SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement. [ ] Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Section 240.14a-12
(Great Plains Energy Incorporated)
- --------------------------------------------------------------------------------
(Name of Registrant as specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement no.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
GREAT PLAINS ENERGY INCORPORATED
1201 WALNUT
KANSAS CITY, MISSOURI 64106-2124
March 21, 2003
Dear Shareholder:
We are pleased to invite you to the Annual Meeting of Shareholders of
Great Plains Energy Incorporated (Great Plains Energy or the Company). The
meeting will be held at 10:00 a.m. (Central Daylight Time) on Tuesday, May 6,
2003, at The Discovery Center, 4750 Troost, Kansas City, Missouri. At this
meeting, you will be asked to elect ten directors and ratify and approve the
appointment of independent auditors for 2003.
We hope you and your guest will be able to attend the meeting.
Registration and refreshments will be available starting at 9:00 a.m.
Sincerely,
/s/ BERNARD J. BEAUDOIN
Bernard J. Beaudoin
Chairman of the Board
[MAP TO DISCOVERY CENTER]
GREAT PLAINS ENERGY INCORPORATED
1201 Walnut
Kansas City, Missouri 64106-2124
-------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Date: Tuesday, May 6, 2003
Time: 10:00 a.m. (Central Daylight Time)
Place: The Discovery Center
4750 Troost
Kansas City, Missouri
(DIRECTIONS TO THE DISCOVERY CENTER CAN BE FOUND ON THE PRECEDING PAGE)
The purposes of the Annual Meeting are to:
1. Elect ten directors; and
2. Ratify the appointment of independent auditors.
Shareholders of record as of the close of business on February 26, 2003,
are eligible to vote at this meeting.
Kansas City, Missouri
March 21, 2003
- --------------------------------------------------------------------------------
THE DISCOVERY CENTER IS ACCESSIBLE TO ALL SHAREHOLDERS. SHAREHOLDERS WITH
SPECIAL ASSISTANCE NEEDS SHOULD CONTACT THE CORPORATE SECRETARY, GREAT
PLAINS ENERGY INCORPORATED, 1201 WALNUT, KANSAS CITY, MISSOURI 64106-2124,
NO LATER THAN FRIDAY, MAY 2, 2003.
- --------------------------------------------------------------------------------
PROXY STATEMENT
This proxy statement and accompanying proxy card are being mailed,
beginning March 21, 2003, to owners of the common stock of Great Plains Energy
for the solicitation of proxies by the Great Plains Energy Board of Directors
("Board") for the 2003 Annual Meeting of Shareholders. The Board encourages you
to read this document carefully and take this opportunity to vote on the matters
to be decided at the Annual Meeting.
- --------------------------------------------------------------------------------
HOUSEHOLDING DISCLOSURE STATEMENT
Great Plains Energy shareholders that share the same last name and
household mailing address with multiple accounts will receive a "single" copy of
shareholder documents (annual report, proxy statement, prospectus or other
information statement) unless Great Plains Energy is instructed otherwise. Each
registered shareholder will continue to receive a separate proxy card.
Additional copies of these documents will be delivered promptly upon written
request to the Corporate Secretary at 1201 Walnut, Kansas City, Missouri
64106-2124 or oral request by calling our toll-free number 1-800-245-5275.
Shareholders that elect not to participate should contact Great Plains Energy in
writing or by calling our toll-free number 1-800-245-5275 in the same manner.
- --------------------------------------------------------------------------------
i
- --------------------------------------------------------------------------------
CONTENTS
Page
----
Voting Procedures........................................... 1
Corporate Governance........................................ 2
Election of Directors (Item 1 on Proxy Card)................ 4
Security Ownership of Directors and Officers................ 6
Executive Compensation...................................... 7
Option/SAR Grants in the Last Fiscal Year................... 8
Aggregated Option/SAR Exercises in the Last Fiscal Year and
Fiscal Year-End Option/SAR Values......................... 9
Great Plains Energy Pension Plans........................... 9
Great Plains Energy Severance Agreements.................... 10
Certain Relationships and Related Transactions.............. 11
Compensation Committee Report on Executive Compensation..... 12
Stock Performance Graph..................................... 14
Ratification of Appointment of Independent Auditors (Item 2
on Proxy Card)............................................ 15
Audit Committee Report...................................... 16
Submission of Shareholder Proposals and Director
Nominations............................................... 17
Other Business.............................................. 18
Appendix A -- Audit Committee Charter....................... 19
Great Plains Energy Incorporated
1201 Walnut
Kansas City, Missouri 64106-2124
- --------------------------------------------------------------------------------
ii
VOTING PROCEDURES
YOUR VOTE IS VERY IMPORTANT. Your shares can only be voted at the Annual
Meeting if you are present or represented by proxy. Whether or not you plan to
attend the Annual Meeting, you are encouraged to vote by proxy to assure that
your shares will be represented. You may revoke your proxy at any time by:
- written notice to the Corporate Secretary;
- submission of a proxy bearing a later date; or
- casting a ballot during the Annual Meeting proceedings.
Properly executed proxies received by the Corporate Secretary before the close
of voting at the Annual Meeting will be voted according to the directions
provided. If a proxy is returned without shareholder directions, the shares will
be voted as recommended by the Board.
WHO CAN VOTE? Shareholders who own shares of Great Plains Energy's common
stock as of the close of business on February 26, 2003, are entitled to vote at
the meeting or any postponements or adjournments. On that day, approximately
69,189,049 shares of common stock were eligible to vote. Each share is entitled
to one vote on each matter presented at the Annual Meeting.
Cumulative voting is allowed with respect to the election of directors.
This means each shareholder has a total vote equal to the number of shares they
own multiplied by the number of directors to be elected. These votes may be
divided among all nominees equally or may be voted for one or more of the
nominees either in equal or unequal amounts. If votes for a certain director
nominee are withheld, those votes will be distributed equally among the
remaining director nominees. Withholding authority to vote for all director
nominees has the same effect as abstaining from voting for any director nominee.
If no instructions are given, the shares will be voted equally for the election
of all directors. The ten nominees with the highest number of votes will be
elected.
On all other matters, a majority of the votes present at the meeting is
required for approval.
HOW DO I VOTE? Other than by attending the Annual Meeting and voting in
person, there are three ways registered shareholders may vote their shares:
- By Mail
- By Telephone
- By Internet
TO VOTE BY MAIL, simply mark, sign and date the proxy card and return it in the
postage-paid envelope provided. TO VOTE BY TELEPHONE OR INTERNET, 24 hours a
day, 7 days a week, refer to your proxy card for voting instructions. If you
hold your shares through a broker, bank or other nominee, you will receive
separate instructions from the nominee describing how to vote your shares. If
you are an employee participating in Great Plains Energy's Employee Savings Plus
Plan, you will receive separate instructions from the Plan's Trustee, UMB Bank,
n.a., describing how to vote your shares.
