Document:

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                                                                    Exhibit 4(b)

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                        CONSTELLATION ENERGY GROUP, INC.

                                       AND

                              THE BANK OF NEW YORK

                                     Trustee

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                          FIRST SUPPLEMENTAL INDENTURE

                          Dated as of January 24, 2003

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                                TABLE OF CONTENTS

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ARTICLE ONE
DEFINITIONS; GENERAL.....................................................................................1
         SECTION 1.1     Certain Additional Terms Defined................................................1
         SECTION 1.2     Rules of Construction...........................................................3
         SECTION 1.3     Authority.......................................................................3
         SECTION 1.4     Notice to Securityholders; Waiver...............................................3
ARTICLE TWO
CONVERSION OF SECURITIES.................................................................................4
         SECTION 2.1.    Conversion Privilege and Conversion Rate........................................4
         SECTION 2.2.    Exercise of Conversion Privilege................................................5
         SECTION 2.3.    Fractions of Shares.............................................................6
         SECTION 2.4.    Adjustment of Conversion Rate...................................................6
         SECTION 2.5.    Notice of Adjustments of Conversion Rate.......................................12
         SECTION 2.6.    Notice of Certain Corporate Action.............................................13
         SECTION 2.7.    Corporation to Reserve Common Stock: Registration; Listing.....................14
         SECTION 2.8.    Taxes on Conversions...........................................................14
         SECTION 2.9.    Covenant as to Common Stock....................................................14
         SECTION 2.10.   Cancellation of Converted Securities...........................................15
         SECTION 2.11.   Provision in Case of Consolidation, Merger or Sale of Assets...................15
         SECTION 2.12.   Responsibility of Trustee for Conversion Provisions............................16
ARTICLE THREE
MISCELLANEOUS...........................................................................................16
         SECTION 3.1.    Discharge of Indenture; Effect of Conversion on Application of Trust Money.....16
         SECTION 3.2.    Effect of Conversion on Trustee's Selection of Convertible Securities to be
                         Redeemed.......................................................................17
         SECTION 3.3.    Notice of Redemption; Additional Requirements..................................17
         SECTION 3.4.    Deposit of Redemption Price; Not Applicable to Converted Securities............17
         SECTION 3.5.    Undertaking for Costs; Not Applicable to Suits to Enforce Right to Convert.....17
         SECTION 3.6.    Conversion Agent; May Hold Securities..........................................17
         SECTION 3.7.    Supplemental Indenture Without Consent of Securityholders; Protection of
                         Securityholder Conversion Right in Consolidation, etc..........................18
         SECTION 3.8.    Ratification of Indenture......................................................18
         SECTION 3.9.    Governing Law..................................................................18
         SECTION 3.10.   Not Responsible for Recitals...................................................18
         SECTION 3.11.   Counterparts...................................................................18
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                  FIRST SUPPLEMENTAL INDENTURE, dated as of January 24, 2003
(hereinafter called the "Supplemental Indenture"), between CONSTELLATION ENERGY
GROUP, INC. a corporation duly organized and existing under the laws of the
State of Maryland (hereinafter sometimes called the "Corporation"), and THE BANK
OF NEW YORK, as Trustee, a New York banking corporation duly organized and
existing under the laws of the State of New York (hereinafter sometimes called
the "Trustee").

                  WHEREAS, the Corporation and the Trustee have heretofore
executed and delivered the Indenture dated as of March 24, 1999 (hereinafter
called the "Indenture"), providing for the issuance from time to time of one or
more series of Securities as defined therein,

                  WHEREAS, the Corporation wishes to supplement the Indenture to
provide for the issuance from time to time of one or more further series of
Securities ("Convertible Securities") convertible into Common Stock, no par
value of the Corporation ("Common Stock"), as hereinafter defined subject to the
terms of the Indenture, as supplemented hereby; and

                  WHEREAS, all things necessary to make this Supplemental
Indenture a valid instrument in accordance with its terms, and to make the
Convertible Securities, when executed by the Corporation and authenticated and
delivered by the Trustee, the valid obligations of the Corporation and all acts
and things necessary have been done and performed to make this Supplemental
Indenture enforceable in accordance with its terms, and the execution and
delivery of this Supplemental Indenture have been duly authorized in all
respects;

                  NOW, THEREFORE, for and in consideration of the premises and
the purchase and acceptance of the Convertible Securities by the holders
thereof, the Corporation covenants and agrees with the Trustee, for the equal
and proportionate benefit of the respective holders from time to time hereafter
of the Convertible Securities, as follows:

ARTICLE ONE DEFINITIONS; GENERAL

                  SECTION 1.1   Certain Additional Terms Defined.

                  In addition to terms defined in the Indenture and terms
defined elsewhere in this Supplemental Indenture, the following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Supplemental Indenture shall have the respective
meanings specified in this Section.

                  "Affiliate" of any specified person means any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person. For the purposes of this definition,
"control", when used with

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respect to any specified person, means the power to direct the management and
policies of such person, directly or indirectly, whether through the ownership
of voting securities, by contract; and the terms "controlling" and "controlled"
have meanings correlative to the foregoing.

                  "Applicable Procedures" means, with respect to any transfer or
transaction involving Convertible Securities of any series issued in global form
or beneficial interest therein, the rules and procedures of the Depositary for
such series, in each case to the extent applicable to such transaction and as in
effect from time to time.

                  "Closing Price Per Share" means, with respect to the Common
Stock, for any day, (i) the last reported sale price regular way on such day or,
if no such sale takes place on such date, the average of the reported closing
bid and asked prices regular way of such Common Stock, in each case on the
principal national securities exchange on which such Common Stock is listed, if
the Common Stock is listed on a national securities exchange, or the National
Market System of the National Association of Securities Dealers, Inc. or, if the
Common Stock is not quoted or admitted to trading on such quotation system, on
the principal quotation system on which the Common Stock is listed or admitted
to trading or quoted, or, if not listed or admitted to trading or quoted on any
national securities exchange or quotation system, the average of the closing bid
and asked prices of the Common Stock in the over-the-counter market on the day
in question as reported by the National Quotation Bureau Incorporated, or a
similarly generally accepted reporting service, or, if not so available in such
manner, as furnished by any New York Stock Exchange member firm selected from
time to time by the Board of Directors of the Corporation for that purpose or,
if not so available in such manner, as otherwise determined in good faith by the
Board of Directors of the Corporation.

                  "Common Stock" means the Common Stock, no par value, of the
Corporation authorized at the date of this instrument as originally executed or
as such stock may be constituted from time to time (including upon a change in
the par value of such securities). Subject to the provisions of Section 2.11 of
this Supplemental Indenture, shares issuable on conversion of Convertible
Securities shall include only shares of Common Stock or shares of any class or
classes of common stock resulting from any reclassification or reclassifications
thereof; provided, however, that if at any time there shall be more than one
such resulting class, the shares so issuable on conversion of Convertible
Securities shall include shares of all such classes, and the shares of each such
class then so issuable shall be substantially in the proportion which the total
number of shares of such class resulting from all such reclassifications bears
to the total number of shares of all such classes resulting from all such
reclassifications.

                  "Conversion Agent" means any person authorized by the
Corporation to convert Convertible Securities in accordance with Article Two
hereof. Unless otherwise specified in or pursuant to the Board Resolution
establishing any series of Convertible Securities, the Corporation initially
appoints the Trustee to act as Conversion Agent.

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                  "Conversion Rate" has the meaning specified in Section 2.1 of
this Supplemental Indenture.

                  "Corporation Request" means a written request or order signed
in the name of the Company by (i) its Chairman of the Board, its President and
Chief Executive Officer, a Vice President or the Treasurer and by (ii) its
principal financial officer, Treasurer, an Assistant Treasurer, its Secretary or
an Assistant Secretary, and delivered to the Trustee.

                  "Outstanding," when used with respect to Convertible
Securities, shall have the same meaning as provided in Section 1.01 of the
Indenture, except that Securities converted into Common Stock pursuant to
Article Two of this Supplemental Indenture shall not be considered Outstanding.

                  "Record Date Period" means the period from the close of
business of any regular record date next preceding any interest payment date to
the opening of business on such interest payment date.

                  "Redemption Date," when used with respect to any Convertible
Security to be redeemed, means the date fixed for such redemption by or pursuant
to Article Four of the Indenture.

                  "Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Corporation or by one or more other Subsidiaries, or by the Corporation and one
or more other Subsidiaries. For the purposes of this definition, "voting stock"
means stock or other similar interests in the corporation which ordinarily has
or have voting power for the election of directors, or persons performing
similar functions, whether at all times or only so long as no senior class of
stock or other interests has or have such voting power by reason of any
contingency.

                  SECTION 1.2   Rules of Construction.

                  Except as otherwise expressly provided for or unless the
context otherwise clearly requires, in addition to the terms defined in Section
1.1 hereof, all terms defined in the Indenture have the same meaning herein as
ascribed to them therein.

                  SECTION 1.3   Authority.

                  This Supplemental Indenture is made pursuant to and in
accordance with Section 11.01 of the Indenture.

                  SECTION 1.4   Notice to Securityholders; Waiver.

                  Except as otherwise expressly provided herein, where this
Supplemental Indenture provides for notice to Securityholders of any event, such
notice shall be

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sufficiently given to Securityholders if in writing and mailed, first-class
postage prepaid, to each Securityholder of a Security affected by such event, at
the address of such Securityholders as it appears in the registry books of the
Corporation, not earlier than the earliest date and not later than the latest
date prescribed for the giving of such notice.

                  Neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Securityholder shall affect the sufficiency
of such notice with respect to other Securityholders. In case by reason of the
suspension of regular mail service or by reason of any other cause it shall be
impracticable to give such notice by mail, then such notification to
Securityholders as shall be made with the approval of the Trustee, which
approval shall not be unreasonably withheld, shall constitute a sufficient
notification to such Securityholders for every purpose hereunder.

                  Such notice shall be deemed to have been given when such
notice is mailed.

                  Where this Supplemental Indenture provides for notice in any
manner, such notice may be waived in writing by the person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Securityholders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.

                      ARTICLE TWO CONVERSION OF SECURITIES

                  SECTION 2.1.  Conversion Privilege and Conversion Rate.

                  Subject to and upon compliance with the provisions of this
Article, at the option of the Securityholder thereof, any Convertible Security
may be converted into fully paid and nonassessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of Common Stock at the Conversion
Rate, determined as hereinafter provided, in effect at the time of conversion.
Such conversion right shall commence for each series of Convertible Securities
at the opening of business on and expire at the close of business on the dates
set forth in or pursuant to the Board Resolution establishing the terms of that
series, and specified in an Officers' Certificate if not so specified in a Board
Resolution, subject, in the case of any Convertible Security issued in global
form, to any Applicable Procedures. In case a Convertible Security or portion
thereof is called for redemption, such conversion right in respect of the
Convertible Security, or portion thereof so called, shall expire at the close of
business on the Business Day immediately preceding the Redemption Date for
Convertible Securities of that series, unless the Corporation defaults in making
the payment due upon redemption (subject as aforesaid to any Applicable
Procedures with respect to Convertible Security issued in global form).

