2024-08-09T12:21:51-05:00 2023-09-30 135565207 KPMG LLP 8350 BROAD ST SUITE 900 MCLEAN VA 22102 990 2022-10-01 133786524 UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND UKRA 3129397003 175 WEST JACKSON BLVD STE 1640 CHICAGO IL 60604 JAROSLAWA Z JOHNSON PRESIDENT & CEO 3129397003 2024-08-09 1 1 BRIAN KEARNS P02061479 7032868399 2024-07-24 2022 2024-08-08 14:25:15Z X JAROSLAWA Z JOHNSON 175 WEST JACKSON BLVD STE 1640 CHICAGO IL 60604 136706964 0 X WWW.UMAEF.ORG X 1994 IL UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND WAS CREATED AND FUNDED BY THE US (SEE SCHEDULE O) 7 6 2 0 0 0 0 134380106 40031 2277019 -1013093 -2192125 36415 36409 -936647 134501409 1742325 3242620 0 0 1982220 2470706 0 0 0 1750375 2059216 5474920 7772542 -6411567 126728867 83458676 224102151 416459 537842 83042217 223564309 X SEE SCHEDULE O 0 0 6526144 3242620 5811 USAID APPROVED THE LAUNCH OF A $30 MILLION LEGACY PROGRAM FUNDED BY A PORTION OF THE PROFITS EARNED FROM INVESTMENT ACTIVITIES. THE PROGRAM FOCUSES ON EXPORT PROMOTION, LOCAL ECONOMIC DEVELOPMENT, IMPACT INVESTMENT AND ECONOMIC LEADERSHIP. IN APRIL 2016, USAID APPROVED I) EXPANDING THE LEGACY PROGRAM TO $35 MILLION; II) $5 MILLION EARMARKED FOR DIRECT INVESTMENTS IN SMES, PRIMARILY START-UPS; AND III) A $30 MILLION COMMITMENT TO EMERGING EUROPE GROWTH FUND III, L.P. A FUND LAUNCHED BY HORIZON CAPITAL AND FOCUSED ON PROVIDING FINANCING TO SMES IN UKRAINE AND MOLDOVA. IN JANUARY 2023, UMAEF RECEIVED NEW FUNDING OF $134 MILLION IN FORM OF DEBT SECURITIES AND CASH TRANSFERRED FROM THE U.S. RUSSIA INVESTMENT FUND (TUSRIF) IN PARTNERSHIP WITH THE U.S. CONGRESS VIA USAID. IN SEPTEMBER 2023, USAID APPROVED USING THE TUSRIF FUNDS FOR SUPPORTING THE CREATION, RECOVERY AND EXPANSION OF SME AND ECONOMIC DEVELOPMENT IN UKRAINE AND MOLDOVA IN THE HIGH LEVEL PROGRAMMATIC AREAS AS DIRECT INVESTMENT AND SME DEVELOPMENT, IMPACT INVESTING, LOCAL ECONOMIC DEVELOPMENT, ENTREPRENEURSHIP, EDUCATION AND INNOVATION AND U.VENTURES. 760694 65653 UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND ENCOURAGES, THROUGH LENDING, INVESTMENT, AND TECHNICAL ASSISTANCE, THE CREATION AND EXPANSION OF SMALL AND MEDIUM-SIZED ENTERPRISES IN THE UKRAINE AND MOLDOVA. UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND ALSO FULFILLS ITS MISSION OF ATTRACTING ADDITIONAL PRIVATE CAPITAL TO THE REGION THROUGH ITS USAID-APPROVED ROLE AS A SPONSOR OF THE EMERGING EUROPE GROWTH FUND, LP, A PRIVATE EQUITY FUND LAUNCHED IN 2006 AND EMERGING EUROPE GROWTH FUND III, LP("EEGF III"), A PRIVATE EQUITY FUND LAUNCHED IN 2017.IN AUGUST 2022, BASED ON APPROVAL OF THE BOARD OF DIRECTORS, UMAEF BECAME AN INVESTOR OF HCGF IV, A PRIVATE EQUITY FUND LAUNCHED BY HORIZON CAPITAL, WITH $10 MILLION COMMITMENT AT ITS FIRST CLOSING. 