1
WHAT SHARES ARE INCLUDED ON THE PROXY CARD? The proxy card represents all
the shares registered to your account including all shares held in your Great
Plains Energy Dividend Reinvestment and Direct Stock Purchase Plan account.
HOW ARE VOTES COUNTED? The Annual Meeting will be held if a quorum,
consisting of a majority of outstanding shares of common stock entitled to vote,
is represented. Broker non-votes, votes withheld and abstentions will be counted
for purposes of determining whether a quorum has been reached.
IS MY VOTE CONFIDENTIAL? Great Plains Energy has a policy of voting
confidentiality. Proxies, ballots and voting tabulations are available for
examination only by the independent Inspector of Election and Tabulators. Your
vote will not be disclosed to the Board or management of Great Plains Energy
except as may be required by law and in other limited circumstances.
WHO WILL SOLICIT PROXIES? The cost of solicitation will be borne by Great
Plains Energy. In addition to the use of the mails, proxies may be solicited by
the directors, officers and employees of Great Plains Energy without additional
compensation. Morrow & Co., Inc., 445 Park Avenue, New York, New York 10022, has
been retained by Great Plains Energy to assist in the distribution of proxy
materials and solicitation of votes for a fee of $6,500 plus reimbursement of
out-of-pocket expenses.
- --------------------------------------------------------------------------------
CORPORATE GOVERNANCE
Great Plains Energy's business, property and affairs are managed under the
direction of the Board. This is in accordance with Missouri General Corporation
Law and Great Plains Energy's Articles of Incorporation and By-Laws. Although
directors are not involved in the day-to-day operating details, they are kept
informed of Great Plains Energy's business through written reports and documents
regularly provided to them. In addition, directors receive operating, financial
and other reports presented by the Chairman and other officers of Great Plains
Energy at Board and committee meetings.
MEETINGS OF THE BOARD. The Board held seven meetings in 2002. Each of the
incumbent directors attended at least 92% of the Board and committee meetings to
which he or she was assigned.
COMMITTEES OF THE BOARD. The Board's four standing committees are
described below. Directors' committee memberships are included in their
biographical information beginning on page 4.
EXECUTIVE COMMITTEE - exercises the full power and authority of the
Board to the extent permitted by Missouri law. The committee generally
meets when action is necessary between scheduled Board meetings.
2
The committee did not meet in 2002.
AUDIT COMMITTEE - oversees the auditing, accounting and financial
reporting of Great Plains Energy by:
- monitoring the integrity of the Company's financial reporting
process and systems of internal controls regarding finance,
accounting, legal and regulatory compliance;
- monitoring the independence, qualifications and performance of the
Company's independent auditors and internal auditing department;
and
- providing an avenue of communication among the independent
auditors, management, internal auditing department and the Board.
The Board has adopted a written charter for the committee which is
attached as Appendix A.
The committee held five meetings in 2002.
COMPENSATION COMMITTEE - reviews and assists the Board in
overseeing compensation matters, including:
- aligning the interest of directors and executives with the
interests of shareholders;
- motivating performance in achievement of the Company's business
objectives;
- administering Great Plains Energy's incentive plans for senior
officers; and
- recommending compensation to be paid to Board members.
The Board has adopted a written charter for the committee.
The committee held three meetings in 2002.
GOVERNANCE COMMITTEE - reviews and assists the Board with all
corporate governance matters including:
- monitoring the effectiveness of the Company and its subsidiaries in
meeting overall objectives and goals of the organization;
- developing and monitoring a set of appropriate corporate governance
principles applicable to Great Plains Energy and its subsidiaries;
- identifying individuals qualified to become board members; and
- management succession planning.
The Board has adopted a written charter for the committee.
The committee held four meetings in 2002.
DIRECTOR COMPENSATION. Compensation is paid to non-employee members of
the Board. An annual retainer of $30,000 was paid in 2002 ($15,000 of which was
used to acquire shares of Great Plains Energy common stock through Great Plains
Energy's Dividend Reinvestment and Direct Stock Purchase Plan on behalf of each
non-employee member of the Board). An additional retainer of $3,000 was paid to
those non-employee directors serving as chair of a committee. Attendance fees of
$1,000 for each Board meeting and $1,000 for each committee meeting
3
attended were also paid in 2002. Directors may defer the receipt of all or part
of the cash retainers and meeting fees.
Great Plains Energy also provides life and medical insurance coverage for
each non-employee member of the Board. The total premiums paid by Great Plains
Energy for this coverage for all participating non-employee directors in 2002
was $18,362.40.
- --------------------------------------------------------------------------------
ELECTION OF DIRECTORS
ITEM 1 ON PROXY CARD
The Board will consist of ten members. The ten nominees have been
recommended to the Board by the Governance Committee to serve as directors until
the next Annual Meeting of Shareholders and until their successors are elected
and qualified. All of the directors elected during 2002 are listed below as
nominees. Each nominee has consented to stand for election, and the Board does
not anticipate any nominee will be unavailable to serve. In the event that one
or more of the director nominees should become unavailable to serve at the time
of the Annual Meeting, shares represented by proxy may be voted for the election
of a nominee to be designated by the Board. Proxies cannot be voted for a
greater number of persons than ten.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE LISTED NOMINEES.
Nominees for Directors
BERNARD J. BEAUDOIN Director since 1999
Mr. Beaudoin, 62, is Chairman of the Board, President and Chief Executive Officer
of Great Plains Energy. He was elected Chairman of the Board and named Chief
Executive Officer of Great Plains Energy in 2001 and elected President in 1999.
Previously, he was President of KLT Inc., a wholly-owned subsidiary of Great
Plains Energy. Mr. Beaudoin served as a member of the Executive Committee during
2002.
DAVID L. BODDE Director since 1994
Dr. Bodde, 60, holds the Charles N. Kimball Chair in Technology and Innovation
(since 1996) at the Bloch School of Business, University of Missouri-Kansas City.
He serves on the board of The Commerce Funds. Dr. Bodde served as a member of the
Audit and Governance Committees during 2002.
MARK A. ERNST Director since 2000
Mr. Ernst, 44, is Chairman of the Board, President and Chief Executive Officer of
H&R Block, Inc., a provider of tax preparation, investment, mortgage and
accounting services. He was elected Chairman of the Board in 2002, Chief Executive
Officer in 2001 and President in 1999. Previously, he was Chief Operating Officer
of the company. He also serves on the board of SCS Transportation. Mr. Ernst
served on the Audit and Compensation Committees during 2002.
