SENIOR PROMISSORY NOTE

Exhibit 10.3

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ ACT ”), AND MAY NOT BE OFFERED OR SOLD UNLESS REGISTERED PURSUANT TO SUCH ACT OR UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

SENIOR PROMISSORY NOTE

     FOR VALUE RECEIVED, the undersigned, CONSTELLATION ENERGY GROUP, INC., a Maryland corporation (the “ Company ”), hereby unconditionally promises to pay to the order of                                          , a                                          corporation (the “ Initial Holder ”), or its assigns (any such assigns, together with the Initial Holder, the “ Holder ”), the principal sum of ONE BILLION DOLLARS ($1,000,000,000) on the date specified herein, with interest on the unpaid balance of such amount from the date hereof at the rate of interest specified herein.

1. DEFINITIONS

     Capitalized terms and other defined terms used in this Note shall (unless otherwise provided elsewhere in this Note) have the meanings given to them in Annex 1 hereto.

     All references to Sections contained herein shall refer to Sections of this Note unless otherwise stated or the context otherwise requires.

     Except as otherwise provided in this Note, all computations and determinations as to accounting or financial matters (including financial covenants) shall be made in accordance with GAAP consistently applied for all applicable periods, and all accounting or financial terms shall have the meanings ascribed to such terms by GAAP. All financial statements to be delivered pursuant to this Note shall be prepared in accordance with GAAP.

     All other undefined terms contained in this Note shall, unless the context indicates otherwise, have the meanings provided for by the Code as in effect in the State of New York to the extent the same are used or defined therein.

     The words “ include ,” “ includes ,” “ including ” and “ such as ” shall be construed as if followed by the phrase “without limitation.”

     The words “ herein ,” “ hereof ” and “ hereunder ” and other words of similar import refer to this Note as a whole, as the same may from time to time be amended, modified or supplemented and not to any particular section, subsection or clause contained in this Note.

     Unless the context otherwise requires, each term stated in either the singular or plural shall include the singular and the plural, and pronouns stated in the masculine, feminine or neuter gender shall include the masculine, the feminine and the neuter.

     In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding” and the word “through” means “to and including.”

2. TERMS OF PAYMENT

     2.1. Principal . The Company shall pay the entire unpaid principal amount of this Note, together with accrued and unpaid interest thereon through the date of such payment, on the Maturity Date.

     2.2. Optional Prepayment . The Company may, at any time, upon three days’ prior written notice, prepay the outstanding principal amount of this Note, without premium or penalty, in whole or ratably in part, together with accrued and unpaid interest thereon, through the date of such prepayment on the principal amount prepaid. Any such prepayment by the Company shall be applied in the following order: (i) then due and payable fees and expenses under the Note; (ii) then due and payable interest payments on the Note; and (iii) the principal of the Note.

     2.3. Interest .

     (a) The Company shall pay interest on the unpaid principal amount of this Note commencing on the date hereof until such principal amount shall be paid in full at the Applicable Rate. Interest shall be payable monthly in arrears on the last Business Day of each month and on the date of each payment or prepayment of the principal hereof. All payments of interest hereunder shall be computed on the basis of a 360-day year and the number of days elapsed (including the first day but excluding the last day).

     (b) If any payment on this Note becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day and, with respect to payments of interest thereon, shall be payable at the then Applicable Rate during such extension.

     (c) Notwithstanding the foregoing, if any Event of Default shall have occurred and be continuing, the Company shall pay interest on (i) the unpaid principal amount hereof, payable on demand, at a rate per annum equal to the Applicable Rate plus 3.0% per annum and (ii) the amount of any cost, expense or other amount payable hereunder that is not paid when due, from the date such amount shall be due until such amount shall be paid in full, payable on demand (and in any event in arrears on the date such amount shall be paid in full), at a rate per annum equal to the Applicable Rate plus 3.0% per annum.

