UNITED STATES DISTRICT COURT FOR THE DISTRICT OF KANSAS. Master File: JAR NOTICE OF CLASS ACTION SETTLEMENT

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1 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF KANSAS x : IN RE WESTAR ENERGY, INC. : ERISA LITIGATION : x Master File: JAR NOTICE OF CLASS ACTION SETTLEMENT Your legal rights might be affected if you are a member of the following class: ANY PERSON, EXCLUDING DEFENDANTS, WHO WAS A PARTICIPANT IN OR BENEFICIARY OF THE WESTAR ENERGY, INC. EMPLOYEES 401(K) SAVINGS PLAN (THE PLAN ) AT ANY TIME DURING THE PERIOD FROM JULY 1, 1998 THROUGH JANUARY 1, 2003 (THE CLASS PERIOD ) AND WHOSE ACCOUNT IN THE PLAN INCLUDED INVESTMENTS IN THE WESTAR ENERGY, INC. COMPANY STOCK FUND (THE SETTLEMENT CLASS ) PLEASE READ THIS NOTICE CAREFULLY. A FEDERAL COURT AUTHORIZED THIS NOTICE. THIS IS NOT A SOLICITATION. YOU HAVE NOT BEEN SUED. This notice ( Notice ) advises you of a proposed settlement (the Settlement ) of a consolidated class action lawsuit brought by plaintiffs Richard A. Toledo, Scott A. Hilderbrandt, Billy J. Williams, Randy J. Herman, Marsha Ericson, Donald L. Croucher, Marty J. Cummings, Jr., Maria A. Gonzalez, Larry Kampschroeder, Stephen Randel, George Ludwig, Mark A. Mueller, Steven M. Short, Thomas Engelken, Ronald J. Leiker, William Dale Renner, Robert L. Griffith, Robert W. Mackey, James A. Stanley, Thomas F. Hodges, Carl M. Joost, Paul E. Lira, James M. File, Sandra S. Cummings, Joe Zwiesler, Rosa M. Nicholson, and Harold J. Holmes (collectively, Named Plaintiffs ) on behalf of themselves and as representatives of the Settlement Class against defendants Westar Energy, Inc. (the Company ), the Investment and Benefits Committee, David C. Wittig, William B. Moore, Ira W. McKee, Jr., Carl M. Koupal, Jr., Richard D. Terrill, Bruce A. Akin, James A. Martin, Paul R. Geist, and Larry D. Irick (collectively, Defendants ), alleging that Defendants breached their fiduciary duties and violated the Employee Retirement Income Security Act of 1974 ( ERISA ). Named Plaintiffs and Defendants are referred to herein as the Parties. The Settlement will provide for a cash payment of $9,250,000 to the Plan and for a pro rata allocation of this payment to the accounts of members of the Settlement Class who had portions of their accounts invested in Company Stock in proportion to their loss in value of Company Stock during the Class Period. The Court in charge of this case still has to decide whether to approve the Settlement. Payments will be made only if the Court approves the Settlement and that approval is upheld in the event of any appeals. This process is explained in greater detail in this Notice. Identification of Key Terms: This Notice contains summary information with respect to the Settlement. The terms and conditions of the Settlement are set forth in a Class Action Settlement Agreement (the Settlement Agreement ). Capitalized and italicized terms used in this Notice, but not defined in this Notice, have the meanings assigned to them in the Settlement Agreement. The Settlement Agreement, and additional information with respect to this lawsuit and the Settlement, are available at Counsel for the Settlement Class, Schiffrin & Barroway LLP, 280 King of Prussia Road, Radnor, PA 19087, and Ralston, Pope & Diehl, LLC, 2913 S.W. Maupin Lane, Topeka, KS ( Appointed Counsel ), have established a toll-free phone number ( ) and address WestarERISAsettlement@sbclasslaw.com if you have questions. Reasons for the Settlement: The Settlement resolves claims against Defendants for allegedly breaching their fiduciary duties and violating ERISA. The Settlement is not, and should not be construed as, an admission of any fault, liability or wrongdoing whatsoever by any of the Defendants. The Named Plaintiffs and Appointed Counsel believe that the proposed Settlement is fair, reasonable, and adequate, and in the best interests of the Settlement Class. The Named Plaintiffs and Appointed Counsel believe that the Settlement provides a substantial benefit in the form of $9,250,000 (nine million, two hundred fifty thousand dollars) in cash (less various expenses described in this Notice), as compared to the risks and delays of proceeding with this litigation. Identification of Attorney s Representatives: Any questions regarding the Settlement should be directed to Appointed Counsel: Joseph H. Meltzer, Gerald D. Wells, III, Schiffrin & Barroway LLP, 280 King of Prussia Road, Radnor, PA 19087, ; Ronald Pope, Ralston, Pope & Diehl, LLC, 2913 S.W. Maupin Lane, Topeka, KS 66614, Please do not contact the Court or the Company. They will not be able to answer your questions.