                  Convertible Securities of any series may be converted
initially at a conversion rate (the "Conversion Rate") set forth in or pursuant
to the Board Resolution establishing the terms of that series and specified in
an Officers' Certificate if not so

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specified in a Board Resolution,. The Conversion Rate for each outstanding
series will be adjusted in certain instances as provided in Section 2.4.

                  SECTION 2.2.  Exercise of Conversion Privilege.

                  In order to exercise the conversion privilege, the
Securityholder of any Convertible Security to be converted shall surrender such
Convertible Security, duly endorsed in blank, at any office or agency of the
Corporation maintained for that purpose pursuant to Section 5.2 of the
Indenture, accompanied by a duly signed conversion notice substantially in the
form established by or pursuant to the Board Resolution establishing the terms
of such series stating that the Securityholder elects to convert such Security
or, if less than the entire principal amount thereof is to be converted, the
portion thereof to be converted. Each Convertible Security surrendered for
conversion (in whole or in part) during the Record Date Period (except in the
case of any Convertible Security or portion thereof which has been called for
redemption on a Redemption Date occurring within such Record Date Period and, as
a result, the right to convert such Convertible Security would otherwise
terminate in such period if not exercised) be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Corporation of an amount
equal to the interest payable on such interest payment date on the initial
principal amount of such Convertible Security (or part thereof, as the case may
be) being surrendered for conversion. The interest so payable on such interest
payment date with respect to any Convertible Security (or portion thereof, if
applicable) that is surrendered for conversion during the Record Date Period
shall be paid to the Securityholder of such Convertible Security as of such
regular record date in an amount equal to the interest that would have been
payable on such Convertible Security if such Convertible Security had been
converted as of the close of business on such interest payment date. Interest
payable on any interest payment date in respect of any Convertible Security
surrendered for conversion on or after such interest payment date shall be paid
to the Securityholder of such Convertible Security as of the regular record date
next preceding such interest payment date, notwithstanding the exercise of the
right of conversion. Except as provided in this paragraph, no cash payment or
adjustment shall be made upon any conversion on account of any interest accrued
from the interest payment date next preceding the conversion date, in respect of
any Convertible Security (or part thereof, as the case may be) surrendered for
conversion, or on account of any dividends on the securities issued upon
conversion. The Corporation's delivery to the Securityholder of the number of
shares of Common Stock (and cash in lieu of fractions thereof, as provided in
this Supplemental Indenture) into which a Convertible Security is convertible
will be deemed to satisfy the Corporation's obligation to pay the principal
amount of the Convertible Security.

                  Convertible Securities shall be deemed to have been converted
immediately prior to the close of business on the day of surrender of such
Convertible Securities for conversion in accordance with the foregoing
provisions, and at such time the rights of the Securityholders of such
Convertible Securities as Securityholders shall cease, and the person or persons
entitled to receive the shares of Common Stock issuable

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upon conversion shall be treated for all purposes as the record holder or
holders of such securities at such time. As promptly as practicable on or after
the conversion date, the Corporation shall issue and deliver to the Trustee, for
delivery to the Securityholder (unless a different person is indicated on the
Conversion Notice), a certificate or certificates for the number of full shares
of Common Stock issuable upon conversion, together with payment in lieu of any
fraction of a share, as provided in Section 2.3.

                  In the case of any Convertible Security which is converted in
part only, upon such conversion the Corporation shall execute and the Trustee
shall authenticate and deliver to the Securityholder thereof, at the expense of
the Corporation, a new Convertible Security or Securities of authorized
denominations in an aggregate principal amount equal to the unconverted portion
of the principal amount of such Security. A Security may be converted in part,
but only if the principal amount of such Security to be converted is any
integral multiple of U.S. $1,000 and the principal amount of such security to
remain Outstanding after such conversion is equal to U.S. $1,000 or any integral
multiple of $1,000 in excess thereof.

                  SECTION 2.3.  Fractions of Shares.

                  No fractional shares of Common Stock shall be issued upon
conversion of any Convertible Security or Securities. If more than one
Convertible Security shall be surrendered for conversion at one time by the same
Securityholder, the number of full shares which shall be issuable upon
conversion thereof shall be computed on the basis of the aggregate principal
amount of the Convertible Securities (or specified portions thereof) so
surrendered. Instead of any fractional share of Common Stock that would
otherwise be issuable upon conversion of any Convertible Security or Securities
(or specified portions thereof), the Corporation shall calculate and pay a cash
adjustment in respect of such fraction (calculated to the nearest 1/100th of a
share) in an amount equal to the same fraction of the Closing Price Per Share at
the close of business on the day of conversion.

                  SECTION 2.4.  Adjustment of Conversion Rate.

                  The Conversion Rate shall be subject to adjustments from time
to time as follows:

                  (1)  In case the Corporation shall pay or make a dividend or
other distribution on shares of any class of capital stock payable in shares of
Common Stock, the Conversion Rate in effect at the opening of business on the
day following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be increased by dividing the
Conversion Rate in effect immediately prior to such date by a fraction:

                      (i)  the numerator of which shall be the number of
                           shares of Common Stock outstanding at the close of
                           business on the date fixed for such determination and

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                      (ii) the denominator shall be the sum of such number of
                           shares and the total number of shares constituting
                           such dividend or other distribution.

                  Such increase will become effective immediately after the
opening of business on the day following the date fixed for such determination.
If, after any such date fixed for determination, any dividend or distribution is
not in fact paid, the Conversion Rate shall be immediately readjusted, effective
as of the date the Board of Directors determines not to pay such dividend or
distribution, to the Conversion Rate that would have been in effect if such
determination date had not been fixed. For the purposes of this paragraph (1),
the number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Corporation but shall include shares issuable
in respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. The Corporation will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Corporation.

                  (2)  Subject to the last sentence of paragraph (7) of this
Section 2.4, in case the Corporation shall issue rights, options or warrants to
all holders of its Common Stock entitling them to subscribe for or purchase
shares of Common Stock at a price per share less than the current market price
per share (determined as provided in paragraph (8) of this Section 2.4) of the
Common Stock on the date fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than any rights, options or
warrants that by their terms will also be issued to any Securityholder upon
conversion of a Convertible Security into shares of Common Stock without any
action required by the Corporation or any other person), the Conversion Rate in
effect at the opening of business on the day following the date fixed for such
determination shall be increased by dividing the Conversion Rate in effect
immediately prior to such date by a fraction:

                      (i)    the numerator of which will be the number of shares
                           of Common Stock outstanding at the close of business
                           on the date fixed for such determination plus the
                           number of shares of Common Stock that the aggregate
                           of the offering price of the total number of shares
                           of Common Stock so offered for subscription or
                           purchase would purchase at such current market price
                           and

                      (ii)   the denominator shall be the number of shares of
                           Common Stock outstanding at the close of business on
                           the date fixed for such determination plus the number
                           of shares of Common Stock so offered for subscription
                           or purchase.

                  Such increase will become effective immediately after the
opening of business on the day following the date fixed for such determination.
If, after any such date fixed for determination, any such rights, options or
warrants are not in fact issued, or are not exercised prior to the expiration
thereof, the Conversion Rate shall be

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immediately readjusted, effective as of the date such rights, options or
warrants expire, or the date the Board of Directors determines not to issue such
rights, options or warrants, to the Conversion Rate that would have been in
effect if the unexercised rights, options or warrants had never been granted or
such determination date had not been fixed, as the case may be. For the purposes
of this paragraph (2), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Corporation but
shall include shares issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock. The Corporation will not issue any rights,
options or warrants in respect of shares of Common Stock held in the treasury of
the Corporation.

                  (3)  In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the Conversion Rate
in effect at the opening of business on the day following the day upon which
such subdivision becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall be combined into a
smaller number of shares of Common Stock, the Conversion Rate in effect at the
opening of business on the day following the day upon which such combination
becomes effective shall be proportionately reduced, such increase or reduction,
as the case may be, to become effective immediately after the opening of
business on the day following the day upon which such subdivision or combination
becomes effective.

                  (4)  Subject to the last sentence of paragraph (7) of this
Section 2.4, in case the Corporation shall, by dividend or otherwise, distribute
to all holders of its Common Stock evidences of its indebtedness, shares of any
class of capital stock or rights, options or warrants to subscribe for or
purchase shares of any class of capital stock (other than any rights, options or
warrants that by their terms will also be issued to any Securityholder upon
conversion of a Convertible Security into shares of Common Stock without any
action required by the Corporation or any other person) or other property
(including cash or assets or securities, but excluding (i) any rights, options
or warrants referred to in paragraph (2) of this Section, (ii) any dividend or
distribution paid exclusively in cash, other than those referred to in
paragraphs (5) and (6) below, (iii) any dividend or distribution referred to in
paragraph (1) of this Section and (iv) any consideration distributed in any
merger or consolidation to which Section 2.11 applies), the Conversion Rate
shall be adjusted so that the same shall equal the rate determined by dividing
the Conversion Rate in effect immediately prior to the close of business on the
date fixed for the determination of stockholders entitled to receive such
distribution by a fraction:

                      (i)    the numerator of which will be the current market
                           price per share (determined as provided in paragraph
                           (8) of this Section 2.4) of the Common Stock on the
                           date fixed for such determination less the then fair
                           market value (as determined by the Board of
                           Directors, whose determination shall be conclusive
                           and described in a Board Resolution filed with the
                           Trustee) of the portion of the

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                           assets, shares or evidences of indebtedness so
                           distributed applicable to one share of Common Stock
                           and

                      (ii)   the denominator shall be such current market price
                           per share of the Common Stock.

                  Such adjustment will become effective immediately prior to the
opening of business on the day following the date fixed for the determination of
stockholders entitled to receive such distribution. If after any such date fixed
for determination, any such distribution is not in fact made, the Conversion
Rate shall be immediately readjusted, effective as of the date that the Board of
Directors determines not to make such distribution, to the Conversion Rate that
would have been in effect if such determination date had not been fixed.