     (d) Notwithstanding anything to the contrary set forth in this Section 2.3, if at any time until the Maturity Date the Applicable Rate exceeds the highest rate of interest permissible under any law which a court of competent jurisdiction shall, in a final determination, deem applicable hereto (the “ Maximum Lawful Rate ”), then, in such event, and so long as the Maximum Lawful Rate would be so exceeded, the rate of interest payable hereunder shall be equal to the Maximum Lawful Rate; provided , however , that, to the extent permitted by applicable law, if at any time thereafter the Applicable Rate is less than the Maximum Lawful Rate, the Company shall continue to pay interest hereunder at the Maximum Lawful Rate until such time as the total interest received by Holder hereunder is equal to the total interest which Holder would have received had the Applicable Rate been (but for the operation of this paragraph) the interest rate payable since the date hereof. Thereafter, the interest rate payable hereunder shall be the Applicable Rate unless and until the Applicable Rate again exceeds the Maximum Lawful Rate, in which event this paragraph shall again apply. In no event shall the total interest received by Holder pursuant to the terms hereof exceed the amount which Holder could lawfully have received had the interest due hereunder been calculated for the full term hereof at the Maximum Lawful Rate. If the Maximum Lawful Rate is calculated pursuant to this paragraph, such interest shall be calculated at a daily rate equal to the Maximum Lawful Rate divided by the number of days in the year in which such calculation is made. If a court of competent jurisdiction, notwithstanding the provisions of this Section 2.4(d), shall make a final determination that Holder has received interest hereunder in excess of the Maximum Lawful Rate, Holder shall, to the extent permitted by applicable law, promptly apply such excess first to any interest due and not yet paid under its Note, then to the principal amount of its Note (without premium or penalty), then to other unpaid Obligations and thereafter shall refund any excess to the Company or as a court of competent jurisdiction may otherwise order.

     2.4. Receipt of Payment . The Company shall make each payment under this Note not later than 12:00 noon (New York City time) on the Business Day when due, in lawful money of the United States of America, in immediately available funds to Holder’s depository bank as designated by Holder from time to time for deposit in Holder’s depositary account. For purposes only of computing interest hereunder, all payments shall be applied by Holder to the Note on the day payment has been received by Holder in immediately available funds as provided herein.

     2.5. Taxes, Etc .

     (a) Any and all payments by or on account of any obligation of the Company hereunder shall be made without setoff, counterclaim or other defense and free and clear of and without deduction or withholding for any and all Indemnified Taxes or Other Taxes; provided that if the Company shall be required by applicable Requirements of Law to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions Holder receives an amount equal to the sum it would have received had no such deductions or withholdings been made, (ii) the Company shall make such deductions or withholdings and (iii) the Company shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable Requirements of Law.

     (b) Status of Holders. The Initial Holder shall deliver a properly executed Form W-9 to the Company prior to the date of any payment of interest hereunder. Any Foreign Holder that is entitled to an exemption from or reduction of withholding tax under United States law (or any treaty to which the United States is a party) with respect to payments hereunder shall deliver to the Company, at the time or times prescribed by applicable law or reasonably requested by the Company, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding. In addition, any Holder, if requested by the Company, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Company as will enable the Company to determine whether or not such Holder is subject to withholding, backup withholding, or information reporting requirements.

     2.6. Setoff Right . In the event a court having valid jurisdiction over a claim or dispute arising under the Merger Agreement determines by a final nonappealable judgment that Parent or Merger Sub (as such terms are defined in the Merger Agreement) owes damages to the Company under the Merger Agreement (the amount of such damages, the “ recoverable amount ”), the Company shall have the right to setoff against Obligations then payable hereunder and (if no Obligations are then payable) principal of this Note an amount equal to or less than the recoverable amount. At the time of effecting any such setoff, the Company shall provide Holder notice describing in reasonable detail the Obligations being set-off.

3. FINANCIAL STATEMENTS AND OTHER INFORMATION

     3.1. Financial Statements . The Company covenants and agrees that, from and after the date hereof and until all the Obligations have been paid in full, it shall deliver to Holder:

     (a) within 45 days after the end of the first three fiscal quarters of each Fiscal Year, (i) a copy of the unaudited balance sheets of the Company Parties as of the close of such quarter and related statements of income and cash flows for that portion of the Fiscal Year ending as of the close of such quarter, and (ii) a copy of the unaudited statements of income of the Company Parties for such quarter, all prepared in accordance with GAAP (subject to normal year end adjustments) and accompanied by the certification of the chief executive officer or chief financial officer of the Company that all such financial statements present fairly in accordance with GAAP (subject to normal year end adjustments) the financial position, the results of operations and the cash flows of the Company Parties as of the end of such quarter and for the portion of the fiscal year then ended; and

     (b) within 90 days after the close of each Fiscal Year, a copy of the annual audited financial statements of the Company Parties, consisting of a balance sheet and statements of income and retained earnings and cash flows, setting forth in comparative form in each case the figures for the previous fiscal year, which financial statements shall be prepared in accordance with GAAP, certified without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit by PriceWaterhouseCoopers LLP or other firm of independent certified public accountants of recognized national standing reasonably acceptable to the Holder;

all such financial statements to be complete and correct in all material respects.

