EXHIBIT 10(a)
BALTIMORE GAS AND ELECTRIC COMPANY
NONQUALIFIED DEFERRED COMPENSATION PLAN (PLAN)
1. Objective The objective of this Plan is to enable certain management
employees of BGE and its subsidiaries to defer compensation.
2. Definitions. All words beginning with an initial capital letter and not
otherwise defined herein shall have the meaning set forth in the Employee
Savings Plan. All singular terms defined in this Plan will include the
plural and vice versa. As used herein, the following terms will have the
meaning specified below:
"Basic Compensation" means such compensation as set forth in the Employee
Savings Plan, without regard to the Internal Revenue Code Section
401(a)(17) annual compensation limitation.
"BGE" means Baltimore Gas and Electric Company, a Maryland corporation,
or its successor.
"Committee" means the Committee on Management of the Board of Directors
of BGE.
"Deferred Compensation" means any compensation payable by BGE to a
participant that is deferred under the provisions of this Plan.
"Employee Savings Plan" means the Baltimore Gas and Electric Company
Employee Savings Plan as may be amended from time to time, or any
successor plan.
"Executive Incentive Plan" means the Executive Incentive Plan of
Baltimore Gas and Electric Company as may be amended from time to time,
or any successor plan, and/or any other incentive plan designated in
writing by the Plan Administrator.
"Incentive Award" means an award granted under the Executive Incentive
Plan or the Managers' Incentive Plan.
"Managers' Incentive Plan" means the Managers' Incentive Plan of
Baltimore Gas and Electric Company as may be amended from time to time,
or any successor
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plan, and/or any other incentive plan designated in writing by the Plan
Administrator.
"Matching Contributions" means the matching contributions described in
Section 7.
"Plan Accounts" means amounts of a participant's Deferred Compensation,
Matching Contributions, and earnings under the Plan.
"Plan Administrator" means, as set forth in Section 3, the Vice President
-Management Services, (or the Vice-President succeeding to that
function).
"Rabbi Trust" means the trust established by BGE pursuant to Grantor
Trust Agreement dated as of June 1, 1996 between BGE and T. Rowe Price
Trust Company.
"Termination From Employment with BGE" means a participant's separation
from service with BGE or a subsidiary of BGE; however, a participant's
transfer of employment to or from a subsidiary of BGE shall not
constitute a Termination From Employment with BGE.
3. Plan Administration. The Vice President - Management Services of BGE, (or
the Vice-President succeeding to that function) is the Plan Administrator
and has the sole authority (except as specified otherwise herein) to
interpret the Plan, and, in general, to make all other determinations
advisable for the administration of the Plan to achieve its stated
objective.
Appeals of written decisions by the Plan Administrator may be made to the
Committee. Decisions by the Committee shall be final and not subject to
further appeal. The Plan Administrator shall have the power to delegate
all or any part of his/her duties to one or more designees, and to
withdraw such authority, by written designation.
4. Eligibility and Participation. Each officer or key employee of BGE or its
subsidiaries, or employees of BGE or its subsidiaries who hold manager
level positions, may be designated in writing by the Plan Administrator
as eligible to participate with respect to one or more of the provisions
of Sections 5, 6, and 7 of the Plan, which designation will also indicate
whether all or part of such participant's Plan Accounts
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will be held in the Rabbi Trust. Once designated, eligibility shall
continue until such designation is withdrawn at the discretion and by
written order of the Plan Administrator. Notwithstanding subsequent
withdrawal of eligibility of an employee, such an employee with Plan
Accounts will remain a participant of the Plan, except that no further
deferrals of compensation under the Plan are permitted. While designated
as eligible with respect to one or more of the provisions of Section 5,
6, or 7 of the Plan, an employee may participate in the Plan to the
extent set forth in such designation.
5. Basic Compensation Deferral Election. Unless otherwise designated in
writing by the Plan Administrator, a participant may defer Basic
Compensation as set forth in this Section 5. A participant may elect to
defer up to 15% of monthly Basic Compensation. A participant may also
elect to defer up to 100% of Basic Compensation, if any, in excess of the
dollar limitation set forth in Internal Revenue Code Section 401(a)(17)
(as adjusted by the Commissioner for increases in the cost of living in
accordance with Internal Revenue Code Section 401(a)(17)(B)). Any
deferrals shall be in 1% multiples, subject to adjustment as necessary to
provide for any required withholding taxes. Such election shall be made
by notification in the form and manner established by the Plan
Administrator from time to time, and shall be effective as of the
beginning of the month following the month during which the election is
received by the Plan Administrator. Such election may be revoked by
notification in the form and manner established by the Plan Administrator
from time to time, and shall be effective as of the beginning of the
month following the month during which the revocation is received by the
Plan Administrator.
