Document:

Exhibit 10.2

 

TAX MATTERS AGREEMENT

 

THIS TAX MATTERS AGREEMENT
is dated January 31, 2022, by and among Exelon Corporation (“Exelon”), a Pennsylvania corporation, by and
on behalf of itself and each Affiliate of Exelon (as determined after the Distribution), and Constellation Energy Corporation, a Pennsylvania
corporation and, immediately prior to the Distribution (as defined below), a direct, wholly-owned subsidiary of Exelon (“Constellation”),
by and on behalf of itself and each Affiliate of Constellation (as determined after the Distribution). Capitalized terms used herein and
not otherwise defined shall have the meanings ascribed to such terms in the Separation Agreement, dated January 31, 2022, by and
between Exelon and Constellation (the “Separation Agreement”).

 

RECITALS

 

WHEREAS, Exelon is the common
parent of an affiliated group whose includible corporations join in the filing of a consolidated U.S. federal income Tax Return (the
 “Exelon Federal Consolidated Group”);

 

WHEREAS, as of the date of
this Agreement and immediately prior to the Distribution, Constellation is a subsidiary of Exelon and a member of the Exelon Federal Consolidated
Group;

 

WHEREAS, the board of directors
of Exelon has determined that it is advisable and in the best interests of Exelon and its shareholders to separate the Exelon Business
and the Constellation Business, which separation shall be effected by Exelon contributing the Constellation Business to Constellation
and then distributing the Constellation shares that it receives in exchange to Exelon’s shareholders on a pro rata basis, thereby
causing Constellation to become a separate, publicly-traded company;

 

WHEREAS, it is the intention
of the Parties that the Contribution (as defined below) and the Distribution together qualify as a reorganization within the meaning of
Sections 368(a)(1)(D) and 355 of the Code;

 

WHEREAS, Exelon has received
the IRS Ruling and the Tax Opinion (each as defined below), together substantially to the effect that the Distribution, together with
certain related transactions, will qualify for tax-free treatment under Sections 355 and 368(a)(1)(D) of the Code;

 

WHEREAS, in contemplation
of the Contribution and the Distribution, Exelon and Constellation desire to set forth their agreement as to the rights and obligations
of Exelon, Constellation, and their respective Affiliates with respect to the responsibility, handling and allocation of federal, state
and local Taxes, and various other Tax matters.

 

NOW, THEREFORE, in consideration
of the foregoing and the terms, conditions, covenants, and provisions of this Agreement, Exelon, Constellation, and their respective Affiliates
(as determined after the Distribution) mutually covenant and agree as follows:

 

    	 	 	 

     

    

 

ARTICLE I

DEFINITIONS

 

“Active Business”
means any trades or businesses conducted by Exelon or its Affiliates or Constellation or its Affiliates, as the case may be, that are
relied upon, including the trades or businesses reflected in the Tax Opinion or the IRS Ruling, to satisfy Section 355(b) of
the Code.

 

“Adjustment”
means an adjustment of any item of income, gain, loss, deduction, credit or any other item affecting Taxes of a taxpayer pursuant to a
Final Determination.

 

“Advisory
Firm” has the meaning prescribed in Section 7.02.

 

“Affiliate”
has the meaning set forth in the Separation Agreement.

 

“After
Tax Amount” means any additional amount necessary to reflect (through a gross-up mechanism) the hypothetical Tax
consequences of the receipt or accrual of any payment required to be made under this Agreement (including payment of an additional amount
or amounts hereunder and the effect of the deductions available for interest paid or accrued and for Taxes, such as state and local income
Taxes), determined by using the highest marginal corporate Tax rate (or rates, in the case of an item that affects more than one Tax)
for the relevant taxable period (or portion thereof).

 

“Agreement”
means this Tax Matters Agreement, including any schedules, exhibits, and appendices attached hereto.

 

“Ancillary
Agreement” has the meaning set forth in the Separation Agreement.

 

“ASC
740-10” means Financial Accounting Standard Board Accounting Standard Codification Subtopic 740-10, Income Taxes,
including any amended or successor version.

 

“Attribute
Issue” has the meaning prescribed in Section 5.03(b).

 

“Benefited
Party” has the meaning prescribed in Section 2.06(c).

 

“Business
Day” has the meaning set forth in the Separation Agreement.

 

“Code”
means the Internal Revenue Code of 1986, as amended.

 

“Constellation”
has the meaning set forth in the preamble.

 

“Constellation
Allocable Audit Portion” means the amount of any additional Taxes due and payable that are attributable to a Pre-Distribution
Period or the portion of a Straddle Period ending on the Distribution Date that were not reported on a Tax Return filed or provided to
a Taxing Authority for such Pre-Distribution Period or Straddle Period, in each case to the extent such additional Taxes are attributable
to any member of the Constellation Group. The determination of the amount of Taxes due and payable that are attributable to any member
of the Constellation Group included in an Exelon Combined Group shall be made in a manner consistent with past practice of the Parties
under the Prior Tax Sharing Agreement.

 

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“Constellation
Allocable Portion” means, with respect to a Tax Return filed or provided to a Taxing Authority after the Distribution Date
for either a Pre-Distribution Period or Straddle Period, the positive amount (if any) of Taxes due and payable, after taking into account
all prior payments, including estimated payments, for such Pre-Distribution Period or Straddle Period attributable to any member of the
Constellation Group. The determination of the amount of Taxes due and payable that are attributable to any member of the Constellation
Group included in an Exelon Combined Group shall be made in a manner consistent with past practice of the Parties under the Prior Tax
Sharing Agreement.

 

“Constellation
Business” has the meaning set forth in the Separation Agreement.

 

“Constellation
Common Stock” has the meaning set forth in the Separation Agreement.

 

“Constellation
Group” means Constellation and Affiliates of Constellation immediately after the Distribution, and entities that
become Affiliates thereafter.

 

“Constellation
Liabilities” has the meaning set forth in the Separation Agreement.

 

“Constellation
Representation Letter” means an officer’s certificate in which certain representations, warranties, and covenants
are made on behalf of Constellation and its Affiliates in connection with the issuance of the Tax Opinion.

 

“Constellation
Separate Tax Return” means any Tax Return that is required under applicable Law to be filed by any member of the Constellation
Group, and that does not include any member of the Exelon Group, for a Pre-Distribution Period or a Straddle Period, whether or not such
Tax Return is timely filed.

 

“Constellation
Tainting Act” has the meaning prescribed in Section 2.02(b)(i)(A).

 

“Constellation
Tax Credit Carryforward” means Tax credits described in Schedule A.

 

“Contribution”
means the transfers by Exelon of the assets described in Article II of the Separation Agreement to Constellation in exchange for
(i) the assumption or incurrence, as applicable, by Constellation and certain of its Subsidiaries of the Constellation Liabilities,
and (ii) the issuance by Constellation to Exelon of shares of Constellation Common Stock, all as more fully described in the Separation
Agreement and the Ancillary Agreements.

 

“Deferred
Tax Assets” means, as of a given date, the amount of deferred Tax benefits that would be recognized as assets on
a business enterprise’s balance sheet computed in accordance with GAAP.

 

“Deferred
Tax Liabilities” means, as of a given date, the amount of deferred Tax liabilities that would be recognized as liabilities
on a business enterprise’s balance sheet computed in accordance with GAAP.

 

“Determination”
means (i) any Final Determination, or (ii) the payment of Tax by a Party (or its Affiliate) that is responsible for payment
of that Tax under applicable Law, with respect to any item disallowed or adjusted by a Taxing Authority, as long as the responsible Party
reasonably determines that no action should be taken to recoup that payment and the other Party agrees (such agreement not to be unreasonably
withheld, conditioned or delayed).

 

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“Dispute”
has the meaning set forth in the Separation Agreement.

 

“Distribution”
has the meaning set forth in the Separation Agreement.

 

“Distribution
Date” has the meaning set forth in the Separation Agreement.

 

“Effective
Time” has the meaning set forth in the Separation Agreement.

 

“Employee
Matters Agreement” has the meaning set forth in the Separation Agreement.

 

“Equity
Award” means restricted stock, stock options, restricted stock units, deferred stock units, performance shares or
any other equity-based compensation awards granted, awarded or otherwise paid to a service provider by Exelon or a member of the Constellation
Group, as the case may be.

 

“Exelon”
has the meaning set forth in the preamble.

 

“Exelon
Business” has the meaning set forth in the Separation Agreement.

 

“Exelon
Combined Group” means (i) the Exelon Federal Consolidated Group, (ii) any other group of Persons that (A) includes
at least one member of the Exelon Group and (B) that files Tax Returns on a combined, consolidated, unitary or similar basis, and
(iii) any Person or group of Persons whose items of income, gain, loss or deduction are reflected on a single Tax Return filed by
a member of the Exelon Group by reason of one or more of such Persons being disregarded as a separate entity for U.S. federal or applicable
state and local income tax purposes.

 

“Exelon
Federal Consolidated Group” has the meaning set forth in the recitals.

 

“Exelon
Group” means all entities that are Affiliates of Exelon immediately after the Distribution, and entities that become
Affiliates thereafter.

 

“Exelon
Representation Letter” means an officer’s certificate in which certain representations, warranties and covenants
are made on behalf of Exelon and its Affiliates in connection with the issuance of the Tax Opinion.

 

“Exelon
Tainting Act” has the meaning prescribed in Section 2.02(b)(i)(A).

 

“Final
Determination” means the final resolution of liability for any Tax for a taxable period, including any related interest,
penalties or other additions to tax, (i) by a decision, judgment, decree, or other order by a court of competent jurisdiction, which
has become final and unappealable; (ii) by a final settlement with the IRS, closing agreement or accepted offer in compromise under
Section 7121 or Section 7122 of the Code, or comparable agreement under the Law of other jurisdictions, including a “determination”
as defined in Section 1313(a) of the Code or execution of an IRS Form 870AD; (iii) by any allowance of a Refund in
respect of an overpayment of Tax, but only after the expiration of all periods during which such Refund may be recovered (including by
way of offset) by the jurisdiction imposing such Tax; or (iv) by any other final resolution, including by reason of the expiration
of the applicable statute of limitations or the execution of a pre-filing agreement with the IRS or other Taxing Authority.

 

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“GAAP”
means United States generally accepted accounting principles as in effect on the Distribution Date.

 

“Income
Taxes” means any Taxes based upon, measured by, or calculated with respect to: (i) net income or profits or
net receipts (including, but not limited to, any capital gains, minimum Tax or any Tax on items of Tax preference, but not including gross
receipts, sales, use, real or personal property, transfer or similar Taxes) or (ii) multiple bases (including corporate or franchise,
doing business and occupation taxes) if one or more bases upon which such Tax may be based, measured by, or calculated with respect to,
is described in clause (i).

 

“Indemnified
Party” has the meaning prescribed in Section 6.02.

 

“Indemnifying
Party” has the meaning prescribed in Section 6.02.

 

“Interest Rate”
means, with respect to any payment under this Agreement, a per-annum rate equal to the prime rate as published in The Wall Street Journal
on the due date for such payment.

 

“IRS”
means the United States Internal Revenue Service.

 

“IRS Ruling”
means the private letter ruling issued to Exelon and addressing the tax consequences of any aspect of the Contribution or the Distribution.

 

“IRS Ruling Request”
means the submission by Exelon to the IRS relating to the IRS Ruling, including any amendment or supplement to such IRS Ruling Request.

 

“Law”
has the meaning set forth in the Separation Agreement.

 

“Liability Issue”
has the meaning prescribed in Section 5.03(b).

 

“Non-Income
Taxes” means any Taxes other than Income Taxes.

 

“Party”
means each of Exelon and Constellation.

 

“Person”
has the meaning set forth in the Separation Agreement.

 

“Post-Distribution
Period” means any tax year or other taxable period beginning after the Distribution Date and, in the case of any
Straddle Period, that part of the tax year or other taxable period that begins at the beginning of the day after the Distribution Date.

 

“Post-Distribution
Ruling” has the meaning prescribed in Section 4.03(a).

 

“Pre-Distribution
Period” means any tax year or other taxable period that ends on or before the Distribution Date and, in the case
of any Straddle Period, that part of the tax year or other taxable period through the end of the day on the Distribution Date.

 

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“Principal Ancillary
Agreements” means the Employee Matters Agreement and the Transition Services Agreement.

 

“Prior Tax Sharing
Agreement” means the Amended and Restated Tax Sharing Agreement dated as of September 1, 2010, by and between Exelon
and certain of its Subsidiaries.

 

“Proposed Acquisition
Transaction” means a transaction or series of transactions (i) as a result of which any of the Parties would merge
or consolidate with any other Person, or (ii) as a result of which any Person or any group of Persons would (directly or indirectly)
acquire, or have the right to acquire (through an option or otherwise), from any of the Parties or any of their Affiliates and/or one
or more holders of their stock, respectively, any amount of stock of any of the Parties that would, when combined with any other changes
in ownership of the stock of such Party during the Restricted Period, result in a shift of more than 40% of (a) the value of all
outstanding shares of stock of such Party as of the Distribution Date, or (b) the total combined voting power of all outstanding
shares of voting stock of such Party as of the Distribution Date. Notwithstanding the foregoing, a Proposed Acquisition Transaction shall
not include (i) the adoption by a Party of, or the issuance of stock pursuant to, a stockholder rights plan or (ii) transactions
that satisfy Safe Harbor VIII (relating to acquisitions in connection with a person’s performance of services, including Equity
Awards granted to employees of members of the Exelon Group or the Constellation Group) or Safe Harbor IX (relating to acquisitions by
a retirement plan of an employer) of Treasury Regulations Section 1.355-7(d). For purposes of determining whether and to what extent
a transaction constitutes an indirect acquisition for purposes of the first sentence of this definition, any recapitalization or other
action resulting in a shift of voting power or any redemption or repurchase of shares of stock shall be treated as an indirect acquisition
of shares of stock by the benefitted or non-exchanging stockholders. Notwithstanding the previous sentence, the effect of any such recapitalization,
other action, or redemption or repurchase (directly or indirectly) of shares shall take into account any applicable IRS ruling received
by one or more of the Parties with respect thereto. This definition and the application thereof is intended to monitor compliance with
Section 355(e) of the Code and the Treasury Regulations promulgated thereunder and shall be interpreted accordingly by the Parties
in good faith.

 

“Refund”
has the meaning prescribed in Section 2.06(a).

 

“Relative
Values” means the relative equity values of Exelon and Constellation determined in accordance with the following:
(a) for Exelon, such value shall be determined by multiplying (i) the average value of Exelon’s common stock for the three
Business Days following the Distribution Date, computed for each day by averaging the intraday high and intraday low trading price, by
(ii) the total number of shares of Exelon common stock outstanding on such date, and (b) for Constellation, such value shall
be determined by multiplying (i) the average value of the Constellation common stock for the three Business Days following the Distribution
Date, computed for each day by averaging the intraday high and intraday low trading price, by (ii) the total number of shares of
Constellation common stock outstanding on such date.

 

“Representation
Letters” means the Exelon Representation Letter and the Constellation Representation Letter.

 

“Responsible
Party” has the meaning prescribed in Section 5.03(a).

 

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“Restricted
Action” has the meaning prescribed in Section 4.03(a).

 

“Restricted
Period” means the period beginning at the Effective Time and ending on the two-year anniversary of the day after
the Distribution Date.

 

“Separation
Agreement” has the meaning set forth in the preamble.

 

“Separation
Taxes” means any federal, state, and local Income Tax imposed on or assessed against Exelon or the Exelon Combined
Group in connection with the Contribution and Distribution that would not have been imposed or assessed had the Contribution and Distribution
not occurred.

 

“Straddle
Period” means any taxable period beginning on or before the Distribution Date and ending after the Distribution Date.

 

“Subsidiary”
has the meaning set forth in the Separation Agreement.

 

“Tainting Act”
means any act, or failure or omission to act, by any Party (or any of its Subsidiaries) following the Distribution that results in any
member of the Exelon Group or any member of the Constellation Group being responsible for Separation Taxes pursuant to a Final Determination,
regardless of whether such act or failure or omission to act (i) is covered by a ruling from the IRS or an Unqualified Tax Opinion,
or (ii) occurs during or after the Restricted Period.

 

“Tax”
and “Taxes” means any income, gross income, gross receipts, profits, capital stock, franchise, withholding,
payroll, social security, workers’ compensation, unemployment, disability, property, ad valorem, value added, stamp, excise,
severance, occupation, service, sales, use, license, lease, transfer, import, export, alternative minimum, estimated or other tax (including
any fee, assessment, or other charge in the nature of or in lieu of any tax), imposed by any governmental entity or political subdivision
thereof, and any interest, penalty, additions to tax, or additional amounts in respect of the foregoing.

 

“Tax
Attributes” means all federal, state and local Tax attributes, including but not limited to net operating losses,
capital losses, tax credit carryovers, earnings and profits, overall foreign losses, previously taxed income, separate limitation losses,
deductions or other comparable items, and assets basis, that could affect a Tax liability for a past or future taxable period.

 

“Tax
Benefit” means any refund, credit, or other reduction in Tax payments otherwise required to be made to a Taxing Authority,
including for the avoidance of doubt, any actual Tax savings if, as and when realized arising from a step-up in Tax basis or an increase
in a Tax Attribute.

 

“Tax
Controversy” has the meaning prescribed in Section 5.01(a).

 

“Tax
Item” means any item of income, gain, loss, deduction, credit, recapture of credit, or any other item (including
the basis or adjusted basis of property) which increases or decreases Income Taxes paid or payable in any taxable period.

 

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“Tax Opinion”
means the opinion rendered by Sidley Austin LLP, with respect to certain Tax aspects of the Distribution.

 

“Tax
Proceeding” means any audit, assessment of Taxes, pre-filing agreement, other examination by any Taxing Authority,
proceeding, appeal of a proceeding or litigation relating to Taxes, whether administrative or judicial, including proceedings relating
to competent authority determinations.

 

“Tax
Return” means any return, report, certificate, form, filing, questionnaire or other document required to be filed
with or otherwise provided to any Taxing Authority, including requests for extensions of time, filings made with estimated Tax payments,
claims for Refund or amended returns, any related or supporting information or schedule attached thereto that may be filed or provided
for any taxable period in connection with any Tax or Taxes (whether or not a payment is required to be made with respect to such filing).

 

“Tax-Free
Status of the Transactions” means the tax-free treatment accorded to certain of the Transactions as set forth in
the IRS Ruling and the Tax Opinion.

 

“Taxing
Authority” means any national, municipal, governmental, state, federal or other body, or any quasi-governmental or
private body, having jurisdiction over the assessment, determination, collection or imposition of any Tax (including the IRS).

 

“Transactions”
has the meaning set forth in the Separation Agreement.

 

“Transfer Taxes”
has the meaning prescribed in Section 2.02(c).

 

“Treasury
Regulations” means the final and temporary (but not proposed) income tax regulations promulgated under the Code,
as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

 

“Unqualified Tax
Opinion” means a “will” opinion, without substantive qualifications, of an Advisory Firm, which Advisory Firm
is reasonably acceptable to Exelon, to the effect that a transaction will not affect the Tax-Free Status of the Transactions.

 

ARTICLE II

RESPONSIBILITY FOR TAXES

 

2.01          Responsibility
and Indemnification for Taxes.

 

(a)            From
and after the Distribution Date, without duplication, each of Exelon and Constellation shall be responsible for, and shall pay its respective
share of the liability for Taxes of Exelon, Constellation, and their respective Affiliates, as provided in this Agreement. Exelon and
its Affiliates shall indemnify and hold harmless Constellation and its Affiliates from and against any Taxes for which Exelon is responsible
pursuant to this Agreement, and Constellation and its Affiliates shall indemnify and hold harmless Exelon and its Affiliates from and
against any Taxes for which Constellation is responsible pursuant to this Agreement.

 

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(b)            Except
as otherwise provided in this Agreement, all references to Taxes or Tax liabilities in this Agreement refer to the actual amounts of Taxes
paid or due and do not apply to (i) the utilization, elimination, or adjustment of any Tax Attribute, or (ii) items or adjustments
to items shown solely on a Party’s balance sheet or other financial statement. There shall be no adjustments, payments, or obligations
among the Parties made pursuant to this Agreement for any gains or losses with respect to amounts shown on a Party’s balance sheet
or other financial statements and not specifically allocated herein, including but not limited to ASC 740-10 reserves, Deferred Tax Assets,
Deferred Tax Liabilities, and other Tax accounting entries.

 

(c)            Payments
to Taxing Authorities and between the Parties, as the case may be, shall be made in accordance with the provisions of this Agreement.

