BALTIMORE, Mar 20, 2009 (BUSINESS WIRE) -- Constellation Energy (NYSE:CEG) today announced that it will not pay to any Constellation employee any payments it receives from EDF Development, Inc. (EDF) that were originally earmarked for potential payments to its employees under Constellation Energy's long-term incentive plans.
In December 2008, both Constellation Energy and EDF were concerned that the potential instability of the workforce could lead to retention issues among key managers in the company, particularly those highly skilled in the areas of safety and reliability. In response to these concerns, and in light of the fact the company had no existing retention program in place, a decision was made to use an existing long-term incentive plan as a potential retention vehicle. None of the senior officers of Constellation Energy, including the chief executive officer and members of the management committee, were guaranteed payments under the plan.
"In December 2008, Constellation Energy had an urgent need to stabilize the leadership of the company given the tumultuous state of the global markets and Constellation Energy's financial condition at the time," said Mayo A. Shattuck III, chairman, president and chief executive officer of Constellation Energy. "EDF demonstrated a full commitment to the company by agreeing to pay the compensation on two specific long-term plans, which in the aggregate amounted to less than 1 percent of the total annual employee compensation costs of the company.
"Since that time, there has been a tremendous amount of concern over employee compensation throughout the country, and this program has been misconstrued by some as a potential cost to our BGE customers, who we recognize are struggling with high energy bills. The funds for this program were coming entirely from EDF and would not have impacted BGE rates. Nonetheless, we have determined that this issue has become a significant distraction to the important long-term benefits for Maryland that our strategic partnership with EDF represents. Also, since December, the fundamental outlook for Constellation Energy has improved. As a consequence, we have decided to remove this compensation issue from the critically important review of our transaction with EDF."
About Constellation Energy
Constellation Energy (www.constellation.com) is a leading supplier of energy products and services to wholesale and retail electric and natural gas customers. It owns a diversified fleet of generating units located throughout the United States, totaling approximately 9,000 megawatts of generating capacity, and is among the leaders pursuing the development of new nuclear plants in the United States. The company delivers electricity and natural gas through the Baltimore Gas and Electric Company (BGE), its regulated utility in Central Maryland. A FORTUNE 500 company headquartered in Baltimore, Constellation Energy had revenues of $19.8 billion in 2008.
SOURCE: Constellation Energy
Robert Gould, 410-470-7433
Carim Khouzami, 410-470-6440
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