     3.2. Reports, and Other Information . The Company covenants and agrees that, from and after the date hereof and until all the Obligations have been paid in full, it shall deliver to Holder:

     (a) concurrently with the delivery of the financial statements referred to in Sections 3.1(a) and 3.1(b), a certificate of a Responsible Officer stating that, to the best of such Responsible Officer’s knowledge, the Company during such period has observed or performed all of its covenants and other agreements contained in this Note to be observed or performed by it, and that such Responsible Officer has obtained no knowledge of any Event of Default, except as specified in such certificate;

     (b) not later than 30 days after the end of each fiscal year of the Company, a copy of the projections by the Company of the operating budget and cash flow budget of the Company and its subsidiaries for the current fiscal year, such projections to be accompanied by a certificate of a Responsible Officer to the effect that such projections have been prepared on the basis of sound financial planning practice and that such responsible Officer has no reason to believe they are incorrect or misleading in any material respect

     (c) at the same time the same are sent, copies of all financial statements and reports which the Company sends to its stockholders, and at the same time the same are filed, copies of all financial statements and reports which the Company may make to, or file with, the SEC unless such material is available electronically at www.sec.gov.; and

     (d) promptly, such additional financial and other information as Holder from time to time may reasonably request.

4. AFFIRMATIVE COVENANTS

     The Company covenants and agrees that from and after the date hereof and until all the Obligations have been paid in full:

     4.1. Payment of Obligations . The Company shall, and shall cause each of the other Company Parties to, pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its obligations of whatever nature, except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect hereto have been provided on the books of the Company or the Company Parties, as the case may be./

     4.2. Conduct of Business and Maintenance of Existence . The Company shall, and shall cause each of the other Company Parties to, continue to engage in business of the same general type as now conducted by it and preserve, renew and keep in full force and effect its corporate existence and status (including, in the case of the Company, its good standing with the State Department of Assessments and Taxation of Maryland) and take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of business except as otherwise permitted pursuant to Section 5.3; comply with all Contractual Obligations and Requirements of Law except to the extent that failure to comply therewith could not, in the aggregate, have a Material Adverse Effect.

     4.3. Maintenance of Property; Insurance . The Company shall, and shall cause each of the other Company Parties to, keep all property useful and necessary in its business in good working order and condition; maintain with financially sound and reputable insurance companies insurance on all its property in at least such amounts and against at least such risks (but including in any event public liability, product liability and business interruption) as are usually insured against in the same general area by companies engaged in the same or similar business; and furnish to Holder, upon request, full information as to the insurance carried.

     4.4. Inspection of Property; Books and Records . The Company shall keep adequate records and books of account with respect to its business activities, in which proper entries, reflecting all of the financial transactions of the Company Parties, are made in accordance with GAAP and all requirements of law. The Company shall permit Holder, at Holder’s expense, to visit and inspect the Company Parties’ properties, to examine their books of account and records and to discuss their affairs, finances and accounts with their officers, all at such reasonable times as may be requested by Holder; provided , however , that the Company shall not be obligated pursuant to this Section 4.4 to provide access to any information which it reasonably considers to be a trade secret or similar confidential information

     4.5. Notices . The Company shall promptly give notice to Holder of

     (a) the occurrence of any Default or Event of Default;

     (b) any litigation or proceeding affecting the Company or any Company Party in which the amount involved is $20,000,000 or more and not covered by insurance or in which injunctive or similar relief is sought; and

     (c) the occurrence of any event having or that could reasonably be expected to have a Material Adverse Effect.

     Each notice pursuant to this Section 4.5 shall be accompanied by a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action the Company proposes to take with respect thereto.