RANDALL C. FERGUSON, JR. Director since 2002
Mr. Ferguson, 51, is the retired Senior Location Executive (1998-2003) for the IBM
Western Region. IBM is a leading creator and manufacturer of advanced information
technologies, including computer systems, software, network systems, storage
devices and microelectronics. Mr. Ferguson served on the Audit Committee during
2002.
4
WILLIAM K. HALL Director since 2000
Mr. Hall, 59, is Chairman and Chief Executive Officer (since 2000) of Procyon
Technologies, Inc., a Chicago-based holding company with investments in the
aerospace and defense industries. He was previously President and Chief Executive
Officer of Falcon Building Products, Inc. Mr. Hall serves on the boards of Actuant
Corporation, A. M. Castle & Co., GenCorp and Woodhead Industries. Mr. Hall served
on the Compensation and Executive Committees during 2002.
LUIS A. JIMENEZ Director since 2001
Mr. Jimenez, 58, is Senior Vice President and Chief Strategy Officer (since 2001)
of Pitney Bowes, Inc., a Fortune 300 provider of messaging solutions, office
products and financial services. He served as Vice President, Global Growth and
Future Strategy (1999-2001). Previously, he was Vice President and Practice
Leader, Telecommunications and Media, Latin America, for Arthur D. Little, Inc.,
an international management consulting firm. Mr. Jimenez served on the Governance
Committee during 2002.
JAMES A. MITCHELL Director since 2002
Mr. Mitchell, 61, is the Executive Fellow-Leadership (since 1999), at the Center
for Ethical Business Cultures. He is the retired Executive Vice President of
Marketing and Products (1993-1999) of American Express Company. Mr. Mitchell
served on the Governance Committee during 2002.
WILLIAM C. NELSON Director since 2000
Mr. Nelson, 65, is Chairman (since 2001) of George K. Baum Asset Management, an
asset management advisor. He is the retired Chairman (1990-2000) of Bank of
America Midwest. He serves on the board of DST Systems. Mr. Nelson served on the
Audit and Compensation Committees during 2002.
LINDA H. TALBOTT Director since 1983
Dr. Talbott, 62, is President (since 1975) of Talbott & Associates, international
consultants in strategic planning, philanthropic management and development to
foundations, corporations, and the nonprofit sector. She is Chairman of the Center
for Philanthropic Leadership. Dr. Talbott served as a member of the Executive and
Governance Committees during 2002.
ROBERT H. WEST Director since 1980
Mr. West, 64, is the retired Chairman of the Board (1986-1999) of Butler
Manufacturing Company, a supplier of non-residential building systems, specialty
components, and construction services. He serves on the boards of Astec
Industries, Inc., Burlington Northern Santa Fe Corporation and Commerce
Bancshares, Inc. Mr. West served as a member of the Audit, Executive and
Compensation Committees during 2002.
- --------------------------------------------------------------------------------
5
- --------------------------------------------------------------------------------
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table shows beneficial ownership of Great Plains Energy's
common stock by the named executive officers, directors and all directors and
officers as of January 31, 2003. The total of all shares owned by directors and
officers represents less than one percent of the outstanding shares of Great
Plains Energy's common stock. Management of Great Plains Energy has no knowledge
of any person (as defined by the Securities and Exchange Commission) who owns
beneficially more than 5% of Great Plains Energy common stock.
Shares of
Common Stock
Name of Beneficial Owner Beneficially Owned
------------------------ ------------------
NAMED EXECUTIVE OFFICERS
Bernard J. Beaudoin 9,659 (1)(2)
Andrea F. Bielsker 2,797 (1)
William H. Downey 4,267 (1)
Jeanie S. Latz 16,268 (1)
Douglas M. Morgan 3,397 (1)
OTHER DIRECTOR NOMINEES
David L. Bodde 6,593 (3)
Mark A. Ernst 5,414
Randall C. Ferguson, Jr. 1,221
William K. Hall 8,491
Luis A. Jimenez 1,494
James A. Mitchell 2,121
William C. Nelson 1,796
Linda H. Talbott 7,362
Robert H. West 5,249 (4)
ALL EXECUTIVE OFFICERS AND DIRECTORS AS A GROUP
(25 persons) 105,708 (1)
--------------------
(1) Includes shares held in the Great Plains Energy's Employee Savings Plus
Plan and exercisable non-qualified stock option grants under the
Long-Term Incentive Plan.
(2) Includes 2,879 shares of restricted stock issued under the Long-Term
Incentive Plan.
(3) The nominee disclaims beneficial ownership of 1,000 shares reported and
held by nominee's mother.
(4) The nominee disclaims beneficial ownership of 1,000 shares reported and
held by nominee's wife.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING
Due to travel, Mr. Mitchell's initial Form 3 was filed late.
Mr. Orman's stock acquisition pursuant to the merger described under
Certain Relationships and Related Transactions on page 11 herein was reported
within two days on a Report on Form 8-K and on a timely Report on Form 5. A Form
4 was not filed.
- --------------------------------------------------------------------------------
6
- --------------------------------------------------------------------------------
EXECUTIVE COMPENSATION
The following table contains executive compensation data for Great Plains
Energy's Officers.
SUMMARY COMPENSATION TABLE
Annual Compensation Long Term Compensation
------------------------------------- ------------------------------------
Awards Payouts
-------------------------- -------
Other Annual Restricted Securities LTIP
Compensation Stock Underlying Payouts
Name and Principal Position Year Salary($) Bonus($) ($)(1) Award(s)($) Options/SARs ($)
(a) (b) (c) (d) (e) (f) (g) (h)
--------------------------- ---- ---------- --------- ------------ ----------- ------------ -------
Bernard J. Beaudoin
Chairman of the Board, 2002 415,000 186,750 0 55,000 0
President and Chief 2001 400,000 0 0 55,000 0
Executive Officer 2000 325,000 162,535 0 0 0
Andrea F. Bielsker
Senior Vice President-Finance, 2002 200,000 60,000 0 13,000 0
Chief Financial Officer 2001 180,000 0 0 13,000 0
and Treasurer 2000 140,000 63,991 0 0 0
William H. Downey (3) 2002 260,000 78,000 0 20,000 0
Executive Vice President 2001 250,000 0 0 20,000 0
2000 65,000 54,000 0 0 0
Jeanie Sell Latz 2002 210,000 63,000 0 13,000 0
Executive Vice President- 2001 200,000 0 0 13,000 0
Corporate and Shared Services
and Secretary 2000 180,000 83,506 0 0 0
Douglas M. Morgan 2002 190,000 38,000 0 13,000 0
Vice President-Information 2001 190,000 0 0 13,000 0
Technology and Support 2000 175,000 67,326 0 0 0
Services
All Other
Name and Principal Position Compensation(2)
(a) (i)
--------------------------- ---------------
Bernard J. Beaudoin
Chairman of the Board, 51,486
President and Chief 36,971
Executive Officer 33,174
Andrea F. Bielsker
Senior Vice President-Finance, 18,568
Chief Financial Officer 15,565
and Treasurer 11,213
William H. Downey (3) 14,382
Executive Vice President 5,645
698
Jeanie Sell Latz 29,353
Executive Vice President- 27,056
Corporate and Shared Services
and Secretary 19,121
Douglas M. Morgan 22,537
Vice President-Information 20,990
Technology and Support 18,524
Services
- ---------------
1. While the five named executive officers receive certain perquisites from the
Company, such perquisites did not reach in any of the reported years the
threshold for reporting of the lesser of either $50,000 or ten percent of
salary and bonus set forth in the applicable rules of the Securities and
Exchange.