2 ACTIONS YOU MAY TAKE IN THE SETTLEMENT NO ACTION IS NECESSARY TO RECEIVE PAYMENT. YOU CAN OBJECT NO LATER THAN JULY 13, YOU CAN GO TO THE HEARING ON JULY 27, 2006 by FILING A NOTICE OF INTENTION TO APPEAR NO LATER THAN JULY 13, If you are a member of the Settlement Class, you do not need do anything in order to receive a payment. You can write to the Court and explain why you do not like the Settlement. If you have submitted a written objection to the Court, you can ask to speak in Court about the fairness of the Settlement. This litigation, known as In re Westar ERISA Litigation, Master File No JAR, (the Action ) is a consolidated case in which Plaintiffs allege that the Defendants breached fiduciary duties they owed to the participants in and beneficiaries of the Plan. Copies of the Complaint and other documents filed in the Action are available at SUMMARY OF SETTLEMENT A Settlement Fund consisting of $9,250,000 million in cash, plus interest, will be established in the Action. The Settlement Fund (less the payment of approved expenses, attorneys fees and costs) will be paid to the Plan and allocated to Settlement Class members in accordance with the Plan of Allocation to be approved by the Court. As with any litigation, the Parties would face an uncertain outcome if the Action were to continue. Continued litigation of the Action against Defendants could result in a judgment or verdict greater or lesser than the recovery under the Settlement Agreement, or in no recovery at all. Moreover, this litigation has been hotly contested from the outset. Indeed, throughout this litigation, Named Plaintiffs and Defendants have disagreed on both liability and damages, and they do not agree on the amount that would be recoverable even if Plaintiffs were to prevail at trial. Defendants have denied and continue to deny the claims and contentions alleged by Named Plaintiffs, that they are liable at all to the Settlement Class, and that the Settlement Class or the Plan have suffered any damages for which Defendants could be held responsible. Nevertheless, the Parties have taken into account the uncertainty and risks inherent in this litigation, particularly its complex nature, and have concluded that it is desirable that the Action be fully and finally settled on the terms and conditions set forth in the Settlement Agreement. Why did I get this Notice package? 1. You or someone in your family are or may have been a participant in or beneficiary of the Plan and/or one of its predecessors who had a portion of his or her Plan account invested in the Company Stock Fund ( Westar Fund ). The Court has directed that this Notice be sent to you because, as a potential class member, you have a right to know about the proposed Settlement of this Action before the Court decides whether to approve the Settlement. If the Court approves the Settlement, and all objections and appeals are favorably resolved, the net amount of the Settlement Fund will be paid to the Plan and then allocated among Settlement Class members according to a court-approved Plan of Allocation. 2. The Court where this litigation is pending is the United States District Court for the District of Kansas. 3. This Notice explains the Action, the Settlement, your legal rights, what benefits are available, who is eligible for them, and how you will receive your portion of the benefits. The purpose of this Notice is to inform you of a hearing to be held by the Court to consider the fairness, reasonableness and adequacy of the proposed Settlement and to consider the application of Appointed Counsel s attorneys fees and reimbursement of expenses of litigation expenses (the Fairness Hearing ). 4. The Fairness Hearing. The Fairness Hearing will be held at 1:30 p.m. (C.D.T.) on JULY 27, 2006 before the Honorable Julie A. Robinson in the United States District Court for the District of Kansas, 405 United States Courthouse, 444 S.E. Quincy, Topeka, Kansas 66683, to determine: (a) Whether the proposed Settlement is fair, reasonable and adequate and should be approved by the Court; (b) Whether the claims against Defendants should be dismissed with prejudice as set forth in the Settlement Agreement; (c) Whether the application by Appointed Counsel for an award of attorneys fees and reimbursement of litigation expenses should be approved; and (d) Whether the application of each of the Named Plaintiffs for a Case Contribution Award of up to $1,000 (one thousand dollars) should be approved. 5. The issuance of this Notice is not an expression of the Court s opinion on the merits of any claim in the Action, and the Court still has to decide whether to approve the Settlement. If the Court approves the Settlement, payment to the Plan Trust will be made after all appeals, if any, are favorably resolved. It is always uncertain whether such appeals can be favorably resolved, and resolving them can take time, perhaps more than a year. Please be patient. 2