6. Incentive Award Deferral Election. A participant may elect to defer
Incentive Award compensation in 1% multiples, subject to adjustment as
necessary to provide for any required withholding taxes. Such election
shall be made annually by notification in the form and manner established
by the Plan Administrator from time to time. Such annual election shall
be made prior to the Incentive Award performance year, and shall be
effective as of the first day of such performance year. If a participant
initially becomes
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eligible to participate in the Plan during a performance year, the
election for such performance year must be made prior to the date the
participant initially becomes eligible to participate in the Plan, and
shall be effective on such date. Elections under this Section are
irrevocable once effective.
7. Matching Contributions. Matching Contributions are made by BGE to the
Plan in an amount equal to (i) up to the rate of Company Matching
Contributions under the Employee Savings Plan multiplied by a
participant's monthly Basic Compensation deferral, less (ii) the amount
of Company Matching Contributions made to the Employee Savings Plan on
behalf of such participant with respect to such month.
8. Plan Accounts. Deferred Compensation and Matching Contributions shall be
(i) credited to participant Plan Accounts as soon as practicable; (ii) to
the extent designated by the Plan Administrator, held for the benefit of
the participant in the Rabbi Trust; and (iii) credited with earnings at
the T. Rowe Price Prime Reserve Fund rate. However, a participant may
elect (by notification in the form and manner established by the Plan
Administrator from time to time) to have all or a portion of his/her Plan
Accounts credited with earnings at a rate equal to the T. Rowe Price
Prime Reserve Fund rate, the T. Rowe Price New Income Fund rate, or one
or more of the rates earned by investment options available under the
Employee Savings Plan, except the Common Stock Fund and the Interest
Income Fund. Earnings are credited to Plan Accounts commencing on the day
the Deferred Compensation and Matching Contributions are credited to the
Plan Accounts. Plan Accounts will be valued daily in the same manner as
for Investment Funds under the Employee Savings Plan.
A participant may elect to change the investment option of future
Deferred Compensation and Matching Contributions, which election shall be
effective when the next Deferred Compensation Contributions and/or
Matching Contributions are credited to the participant's Plan Account. A
participant may elect to reallocate to other investment options current
Plan Accounts, which election shall be effective at the same time as, and
valued in accordance with, the interfund transfer provisions under the
Employee Savings Plan.
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Such elections shall be made by notification in the form and manner
established by the Plan Administrator from time to time.
9. Distributions of Plan Accounts. Distributions of Plan Accounts shall be
made in cash only, and to the extent designated by the Plan
Administrator, from the Rabbi Trust.
Prior to the end of the calendar year of a participant's Termination From
Employment with BGE, such participant must elect the timing of
distributions of his/her Plan Accounts. The participant may elect (by
notification in the form and manner established by the Plan Administrator
from time to time) to begin distributions (i) in the calendar year
following the calendar year of the participant's Termination From
Employment with BGE, (ii) in the year following the year in which a
participant attains age 70-1/2, if later, or (iii) any calendar year
between (i) and (ii). A participant may elect (by notification in the
form and manner established by the Plan Administrator from time to time)
to receive distributions in a single payment or in annual installments
during a period not to exceed fifteen years. The single payment or the
first installment payment, whichever is applicable, shall be made within
the first sixty (60) days of the calendar year elected for distribution.
Subsequent installments, if any, shall be made within the first sixty
(60) days of each succeeding calendar year until the participant's Plan
Accounts have been paid. In the event no election is made prior to the
end of the year of a participant's Termination From Employment with BGE,
a participant shall receive a distribution in a single payment within the
first sixty (60) days of the following year. Earnings are credited to
Plan Accounts through the date of distribution, and amounts held for
installment payments shall continue to be credited with earnings, as
specified in Section 8.
If a participant dies, the entire unpaid balance of his/her Plan Accounts
shall be paid to the beneficiary or beneficiaries designated by the
participant by notification in the form and manner established by the
Plan Administrator from time to time or, if no designation was made, to
the estate of the participant. Payment shall be made within sixty (60)
days after notice of death is received by the Plan Administrator.
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In the event a participant's deferred Incentive Award is subsequently
credited to the Plan, such Incentive Award shall be paid immediately to
such beneficiary or beneficiaries.