 

2.02          Responsibility
for Taxes.

 

(a)            Generally

 

(i)             Exelon.

 

Except as set forth in Sections 2.02(a)(ii),
2.02(b), 2.02(c), 2.05(b) or 5.01(b), Exelon shall be liable for and shall pay or cause to be paid the following
Taxes:

 

(A)            Income
Taxes (other than the Constellation Allocable Portion of such Income Taxes) due and payable in connection with Tax Returns for Pre-Distribution
Periods and Straddle Periods that Exelon is required to file or cause to be filed pursuant to Section 3.01;

 

(B)            Income
Taxes due and payable in connection with Tax Returns for Post-Distribution Periods (other than Straddle Periods) that Exelon is required
to file or cause to be filed pursuant to Section 3.01; and

 

(C)            Non-Income
Taxes (other than the Constellation Allocable Portion of such Non-Income Taxes) payable in connection with any other Tax Returns that
Exelon is required to file or cause to be filed pursuant to Section 3.01.

 

(ii)            Constellation.

 

Except as set forth in Sections 2.02(b),
2.02(c), 2.05(b) or 5.01(b) Constellation shall be liable for and shall pay or cause to be paid the following
Taxes:

 

(A)            Income
Taxes due and payable in connection with Tax Returns for Pre-Distribution Periods and Straddle Periods that Constellation is required
to file or cause to be filed pursuant to Section 3.01;

 

(B)            Income
Taxes due and payable in connection with Tax Returns for Post-Distribution Periods (other than Straddle Periods) that Constellation is
required to file or cause to be filed pursuant to Section 3.01;

 

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(C)            Non-Income
Taxes payable in connection with any other Tax Returns that Constellation is required to file or cause to be filed pursuant to Section 3.01;

 

(D)            the
Constellation Allocable Portion of any Income Taxes or Non-Income Taxes payable in connection with Tax Returns for Pre-Distribution Periods
and Straddle Periods that Exelon is required to file or cause to be filed pursuant to Section 3.01; and

 

(E)             the
Constellation Allocable Audit Portion of any Income Taxes or Non-Income Taxes.

 

(iii)            Straddle
Period Taxes. Subject to Section 2.04, the responsibility for any Tax incurred in a Straddle Period shall be allocated
between the Pre-Distribution Period and the Post-Distribution Period as if the relevant Person or Persons closed its financial accounting
records as of the Distribution Date and determined the Tax attributable to the Pre-Distribution Period by applying the method of tax accounting
that has historically been used for the business of such Person or Persons.

 

(b)             Separation
Taxes

 

(i)            In
the event that Separation Taxes become due and payable to a Taxing Authority pursuant to a Final Determination, then, notwithstanding
anything to the contrary in this Agreement:

 

(A)            if
such Separation Taxes are attributable to a Tainting Act of any member of the Exelon Group or to a transaction after the Distribution
Date involving the stock of any member of the Exelon Group (an “Exelon Tainting Act”), and are not also attributable
to a Tainting Act of any member of the Constellation Group or to a transaction after the Distribution Date involving the stock of any
member of the Constellation Group (a “Constellation Tainting Act”), then Exelon shall be responsible for such
Separation Taxes;

 

(B)            if
such Separation Taxes are attributable to a Constellation Tainting Act, and are not also attributable to an Exelon Tainting Act, then
Constellation shall be responsible for such Separation Taxes;

 

(C)            if
such Separation Taxes are attributable to both an Exelon Tainting Act and a Constellation Tainting Act, then such Separation Taxes shall
be equitably apportioned between the Parties based upon their relative fault; provided that in the event the Parties cannot agree
regarding their relative fault, the matter shall be resolved in accordance with Article VII; and

 

(ii)            if
such Separation Taxes are not attributable to an Exelon Tainting Act or a Constellation Tainting Act, then such Separation Taxes shall
be apportioned between the Parties based upon their Relative Values.

 

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(c)            Transfer
Taxes. Notwithstanding anything to the contrary herein, all transfer, documentary, sales, use, stamp, registration and other such
similar Taxes, and all conveyance fees, recording charges and other fees and charges (including any penalties and interest) incurred in
connection with consummation of the transactions contemplated by this Agreement, the Separation Agreement or the Ancillary Agreements
(“Transfer Taxes”) shall be paid 50% by Constellation and 50% by Exelon, and the Party required under applicable
Law to file Tax Returns with respect to Transfer Taxes will file all necessary Tax Returns, and, if required by applicable Law, the non-preparing
Party will, and will cause its Affiliates to, join in the execution of any such Tax Returns and other documentation; provided,
however, that if the non-preparing Party fails to join in the execution of any such Tax Returns and other documentation, then the
Party obligated to file such Tax Returns is authorized to execute such Tax Returns and other documentation on behalf of the non-preparing
Party.

 

2.03          Timing
Differences.

 

(a)            If
pursuant to a Determination an Adjustment (i) increases the amount of liability for any Taxes for which a member of the Exelon Group
is responsible hereunder and a Tax Benefit is made allowable to a member of the Constellation Group for any Post-Distribution Period,
which Tax Benefit would not have arisen or been allowable but for such Adjustment, and which Tax Benefit reduces Taxes in respect of a
Tax period for which any member of the Constellation Group is liable (and for which no member of the Exelon Group is liable) or (ii) increases
the amount of liability for any Taxes for which a member of the Constellation Group is responsible hereunder and a Tax Benefit is made
allowable to any member of the Exelon Group for any Pre-Distribution Period, which Tax Benefit would not have arisen or been allowable
but for such Adjustment, and which Tax Benefit reduces Taxes in respect of a Tax period for which a member of the Exelon Group is liable
(and for which no member of the Constellation Group is liable), then Constellation or Exelon, as the case may be, shall make a payment
to either Exelon or Constellation, as appropriate, within forty-five (45) days of the date that such paying Party (or any member of the
Exelon Group or Constellation Group, as applicable) actually receives such Tax Benefit (determined by comparing its Tax liability with
and without the Tax consequences of the Adjustment), which payment shall not exceed the increase in the amount of liability for any Taxes
resulting from such Adjustment, for which a member of the Exelon Group or Constellation Group, is responsible hereunder.

 

2.04          Allocation
of Certain Income Taxes and Income Tax Items.

 

(a)            If
Exelon, Constellation, or any of their respective Affiliates is permitted but not required under applicable federal, state, local or foreign
Tax Laws to treat the Distribution Date as the last day of a taxable period, then, in accordance with Section 2.02(a)(iii),
the Parties shall (or shall cause its Affiliates to) treat such day as the last day of a taxable period under such applicable Tax Law,
and shall file or cause to be filed any elections necessary or appropriate to such treatment; provided that this Section 2.04(a) shall
not be construed to require Exelon or Constellation to change its taxable year.

 

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(b)            Tax
Attributes arising in a Pre-Distribution Period shall be allocated to the Exelon Group and Constellation Group in accordance with principles
set forth in the Prior Tax Sharing Agreement, unless otherwise required by the Code and Treasury Regulations (and any applicable state,
local, and non-U.S. Laws). Exelon and Constellation shall jointly determine the allocation of such Tax Attributes arising in Pre-Distribution
Periods as soon as reasonably practicable following the Distribution Date, and hereby agree to compute all Taxes for Post-Distribution
Periods consistently with that determination unless otherwise required by a Determination.

 

(c)            The
Parties agree that, in connection with the Distribution, Exelon’s current and accumulated earnings and profits will be allocated
between Exelon and Constellation based on their relative fair market values at the time of the Distribution in accordance with Treasury
Regulation § 1.312-10.

 

2.05          Treatment
of Equity Awards and Compensatory Payments.

 

(a)            For
all Post-Distribution Periods, solely the Party (or its Subsidiary) that then employs or engages the relevant individual or, if such individual
is not then employed or engaged by a Party, the Party (or its Subsidiary) that most recently employed or engaged such individual, at the
time of the vesting, exercise, disqualifying disposition, payment or other relevant taxable event, as appropriate, in respect of the Equity
Awards and all other nonqualified deferred compensation plans and Non-ERISA Benefit Arrangements described in Sections 3.3 and Article V
the Employee Matters Agreement (“Other Compensatory Payments”), shall be entitled to claim any Income Tax deduction
arising after the Distribution Date in respect of such Equity Awards and Other Compensatory Payments on its respective Tax Return.

 

(b)            The
Party (or its Subsidiary) that claims the deduction described in Section 2.05(a) shall be responsible for all applicable
Taxes (including withholding and excise taxes) and shall satisfy, or shall cause to be satisfied, all applicable Tax reporting obligations
in respect of the Equity Awards and Other Compensatory Payments that gives rise to the deduction. The Parties shall cooperate (and shall
cause their Subsidiaries to cooperate) so as to permit the Party (or Subsidiary thereof) claiming such deduction described in Section 2.05(a) to
discharge any applicable Tax withholding and Tax reporting obligations, including the appointment of the Party claiming the deduction
(or its Subsidiary) as the withholding and reporting agent if that Party (or any of its Subsidiaries) is not otherwise required or permitted
to withhold and report under applicable Law.

 

2.06          Tax
Refunds and Certain Tax Attributes.

 

(a)            Except
as otherwise provided in this Article II, the benefit of any Tax credits, Tax Attributes, and any refund or credit of any
overpayment of Taxes or estimated Tax liabilities (each, a “Refund”), including any corresponding benefit arising
out of or related to any Tax liability that is the subject of this Agreement, will remain with the Party entitled to the benefit under
applicable Tax Law. No payments shall be made between the Parties to account for such adjustment.

 

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(b)            Except
as provided in Section 2.07, Exelon shall be entitled to all Refunds for Taxes for which Exelon is responsible pursuant to
Article II, and Constellation shall be entitled to (i) all Refunds for Taxes for which Constellation is responsible pursuant
to Article II and (ii) the amount of any actual reduction in the cash Tax liability of Exelon or its Affiliates following
the Distribution Date to the extent attributable to the utilization of Constellation Tax Credit Carryforwards. A Party receiving a Refund
or the benefit of a Constellation Tax Credit Carryforward to which the other Party is entitled pursuant to this Agreement shall (x) notify
the other Party within thirty (30) days of the Receipt of such Refund (or the reduction in any Tax payment as a result of any Constellation
Tax Credit Carryforward) and (y) pay the amount to which such other Party is entitled within forty-five (45) days after the
receipt of the Refund or the utilization of such Constellation Tax Credit Carryforward. Each Party shall cooperate in good faith to secure
any Refunds for Taxes to which the other Party may be entitled; provided, however, that Exelon may, in its reasonable discretion,
determine not to seek a Refund on behalf of Constellation if obtaining such Refund would require any member of the Exelon Group to file
an amended Tax Return.

 

(c)            In
the event of an Adjustment relating to Taxes for which one Party is responsible pursuant to Article II which would have given
rise to a Refund but for an offset against the Taxes for which the other Party is or may be responsible pursuant to Article II
(the “Benefited Party”), then the Benefited Party shall pay to the other Party, within forty-five (45) days
of the Determination of such Adjustment an amount equal to the lesser of (i) the amount of such hypothetical Refund or (ii) the
amount of such reduction in the Taxes of the Benefited Party, in each case, plus interest at the Interest Rate on such amount for the
period from the filing date of the Tax Return that would have given rise to such Refund to the payment date.

 

(d)            Notwithstanding
Section 2.06(a), to the extent that a Party applies or causes to be applied an overpayment of Taxes as a credit toward or
a reduction in Taxes otherwise payable (or a Taxing Authority requires such application in lieu of a Refund) and such overpayment of Taxes,
if received as a Refund, would have been payable by such Party to the other Party pursuant to this Section 2.06, such Party
shall pay such amount to the other Party no later than the due date of the Tax Return for which such overpayment is applied to reduce
Taxes otherwise payable.

 

(e)            To
the extent that the amount of any Refund or Constellation Tax Credit Carryforward under this Section 2.06 or Section 2.07(b)(i),
as applicable, is later reduced by a Taxing Authority or in a Tax Proceeding, such reduction (together with any corresponding interest,
penalties, or additions to Tax) shall be allocated to the Party to which such Refund or Constellation Tax Credit Carryforward was allocated
pursuant to this Section 2.06 or Section 2.07(b)(i), as applicable, and an appropriate adjusting payment shall
be made.

 

2.07          Carrybacks.

 

(a)            The
carryback of any loss, credit, or other Tax Attribute from any Post-Distribution Period shall be in accordance with the provisions of
the Code and Treasury Regulations (and any applicable state, local, or non-U.S. Law).

 

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(b)

 

(i)            Subject
to Section 2.07(c) and (d), in the event that any member of the Constellation Group realizes any loss, credit,
or other Tax Attribute in a Post-Distribution Period of such member, such member may elect to carry back such loss, credit, or other Tax
Attribute to a Pre-Distribution Period or Straddle Period of Exelon. Exelon shall cooperate with Constellation and such member in seeking
from the appropriate Taxing Authority any Refund that reasonably would result from such carryback (including by filing an amended Tax
Return) at Constellation’s cost and expense; provided, however, that Exelon shall not be required to seek such Refund,
and Constellation and such member shall not be permitted to seek or otherwise be entitled to such Refund, in each case to the extent that
such Refund would reasonably be expected to materially adversely impact Exelon (including through an increase in Taxes or a loss or reduction
of a Tax Attribute regardless of whether or when such Tax Attribute otherwise would have been used), without the prior written consent
of Exelon, which consent shall not be unreasonably withheld or delayed. Subject to the foregoing, Constellation (or such member) shall
be entitled to any Refund realized by any member of the Exelon Group or the Constellation Group resulting from such carryback.

 

(ii)            Subject
to Section 2.07(c) and (d), in the event that any member of the Exelon Group realizes any loss, credit or other
Tax Attribute in a Post-Distribution Period of such member, such member may elect to carry back such loss, credit or other Tax Attribute
to a Pre-Distribution Period or Straddle Period of such member. Constellation shall cooperate with Exelon and such member in seeking from
the appropriate Taxing Authority any Refund that reasonably would result from such carryback (including by filing an amended Tax Return)
at Exelon’s cost and expense; provided, however, that Constellation shall not be required to seek such Refund and
Exelon and such member shall not be permitted to seek or otherwise be entitled to such Refund, in each case to the extent that such Refund
would reasonably be expected to materially adversely impact Constellation (including through an increase in Taxes or a loss or reduction
of a Tax Attribute regardless of whether or when such Tax Attribute otherwise would have been used), without the prior written consent
of Constellation, which consent shall not be unreasonably withheld or delayed. Subject to the foregoing, Exelon (or such member) shall
be entitled to any Refund realized by any member of the Constellation Group or the Exelon Group resulting from such carryback.

 

(c)            Except
as otherwise provided by applicable Law, if any loss, credit or other Tax Attribute of the Exelon Business and the Constellation Business
both would be eligible to be carried back or carried forward to the same Pre-Distribution Period (had such carryback been the only carryback
to such taxable period), any Refund resulting therefrom shall be allocated between Exelon and Constellation proportionately based on the
relative amounts of the Refunds to which the Exelon Business and the Constellation Business, respectively, would have been entitled had
such carryback been the only carryback to such taxable period.

 

(d)            To
the extent the amount of any Refund under this Section 2.07 is later reduced by a Taxing Authority or a Tax Proceeding, such
reduction (together with any corresponding interest, penalties, or additions to Tax) shall be allocated to the Party to which such Refund
was allocated pursuant to this Section 2.07, and an appropriate adjusting payment shall be made.

 

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2.08         Protective
Section 336(e) Elections.

 

(a)            Exelon
and Constellation shall make a protective election with respect to Constellation under Section 336(e) of the Code (and any similar
election under state or local Law) with respect to the Distribution in accordance with Treasury Regulations Section 1.336-2(h) and
(j) (and any applicable provisions under state and local Law) and shall fully cooperate in the timely completion and/or filings of
such elections and any related filings or procedures (including filing or amending any Tax Returns to implement an election that becomes
effective). This Section 2.08(a) is intended to constitute a binding, written agreement to make an election under Section 336(e) of
the Code with respect to the Distribution.

 

(b)            Notwithstanding
anything to the contrary herein, in the event that the election contemplated in Section 2.08(a) is made and becomes effective,
then the Parties shall share in any Tax Benefit derived as a result of such election in accordance with the Parties’ relative responsibility
for such Taxes under this Article II, and payments shall be made between the Parties, if necessary.

 

(c)            Exelon
and Constellation shall cooperate in good faith in order to determine whether to make a protective election under Section 336(e) of
the Code (and any similar election under state or local Law) with respect to any subsidiary of Constellation in accordance with Treasury
Regulations Section 1.336-2(h) and (j) (and any applicable provisions under state and local Law).

 

ARTICLE III

TAX RETURNS AND INFORMATION EXCHANGE

 

3.01          Tax
Return Preparation Responsibility; Payment of Taxes Shown Thereon.

 

(a)            Except
as provided in Section 3.01(b), Exelon shall prepare and timely file all Tax Returns for Pre-Distribution Periods for Exelon
and its Affiliates, including Constellation and its Affiliates, and all Tax Returns for Straddle Periods for all members of the Exelon
Group. In connection with each Tax Return that is required under this Agreement to be filed by Exelon for Pre-Distribution Periods or
Straddle Periods, Constellation shall timely furnish to Exelon such Tax information and documents as Exelon may reasonably request.

 

(b)            Constellation
and its Affiliates shall prepare and timely file all Constellation Separate Tax Returns, including any such Tax Return with respect to
a Pre-Distribution Period. If any Constellation Separate Tax Return relates in whole or in part to any Pre-Distribution Period, Constellation
shall provide Exelon with a copy of such Tax Return at least sixty (60) days prior to its due date. Exelon shall notify Constellation
of any disagreement within twenty (20) days of Exelon’s receipt of such Tax Return. Any dispute shall be resolved pursuant
to the procedures provided by this Agreement.

 

(c)            Except
at the written direction of Exelon or to the extent permitted pursuant to Section 2.07, after the date of the Distribution,
Constellation shall not file (or allow any Affiliate of Constellation to file) any amended Tax Return or Refund claim for any Pre-Distribution
Periods.

 

(d)            Exelon
(and its Affiliates) shall be responsible for remitting payment of any Taxes shown on a Tax Return which Exelon (or any of its Affiliates)
is responsible for filing pursuant to this Agreement. Constellation (and its Affiliates) shall be responsible for remitting payment of
any Taxes shown on a Tax Return which Constellation (or any of its Affiliates) is responsible for filing pursuant to this Agreement.

 

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(e)            If
Exelon (or any of its Affiliates) remits a Tax payment, but Constellation (or any of its Affiliates) is responsible pursuant to Article II
for all or a portion of the Tax shown on the applicable Tax Return, then Constellation shall timely pay to Exelon that portion of the
Tax for which Constellation (or any of its Affiliates) is responsible. Such payments shall be requested and made in accordance with the
notice and payment provisions contained in Article VI. Nothing in this Section 3.01 shall affect the allocation
of responsibility for Taxes as set forth in Article II.

 

3.02          Certain
Items Related to Tax Return Preparation.

 

(a)            All
Tax Returns relating to a Pre-Distribution Period shall be prepared and filed by the specified party in a manner consistent with past
Tax reporting practices of the Exelon Group or the Constellation Group, as applicable.

 

(b)            Unless
otherwise required by a Taxing Authority, the Parties hereby agree to prepare and file all Tax Returns, and to take all other actions,
in a manner consistent with this Agreement, the Separation Agreement, the Principal Ancillary Agreements, applicable Law, the Tax Opinion,
any Representation Letter, the IRS Ruling, and the IRS Ruling Request. All Tax Returns shall be filed on a timely basis (taking into account
applicable extensions) by the party responsible for filing such Tax Returns under this Agreement; provided, however, that
if a Tax Return is to be signed by an officer of an entity different from the party responsible for filing such Tax Return, the appropriate
Party shall have (or cause its Affiliate to have) the appropriate officer sign such Tax Return promptly after presentation thereof for
signature.

 

(c)            Except
as otherwise specifically provided for in this Agreement (including Section 2.06 and Sections 3.02(a) and (b)),
each Party shall have the exclusive right, in its reasonable discretion, with respect to any Tax Return for which it is responsible for
the filing thereof pursuant to this Agreement, to determine (i) the manner in which such Tax Return shall be prepared and filed,
including the accounting methods, positions, conventions and principles of taxation to be used and the manner in which any Tax Item shall
be reported; (ii) whether any extensions may be requested; (iii) the election(s) that will be made by Exelon, Constellation,
or any of their Affiliates on such Tax Return; (iv) whether any amended Tax Return shall be filed; (v) whether any claim for
Refund shall be made; (vi) whether any Refund shall be paid by way of refund or credited against any liability for the related Tax;
and (vii) whether to retain outside firms to prepare or review such Tax Returns.