                  (5)  In case the Corporation shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding cash distributed
upon a merger or consolidation to which Section 2.11 applies) in an aggregate
amount that, combined together with (I) the aggregate amount of any other
all-cash distributions to all holders of its Common Stock made exclusively in
cash within the 365-day period preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to this paragraph
(5) or paragraph (6) of this Section 2.4 has been made and (II) the aggregate of
any cash plus the fair market value (as determined by the Board of Directors,
whose determination shall be conclusive and described in a Board Resolution) of
any non-cash consideration payable in respect of any tender offer by the
Corporation or any of its Subsidiaries for all or any portion of the Common
Stock concluded within the 365-day period preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to paragraph (6) of
this Section 2.4 has been made (the "combined cash and tender amount") exceeds
10% of the product of the current market price per share (determined as provided
in paragraph (8) of this Section 2.4) of the Common Stock on the date for the
determination of holders of shares of Common Stock entitled to receive such
distribution times the number of shares of Common Stock outstanding on such date
(the "aggregate current market price"), then, and in each such case, immediately
after the close of business on such date for determination, the Conversion Rate
shall be adjusted so that the same shall equal the rate determined by dividing
the Conversion Rate in effect immediately prior to the close of business on the
date fixed for determination of the stockholders entitled to receive such
distribution by a fraction:

                      (i)    the numerator of which shall be equal to the
                           current market price per share (determined as
                           provided in paragraph (8) of this Section 2.4) of the
                           Common Stock on the date fixed for such determination
                           less an amount equal to the quotient of (x) the
                           excess of such combined cash and tender amount over
                           10% of such aggregate current market price divided by
                           (y) the number of shares of Common Stock outstanding
                           on such date for determination and

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                      (ii)   the denominator of which shall be equal to the
                           current market price per share (determined as
                           provided in paragraph (8) of this Section 2.4) of the
                           Common Stock on such date fixed for determination.

                  (6)  In case a tender offer made by the Corporation or any
Subsidiary for all or any portion of the Common Stock shall expire and such
tender offer (as amended upon the expiration thereof) shall require the payment
to stockholders (based on the acceptance (up to any maximum specified in the
terms of the tender offer) of Purchased Shares (as defined below)) of an
aggregate consideration having a fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a Board
Resolution) that combined together with (I) the aggregate of the cash plus the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution), as of the expiration
of such tender offer, of any non-cash consideration payable in respect of any
other tender offer by the Corporation or any Subsidiary for all or any portion
of the Common Stock expiring within the 365-day period preceding the expiration
of such tender offer and in respect of which no adjustment pursuant to this
paragraph (6) or paragraph (5) of this Section 2.4 has been made and (II) the
aggregate amount of any cash distributions to all holders of the Common Stock
within 365-day period preceding the expiration of such tender offer and in
respect of which no adjustment pursuant to paragraph (5) of this Section 2.4 has
been made (the "combined tender and cash amount") exceeds 10% of the product of
the current market price per share of the Common Stock (determined as provided
in paragraph (8) of this Section 2.4) as of the last time (the "Expiration
Time") tenders could have been made pursuant to such tender offer (as it may be
amended) times the number of shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time, then, and in each such case
immediately prior to the opening of business on the day after the date of the
Expiration Time, the Conversion Rate shall be adjusted so that the same shall
equal the rate determined by dividing the Conversion Rate immediately prior to
the close of business on the date of the Expiration Time by a fraction

                      (i)    the numerator of which shall be equal to (A) the
                           product of (I) the current market price per share of
                           the Common Stock (determined as provided in paragraph
                           (8) of this Section 2.4) on the date of the
                           Expiration Time multiplied by (II) the number of
                           shares of Common Stock outstanding (including any
                           tendered shares) on the date of the Expiration Time
                           less (B) the combined tender and cash amount, and

                      (ii)   the denominator of which shall be equal to the
                           product of (A) the current market price per share of
                           the Common Stock (determined as provided in paragraph
                           (8) of this Section 2.4) on the date of the
                           Expiration Time multiplied by (B) the number of
                           shares of Common Stock outstanding (including any
                           tendered shares) as

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                           of the Expiration Time less the number of all shares
                           validly tendered and not withdrawn as of the
                           Expiration Time (the shares deemed so accepted up to
                           any such maximum, being referred to as the "Purchased
                           Shares").

                  (7)  The reclassification of Common Stock into securities
other than Common Stock (other than any reclassification upon a consolidation or
merger to which Section 2.11 applies) shall be deemed to involve (a) a
distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be
"the date fixed for the determination of stockholders entitled to receive such
distribution" and "the date fixed for such determination" within the meaning of
paragraph (4) of this Section 2.4), and (b) a subdivision or combination, as the
case may be, of the number of shares of Common Stock outstanding immediately
prior to such reclassification into the number of shares of Common Stock
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such subdivision
becomes effective" or "the day upon which such combination becomes effective,"
as the case may be, and "the day upon which such subdivision or combination
becomes effective" within the meaning of paragraph (3) of this Section 2.4).
Rights, options or warrants issued by the Corporation to all holders of its
Common Stock entitling the holders thereof to subscribe for or purchase shares
of capital stock of the Corporation, which rights, options or warrants (i) are
deemed to be transferred with such shares of Common Stock, (ii) are not
exercisable and (iii) are also issued in respect of future issuances of shares
of capital stock, in each case in clauses (i) through (iii) until the occurrence
of a specified event or events ("Trigger Event"), shall for purposes of this
Section 2.4 not be deemed issued or distributed until the occurrence of the
earliest Trigger Event.

                  (8)  For the purpose of any computation under paragraphs (2),
(4), (5) or (6) of this Section 2.4, the current market price per share of
Common Stock on any date shall be calculated by the Corporation and be the
average of the daily Closing Prices Per Share for the five consecutive Trading
Days selected by the Corporation commencing not more than 10 Trading Days
before, and ending not later than the earlier of the day in question and the day
before the "ex date" with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "ex date," when used with
respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way in the applicable securities market or on the
applicable securities exchange without the right to receive such issuance or
distribution.

                  (9)  No adjustment in the Conversion Rate shall be required
unless such adjustment (plus any adjustments not previously made by reason of
this paragraph (9)) would require an increase or decrease of at least one
percent in such rate; provided, however, that any adjustments which by reason of
this paragraph (9) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
Article shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.

                                       11

<PAGE>

                  (10) The Corporation may make such increases in the Conversion
Rate, for the remaining term of the Securities or any shorter term, in addition
to those required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section
2.4, as it considers to be advisable in order to avoid or diminish any income
tax to any holders of shares of Common Stock resulting from any dividend or
distribution of stock or issuance of rights or warrants to purchase or subscribe
for stock or from any event treated as such for income tax purposes. The
Corporation shall have the power to resolve any ambiguity or correct any error
in this paragraph (10) and its actions in so doing shall, absent manifest error,
be final and conclusive.

                  (11) Notwithstanding the foregoing provisions of this Section,
no adjustment of the Conversion Rate shall be required to be made (a) upon the
issuance of shares of Common Stock pursuant to any present or future plan for
the reinvestment of dividends, (b) upon a change in the par value of the Common
Stock or (c) because of a tender or exchange offer of the character described in
Rule 13e-4(h)(5) under the Securities Exchange Act of 1934, as amended, or any
successor rule thereto.

                  (12) To the extent permitted by applicable law, the
Corporation from time to time may increase the Conversion Rate by any amount for
any period of time if the period is at least 20 days, the increase is
irrevocable during such period, and the Board of Directors shall have made a
determination that such increase would be in the best interests of the
Corporation, which determination shall be conclusive. Whenever the Conversion
Rate is increased pursuant to the preceding sentence, the Corporation shall give
notice of the increase to the Securityholders in the manner provided in Section
1.4 hereof at least 15 days prior to the date the increased Conversion Rate
takes effect, and such notice shall state the increased Conversion Rate and the
period during which it will be in effect.

                  SECTION 2.5.  Notice of Adjustments of Conversion Rate.

                  Whenever the Conversion Rate is adjusted as herein provided:

                  (1)  the Corporation shall compute the adjusted Conversion
Rate in accordance with Section 2.4 hereof and shall prepare a certificate
signed by the Chief Financial Officer or Treasurer of the Corporation setting
forth the adjusted Conversion Rate and showing in reasonable detail the facts
upon which such adjustment is based, and such certificate shall promptly be
filed with the Trustee and with each Conversion Agent; and

                  (2)  upon each such adjustment, a notice stating that the
Conversion Rate has been adjusted and setting forth the adjusted Conversion Rate
shall be required, and as soon as practicable after it is required, such notice
shall be provided by the Corporation to all Securityholders of Convertible
Securities in accordance with Section 1.4.

                  Neither the Trustee nor any Conversion Agent shall be under
any duty or responsibility with respect to any such certificate or the
information and calculations

                                       12

<PAGE>

contained therein, except to exhibit the same to any holder of Securities
desiring inspection thereof at its office during normal business hours, and
shall not be deemed to have knowledge of any adjustment in the Conversion Rate
unless and until a Responsible Officer of the Trustee shall have received such a
certificate. Until a Responsible Officer of the Trustee receives such a
certificate, the Trustee and each Conversion Agent may assume without inquiry
that the last Conversion Rate of which the Trustee has knowledge remains in
effect.

                  SECTION 2.6.  Notice of Certain Corporate Action.

                  In case:

                  (1)  the Corporation shall declare a dividend (or any other
distribution) on its Common Stock payable (i) otherwise than exclusively in cash
or (ii) exclusively in cash in an amount that would require any adjustment
pursuant to Section 2.4; or

                  (2)  the Corporation shall authorize the granting to all or
substantially all of the holders of its Common Stock of rights, options or
warrants to subscribe for or purchase any shares of capital stock of any class
or of any other rights; or

                  (3)  of any reclassification of the Common Stock, or of any
consolidation, merger or share exchange to which the Corporation is a party and
for which approval of any stockholders of the Corporation is required, or of the
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Corporation; or

                  (4)  of the voluntary or involuntary dissolution, liquidation
or winding up of the Corporation;

then the Corporation shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 5.2 of the
Indenture, and shall cause to be provided to all Securityholders in accordance
with Section 1.4 hereof, at least 20 days (or 10 days in any case specified in
clause (1) or (2) above) prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be
taken for the purpose of such dividend, distribution, rights, options or
warrants, or, if a record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such dividend, distribution, rights,
options or warrants are to be determined or (y) the date on which such
reclassification, consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for securities, cash or other
property deliverable upon such reclassification, consolidation, merger,
conveyance, transfer, sale, lease, dissolution, liquidation or winding up.
Neither the failure to give such notice or the notice referred to in the
following paragraph nor any defect therein shall affect the legality or validity
of the proceedings described in clauses (1) through (4) of this Section 2.6. If
at the time the

                                       13

<PAGE>

Trustee shall not be the Conversion Agent, a copy of such notice shall also
forthwith be filed by the Corporation with the Trustee.

                  The Corporation shall cause to be filed at the principal
office of the Trustee and each office or agency maintained for the purpose of
conversion of Convertible Securities pursuant to Section 5.02 of the Indenture,
and shall cause to be provided to all Securityholders in accordance with Section
1.4, notice of any tender offer by the Corporation or any Subsidiary for all or
any portion of the Common Stock at or about the time that such notice of tender
offer is provided to the public generally.

                  SECTION 2.7.  Corporation to Reserve Common Stock;
Registration; Listing.