2. For 2002, amounts include:
* FLEX DOLLARS UNDER THE FLEXIBLE BENEFITS PLAN: Beaudoin -$18,310;
Bielsker -$11,707; Downey -$3,867; Latz -$17,867; and Morgan -$17,037
* DEFERRED FLEX DOLLARS: Beaudoin -$16,157; and Downey -$650
* ABOVE-MARKET INTEREST PAID ON DEFERRED COMPENSATION: Beaudoin -$4,569;
Bielsker -$862; Downey -$2,065; and Latz -$5,186
* GREAT PLAINS ENERGY CONTRIBUTION UNDER THE GREAT PLAINS ENERGY EMPLOYEE
SAVINGS PLUS PLAN: Beaudoin -$5,563; Bielsker -$5,521; Downey -$5,563;
Latz -$5,533; and Morgan -$5,500
* CONTRIBUTION TO DEFERRED COMPENSATION PLAN: Beaudoin -$6,887; Bielsker
-$479; Downey -$2,237; and Latz -$767
3. Mr. Downey was employed as Executive Vice President-KCPL and President-KCPL
Delivery effective September 25, 2000.
- --------------------------------------------------------------------------------
7
- --------------------------------------------------------------------------------
OPTION/SAR GRANTS IN LAST FISCAL YEAR
Potential
Realizable Value
at Assumed
Annual Rates of Alternative
Stock Price to (f) and
Appreciation For (g): Grant
Individual Grants Option Term Date Value
- -------------------------------------------------------------------------- ---------------- -----------
Percent of
Number of Total
Securities Options/SARs Exercise Grant Date
Underlying Granted to or Base Present
Options/SARs Employees in Price Expiration Value ($)
Name Granted (#) Fiscal Year ($/Sh) Date 5% ($) 10% ($) (1)
(a) (b) (c) (d) (e) (f) (g) (f)
---- ------------ ------------ -------- ---------- ------ ------- -----------
Bernard J. Beaudoin 55,000 30.4% $24.90 02-05-2012 $173,173
Andrea F. Bielsker 13,000 7.2% $24.90 02-05-2012 $ 40,932
William H. Downey 20,000 11.0% $24.90 02-05-2012 $ 62,972
Jeanie S. Latz 13,000 7.2% $24.90 02-05-2012 $ 40,932
Douglas M. Morgan 6,000 3.3% $24.90 02-05-2012 $ 18,892
- ---------------
(1) The grant date valuation was calculated by using the binomial option pricing
formula, a derivative of the Black-Scholes model. The underlying assumptions
used to determine the present value of the option were as follows:
Annualized Stock Volatility: 27.503%
Time of Exercise (Option Term): 10 years
Risk Free Interest Rate: 4.57%
Exercise Price (Equal to the Fair Market Value): $24.90
Average Dividend Yield: 7.68%
- --------------------------------------------------------------------------------
8
- --------------------------------------------------------------------------------
AGGREGATED OPTION/SAR EXERCISES IN THE LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES
Number of Securities Value of Unexercised In-
Underlying Unexercised the-Money
Options/SARs at Fiscal Options/SARs at Fiscal
Year End Year End
Shares (#) ($)
Acquired on Value ---------------------- ------------------------
Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable(1)
(a) (b) (c) (d) (e)
---- ----------- -------- ---------------------- ------------------------
Bernard J. Beaudoin 0 0 0/110,000 0/0
Andrea F. Bielsker 0 0 0/ 26,000 0/0
William H. Downey 0 0 0/ 40,000 0/0
Jeanie S. Latz 0 0 12,000/ 26,000 $9,020/0
Douglas M. Morgan 0 0 3,000/ 12,000 0/0
- ---------------
(1) All unexercisable options were out-of-the money on December 31, 2002.
- --------------------------------------------------------------------------------
GREAT PLAINS ENERGY PENSION PLANS
Great Plains Energy has a non-contributory pension plan (the "Great Plains
Energy Pension Plan") for its management employees providing for benefits upon
retirement, normally at age 65. In addition, a supplemental retirement benefit
is provided for executive officers. The following table shows examples of single
life option pension benefits (including unfunded supplemental retirement
benefits) payable upon retirement at age 65 to the named executive officers:
Annual Pension for
Average Annual Base Years of Service Indicated
Salary for Highest ----------------------------------------
36 Months 15 20 25 30 or more
------------------- ------- ------- ------- ----------
150,000 45,000 60,000 75,000 90,000
200,000 60,000 80,000 100,000 120,000
250,000 75,000 100,000 125,000 150,000
300,000 90,000 120,000 150,000 180,000
350,000 105,000 140,000 175,000 210,000
400,000 120,000 160,000 200,000 240,000
450,000 135,000 180,000 225,000 270,000
500,000 150,000 200,000 250,000 300,000
Each eligible employee with 30 or more years of credited service, or whose
age and years of service add up to 85, is entitled to a total monthly annuity
equal to 50% of their average base monthly salary for the period of 36
consecutive months in which their earnings were highest. The monthly annuity
will be proportionately reduced if their years of credited service are less than
30 or do not add up to 85. The compensation covered by the Great Plains Energy
Pension Plan -- base monthly salary -- excludes any bonuses and other
compensation. The Great Plains Energy
9
Pension Plan provides that pension amounts are not reduced by Social Security
benefits. The estimated credited years of service for the named executive
officers in the Summary Compensation table are as follows:
Credited
Officer Years of Service
- ------------------------ ----------------
Bernard J. Beaudoin 22 years
Andrea F. Bielsker 18 years
William H. Downey 2 years
Jeanie S. Latz 22 years
Douglas M. Morgan 24 years
Eligibility for supplemental retirement benefits is limited to executive
officers selected by the Compensation Committee of the Board; all the named
executive officers are participants. The total retirement benefit payable at the
normal retirement date is equal to 2% of highest average earnings, as shown
above, for each year of credited service up to 30 (maximum of 60% of highest
average earnings). The actual retirement benefit paid equals the target
retirement benefit less retirement benefits payable under the management pension
plan. A liability accrues each year to cover the estimated cost of future
supplemental benefits.