7286838 1 1 0 0 0 0 0 0 0 0 1 0 1 0 1 1 1 0 0 1 1 1 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 1 1 7 0 1 2 1 0 1 UP MD UK 0 0 0 0 0 0 0 0 0 0 X 7 6 1 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 1 1 1 IL X NATALIA KOVALENKO 3129397003 175 WEST JACKSON BLVD STE 1640 CHICAGO IL 60604 X JAROSLAWA ZELINSKY JOHNSON PRESIDENT & CEO 40.00 0.00 X X 194878 0 37671 MARTA FARION DIRECTOR 1.00 0.00 X 0 0 0 JOHN E HERBST DIRECTOR 1.00 0.00 X 0 0 0 DENNIS A JOHNSON DIRECTOR 1.00 0.00 X 0 0 0 JEFFREY C NEAL DIRECTOR 1.00 0.00 X 0 0 0 DANIEL F RUNDE DIRECTOR 1.00 0.00 X 0 0 0 MARGOT ELLIS DIRECTOR 1.00 0.00 X 0 0 0 ELAINE MCCORMACK SECRETARY 36.00 0.00 X 82976 0 19057 LENNA KOSZARNY EXECUTIVE VICE PRESIDENT 1.00 0.00 X 0 0 0 NATALIA KOVALENKO CFAO & TREASURER 1.00 0.00 X 0 0 0 IRYNA OZYMOK LOCAL ECONOMIC DEVLOPMENT DIRECTOR 40.00 0.00 X 102400 0 0 ROMAN TYCHKIVSKYY STRATEGIC INITATIVES DIRECTOR 40.00 0.00 X 103700 0 0 483954 0 56728 3 0 1 0 HORIZON CAPITAL ASSOCIATES LLC 175 W JACKSON BLVD STE 1640 CHICAGO IL 60604 INVESTMENT/PRG MGMT FEES 618028 TATARSKY ROMAN PETER IE FL 4 20 MYKHAILIVSKYI LANE KYIV UP HOTEL SERVICE 411029 PR PARTNERS (EPIC BROKERS) 600 E 96TH ST SUITE 400 INDIANAPOLIS IN 46240 INSURANCE 125457 3 134380106 131268000 134380106 INTEREST FROM PRIS 523000 2277019 2277019 2277019 13430 13430 2205555 -2205555 -2205555 -2205555 MISCELLANEOUS 900099 36409 36409 36409 134501409 71464 0 49839 3242620 3242620 431316 352607 78709 863084 863084 982032 872237 109795 58910 58910 52491 45615 6876 82873 72017 10856 101045 88217 12828 311728 272152 39576 394 344 50 44819 33614 11205 13015 9761 3254 131047 98285 32762 647697 573497 74200 10000 7500 2500 386609 386609 7260 5566 1694 132772 99579 33193 OTHER OPERATING EXPENSE 257193 192895 64298 BANK FEES 8838 6629 2209 MEMBERSHIP FEES 6724 5044 1680 FIXED ASSET EXPENSES 75 56 19 7772542 7286838 485704 0 30786406 26202040 294247 320961 201407 175741 21424 25666 51730406 197147548 626193 405936 83458676 224102151 194794 309209 221665 228633 416459 537842 X 83042217 223564309 83042217 223564309 83458676 224102151 X 126728867 13783347 9878 X 0 1 X 1 0 X 110020 134380106 134490126 157330 298507 101428 40031 2277019 2874315 157330 298507 211448 40031 136657125 137364441 0 0 0 137364441 55 55 55 69 13430 13664 55 55 55 69 13430 13664 36000 36000 36201 36415 36409 181025 193385 334562 247704 76515 136706964 137559130 0.99860 0.84770 0.00010 0.00020 X PART III, SECTION B, LINE 12 OTHER INCOME OTHER INCOME CONSISTS OF EXPENSE REIMBURSEMENT AND OTHER MISCELLANEOUS INCOME. RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 4646 4646 0 196761 171095 25666 25666 EQUITY & DEBT SECURITIES 135749922 F OTHER FINANCIAL ASSETS 1410000 F EMERGING EUR. GROWTH FUND III 58565687 F HORIZON CAPITAL GROWTH FUND IV 1421939 F 197147548 THIRD-PARTY FRAMEWORK AGREEMENT 228169 EXIT-BASED INCENTATIVE PAYABLE 464 228633 X 148284756 13783347 