                  (1)  The Corporation shall at all times reserve and keep
available, free from preemptive rights, out of its authorized but unissued
Common Stock, for the purpose of effecting the conversion of Convertible
Securities, the full number of shares of Common Stock then issuable upon the
conversion of all Outstanding Convertible Securities.

                  (2)  The Corporation covenants that so long as the Common
Stock shall be listed on the NYSE, the Corporation will, if permitted by the
rules of such exchange, list and keep listed all Common Stock issuable upon
conversion of the Convertible Securities, and the Corporation will endeavor to
list the shares of Common Stock required to be delivered upon conversion of the
Convertible Securities prior to such delivery upon any other national securities
exchange upon which the outstanding Common Stock is listed at the time of such
delivery.

                  SECTION 2.8.  Taxes on Conversions.

                  Except as provided in the next sentence, the Corporation will
pay all stamp taxes and other duties that may be payable in respect of the issue
or delivery of shares of Common Stock on conversion of Convertible Securities
pursuant hereto. The Corporation shall not, however, be required to pay any tax
or duty that may be payable in respect of (i) income of the Securityholder, or
(ii) any transfer involved in the issue and delivery of shares of Common Stock
in a name other than that of the Securityholder of the Convertible Security or
Securities to be converted, and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Corporation the
amount of any such tax or duty, or has established to the satisfaction of the
Corporation that such tax or duty has been paid.

                  SECTION 2.9.  Covenant as to Common Stock.

                  The Corporation agrees that all shares of Common Stock that
may be delivered upon conversion of Convertible Securities, upon such delivery,
will have been duly authorized and validly issued and will be fully paid and
nonassessable and, except as provided in Section 2.8 hereof, the Corporation
will pay all taxes, liens and charges with respect to the issue thereof.

                                       14

<PAGE>

                  SECTION 2.10. Cancellation of Converted Securities.

                  All Convertible Securities delivered for conversion shall be
delivered to the Trustee or its agent to be canceled by or at the direction of
the Trustee, which shall dispose of the same as provided in Section 3.07 of the
Indenture.

                  SECTION 2.11. Provision in Case of Consolidation, Merger or
Sale of Assets.

                  In case of any consolidation or merger of the Corporation with
or into any other person or any merger of another person with or into the
Corporation (other than a merger that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock ) or
any conveyance, sale, transfer or lease of all or substantially all of the
assets of the Corporation (other than a sale of all or substantially all of the
assets of the Corporation that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock), the
person formed by such consolidation or resulting from such merger or which
acquires such assets, as the case may be, shall execute and deliver to the
Trustee a supplemental indenture providing that the Securityholder of each
Convertible Security then Outstanding shall have the right thereafter, during
the period such Convertible Security shall be convertible as specified in
Section 2.1 hereof, to convert such Convertible Security only into the kind and
amount of securities, cash and other property receivable upon such
consolidation, merger, conveyance, sale, transfer or lease by a holder of the
number of shares of Common Stock into which such Convertible Security might have
been converted immediately prior to such consolidation, merger, conveyance,
sale, transfer or lease, assuming such holder of Common Stock (i) is not (A) a
person with which the Corporation consolidated or merged with or into or which
merged into or with the Corporation or to which such conveyance, sale, transfer
or lease was made, as the case may be (a "Constituent Person"), or (B) an
Affiliate of a Constituent Person and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer
or lease (provided that if the kind or amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer,
or lease is not the same for each share of Common Stock held immediately prior
to such consolidation, merger, conveyance, sale, transfer or lease by others
than a Constituent Person or an Affiliate thereof and in respect of which such
rights of election shall not have been exercised ("Non-electing Share"), then
for the purpose of this Section 2.11 the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer or lease by the holders of each Non-electing Share shall be deemed to
be the kind and amount so receivable per share by a plurality of the
Non-electing Shares). Such supplemental indenture shall provide for adjustments
that, for events subsequent to the effective date of such supplemental
indenture, shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article. The above provisions of this Section
2.11 shall similarly apply to successive consolidations, mergers, conveyances,
sales, transfers or leases.

                                       15

<PAGE>

                  Notice of the execution of such a supplemental indenture shall
be given by the Corporation to the Securityholder of each Convertible Security
as provided in Section 1.4 hereof promptly upon such execution.

                  Neither the Trustee nor any Conversion Agent shall be under
any responsibility to determine the correctness of any provisions contained in
any such supplemental indenture relating either to the kind or amount of shares
of stock or other securities or property or cash receivable by Securityholders
upon the conversion of their Convertible Securities after any such
consolidation, merger, conveyance, transfer, sale or lease or to any such
adjustment, but may accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, an Officers' Certificate or
an Opinion of Counsel with respect thereto, which the Corporation shall cause to
be furnished to the Trustee upon request.

                  SECTION 2.12. Responsibility of Trustee for Conversion
Provisions.

                  The Trustee, subject to the provisions of Section 8.01 of the
Indenture, and any Conversion Agent shall not at any time be under any duty or
responsibility to any Securityholder to determine whether any facts exist which
may require any adjustment of the Conversion Rate, or with respect to the nature
or extent of any such adjustment when made, or with respect to the method
employed, herein or in any supplemental indenture provided to be employed, in
making the same, or whether a supplemental indenture need be entered into.
Neither the Trustee, subject to the provisions of Section 8.01 of the Indenture,
nor any Conversion Agent shall be accountable with respect to the validity or
value (or the kind or amount) of any Common Stock, or of any other securities or
property or cash, which may at any time be issued or delivered upon the
conversion of any Convertible Security; and it or they do not make any
representation with respect thereto. Neither the Trustee, subject to the
provisions of Section 8.1 of the Indenture, nor any Conversion Agent shall be
responsible for any failure of the Corporation to make or calculate any cash
payment or to issue, transfer or deliver any shares of Common Stock or share
certificates or other securities or property or cash upon the surrender of any
Security for the purpose of conversion; and the Trustee, subject to the
provisions of Section 8.01 of the Indenture, and any Conversion Agent shall not
be responsible for any failure of the Corporation to comply with any of the
covenants of the Corporation contained in this Article.

                          ARTICLE THREE MISCELLANEOUS

                  SECTION 3.1.  Discharge of Indenture; Effect of Conversion on
Application of Trust Money.

                  All moneys deposited with the Trustee pursuant to Section
13.01 of the Indenture (and held by it or any paying agent) for the payment of
Convertible Securities subsequently converted will be returned to the
Corporation upon Corporation Request.

                                       16

<PAGE>

                  SECTION 3.2.  Effect of Conversion on Trustee's Selection of
Convertible Securities to be Redeemed.

                  If any Convertible Security selected for partial redemption by
the Trustee pursuant to Section 4.03 of the Indenture is converted in part
before termination of the conversion right with respect to the portion of the
Convertible Security so selected, the converted portion of such Convertible
Security will be deemed (so far as may be) to be the portion selected for
redemption. Convertible Securities which have been converted during a selection
of Convertible Securities to be redeemed may be treated by the Trustee as
Outstanding for the purpose of such Conversion.

                  SECTION 3.3.  Notice of Redemption; Additional Requirements.

                  In addition to the requirements provided by Section 4.04 of
the Indenture, each notice of redemption with respect to Convertible Securities
of each series to be redeemed must state the Conversion Rate, the date on which
the right to convert the Convertible Securities to be redeemed will terminate
and the places where such Convertible Securities may be surrendered for
conversion.

                  SECTION 3.4.  Deposit of Redemption Price; Not Applicable to
Converted Securities.

                  When the Corporation deposits the redemption price of
Securities called for redemption with the Trustee or paying agent on or prior to
the redemption date as required by Section 4.05 of the Indenture, the
Corporation will not deposit the redemption price of those Convertible
Securities called for redemption which have been converted prior to the date of
deposit.

                  If any Convertible Security called for redemption is
converted, any money deposited with the Trustee or so segregated and held in
trust for the redemption of such Convertible Security shall be paid to the
Corporation on Corporation Request.

                  SECTION 3.5.  Undertaking for Costs; Not Applicable to Suits
to Enforce Right to Convert.

                  The provisions of Section 7.09 of the Indenture will not apply
to any suit instituted by a Securityholder for the enforcement of the right to
convert any Convertible Security in accordance with Article Two of this
Supplemental Indenture.

                  SECTION 3.6.  Conversion Agent; May Hold Securities.

                  The Conversion Agent, in its individual or any other capacity,
may become the owner or pledgee of Convertible Securities and may otherwise deal
with the Corporation with the same rights it would have if it were not the
Conversion Agent.

                                       17

<PAGE>

                  SECTION 3.7.  Supplemental Indenture Without Consent of
Securityholders; Protection of Securityholder Conversion Right in Consolidation,
etc.

                  The Corporation, when authorized by a resolution of the Board
of Directors, and the Trustee may enter into an indenture or indenture
supplemental to the Indenture for the purpose of making provisions with respect
to the conversion rights of Securityholders pursuant to Section 2.11 of this
Supplemental Indenture without the consent of the Securityholders.

                  SECTION 3.8.  Ratification of Indenture.

                  The Indenture, as supplemented by this Supplemental Indenture,
is in all respects ratified and confirmed, and this Supplemental Indenture shall
be deemed part of the Indenture in the manner and to the extent herein and
therein provided.

                  SECTION 3.9.  Governing Law.

                  This Supplemental Indenture and each Convertible Security
shall be deemed to be a contract made under the laws of the State of New York,
and for all purposes shall be governed by and construed in accordance with the
laws of said State.\

                  SECTION 3.10. Not Responsible for Recitals.

                  The recitals contained in this Supplemental Indenture and the
Securities, except the Trustee's certificate of authentication, shall be taken
as the statements of the Corporation and the Trustee assumes no responsibility
for their correctness and makes no representation as to the validity or
sufficiency of this Supplemental Indenture, of the Convertible Securities or of
the Common Stock issuable upon conversion of the Convertible Securities.

                  SECTION 3.11. Counterparts.

                  This Supplemental Indenture may be executed in two
counterparts each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.

                                       18

<PAGE>

                  IN WITNESS WHEREOF, Constellation Energy Group has caused this
Supplemental Indenture to be signed in its corporate name by one of its Vice
Presidents and The Bank of New York, Trustee, has caused this Supplemental
Indenture to be signed by one of its authorized signatories, as of the day and
year first written above.

                                         CONSTELLATION ENERGY GROUP, INC.

                                    By:  /s/ T. E. Ruszin, Jr.
                                       ---------------------------------
                                         Name:  Thomas E. Ruszin, Jr.
                                         Title: Vice President,
                                                 Treasurer and Assistant
                                                 Secretary

                                         THE BANK OF NEW YORK, as Trustee

                                         By:  /s/ Geovanni Barris
                                            ----------------------------
                                         Name:  Geovanni Barris
                                         Title: Vice President<PAGE>

                                                                    EXHIBIT 4(E)

                                WARRANT AGREEMENT

     WARRANT AGREEMENT, dated as of [ ], among Constellation Energy Group, Inc.
(the "Company") and The Bank of New York, as warrant agent (the "Warrant
Agent").