 

(d)            Exelon
shall advise Constellation within five (5) Business Days of the filing of any amended Tax Return relating to the Exelon Combined
Group for a Pre-Distribution Period if such amended Tax Return could reasonably be expected to affect any Tax Attribute of any member
of the Constellation Group for any Post-Distribution Period.

 

(e)            Nothing
in this Agreement shall be construed as a guarantee or representation of the existence or amount of any loss, credit, carryforward, basis,
or other Tax Item or Tax Attribute, whether past, present, or future, of Exelon, Constellation, or their respective Affiliates.

 

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ARTICLE IV

TAX TREATMENT OF THE DISTRIBUTION

 

4.01          Representations.

 

(a)            Constellation.
Constellation hereby represents and warrants to Exelon as of the date hereof and as of the Distribution Date as follows:

 

(i)            Tax-Free
Status. Constellation has no plan or intention of taking any action, or failing or omitting to take any action, or knows of any
circumstance, that could reasonably be expected to (i) cause the Contribution and the Distribution to fail to qualify as a reorganization
within the meaning of Sections 368(a)(1)(D) and 355 of the Code or (ii) cause any representation or factual statement made
in this Agreement, the Separation Agreement, the Principal Ancillary Agreements, the Tax Opinion, the IRS Ruling, or any Constellation
Representation Letter, as applicable, to be untrue in a manner that would have an adverse effect on the qualification of the Contribution
and the Distribution as a reorganization within the meaning of Sections 368(a) (1)(D) and 355 of the Code or the tax treatment
described in the Tax Opinion or the IRS Ruling.

 

(ii)             Plan
or Series of Related Transactions.

 

(A)            To
the knowledge of Constellation and the management of Constellation, neither the Distribution nor any related transactions are part of
a plan (or series of related transactions) pursuant to which a Person will acquire directly or indirectly stock representing a 50% or
greater interest (within the meaning of Sections 355(d) and (e) of the Code) in Constellation or any successor to Constellation.

 

(B)            Constellation
has no plan or intention to participate in, facilitate, undertake, or otherwise permit any acquisition of Constellation after the Distribution
pursuant to which a direct or indirect acquisition of stock of Constellation would occur, which would result in a direct or indirect acquisition
of stock representing a 50% or greater interest (within the meaning of Sections 355(d) and 355(e) of the Code) in Constellation
or any successor to Constellation.

 

(C)            Constellation
and its Affiliates have no plan or intention to redeem, purchase, or otherwise reacquire 20% or more of the capital stock of Constellation
in one or more transactions following the Distribution Date.

 

(D)            Constellation
and its Affiliates have no plan or intention to (i) sell, exchange, distribute, or otherwise dispose of, directly or indirectly,
other than in the ordinary course of business, all or a substantial part of the assets of any Active Business; (ii) discontinue or
cause to be discontinued the active conduct of any Active Business; or (iii) cause the occurrence of any restructuring pursuant to
which Constellation ceases to be treated as conducting any Active Business.

 

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(b)             Exelon.
Exelon hereby represents and warrants to Constellation as of the date hereof and as of the Distribution Date as follows:

 

(i)            Tax-Free
Status. Exelon has examined the IRS Ruling, each IRS Ruling Request, the Tax Opinion and any other materials delivered or deliverable
in connection with the rendering of the Tax Opinion, and Exelon has no plan or intention of taking any action, or failing or omitting
to take any action, or knows of any circumstance, that could reasonably be expected to (i) cause the Contribution and the Distribution
to fail to qualify as a reorganization within the meaning of Sections 368(a)(1)(D) and 355 of the Code, or (ii) cause any
representation or factual statement made in the Separation Agreement, this Agreement, the other Ancillary Agreements, the Tax Opinion,
or any Exelon Representation Letter, as applicable, to be untrue in a manner that would have an adverse effect on the qualification of
the Contribution and the Distribution as a reorganization within the meaning of Sections 368(a)(1)(D) and 355 of the Code or
the tax treatment described in the Tax Opinion or the IRS Ruling.

 

(ii)            Plan
or Series of Related Transactions.

 

(A)            To
the knowledge of Exelon and the management of Exelon, neither the Distribution nor any related transactions are part of a plan (or series
of related transactions) pursuant to which a Person will acquire directly or indirectly stock representing a 50% or greater interest (within
the meaning of Sections 355(d) and (e) of the Code) in Exelon or any successor to Exelon.

 

(B)            Exelon
has no plan or intention to participate in, facilitate, undertake or otherwise permit any acquisition of Exelon after the Distribution
pursuant to which a direct or indirect acquisition of stock of Exelon would occur, which would result in a direct or indirect acquisition
of stock representing a 50% or greater interest (within the meaning of Sections 355(d) and 355(e) of the Code) in Exelon
or any successor to Exelon.

 

(C)            Exelon
and its Affiliates have no plan or intention to redeem, purchase or otherwise acquire 20% or more of Exelon’s capital stock in one
or more transactions following the Distribution Date.

 

(D)            Exelon
and its Affiliates have no plan or intention to (i) sell, exchange, distribute, or otherwise dispose of, directly or indirectly,
other than in the ordinary course of business, all or a substantial part of the assets of any Active Business; (ii) discontinue or
cause to be discontinued the active conduct of any Active Business; or (iii) cause the occurrence of any restructuring pursuant to
which Exelon ceases to be treated as conducting any Active Business.

 

4.02          Covenants.

 

(a)            The
Parties shall not, and shall cause their Affiliates not to, take any action or fail to take any action, where such action or failure would
be inconsistent with or have an adverse effect on the qualification of the Contribution and the Distribution as a reorganization within
the meaning of Sections 368(a)(1)(D) and 355 of the Code or the tax treatment described in the Tax Opinion or the IRS Ruling.

 

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(b)            Actions
Consistent with Representations and Covenants.

 

(i)            Constellation
shall not, and shall not permit any of its Affiliates to, take any action or fail to take any action, where such action or failure to
act would be inconsistent with or cause to be materially untrue any material, information, covenant, or representation in the Separation
Agreement, this Agreement, the other Ancillary Agreements, the Tax Opinion, the IRS Ruling, the IRS Ruling Request or any Constellation
Representation Letter.

 

(ii)           Exelon
shall not, and shall not permit any of its Affiliates to, take any action or fail to take any action, where such action or failure to
act would be inconsistent with or cause to be materially untrue any material, information, covenant, or representation in the Separation
Agreement, this Agreement, the other Ancillary Agreements, the Tax Opinion, the IRS Ruling, the IRS Ruling Request, or any Exelon Representation
Letter.

 

(c)            Notwithstanding
anything herein to the contrary, but subject to Section 4.03(a), during the Restricted Period, Constellation shall not (and
shall not allow any of its subsidiaries or Affiliates to):

 

(i)            allow
any Proposed Acquisition Transaction to occur;

 

(ii)           merge
or consolidate with any other Person or dissolve, liquidate or partially liquidate (other than a wholly owned subsidiary of Constellation
merging or consolidating with Constellation or another wholly owned subsidiary of Constellation);

 

(iii)          approve
or allow the discontinuance, cessation, or sale or other transfer (to an Affiliate or otherwise) of any Active Business conducted by Constellation
or its Affiliates, as applicable;

 

(iv)          sell
or otherwise dispose of more than 40% of its consolidated gross or net assets or allow the sale or other disposition (to an Affiliate
or otherwise) of more than 40% of the consolidated gross or net assets of Constellation (in each case, excluding sales in the ordinary
course of business, sales the net cash proceeds (taking into account any Taxes payable) of which are reinvested in other assets (including
pursuant to an exchange under Section 1031 of the Code) and sales the net cash proceeds (taking into account any Taxes payable) of
which are used to repay indebtedness, and measured based on fair market values as of the date of the Distribution or other transaction);

 

(v)           amend
its certificate of incorporation or take any similar action that affects the rights of stockholders under the certificate of incorporation;

 

(vi)          purchase,
directly or through any Affiliate, any of its outstanding stock after the Distribution, other than through stock purchases meeting the
requirements of Section 4.05(1)(b) of Revenue Procedure 96-30 (as in effect prior to the amendment of such Revenue Procedure
by Revenue Procedure 2003-48);

 

(vii)         take
any action or fail to take any action, or permit any of its Affiliates to take any action or fail to take any action, that is inconsistent
with the representations and covenants made in the Representation Letters, or that is inconsistent with the Tax Opinion; nor

 

(viii)        enter
into an arrangement or agreement to do any of the foregoing.

 

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4.03          Procedures
Regarding Opinions.

 

(a)            Constellation
shall be permitted to take or allow the actions described in Section 4.02 (each, a “Restricted Action”)
if, prior to taking or allowing any such Restricted Action, Constellation shall (1) have received written consent from Exelon, which
consent may be withheld in the sole discretion of Exelon, (2) have received a favorable private letter ruling from the IRS that confirms
that such Restricted Action will not, when considered together with any other relevant transactions, result in Separation Taxes (a “Post-Distribution
Ruling”), in form and substance satisfactory to Exelon in its discretion, which discretion shall be reasonably exercised
in good faith solely to ensure that the Restricted Action does not result in the imposition on either Party, or responsibility for payment
by either Party, of Separation Taxes or (3) have received an Unqualified Tax Opinion that confirms that such Restricted Action will
not result in Separation Taxes, when considered together with any other relevant transactions, in form and substance satisfactory to Exelon
in its discretion, which discretion shall be reasonably exercised in good faith solely to ensure that the Restricted Action does not result
in the imposition on either Party, or responsibility for payment by either Party, of Separation Taxes. Constellation shall provide a copy
of the Post-Distribution Ruling or the Unqualified Tax Opinion described in this Section 4.03(a) to Exelon as soon as
practicable prior to taking or failing to take any Restricted Action. Exelon’s evaluation and approval of such Post-Distribution
Ruling or Unqualified Tax Opinion shall not be unreasonably withheld or delayed; provided, however, that Exelon’s
evaluation of such Post-Distribution Ruling or Unqualified Tax Opinion may consider, among other factors, the appropriateness of any underlying
assumptions, representations, and covenants made in connection with such Post-Distribution Ruling or Unqualified Tax Opinion. Constellation
shall bear all costs and expenses of requesting and securing any such Post-Distribution Ruling or Unqualified Tax Opinion and shall reimburse
Exelon for all reasonable out-of-pocket costs and expenses that Exelon may incur in seeking to obtain or evaluate any such Post-Distribution
Ruling or Unqualified Tax Opinion.

 

(b)            If
Constellation notifies Exelon that it desires to take or permit a Restricted Action, Exelon shall reasonably cooperate with Constellation
and use its commercially reasonable efforts to seek to obtain, as expeditiously as possible, a Post-Distribution Ruling or an Unqualified
Tax Opinion for the purpose of permitting Constellation to take the Restricted Action unless Exelon shall have waived the requirement
to obtain such Post-Distribution Ruling or Unqualified Tax Opinion. If such a Post-Distribution Ruling is to be sought, Exelon shall apply
for such ruling and Exelon and Constellation shall jointly control the process of obtaining such ruling. In no event shall Exelon be required
to file any ruling request under this Section 4.03 unless Constellation represents that (i) it has reviewed such ruling
request, and (ii) all information and representations, if any, relating to any member of the Constellation Group, contained in such
ruling request documents are (subject to any qualifications therein) true, correct, and complete. Constellation shall reimburse Exelon
for all costs and expenses incurred by the Exelon Group in applying for and obtaining a Post-Distribution Ruling or an Unqualified Tax
Opinion requested by Constellation within forty-five (45) days after receiving any invoice from Exelon therefor.

 

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(c)            If
Exelon requests a Post-Distribution Ruling or other guidance pursuant to Section 4.03: (A) Exelon shall keep Constellation
reasonably informed in a timely manner of all material actions taken or proposed to be taken by Exelon in connection therewith; (B) Exelon
shall (i) reasonably in advance of the submission of any documents relating to the ruling provide Constellation with a draft thereof,
(ii) reasonably consider Constellation’s comments to such draft, (iii) provide Constellation with a final copy of any
documents relating to the ruling, (iv) provide Constellation with notice reasonably in advance of, and Constellation shall have the
right to attend, any meetings with the Taxing Authority (subject to the approval of the Taxing Authority) that relate to such ruling,
and (v) provide Constellation with a copy of such ruling.

 

4.04          Enforcement.
The Parties acknowledge that irreparable harm would occur in the event that any of the provisions of this Article IV were
not performed in accordance with their specific terms or were otherwise breached. The Parties agree that, in order to preserve the qualification
of the Contribution and the Distribution as a reorganization within the meaning of Sections 368(a)(1)(D) and 355 of the Code,
injunctive relief is appropriate to prevent any violation of the foregoing covenants; provided, however, that injunctive
relief shall not be the exclusive legal or equitable remedy for any such violation.

 

ARTICLE V

COOPERATION AND EXCHANGE OF INFORMATION

 

5.01          Cooperation.

 

(a)            Notwithstanding
anything to the contrary in the Separation Agreement or the Ancillary Agreements, Exelon and Constellation shall cooperate (and shall
cause each of their respective Affiliates to cooperate) fully at such time and to the extent reasonably requested by the other Party in
connection with the preparation and filing of any Tax Return or the conduct of any Tax Controversy, including any audit, protest, or claim
for Refund, competent authority proceeding, or litigation in Tax court or any other court of competent jurisdiction (a “Tax
Controversy”) (including providing a power of attorney) concerning any issues or any other matter contemplated under this
Agreement or otherwise as reasonably requested by the other Party. Each Party shall make its employees and facilities available on a mutually
convenient basis to facilitate such cooperation.

 

(b)            Notwithstanding
anything to the contrary in this Agreement, if a Party materially fails to comply with any of its obligations set forth in this Section 5.01,
upon reasonable request and notice by the other Party, the non-performing Party shall (i) reimburse the other Party for any internal
or incremental costs incurred by such other Party in having its employees or agents view or obtain such material, and (ii) to the
extent such failure results in the imposition of additional Taxes or the inability to obtain a Refund, be liable in full for such additional
Taxes or failure to obtain a Refund.

 

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5.02          Retention
of Records.

 

(a)            The
Parties and their Affiliates shall retain and provide to one another on demand books, records, documentation, information, or other materials
(including computer data) relating to any Tax Return, or any supplemental information necessary or reasonably helpful to support any position
taken therein until the later of (x) the expiration of the applicable statute of limitations (giving effect to any extension, waiver,
or mitigation thereof) or (y) in the event any claim has been made under this Agreement for which such information is relevant, the
occurrence of a Final Determination with respect to such claim.

 

(b)            The
Parties shall retain and make available to one another and to Taxing Authority, records and documentation that specifically include information
regarding the amount, basis, and fair market value of all assets exchanged in the Contribution, and relevant facts regarding any liabilities
assumed or extinguished as part of Contribution, pursuant to Treasury Regulation Section 1.355-5(d).

 

(c)            If
at any time after the Distribution Date a Party proposes to destroy materials or information required to be retained pursuant to Section 5.02(a),
it shall first notify the other Party in writing and such other Party shall be entitled to receive such materials or information proposed
to be destroyed if such materials or information relate to the other Party or any of its Affiliates or any assets held by the other Party’s
or any of its Affiliates.

 

5.03          Contest
Provisions.

 

(a)            The
Party responsible for Taxes under Article II (the “Responsible Party”) shall, with respect to a
Tax Return, have the exclusive right to control, contest and represent the interests of Exelon, Constellation, and their respective Affiliates
in any Tax Controversy related to such Tax Return; provided, however, that Exelon shall in all events be the Responsible
Party with respect to any Tax Return reflecting Separation Taxes. Such right to control shall include the right, in the Responsible Party’s
reasonable discretion, to waive or extend any statute of limitations in connection with any Tax Controversy and to resolve, settle or
agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Tax Controversy;
provided, however, that (i) at the request of Exelon or at Constellation’s option, Constellation shall have the
right, at its own expense, to reasonably participate (to the extent allowed by Law) in the contest of a Tax Controversy relating to Separation
Taxes and Taxes described in Sections 2.02(a)(i)(A) and (C) and (ii) at Exelon’s option, Exelon shall
have the right, at its own expense, to reasonably participate (to the extent allowed by Law) in the contest of a Tax Controversy relating
to Taxes described in Sections 2.02(a)(ii)(A).

 

(b)            Exelon
shall use reasonable efforts to keep Constellation advised as to the status of Tax Controversies involving (i) any issue that relates
to a Tax of any member of the Constellation Group or that could reasonably be expected to give rise to a liability of Constellation or
any of its Affiliates under this Agreement (in each case, a “Liability Issue”) or (ii) that could reasonably
be expected to affect any Tax Attribute of any member of the Constellation Group for any Post-Distribution Period (an “Attribute
Issue”). Exelon shall promptly furnish to Constellation copies of any inquiries or requests for information from any Taxing
Authority or any other administrative, judicial, or other governmental authority concerning any Liability Issue or Attribute Issue pertaining
to Constellation. Exelon shall use reasonable efforts to provide the information described in this Section 5.03(b) to
Constellation no later than ten (10) Business Days after becoming aware of, or in possession of, such information.

 

    22

     

    

 

(c)            Except
as otherwise set forth in Section 5.03(a), any costs and expenses incurred by a Responsible Party in connection with a Tax
Controversy shall be borne solely by the Responsible Party; provided, however, that Constellation shall reimburse Exelon
for its share of any reasonable third party costs and expenses borne by Exelon or its Affiliates in connection with Tax Controversies
relating to Taxes described in Section 2.02(a)(i)(A) and (C). For purposes of this Section 5.03(c),
Constellation’s share of third party costs and expenses shall be determined by reference to the Constellation Allocable Audit Portion
of the total amount Taxes due as a result of such Tax Controversy.

 

5.04          Reasonable
Participation; Information Sharing.

 

(a)            In
the event that Constellation elects or is required to participate in the defense of a Tax Controversy pursuant to Section 5.03(a),
Exelon shall (i) provide Constellation with notice at least ten (10) Business Days in advance of any proceeding relating to
such Tax Controversy, and (ii) consult in good faith with Constellation on the resolution of the Tax Controversy and on any written
submissions in connection with such Tax Controversy.

 

(b)            Exelon
shall advise Constellation in the event that Exelon reasonably determines that a Determination of Tax relating to the Exelon Combined
Group may affect any Liability Issue or Attribute Issue within five (5) Business Days after such Determination.

 

5.05          Information
for Shareholders.

 

(a)            Exelon
shall provide each shareholder that receives Constellation stock pursuant to the Distribution with the information necessary for such
shareholder to comply with the requirements of Section 355 of the Code and the Treasury Regulations thereunder with respect to statements
that such shareholders must file with their federal income Tax Returns demonstrating the applicability of Section 355 of the Code
to the Distribution.

 

(b)            Exelon
shall make available on its website the information required by Section 6045B of the Code with respect to the effect of the Distribution
on the basis of Exelon and Constellation stock in the hands of a U.S. taxpayer.

 

ARTICLE VI

INDEMNITY OBLIGATIONS AND PAYMENTS

 

6.01          Indemnity
Obligations.  In addition to the obligations set forth in Article II,

 

(a)            The
Exelon Group shall indemnify and hold harmless Constellation and any member of the Constellation Group from and against any liability,
cost, or expense, including, without limitation, any fine, penalty, interest, charge, or accountant’s fee, arising out of fraudulent
or negligent preparation of any Tax Return or claim for Refund filed by Exelon or any of its Affiliates for any period during which Constellation
or any member of the Constellation Group was or has been a member of the Exelon Combined Group, or arising out of the untimely provision
of information required to be provided under this Agreement.

 

    23

     

    

 

(b)            The
Constellation Group shall indemnify and hold harmless Exelon and any member of the Exelon Group from and against any liability, cost,
or expenses, including, without limitation, any fine, penalty, interest, charge, or accountant’s fee, arising out of fraudulent
or negligent information, workpapers, documents, and other items prepared by Constellation or any Affiliate of Constellation used in the
preparation of any Tax Return or claim for Refund filed by Exelon or any Affiliate of Exelon for any period during which Constellation
or any Affiliate of Constellation was or has been a member of the Exelon Combined Group, or arising out of the untimely provision of information
required to be provided under this Agreement.