13783347 134501409 0 134501409 7762664 0 7762664 9878 9878 7772542 PART X, LINE 2: TAX STATUS HISTORICALLY, THE FUND HAS BEEN EXEMPT FROM FEDERAL INCOME TAXES UNDER SECTION 501(C)(3) OF THE U.S. INTERNAL REVENUE CODE (THE CODE), AND, BECAUSE IT WAS FUNDED THROUGH U.S. GOVERNMENT GRANTS, HAS BEEN CLASSIFIED AS AN ORGANIZATION THAT IS NOT A PRIVATE FOUNDATION AS DEFINED IN SECTION 509(A)(1) OF THE CODE. THE FUND CHANGED ITS CLASSIFICATION DURING 2010 FROM AN ORGANIZATION THAT IS NOT A PRIVATE FOUNDATION UNDER SECTION 509(A)(1) TO A PUBLIC CHARITY AS DEFINED IN SECTION 509(A)(2) OF THE CODE, GIVEN THAT ITS INCOME IS NO LONGER DERIVED PRIMARILY FROM GRANTS. THE FUND CONTINUES TO MAINTAIN ITS 501(C)(3) DESIGNATION AND IS EXEMPT FROM PAYMENT OF STATE AND LOCAL INCOME TAXES. THE FUND IS REGISTERED AS A CHARITABLE TRUST IN ILLINOIS. PART XII, LINE 4B - OTHER ADJUSTMENTS: DEFERRED EXIT-BASED INCENTIVE 9,878. 1 RUSSIA AND NEIGHBORING STATES 2 14 PROGRAM SERVICES GENERAL OPERATIONS 3402087 RUSSIA AND NEIGHBORING STATES 0 0 GRANTMAKING/SCHOLARSHIPS 3242640 RUSSIA AND NEIGHBORING STATES 0 0 INVESTMENTS 9078211 2 14 0 0 2 14 15722938 0 15722938 RUSSIA AND NEIGHBORING STATES LEADERSHIP ACADEMY 1086490 WIRE 0 RUSSIA AND NEIGHBORING STATES VETERANS REHABILITATION 500000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 252140 WIRE 0 RUSSIA AND NEIGHBORING STATES INCLUSIVE SPACES AND PROGRAMS 175028 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 161294 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 142750 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 134700 WIRE 0 RUSSIA AND NEIGHBORING STATES ADVISORY ASSISTANCE TO SMES IN LVIV REGION 87824 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 76867 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 75000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 70000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 62560 WIRE 0 RUSSIA AND NEIGHBORING STATES SUPPORT FOR ORG OF EVENTS 59600 WIRE 0 RUSSIA AND NEIGHBORING STATES EXPORT PROMOTION 50000 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 50000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 48707 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 46066 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 42921 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 20289 WIRE 0 RUSSIA AND NEIGHBORING STATES TECHNICAL ASSISTANCE 12500 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 29774 WIRE 0 RUSSIA AND NEIGHBORING STATES EXPORT PROMOTION 18582 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 10000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 10000 WIRE 0 RUSSIA AND NEIGHBORING STATES EDUCATION 9082 WIRE 0 RUSSIA AND NEIGHBORING STATES CITIES PROMOTION 7951 WIRE 0 0 26 1 0 1 0 1 0 PART I, LINE 2: GRANT MONITORING REGULAR AND RIGOROUS REVIEW IS