     WHEREAS, on [ ] the Company filed with the Securities and Exchange
Commission a "shelf" registration statement on Form S-3. Under this registration
statement the Company is authorized, inter alia, to issue, from time to time,
warrants to purchase senior debt securities, convertible debt securities,
preferred stock and common stock or any combination of these securities. On [ ],
the Company resolved to issue warrants to purchase [indicate type of securities]
(the "Warrants"). The term "[ ]" as used in this Agreement refers to the [ ]
[indicate type of securities] that the Company will issue and deliver upon
exercise of the Warrants in accordance with the terms and conditions set forth
in the warrant certificates evidencing the Warrants (the "Warrant
Certificates"), such Warrant Certificates to be substantially in the form of
Exhibit A hereto; and

     WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is so willing to act, in connection with the
issuance, exchange, transfer, exercise and replacement of the Warrant
Certificates, and in this Agreement wishes to set forth, among other things, the
form and provisions of the Warrant Certificates (including the Global Warrant
Certificates) and the terms and conditions on which they may be issued,
exchanged, transferred, exercised and replaced.

     NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the parties agree to their following respective
obligations and rights:

     1.   Issuance of Warrants and Execution and Delivery of Warrant
Certificates.

     (a) All Warrant Certificates shall be in registered form, shall
contain such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Agreement and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements placed thereon as may, consistently herewith, be
determined by a duly authorized representative of the Company (each, an
"Authorized Person"), as evidenced conclusively by the execution of such Warrant
Certificates and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any law or with any rule or regulation.

     (b)  The Warrant Agent shall, upon receipt of the Warrant Certificates duly
executed on behalf of the Company, countersign one or more global warrant
certificates (the "Global Warrant Certificates") evidencing the Warrants and
shall, subject to

<PAGE>

paragraph (a) above, deliver such Global Warrant Certificates to or upon the
written order of the Company. Subsequent to such original issuance of the
Warrant Certificates, the Warrant Agent shall countersign Warrant Certificates
only if such Warrant Certificates are issued in exchange or substitution for one
or more previously countersigned Warrant Certificates, as the case may be, or,
in connection with their transfer, as hereinafter provided or as provided in
Section 6(a) or Section 18, but subject to the provisions of Section 7. A Global
Warrant Certificate shall be, and shall remain, subject to the provisions of
this Agreement until such time as all of the Warrants evidenced thereby shall
have been duly exercised or shall have expired or been canceled in accordance
with the terms thereof.

     No Warrant Certificate shall be valid for any purpose, and no Warrant
evidenced thereby shall be exercisable, until such Warrant Certificate has been
countersigned by the manual signature of the Warrant Agent. Such signature by
the Warrant Agent upon any Warrant Certificate executed by the Company shall be
conclusive evidence that such Warrant Certificate so countersigned has been duly
issued hereunder.

     (c)  Each Warrant Certificate shall be signed on behalf of the Company by
an Authorized Person. Such signature may be the manual or facsimile signature of
such persons and may be imprinted or otherwise reproduced on the Warrant
Certificates.

     In case any Authorized Person who shall have signed any of the Warrant
Certificates either manually or by facsimile signature shall cease to be an
Authorized Person, before the Warrant Certificates shall have been countersigned
and delivered by the Warrant Agent, such Warrant Certificates may be
countersigned and delivered notwithstanding that a person who signed such
Warrant Certificate ceased to be such an Authorized Person, and any Warrant
Certificate may be signed on behalf of the Company by such persons as, at the
actual date of the execution of such Warrant Certificate, shall be Authorized
Persons, although at the date of the execution of this Agreement any such person
was not such an Authorized Person.

     The terms "holder", "Warrant holder" or "holder of a Warrant Certificate"
as used herein shall mean any person in whose name at the time any Warrant
Certificate shall be registered upon the books to be maintained by the Warrant
Agent for that purpose.

     2.   Appointment of the Warrant Agent. The Company hereby appoints The Bank
of New York as Warrant Agent of the Company in respect of the Warrants and
Warrant Certificates, upon the terms and subject to the conditions set forth
herein and in the Warrant Certificates, and The Bank of New York hereby accepts
such appointment. The Warrant Agent shall have the powers and authority granted
to and conferred upon it herein and in the Warrant Certificates and such further
powers and authority, acceptable to it, to act on behalf of the Company as the
Company may hereafter grant to or confer upon it. All the terms and provisions
with respect to such powers and authority contained in the Warrant Certificates
are subject to and governed by the terms and provisions hereof. The Company
agrees, for the benefit of the holders from time to time of the

                                       -2-

<PAGE>

Warrant Certificates, that there shall at all times be a Warrant Agent hereunder
until the Warrants expire.

     3.   Exercise of Warrants. (a) Each Warrant entitles the registered owner
to exercise an option to purchase, at an exercise price of $[ ], U.S. $[ ] of
[  ] [indicate type of securities].

     (b)  The Warrants evidenced by a Warrant Certificate may be exercised in
whole or in part not earlier than [9:00 A.M., New York City time,] on [ ] and
[not later than 5:00 P.M., New York City time,] on [ ]. If a Warrant is not
exercised at or before [5:00 P.M., New York City time,] on [ ], it shall become
void, and all rights of the holder under Warrants and under this Agreement shall
cease. [No fewer than one Warrant may be exercised per Warrant Exercise Notice
(as defined below) and no fractional Warrants may be exercised.]

     (c)  During the period specified in Section 3(b), a Warrant, if the Warrant
Certificate evidencing the same shall have been countersigned by the Warrant
Agent, may be exercised by the holder thereof by (i) providing written notice of
such election ("Warrant Exercise Notice") to exercise the Warrant to the Warrant
Agent at [ ], "Attention: Constellation Energy Group, Inc. Warrant Exercise", or
to such other address as shall be notified in accordance with the immediately
following paragraph, by hand or by facsimile, no later than [noon, New York City
time,] on [ ], which Warrant Exercise Notice shall be in the form of an election
to purchase [ ] [indicate type of securities] substantially in the form set
forth in Exhibit B hereto, properly completed and executed by the holder;
provided that such written notice may only be submitted by or through persons
that are direct participants in The Depository Trust Company ("DTC"); (ii)
delivering, no later than [noon, New York City time,] on the Warrant Exercise
Date, such Warrants to the Warrant Agent by book-entry transfer through the
facilities of DTC or by delivering, no later than [noon, New York City time,] on
[ ], the Warrant Certificates evidencing such Warrants to the Warrant Agent if
Warrant Certificates in definitive form have been issued and delivered pursuant
to Section 7; and (iii) for each Warrant exercised, paying in full, in lawful
money of the United States of America, by bank wire transfer in immediately
available funds [add electronic payment details] no later than [11:00 A.M., New
York City time] on [ ] (the "Settlement Date"), the exercise price of U.S. $[ ].
Any exercise of a Warrant pursuant to the terms of this paragraph (c) shall be
irrevocable and shall constitute a binding agreement between the Warrant holder
and the Company, enforceable in accordance with its terms.

     (d)  Not less than 20 days before the start of the period specified in
Section 3(b), the Warrant Agent shall notify DTC of (x) the Warrant Agent's
account at DTC to which the Warrants must be delivered on the Warrant Exercise
Date and (y) the address, phone number and facsimile number where holders of the
Warrants can contact the Warrant Agent to which Warrant Exercise Notices are to
be submitted.

                                       -3-

<PAGE>

     (e)  Approximately two weeks before the start of the period specified in
Section 3(b), the Warrant Agent shall notify holders (through the clearing
system) of (1) the Warrant Agent's account at DTC to which holders must deliver
Warrants on the Warrant Exercise Date, (2) the Warrant exercise procedures of
DTC and (3) the address, telephone number and facsimile number where holders can
contact the Warrant Agent and to which holders must submit Warrant Exercise
Notices if they decide to exercise their Warrants. At such time, the Warrant
Agent shall also provide the holders with a Warrant Exercise Notice and the
pertinent instructions as to how to exercise their Warrants.

     (f)  [Further, at any time until the start of the period specified in
Section 3(b), the Warrant Agent shall provide [ ] (the "Dealer Manager"), which
has been appointed by the Company as dealer manager to solicit holders of
Warrants to exercise the Warrants, such information regarding the registered
owners of the Warrants as the Dealer Manager may reasonably request and is
reasonably available to the Warrant Agent, including a list of all registered
owners of the Warrants known to the Warrant Agent.]

     (g)  The Warrant Agent shall:

               (i)   examine all Warrant Exercise Notices and all other
          documents delivered to it by or on behalf of holders as contemplated
          by the Warrant Certificates to ascertain whether, on their face, such
          Warrant Exercise Notices and any such other documents have been
          executed and completed in accordance with their terms and the terms of
          the Warrant Certificates;

               (ii)  determine whether the exercising Warrant holder has
          delivered the related Warrants to the Warrant Agent's account at DTC.
          In each case where a Warrant Exercise Notice or other document appears
          on its face to have been improperly completed or executed or some
          other irregularity in connection with the exercise of the Warrants
          exists, the Warrant Agent will endeavor to inform the appropriate
          parties (including the person submitting such instrument) of the need
          for fulfillment of all requirements, specifying those requirements
          which appear to be unfulfilled. Except to the extent provided in the
          immediately preceding sentence, the Warrant Agent shall be under no
          duty to give notice to any person of any irregularities in Warrant
          Exercise Notices, delivery of Warrants or any other document completed
          or executed in connection therewith nor shall it incur any liability
          for failure to give such notice;

               (iii) inform the Company of and cooperate with and assist the
          Company in resolving any reconciliation problems between Warrant
          Exercise Notices received and delivery of Warrants to the Warrant
          Agent's account;

                                       -4-

<PAGE>

               (iv)  advise the Company (i) no later than [noon, New York City
          time, on the first New York business day following the expiration of
          the period specified in Section 3(b),] of receipt of any Warrant
          Exercise Notices and the number of Warrants exercised in accordance
          with the terms and conditions of this Agreement, (ii) no later than
          [noon, New York City time, on the second New York business day, as
          applicable, following the expiration of the period specified in
          Section 3(b),] of the instructions with respect to delivery of the [ ]
          [indicate type of securities] deliverable upon such exercise, subject
          to timely receipt from DTC of the necessary information, and (iii) of
          such other information as the Company shall reasonably require;

               (v)   notify, by such time as necessary to ensure a prompt
          closing, DTC, with a copy to the Company, each account at DTC to be
          credited with [ ] [indicate type of securities] and the amount thereof
          to be credited to each such account; and

               (vi)  subject to [ ] [indicate type of securities] being made
          available to the Warrant Agent by or on behalf of the Company for
          delivery to accounts within DTC, liaise with DTC and endeavor to
          effect such delivery to the relevant accounts at DTC in accordance
          with its requirements.