 

6.02          Notice.
A Party making a claim for indemnification under this Agreement (the “Indemnified Party”) shall provide the
Party from whom such indemnification is sought (the “Indemnifying Party”) with written notice of such claim
describing such claim in reasonable detail and accompanied by reasonable documentation supporting such claim no later than twenty (20) calendar
days after the Indemnified Party (i) files a Tax Return reporting Taxes due which are subject to reimbursement, or (ii) receives
written notice from any Taxing Authority with respect to a Final Determination of Taxes that may be subject to indemnification under this
Agreement; provided, however, that in the event that timely notice is not provided, the Indemnifying Party shall be relieved
of its obligation to indemnify the Indemnified Party only to the extent that such delay results in actual increased costs or actual prejudice.

 

6.03          Payment.
In the event that the Indemnifying Party is required to make a payment to the Indemnified Party pursuant to this Agreement, then to the
extent not otherwise provided for in this Agreement or in the Separation Agreement, such payment shall be made according to this Section 6.03.

 

(a)            All
payments shall be made to the Indemnified Party or to the appropriate Taxing Authority as specified by the Indemnified Party within the
time prescribed for such payment in this Agreement, or if no period is prescribed, within twenty (20) calendar days after delivery
of written notice of payment owing together with a computation of the amounts due.

 

(b)            Unless
otherwise required by any Final Determination, the Parties agree that any payment made by one Party to the other Party (other than payments
of interest and payment of After Tax Amounts pursuant to Section 6.03(c)) pursuant to this Agreement shall be treated for
all Tax purposes as payments with respect to stock (dividend distributions or capital contributions, as the case may be) made immediately
prior to the Distribution.

 

(c)            If
it is determined that the receipt or accrual of any payment made under this Agreement (other than payments of interest) is subject to
any Tax, the Party making such payment shall be liable for (i) the After Tax Amount with respect to such payment, and (ii) interest
at the Interest Rate on the amount of such Tax from the date such Tax is due through the date of payment of such After Tax Amount. The
Party making a demand for payment pursuant to this Agreement and for a payment of an After Tax Amount with respect to such payment shall
(i) separately specify and compute such After Tax Amount and (ii) make the demand for the After Tax Amount no later than 90
days following the demand for the payment to which such After Tax Amount relates.

 

(d)            Any
payment that is required to be made pursuant to this Agreement (i) by Constellation (or an Affiliate of Constellation) to Exelon
(or an Affiliate of Exelon), or (ii) by Exelon (or an Affiliate of Exelon) to Constellation (or an Affiliate of Constellation), that
is not made on or prior to the date that such payment is required to be made pursuant to this Agreement shall thereafter bear interest
at the Interest Rate.

 

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ARTICLE VII

DISPUTE RESOLUTION

 

7.01          Dispute
Resolution. All disputes, controversies, or claims arising under or in connection with this Agreement
(including any dispute, controversy, or claim relating to the breach, termination, or validity thereof) between or among any of Exelon
or its Affiliates and Constellation or its Affiliates shall be governed by Article X of the Separation Agreement or the procedures
set forth in Section 7.02 as determined by the Parties. If the Parties cannot agree as to which procedure will govern such
dispute, such dispute shall be resolved pursuant to Article X of the Separation Agreement. Each Party agrees that the procedures
set forth in Article X of the Separation Agreement or Section 7.02, as applicable pursuant to this Section 7.01,
shall be the sole and exclusive remedy in connection with any dispute, controversy, or claim relating to any of the foregoing matters.

 

7.02          Procedures.
With respect to any dispute governed by this Section 7.02, the Parties shall mutually
appoint (i) a “big four” accounting firm, (ii) a law firm that is nationally recognized as being expert in Tax matters,
or (iii) any other accounting firm that is nationally recognized as being an expert in Tax matters (the “Advisory Firm”)
to resolve such dispute. In this regard, the Advisory Firm shall make determinations with respect to the disputed items based solely on
representations made by Exelon and Constellation and their respective representatives, and not by independent review, and shall function
only as an expert and not as an arbitrator and shall be required to make a determination in favor of one Party only. The Parties shall
require the Advisory Firm to attempt to resolve all disputes no later than sixty (60) days after the submission of such dispute to
the Advisory Firm, but in no event later than the due date for the payment of Taxes or the filing of the applicable Tax Return, if applicable,
and agree that all decisions by the Advisory Firm with respect thereto shall, absent fraud or manifest error, be final and conclusive
and binding on the Parties. The Advisory Firm shall resolve all disputes in a manner consistent with this Agreement and, to the extent
not inconsistent with this Agreement, in a manner consistent with the past practices of Exelon and its Affiliates, except as otherwise
required by applicable Law. The Parties shall require the Advisory Firm to render all determinations in writing to each of the Parties
and to set forth, in reasonable detail, the basis for such determination. The fees and expenses of the Advisory Firm shall be paid by
the non-prevailing Party. In any action to enforce the final determination of the Advisory Firm, each of the Parties irrevocably and unconditionally
(i) consents and submits to the jurisdiction and venue of the courts of the State of Delaware and the federal courts of the United
States of America located within the State of Delaware (the “Delaware Courts”); (ii) waives, to the fullest
extent it may effectively do so, any objection, including any objection to the laying of venue or based on the grounds of forum non conveniens
or any right of objection to jurisdiction on account of its place of incorporation or domicile, which it may now or hereafter have to
the bringing of any such action or proceeding in any Delaware Court; (iii) consents to service of process in the manner provided
by Section 8.05 (other than delivery by e-mail) or in any other manner permitted by law; and (iv) WAIVES ANY RIGHT TO
TRIAL BY JURY.

 

7.03          Arbitration.
In order to facilitate the comprehensive resolution of related disputes, all claims between any
of the parties to a Dispute that arises under or in connection with both this Agreement, on the one hand, and the Separation Agreement
and/or the other Ancillary Agreements, on the other hand, may be brought in a single arbitration in accordance with this Section 7.03.
Upon the written request of any party to an arbitration proceeding constituted under both this Agreement, on the one hand, and the Separation
Agreement and/or the other Ancillary Agreements, on the other hand, the arbitral tribunal shall consolidate such arbitration proceeding
with any other arbitration proceeding relating to this Agreement, on the one hand and the Separation Agreement and/or the other Ancillary
Agreements, on the other hand, if the arbitral tribunal determines that (i) there are issues of fact or Law common to the proceedings
so that a consolidated proceeding would be more efficient than separate proceedings, and (ii) no party to the Dispute would be unduly
prejudiced as a result of such consolidation through undue delay or otherwise. In the event of different rulings on this question by the
arbitral tribunal constituted hereunder and another arbitral tribunal constituted under this Agreement, on the one hand, and the Separation
Agreement and/or the other Ancillary Agreements, on the other hand, the ruling of the arbitral tribunal constituted first in time shall
control, and such arbitral tribunal shall serve as the tribunal for any consolidated arbitration.

 

    25

     

    

 

7.04          Dispute.
In the event of a Dispute, each party to the Dispute shall continue to perform its obligations
under the Separation Agreement, this Agreement, and the other Ancillary Agreements in good faith during the resolution of such Dispute
as if such Dispute had not arisen, unless and until the Separation Agreement, this Agreement, or the other Ancillary Agreements, as applicable,
are terminated in accordance with their respective provisions.

 

ARTICLE VIII

MISCELLANEOUS

 

8.01          Incorporation
by Reference. The following sections of the Separation Agreement are hereby incorporated in this
Agreement by reference to the extent not inconsistent with any of the provisions set forth in this Agreement: Section 8.7 (Confidentiality);
Section 8.8 (Privileged Matters); Section 12.3 (Amendments and Waivers); Section 12.4 (Entire Agreement); Section 12.5
(Survival of Agreements); Section 12.9 (Counterparts; Electronic Delivery); Section 12.10 (Severability); Section 12.11
(Assignability; Binding Effect); Section 12.12 (Governing Law); Section 12.13 (Construction); Section 12.14 (Performance);
Section 12.15 (Title and Headings); and Section 12.16 (Schedules and Exhibits).

 

8.02          Third
Party Beneficiaries. This Agreement shall be binding upon and inure solely to the benefit of
Exelon, Constellation, and their respective Affiliates, and nothing herein, express or implied, is intended to or shall confer upon any
third parties any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

 

8.03          Effectiveness.
This Agreement shall become effective on the Distribution Date.

 

8.04          Changes
in Law. Any reference to a provision of the Code, Treasury Regulations, or a Law of another jurisdiction
shall include a reference to any applicable successor provision or Law. If, due to any change in applicable Law or regulations or their
interpretation by any court of Law or other governing body having jurisdiction subsequent to the date specified in the preamble to this
Agreement, performance of any provision of this Agreement or any transaction contemplated hereby shall become impracticable or impossible,
the Parties shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially
the same result as that contemplated by such provision.

 

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8.05          Notices.
All notices, requests, permissions, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly
given (a) five (5) Business Days following sending by registered or certified mail, postage prepaid, (b) when sent, if
sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient,
and on the next Business Day if sent after normal business hours of the recipient, (c) when delivered, if delivered personally to
the intended recipient, and (d) one (1) Business Day following sending by overnight delivery via a national courier service
and, in each case, addressed to a Party at the following address for such Party (as updated from time to time by notice in writing to
the other Party):

 

(a)            If
to Exelon, at:

 

Exelon Corporation

10 S. Dearborn St. 

Chicago, IL 60603

Attention: General Counsel

Email: gayle.littleton@exeloncorp.com

 

(b)            If
to Constellation, at:

 

Constellation Energy Corporation 

1310 Point Street 

Baltimore, MD 21231 

Attention: General Counsel 

Email: david.dardis@constellation.com

 

8.06          Joint
and Several Liability. Constellation and each Affiliate of Constellation shall have joint and
several liability for any obligation of Constellation or an Affiliate of Constellation arising pursuant to this Agreement. Exelon and
each Affiliate of Exelon (other than any such Affiliate that is a utility or direct or indirect subsidiary thereof) shall have joint and
several liability for any obligation of Exelon or an Affiliate of Exelon arising pursuant to this Agreement.

 

8.07          Tax
Sharing Agreements. All Tax sharing, indemnification and similar agreements, written or unwritten,
as between any member of the Constellation Group, on the one hand, and any member of the Exelon Group, on the other hand (other than the
Separation Agreement, this Agreement, or any other Ancillary Agreement), shall be or shall have been terminated as of the Effective Time
and, after the Effective Time, none of such Parties (or their respective Subsidiaries) to any such Tax sharing, indemnification or similar
agreement shall have any further rights or obligations under any such agreement.

 

8.08          Expenses.
Unless otherwise expressly provided in this Agreement, each Party shall bear any and all expenses that arise from their respective obligations
under this Agreement.

 

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8.09          Limitation
on Damages. Each Party irrevocably waives, and no Party shall be entitled to seek or receive,
consequential, special, indirect or incidental damages (including without limitation damages for loss of profits) or punitive damages,
regardless of how such damages were caused and regardless of the theory of liability; provided that the foregoing shall not limit each
Party’s indemnification obligations set forth in the Separation Agreement, this Agreement and the Ancillary Agreements.

 

8.10          Consent
by Affiliates. Constellation shall cause each of its respective Affiliates (including any entity
that becomes an Affiliate after the date hereof) to consent to, and be bound by, the terms, conditions, covenants, and provisions of this
Agreement.

 

8.11          Coordination
with Other Agreements. The Parties agree that this Agreement shall take precedence over any and
all agreements among the Parties with respect to Tax matters that are in effect as of the date hereof, including indemnification in respect
of Tax matters; provided, however, this Agreement shall not take precedence over any Tax matter relating to the payment
or reimbursement of Taxes that exists now or in the future under any lease of property or power purchase agreement between Exelon and
Constellation, or any of their respective Affiliates, as the case may be, and any such Taxes shall be governed exclusively by such leases
or power purchase agreements without regard to this Agreement.

 

[Signature Page Follows]

 

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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date
first written

 

	 	EXELON CORPORATION
	 	 
	 	 
	 	By:	/s/ Christopher Crane
	 	 	Name: 	Christopher Crane
	 	 	Title: 	President and Chief Executive Officer
	 	 
	 	Constellation Energy Corporation
	 	 
	 	 
	 	By:	/s/ Joseph Dominguez
	 	 	Name: 	Joseph Dominguez
	 	 	Title:	 President and Chief Executive Officer

 

[Tax Matters Agreement]

 

    	 		 

     

    

  

Schedules to Tax Matters Agreement

 

Schedule
A: Tax Sharing Agreement of Tax Credit CarryforwardsExhibit 10.3

 

EMPLOYEE MATTERS AGREEMENT

 

THIS EMPLOYEE MATTERS AGREEMENT (this “Agreement”)
is dated January 31, 2022, by and between EXELON CORPORATION, a Pennsylvania corporation (“Exelon”), and
Constellation Energy Corporation, a Pennsylvania corporation and a direct, wholly-owned subsidiary of Exelon (“Constellation”).
Exelon and Constellation are sometimes referred to herein individually as a “Party,” and collectively as the
 “Parties.” Capitalized terms used but not otherwise defined herein shall have the respective meanings set forth
in Section 1.1.

 

RECITALS

 

WHEREAS, Exelon and Constellation have entered
into a Separation Agreement, dated as of the date hereof (the “Separation Agreement”), pursuant to which Exelon
will distribute on a pro rata basis to the holders of shares of Exelon common stock, without par value (“Exelon Shares”),
without any consideration being paid by the holders of such Exelon Shares, all of the outstanding shares of Constellation common stock,
without par value (“Constellation Shares”), owned by Exelon as of the Distribution Date (as defined in the Separation
Agreement); and

 

WHEREAS, in connection with the Distribution (as
defined in the Separation Agreement), Exelon and Constellation desire to enter into this Employee Matters Agreement.

 

NOW, THEREFORE, in consideration of the foregoing
and the covenants and agreements set forth below and other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound hereby, the Parties hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

1.1           Definitions.
Unless otherwise defined herein, each capitalized term shall have the meaning specified for such term in the Separation Agreement. As
used in this Agreement:

 

“Adjusted
Exelon Stock Award” has the meaning set forth in Section 6.2(b).

 

“Adjusted Exelon Stock Option Award”
has the meaning set forth in Section 6.4(b).

 

“Agreement” means this
Employee Matters Agreement together with those parts of the Separation Agreement referenced herein and all schedules hereto and all amendments,
modifications and changes hereto and thereto.

 

“BSC” means Exelon Business
Services Company, LLC.

 

“Code” means the Internal
Revenue Code of 1986.

 

“ComEd” means Commonwealth
Edison Company.

 

     

     

    

 

“ComEd/BSC-Local 15 Agreement”
means the Agreement (including the collective bargaining agreements referenced therein) entered into prior to the Distribution Date
among ComEd and BSC, including any transferees from and/or successors to ComEd and/or BSC and Local 15 of the International Brotherhood
of Electrical Workers (“Local 15”) on behalf of its members that addresses the impact of the Distribution on
the collective bargaining agreement among ComEd/BSC and Local 15 and on the Exelon Employees represented by Local 15.

 

“Constellation” has the
meaning set forth in the first paragraph of this Agreement.

 

“Constellation Board”
means the Board of Directors of Constellation (or, as the context requires, the Compensation Committee or Corporate Governance Committee
thereof).

 

“Constellation Business”
means a business involving the competitive power generation and marketing and trading of electricity and gas, principally through Exelon
Generation Company, LLC and its Subsidiaries. For the sake of clarity, Constellation Business also includes any other business conducted
by any member of the Constellation Group as of or prior to the date of this Agreement.

 

“Constellation Conversion Ratio”
has the meaning set forth in Section 6.2(a).

 

“Constellation Director”
means a person who serves as a nonemployee director of Constellation immediately after the Distribution Date.

 

“Constellation Director Deferred Compensation
Plans” has the meaning set forth in Section 3.3(c).

 

“Constellation Executive Deferred Compensation
Plans” has the meaning set forth in Section 3.3(a).

 

“Constellation Employee”
means (i) each person who immediately prior to the Distribution Date is employed by a member of the Constellation Group, (ii) each
former employee of Exelon or any of its Affiliates whose last employment prior to termination was with a member of the Constellation Group
and (iii) each former employee of Exelon or any of its Affiliates whose last employment prior to termination was with a member of
the Exelon Group but (A) whose job duties immediately prior to termination related primarily to the Constellation Business, (B) who
immediately prior to termination was employed at a location that primarily served the Constellation Business or (C) who was a Shared
Services Employee whose employment terminated on or after January 1, 2001 and who immediately prior to termination was not employed
at a location that primarily served either the Exelon Business or the Constellation Business; provided that no person who is listed as
an Exelon Employee in Schedule A hereto shall be considered a Constellation Employee. Prior to the Distribution Date, Exelon shall
determine, in its sole discretion, which current and former employees are Constellation Employees, based on their title and location of
employment and such other criteria that Exelon determines are controlling.

 

“Constellation ESP” has
the meaning set forth in Section 3.1(a).

 

“Constellation ESP Trust”
means the trust maintained under the Constellation ESP.

 

    2

     

    

 

“Constellation ESPP”
has the meaning set forth in Section 6.6(a).

 

“Constellation Fringe Benefit Plans”
has the meaning set forth in Section 5.5.

 

“Constellation FSA” has
the meaning set forth in Section 4.5.

 

“Constellation Group”
means (a) Constellation, (b) the Constellation Entities and (c) each Person that becomes a subsidiary of Constellation
after the Distribution, including in each case any Person that is merged or consolidated with or into, or the result of a statutory division
of, Constellation or any Subsidiary of Constellation.

 

“Constellation Pension Plans”
has the meaning set forth in Section 3.2(a).

 

“Constellation Pension Trust”
has the meaning set forth in Section 3.2(c).

 

“Constellation Post-Distribution Stock
Price” means the per share price of Constellation Shares, determined on a post-Distribution basis, which shall be equal
to the average of the volume weighted average price of Constellation Shares for each of the five consecutive trading days beginning with
the day immediately following the Distribution Date.

 

“Constellation Rabbi Trusts”
has the meaning set forth in Section 3.3(a).

 

“Constellation Retiree Welfare Plans”
has the meaning set forth in Section 4.6(a).

 

“Constellation Shares”
has the meaning set forth in the recitals of this Agreement.

 

“Constellation Stock Plans”
has the meaning set forth in Section 6.1.

 

“Constellation Welfare Plan”
has the meaning set forth in Section 4.1.

 

“Compensation Committee”
means the Compensation and Leadership Development Committee of the Exelon Board or the Compensation and Leadership Development Committee
of the Constellation Board, as the case may be (or any successor committee thereto).

 

“Corporate
Governance Committee” means the Corporate Governance Committee of the Exelon Board or the Corporate Governance Committee
of the Constellation Board, as the case may be (or any successor committee thereto).

 

“Deceased Constellation Employee”
means a Constellation Employee who died prior to the Distribution Date.

 

“Deceased Exelon Employee”
means an Exelon Employee who died prior to the Distribution Date.

 

    3

     

    

 

“Designated
Pension Plans” means (i) the Exelon Employee Pension Plan for Clinton, TMI and Oyster Creek (consisting of Exelon
Pension Plan for Represented Employees at TMI and OYC, Exelon Pension Plan for Non-Represented Employees at TMI and OYC, Exelon Pension
Plan for Represented Employees at Clinton, Exelon Pension Plan for Non-Represented Employees at Clinton, Exelon Cash Balance Pension Plan
for Employees at TMI, OYC and Clinton, Exelon Corporation Cash Balance Plan for Non-Bargaining Employees at J.A.F., Exelon Corporation
Retirement Plan II for Non-Bargaining Employees at J.A.F., Exelon Corporation Retirement Plan II for Bargaining Employees at J.A.F., and
Exelon Corporation Retirement Plan III for Employees at J.A.F.), (ii) the Exelon New England Union Employees Pension Plan, (iii) the
Pension Plan of Constellation Energy Nuclear Group, LLC, (iv) the Nine Mile Point Pension Plan, and (v) the Constellation Mystic
Power, LLC Union Employees Pension Plan including Plan A and Plan B.

 

“Designated
401(k) Plans” means (i) the Exelon Employee Savings Plan for Represented Employees at TMI and Oyster Creek
and (ii) the Exelon Employee Savings Plan for Represented Employees at Clinton.

 

“ERISA” means the Employee
Retirement Income Security Act of 1974.

 

“Exelon” has the meaning
set forth in the first paragraph of this Agreement.