CONDUCTED BY UMAEF TO DETERMINE PROGRESS AND ASSESS WHETHER VALUE FOR MONEY HAS BEEN ACHIEVED. THIS INCLUDES REGULAR PROGRESS REPORTS BY THE FUNDING RECIPIENT AGAINST AGREED PERFORMANCE MEASURES OR MILESTONES AND/OR SITE VISITS BY A UMAEF PROGRAM MANAGER. PERFORMANCE MEASURES ARE DEVELOPED IN THE PLANNING PHASE OF A PROJECT AND USED FOR MONITORING DURING THE LIFE CYCLE OF THE GRANT AND TO EVALUATE THE PROJECT AS A WHOLE. RECIPIENT ORGANIZATIONS ARE REQUIRED TO SUBMIT TO UMAEF WRITTEN INTERIM AND/OR FINAL REPORTS TO REFLECT THE PROGRESS ON ACTIVITIES AND PROJECT'S RESULTS AND IMPACT TO DATE. UMAEF SPELLS OUT THE FREQUENCY AND INFORMATION TO BE INCLUDED IN THE REPORT. RECIPIENT ORGANIZATIONS ARE REQUIRED TO MAINTAIN NECESSARY FINANCIAL AND OPERATIONAL RECORDS IN RELATION TO THE OPERATION OF THE PROJECT AND TO SUBMIT TO UMAEF A FINANCIAL REPORT FOR USE OF FUNDS TO DETERMINE EXPENDITURE AGAINST THE FUNDING AGREEMENT. PART I, LINE 3: FOREIGN ACTIVITIES UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND HAS AN OFFICE IN THE U.S., BUT MOST OF ITS OPERATIONS ARE IN UKRAINE AND MOLDOVA, GIVEN ITS TAX-EXEMPT MISSION. (SEE SCHEDULE O FOR ADDITIONAL DETAILS.) UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND HAS ONE OFFICE IN UKRAINE AND ONE IN MOLDOVA. PART I, LINE 3, COLUMN (F) ACCOUNTING METHOD PROGRAM SERVICE EXPENDITURES INCLUDE DIRECT EXPENSES RECORDED USING THE ACCRUAL BASIS DURING FISCAL YEAR 2023. NO INDIRECT EXPENSE ALLOCATIONS HAVE BEEN MADE. PART III ACCOUNTING METHOD: X 1 1 X 0 0 0 0 0 0 0 0 0 JAROSLAWA ZELINSKY JOHNSON PRESIDENT & CEO 150000 0 0 0 44878 0 37671 0 0 0 232549 0 0 0 PART I, LINE 1A A HOUSING ALLOWANCE IS PROVIDED TO THE PRESIDENT/CEO. THIS ALLOWANCE IS TREATED AS TAXABLE COMPENSATION. HORIZON CAPITAL ASSOCIATES LLC MGMT OVERLAP-SCH O 525000 PROGRAM MGMT 0 HORIZON CAPITAL ASSOCIATES LLC MGMT OVERLAP-SCH O 102904 INVEST MGMT 0 BUSINESS TRANSACTIONS WITH INTERESTED PERSONS SCHEDULE L, PART IV - DURING THE YEAR ENDED SEPTEMBER 30, 2023, LENNA KOSZARNY (OFFICER) WAS OWNER AND/OR OFFICER OF HORIZON CAPITAL ASSOCIATES LLC (HCA), THE INVESTMENT MANAGEMENT COMPANY CONTRACTED TO MANAGE THE UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND PORTFOLIO. AS NOTED IN PART III OF FORM 990, ONE OF UKRAINE-MOLODVA AMERICAN ENTERPRISE FUNDS' KEY ACCOMPLISHMENTS WAS FULFILLING THE DIRECTIVE FROM USAID TO ENABLE THE ESTABLISHMENT OF A PRIVATE SUCCESSOR FUND, EMERGING EUROPE GROWTH FUND LP (EEGF). A NEW PRIVATE INVESTMENT MANAGEMENT COMPANY, HORIZON CAPITAL ASSOCIATES LLC (HCA), WAS FORMED TO SUPPORT EEGF AND UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND. THIS APPROACH FOLLOWED THE PRECEDENT OF USAID-FINANCED ENTERPRISE FUNDS IN CENTRAL AND EASTERN EUROPE, WHICH SUCCESSFULLY ATTRACTED SIGNIFICANT PRIVATE CAPITAL. THE FOUNDING OF EEGF WAS A SIGNIFICANT ACCOMPLISHMENT