3 How do I know whether I am part of the Settlement? 6. The Court has certified the Action as a class action for purposes of this Settlement only. If you were a participant in or beneficiary of the Plan (or its predecessor), at any time between the period from July 1, 1998 through January 1, 2003, and your Plan account included investment in the Westar Fund (or its predecessor), then you are a member of the class covered by the Settlement. What does the Settlement provide? 7. A Settlement Fund consisting of $9.25 million in cash, plus interest, is being established in the Action. The net amount in the Settlement Fund, after payment of, and establishment of reserves for, any taxes and court-approved costs, attorney s fees, and expenses will be paid to the Plan and, after payment of implementation expenses, the remaining amount will be allocated to members of the Settlement Class according to a Plan of Allocation to be approved by the Court. Allocations will be made to the Plan accounts of members of the Settlement Class. Plan accounts may be created for those members of the Settlement Class who no longer have Plan accounts and who are entitled to an award under the Plan of Allocation. Disbursement of the Settlement Fund to the Settlement Class will occur once the Settlement has become Final once all appeals are favorably decided and all appeal periods have run. The above description of the operation of the Settlement is only a summary. The governing provisions are set forth in the Settlement Agreement (including its exhibits), which may be obtained at What will be my share of the Settlement Fund? 8. Your share of the Settlement Fund, if any, will be determined using a methodology that takes into account the value of your investment in the Westar Fund account at the beginning of the Class Period, the value of additional Westar Fund purchases (whether as a result of Company matching or from voluntarily deferred contributions), and the proceeds of Westar Fund sales or withdrawals. That methodology, called the Plan of Allocation, will be implemented by the Plan trustee based on the Plan records. The Court will be asked to approve the Plan of Allocation at the Fairness Hearing. The Plan of Allocation determines your settlement using three steps: A. Your Net Loss Is Calculated Your Net Loss, for the purpose of the allocation methodology, is the total of the dollar value of your holdings in the Westar Fund at the beginning of the Class Period (July 1, 1998) plus (+) the dollar value of units you purchased in the Westar Fund during the Class Period minus (-) the dollar value of units you sold or withdrew from the Westar Fund during the Class Period minus (-) the dollar value of your holdings in the Westar Fund at the end of the Class Period (January 1, 2003). B. Your Net Loss Percentage Is Calculated Your Net Loss Percentage will be determined by dividing your Net Loss by the total Net Loss of all Settlement Class Members. C. Your Share of the Net Settlement Amount Is Calculated Your Net Loss percentage will determine the dollar value of your share, if any, of the Net Settlement Amount. Your share will be your Net Loss Percentage multiplied by the Net Settlement Amount. But, no member of the Settlement Class who is entitled to a share or allocation of the Net Settlement Amount will receive less than $10. The Plan trustee or any third party vendor mutually agreed upon by the Parties will perform all calculations for you and determine both whether you are entitled to a share of the Net Settlement Amount and your share amount. The Plan trustee or any third party vendor mutually agreed upon by the Parties will have access to all Plan records so you need not be concerned if you no longer have personal statements. The Court will be asked to approve a more detailed statement of the Plan of Allocation, a copy of which is available along with other settlement documents at Defendants, to the extent they were participants or beneficiaries of the Plan at any time during the period from July 1, 1998 through January 1, 2003, will be excluded from the Plan of Allocation. What is the lawsuit about? What has happened so far? 9. Beginning on March 7, 2003, twenty-seven class actions under ERISA (the ERISA Actions ) were brought on behalf of a purported class of individuals who participated in the Plan, alleging breaches of fiduciary duties in violation of ERISA. By Order dated September 23, 2003, the ERISA Actions were consolidated under Master File No In the Consolidated Complaint dated October 22, 2003 (the Complaint ), Plaintiffs allege, among other things, that Defendants were fiduciaries of the Plan and violated fiduciary duties under ERISA by causing the Plan to offer, purchase and hold units of the Company Stock at a time, when according to Plaintiffs, the Westar Fund was allegedly an unsuitable and imprudent investment for the Plan. Plaintiffs further allege that Defendants violated ERISA by misrepresenting to Plaintiffs and Plan participants the true financial condition of the Company and, consequently, the true value of the Westar Fund. Plaintiffs sought to recover from Defendants losses to the Plan caused by Defendants alleged misconduct. 3