The Internal Revenue Code imposes certain limitations on pensions that may
be paid under tax qualified pension plans. In addition to the supplemental
retirement benefits, the amount by which pension benefits exceed the limitations
will be paid outside the qualified plan and accounted for by Great Plains Energy
as an operating expense.
- --------------------------------------------------------------------------------
GREAT PLAINS ENERGY SEVERANCE AGREEMENTS
Great Plains Energy has severance agreements ("Severance Agreements") with
certain of its executive officers, including the named executives, to ensure
their continued service and dedication to and their objectivity in considering
on behalf of Great Plains Energy any transaction that would change the control
of the Company. Under the Severance Agreements, an executive officer would be
entitled to receive a lump-sum cash payment and certain insurance benefits
during the three-year period after a Change in Control (or, if later, the
three-year period following the consummation of a transaction approved by Great
Plains Energy's shareholders constituting a Change in Control) if the officer's
employment was terminated by:
- Great Plains Energy other than for cause or upon death or disability;
- the executive officer for "Good Reason" (as defined in the Severance
Agreements); and
- the executive officer for any reason during a 30-day period commencing
one year after the Change in Control or, if later, commencing one year
following consummation of a transaction approved by Great Plains
Energy's shareholders constituting a change in control (a "Qualifying
Termination").
A Change in Control is defined as:
- an acquisition by a person or group of 20% or more of the Great Plains
Energy common stock (other than an acquisition from or by Great Plains
Energy or by a Great Plains Energy benefit plan);
- a change in a majority of the Board; and
10
- approval by the shareholders of a reorganization, merger or
consolidation (unless shareholders receive 60% or more of the stock of
the surviving Company) or a liquidation, dissolution or sale of
substantially all of Great Plains Energy's assets.
Upon a Qualifying Termination, Great Plains Energy must make a lump-sum
cash payment to the executive officer of:
- the officer's base salary through the date of termination;
- a pro-rated bonus based upon the average of the bonuses paid to the
officer for the last five fiscal years;
- any accrued vacation pay;
- two or three times the officer's highest base salary during the prior 12
months;
- two or three times the average of the bonuses paid to the officer for
the last five fiscal years;
- the actuarial equivalent of the excess of the officer's accrued pension
benefits including supplemental retirement benefits computed without
reduction for early retirement and including two or three additional
years of benefit accrual service, over the officer's vested accrued
pension benefits; and
- the value of any unvested Great Plains Energy contributions for the
benefit of the officer under the Great Plains Energy Employee Savings
Plus Plan.
In addition, Great Plains Energy must offer health, disability and life
insurance plan coverage to the officer and his dependents on the same terms and
conditions that existed immediately prior to the Qualifying Termination for two
or three years, or, if earlier, until the executive officer is covered by
equivalent plan benefits. Great Plains Energy must make certain "gross-up"
payments regarding tax obligations relating to payments under the Severance
Agreements as well as provide reimbursement of certain expenses relating to
possible disputes that might arise.
Payments and other benefits under the Severance Agreements are in addition
to balances due under the Great Plains Energy Long-Term Incentive Plan and
Annual Incentive Plan. Upon a Change in Control (as defined in the Great Plains
Energy Long-Term Incentive Plan), all stock options granted in tandem with
limited stock appreciation rights will be automatically exercised.
- --------------------------------------------------------------------------------
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On November 7, 2002, Innovative Energy Consultants Inc., a wholly-owned
subsidiary of Great Plains Energy, merged with Environmental Lighting Concepts,
Inc., with Innovative Energy Consultants continuing as the surviving corporation
and a wholly-owned subsidiary of Great Plains Energy. At the time of the merger,
Gregory J. Orman was Executive Vice President-Corporate Development and
Strategic Planning of Great Plains Energy and owned approximately 67% of the
stock of Environmental Lighting Concepts. Environmental Lighting Concepts' only
significant asset was a 5.8% indirect ownership interest in Strategic Energy,
L.L.C., an indirect subsidiary of Great Plains Energy, and the merger increased
Great Plains Energy's indirect ownership in Strategic Energy, L.L.C. from
approximately 83% to approximately 89%. On the date of the merger, Mr. Orman
received $10.07 million from Great Plains Energy for his interest in
Environmental Lighting Concepts in the form of 258,917 shares of Great Plains
Energy common stock, valued at $5.34 million, and a short-term note for $4.73
million which was subsequently paid on January 2, 2003.
- --------------------------------------------------------------------------------
11
- --------------------------------------------------------------------------------
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Great Plains Energy is composed
of four independent directors. The Compensation Committee recommends to the
Board the executive compensation structure and administers the policies and
plans that govern compensation for the executive officers of Great Plains
Energy. Executive compensation is consistent with the Great Plains Energy total
remuneration philosophy which provides:
Given Great Plains Energy's strategies in the competitive and demanding
energy marketplace, attracting and retaining talent is a top priority.
Great Plains Energy is committed to establishing total remuneration
levels which are performance-based, competitive with the energy or
utility market for jobs of similar scope to enable the organization to
recruit and retain talented personnel at all levels in a dynamic and
complex marketplace. This will be established through base salary,
benefits and performance-based annual and long-term incentives. The
incentive targets will be consistent with current trends in the energy
or utility sector and the incentive measures will be appropriately tied
to shareholder and customer interests.
The Compensation Committee has not adopted a policy concerning the
Internal Revenue Services' rules on the deductibility of compensation in excess
of $1,000,000.
BASE SALARIES
The Compensation Committee reviews executive officer salaries regularly,
at least once every twelve months, and makes adjustments as warranted. The
Compensation Committee also compares annually executive compensation with
national compensation surveys. Base salaries were established for 2002 on the
basis of:
- job responsibilities and complexity;
- individual performance under established guidelines;
- competitiveness for comparable positions in companies of similar size
within the industry; and
- sustained performance of Great Plains Energy.
ANNUAL INCENTIVES
Under the Great Plains Energy Annual Incentive Plan in 2002 (the "Plan"),
executives received incentive compensation based upon the achievement of a
specific corporate performance target based on Economic Value Added (EVA(R)(1)).
Under the Plan, when shareholder value is increased by the amount of the annual
EVA(R) goal, bonuses are paid at a target level that varies to reflect a
participant's level of responsibility. A minimum level of EVA(R) improvement has
to be achieved before any bonus is awarded. EVA(R) improvement above the annual
goal results in payouts above the target level. In 2002, the EVA(R) goal was met
and bonuses were earned at the target level in the amounts set forth in the
Summary Compensation Table.
- ---------------
(1) EVA(R) is a registered trademark of Stern Stewart & Co. in the United States
of America, France, the United Kingdom, Canada, Australia and Mexico.