TOWARDS FULFILLING UKRIANE-MOLODVA AMERICAN ENTERPRISE FUNDS' MISSION. THE INVESTMENT MANAGEMENT AGREEMENT WITH HCA WAS ENTERED INTO BY UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND ON PARI PASSU TERMS AS THE THIRD-PARTY INVESTMENT MANAGEMENT AGREEMENT BETWEEN HCA AND EMERGING EUROPE GROWTH FUND, LP TO ENSURE THAT THE UMAEF-HCA INVESTMENT MANAGEMENT AGREEMENT WAS IN LINE WITH MARKET TERMS. IN AUGUST 2022, THE BOARD OF DIRECTORS APPROVED A COMMITMENT OF $10 MILLION TO HORIZON CAPITAL GROWTH FUND IV, L.P. ("HCGF IV") AT ITS FIRST CLOSING, AT PARI-PASSU TERMS WITH THIRD PARTY INVESTORS, THUS HELPING TO CATALYZE $105 MILLION OF CAPITAL FROM DEVELOPMENT FINANCIAL INSTITUTIONS ("DFIS"). THE FUND ENTERED INTO SUBSCRIPTION DOCUMENTS FOR HCGF IV AS OF SEPTEMBER 26, 2022, THUS COMMITTING $10 MILLION TO HCGF IV IN A FIRST CLOSING TOTALING $125 MILLION. AS OF SEPTEMBER 30, 2023, UMAEF MADE CONTRIBUTIONS TO HCGF IV IN THE AMOUNT OF $1.4 MILLION. HCGF IV HAS BEEN FINALLY CLOSED WITH TOTAL COMMITMENTS OF $328 MILLION.UNDER THE TERMS OF THE GRANT AGREEMENT WITH USAID, UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND IS MANAGED BY A BOARD OF DIRECTORS COMPRISED OF PRIVATE CITIZENS (A MAJORITY OF WHOM MUST BE U.S. CITIZENS), WHO HAVE DEMONSTRATED EXPERIENCE AND EXPERTISE IN THOSE AREAS OF PRIVATE SECTOR DEVELOPMENT IN WHICH THE FUND IS INVOLVED. THE INITIAL MEMBERS WERE ELECTED WITH ADVICE OF THE PRESIDENT OF THE UNITED STATES OR THE PRESIDENT'S DESIGNEE, AND NEW MEMBERS ARE RECOMMENDED BY CURRENT BOARD MEMBERS TO USAID WHO MUST OBTAIN SUBSEQUENT APPROVAL FROM PRESIDENTIAL ADMINISTRATION PRIOR TO THE NEW MEMBERS' COMMENCING BOARD PARTICIPATION. RE-ELECTION OF ANY CURRENT DIRECTOR ALSO REQUIRES APPROVAL FROM BOTH, USAID AND PRESIDENTIAL ADMINISTRATION. FOLLOWING THE FOUNDING OF EEGF, ALL EMPLOYEES OF UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND (EXCEPT THOSE LOCATED IN THE U.S.) BECAME EMPLOYEES OF HCA'S WHOLLY-OWNED SUBSIDIARY, HORIZON CAPITAL ADVISORS, LLC (HCAD), RESULTING IN THE TRANSFER OF EMPLOYEE COMPENSATION, OPERATING AND OTHER EXPENSES FROM UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND TO HCAD. HOWEVER, DURING 2015, AS A RESULT OF THE LAUNCH OF THE LEGACY PROGRAMS AND NEED TO HIRE COMMITTED RESOURCES TO MANAGE THESE PROGRAMS, THE FUND RECOMMENCED HIRING OF EMPLOYEES DIRECTLY, BEGINNING WITH THE PRESIDENT AND CHIEF EXECUTIVE OFFICER, PROGRAM MANAGERS AS WELL AS CERTAIN FULL-TIME SUPPORT PERSONNEL. THE FUND CONTINUES ITS PRACTICE OF NOT HIRING ANY INVESTMENT PERSONNEL AS THE INVESTMENT MANAGEMENT FUNCTION IS DELEGATED TO HCA ON THE BASIS OF THE UMAEF-HCA INVESTMENT MANAGEMENT AGREEMENT. IN FEBRUARY 2015, THE FUND ALSO ENTERED INTO A SHARED SERVICES AGREEMENT WITH HCA, APPROVED BY THE BOARD OF DIRECTORS, TO PROVIDE SUPPORT TO THE FUND IN THE FORM OF ADDITIONAL PROGRAM