 

“Exelon Business” means
a business involving the regulated transmission and distribution of electricity and natural gas, principally through Exelon Energy Delivery
Company, LLC and its Subsidiaries. For the sake of clarity, the Exelon Business does not include the Constellation Business.

 

“Exelon Conversion Ratio”
has the meaning set forth in Section 6.2(b).

 

“Exelon DB Master Trust”
has the meaning set forth in Section 3.2(c).

 

“Exelon
Director Deferred Compensation Plans” means (i) the Exelon Corporation Non-Employee Directors’ Deferred
Stock Unit Plan, (ii) the Exelon Corporation Unfunded Deferred Compensation Plan for Directors, (iii) the Constellation Energy
Group Deferred Compensation Plan for Non-Employee Directors, (iv) the Atlantic City Electric Director Retirement Plan, and any other
nonqualified deferred compensation plan maintained by a member of the Exelon Group or the Constellation Group for the benefit of nonemployee
directors.

 

“Exelon
Executive Deferred Compensation Plans” means (i) the Exelon Corporation Deferred Compensation Plan, (ii) the
Exelon Corporation Supplemental Management Retirement Plan, (iii) the Exelon Corporation Stock Deferral Plan, (iv) the Exelon
Corporation Supplemental Pension Benefit Plan, (v) the PECO Energy Company Supplemental Pension Benefit Plan, (vi) the Unicom
Corporation Deferred Compensation Unit Plan, (vii) the Constellation Energy Group Nonqualified Deferred Compensation Plan, (viii) the
Constellation Energy Group Benefits Restoration Plan, (ix) the Constellation Energy Group Supplemental Pension Plan, (x) the
Constellation Energy Nuclear Plan, LLC Executive Retirement Plan, (xi) the Constellation Energy Nuclear Plan, LLC Benefits Restoration
Plan, (xii) the Pepco Holdings LLC 2011 Supplemental Executive Retirement Plan, (xiii) the Conectiv Supplemental Executive Retirement
Plan, (xiv) the Pepco Holdings LLC Combined Executive Retirement Plan, (xv) the PEPCO Deferred Compensation Plan, (xvi) the
Commonwealth Edison Company Deferred Compensation Plan and any other nonqualified deferred compensation plan maintained by a member of
the Exelon Group or the Constellation Group for current or former employees.

 

    4

     

    

 

“Exelon DSU Award” means
a deferred stock unit award granted under any of the Exelon Stock Plans that is outstanding as of the Distribution Date.

 

“Exelon Employee” means
(i) each person who immediately prior to the Distribution Date is employed by a member of the Exelon Group, (ii) each former
employee of Exelon or any of its Affiliates (A) whose job duties immediately prior to termination related primarily to the Exelon
Business, (B) who immediately prior to termination was employed at a location that primarily served the Exelon Business or (C) who
was a Shared Services Employee whose employment terminated prior to January 1, 2001 and who immediately prior to termination was
not employed at a location that primarily served either the Exelon Business or the Constellation Business and (iii) such other former
employees of Exelon or any of its Affiliates who are listed in Schedule A hereto. Prior to the Distribution Date, Exelon shall
determine, in its sole discretion, which current and former employees are Exelon Employees, based on their title and location of employment
and such other criteria that Exelon determines are controlling.

 

“Exelon ESP” means the
Exelon Corporation Employee Savings Plan.

 

“Exelon ESP Trust” means
the trust maintained under the Exelon ESP.

 

“Exelon ESPP” has the
meaning set forth in Section 6.6(a).

 

“Exelon Fringe Benefit Plans”
has the meaning set forth in Section 5.5.

 

“Exelon FSA” has the
meaning set forth in Section 4.5.

 

“Exelon Group” means,
collectively, Exelon and the Subsidiaries and entities held by Exelon other than Constellation and the Constellation Entities.

 

“Exelon Non-ERISA Benefit Arrangement”
means any Non-ERISA Benefit Arrangement sponsored or maintained by Exelon or any of its Subsidiaries.

 

“Exelon
Pension Plans” means (i) the Exelon Corporation Retirement Program (consisting of the Commonwealth Edison Company
Service Annuity System, Service Annuity Plan of PECO Energy Company and Exelon Corporation Cash Balance Pension Plan), (ii) the Exelon
Corporation Pension Plan for Bargaining Unit Employees, (iii) the Pension Plan of Constellation Energy Group, Inc., and (iv) the
Pepco Holdings LLC Retirement Plan (consisting of GRP Sub-Plan, ACE Sub-Plan, PHI Sub-Plan, Delmarva Sub-Plan and Conectiv Cash Balance
Sub-Plan).

 

“Exelon Performance Share Award”
means a performance share award granted under any of the Exelon Stock Plans that is outstanding as of the Distribution Date.

 

“Exelon Plan” means any
Pension Plan or Welfare Plan sponsored or maintained by a member of the Exelon Group.

 

“Exelon Post-Distribution Stock Price”
means the per share price of Exelon Shares, determined on a post-Distribution basis, which shall be equal to the average of the volume
weighted average price of Exelon Shares for each of the five consecutive trading days beginning with the day immediately following the
Distribution Date.

 

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“Exelon Pre-Distribution Stock Price”
means the per share price of Exelon Shares, determined on a pre-Distribution basis, which shall be equal to the average of the volume
weighted average price of Exelon Shares, traded regular way, for each of the five consecutive trading days immediately preceding and including
the Distribution Date.

 

“Exelon Rabbi Trusts”
has the meaning set forth in Section 3.3(a).

 

“Exelon Retiree Welfare Plans”
means Exelon Welfare Plans that cover retired employees.

 

“Exelon RSU Award” means
a restricted stock unit award granted under any of the Exelon Stock Plans that is outstanding as of the Distribution Date.

 

“Exelon Shares” has the
meaning set forth in the recitals of this Agreement.

 

“Exelon Stock Award”
has the meaning set forth in Section 6.2(a).

 

“Exelon Stock Option Award”
means a stock option award granted under any of the Exelon Stock Plans that is outstanding as of the Distribution Date.

 

“Exelon Stock Plans”
mean the Exelon Corporation 2006 Long-Term Incentive Plan, the Exelon Corporation 2011 Long-Term Incentive Plan, the Exelon Corporation
2020 Long-Term Incentive Plan, the Constellation Energy Group, Inc. Amended and Restated 2007 Long-Term Incentive Plan and any other
equity or equity-based incentive plan under which awards have been granted to current or former employees or nonemployee directors of
the Exelon Group or the Constellation Group.

 

“Exelon Welfare Plan”
means a Welfare Plan sponsored or maintained by any member of the Exelon Group.

 

“ExGen” means Exelon
Generation Company, LLC.

 

“ExGen-Local 15 Agreement”
means the Agreement (including the collective bargaining agreements referenced therein) entered into prior to the Distribution Date between
ExGen, including any transferees from and/or successors to ExGen, and Local 15, that addresses the impact of the Distribution on the collective
bargaining agreement between ExGen and Local 15 and on the Constellation Employees represented by Local 15.

 

“Final Transfer Amount”
has the meaning set forth in Section 3.2(c).

 

“Final Transfer Date”
has the meaning set forth in Section 3.2(c).

 

“Former Shared Services Employee”
means a Shared Services Employee whose employment with the Exelon Group or the Constellation Group terminated prior to the Distribution
Date.

 

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“Initial Transfer Amount”
has the meaning set forth in Section 3.2(c).

 

“IRS” means the Internal
Revenue Service.

 

“Non-ERISA Benefit Arrangement”
means any contract, agreement, policy, practice, program, plan, trust or arrangement, other than a Pension Plan or Welfare Plan, providing
for benefits, perquisites or compensation of any nature, including but not limited to transportation, tuition reimbursement, adoption
assistance, vacation, holidays, sick, personal or bereavement days, relocation benefits, supplemental unemployment, bonus or other forms
of incentive compensation.

 

“Pension Plan” means
any pension plan as defined in Section 3(2) of ERISA, without regard to Section 4(b)(4) or 4(b)(5) of ERISA.

 

“Separation Agreement”
has the meaning set forth in the recitals of this Agreement.

 

“Shared Services Employee”
means a current or former employee of the Exelon Group or Constellation Group whose job duties are not or were not, immediately prior
to termination of employment, related primarily to either the Exelon Business or the Constellation Business.

 

“Substitute Constellation Stock Option
Award” has the meaning set forth in Section 6.4(a)

 

“Substitute Constellation RSU Award”
has the meaning set forth in Section 6.2(a).

 

“Surviving Dependent”
means each individual who immediately prior to the Distribution Date was enrolled in the Exelon Corporation Health Care Program as a surviving
dependent of a Deceased Constellation Employee.

 

“Transactions” means,
collectively, the transactions and other actions contemplated by this Agreement.

 

“VEBA” means a tax-exempt
entity established pursuant to Section 501(c)(9) of the Code.

 

“Welfare Plan” means
any employee welfare plan as defined in Section 3(1) of ERISA, without regard to Section 4(b)(4) or 4(b) (5) of
ERISA.

 

1.2           Interpretation.
In this Agreement, unless the context clearly indicates otherwise:

 

(a)            words
used in the singular include the plural and words used in the plural include the singular;

 

(b)            the
words “include,” “includes” and “including” shall be deemed to be followed by the words “without
limitation”;

 

(c)            the
word “or” shall have the inclusive meaning represented by the phrase “and/or”;

 

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(d)            relative
to the determination of any period of time, “from” means “from and including,” “to” means “to
but excluding” and “through” means “through and including”;

 

(e)            accounting
terms used herein shall have the meanings historically ascribed to them by Exelon and its Subsidiaries in their internal accounting and
financial policies and procedures in effect immediately prior to the date of this Agreement;

 

(f)             reference
to any agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified
from time to time to the extent permitted by the provisions thereof and by this Agreement;

 

(g)            reference
to any Law means such Law (including any and all rules and regulations promulgated thereunder) as amended, modified, codified or
reenacted, in whole or in part, and in effect at the time of determining compliance or applicability;

 

(h)            references
to any Person include such Person’s successors and assigns but, if applicable, only if such successors and assigns are permitted
by this Agreement; a reference to such Person’s “Affiliates” shall be deemed to mean such Person’s Affiliates
following the Distribution and any reference to a third party shall be deemed to mean a Person who is not a Party or an Affiliate of a
Party;

 

(i)             if
there is any conflict between the provisions of the main body of this Agreement and any exhibits or schedules hereto, the provisions of
the main body of this Agreement shall control unless explicitly stated otherwise in such exhibit or schedule; and

 

(j)             any
portion of this Agreement obligating a Party to take any action or refrain from taking any action, as the case may be, shall mean that
such Party shall also be obligated to cause its relevant Subsidiaries to take such action or refrain from taking such action, as the case
may be.

 

ARTICLE II

 

ASSIGNMENT OF EMPLOYEES

 

As of the date immediately prior to the Distribution
Date, (i) the employment of each current employee of the Exelon Group who is intended to be a Constellation Employee shall have been
assigned and transferred to the Constellation Group and (ii) the employment of each current employee of the Constellation Group who
is intended to be an Exelon Employee shall have been assigned and transferred to the Exelon Group. If it is determined after the Distribution
Date that any employees were not properly assigned and transferred to the appropriate employer prior to the Distribution Date or that
it is necessary or appropriate to assign and transfer an employee performing services pursuant to the Transition Services Agreement to
the other group, the Parties shall cooperate in good faith to effect such assignment and transfer after the Distribution Date. Notwithstanding
anything to the contrary contained herein, nothing in this Agreement shall create any obligation on the part of the Exelon Group or the
Constellation Group to continue the employment of any employee for any definite period following the Distribution Date or to change the
employment status of any employee from “at will.”

 

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ARTICLE III

 

PENSION, RETIREMENT AND DEFERRED COMPENSATION
PLANS

 

3.1            Defined
Contribution Plans.

 

(a)            Establishment
of the Constellation Employee Savings Plan. Effective on or before the Distribution Date, Constellation shall adopt, establish and
maintain a 401(k) profit sharing plan and trust for the benefit of employees of the Constellation Group that has substantially the
same terms and conditions as the Exelon ESP and is intended to be qualified under Section 401(a) of the Code and exempt from
federal income tax under Section 501(a) of the Code (the “Constellation ESP”). As soon as practicable
after the adoption of the Constellation ESP, Constellation shall submit an application to the IRS for a determination that the Constellation
ESP is qualified under Section 401(a) of the Code and that the related Constellation ESP Trust is exempt from federal income
tax under Section 501(a) of the Code, and shall take any actions not inconsistent with Constellation’s other general commitments
contained in this Agreement and make any amendments necessary to receive such determination.

 

(b)            Transfer
of Assets from Exelon Corporation Employee Savings Plan. On or as soon as administratively practicable after the Distribution Date,
Exelon and Constellation shall cause the Exelon ESP Trust to transfer to the Constellation ESP Trust assets having a value as of the applicable
valuation date that is equal to the value of the account balances of, and accrued liabilities (including any outstanding loan balances)
with respect to, all Constellation Employees and all survivors and beneficiaries of all Deceased Constellation Employees with an account
balance under the Exelon ESP as of such valuation date. “Accrued liabilities” for these purposes shall include employer matching
contributions (including fixed matching contributions and nondiscretionary employer profit sharing contributions) and nondiscretionary
fixed employer contributions deposited to the Exelon ESP Trust on a per payroll or annual basis, as applicable, for any Constellation
Employee that was accrued prior to the transfer of assets from the Exelon ESP Trust to the Constellation ESP Trust. In addition, on or
as soon as administratively practicable after the Distribution Date, a pro rata share of all unallocated amounts (including but not limited
to any forfeiture accounts, revenue sharing credit accounts, as applicable, or other unallocated accounts held under the Exelon ESP immediately
prior to the Distribution Date) shall be transferred from the Exelon ESP Trust to the Constellation ESP Trust, determined based upon the
ratio of the number of all Constellation Employees actively participating in the Exelon ESP immediately prior to the Distribution Date
to the number of all employees actively participating in the Exelon ESP immediately prior to the Distribution Date. Assets transferred
pursuant to this paragraph shall be in cash or in kind, including shares of securities, promissory notes evidencing outstanding plan loans,
Exelon Shares or Constellation Shares, and such transfer shall be made in accordance with Section 414(l) of the Code. Liabilities
under any qualified domestic relations orders (as defined in Section 414(p) of the Code) received with respect to any accounts
transferred to the Constellation ESP shall be transferred to and assumed by the Constellation ESP at the time such assets attributable
to such accounts are transferred. Constellation shall continue to process any plan loans transferred from the Exelon ESP to the Constellation
ESP. All beneficiary designations made by Constellation Employees and by survivors and beneficiaries of Deceased Constellation Employees
under the Exelon ESP shall, to the extent applicable, be transferred to, and be in full force and effect under, the Constellation ESP
until such beneficiary designations are subsequently replaced or revoked by the Constellation Employee (or the survivor or beneficiary
of the Deceased Constellation Employee) who made the beneficiary designation (or his or her legally recognized agent). On and after the
Distribution Date, Constellation shall, or shall cause a member of the Constellation Group to, assume and thereafter be solely responsible
for all then existing and future employer liabilities related to such Constellation Employees and survivors and beneficiaries of Deceased
Constellation Employees under the Constellation ESP and the administration thereof and the Exelon Group shall have no liability whatsoever
therefor.

 

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(c)            Transfer
of Designated 401(k) Plans. Exelon shall take all actions as may be necessary or appropriate to transfer the Designated 401(k) Plans
in whole to Constellation as of the Distribution Date, including any related trusts and all assets and liabilities relating thereto, and
Constellation shall accept such transfer. Any Constellation Employees and any survivors or beneficiaries of any Deceased Constellation
Employees who were participating in the Designated 401(k) Plans as of immediately prior to the Distribution Date shall continue to
participate in the Designated 401(k) Plans following the Distribution Date, in accordance with the applicable plan terms. On and
after the Distribution Date, Constellation shall, or shall cause a member of the Constellation Group to, assume and thereafter be solely
responsible for all then existing and future employer liabilities related to such Constellation Employees and survivors and beneficiaries
of Deceased Constellation Employees under the Designated 401(k) Plans and the administration thereof, and the Exelon Group shall
have no liability whatsoever therefor.

 

(d)            Liquidation
of Non-Employer Stock Held in Exelon ESP and Constellation ESP. Subject to the exercise of its fiduciary duties or other requirements
of ERISA and any other applicable Laws, as soon as administratively practicable after the Distribution Date, Exelon shall cause the Exelon
ESP to liquidate any Constellation Shares held in the Exelon ESP. Subject to the exercise of its fiduciary duties or other requirements
of ERISA and any other applicable Laws, as soon as administratively practicable after the Distribution Date, Constellation shall cause
the Constellation ESP to liquidate any Exelon Shares held in the Constellation ESP.

 

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3.2            Defined
Benefit Pension Plans.

 

(a)            Establishment
of Constellation Pension Plans. Effective on or before the Distribution Date, Constellation shall adopt, establish and maintain one
or more Pension Plans and a trust for the benefit of Constellation Employees (the “Constellation Pension Plans”).
Whether in a unified plan document or multiple plan documents that make up a single Pension Plan, or separate plan documents for separate
Pension Plans, the Constellation Pension Plans will have substantially the same terms and conditions as each applicable Exelon Pension
Plan in which Constellation Employees participate prior to the Distribution Date. The Constellation Pension Plans are intended to be qualified
under Section 401(a) of the Code and exempt from federal income tax under Section 501(a) of the Code. As soon as practicable
after the adoption of the Constellation Pension Plans and trust, Constellation shall submit an application to the IRS for a determination
that the Constellation Pension Plans are qualified under Section 401(a) of the Code and that the related trust is exempt from
federal income tax under Section 501(a) of the Code, and shall take any actions not inconsistent with Constellation’s
other general commitments contained in this Agreement and make any amendments necessary to receive such determination. As of the Distribution
Date, the Constellation Pension Plans shall assume all liabilities with respect to all Constellation Employees under the applicable Exelon
Pension Plans (and any survivor or beneficiary of a Deceased Constellation Employee who is entitled to a benefit under the applicable
Exelon Pension Plans immediately prior to the Distribution Date) and neither Exelon nor any of its Affiliates shall assume or retain any
such liabilities. All beneficiary designations made by Constellation Employees and by survivors and beneficiaries of Deceased Constellation
Employees under the Exelon Pension Plans shall, to the extent applicable, be transferred to, and be in full force and effect under, the
Constellation Pension Plans until such beneficiary designations are replaced or revoked by the Constellation Employee (or the survivor
or beneficiary of the Deceased Constellation Employee) who made the beneficiary designation (or his legally recognized agent). Further,
liabilities under any qualified domestic relations orders (as defined in Section 414(p) of the Code) received with regard to
any benefits for such Constellation Employees shall be transferred to and assumed by the Constellation Pension Plans as of the Distribution
Date.

 

(b)            Transfer
of Designated Pension Plans. Exelon shall take all actions as may be necessary or appropriate to transfer the Designated Pension Plans
in whole to Constellation as of the Distribution Date. Any Constellation Employees and any survivors or beneficiaries of any Deceased
Constellation Employees who were participating in the Designated Pension Plans as of immediately prior to the Distribution Date shall
continue to participate in the Designated Pension Plans following the Distribution Date, in accordance with the applicable plan terms.
On and after the Distribution Date, Constellation shall, or shall cause a member of the Constellation Group to, assume and thereafter
be solely responsible for all then existing and future employer liabilities related to such Constellation Employees and survivors and
beneficiaries of Deceased Constellation Employees under the Designated Pension Plans and the administration thereof, and the Exelon Group
shall have no liability whatsoever therefor. As of the Distribution Date, one or more of the Exelon Pension Plans shall assume all liabilities
with respect to all Exelon Employees who have accrued a benefit under the Designated Pension Plans (and any survivor or beneficiary of
a Deceased Exelon Employee who is entitled to a benefit under the Designated Pension Plans immediately prior to the Distribution Date)
and neither Constellation nor any of its Affiliates shall assume or retain any such liabilities. All beneficiary designations made by
Exelon Employees and by survivors and beneficiaries of Deceased Exelon Employees under the Designated Pension Plans shall, to the extent
applicable, be transferred to, and be in full force and effect under, the applicable Exelon Pension Plan until such beneficiary designations
are replaced or revoked by the Exelon Employee (or the survivor or beneficiary of the Deceased Exelon Employee) who made the beneficiary
designation (or his legally recognized agent). Further, liabilities under any qualified domestic relations orders (as defined in Section 414(p) of
the Code) received with regard to any benefits for such Exelon Employees shall be transferred to and assumed by the applicable Exelon
Pension Plan as of the Distribution Date.