     (h)  All questions as to the validity, form and sufficiency (including time
of receipt) of a Warrant exercise will be determined by the Company in its sole
discretion, which determination shall be final and binding. The Company reserves
the absolute right to reject any and all Warrant Exercise Notices not in proper
form or for which any corresponding agreement by the Company to exchange would,
in the opinion of the Company, be unlawful. Moreover, the Company reserves the
absolute right to waive any of the conditions to the exercise of Warrants or
defects in Warrant Exercise Notices with regard to any particular exercise of
Warrants. None of the Company and the Warrant Agent shall be under any duty to
give notice to the holders of the Warrants of any irregularities in any exercise
of Warrants, nor shall any of them incur any liability for the failure to give
such notice.

     (i)  As soon as practicable after the exercise of any Warrant, but in no
event later than [9:00 A.M., New York City time,] on the Settlement Date, the
Company shall issue, or otherwise deliver, in authorized denominations to or
upon the order of the holder of the Warrant Certificates evidencing such
Warrants, by same-day credit to such holder's account at DTC or to the account
of a participant in DTC, in each case designated by such holder, or by the
direct participant in DTC, through which such holder is acting, in its Warrant
Exercise Notice, the [ ][indicate type of securities] to which such holder is
entitled, in fully registered form, registered in such name or names as may be
directed by such holder or such participant.

                                       -5-

<PAGE>

     4.   Rights of Holders. (a) No Warrant Certificate or Warrants evidenced
thereby shall entitle the holder thereof to any of the rights of a holder of the
[  ] [indicate type of securities].

     (b)  Notwithstanding any of the provisions of this Agreement, any holder of
Warrants may, without the consent of the Warrant Agent, the holder of any [ ]
[indicate type of securities] or the holder of any other Warrants, on its own
behalf and on behalf of any beneficial owner for whom it is acting, enforce, and
may institute and maintain any suit, action or proceeding against the Company
suitable to enforce, or may take any other action in respect of, its right to
exercise the Warrants evidenced by its Warrant Certificate in the manner
provided in such Warrant Certificate and herein.

     5.   Registration. The Warrant Agent shall keep, at its corporate trust
office, books in which, subject to such reasonable regulations as it may
prescribe, it shall register the Warrant Certificates and exchanges and
transfers of outstanding Warrant Certificates upon surrender of the Warrant
Certificates properly endorsed or accompanied by appropriate instruments of
registration of transfer and written instructions for transfer, all in form
satisfactory to the Company and the Warrant Agent. No service charge shall be
made for any exchange or registration of transfer of the Warrant Certificates,
but the Company may require payment of a sum sufficient to cover any stamp or
other tax or other governmental charge that may be imposed in connection with
any such exchange or registration of transfer.

     6.   Exchange, Transfer, Replacement and Cancellation of Warrant
Certificates.

     (a) Subject to Section 7, upon surrender at the corporate trust
office of the Warrant Agent by hand, mail or book-entry delivery, the Warrant
Certificates evidencing Warrants may be exchanged for Warrant Certificates of
the same tenor and dollar amount evidencing such Warrants or the transfer
thereof may be registered in whole or in part provided that such other Warrant
Certificates evidence the same aggregate number of Warrants as the Warrant
Certificates so surrendered. Whenever a Warrant Certificate is so surrendered
for exchange or registration of transfer, an authorized officer of the Warrant
Agent shall manually countersign and deliver to the person or persons entitled
thereto a Warrant Certificate duly authorized and executed by the Company, as so
requested. The Warrant Agent shall not be required to effect any exchange or
registration of transfer which will result in the issuance of a Warrant
Certificate evidencing a fraction of a Warrant. The Warrant Certificate issued
upon any exchange or registration of transfer of a Warrant Certificate shall be
the legal, valid and binding obligations of the Company, evidencing the same
obligations and entitled to the same benefits under this Agreement, as the
Warrant Certificates surrendered for such exchange or registration of transfer.

     (b)  Any Warrant Certificate surrendered for exchange, registration of
transfer or exercise of the Warrants evidenced thereby shall if surrendered to
the Company, be delivered to the Warrant Agent and all Warrant Certificates
surrendered or so delivered to the Warrant Agent shall be promptly canceled by
the Warrant Agent and shall not be

                                       -6-

<PAGE>

reissued and, except as expressly permitted by this Agreement, no Warrant
Certificate shall be issued hereunder in exchange or in lieu thereof. The
Warrant Agent shall deliver to the Company from time to time or otherwise
dispose of the canceled Warrant Certificates in its customary manner.

     (c)  Upon receipt by the Warrant Agent of evidence reasonably satisfactory
to it of the ownership of and the loss, theft, destruction or mutilation of any
Warrant Certificate and of indemnity reasonably satisfactory to it and, in the
case of mutilation, upon surrender thereof to the Warrant Agent for
cancellation, then, in the absence of notice to the Company or a responsible
corporate trust officer of the Warrant Agent that such Warrant Certificate has
been acquired by a bona fide purchaser, the Company shall execute, and an
authorized officer of the Warrant Agent shall manually countersign and deliver,
in exchange for or in lieu of the lost, stolen, destroyed or mutilated Warrant
Certificate, a new Warrant Certificate of the same tenor and evidencing like
Warrants. Every substitute Warrant Certificate executed and delivered pursuant
to this Section in lieu of any lost, stolen or destroyed Warrant Certificate
shall represent an additional contractual obligation of the Company, whether or
not the lost, stolen or destroyed Warrant Certificate shall be at any time
enforceable by anyone, and shall be entitled to the benefits of this Agreement
equally and proportionately with any and all other Warrant Certificates duly
executed and delivered hereunder. The provisions of this Section are exclusive
and shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement of mutilated, lost, stolen or destroyed Warrant
Certificates.

     (d)  Upon the issuance of any new Warrant Certificate under this Section,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Warrant Agent) in connection
therewith.

     (e)  The holder of a Warrant Certificate, by accepting the same, consents
and agrees with the Company, the Warrant Agent and with every subsequent holder
of such Warrant Certificate that until the transfer of the Warrant Certificate
is registered on the books of the Warrant Agent, the Company and the Warrant
Agent may treat such registered holder as the absolute owner thereof for any
purpose and as the person entitled to exercise the rights represented by the
Warrant evidenced thereby, any notice to the contrary notwithstanding.

     7.   Global Securities. The Warrants shall be issued initially in the form
of one or more Global Warrant Certificates that will be deposited with, or on
behalf of, DTC. Global Warrant Certificates may be issued only in fully
registered form and in either temporary or definitive form. Unless and until it
is exchanged in whole or in part for Warrant Certificates in definitive form, a
Global Warrant Certificate may not be transferred except as a whole by DTC to a
nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC
or any nominee of DTC to a successor depositary or any nominee of such
successor.

                                       -7-

<PAGE>

     So long as DTC, or its nominee, is the registered owner of a Global Warrant
Certificate, DTC or such nominee, as the case may be, will be considered the
sole owner or holder of the Warrants represented by such Global Warrant
Certificate for all purposes under this Agreement. Except as specified below
with respect to Warrants only, owners of beneficial interests in a Global
Warrant Certificate will not be entitled to have any Warrants registered in
their names, and will not receive or be entitled to receive physical delivery of
any such Warrants in definitive form and will not be considered the owners or
holders thereof under the Warrants or this Agreement. Neither the Company nor
the Warrant Agent, in its capacity as registrar for such Warrants, will have any
responsibility or liability for any aspect of the records relating to beneficial
interests in a Global Warrant Certificate or for maintaining, supervising or
reviewing any records relating to such beneficial interests.

     If at any time DTC notifies the Company that it is unwilling or unable to
continue as depositary for the Warrants, or if the Company notifies DTC that it
will no longer continue to use DTC as depositary for the Warrants, or if at any
time DTC ceases to be a clearing agency registered under the United States
Securities Exchange Act of 1934, as amended, or otherwise ceases to be eligible
to be a depositary, the Company shall appoint a successor depositary with
respect to the Warrants (and all references to DTC herein shall be deemed to
include such successor depositary). If a successor depositary for the Warrants
is not appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such ineligibility, the Company will execute, and the
Warrant Agent upon receipt of such executed definitive Warrant Certificates will
authenticate and deliver, Warrant Certificates in definitive registered form
evidencing an aggregate number of Warrants equal to the aggregate number of
Warrants evidenced by the Global Warrant Certificate.

     The Company may at any time and in its sole discretion determine not to
have any of the Warrants evidenced by Global Warrant Certificates. In such
event, the Company will execute, and the Warrant Agent, upon receipt of such
executed definitive Warrant Certificates, will authenticate and deliver Warrant
Certificates in definitive registered form, in an aggregate amount equal to the
aggregate number of Warrants evidenced by such Global Warrant Certificates.

     Upon the exchange of the Global Warrant Certificates for Warrant
Certificates in definitive registered form, the Global Warrant Certificates
shall be canceled by the Warrant Agent.

     Warrant Certificates in definitive registered form issued in exchange for
the Global Warrant Certificates pursuant to this section shall be registered in
such names as DTC, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Warrant Agent or the Company. The
Warrant Agent shall deliver such Warrant Certificates in definitive registered
form to or as directed by the persons in whose names such definitive registered
Warrant Certificates are so registered.

                                       -8-

<PAGE>

     All Warrant Certificates in definitive registered form, issued upon the
exchange of the Global Warrant Certificates, shall be valid obligations of the
Company, evidencing the rights, and entitled to the same benefits under this
Agreement, as the Global Warrant Certificates surrendered upon such exchange.

     8.   Rights of Warrant Agent. The Company shall have the following
obligations to the Warrant Agent and the Warrant Agent shall have the following
rights:

     (a)  In acting under this Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the Company and
does not assume any obligation towards or relationship of agency or trust for or
with the owners or holders of Warrants.

     (b)  The Warrant Agent shall be entitled to compensation, as agreed upon
with the Company, for all services rendered by it and expenses incurred in
connection therewith, and the Company agrees promptly to pay such compensation
and to reimburse the Warrant Agent for any agreed upon expenses incurred by the
Warrant Agent in connection with the services rendered by it (as documented in
an invoice setting forth such expenses).

     (c)  The Warrant Agent shall be entitled to consult with counsel and the
opinion, written or otherwise, of such counsel shall be full and complete
authorization and protection in respect of any action taken, omitted to be taken
or suffered by it hereunder in good faith and in accordance with the opinion of
such counsel.

     (d)  The Warrant Agent shall be protected and shall incur no liability for
or in respect of any action taken or omitted to be taken or anything suffered by
it in reliance upon the Warrants, any Warrant Certificate, the [ ] [indicate
type of securities] or any notice, direction, consent, certificate, affidavit,
statement or other paper or document (whether in its original or facsimile form)
reasonably believed by it to be genuine and to have been passed or signed by the
proper parties.