12
LONG-TERM INCENTIVE PLAN
The Great Plains Energy Long-Term Incentive Plan, as approved by the
shareholders in May 2002, provides for grants by the Compensation Committee of
stock options, restricted stock, performance shares and other stock-based
awards. The Compensation Committee believes that equity interests in Great
Plains Energy by its executive officers more closely aligns the interests of
management with shareholders and has established stock ownership guidelines for
executive officers based on their level within the organization. Compliance with
these guidelines is taken into consideration in determining grants under the
Long-Term Incentive Plan. Stock options were granted in 2002 in the amounts set
forth in the Summary Compensation Table. The stock options were granted at an
exercise price equal to the fair market value on the date of issuance.
CHIEF EXECUTIVE OFFICER
In determining the base salary for Bernard J. Beaudoin, the Chairman of
the Board, President and Chief Executive Officer in 2002, the Compensation
Committee considered:
- financial performance of Great Plains Energy;
- cost and quality of services provided;
- leadership in enhancing the long-term value of Great Plains Energy; and
- relevant salary data including information supplied by the Edison
Electric Institute (EEI).
Incentive awards to Mr. Beaudoin in 2002 under the Annual Incentive Plan
and Long-Term Incentive Plan were determined in the same manner as other
executive officers.
COMPENSATION COMMITTEE
William C. Nelson (Chairman)
Mark A. Ernst
William K. Hall
Robert H. West
- --------------------------------------------------------------------------------
13
- --------------------------------------------------------------------------------
STOCK PERFORMANCE GRAPH
COMPARISON OF CUMULATIVE TOTAL RETURNS*
GREAT PLAINS ENERGY, S&P 500 INDEX, AND EEI INDEX
[performance graph]
GREAT PLAINS ENERGY S&P 500 EEI INDEX
------------------- ------- ---------
1997 100.00 100.00 100.00
1998 106.00 129.00 114.00
1999 84.00 156.00 93.00
2000 112.00 141.00 137.00
2001 110.00 125.00 125.00
2002 107.00 97.00 107.00
FISCAL YEAR ENDED DECEMBER 31
* Total return assumes reinvestment of dividends.
Assumes $100 invested on December 31, 1997, in Company common stock, S&P 500
Index, and EEI Index
- --------------------------------------------------------------------------------
14
- --------------------------------------------------------------------------------
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
ITEM 2 ON PROXY CARD
Deloitte & Touche LLP, who acted as Great Plains Energy's independent
auditors in 2002, has, upon recommendation of the Audit Committee, been selected
and appointed by the Board of Directors to audit and certify the financial
statements for 2003, subject to ratification and approval by the shareholders of
the Company.
The services of PricewaterhouseCoopers LLP as independent auditors prior
to 2002, were discontinued effective February 8, 2002. PricewaterhouseCoopers
LLP's reports on the financial statements for the years ended December 31, 2000
and 2001 did not contain an adverse opinion or disclaimer of opinion and were
not qualified or modified as to uncertainty, audit scope, or accounting
principles.
Great Plains Energy's Board of Directors, upon recommendation of the
Board's Audit Committee, proposed the change in independent auditors to Deloitte
& Touche LLP. In connection with the audits of the two years ended December 31,
2000 and December 31, 2001, and the subsequent period, there were no
disagreements with PricewaterhouseCoopers LLP on any matters of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure which, if not resolved to their satisfaction, would have caused
PricewaterhouseCoopers LLP to make references thereto in connection with its
report.
Representatives from Deloitte & Touche LLP are expected to be present at
Great Plains Energy's Annual Meeting, with the opportunity to make statements if
they desire to do so, and are expected to be available to respond to appropriate
questions.
The affirmative vote of the holders of a majority of the shares of common
stock of the Company present and entitled to vote at the meeting is required for
the approval of this proposal to ratify and approve the appointment. If the
shareholders do not ratify the appointment of Deloitte & Touche LLP, the
selection of independent public auditors will be reconsidered by the Board.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION.
- --------------------------------------------------------------------------------
15
- --------------------------------------------------------------------------------
AUDIT COMMITTEE REPORT
The Audit Committee is comprised of five independent directors and in
connection with its function to oversee and monitor the financial reporting
process of Great Plains Energy, the Audit Committee has done, among other
things, the following:
- reviewed and discussed the audited financial statements with management;
- discussed with Deloitte & Touche LLP, the Company's independent auditors
for the year ended December 31, 2002, the matters required to be
discussed by Statement on Auditing Standards No. 61;
- discussed with Deloitte & Touche LLP, the auditors' independence from
management and the Company, including the matters in the auditors'
written disclosures required by Independence Standards Board Standard
No. 1; and
- considered whether the non-audit services in the categories below were
compatible with maintaining the principal auditor's independence.
- AUDIT FEES -- $290,000 aggregate fees for professional
services rendered for the 2002 audit and review of the
financial statements included in Great Plains Energy's
quarterly reports on Form 10-Q for 2002.
- FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES -- $0
- ALL OTHER FEES
- AUDIT-RELATED FEES -- $313,100 aggregate fees for comfort
letters, consents, accounting research and employee
benefit plan audits.
- TAX FEES -- $69,797 aggregate fees for tax compliance,
consultation and planning.
Based on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's annual report on Form 10-K for the
fiscal year ended December 31, 2002 for filing with the Securities and Exchange
Commission.
AUDIT COMMITTEE
Mark A. Ernst (Chairman)
David L. Bodde
Randall C. Ferguson, Jr.
William C. Nelson
Robert H. West
- --------------------------------------------------------------------------------
16
- --------------------------------------------------------------------------------
SUBMISSION OF SHAREHOLDER PROPOSALS AND
DIRECTOR NOMINATIONS
SHAREHOLDER PROPOSALS
Shareholders wishing to have a proposal included in the proxy statement
for the Annual Meeting in 2004 must submit a written proposal to the Corporate
Secretary by November 22, 2003. Securities and Exchange Commission rules set
standards for shareholder proposal requirements to be included in a proxy
statement.
If a shareholder intends to bring a matter before a shareholder meeting,
other than by submitting a proposal for inclusion in Great Plains Energy's proxy
statement for that meeting, Great Plains Energy's By-Laws require the
shareholder to give Great Plains Energy notice at least 60 days, but no more
than 90 days, prior to the date of the shareholder meeting. If Great Plains
Energy gives shareholders less than 70 days' notice of a shareholder meeting
date, the shareholder's notice must be received by the Corporate Secretary no
later than the close of business on the tenth (10) day following the earlier of
the date of the mailing of the notice of the meeting or the date in which public
disclosure of the meeting date was made.
