2003 Committee Charter : AVP

AVON PRODUCTS, INC.
FINANCE AND STRATEGIC PLANNING COMMITTEE CHARTER
Effective as of January 1, 2003
Purpose
The Finance and Strategic Planning Committee is appointed by the Board of Directors to assist the Board in fulfilling its responsibility to oversee: (1) the financial management of the Company, including oversight of the Company's capital structure, financing and risk management strategies, investment strategies, banking relationships and discharge of the Company's duties with respect to the financing of its employee benefit plans; and (2) the strategic management of the Company, including oversight of the Company's plans with respect to possible acquisitions, divestitures or other strategic transactions.
Committee Membership, Structure and Operations
The Committee shall be comprised of three or more members of the Board of Directors, each of whom is determined by the Board of Directors to be "independent" under the rules of the New York Stock Exchange. Additionally, none of the members of the Committee shall be a current or former employee of the Company.
The members and Chair of the Committee shall be appointed annually by the Board upon the recommendation of the Nominating and Corporate Governance Committee and shall serve until the member's successor is duly appointed or until the member's earlier resignation or removal. A member may be removed at any time by the Board, with or without cause.
The Committee shall meet at least four times annually or more frequently as circumstances dictate, and shall meet periodically in executive session. It has at all times direct access to any officer or employee of the Company and to the Company's investment advisors and strategic advisors. The Committee may at any time retain such outside advisors as the Committee deems appropriate to fulfill its responsibilities.
The Finance and Strategic Planning Committee may delegate responsibilities to a subcommittee comprised of one or more members of the Committee, provided that any action taken shall be reported to the full Committee as soon as practicable, but in no event later than at the Committee's next meeting.
The Committee shall review and evaluate annually the performance of the Committee and its members, including review of the compliance by the Committee with this Charter.
The Committee shall also review and assess annually the adequacy of this charter and recommend to the Nominating and Corporate Governance Committee and the Board any changes to the Charter deemed advisable by the Committee.
Responsibilities
In performing its responsibilities, the Committee shall:
1. Review with management on a timely basis significant financial matters of the Company and its subsidiaries, including matters relating to the Company's capitalization, dividend policy and practices, credit ratings, cash flows, borrowing activities, investment of surplus funds and risk management.
2. As part of the foregoing responsibility, the Committee has the authority and responsibility to:
(a) Review and approve the Company's stated annual and long-term financial strategies and objectives and related performance goals;
(b) Review and make recommendations to the Board with respect to:
  • Any offering of the Company's debt or equity securities;
  • Any purchase or disposal of Treasury shares, except the purchase of shares pursuant to authorized and approved employee benefit plans;
  • Any stock split or reclassification of shares;
  • Any filing of a registration statement;
  • Any dividend declaration;
  • Any other matters with respect to the capital stock and other securities of the Company;
  • Any capital transaction or other project expenditure the dollar amount of which is equal to or greater than $40 million or such other amount as the Board may from time to time establish;
  • Any guarantee of unconsolidated third party indebtedness, the dollar amount of which is equal to or greater than $10 million or such other amount as the Board may from time to time establish;
  • Any other financial transaction, such as an investment in a subsidiary or other venture, an asset disposal, or a lien or encumbrance (but excluding any borrowing under existing facilities, as such facilities may be amended or modified from time to time), the dollar amount of which is equal to or greater
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    than $25 million or such other amount as the Board may from time to time establish; and
  • Any tax settlement the amount of which is equal to or greater than $50 million or such other amount as the Board may from time to time establish.
    (c) Review and approve:
  • Any capital transaction or other project expenditure the dollar amount of which is less than $40 million or such other amount as the Board may from time to time establish;
  • Any guarantee of unconsolidated third party indebtedness, the dollar amount of which is less than $10 million or such other amount as the Board may from time to time establish;
  • Any other financial transaction, such as an investment in a subsidiary or other venture, an asset disposal, or a lien or encumbrance (but excluding any borrowing under existing facilities, as such facilities may be amended or modified from time to time), the dollar amount of which is less than $25 million or such other amount as the Board may from time to time establish; and
  • Any tax settlement the amount of which is less than $50 million or such other amount as the Board may from time to time establish;
    provided, that the Committee may delegate to one or more officers of the Company the authority to approve matters that are the subject of this clause (c), subject to the following limits:
  • Capital transactions and other project expenditures in an amount greater than $20 million, or such other amount as the Board may from time to time establish, may not be delegated by the Committee;
  • Any other financial transaction in an amount greater than $15 million, or such other amount as the Board may from time to time establish, may not be delegated by the Committee; and
  • Any tax settlement in an amount greater than $30 million, or such other amount as the Board may from time to time establish, may not be delegated by the Committee.
    3. Review with management the Company's strategic planning process and procedures and its strategic plans, and make recommendations to the Board as appropriate. As part of this responsibility, the Committee shall review and make recommendations to the Board with respect to the terms of proposed acquisitions,
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    4dispositions or other strategic transactions, the dollar value of which is equal to or greater than $25 million or such other amount as the Board may from time to time establish. If the dollar value of any such transaction is less than $25 million, or such other amount as may have been established by the Board, the Committee is authorized to review and approve such transaction; provided, that the Committee may delegate to one or more officers of the Company the authority to approve any such transaction the dollar value of which is equal to or less than $15 million, or such other amount as the Board may establish from time to time.
    4. Review periodically actual capital expenditures and performance against previously approved budgeted amounts.
    5. In consultation with the Audit Committee, as appropriate, review periodically the Company's risk management strategies, including strategies in respect of foreign exchange risk.
    6. Review relationships with the Company's principal lending institutions and investment and strategic advisors.
    7. Review the funding of and asset investment strategy for the Company's employee benefit plans.