Westar Energy, Inc.
A Kansas Corporation
Finance Committee Charter
Adopted December 10, 2003
The Board of Directors of the Company ("Board") created this Finance Committee (the “Committee”) to:
assist the Board and the Company’s management in effective financial management of the Company and its subsidiaries;
assist the Board and the Company’s management in establishing appropriate capital and operating budgets and financial forecasts;
assist the Board and the Company’s management with regard to dividend policy; and
assist the Board and the Company’s management in evaluating matters relating to potential mergers, acquisitions and/or sales or dispositions of assets.
The Committee shall consist of at least three members. The Nominating and Corporate Governance Committee (the “Governance Committee”) shall recommend nominees for appointment to the Committee. Committee members shall be appointed by the Board and may be removed by the Board at any time. The Board shall designate the Chair of the Committee.
Authority and Responsibilities
In addition to any other responsibilities which may be assigned from time to time by the Board, the Committee is authorized to undertake, and has responsibility for, the following matters:
Review and Oversight of Financial Management
The Committee, working with the Company’s management, is responsible for review and oversight of the Company’s financial affairs. The Committee shall advise the Board as to any proposal to issue or retire debt or equity securities, extend credit in any material amount to any affiliated entity or third party (other than through normal cash management pooling arrangements employed by the Company and its affiliates), transfer funds or assets in any material amount to or from any affiliate or third party or for any material investment in new or existing additions to existing assets, except as may otherwise be required by law or regulatory order. While the Committee shall advise the Board as to such matters, absent a specific delegation of authority, approval of any such action or proposal shall be in the exclusive authority of the full Board.
Review and Advise As To Merger, Acquisition, Sale or Disposition Opportunities
Except as may be specified in the Company’s schedule of authorization, or as may be appropriate for routine cash management activities, the Committee is responsible for reviewing any proposal to: (i) acquire the securities, assets or business of any person or entity (including, without limitation, any acquisition by means of stock purchase, merger, consolidation or any other form of business combination); (ii) purchase or invest in the securities, assets or business of any person or entity; or (iii) dispose of any equity or venture investment or other assets of the Company. While the Committee shall advise the Board as to such matters, absent a specific delegation of authority, approval of any such action or proposal shall be in the exclusive authority of the full Board.
Parent Guarantees of Financial Obligations of Subsidiaries
With respect to its subsidiaries and affiliates, the Committee shall review, evaluate and approve corporate credit guarantees, corporate market and/or settlement guarantees, corporate foreign exchange guarantees and letters of comfort in accordance with policies and authority limits approved by the Board.
Management shall report to and apprise the Committee with respect to the establishment of or material change in: (1) the charter of any risk oversight committee of management; (2) risk management policies with respect to energy trading and marketing; and (3) policy and practice regarding financial derivatives with respect to managing interest rate exposure.
Reporting to the Board
The Committee shall report to the Board at least semi-annually. This report shall include a review of any recommendations or issues that arise with respect to the Company’s financial affairs, potential mergers or acquisitions and/or sales of material assets, the management of Company investments and any other matters that the Committee deems appropriate or is requested to be included by the Board.
The Committee shall periodically review and assess the adequacy of this charter and recommend any proposed changes to the Board for approval.
At least annually, the Committee shall evaluate its own performance and report to the Board on such evaluation.
The Committee shall meet as often as it determines is appropriate to carry out its responsibilities under this charter, provided however that it shall report to the Board at least semi-annually. Special meetings of the Committee may be held from time to time pursuant to the call of the Chair of the Committee.
The Chair of the Committee, in consultation with the other committee members, shall determine the frequency and length of the committee meetings, shall set meeting agendas consistent with this charter and shall, when present, preside at all meetings of the Committee. Meetings may be conducted by teleconference. In lieu of a meeting, the Committee may also act by unanimous written consent resolution.
The Committee shall designate a person (who need not be a member of the Committee) to keep minutes of its meetings. The Corporate Secretary of the Company shall retain the minutes.
The Committee may, to the full extent permitted by applicable law or regulation, form and delegate its authority to subcommittees of the Committee when it deems appropriate and in the best interests of the Company.