To be in proper written form, a shareholder's notice must set forth as to
each matter the shareholder proposes to bring before the shareholder meeting:
- a brief description of the business to be brought before the shareholder
meeting and the reasons for conducting the business at the shareholder
meeting;
- the shareholder's name and record address;
- class or series and number of shares of Great Plains Energy stock the
shareholder owns beneficially or of record;
- a description of all arrangements or understandings between the
shareholder and any other person or persons (including their names) in
connection with the proposal of the business by the shareholder, and any
material interest of the shareholder in such business; and
- the shareholder's representation that they intend to appear in person or
by proxy at the annual meeting to bring such business before the
meeting.
DIRECTOR NOMINATIONS
Great Plains Energy's By-Laws also require shareholders wishing to make a
director nomination at an annual shareholder meeting give Great Plains Energy
notice at least 60 days, but no more than 90 days, prior to the date of the
shareholder meeting. If Great Plains Energy gives shareholders less than 70
days' notice of a shareholder meeting date, the shareholder's notice must be
received by the Corporate Secretary no later than the close of business on the
tenth (10) day following the earlier of the date of mailing of the notice of the
meeting or the date on which public disclosure of the meeting was made.
17
For a director nominee election to be in proper written form, a
shareholder's notice to the Corporate Secretary must include:
the shareholder's
- name and shareholder record; and
- class or series of Great Plains Energy stock and number of shares
beneficially held;
and
the nominee's
- name, age, business address and residence address;
- principal occupation or employment;
- class or series of Great Plains Energy stock and number of shares
owned beneficially; and
- written consent of the nominee to serve as a director, if elected.
The notice must also provide:
- a description of all arrangements or understandings between the
shareholder and the nominee;
- a representation that the shareholder intends to appear in person or
by proxy at the shareholders' meeting to nominate the nominee; and
- any other information relating to the shareholder and the nominee
that is required to be reported in a proxy statement or other
filings as required by Securities and Exchange Commission rules.
No person shall be eligible for election as a director unless nominated
according to procedures in Great Plains Energy's By-Laws as described above.
Shareholders may request a copy of the By-Laws by contacting the Corporate
Secretary, Great Plains Energy Incorporated, 1201 Walnut, Kansas City, Missouri
64106-2124.
- --------------------------------------------------------------------------------
OTHER BUSINESS
Great Plains Energy is not aware of any other matters that will be
presented for shareholder action at the Annual Meeting. If other matters are
properly introduced, the persons named in the accompanying proxy will vote the
shares they represent according to their judgment.
By Order of the Board of Directors
/s/ Jeanie Sell Latz
Jeanie Sell Latz
Executive Vice President-Corporate and
Shared Services and Corporate
Secretary
Kansas City, Missouri
March 21, 2003
- --------------------------------------------------------------------------------
18
APPENDIX A
GREAT PLAINS ENERGY INCORPORATED
AUDIT COMMITTEE
REVISED MARCH 4, 2003
I. PURPOSE
There shall be an Audit Committee whose members shall be appointed by the
Board of Directors to assist the Board in fulfilling its oversight
responsibilities.
The Audit Committee's primary purposes are to:
- Monitor the integrity of the Company's financial statements
including the reporting process and systems of internal controls
regarding finance, accounting, legal and regulatory compliance.
- Review the independence, qualifications and performance of the
Company's independent auditors and internal auditing department.
- Provide an avenue of communication among the independent auditors,
management, internal auditing department and the Board.
- Review and approve the report required by the Securities and
Exchange Commission for the Company's proxy statement.
The Audit Committee has the authority to conduct any investigation
appropriate in fulfilling its responsibilities, and it has direct access to
the independent auditors as well as anyone in the organization. The Audit
Committee has the ability to retain, at the Company's expense, special
legal, accounting, or other consultants or experts it deems necessary in
the performance of its duties.
II. ORGANIZATION
The Audit Committee shall comply with all rules and requirements of the New
York Stock Exchange (NYSE) and the Securities and Exchange Commission
(SEC). The Audit Committee shall be composed of three or more directors,
each of whom shall meet the independence and experience requirements of the
NYSE and the SEC. At least one member of the Audit Committee shall be a
financial expert as defined in the SEC rules. The Audit Committee shall be
appointed by the Board on recommendation of the Governance Committee.
Directors' fees are the only compensation an Audit Committee member may
receive from the Company.
The Audit Committee shall meet at least four times annually, or more
frequently as the Audit Committee may determine is appropriate. The Audit
Committee should meet separately at least quarterly with management, the
manager of internal auditing, the independent auditors and as an Audit
Committee to discuss any matters that the Audit Committee or each of these
groups believes should be discussed. The Audit Committee may delegate
duties and responsibilities to a subcommittee of its members.
19
III. DUTIES AND RESPONSIBILITIES
REVIEW PROCEDURES
1. Review and reassess the adequacy of this Charter at least annually.
Submit any proposed changes to the Board for approval and have the
document published in accordance with the NYSE and SEC rules and
regulations.
2. Review major proposed changes to the Company's auditing and accounting
principles and practices as recommended by the independent auditors,
internal auditors or management and as promulgated by the Financial
Accounting Standards Board, the SEC or other regulatory bodies.
3. Consider and review with the independent auditors and management the
adequacy of the Company's disclosure controls and procedures and
internal controls.
4. Review and discuss with management and the independent auditors the
Company's annual and quarterly financial statements prior to filing or
distribution, including the Company's disclosure under "Management's
Discussion and Analysis of Financial Condition and Results of
Operations". Discuss any items required to be communicated by the
independent auditors in accordance with SAS 61.
5. Review significant findings prepared by the independent auditors and
the internal auditing department together with management's responses.
6. Review and discuss with management and the independent auditors the
effect of regulatory and accounting initiatives as well as accruals,
reserves, estimates and off-balance sheet structures on the financial
statements.
7. Review and discuss with management and the independent auditors the
accounting policies that may be viewed as critical and any significant
changes in the accounting policies of the Company.
8. Review and discuss with management earnings press releases as well as
earnings guidance prior to their release.
INDEPENDENT AUDITORS
9. Recommend to the Board the retention or termination of the independent
auditors who are accountable to the Audit Committee and the Board and
pre-approve any significant non-auditor relationship with the
independent auditors.
10. Approve all fees to be paid to the independent auditors.
11. Review and discuss at least annually with the independent auditors a
written report setting forth (i) all relationships they have with the
Company that could impair the independent auditors independence; (ii)
the firm's internal quality-control procedures; (iii) any material
issues raised by the most recent internal quality-control review or
peer review of the firm or any inquiry or investigation by
governmental or professional
20
authorities within the preceding five years, respecting one or more
independent audits carried out by the firm and any steps taken to deal
with any such issue.