 

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(c)            Transfer
of Assets. Within 30 days after the Distribution Date, Exelon shall cause to be transferred from the Exelon Corporation Pension Master
Retirement Trust (the “Exelon DB Master Trust”) to the trust established for the Constellation Pension Plans
and the Designated Pension Plans (the “Constellation Pension Trust”) an initial amount of assets (the “Initial
Transfer Amount”) in cash and cash equivalents held in the Exelon DB Master Trust, which amount shall be equal to a portion
of the amount the actuary engaged by the Exelon Pension Plans and Designated Pension Plans determines in good faith to be a reasonable
estimate of the aggregate amount of assets to be transferred as of the Distribution Date for all Constellation Employees (and all survivors
and beneficiaries of Deceased Constellation Employees) with accrued benefits under the applicable Exelon Pension Plans or Designated Pension
Plans in accordance with Section 414(l) of the Code and Section 4044 of ERISA. As soon as administratively practicable
after the Distribution Date, the actuary engaged by the applicable Exelon Pension Plans and Designated Pension Plans shall determine the
final amount of assets to be transferred as of the Distribution Date for all Constellation Employees (and all survivors and beneficiaries
of Deceased Constellation Employees) with accrued benefits under the Exelon Pension Plans and Designated Pension Plans in accordance with
Section 414(l) of the Code and Section 4044 of ERISA (the “Final Transfer Amount”). Over the
time period determined by the Exelon Group, in consultation with the Constellation Group, after the date the Final Transfer Amount is
determined, and in accordance with the procedures agreed upon by the Exelon Group and the Constellation Group, the Exelon Group shall
direct the trustee of the Exelon DB Master Trust to transfer to the trustee of the Constellation Pension Trust assets in an amount equal
to the Final Transfer Amount, reduced (i) by the Initial Transfer Amount, (ii) as necessary to reflect benefit payments made
from the Exelon DB Master Trust on behalf of any Constellation Employees (or any survivors or beneficiaries of Deceased Constellation
Employees) under the applicable Exelon Pension Plans and Designated Pension Plans, which payments are effective as of the Distribution
Date or any other date between the Distribution Date and the Final Transfer Date, (iii) by any administrative expenses paid from
the Exelon DB Master Trust prior to the Final Transfer Date in preparation for the administration of the Constellation Pension Plans and
Designated Pension Plans and the transfer of the Final Transfer Amount to the Constellation Pension Trusts, (iv) the amount of assets
to be retained by the Exelon DB Master Trust as of the Distribution Date for all Exelon Employees (and all survivors and beneficiaries
of Deceased Exelon Employees) with accrued benefits under the Designated Pension Plan in accordance with Section 414(l) of the
Code and Section 4044 of ERISA, as determined by the actuary engaged by the Designated Pension Plans and (v) by the pro-rata
portion of monthly investment expenses incurred by the Exelon Pension Plans and Designated Pension Plans attributable to the Final Transfer
Amount for the period beginning on the Distribution Date and ending on the Final Transfer Date. From the actual date of delivery of the
Initial Transfer Amount on the Distribution Date until the actual date of delivery of the Final Transfer Amount (the “Final
Transfer Date”), the trustee of the Exelon DB Master Trust shall hold the Final Transfer Amount under the Exelon Pension
Plans and Designated Pension Plans and the Final Transfer Amount shall be credited with earnings, from the Distribution Date to the Final
Transfer Date, at a rate of return appropriate for the Constellation Pension Plans’ investments in the Exelon DB Master Trust for
the period beginning on the Distribution Date and ending on the Final Transfer Date, as determined by agreement between (i) the Exelon
Group through its authorized representative acting as, or on behalf of, the named fiduciary of the Exelon Pension Plans (the “Exelon
Named Fiduciary”) and (ii) the Constellation Group through its authorized representative acting as, or on behalf of, the named
fiduciary of the Constellation Pension Plans and Designated Pension Plans (the “Constellation Named Fiduciary”). In addition,
the Constellation Named Fiduciary shall direct the Exelon Group with respect to investments and liquidations of assets held by the Exelon
DB Master Trust that are allocated in the Exelon DB Master Trust’s records for the benefit of the Constellation Pension Trust during
the period beginning on the Distribution Date and ending on the Final Transfer Date, and the Exelon Group and the Exelon Named Fiduciary
shall have no such responsibility. To the extent the parties discover, within eighteen months after the date on which the final transfer
of assets is made from the Exelon DB Master Trust to the Constellation Pension Trust, that an incorrect amount (either too much or too
little) of assets has been transferred from the Exelon DB Master Trust to the Constellation Pension Trust, the parties shall take all
corrective action necessary to ensure that such assets have been properly transferred between the DB Master Trust and the Constellation
Pension Trust in accordance with ERISA, the Code and the procedures agreed upon by the Exelon Group and the Constellation Group. The Exelon
Group and the Constellation Group, through their respective authorized representatives acting as the named fiduciary of the Exelon Pension
Plans, the Constellation Pension Plans and the Designated Pension Plans, respectively, shall cooperate in good faith in determining the
assets that are transferred in kind as part of the Initial Transfer Amount and the Final Transfer Amount and as to the timing of, and
procedures for, the transfers.

 

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(d)            Indemnification.
The Constellation Group shall indemnify, defend and hold harmless each of the Exelon Indemnitees from and against any and all Losses incurred
or suffered by one or more of the Exelon Indemnitees in connection with, relating to, arising out of or due to, directly or indirectly,
the actions or omissions of the named fiduciary of the Constellation Pension Plans and the Designated Pension Plans relating to the assets
held by the Exelon DB Master Trust allocated for the benefit of the Constellation Pension Trust.

 

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3.3           Nonqualified
Deferred Compensation Plans.

 

(a)            Executive
Plans. Except as provided under Section 3.3(b), effective on or before the Distribution Date, Constellation shall adopt, establish
and maintain nonqualified deferred compensation plans for the benefit of employees of the Constellation Group (the “Constellation
Executive Deferred Compensation Plans”) that in each case shall have substantially the same terms and conditions as the
Exelon Executive Deferred Compensation Plans in which Constellation Employees participate immediately prior to the Distribution Date.
Except as provided under Section 3.3(b) or in Schedule B, as of the Distribution Date, Constellation shall, or shall
cause a member of the Constellation Group to, assume and thereafter be solely responsible for all existing and future liabilities relating
to Constellation Employees’ (and Deceased Constellation Employee survivors’ and beneficiaries’) (a) benefits and
notional account balances accrued under the Exelon Executive Deferred Compensation Plans prior to the Distribution Date, as applicable,
and (b) benefits and notional account balances that accrue under the Constellation Executive Deferred Compensation Plans on and after
the Distribution Date, as applicable. All deferral and distribution elections made by Constellation Employees under the Exelon Executive
Deferred Compensation Plans shall, to the extent applicable, be transferred to, and be in full force and effect under, the Constellation
Executive Deferred Compensation Plans, and for such purpose, and subject to Section 409A of the Code, any distributions payable upon
a Constellation Employee’s separation from service shall be payable upon his or her separation from service with the Constellation
Group. All beneficiary designations made by Constellation Employees and by survivors and beneficiaries of Deceased Constellation Employees
under the Exelon Executive Deferred Compensation Plans shall, to the extent applicable, be transferred to, and be in full force and effect
under, the Constellation Executive Deferred Compensation Plans until such beneficiary designations are replaced or revoked by the Constellation
Employee (or the survivor or beneficiary of the Deceased Constellation Employee) who made the beneficiary designation. Following the Distribution
Date, the Exelon Group shall have no liability or obligation with respect to the benefits accrued by such Constellation Employees or by
such survivors or beneficiaries of Deceased Constellation Employees under any of the Exelon Executive Deferred Compensation Plans or with
respect to any benefits accrued under the Constellation Executive Deferred Compensation Plans. Effective on or as soon as administratively
practicable after the Distribution Date, Constellation shall establish one or more grantor trusts to be a source of providing benefits
under the Constellation Executive Deferred Compensation Plans (the “Constellation Rabbi Trusts”) that shall
have substantially the same terms and conditions as the grantor trusts maintained by Exelon or its Subsidiaries for the corresponding
Exelon Executive Deferred Compensation Plans (the “Exelon Rabbi Trusts”). As soon as administratively practicable
after the Distribution Date, Exelon shall cause the Exelon Rabbi Trusts to transfer to the Constellation Rabbi Trusts cash, life insurance
policies or other assets in an amount equal to the proportion of the assets held in the applicable Exelon Rabbi Trust that are reflected
in the financial statements of the members of the Constellation Group. To the extent the assets held in an Exelon Rabbi Trust are reflected
in the financial statements of BSC, the percentage of such assets to be transferred to a Constellation Rabbi Trust shall be commensurate
with the percentage of the projected benefit obligation or aggregate account balances, as applicable, of all current and former BSC employees
that is allocated to and assumed by Constellation or a member of the Constellation Group pursuant to this Section 3.3(a). Exelon
or the members of the Exelon Group shall retain all liabilities and obligations under the Exelon Executive Deferred Compensation Plans
other than those assumed by Constellation or a member of the Constellation Group pursuant to this Section 3.3(a), and thereafter
(except as described in Schedule B) the Exelon Group shall have no liability whatsoever with respect to the deferred compensation
benefits of Constellation Employees and the Constellation Group shall have no liability whatsoever with respect to the deferred compensation
benefits of Exelon Employees.

 

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(b)            Deferred
Compensation Unit Plans. Notwithstanding Section 3.3(a), the Exelon Group shall retain and be responsible for all obligations
under the Commonwealth Edison Company Deferred Compensation Plan or the Unicom Corporation Deferred Compensation Unit Plan. On or before
the Distribution Date, the Constellation Group shall make a payment to the Exelon Group in an amount the parties agree reflects an estimate
of the actuarial present value of such obligations that relate to Constellation Employees.

 

(c)            Director
Plans. Effective on or before the Distribution Date, Constellation shall adopt, establish and maintain nonqualified deferred compensation
plans for the benefit of nonemployee directors of Constellation (the “Constellation Director Deferred Compensation Plans”)
that in each case shall have substantially the same terms and conditions as the Exelon Director Deferred Compensation Plans in which Constellation
Directors participate. As of the Distribution Date, Constellation shall assume and thereafter be solely responsible for all existing and
future liabilities relating to Constellation Directors’ (a) benefits and notional account balances accrued under the Exelon
Director Deferred Compensation Plans prior to the Distribution Date, as applicable, and (b) benefits and notional account balances
that accrue under the Constellation Director Deferred Compensation Plans on and after the Distribution Date, as applicable. All deferral
and distribution elections made by Constellation Directors under the Exelon Director Deferred Compensation Plans shall, to the extent
applicable, be transferred to, and be in full force and effect under, the Constellation Director Deferred Compensation Plans, and for
such purpose, and subject to Section 409A of the Code, any distributions payable upon a Constellation Director’s separation
from service shall be payable upon his or her separation from service with the Constellation Group. All beneficiary designations made
by Constellation Directors under the Exelon Director Deferred Compensation Plans shall, to the extent applicable, be transferred to, and
be in full force and effect under, the Constellation Director Deferred Compensation Plans until such beneficiary designations are replaced
or revoked by the Constellation Director (or his or her survivor or beneficiary) who made the beneficiary designation. Following the Distribution
Date, the Exelon Group shall have no liability or obligation with respect to the benefits accrued by such Constellation Directors under
any of the Exelon Director Deferred Compensation Plans or with respect to any benefits accrued under the Constellation Director Deferred
Compensation Plans. Any amounts held in an Exelon Rabbi Trust for the benefit of nonemployee directors shall remain in such Exelon Rabbi
Trust. Exelon shall retain all liabilities and obligations under the Exelon Director Deferred Compensation Plans other than those assumed
by Constellation or a member of the Constellation Group pursuant to this Section 3.3(b), and thereafter neither the Exelon Group
nor the Constellation Group shall have any liability whatsoever with respect to the director deferred compensation plans of the other
group.

 

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ARTICLE IV

 

WELFARE PLANS

 

4.1           Establishment
of the Constellation Welfare Plans. Effective on or before the Distribution Date, Constellation
shall adopt, establish and maintain Welfare Plans for the benefit of employees of the Constellation Group that have substantially the
same terms and conditions as the Exelon Welfare Plans (the “Constellation Welfare Plans”).

 

4.2           Coverage
of Constellation Employees and Surviving Dependents. As of the Distribution Date, each Constellation
Employee and each Surviving Dependent shall become eligible to participate in the Constellation Welfare Plans, subject to the terms of
such plans. To the extent applicable to any Constellation Welfare Plans in which Constellation Employees or Surviving Dependents become
eligible as of the Distribution Date that provide benefits similar to the benefits that had been provided to such persons under an Exelon
Welfare Plan immediately prior to such date, Constellation shall cause the Constellation Welfare Plans to recognize all coverage and contribution
elections made by the Constellation Employees and Surviving Dependents under the Exelon Welfare Plans in effect for the period immediately
prior to the Distribution Date and shall apply such elections under the Constellation Welfare Plans for the remainder of the period or
periods for which such elections are by their terms applicable. All beneficiary designations made by Constellation Employees and Surviving
Dependents under the Exelon Welfare Plans shall, to the extent applicable, be transferred to, and be in full force and effect under, the
Constellation Welfare Plans until such beneficiary designations are replaced or revoked by the Constellation Employee or Surviving Dependent
who made the beneficiary designation. With respect to each Constellation Employee and Surviving Dependent, each Constellation Welfare
Plan shall provide that for purposes of determining eligibility to participate and calculation of, and entitlement to, benefits, service
by the Constellation Employee (or, in the case of a Surviving Dependent, the Deceased Constellation Employee) prior to the Distribution
Date with Exelon and its Subsidiaries shall be treated as service with the Constellation Group. Constellation shall cause each Constellation
Welfare Plan to waive any waiting periods, evidence of insurability requirements, and the application of any preexisting condition limitations
with respect to each Constellation Employee (and, if applicable, such Constellation Employee’s participating spouse and/or dependents)
and Surviving Dependent. Constellation shall cause each Constellation Welfare Plan to honor any deductible, co-payment and out-of-pocket
maximums incurred by each Constellation Employee (and, if applicable, such Constellation Employee’s participating spouse and/or
dependents) and Surviving Dependent under the Exelon Welfare Plans in which such Constellation Employee or Surviving Dependent participated
immediately prior to the Distribution Date, if any, in satisfying any deductibles, co-payments or out-of-pocket maximums under the Constellation
Welfare Plans in which such Constellation Employee or Surviving Dependent is eligible to participate after the Distribution Date in the
same plan year in which any such deductibles, co-payments or out-of-pocket maximums were incurred. All amounts credited or applied to
any annual or lifetime benefit limitation under an Exelon Welfare Plan with respect to a Constellation Employee (and, if applicable, such
Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent shall be credited or applied to the annual
or lifetime benefit limitation for such Constellation Employee (and, if applicable, such Constellation Employee’s participating
spouse and/or dependents) or Surviving Dependent under the corresponding Constellation Welfare Plan.

 

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4.3           Welfare
Plan Liabilities.

 

(a)            Constellation
Liabilities. Except as provided in clause (b) of this Section 4.3, Constellation shall, or shall cause a member of
the Constellation Group or the Constellation Welfare Plans, as applicable, to assume, retain and be responsible for all claims for welfare
benefits (and for any Liabilities arising as a result of such claims) incurred with respect to any Constellation Employee (and, if applicable,
such Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent on or after the Distribution Date under
the Constellation Welfare Plans, and none of the Exelon Group nor the Exelon Welfare Plans shall assume or retain any such Liabilities.

 

(b)           Exelon
Liabilities. Except as provided in Section 4.5, Exelon and the Exelon Welfare Plans shall continue to be responsible for all
claims for welfare benefits (and for any Liabilities arising as a result of such claims) incurred with respect to any Constellation Employee
(and, if applicable, such Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent prior to the Distribution
Date (except with respect to any claims for short-term disability benefits and benefits payable pursuant to the Mutual Beneficiary Association
or supplemental disability plan for Constellation Employees represented by Local 15 that are due and payable on and after the Distribution
Date, but incurred prior to the Distribution Date), whether such claims have been paid or remain unpaid as of such date, and none of the
Constellation Group nor the Constellation Welfare Plans shall assume or retain any such Liabilities.

 

(c)           Claims
Incurred. Claims for group health plan benefits shall be considered to be incurred prior to the Distribution Date if the services
related to such claims were provided or commenced, as determined by the plan administrator prior to the Distribution Date. Claims for
all other welfare benefits shall be considered to be incurred prior to the Distribution Date if the date of loss occurred prior to the
Distribution Date.

 

4.4           COBRA
and HIPAA Liabilities. From and after the Distribution Date, the Constellation Group and the
Constellation Welfare Plans shall be responsible for the continuation coverage requirements under the Consolidated Omnibus Budget Reconciliation
Act of 1985 and the portability requirements under the Health Insurance Portability and Accountability Act of 1996 with respect to all
Constellation Employees and their qualified beneficiaries.

 

4.5           Flexible
Spending Accounts. As of the Distribution Date, each Constellation Employee shall become eligible
to participate in a flexible spending account plan established by Constellation (the “Constellation FSA”), subject
to the terms of such plan. Effective as of the Distribution Date, the Constellation FSA shall credit or debit the applicable account of
each Constellation Employee who, as of the Distribution Date, was a participant in the flexible spending account plan maintained by Exelon
(the “Exelon FSA”), with an amount equal to the balance of his or her account under the Exelon FSA as of the
Distribution Date, and shall continue his or her elections thereunder. If the aggregate amount of claims made against all Constellation
Employees’ Exelon FSA accounts prior to the Distribution Date exceed the aggregate of the amounts credited to such accounts at the
Distribution Date, Constellation shall reimburse Exelon for the amount of such difference. If the aggregate of the amounts credited to
all Constellation Employees’ Exelon FSA accounts at the Distribution Date exceed the aggregate amount of claims made against such
account prior to the Distribution Date, Exelon shall reimburse Constellation for the amount of such difference. The Constellation FSA
shall assume responsibility as of the Distribution Date for all outstanding dependent care and medical care claims under the Exelon FSA
of each Constellation Employee, regardless of when the claim was incurred, and shall assume and perform the obligations from and after
the Distribution Date. From and after the Distribution Date, Exelon shall provide Constellation with such information as Constellation
may reasonably request to enable it to verify any claims information pertaining to the Exelon FSA.

 

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4.6            Retiree
Welfare Plans.

 

(a)            Constellation
Retiree Welfare Plans. Effective on or before the Distribution Date, Constellation shall adopt, establish and maintain retiree Welfare
Plans that have substantially the same terms and conditions as the Exelon Retiree Welfare Plans (the “Constellation Retiree
Welfare Plans”).

 

(b)           Coverage
of Constellation Employees and Surviving Dependents. As of the Distribution Date, each Constellation Employee and each Surviving Dependent
shall become eligible to participate in the Constellation Retiree Welfare Plans established by Constellation, subject to the terms of
such plans. To the extent applicable to any Constellation Retiree Welfare Plans in which Constellation Employees or Surviving Dependents
become eligible as of the Distribution Date that provide benefits similar to the benefits that had been provided to such persons under
an Exelon Retiree Welfare Plan immediately prior to such date, Constellation shall cause the Constellation Retiree Welfare Plans to recognize
all coverage and contribution elections made by the Constellation Employees and Surviving Dependents under the Exelon Retiree Welfare
Plans in effect for the period immediately prior to the Distribution Date and shall apply such elections under the Constellation Retiree
Welfare Plans for the remainder of the period or periods for which such elections are by their terms applicable. All beneficiary designations
made by Constellation Employees and Surviving Dependents under the Exelon Retiree Welfare Plans shall, to the extent applicable, be transferred
to, and be in full force and effect under, the Constellation Retiree Welfare Plans until such beneficiary designations are replaced or
revoked by the Constellation Employee or Surviving Dependent who made the beneficiary designation. With respect to each Constellation
Employee and Surviving Dependent, each Constellation Retiree Welfare Plan shall provide that for purposes of determining eligibility to
participate and entitlement to benefits, service by the Constellation Employee (or, in the case of a Surviving Dependent, the Deceased
Constellation Employee) prior to the Distribution Date with Exelon and its Subsidiaries shall be treated as service with the Constellation
Group. Constellation shall cause each Constellation Retiree Welfare Plan to waive any waiting periods, evidence of insurability requirements,
and the application of any preexisting condition limitations with respect to each Constellation Employee (and, if applicable, such Constellation
Employee’s participating spouse and/or dependents) and Surviving Dependent. Constellation shall cause each Constellation Retiree
Welfare Plan to honor any deductible, co-payment and out-of-pocket maximums incurred by each Constellation Employee (and, if applicable,
such Constellation Employee’s participating spouse and/or dependents) and Surviving Dependent under the Exelon Retiree Welfare Plans
in which such Constellation Employee or Surviving Dependent participated immediately prior to the Distribution Date, if any, in satisfying
any deductibles, co-payments or out-of-pocket maximums under the Constellation Retiree Welfare Plans in which such Constellation Employee
or Surviving Dependent is eligible to participate after the Distribution Date in the same plan year in which any such deductibles, co-payments
or out-of-pocket maximums were incurred. All amounts credited or applied to any annual or lifetime benefit limitation under an Exelon
Retiree Welfare Plan with respect to a Constellation Employee (and, if applicable, such Constellation Employee’s participating spouse
and/or dependents) or Surviving Dependent shall be credited or applied to the annual or lifetime benefit limitation for such Constellation
Employee (and, if applicable, such Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent under
the corresponding Constellation Retiree Welfare Plan.