4 11. On December 22, 2003, Defendants filed motions to dismiss the Complaint. The motions to dismiss were fully briefed. On September 29, 2005, the Court issued a ruling granting in part and denying in part Defendants motions to dismiss. 12. Appointed Counsel and counsel for Defendants have reached an agreement to settle the Action on terms that are summarized herein. Named Plaintiffs and Defendants, through their counsel, have conducted an extensive investigation of the allegations in the Action and evaluated its merits. Further, the Parties, also with the assistance of counsel and an independent mediator, have engaged in substantial arm s length negotiations in an effort to resolve all claims that have been or could have been asserted in the Action. Appointed Counsel and counsel for Defendants have conducted numerous meetings and conferences in which the terms of the Settlement detailed herein were extensively debated and negotiated. Why is this case a class action? 13. In a Class action, one or more plaintiffs, called Named Plaintiffs, sue on behalf of people who have similar claims. All of the individuals on whose behalf the Named Plaintiffs are suing are Class Members, and they are also referred to herein as members of the Settlement Class. The Court resolves the issues for all Class Members. U.S. District Judge Julie A. Robinson is presiding over this case. Why is there a Settlement? 14. Under the proposed Settlement, the Court will not decide the merits of the Action in favor of either Plaintiffs or Defendants. By agreeing to a Settlement, both Plaintiffs and Defendants avoid the costs and risks of litigating the Action. 15. This Settlement is the product of extensive negotiations between Appointed Counsel and the Defendants counsel, including the services of an experienced mediator. Throughout the settlement negotiations, the Plaintiffs and the Defendants were advised by various consultants and experts, including individuals with expertise in ERISA fiduciary liability issues, insurance coverage issues, and estimating potential damages in cases involving ERISA fiduciary liability. 16. Appointed Counsel believe that the proposed Settlement is fair, reasonable and adequate and in the best interest of the Settlement Class. How can I get my portion of the recovery? 17. Members of the Settlement Class do not need to file a claim for recovery in this Action. Members of the Settlement Class who are current Plan participants and are authorized to receive a recovery will have their Settlement proceeds deposited in their Plan account. A Plan account will be established for any member of the Settlement Class who no longer participates in the Plan. Any such members of the Settlement Class will receive notification of the creation of such account or forwarding along with further instructions regarding how a distribution can be received. Any questions regarding the distribution of the Settlement Fund can be directed to or WestarERISAsettlement@sbclasslaw.com. When would I get my payment? 18. Payment is conditioned on several matters, including the Court s approval of the Settlement and such approval becoming Final and no longer subject to any appeals to any court. Upon satisfaction of various conditions, the Net Settlement Amount will be paid to the Plan and allocated to the accounts of Settlement Class members pursuant to the Plan of Allocation (described in 8 above) as soon as possible after final approval has been obtained for the Settlement (which includes exhaustion of any appeals). Any appeal of the final approval could take several years. Any accrued interest on the Settlement Fund will be included in the amount paid to the Plan and allocated to the Plan accounts of Settlement Class members. The Settlement Agreement may be terminated on several grounds, including if the Court does not approve or modifies the Settlement. Should the Settlement Agreement be terminated, the Settlement will be terminated, and the Action will proceed as if the Settlement had not been reached. What rights am I giving up in the Settlement? 