5. NEGATIVE COVENANTS

     The Company covenants and agrees that from and after the date hereof and until all the Obligations have been paid in full:

     5.1. Limitation on Indebtedness . The Company shall not, and shall not permit any other Company Party to, create, incur or suffer to exist any Indebtedness except:

     (a) Indebtedness in respect of the Note and other obligations under this Note;

     (b) the Company (but not any other Company Party) may incur Indebtedness that is pari passu or subordinated to the Obligations;

     (c) Indebtedness existing on the Issue Date that was allowed to be outstanding under, or incurred in accordance with, the terms of the Preferred Stock;

     (d) Qualified Refinancing Indebtedness; and

     (e) BG&E and its Subsidiaries may incur and have outstanding Indebtedness consistent with past practice and required regulatory approvals.

     5.2. Limitations on Liens . The Company shall not, and shall not permit any other Company Party to, create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, to secure any Indebtedness or Contingent Obligation except for:

     (a) (i) Liens securing Indebtedness of the Company Parties permitted under Section 5.1(c) if and to the extent such Indebtedness was secured on September 19, 2008 and (ii) Liens securing Qualified Refinancing Indebtedness in respect of Indebtedness referred to in Section 5.2(a)(i) but only if and to the extent the refinanced debt was secured;

     (b) Liens on assets of BG&E and its Subsidiaries securing Indebtedness of BG&E and its Subsidiaries permitted under Section 5.1(e); and

     (c) Permitted Liens.

     5.3. Limitations on Fundamental Changes . The Company shall not, and shall not permit any Company Party to, enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer or otherwise dispose of, all or substantially all of its property, business or assets, or make any material change in its present method of conducting business, except:

     (a) any Subsidiary of the Company may be merged or consolidated with or into the Company (provided that the Company shall be the continuing or surviving corporation) or with or into any one or more wholly owned Subsidiaries of the Company (provided that the Wholly-Owned Subsidiary or Subsidiaries shall be the continuing or surviving corporation) and after giving effect to any of such transactions, no Default or Event of Default shall exist; and

     (b) any Wholly-Owned Subsidiary may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Company or any other Wholly-Owned Subsidiary of the Company.

     5.4. Limitations on Sale of Assets . The Company shall not, and shall not permit any other Company Party to, convey, sell, lease, assign, transfer or otherwise dispose of any of its property, business or assets (including, without limitation, receivables and leasehold interests), whether now owned or hereafter acquired, except:

     (a) obsolete or worn out property disposed of in the ordinary course of business;

     (b) as permitted by Section 5.3(b) and

     (c) Permitted Dispositions.

     5.5. Limitations on Restricted Payments . The Company shall not, and shall not permit any other Company Party to, declare or pay any dividend (other than dividends payable solely in common stock of the Company) on, or make any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any shares of any class of Stock of the Company or any of its Subsidiaries or any warrants or options to purchase any such Stock, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the Company or any Subsidiary (such declarations, payments, setting apart, purchases, redemptions and distributions being herein called “ Restricted Payments ”) except that (i) any Wholly-Owned Subsidiary may declare and pay dividends to the Company or, in the case of any Subsidiary that is wholly owned by any other Subsidiary, to such Subsidiary and (ii) (A) the Company shall be permitted to continue to pay regular cash dividends on its common stock at the rate per annum not to exceed the rate paid at the time of the issuance of this Note and (B) the Company Parties shall be permitted to make Permitted Payments, to the extent applicable.

     5.6. Limitations on Investments, Loans and Advances . The Company shall not, and shall not permit any Company Party to, purchase, hold or acquire beneficially any stock, other securities or evidences of indebtedness of or make any loans or advances to, or make or permit to exist any investment or acquire any interest whatsoever in, any other Person, except:

     (a) extensions of trade credit to customers in the ordinary course of business;

     (b) Permitted Investments;

     (c) loans and advances to officers and employees of the Company in the ordinary course of business and consistent with applicable Requirements of Law;

     (d) Stock of any Subsidiary that is a Subsidiary of the Company on the Issue Date;

     (e) securities acquired in the ordinary course of the business of the Company Parties, consistent with past practice; and

     (f) investments made pursuant to binding commitments existing on the Issue date.