 

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(c)            Retiree
Welfare Plan Liabilities.

 

(1)            Constellation
Liabilities. Except as provided in clause (2) of this Section 4.6(c), Constellation shall, or shall cause a member
of the Constellation Group or the Constellation Retiree Welfare Plans, as applicable, to assume, retain and be responsible for all claims
for retiree welfare benefits (and for any Liabilities arising as a result of such claims) incurred with respect to any Constellation Employee
(and, if applicable, such Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent on or after the
Distribution Date under the Constellation Retiree Welfare Plans, and none of the Exelon Group nor the Exelon Retiree Welfare Plans shall
assume or retain any such Liabilities.

 

(2)            Exelon
Liabilities. Exelon and the Exelon Retiree Welfare Plans shall continue to be responsible for all claims for retiree welfare benefits
(and for any Liabilities arising as a result of such claims) incurred with respect to any Constellation Employee (and, if applicable,
such Constellation Employee’s participating spouse and/or dependents) or Surviving Dependent prior to the Distribution Date, whether
such claims have been paid or remain unpaid as of such date, and none of the Constellation Group nor the Constellation Retiree Welfare
Plans shall assume or retain any such Liabilities.

 

(3)            Claims
Incurred. Claims for retiree health benefits shall be considered to be incurred prior to the Distribution Date if the services related
to such claims were provided or commenced, as determined by the plan administrator prior to the Distribution Date. Claims for all other
retiree welfare benefits shall be considered to be incurred prior to the Distribution Date if the date of loss occurred prior to the Distribution
Date.

 

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4.7            Welfare
Plan VEBAs.

 

(a)            Constellation
VEBA Trusts. Effective on or before the Distribution Date, Constellation shall adopt, establish and maintain one or more Constellation
VEBAs that in each case have substantially the same terms and conditions as the Exelon VEBAs and are intended to be tax-exempt under Section 501(c)(9) of
the Code. As soon as practicable after the adoption of the Constellation VEBAs, Constellation shall submit applications for determination
to the IRS that each of the Constellation VEBAs is exempt from federal income tax under Section 501(a) of the Code, and shall
take any actions not inconsistent with Constellation’s other general commitments contained in this Agreement and make any amendments
necessary to receive such determination.

 

(b)            Transfer
of VEBA Assets—Retiree Health Benefits. As soon as administratively practicable following the Distribution Date, the Exelon
Group shall cause the trustees of the Exelon VEBAs maintained for the benefit of retired employees to transfer to the Constellation VEBAs
a portion of the assets equal to a proportionate amount of the accumulated post-retirement benefit obligation (“APBO”) under
FASB Accounting Standards Codification Topic 715 (“ASC 715”).

 

(c)            Transfer
of VEBA Assets—Mutual Beneficiaries Association. As soon as administratively practicable following the Distribution Date, an
amount of assets will be transferred from the Exelon Corporation Mutual Beneficiaries Association (“MBA”) to
the corresponding Constellation VEBA equal to the sum of the cash and contributions receivables reflected on the financial statements
of the MBA as of the Distribution Date which are attributable to payroll contributions of the Constellation Group entities which are participating
employers in the MBA (but limited, with respect to such contributions attributable to Shared Services Employees, to those employees who
are or become employees of a Constellation Group entity immediately prior to the Distribution Date). In addition, an amount of liability
will be transferred from the MBA to such Constellation VEBA in an amount equal to the accounts payable reflected on the financial statements
as of the Distribution Date of each participating employer in the MBA which is a Constellation Group entity (but limited, with respect
to such liabilities of Shared Services Employees, to those employees who are or become employees of a Constellation Group entity immediately
before the Distribution Date.

 

(d)            Transfer
of VEBA Assets—Active Employees. As soon as administratively practicable following the Distribution Date, including any time
needed to determine payment of incurred but not reported claims and its impact on the transfer, an amount of assets will be transferred
from the Exelon Corporation Employees’ Benefit Trust (“EBT”) to the corresponding Constellation VEBA equal to a proportional
share of the trust balance, if any, based on 2021 payroll contributions assuming 40% of BSC’s payroll contributions are allocated
to the Constellation Group.

 

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ARTICLE V

 

NON-ERISA BENEFIT ARRANGEMENTS

 

5.1            Constellation
Non-ERISA Benefit Arrangements. Effective on or before the Distribution Date, the Constellation
Group shall adopt, establish and maintain Non-ERISA Benefit Arrangements for the benefit of the Constellation Employees that have substantially
the same terms and conditions as the Exelon Non-ERISA Benefit Arrangements.

 

5.2            Short-Term
Cash Incentives. To the extent they are not paid prior to the Distribution Date, Exelon shall
pay to all Exelon Employees and Constellation shall pay to all Constellation Employees all annual bonuses and any other short-term cash
incentives payable for the 2021 performance period, in accordance with the terms of the applicable annual bonus or incentive program.
Effective as of the Distribution Date, the Constellation Group shall establish an annual bonus or incentive program for the benefit of
the Constellation Employees that provides for the payment of annual bonuses for the performance period that begins on January 1,
2022 and for subsequent fiscal years that begin after the Distribution Date, and the Constellation Group shall be solely responsible for
the payment of all bonuses earned under such program. The Exelon Group shall be solely responsible for the payment of annual bonuses earned
by Exelon Employees for the performance period that begins on January 1, 2022 and for subsequent fiscal years that begin after the
Distribution Date.

 

5.3            Long-Term
Cash Incentives. Effective on or before the Distribution Date, the Constellation Group shall
establish long-term cash incentive plans and programs for the benefit of Constellation Employees that have substantially the same terms
and conditions as the long-term cash incentive plans and programs maintained by Exelon and its Subsidiaries immediately prior to the Distribution
Date. Effective as of the Distribution Date, Constellation shall, or shall cause a member of the Constellation Group to, assume, and the
Exelon Group shall have no liability or obligation with respect to, all long-term cash incentive benefits payable to Constellation Employees
after the Distribution Date. Following the Distribution Date, the Constellation Group shall be solely responsible for administering and
paying all benefits under the applicable long-term cash incentive plans and programs to such Constellation Employees, including Former
Shared Services Employees who are considered Constellation Employees. Exelon shall remain solely responsible for administering and paying
all benefits under the applicable long-term cash incentive plans and programs to all Exelon Employees, including Former Shared Services
Employees who are considered Exelon Employees.

 

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5.4            Severance.
Effective on or before the Distribution Date, the Constellation Group shall establish severance plans, arrangements and policies for the
benefit of Constellation Employees that have substantially the same terms and conditions as the severance plans, arrangements and polices
maintained by Exelon and its Subsidiaries immediately prior to the Distribution Date (including without limitation the Exelon Senior Management
Severance Plan). Except as set forth on Schedule B, effective as of the Distribution Date, Constellation shall, or shall cause
a member of the Constellation Group to, assume, and the Exelon Group shall have no liability or obligation with respect to, the severance
benefits provided to such Constellation Employees. Except as set forth on Schedule B, following the Distribution Date, the Constellation
Group shall be solely responsible for administering and paying all benefits under the applicable severance plans, arrangements, policies
or agreements to such Constellation Employees, including Former Shared Services Employees who are considered Constellation Employees.
Exelon shall remain solely responsible for administering and paying all benefits under the applicable severance plans, arrangements, policies
or agreements to all Exelon Employees, including Former Shared Services Employees who are considered Exelon Employees. It is not intended
that any Constellation Employee will be eligible for termination or severance payments or benefits from any member of the Exelon Group
or the Constellation Group as a result of the transfer or change of employment from the Exelon Group to the Constellation Group or the
transfer or change of employment from the Constellation Group to the Exelon Group, in either case in connection with the Distribution.
Notwithstanding the preceding sentence, (i) in the event that any such termination or severance payments or benefits become payable
on account of such transfer, change or the refusal of a Constellation Employee to accept employment with the Constellation Group, the
Constellation Group shall indemnify each of the Exelon Group members for the amount of such termination or severance payments or benefits
and (ii) in the event that any such termination or severance payments or benefits become payable on account of such transfer, change
or the refusal of an Exelon Employee to accept employment with the Exelon Group, the Exelon Group shall indemnify each of the Constellation
Group members for the amount of such termination or severance payments or benefits.

 

5.5            Fringe
Benefits. Effective on or before the Distribution Date, the Constellation Group shall establish
fringe benefit plans (“Constellation Fringe Benefit Plans”) that have terms that are substantially similar to
the fringe benefit plans maintained by the Exelon Group (“Exelon Fringe Benefit Plans”). As of the Distribution
Date, the Constellation Employees shall cease to participate in the Exelon Fringe Benefit Plans, and shall commence participation in the
Constellation Fringe Benefit Plans in accordance with their terms. As of the Distribution Date, Constellation shall, or shall cause a
member of the Constellation Group to, assume all liabilities and obligations to the Constellation Employees under the Exelon Fringe Benefit
Plans and be solely responsible for administering and paying the benefits thereunder, regardless of whether the event giving rise to such
obligation occurred before, at or after the Distribution Date, and the Exelon Group shall be relieved of all such liabilities and obligations.
The Exelon Group shall retain all liabilities and obligations to Exelon Employees under the Exelon Fringe Benefit Plans and be solely
responsible for administering and paying the benefits thereunder.

 

ARTICLE VI

 

STOCK PLANS

 

6.1           Constellation
Stock Plans. Effective on or before the Distribution Date, the Constellation Group shall adopt,
establish and maintain a Constellation Stock Plan that has substantially the same terms and conditions as the Exelon Corporation 2020
Long-Term Incentive Plan (the “Constellation Stock Plan”).

 

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6.2           Restricted
Stock Units; Deferred Stock Units.

 

(a)            Stock
Awards Held by Constellation Employees and Constellation Non-Employee Directors. Exelon and Constellation shall take any and all action
as shall be necessary or appropriate, including approval of the provisions of this Section 6.2(a) by the Constellation Board
and the Exelon Compensation Committee or Exelon Corporate Governance Committee pursuant to the terms of the applicable Exelon Stock Plan,
the applicable Constellation Stock Plan and this Agreement, so that each Exelon RSU Award and each Exelon DSU Award (collectively, the
 “Exelon Stock Awards”) held immediately prior to the Distribution by a Constellation Employee or Constellation
Director shall be replaced, respectively, with a substitute Constellation restricted stock unit award (a “Substitute Constellation
RSU Award”), or substitute Constellation deferred stock unit award (a “Substitute Constellation DSU Award,”
and collectively together with the Substitute Constellation RSU Awards, the “Substitute Constellation Stock Awards”).
The number of Constellation restricted stock units and deferred stock units, as applicable, subject to each Substitute Constellation Stock
Award shall be equal to the number of Exelon restricted stock units or deferred stock units, as applicable, subject to the applicable
Exelon Stock Award held by the participant immediately prior to the Distribution multiplied by a fraction, the numerator of which is the
Exelon Pre-Distribution Stock Price, and the denominator of which is the Constellation Post-Distribution Stock Price (such fraction, the
 “Constellation Conversion Ratio”). Each Substitute Constellation Stock Award shall vest and be payable based
on the holder’s employment or service with the Constellation Group. Each Substitute Constellation Stock Award shall have substantially
the same terms and conditions as the corresponding Exelon Stock Award, except as provided herein.

 

(b)            Stock
Awards Held by Persons Other Than Constellation Employees and Constellation Directors. Exelon shall take any and all action as shall
be necessary or appropriate, including approval of the provisions of this Section 6.2(b) by the Exelon Compensation Committee
or Exelon Corporate Governance Committee pursuant to the terms of the applicable Exelon Stock Plan and this Agreement, so that each Exelon
Stock Award held immediately prior to the Distribution by any person who is not a Constellation Employee or Constellation Director shall
be adjusted (an “Adjusted Exelon Stock Award”). The number of Exelon restricted stock units and deferred stock
units, as applicable, subject to each Adjusted Exelon Stock Award shall be equal to the number of Exelon restricted stock units and deferred
stock units, as applicable, subject to the applicable Exelon Stock Award held by a participant immediately prior to the Distribution multiplied
by a fraction, the numerator of which is the Exelon Pre-Distribution Stock Price, and the denominator of which is the Exelon Post-Distribution
Stock Price (such fraction, the “Exelon Conversion Ratio”). Each Adjusted Exelon Stock Award shall have substantially
the same terms and conditions as the corresponding Exelon Stock Award, except as provided herein.

 

6.3            Performance
Share Awards.

 

(a)            Performance
Share Awards Held by Constellation Employees (Other than Former Shared Services Employees).

 

(1)            2019
Performance Share Awards. To the extent not paid prior to the Distribution Date, Constellation shall pay to each Constellation Employee,
as applicable, other than a Former Shared Services Employee, a cash payment equal to the value of such Constellation Employee’s
Performance Share Award that was earned and vested with respect to the 2019-2021 performance period, as approved by the Exelon Compensation
Committee.

 

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(2)            2020
Performance Share Awards. Exelon and Constellation shall take any and all action as shall be necessary or appropriate, including approval
of the provisions of this Section 6.3(b)(2) by the Constellation Board and the Exelon Compensation Committee pursuant to the
terms of the applicable Exelon Stock Plan, the applicable Constellation Stock Plan and this Agreement, so that each Exelon Performance
Share Award granted under an Exelon Stock Plan in 2020 and held immediately prior to the Distribution by a Constellation Employee, other
than a Former Shared Services Employee, will be replaced with a Substitute Constellation RSU Award granted under the applicable Constellation
Stock Plan. The number of Exelon Shares deemed to have been earned pursuant to the Exelon Performance Share Award shall be determined
by the Exelon Compensation Committee based on projected performance results through the end of the applicable performance period. The
number of such Exelon Shares that are deemed to have been earned shall then be converted into a Substitute Constellation RSU Award by
multiplying the number of such earned Exelon Shares by the Constellation Conversion Ratio, with the resulting number being the number
of Constellation Shares subject to the Substitute Constellation RSU Award. Each Substitute Constellation RSU Award shall continue to vest
based solely on holder’s service with the Constellation Group, and shall have the same terms and conditions as the corresponding
Exelon Performance Share Award, except as provided herein.

 

(3)            2021
Performance Share Awards. Exelon and Constellation shall take any and all action as shall be necessary or appropriate, including approval
of the provisions of this Section 6.3(b)(3) by the Constellation Board and the Exelon Compensation Committee pursuant to the
terms of the applicable Exelon Stock Plan, the applicable Constellation Stock Plan and this Agreement, so that each Exelon Performance
Share Award granted under an Exelon Stock Plan in 2021 and held immediately prior to the Distribution by any Constellation Employee, other
than a Former Shared Services Employee, will be replaced with a substitute Constellation performance share award (a “Substitute
Constellation Performance Share Award”) granted under the applicable Constellation Stock Plan. The target number of Constellation
Shares subject to the Substitute Constellation Performance Share Award will be equal to the target number of Exelon Shares subject to
the applicable Exelon Performance Share Award held by the participant immediately prior to the Distribution, adjusted by the total shareholder
return multiplier for the period ending December 31, 2021, as approved by the Exelon Compensation Committee, and then multiplied
by the Constellation Conversion Ratio. Each Substitute Constellation Performance Share Award shall have substantially the same terms and
conditions as the corresponding Exelon Performance Share Award; provided, however, that the applicable performance criteria with respect
to any performance period following the Distribution Date shall be determined by the Constellation Board in its sole discretion.

 

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(b)           Performance
Share Awards Held by Exelon Employees.

 

(1)            2019
Performance Share Awards. To the extent not paid prior to the Distribution Date, Exelon shall pay to each Exelon Employee and each
Former Shared Services Employee, as applicable, a cash payment equal to the value of such Exelon Employee’s or Former Shared Services
Employee’s Performance Share Award that was earned and vested with respect to the 2019-2021 performance period, as approved by the
Exelon Compensation Committee.

 

(2)            2020
Performance Share Awards. Exelon shall take any and all action as shall be necessary or appropriate, including approval of the provisions
of this Section 6.3(b)(2) by the Exelon Compensation Committee pursuant to the terms of the applicable Exelon Stock Plan and
this Agreement, so that each Exelon Performance Share Award granted under an Exelon Stock Plan in 2020 and held immediately prior to the
Distribution by an Exelon Employee shall be adjusted and converted into a time-based Exelon RSU Award, which shall be paid under the terms
of the Exelon Stock Plan and applicable award agreement. The number of Exelon Shares earned pursuant to the Exelon Performance Share Award
shall be determined by the Exelon Compensation Committee based on projected performance results through the end of the applicable performance
period. The number of such Exelon Shares that are deemed earned shall then be multiplied by the Exelon Conversion Ratio, with the resulting
number being the number of Exelon Shares subject to the Exelon RSU Award. Each such Exelon RSU Award shall continue to vest based solely
on holder’s service with the Exelon Group, and shall have the same terms and conditions as the corresponding Exelon Performance
Share Award, except as provided herein.

 

(3)            2021
Performance Share Awards. Exelon shall take any and all action as shall be necessary or appropriate, including approval of the provisions
of this Section 6.3(b)(3) by the Exelon Compensation Committee pursuant to the terms of the applicable Exelon Stock Plan and
this Agreement, so that each Exelon Performance Share Award granted under an Exelon Stock Plan in 2021 and held immediately prior to the
Distribution by an Exelon Employee will be adjusted (an “Adjusted Exelon Performance Share Award”) and paid
under the terms of the Exelon Stock Plan and applicable award agreement. The target number of Exelon Shares subject to the Adjusted Exelon
Performance Share Award will be equal to the target number of Exelon Shares subject to the applicable Exelon Performance Share Award held
by a participant immediately prior to the Distribution, adjusted by the total shareholder return multiplier for the period ending December 31,
2021, as approved by the Exelon Compensation Committee, multiplied by the Exelon Conversion Ratio. Each Adjusted Exelon Performance Share
Award shall have substantially the same terms and conditions as the corresponding Exelon Performance Share Award; provided, however, that
the applicable performance goals with respect to any performance period following the Distribution Date shall be equitably adjusted by
the Exelon Compensation Committee in its sole discretion.

 

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6.4           Stock
Options.

 

(a)            Stock
Options Held by Constellation Employees (Other than Former Shared Services Employees). Exelon and Constellation shall take any and
all action as shall be necessary or appropriate, including approval of the provisions of this Section 6.4(a) by the Constellation
Board and the Exelon Compensation Committee pursuant to the terms of the applicable Exelon Stock Plan, the applicable Constellation Stock
Plan and this Agreement, so that each Exelon Stock Option Award held immediately prior to the Distribution by any Constellation Employee,
other than a Former Shared Services Employee, shall be replaced with a substitute Constellation stock option award granted under the applicable
Constellation Stock Plan (a “Substitute Constellation Stock Option Award”). The number of Constellation Shares
subject to each Substitute Constellation Stock Option Award shall be equal to the number of Exelon Shares subject to the applicable Exelon
Stock Option Award held by the participant immediately prior to the Distribution multiplied by Constellation Conversion Ratio, and the
applicable exercise price for each Substitute Constellation Stock Option Award shall be equal to the exercise price of the applicable
Exelon Stock Option Award held by the participant immediately prior to the Distribution divided by the Constellation Conversion Ratio.
Each Substitute Constellation Stock Option Award shall vest and be payable based on the holder’s employment with the Constellation
Group and shall have the same terms and conditions as the corresponding Exelon Stock Option Award, except as provided herein.