Notwithstanding anything herein contained to the contrary, the Committee
shall have the right in its sole discretion to vary the manner and timing
of distributions, and may make such distributions in a single payment or
over a shorter or longer period of time than that elected by a
participant.
10. Beneficiaries. A participant shall have the right to designate a
beneficiary or beneficiaries who are to receive a distribution pursuant
to Section 9 in the event of the death of the participant. Any
designation, change or recision of the designation shall be made by
notification in the form and manner established by the Plan Administrator
from time to time. The last designation of beneficiary received by the
Plan Administrator shall be controlling over any testamentary or
purported disposition by the participant, provided that no designation,
recision or change thereof shall be effective unless received by the Plan
Administrator prior to the death of the participant.
If the designated beneficiary is the estate, or the executor or
administrator of the estate, of the participant, a distribution pursuant
to Section 9 may be made to the person(s) or entity (including a trust)
entitled thereto under the will of the participant or, in the case of
intestacy, under the laws relating to intestacy.
Beneficiaries shall have no right to make any investment election or
change in investment election pursuant to Section 8 with respect to a
participant's Plan Accounts.
11. Valuation of Interest. The Plan Administrator shall cause the value of a
participant's Plan Accounts, at least once per year as of December 31, to
be determined separately and be reported to BGE and the participant.
Valuation of a participant's Plan Accounts shall be determined in
accordance with the procedures contained in the Employee Savings Plan.
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12. Withdrawals. No withdrawals of Plan Accounts may be made, except a
participant may at any time request a hardship withdrawal from his/her
Plan Accounts if he/she has incurred an unforeseeable emergency. An
unforeseeable emergency is defined as severe financial hardship to the
participant resulting from a sudden and unexpected illness or accident of
the participant (or of his/her dependents), loss of the participant's
property due to casualty, or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the
control of the participant. The need to send a child to college or the
desire to purchase a home are not considered to be unforeseeable
emergencies. The circumstance that will constitute an unforeseeable
emergency will depend upon the facts of each case.
A hardship withdrawal will be permitted by the Plan Administrator only as
necessary to satisfy an immediate and heavy financial need. A hardship
withdrawal may be permitted only to the extent reasonably necessary to
satisfy the financial need. Payment may not be made to the extent that
such hardship is or may be relieved (i) through reimbursement or
compensation by insurance or otherwise, (ii) by liquidation of the
participant's assets, to the extent the liquidation of such assets would
not itself cause severe financial hardship, or (iii) by cessation of
deferrals under the Plan.
The request for hardship withdrawal shall be made by notification in the
form and manner established by the Plan Administrator from time to time.
Such hardship withdrawal will be permitted only with approval of the Plan
Administrator. The participant will receive a lump sum payment after the
Plan Administrator has had reasonable time to consider and then approve
the request.
13. Miscellaneous. A participant's Plan Accounts shall not be subject to
alienation or assignment by any participant or beneficiary nor shall any
of them be subject to attachment or garnishment or other legal process
except (i) to the extent specially mandated and directed by applicable
State or Federal statute; and (ii) as requested by the participant or
beneficiary to satisfy income tax withholding or liability.
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This Plan may be amended from time to time or suspended or terminated at
any time. All amendments to this Plan which would increase or decrease
the compensation of any senior management officer or key employee of BGE,
either directly or indirectly, must be approved by the Board of
Directors. All other permissible amendments may be made at the written
direction of the Committee. No amendment to or termination of this Plan
shall prejudice the rights of any participant or beneficiary entitled to
receive payment hereunder at the time of such action.
Participation in this Plan shall not constitute a contract of employment
between BGE and any person and shall not be deemed to be consideration
for, or a condition of, continued employment of any person.
The Plan, notwithstanding the creation of the Rabbi Trust, is intended to
be unfunded for purposes of Title I of the Employee Retirement Income
Security Act of 1974. BGE shall make contributions to the Rabbi Trust in
accordance with the terms of the Rabbi Trust. Any funds which may be
invested and any assets which may be held to provide benefits under this
Plan shall continue for all purposes to be a part of the general funds
and assets of BGE and no person other than BGE shall by virtue of the
provisions of this Plan have any interest in such funds and assets. To
the extent that any person acquires a right to receive payments from BGE
under this Plan, such rights shall be no greater than the right of any
unsecured general creditor of BGE.
This Plan shall be governed in all respects by Maryland law.
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