     (e)  The Warrant Agent or any of its officers, directors and employees may
become the beneficial owner of, or acquire an interest in, Warrants or [ ]
[indicate type of securities] with the same rights that it would have if it were
not the Warrant Agent hereunder, and to the extent permitted by applicable law,
may engage in or be interested in any financial or other transaction with the
Company, and may act on behalf of, or as depositary, trustee or agent for, any
committee or body of beneficial owners of the Warrants, the [ ] [indicate type
of securities], or other obligations of the Company, as freely as if it were not
the Warrant Agent hereunder.

     (f)  The recitals contained herein and in the Warrant Certificates (except
in the Warrant Agent's certificate of authentication on the Warrant
Certificates) shall be taken as the statements of the Company and the Warrant
Agent assumes no responsibility for the correctness of the same. The Warrant
Agent makes no representation as to the validity

                                       -9-

<PAGE>

or sufficiency of this Agreement or the Warrant Certificates except for the due
authorization of the Warrant Agent to execute this Agreement.

     (g)  The Warrant Agent shall be obligated to perform such duties and only
such duties as are herein and in the Warrant Certificates specifically set forth
and no implied duties or obligations shall be read into this Agreement or the
Warrant Certificates against the Warrant Agent. The Warrant Agent shall not be
under any obligation to take any action hereunder which may tend to involve it
in any reimbursable expense or liability, the payment of which within a
reasonable time is not in its reasonable opinion, assured to it.

     (h)  Unless otherwise specifically provided herein or in the Warrant
Certificates, any order, certificate, notice, request, direction or other
communication from the Company made or given by the Company under any provision
of this Agreement shall be sufficient if signed by an Authorized Person of the
Company.

     (i)  If the Warrant Agent shall receive any notice or demand (other than
notice of or demand for exercise of Warrants) addressed to the Company by the
holder of the Warrant Certificates pursuant to the provisions of the Warrant
Certificates, the Warrant Agent shall promptly forward such notice or demand to
the Company.

     (j)  The Warrant Agent may at any time resign as Warrant Agent, by giving
written notice to the Company of such intention on its part, mailed to the
Company at its address set forth in Section 12, specifying the date on which its
desired resignation shall become effective; provided, however, that such date
shall never be less than 90 days after the date of receipt of such notice by the
Company unless the Company agrees to accept shorter notice. The Warrant Agent
may be removed at any time by the filing with it of an instrument in writing
signed by an Authorized Person of the Company and specifying such removal and
the date when it is intended to become effective. Such resignation or removal
shall take effect upon the date of the appointment by the Company, as
hereinafter provided, of a successor Warrant Agent (which shall be a bank or
trust company authorized under the laws of the jurisdiction of its incorporation
to exercise corporate trust powers) and the acceptance of such appointment by
the successor Warrant Agent. If a successor Warrant Agent is not appointed by
the Company within 90 days after the resignation of the Warrant Agent, the
Warrant Agent shall be entitled to petition at the expense of the Company a
court of competent jurisdiction for appointment of a successor Warrant Agent.
Upon its resignation or removal, the Warrant Agent shall be entitled to the
payment by the Company of its compensation for the services rendered hereunder
and to the reimbursement of all reasonable and duly documented out-of-pocket
expenses (including reasonable and duly documented counsel fees) incurred in
connection with the services rendered hereunder (as described in Section 8(b)).
The indemnity described in Section 9 shall survive any resignation or removal of
the Warrant Agent or the termination of this Agreement.

                                      -10-

<PAGE>

     (k)  In case at any time the Warrant Agent shall resign, or shall be
removed, or shall become incapable of acting, or shall be adjudged a bankrupt or
insolvent, or shall file a voluntary petition in bankruptcy or make an
assignment for the benefit of its creditors or consent to the appointment of a
receiver of all or any substantial part of its property or affairs or shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay or meet its debts generally as they become due, or if an
order of any court shall be entered approving any petition filed by or against
the Warrant Agent under the provisions of bankruptcy laws or any similar
legislation, or if a receiver, trustee or other similar official of it or of all
or any substantial part of its property shall be appointed, or if any public
officer shall take charge or control of it or of its property or affairs, for
the purpose of rehabilitation, conservation, protection, relief, winding up or
liquidation, a successor Warrant Agent shall be appointed by the Company by an
instrument in writing, filed with the successor Warrant Agent. Upon the
appointment as aforesaid of a successor Warrant Agent and acceptance by it of
such appointment, the Warrant Agent so superseded shall, if not previously
disqualified by operation of law, cease to be the Warrant Agent hereunder.

     (l)  Any successor Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to its predecessor and to the Company an instrument
accepting such appointment hereunder, and thereupon such successor Warrant
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trusts, immunities, duties and obligations of
such predecessor with like effect as if originally named as Warrant Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Warrant Agent shall be entitled to receive all moneys,
securities, records or other property on deposit with or held by such
predecessor, as Warrant Agent hereunder.

     (m)  Any corporation or bank into which the Warrant Agent may be merged or
converted, or any corporation or bank with which the Warrant Agent may be
consolidated, or any corporation or bank resulting from any merger, conversion
or consolidation to which the Warrant Agent shall be a party, or any corporation
or bank to which the Warrant Agent shall sell or otherwise transfer all or
substantially all the assets and business of the Warrant Agent, or any
corporation or bank to which the Warrant Agent shall sell or otherwise transfer
all or substantially all its corporate trust business, provided that it shall be
qualified as aforesaid, shall be the successor to the Warrant Agent under this
Agreement without the execution or filing of any document or any further act on
the part of any of the parties hereto.

     (n)  the Warrant Agent:

               (i)   need not act on any notice given under this Agreement by
          the Company or any other person which is received orally until it has
          been confirmed in writing;

                                      -11-

<PAGE>

               (ii)  is authorized to communicate with any person from whom an
          exercise of Warrants is received but is not obliged to do so, if it
          reasonably believes to do so would breach laws or regulations relating
          to the sale of securities in a jurisdiction; and

               (iii) is authorized to cooperate with and to furnish any
          organization (and its representatives) designated from time to time by
          the Company in any manner reasonably requested by it in connection
          with the exercise of the Warrants and any exercises thereunder; and
          will not be responsible for procuring, nor liable for the consequences
          of, any transfers of Warrants in any accounts.

     (o)  The Warrant Agent shall have no responsibility for failing to provide
information or to take any action hereunder or by a time specified hereunder if
such failure is attributable (directly or indirectly) to any failure on the part
of DTC to provide in a form satisfactory to it any confirmations or other
information required by it to carry out its functions hereunder and it may rely
conclusively without investigation on any such information provided by any such
entity.

     (p)  The Warrant Agent shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document.

     (q)  The rights, privileges, protections, immunities and benefits given to
the Warrant Agent, including, without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Warrant Agent in each of its
capacities hereunder, and to each agent, custodian and other person employed to
act hereunder.

     9.   Indemnity. The Company shall indemnify the Warrant Agent for, and hold
it harmless against, any loss, liability or expense (including the costs and
expenses of defending any claim of liability) incurred without negligence, bad
faith, or willful misconduct of the Warrant Agent or its employees, directors,
officers, or agents in connection with its acting as its duties hereunder.

     10.  Taxes. The Company will pay all stamp taxes or other duties, if any,
which may be imposed by the United States of America, or any political
subdivision or taxing authority thereof or therein, with respect to the
execution or delivery of this Agreement or the issuance of a Warrant
Certificate. The Company shall not be required to pay any stamp or other tax or
other governmental charge required to be paid in connection with any transfer
involved in the issuance of the [ ] [indicate type of securities]; and if any
such transfer is involved, the Company shall not be required to issue or deliver
any [ ][indicate type of securities] until such tax or other charge shall have
been paid or provided for or it has been established to the Company's
satisfaction that no such tax or other charge is due.

                                      -12-

<PAGE>

     11.  Amendments. This Agreement may be amended or supplemented by the
parties hereto, without the consent of the holder of any Warrant Certificate,
for the purpose of curing any ambiguity or of curing, correcting or
supplementing any defective provision contained herein, or in any manner which
the parties may mutually deem necessary or desirable and which shall not
adversely affect the interests of the holders of the Warrant Certificates. The
Warrant Agent shall promptly notify in writing each holder of any such amendment
and deliver a copy of such amendment to any holder who shall so request in
writing, all at the cost of the Company.

     12.  Notices. Any communication required to be given shall be given to the
parties hereto as follows:

If to the Company:             Constellation Energy Group, Inc.
                               750 E. Pratt Street
                               Baltimore, MD 21202
                               Fax:  410-783-3619
                               Attention:  Treasurer

If to the Warrant Agent:       The Bank of New York
                               Fax:  [  ]
                               Attention:  [  ]

(or such other address as shall be specified in writing by the relevant party to
the other parties hereto.)

Communications between the Company and the Warrant Agent shall be delivered by
hand, facsimile or sent by courier. Any notice to the holders of the Warrants
which by any provision of this Warrant Agreement is required or permitted to be
given shall be given by first class mail postage prepaid at such holder's
address as it appears on the books of the Warrant Agent. Communications between
the Company and the Warrant Agent shall be deemed to be effective on receipt,
for which purpose any communication shall, if sent by facsimile, be deemed to
have been received at the time of dispatch and, if sent by courier, be deemed to
have been received after 2 days. Communications to Warrant holders shall be
deemed to be effective at the time of dispatch or mailing.

     13.  Delivery of Prospectus. To the extent required by law, the Company
will furnish to the Warrant Agent copies of a prospectus contained in a
Registration Statement declared effective under the Securities Act of 1933, as
amended (the "Act"), and any necessary prospectus supplement relating to the [ ]
[indicate type of securities] deliverable upon exercise of any Warrants
(collectively the "Prospectus") in such quantity as requested by the exercising
Warrant holder, the Warrant Agent agrees that upon receipt of a Warrant Exercise
Notice from any holder, the Warrant Agent will as soon as practicable deliver to
such holder, if instructed by the Company that such

                                      -13-

<PAGE>

delivery is required by law or upon request of such holder, prior to the Warrant
Exercise Date, a Prospectus, all at the cost of the Company.

     14.  Obtaining of Governmental Approvals. The Company will from time to
time take all action which may be necessary to obtain and keep effective any and
all consents and approvals of governmental agencies and authorities and
securities acts filings under United States Federal and State laws which may be
or become requisite in connection with the issuance, sale, transfer, and
delivery of the Warrants, the Warrant Certificates, the exercise of the
Warrants, the issuance, sale, transfer and delivery of the [ ] [indicate type of
securities] issuable upon exercise of the Warrants or upon the expiration of the
period during which the Warrants are exercisable. The Company covenants that it
will obtain all necessary governmental authorizations which may be required to
issue the [ ] [indicate type of securities] upon exercise of the Warrants and
the Company will issue the [ ] [indicate type of securities] pursuant to
registration under the Act.

     15.  Headings. The descriptive headings of the several Articles and
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.