12. Review the independent auditors' audit plan -- discuss scope,
staffing, locations, reliance upon management and internal audit and
general audit approach.
13. Discuss the results of the audit with the independent auditors prior
to releasing the year-end earnings. Discuss certain matters required
to be communicated to the Audit Committee in accordance with SAS 61.
14. Review with the independent auditors any audit problems or
difficulties and management's response. Resolve disagreements between
the independent auditors and management regarding financial reporting.
15. Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in
its financial reporting.
INTERNAL AUDIT DEPARTMENT AND LEGAL COMPLIANCE
16. Review and approve annually the internal audit department's audit
plan.
17. Review the appointment, performance and replacement of the manager of
internal audit.
18. Review significant internal audit findings and recommendations.
19. Review with the Company's counsel, on at least a quarterly basis, any
legal matters that could have a significant impact on the
organization's financial statements.
OTHER AUDIT COMMITTEE RESPONSIBILITIES
20. Review with management tax reserves related to open tax years.
21. Annually prepare a report to shareholders as required by the SEC to be
included in the Company's annual proxy statement.
22. Review and discuss policies with respect to risk assessment and risk
management.
23. Review periodically the Company's Code of Business Conduct and Ethics
and ensure that management has established an appropriate system to
enforce this Code.
24. Establish and maintain procedures for the receipt, retention and
treatment of complaints received by the Company regarding accounting,
internal accounting control or auditing matters and the confidential,
anonymous submission by employees of concerns regarding questionable
accounting and auditing matters.
25. Annually perform a self-assessment of the Audit Committee's
performance.
26. Review financial and accounting personnel succession planning within
the Company.
21
27. Review periodically policies and procedures, as well as audit results,
associated with directors' and officers' expense accounts and
perquisites.
28. Review annually a summary of directors' and officers' related party
transactions and potential conflicts of interest.
29. Assess periodically, in executive session, management's effectiveness
and the performance of the internal audit department.
30. Approve all hiring of any current or former employees of the
independent auditors.
31. Review potential actions and other transactions to assess potential
conflict of interest of management or others involved in such action
or transactions.
32. Maintain minutes of meetings and report to the Board on significant
results of the foregoing activities.
33. Report all significant actions and findings to the Board.
34. Perform any other activities consistent with this Charter, the
Company's By-laws and governing law as the Audit Committee or the
Board deems necessary or appropriate.
22
GREAT PLAINS ENERGY INCORPORATED
P.O. Box 418679, Kansas City, Missouri 64141
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL
MEETING OF SHAREHOLDERS ON TUESDAY, MAY 6, 2003
The Board of Directors recommends a vote FOR Items 1 and 2.
The undersigned hereby appoints B. J. Beaudoin, A. F. Bielsker, and J. S. Latz,
and each or any of them, proxies for the undersigned with power of substitution,
to vote all the shares of common stock of Great Plains Energy Incorporated that
the undersigned is entitled to vote at the Annual Meeting of Shareholders to be
held on Tuesday, May 6, 2003, and any adjournment or postponement thereof, upon
the matters set forth on the reverse side, and in their discretion upon such
other matters as may properly come before the meeting.
This Proxy, if signed and returned, will be voted as directed on the reverse
side. If this card is signed and returned without direction, such shares will be
voted FOR the proposals.
- --------------------------------------------------------------------------------
Please sign exact1y as your name(s) appear(s) on the reverse side of this card.
If your shares are held jointly, any one of the joint owners may sign.
Attorneys-in-fact, executors, administrators, trustees, guardians or corporation
officers should indicate the capacity in which they are signing.
- --------------------------------------------------------------------------------
PLEASE NOTE ADDRESS CHANGES HERE
- ---------------------------------------------------
- ---------------------------------------------------
- ---------------------------------------------------
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
- FOLD AND DETACH HERE -
YOUR VOTE IS IMPORTANT!
IF YOU VOTE BY TELEPHONE OR THE INTERNET, DO NOT RETURN
YOUR PROXY CARD.
VOTE BY
TELEPHONE *** INTERNET *** MAIL
24 hours a day -- 7 days a week
TELEPHONE
1-800-758-6973 INTERNET
(TOLL FREE) http://www.eproxyvote.com/gxp MAIL
- - USE ANY TOUCH TONE TELEPHONE - GO TO THE WEBSITE ADDRESS - MARK, SIGN AND DATE THE
INDICATED ABOVE PROXY CARD ON THE REVERSE
SIDE
- - HAVE THIS PROXY CARD IN HAND - HAVE THIS PROXY CARD IN - DETACH THE PROXY CARD
HAND
- - ENTER THE CONTROL NUMBER LOCATED - ENTER THE CONTROL NUMBER - RETURN THE PROXY CARD IN
ON THE REVERSE SIDE OF THIS CARD LOCATED ON THE REVERSE THE POSTAGE-PAID ENVELOPE
WHEN PROMPTED SIDE OF THIS CARD PROVIDED
- - FOLLOW THE RECORDED INSTRUCTIONS - FOLLOW THE INSTRUCTIONS
ON THE SCREEN
PROXY CARD 2003 GXP
[X] PLEASE MARK VOTES
AS IN THIS EXAMPLE
- -----------------------------------
GREAT PLAINS ENERGY INCORPORATED
- -----------------------------------
The Board of Directors recommends a
vote FOR Items 1 and 2.
CONTROL NUMBER:
Please be sure to sign and date this Proxy. Date:
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
Shareholder signature Co-owner signature
For All
For Withhold Except
1. Election of Directors - Nominees [ ] [ ] [ ]
(01) B.J. Beaudoin (02) D.L. Bodde
(03) M.A. Ernst (04) R. C. Ferguson Jr.
(05) W.K. Hall (06) L.A. Jimenez
(07) J. A. Mitchell (08) W.C. Nelson
(09) L.H. Talbott (10) R.H. West
NOTE: IF YOU DO NOT WISH YOUR SHARES VOTED "FOR" A PARTICULAR NOMINEE, MARK
THE "FOR ALL EXCEPT" BOX AND STRIKE A LINE THROUGH THE NAME(s) OF THE
NOMINEE(s). YOUR SHARES WILL BE VOTED FOR THE REMAINING NOMINEE(s).
For Against Abstain
2. Appointment of Deloitte & Touche LLP as [ ] [ ] [ ]
independent auditors for 2003.
Mark the box at the right if your address has changed and note the [ ]
change(s) in the space provided on the reverse side of this card.
- FOLD AND DETACH HERE -
THANK YOU FOR VOTING!
GREAT PLAINS ENERGY INCORPORATED
Annual Meeting of Shareholders
May 6, 2003
10:00 a.m. Central Daylight Time
Discovery Center
4750 Troost
Kansas City, MO 64110
PROXY CARD 2003 GXP