19. If the Settlement is approved, the Court will enter a judgment. This judgment will (i) dismiss the claims against Defendants with prejudice; and (ii) provide that each of the Named Plaintiffs and all other members of the Settlement Class, on behalf of themselves and their respective heirs, executors, administrators, successors and assigns and all persons acting in concert with any such person, shall, with respect to each and every Released Claim (as defined below in 20), waive, release, forever discharge and dismiss and agree not to institute, maintain or prosecute any or all Released Claims against any or all of the Releasees (as defined in the Settlement Agreement) and shall be permanently and finally enjoined without the necessity of posting a bond from commencing or prosecuting any actions or other proceedings asserting any of the Released Claims, either directly, indirectly, representatively, derivatively or in any other capacity, against any of the Releasees herein. This injunction expressly extends to all claims covered by the Settlement Agreement and all members of the Settlement Class. 20. The Released Claims shall be: any and all claims of any nature whatsoever (including claims for any and all losses, damages, unjust enrichment, attorneys fees, disgorgement of fees, litigation costs, injunction, declaration, contribution, indemnification or any other type or nature of legal or equitable relief), whether accrued or not, whether known, unknown, or unsuspected, in law or equity, as well as any claim or right obtained by assignment, brought by way of demand, complaint, cross-claim, counterclaim, third-party claim or otherwise (collectively, Claims ), arising out of or in any way related to, directly or indirectly, any or all of the acts, omissions, facts, matters, transactions or occurrences: (A) during the Class Period that are, were or could have been alleged, asserted, or set forth in the 4

5 Complaint; or (B) concerning the calculation of amounts to be distributed to members of the Settlement Class and/or the allocation or distribution of the Net Proceeds of the Settlement Fund to members of the Settlement Class, except that such release shall run in favor of those Persons actually undertaking the calculation, distribution and/or allocation, only provided that such calculations, distributions, or allocations are performed in good faith. Can I exclude myself from the Settlement? 21. You do not have the right to exclude yourself from the Settlement. For settlement purposes, the Action was certified under Federal Rule of Civil Procedure 23(b)(1) because the Court determined the requirements of the rules were satisfied. Thus, it is not possible for any Settlement Class members to exclude themselves from the Settlement. As a member of the Settlement Class, you will be bound by any judgments or orders that are entered in the Action for all claims that were or could have been asserted in the Action or are otherwise included in the release under the Settlement. 22. Although members of the Settlement Class cannot opt out of the Settlement, they can object to the Settlement and ask the Court not to approve the Settlement. See 26. Do I have a lawyer in the case? 23. The Court has appointed the law firms of Schiffrin & Barroway, LLP, and Ralston, Pope & Diehl, LLC as Appointed Counsel for Named Plaintiffs and the Settlement Class. You will not be charged directly by these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense. How will the lawyers be paid? 24. At the Fairness Hearing, Appointed Counsel will apply for an award of attorneys fees and expenses on behalf of all Plaintiffs counsel. The application for attorneys fees will not exceed 30% of the Settlement Fund. 25. To date, neither Appointed Counsel nor any of Plaintiffs counsel have received any payment for their services in prosecuting this Action on behalf of the Settlement Class, nor have counsel been reimbursed for their out-of-pocket expenses. The fee requested by Appointed Counsel would compensate all of Plaintiffs counsel for their efforts in achieving the Settlement for the benefit of the Settlement Class and for their risk in undertaking this representation on a contingency basis. The Court will determine the actual amount of the award. As stated above, you can tell the Court that you do not agree with all or any portion of the Settlement. How do I tell the Court that I don t like the Settlement? 26. Any member of the Settlement Class may appear at the Fairness Hearing and show cause why Settlement of the Action embodied in the Settlement Agreement should not be approved as fair, reasonable and adequate and why a judgment should not be entered thereon, or why the attorneys fees and expenses should not be awarded; provided, however, that no member of the Settlement Class shall be heard or entitled to contest the approval of the terms and conditions of the proposed Settlement and the judgment to be entered approving the same unless such Settlement Class Member has filed with the Court written objections (which state all supporting bases and reasons for the objection, set forth proof of their membership in the Settlement Class, clearly identify any and all witnesses, documents and other evidence of any kind that are to be presented at the Fairness Hearing in connection with such objections, and further describe the substance of any testimony to be given by themselves as well as by any supporting witnesses). 