     16.  Governing Law. This Agreement, the Warrants and the Warrant
Certificates shall be governed by and construed in accordance with the laws of
the State of New York.

     17.  Persons Having Rights under Warrant Agreement. Nothing in this
Agreement expressed or implied and nothing that may be inferred from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the Company, the Warrant Agent and the
holder of any Warrants any right, remedy or claim under or by reason of this
Agreement or of any covenant, condition, stipulation, promise or agreement
hereof, and all covenants, conditions, stipulations promises and agreements in
this Agreement contained shall be for the sole and exclusive benefit of the
Company, the Warrant Agent and its successors and holders of the Warrants.

     18.  Further Issues. The Company may from time to time, without notice to
or the consent of the registered holders of Warrants, create and issue further
Warrants identical with the Warrants in all respects and so that such further
warrants shall be consolidated and form a single series with the Warrants and
shall have the same terms as to status, exercise or otherwise as the Warrants.
The issuance of such further warrants shall be pursuant to an agreement
supplemental hereto.

     19.  Counterparts. This Agreement may be executed in or by separate
counterparts, and by each party separately on a separate counterpart, each such
counterpart, when so executed and delivered, to be an original. Such
counterparts shall together constitute but one and the same instrument.

                                      -14-

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have, by duly authorized directors,
officers or attorneys-in-fact, executed this Agreement as of the date first
above written.

                                    CONSTELLATION ENERGY GROUP, INC.

                                    By:
                                       --------------------------
                                       Name:
                                       Title:

                                    THE BANK OF NEW YORK, as Warrant Agent

                                    By:
                                       --------------------------
                                       Name:
                                       Title:

                                      -15-

<PAGE>

                                                                       Exhibit A

                          [FORM OF WARRANT CERTIFICATE]

     [IF THE WARRANT CERTIFICATE IS TO BE A GLOBAL WARRANT CERTIFICATE, INSERT--
This Warrant Certificate is a Global Warrant Certificate within the meaning of
the Warrant Agreement hereinafter referred to and is registered in the name of
The Depository Trust Company ("DTC") or a nominee of DTC. Unless and until it is
exchanged in whole or in part for Warrants in definitive registered form, this
Warrant Certificate may not be transferred except as a whole by DTC to a nominee
of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any
such nominee to a successor depositary or a nominee of such successor
depositary).

     Unless this Warrant Certificate is presented by an authorized
representative of DTC ([ ] [indicate address of the depositary company]) to the
Warrant Agent or its agents for registration of transfer, exchange or payment,
and any Warrant issued is registered in the name of Cede & Co. or such other
name as requested by an authorized representative of DTC and any payment hereon
is made to Cede & Co. or such other entity as is requested by an authorized
representative of DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede
& Co., has an interest herein.]

     The Warrants evidenced hereby are exercisable only if countersigned by the
Warrant Agent as provided herein.

     VOID IF NOT EXERCISED BY [5:00 P.M., NEW YORK CITY TIME,] ON [ ].

                                       A-1

<PAGE>

              CONSTELLATION ENERGY GROUP, INC. WARRANT CERTIFICATE

CUSIP NO.: [_________]
ISIN NO.: [_________]                                      [________] Warrants

          This certifies that [CEDE & CO.] or its registered assigns (the
"Registered Holder") is the registered owner of the above Warrants. Each Warrant
entitles the registered owner to exercise, [commencing at 9:00 A.M., New York
City] on [ ] [but no later than 5:00 P.M., New York City time,] on [ ], an
option to purchase, at an exercise price of U.S. $[ ], [ ] of [ ] [indicate type
of securities] (the "[ ]") of Constellation Energy Group, Inc. (the "Company").
The [ ] [indicate type of securities] will be issued and delivered by the
Company on [ ]. The holder may exercise the Warrants evidenced hereby in whole
or in part during the period herein specified, provided, that [no fewer than one
Warrant may be exercised per Warrant Exercise Notice and no fractional Warrants
may be exercised,] by (i) providing written notice of such election to exercise
such Warrants ("Warrant Exercise Notice") to the Warrant Agent at [ ],
"Attention: Constellation Energy Group, Inc. Warrant Exercise", or such other
address of the Warrant Agent as the Warrant Holders may be notified of by the
Company prior to [ ], by hand or facsimile, no later than [5:00 P.M., New York
City time,] on the [ ], which Warrant Exercise Notice shall be in the form of an
election to purchase [ ] [indicate type of securities] substantially in the form
set forth as Exhibit B to the Warrant Agreement, properly completed and executed
by the holder; (ii) delivering, no later than [5:00 P.M., New York City time,]
on [ ], such Warrants to the Warrant Agent by book-entry transfer through the
facilities of DTC or by delivering, no later than [5:00 P.M., New York City
time,] on [ ], the Warrant Certificates evidencing such Warrants to the Warrant
Agent if Warrant Certificates in definitive form have been issued and delivered
pursuant to Section 7 of the Warrant Agreement and (iii) for each Warrant
exercised, paying in full, in lawful money of the United States of America, by
bank wire transfer in immediately available funds no later than [11:00 A.M., New
York City time] on [ ] (the "Settlement Date"), the exercise price of U.S. $[ ].

     This Warrant Certificate is issued pursuant to and in accordance with a
Warrant Agreement, dated as of [ ] (the "Warrant Agreement") between the Company
and the Warrant Agent and is subject to the terms and provisions contained
therein to all of which terms and provisions the holder consents by acceptance
hereof. Copies of the Warrant Agreement are on file at the above-mentioned
office of the Warrant Agent. Capitalized terms used in this Warrant Certificate
and not defined herein will have the respective meanings given such terms in the
Warrant Agreement.

     This Warrant Certificate may be transferred at the corporate trust office
of the Warrant Agent by the Registered Holder or its assigns, in person or by an
attorney duly authorized in writing, in the manner and subject to the
limitations provided in the Warrant Agreement.

     After countersignature by the Warrant Agent and prior to the expiration of
the Warrants, this Warrant Certificate may be exchanged at the corporate trust
office of the Warrant Agent for one or more Warrant Certificates, representing
the same number of Warrants of the same tenor.

                                       A-2

<PAGE>

     This Warrant Certificate shall not entitle the Registered Holder to any of
the rights of a holder of the [ ] [indicate type of securities].

     Unless the certificate of authentication hereon has been executed by the
Warrant Agent by the manual signature of one of its duly authorized officers,
this Warrant Certificate shall not be valid or obligatory for any purpose.

Dated: [  ]

CONSTELLATION ENERGY GROUP, INC.

By:
   -------------------------------
Name:
Title:

Authenticated by
THE BANK OF NEW YORK
as Warrant Agent without recourse,
warranty or liability

By:
   -------------------------------
         Authorized Signature

                                       A-3

<PAGE>

                                                                       Exhibit B

                        [FORM OF WARRANT EXERCISE NOTICE]

                     [TO BE COMPLETED BY DIRECT PARTICIPANT
                                     IN DTC]

                        Constellation Energy Group, Inc.
             Warrants to Purchase [ ] [indicate type of securities]

                    TO BE EXECUTED UPON EXERCISE OF WARRANTS

     The undersigned hereby irrevocably elects to exercise the number of
Warrants set forth below. Each Warrant entitles the registered owner to
exercise, [commencing at 9:00 A.M., New York City time] [ ], [but no later than
5:00 P.M., New York City time,] on [ ], an option to purchase, at an exercise
price of $[ ], $[ ] newly issued [ ] [indicate type of securities] (the "[ ]")
of Constellation Energy Group, Inc. (the Company"). The undersigned represents,
warrants and promises that (1) it has delivered or will deliver no later than
[5:00 P.M., New York time,] on [ ] the number of Warrants specified below to the
Warrant Agent's account at DTC by book-entry transfer; (2) it has the full power
and authority to exercise and deliver the Warrants exercised hereby; and (3)
[payment details] no later than [11:00 A.M., New York City time] on [ ] (the
"Settlement Date"), the exercise price of U.S. $[ ] for each Warrant exercised
hereby.

     The undersigned requests that the principal amount of Warrants exercised
hereby be in registered form in the authorized denominations, registered in such
names and delivered, all as specified in accordance with the instructions set
forth below; provided, that if the [ ] [indicate type of securities] are
evidenced by global securities, the [ ] [indicate type of securities] shall be
registered in the name of DTC or its nominee.

                                       B-1

<PAGE>

Dated: [   ]

<TABLE>
<S>                                                       <C>
Note:  This exercise notice must be delivered to The      where you can contact the warrant agent and to which
       Bank of New York, the Warrant Agent, prior to      warrant exercise notices are to be submitted.  You may
       [5:00 P.M., New York City time,] on [  ].  The     not submit your warrant exercise notice or deliver
       Warrant Agent shall notify you (through the        your Warrants until [9:00 A.M., New York City time,]
       clearing system) of (1) the warrant agent's        on [  ].  Warrant exercise notices will only be valid
       account at DTC to which you must deliver your      if delivered in accordance with the instructions set
       warrants on the Exercise Date and (2) the          forth in this notification (or as otherwise directed),
       address, phone number and facsimile number         marked to the attention of "Constellation Energy
                                                          Group, Inc. Warrant Exercise".

Name of DTC Direct Participant:                           Warrant holder delivering Warrants, if other than the
                                                          direct DTC Participant delivering this warrant exercise
___________________________________________________       notice
                      (Please Print)

Address:     ______________________________________

             ______________________________________       Name:_______________________________________________
                                                                                 (Please Print)

Contact Name: _____________________________________
                                                          Address:____________________________________________

                                                                   ___________________________________________
Telephone (including international code):_________

Fax (including international code):  ______________

___________________________________________________       Contact Name:_________________________________

Social Security or Other Taxpayer Identification
Number (if applicable):_________________________          Telephone (including international code):___________
                                                          ____________________________________________________

                                                          Fax (including international code):_________________

                                                          ____________________________________________________

                                                          Social Security or Other Taxpayer Identification Number
                                                          (if applicable):____________________________________

Account from which Warrants are being delivered:          Account to which the [ ] [indicate type of securities]
                                                          are to be credited:

.. DTC Account No.__________________________________
                                                          . DTC Account No.___________________________________
</TABLE>

<PAGE>

Fill in for delivery of [ ] [indicate type of securities], if other than to the
person delivering this warrant exercise notice:.

Name:______________________________________________
                      (Please Print)

Address:___________________________________________

          _________________________________________

Contact Name:______________________________________

Telephone (including international code):__________

___________________________________________________

Fax (including international code):_________________

___________________________________________________

Social Security or Other Taxpayer Identification Number (if
applicable):__________________________

<PAGE>

Number of Warrants Being Exercised[ (at least [two])]: _________________________

     (only one exercise per warrant exercise notice)

                                      Signature
                                               ---------------------------------

                                      Name:
                                           -------------------------------------

                                      Capacity in which Signing:
                                                                ----------------

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