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GENERAL
Members of the Finance Committee (the “Committee”), including its Chairman, are selected by the Board of Directors (the “Board”) on at least an annual basis and the selections may be changed by the Board at any time.The Committee is responsible to the Board and reports regularly to the Board on the activities of the Committee. The Committee may create subcommittees and vest those subcommittees with the authority of the full Committee with respect to specific matters delegated to such subcommittees. FINANCE COMMITTEE DUTIES AND RESPONSIBILITIES - Review the historical and projected financial performance of Pinnacle West Capital Corporation and its subsidiaries (collectively, the “Company”).
- Review the Company's financial condition, including sources of liquidity and projected levels of indebtedness.
- Review and recommend approval of corporate short-term investment and borrowing policies.
- Review the Company's financing plan and recommend approval of the issuance (and redemption) of long-term debt, common equity and preferred securities, and the establishment of credit facilities; and review and recommend approval of the general parameters within which designated pricing committees or designated Officers of the Company may, pursuant to Board authority, establish terms and conditions relating to the issuance of long-term debt and equity securities.
- Review the Company’s use of guarantees, other forms of credit support and derivatives; the risk tolerances to be utilized in its financing activities; and its hedging policies.
- Review and monitor the Company's dividend policies and proposed dividend actionsand provide input to the Board as the Committee deems appropriate.
- Establish and select the members of the Investment Management Committee to oversee the investment programs of the Company’s trusts and benefit plans and receive periodic updates from the Investment Management Committee.
- Review and discuss with management the Company’s process for allocation and management of capital.
- Review and recommend approval of the Company's annual capital budget.
- Review the Company's annual operations and maintenance budget.
- Review reports from the Company regarding its treasury and energy trading operations, including reports regarding compliance with approved parameters.
- Review the Company’s insurance programs.
- Periodically review, with management, the principal risks relating to or arising out of the Company’s financial policies and practices and assess the effectiveness of the Company’s measures to address these risks.
- Conduct a self-assessment on at least an annual basis to determine whether the Committee is functioning effectively.
- Review the Committee’s Charter at least biennially, and, if appropriate, recommend changes to the Board.
MANAGEMENT'S RESPONSIBILITIES Provide the Committee with the necessary resources to discharge the Committee’s duties and responsibilities, as reflected in this Charter and asassigned to the Committee by the Board.
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