 

(b)            Stock
Options Held by Exelon Employees. Exelon shall take any and all action as shall be necessary or appropriate, including approval of
the provisions of this Section 6.4(b) by the Exelon Compensation Committee pursuant to the terms of the applicable Exelon Stock
Plan and this Agreement, so that each Exelon Stock Option Award held immediately prior to the Distribution by an Exelon Employee shall
be adjusted (an “Adjusted Exelon Stock Option Award”). The number of Exelon Shares subject to each Adjusted
Exelon Stock Option Award shall be equal to the number of Exelon Shares subject to the applicable Exelon Stock Option Award held by the
participant immediately prior to the Distribution multiplied by the Exelon Conversion Ratio, and the applicable exercise price for each
Adjusted Exelon Stock Option Award shall be equal to the exercise price of the applicable Exelon Stock Option Award held by the participant
immediately prior to the Distribution divided by the Exelon Conversion Ratio. Each Adjusted Exelon Stock Option Award shall have the same
terms and conditions as the corresponding Exelon Stock Option Award, except as provided herein.

 

6.5            Awards
Held by Former Shared Services Employees. Exelon shall take any and all action as shall be necessary
or appropriate, including approval of the provisions of this Section 6.5 by the Exelon Compensation Committee pursuant to the terms
of the applicable Exelon Stock Plan and this Agreement, so that each Exelon Performance Share Award and Exelon Stock Option Award held
immediately prior to the Distribution by a Former Shared Services Employee shall be adjusted in the same manner as such awards that are
held by Exelon Employees, in accordance with Section 6.3(b) and 6.4(b), above.

 

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6.6           Employee
Stock Purchase Plans.

 

(a)            Establishment
of the Constellation Employee Stock Purchase Plan. On or before the Distribution Date, Constellation shall adopt an employee stock
purchase plan (the “Constellation ESPP”) for the benefit of employees of the Constellation Group that has substantially
the same terms and conditions as the Exelon Corporation Employee Stock Purchase Plan (the “Exelon ESPP”). The
first offering period under the Constellation ESPP shall commence on or after the Distribution Date, as of a date determined by the Constellation
Board.

 

(b)            Treatment
of Exelon Employee Stock Purchase Plan. The Exelon Board or Compensation Committee shall make such adjustments to the offering period
that is pending under the Exelon ESPP as of the Distribution Date as it determines to be appropriate and in compliance with the terms
of the Exelon ESPP.

 

6.7           Approval
and Terms of Equity Awards. By approval of the Constellation Board and the Exelon Compensation
Committee or the Exelon Corporate Governance Committee pursuant to Sections 6.1, 6.2, 6.3, 6.4, 6.5 and 6.6, Constellation, as issuer
of substitute and replacement awards provided hereunder, and Exelon, as sole shareholder of Constellation, shall adopt and approve, respectively,
the issuance of the substitute and replacement awards provided for herein. Except as set forth above, the substitute Constellation equity
awards shall be subject to the terms of the Constellation Stock Plan and the applicable award agreements under the Exelon Stock Plan,
except that references in such outstanding substitute and replacement Constellation awards to “Board” and “Committee”
shall mean the Board, Compensation Committee, Corporate Governance Committee or any other designated committee of Constellation (as applicable)
and references to the “Company” shall mean Constellation. Notwithstanding the foregoing, substitute awards made under Constellation
Stock Plans pursuant to Constellation’s obligations under this Agreement shall take into account all employment and service with
both Exelon and Constellation, and their respective Subsidiaries and Affiliates, for purposes of determining when such awards vest and
terminate.

 

6.8            No
Change in Control. The Distribution will not constitute a “change in control” for
purposes of Exelon equity awards that are outstanding as of the Distribution Date.

 

ARTICLE VII

 

COMPENSATION MATTERS

AND GENERAL BENEFIT MATTERS

 

7.1           Cessation
of Participation in Exelon Plans and Exelon Non-ERISA Benefit Arrangements. Except as otherwise
provided in this Agreement or as required by the terms of any Exelon Plan or Exelon Non-ERISA Benefit Arrangement, or by applicable law,
Exelon and Constellation shall take any and all action as shall be necessary or appropriate so that participation in Exelon Plans and
Exelon Non-ERISA Benefit Arrangements by all Constellation Employees shall terminate as of the close of business on the Distribution Date
and the members of the Constellation Group shall cease to be participating employers under the terms of such Exelon Plans and Exelon Non-ERISA
Benefit Arrangements as of such time.

 

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7.2           Assumption
of Certain Employee Related Obligations. Except as otherwise provided in this Agreement, effective
as of the Distribution, Constellation shall, or shall cause a member of the Constellation Group to, assume, and the Exelon Group shall
not have any further liability for, the following agreements, obligations and liabilities, and Constellation shall, and shall cause the
members of the Constellation Group to, indemnify, defend and hold harmless each of the Exelon Indemnitees from and against any and all
Losses incurred or suffered by one or more of the Exelon Indemnitees in connection with, relating to, arising out of or due to, directly
or indirectly, any of the following:

 

(a)            all
agreements entered into between any Exelon Group member and any Constellation Employee, independent contractor or other service provider
providing services related to the Constellation Business;

 

(b)            all
collective bargaining agreements, collective agreements, trade union agreements or works council agreements to the extent they cover Constellation
Employees, including (i) Local 15 (five Northern Illinois nuclear plants); (ii) IBEW Local 97 (Fitzpatrick and Nine Mile Point
craft and security); (iii) IBEW Local 614 (legacy PECO power); (iv) IBEW Local 369 (Massachusetts plants – Mystic 7-9,
Medway, Distrigas); (v) National Union of Nuclear Security Officers-Affiliated with LEOSU (Clinton and Braidwood Security); (vi) Security
Professionals and Fire Professionals of America Local 238 (Quad Cities Security); (vii) Service Employees International Union (SEIU)
Local 1 (Dresden and LaSalle Security); (viii) USSU Local 1 (Byron Security); (ix) United Government Security Officers of America
(UGSOA) Local 12 (Limerick Security) and (x) United Government Security Officers of America (UGSOA) Local 12 (TMI Security). In addition,
ExGen shall solely be bound by the ExGen-Local 15 Agreement, and ComEd and BSC shall solely be bound by the ComEd/BSC-Local 15 Agreement.

 

(c)            all
wages, salary, incentive compensation, commissions and bonuses payable to Constellation Employees on or after the Distribution Date, without
regard to when such wages, salary, incentive compensation, commissions or bonuses are or may have been earned;

 

(d)            all
moving expenses and obligations related to relocation, repatriation, transfers or similar items incurred by or owed to any Constellation
Employee;

 

(e)            all
immigration-related, visa, work application or similar rights, obligations and liabilities to the extent they are related to any Constellation
Employees, and for this purpose, the Exelon Group shall transfer to the Constellation Group all I-9s relating to Constellation Employees;

 

(f)            Except
as provided below, all employment agreements, offer letters and letter agreements entered into between (i) any member of the Exelon
Group or Constellation Group and (ii) any Constellation Employee providing for ongoing benefits and/or compensation for such Constellation
Employee; and

 

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(g)            all
liabilities and obligations whatsoever of the Constellation Business with respect to claims made by or with respect to Constellation Employees,
or any other to the extent their employment duties related to the Constellation Business, relating to any employee benefit plan, program
or policy not otherwise retained or assumed by a member of the Exelon Group pursuant to this Agreement, including such liabilities relating
to actions or omissions of or by the Constellation Group or any officer, director, employee or agent thereof prior to the Distribution
Date.

 

Notwithstanding anything to the contrary in this Agreement, if a currently
effective employment agreement requires pension or retiree health benefits to be provided to a Former Shared Services Employee exclusively
by a member of the Exelon Group, such member of the Exelon Group shall retain these obligations and liabilities.

 

7.3           Employee
Benefits in 2022. Except as required by applicable law or the terms of a collective bargaining
agreement, during the period beginning on the Distribution Date and ending on December 31, 2022, each of the Exelon Group and the
Constellation Group shall continue to provide pension, retirement, nonqualified deferred compensation, active and retiree health and welfare,
and severance benefits to their respective employees and retirees that are substantially the same as those provided as of the Distribution
Date, except where such changes are negotiated through collective bargaining or are required by applicable law.

 

7.4           Restrictive
Covenants in Employment and Other Agreements. To the extent permitted under applicable law, following
the Distribution, the Constellation Group shall be considered to be successors to the Exelon Group for purposes of all agreements containing
restrictive covenants (including confidentiality and non-competition provisions) between any Exelon Group member and any Constellation
Employee executed prior to the Distribution Date such that each Exelon Group member and each Constellation Group member shall all enjoy
the rights and benefits under such agreements, with respect to their respective business operations; provided, however,
that (a) in no event shall any Exelon Group member be permitted to enforce any restrictive covenants against any Constellation Employees
in their capacity as employees of any Constellation Group member and (b) in no event shall any Constellation Group member be permitted
to enforce the restrictive covenant agreements against any Exelon Employees in their capacity as employees of any Exelon Group member.

 

7.5           Past
Service Credit. With respect to all Constellation Employees, as of the Distribution Date, the
Constellation Group shall recognize all service recognized under the comparable Exelon Plans and Exelon Non-ERISA Benefit Arrangements
for purposes of determining eligibility, participation, vesting and calculation of benefits under comparable plans and programs maintained
by the Constellation Group, provided that there shall be no duplication of benefits for Constellation Employees under such Constellation
Group plans and programs. Exelon will provide to Constellation copies of any records available to Exelon to document such service, plan
participation and membership and cooperate with Constellation to resolve any discrepancies or obtain any missing data for purposes of
determining benefit eligibility, participation, vesting and calculation of benefits with respect to the Constellation Employees. With
respect to retaining, destroying, transferring, sharing, copying and permitting access to all such information, Exelon and Constellation
shall each comply with all applicable Laws, regulations and internal policies and each party shall indemnify and hold harmless the other
party from and against any and all Liability, claims, actions and damages that arise from a failure (by the indemnifying party) to so
comply with all applicable Laws, regulations and internal policies applicable to such information.

 

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7.6           Accrued
Vacation Days Off. Effective as of the Distribution Date, Constellation shall, or shall cause
a member of the Constellation Group to, recognize and assume all liability for all vacation, holiday, sick leave and personal days off,
including banked vacation, accrued by Constellation Employees as of the Distribution Date, and to credit each Constellation Employee with
such days off accrual.

 

7.7           Leaves
of Absence. The Constellation Group shall continue to apply all leave of absence policies as
in effect immediately prior to the Distribution to inactive Constellation Employees who are on an approved leave of absence as of the
Distribution Date. Leaves of absence taken by Constellation Employees prior to the Distribution Date shall be deemed to have been taken
as employees of Constellation.

 

7.8           Exelon
Assets. Except as otherwise set forth herein, Exelon shall retain all reserves, bank accounts,
trust funds or other balances maintained with respect to Exelon Non-ERISA Benefit Arrangements.

 

7.9           Further
Cooperation; Personnel Records; Data Sharing. The parties shall provide each other such records
and information as reasonably necessary or appropriate to carry out their obligations under applicable Laws, under this Agreement or for
the purposes of administering their respective plans, policies and employment-related agreements, including information relating to vesting,
service, employment status and collective bargaining agreements. Each party shall be responsible for the accuracy of records and information
provided to the other party pursuant to this Section 7.9 and shall indemnify such other party for any losses caused by inaccurate
information that it has provided. Subject to applicable law, all information and records regarding employment and personnel matters of
Constellation Employees shall be accessed, retained, held, used, copied and transmitted after the Distribution Date by Constellation in
accordance with all Laws and policies relating to the collection, storage, retention, use, transmittal, disclosure and destruction of
such records. Access to such records after the Distribution Date will be provided to Exelon in accordance with Article VIII of the
Separation Agreement. Notwithstanding the foregoing, Exelon shall retain reasonable access to those records necessary for Exelon’s
continued administration of any plans or programs or administration of collective bargaining agreements on behalf of Constellation Employees
after the Distribution Date, and Constellation shall retain reasonable access to those records necessary for Constellation’s administration
of any equity award, other compensation or benefit payable or administered by the Constellation Group after the Distribution Date or the
continued administration of collective bargaining agreements, provided that such access shall be limited to individuals who have a job-related
need to access such records. Exelon shall also retain copies of all confidentiality and non-compete agreements with any Constellation
Employee in which Exelon has a valid business interest. With respect to retaining, destroying, transferring, sharing, copying and permitting
access to all such information, Exelon and Constellation shall each comply with all applicable Laws, regulations and internal policies,
and each party shall indemnify and hold harmless the other party from and against any and all liability, claims, actions and damages that
arise from a failure (by the indemnifying party) to so comply with all applicable Laws, regulations and internal policies applicable to
such information.

 

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ARTICLE VIII

 

GENERAL PROVISIONS

 

8.1           Further
Assurances. Subject to the limitations or other provisions of this Agreement, (a) each Party
shall, and shall cause the other members of its Group to, use commercially reasonable efforts (subject to, and in accordance with applicable
Law) to take promptly, or cause to be taken promptly, all actions, and to do promptly, or cause to be done promptly, and to assist and
cooperate with the other Party in doing, all things reasonably necessary, proper or advisable to consummate and make effective the Transactions
and to carry out the intent and purposes of this Agreement, and (b) neither Party shall, nor shall either Party allow any other member
of its Group to, without the prior written consent of the other Party, take any action that would reasonably be expected to prevent or
materially impede, interfere with or delay any of the Transactions. Without limiting the generality of the foregoing, where the cooperation
of third parties, such as insurers or trustees, would be necessary in order for a Party to completely fulfill its obligations under this
Agreement, such Party shall use commercially reasonable efforts to cause such third parties to provide such cooperation.

 

8.2           Employment
and Plan Rights. Notwithstanding anything to the contrary in this Agreement, the Parties expressly
acknowledge and agree that (a) this Agreement is not intended to create an employment-related contract between any member of the
Exelon Group or the Constellation Group, on the one hand, and any employee or service provider, on the other, nor may any current or former
employee or service provider rely on this Agreement as the basis for any breach of any employment-related contract claim against any member
of the Exelon Group or Constellation Group, (b) nothing in this Agreement shall be deemed or construed to require any member of the
Exelon Group or Constellation Group to continue to employ any particular employee or service provider for any period before or after the
Distribution Date, (c) nothing in this Agreement shall be deemed or construed to limit the right of the Exelon Group or Constellation
Group to terminate the employment of any employee or service provider at any time before or after the Distribution Date and (d) nothing
in this Agreement shall be construed as establishing or amending any Pension Plan, Welfare Plan or Non-ERISA Benefit Arrangement, or any
other plan, policy, agreement or arrangement for the benefit of any employee or any other person.

 

8.3           Labor
Relations. To the extent required by applicable law or any Contract or arrangement with a labor
union, works council or similar employee organization, each of the Exelon Group and the Constellation Group shall provide notice, engage
in consultation and take any similar action which may be required on its part in connection with the Distribution and shall fully indemnify
each member of the other group against any Liabilities arising from its failure to comply with such requirements.

 

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8.4           Administrative
Complaints/Litigation. Except as otherwise provided in this Agreement, following the Distribution
Date, Constellation shall, or shall cause a member of the Constellation Group to, assume, and be solely liable for, the handling, administration,
investigation and defense of Actions asserted at any time against Exelon or Constellation by, on behalf of, or in relation to any Constellation
Employee (including any dependent or beneficiary of any Constellation Employee) or other person providing consulting, independent contractor
or similar services in lieu of employment, to the extent such Actions arise out of or relate to employment with (or the provision of such
services to) the Constellation Business or to any related compensation or benefits provided by or on behalf of the Constellation Business
(including but not limited to ERISA benefit claims, claims asserting violation of occupational safety and health standards, claims asserting
violations of employment standards, union grievances, or wrongful dismissal, discrimination or human rights and unemployment compensation
claims). Any Losses arising from such Actions shall be deemed Constellation Liabilities under the Separation Agreement. In any class action
or other multiparty Action, any included Action asserted by, on behalf of, or in relation to any Exelon Employee or other person providing
consulting, independent contractor or similar services in lieu of employment, to the extent such Action arises out of or relates to employment
with (or the provision of such services to) the Exelon Business, shall not constitute Constellation Liabilities, nor shall Constellation
have responsibility for the handling, administration, investigation and defense of any such Action by, on behalf of, or in relation to
any Exelon Employee or other person providing consulting, independent contractor or similar services in lieu of employment to the Exelon
Business. Notwithstanding the foregoing, Actions described in this Section 8.4 shall not include any Action set forth in Schedule
C hereto.

 

8.5           Reimbursement
and Indemnification. The parties hereto agree to reimburse each other, within 30 days of receipt
from the other party of appropriate verification, for all costs and expenses which each may incur on behalf of the other as a result of
any of the Welfare Plans, Pension Plans and Non-ERISA Benefit Arrangements and, as contemplated by Section 5.4, any termination or
severance payments or benefits. All liabilities retained, assumed or indemnified against by Constellation or a member of the Constellation
Group pursuant to this Agreement shall be subject to indemnification under Section 9.2 of the Separation Agreement, and all liabilities
retained, assumed or indemnified against by Exelon or a member of the Exelon Group pursuant to this Agreement shall be subject to indemnification
under Section 9.3 of the Separation Agreement, and all such liabilities shall be subject to the indemnification procedures set forth
in Article IX of the Separation Agreement.

 

8.6           Negotiation
and Dispute Resolution. The parties agree that any dispute, controversy or claim between them
with respect to the matters covered hereby shall be governed by and resolved in accordance with Article X of the Separation Agreement.

 

8.7           Third-Party
Beneficiaries. This Agreement is solely for the benefit of the Parties and should not be deemed
to confer upon third parties (including without limitation any Constellation Employee, any employee or service provider of the Exelon
Group and any of their respective spouses, dependents or beneficiaries) any remedy, claim, liability, reimbursement, cause of action or
other right in excess of those existing without reference to this Agreement.

 

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8.8           Notices.
All notices, requests, permissions, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly
given (i) five (5) Business Days following sending by registered or certified mail, postage prepaid, (ii) when sent, if
sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient,
and on the next Business Day if sent after normal business hours of the recipient, (iii) when delivered, if delivered personally
to the intended recipient, and (iv) one (1) Business Day following sending by overnight delivery via a national courier service
and, in each case, addressed to a Party at the following address for such Party (as updated from time to time by notice in writing to
the other Party):

 

(a)            If
to Exelon:

 

Exelon Corporation

10 South Dearborn Street

Chicago, Illinois 60603

Attention: General Counsel

Email: gayle.littleton@exeloncorp.com

 

(b)            If
to Constellation:

 

Constellation Energy Corporation

1310 Point Street

Baltimore, Maryland 21231

Attention: General Counsel

Email: david.dardis@constellation.com

 

8.9           Incorporation
by Reference. The following sections of the Separation Agreement are hereby incorporated in this
Agreement by reference to the extent not inconsistent with any of the provisions set forth in this Agreement: Section 8.7 (Confidentiality);
Section 8.8 (Privileged Matters); Section 12.3 (Amendments and Waivers); Section 12.4 (Entire Agreement); Section 12.5
(Survival of Agreements); Section 12.9 (Counterparts; Electronic Delivery); Section 12.10 (Severability); Section 12.11
(Assignability; Binding Effect); Section 12.12 (Governing Law); Section 12.13 (Construction); Section 12.14 (Performance);
Section 12.15 (Title and Headings); and Section 12.16 (Schedules and Exhibits).

 

8.10         Effect
if Distribution Does Not Occur. Notwithstanding anything in this Agreement to the contrary, if
the Separation Agreement is terminated prior to the Distribution, this Agreement shall be of no further force and effect.

 

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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives on the date
first above written.

 

	 	EXELON CORPORATION
	 	 
	 	By:	/s/ Christopher Crane
	 	Name: Christopher Crane
	 	Title: President and Chief Executive Officer
	 	 
	 	 
	 	CONSTELLATION ENERGY CORPORATION
	 	 
	 	By:	/s/ Joseph Dominguez
	 	Name: Joseph Dominguez
	 	Title: President and Chief Executive Officer

 

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Schedules to Employee Matters Agreement

 

Schedule
A: Certain Employees Deemed to be Exelon Employees

 

Schedule
B: Payroll Procedures for Deferred Compensation and Severance Benefits Payable to Former Shared Services Employees in 2022

 

Schedule
C: Allocation of Losses Relating to Certain Existing Benefit Plan Claims

 

    35

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