27. To object, you must send a letter or other written statement saying that you object to the Settlement in In re Westar ERISA Litigation, No. 03-CV-4032-JAR. Be sure to include your name, address, telephone number, signature, and a full explanation of all reasons you object to the Settlement. Your written objection must be filed with the Court, and mailed to the counsel listed below, postmarked (and sent via facsimile) by no later than JULY 13, 2006: Filed with the Clerk of the Court: Clerk of the Court United States District Court for the District of Kansas 444 S.E. Quincy 490 U.S. Courthouse Topeka, Kansas and, by the same date, has served copies of all such papers by mail and faxed to each of the following: Joseph H. Meltzer Gerald D. Wells, III SCHIFFRIN & BARROWAY, LLP 280 King of Prussia Road Radnor, PA Facsimile: Lead Counsel for Plaintiffs 5

6 Sharon Katz DAVIS POLK & WARDWELL 450 Lexington Avenue New York, NY Facsimile: Counsel for Defendants Westar Energy, Inc. and the Investment and Benefits Committee UNLESS OTHERWISE ORDERED BY THE COURT, ANY SETTLEMENT CLASS MEMBER WHO DOES NOT OBJECT IN THE MANNER DESCRIBED HEREIN WILL BE DEEMED TO HAVE WAIVED ANY OBJECTION AND SHALL BE FOREVER FORECLOSED FROM MAKING ANY OBJECTION TO THE PROPOSED SETTLEMENT AND THE APPLICATION FOR ATTORNEYS FEES AND EXPENSES. When and where will the Court decide whether to approve the Settlement? 28. The Court will hold a Fairness Hearing at 1:30 p.m. (C.D.T.) on JULY 27, 2006, at the United States District Court for the District of Kansas, United States District Court for the District of Kansas, 444 S.E. Quincy, 490 U.S. Courthouse, Topeka, Kansas IF YOU DO NOT WISH TO OBJECT TO THE PROPOSED SETTLEMENT OR THE APPLICATION FOR ATTORNEYS FEES AND EXPENSES, YOU NEED NOT ATTEND THE FAIRNESS HEARING. 29. At the hearing, the Court will consider whether the Settlement is fair, reasonable, and adequate. If there are objections, the Court will consider them. After the Fairness Hearing, the Court will decide whether to approve the Settlement. The Court will also rule on the motions for attorneys fees and expenses. We do not know how long these decisions will take. 30. Appointed Counsel will answer questions Judge Robinson might have. You are welcome to come at your own expense. If you send an objection, you do not have to come to Court to talk about it. As long as you mailed your written objection on time, it will be before the Court when the Court considers whether to approve the Settlement as fair, reasonable and adequate. You may also have your own lawyer attend the Fairness Hearing at your expense, but such attendance is not necessary. 31. If you are a Class member, you may ask the Court for permission to speak at the Fairness Hearing. To do so, you must send a letter or other paper called a Notice of Intention to Appear at Fairness Hearing in In re Westar Energy, Inc. ERISA Litigation, No JAR. Be sure to include your name, address, telephone number, and your signature. Your Notice of Intention to Appear must be served on the attorneys listed in 27, postmarked and sent via facsimile no later than JULY 13, 2006, and must be filed with the Clerk of the Court at the address listed in 27, postmarked no later than JULY 13, The Fairness Hearing may be delayed by the Court without further notice to the Settlement Class. If you wish to attend the Fairness Hearing, you should confirm the date and time with Appointed Counsel. What happens if I do nothing all? 33. If you do nothing and you are a Class member, you will participate in the Settlement of the Action as described above in this Notice if the Settlement is approved. How do I get more information? 34. This Notice summarizes the proposed Settlement. The complete Settlement is set forth in the Settlement Agreement. You may obtain a copy of the Settlement Agreement by making a written request to Appointed Counsel listed on page 2. Copies of the Settlement Agreement, as well as the Preliminary Motion, seeking preliminary approval of the Settlement Agreement, and the Preliminary Approval Order, may also be obtained at Plaintiffs Appointed Counsel also have established a toll-free phone number to receive your comments and questions: , and may also be contacted via at: WestarERISAsettlement@sbclasslaw.com. 6