     5.7. Acquisitions . The Company shall not, and shall not permit any other Company Party to, purchase or otherwise acquire any part of the property of any Person (or agree to do any of the foregoing at any time), except that the following shall be permitted:

     (a) capital expenditures in the ordinary course of business consistent with past practice;

     (b) purchases and other acquisitions of inventory, materials, equipment, intangible property and other operating assets in the ordinary course of business consistent with past practice; and

     (c) leases, subleases or licenses of real or personal property in the ordinary course of business.

     5.8. Limitation on Optional Payments and Modifications of Debt Instruments . The Company shall not, and shall not permit any other Company Party to, make any optional payment or prepayment on or redemption, defeasance or purchase of any Indebtedness (other than Indebtedness under this Note), or amend, modify or change, or consent or agree to any amendment, modification or change to any of the terms relating to the payment or prepayment or principal of or interest on, any such Indebtedness, other than any amendment, modification or change which would extend the maturity or reduce the amount of any payment of principal thereof or which would reduce the rate or extend the date for payment of interest thereon.

     5.9. Transactions with Affiliates . The Company shall not, and shall not permit any other Company Party to, enter into any transaction, including, without limitation, any purchase, sale, lease or exchange of property or the rendering of any service, with any Affiliate unless such transaction is (a) otherwise permitted under this Agreement, (b) in the ordinary course of the Company’s or such Subsidiary’s business, (c) upon fair and reasonable terms no less favorable to the Company or such Subsidiary, as the case may be, than it would obtain in a comparable arm’s length transaction with a Person which is not an Affiliate, (d) the issuance of equity-based awards to officers, directors, employees and consultants of the Company Parties consistent with past practice, and (e) the entry into employment and compensation arrangements for officers, employee and directors in the ordinary course of business..

     5.10. Fiscal Year . The Company shall not permit the fiscal year of the Company to end on a day other than December 31.

     5.11. Limitation on Conduct of Business . The Company shall not, and shall not permit any other Company Party to, enter into any business either directly or through any Subsidiary except for businesses in which the Company Parties are engaged on the Issue Date and businesses directly related to such existing businesses.

     5.12. Limitation on Issuance of Stock . The Company shall not permit any other Company Party to issue any Stock (including by way of sales of treasury stock) or any options or warrants to purchase, or securities convertible into, any Stock, except (i) for stock splits, stock dividends and additional issuances of Stock which do not decrease the percentage ownership of the Company or any of its Subsidiaries in any class of the Stock of such Subsidiary, and (ii) Company Parties formed after the Issue Date may issue Stock to the Company or any Wholly-Owned Subsidiary of the Company that is to own such Stock.

6. EVENTS OF DEFAULT; RIGHTS AND REMEDIES

     6.1. Events of Default . The occurrence of any one or more of the following events (regardless of the reason therefor) shall constitute an “ Event of Default ” hereunder:

     (a) The Company shall fail to pay any principal of this Note when due in accordance with the terms hereof.

     (b) The Company shall fail to pay any interest on this Note, or any other amount payable hereunder (other than amounts in respect of principal), within three days after such interest or other amount becomes due in accordance with the terms hereof.

     (c) The Company shall fail to perform, keep or observe (or fail to cause any other Company Party to perform, keep or observe, as the case may be) any provision, covenant or agreement contained in Section 3, Section 4.6 or Section 5 of this Note.

     (d) The Company shall fail to perform, keep or observe (or fail to cause any other Company Party to perform, keep or observe, as the case may be) any other provision, covenant or agreement of or contained in this Note (other than as provided in Sections 6.1 (a), (b) or (c) and the same shall remain unremedied for a period of 30 days).

     (e) Any Company Party shall:

     (i) default in the payment of principal of or interest of any Indebtedness (other than the Note) having an aggregate principal amount of $10,000,000 or more, or in the payment of any Contingent Obligation in an amount of $10,000,000 or more, beyond the period of grace (not to exceed 30 days), if any, provided in the instrument or agreement under which such Indebtedness or Contingent Obligation was created; or

     (ii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or any such Contingent Obligation or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or holders of such Indebtedness or beneficiary or beneficiaries of such Contingent obligation (or a trustee or agent on behalf of such holder or holders or beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or such Contingent Obligation to become payable.

     (f) (i) Any Company Party shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, conservatorship or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement adjustment, winding-up, liquidation, dissolution, composition or ot