MANAGEMENT AND ADMINISTRATIVE SERVICES FOR LEGACY PROGRAMS. THIS AGREEMENT PROVIDES THE FUND WITH ACCESS TO A FULL RANGE OF HCAD HR, LEGAL, ADMINISTRATIVE, COMMUNICATIONS, MGMT AND OTHER RESOURCES RATHER THAN EXPEND SIGNIFICANT TIME, COST AND EFFORT TO SET-UP THESE RESOURCES IN-HOUSE. X 1 131268000 MARKET VALUE 0 0 0 PART I, COLUMN (B): THIS COLUMN REPRESENTS THE NUMBER OF CONTRIBUTIONS, NOT THE NUMBER OF ITEMS RECEIVED. FORM 990, PART I, LINE 1 UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND WAS CREATED AND FUNDED BY THE U.S. CONGRESS, TO INVEST IN AND ATTRACT PRIVATE CAPITAL TO UKRAINE, MOLDOVA, AND BELARUS, TO PROMOTE ENTREPRENEURSHIP AND OPEN MARKETS. FORM 990, PART III, LINE 1 NAME CHANGE: SUBSEQUENT TO THE YEAR-END, BASED ON THE APPROVAL BY THE BOARD OF DIRECTORS, THE FUND HAS INITIATED THE PROCESS OF CHANGING ITS LEGAL NAME INTO UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND. THIS CHANGE WAS RECORDED IN THE DELAWARE SECRETARY OF STATE'S CERTIFICATE ISSUED IN OCTOBER 2023. THE NEW NAME WILL REFLECT THE FUND'S ACTUAL HISTORICAL AND ONGOING OPERATIONS IN UKRAINE AND MOLDOVA, WHICH IS CONSISTENT WITH THE PRACTICE OF OTHER U.S.-SPONSORED ENTERPRISE FUNDS OF INCLUDING THE NAMES OF THE COUNTRIES WHERE THEY OPERATE IN THE FUND NAME. ORGANIZATION MISSION - THE UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND (THE "FUND") IS A NOT-FOR-PROFIT CORPORATION FORMED PURSUANT TO THE SUPPORT FOR EAST EUROPEAN DEMOCRACY ACT OF 1989 (THE "SEED ACT") AND THE 1992 FREEDOM FOR RUSSIA AND EMERGING EURASIAN DEMOCRACIES AND OPEN MARKETS SUPPORT ACT (THE "FREEDOM SUPPORT ACT"). UMAEF'S PRIMARY PURPOSE IS PROMOTING THE DEVELOPMENT OF THE PRIVATE SECTOR, AND THE POLICIES AND PRACTICES CONDUCIVE TO SUCH DEVELOPMENT, OF THE WESTERN NIS REGION (THE "REGION"), WHICH CONSISTS OF UKRAINE, MOLDOVA AND BELARUS. THE U.S. CONGRESS AUTHORIZED APPROPRIATIONS OF $150 MILLION, WHICH WERE COMMITTED BY THE UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT ("USAID") FOR UMAEF PROGRAM PURPOSES AND ADMINISTRATIVE EXPENDITURES (THE "GRANT"). AMOUNTS RECEIVED FROM USAID WERE CONDITIONED UPON UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUNDS' COMPLIANCE WITH THE REQUIREMENTS OF THE GRANT AGREEMENT WITH USAID AND THE SEED AND FREEDOM SUPPORT ACTS, WHICH IMPOSED CERTAIN U.S. POLICY OBJECTIVES AND REPORTING OBLIGATIONS. UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND IS ENGAGED IN A BROAD PRIVATE INVESTMENT PROGRAM IN THE REGION WHICH, THROUGH EQUITY INVESTMENTS, LOANS, LEASES, TECHNICAL ASSISTANCE AND OTHER MEASURES, EMPHASIZES A COMMITMENT TO SMALL-AND MEDIUM-SIZED PRIVATE BUSINESSES. UMAEF PROVIDES TECHNICAL ASSISTANCE TO COMPANIES IN WHICH IT HAS INVESTED. THROUGH ITS DIRECT ROLE IN INVESTMENTS IN THE REGION'S PRIVATE SECTOR, UKRAINE-MOLDOVA AMERICAN ENTERPRISE SEEKS TO GENERATE PROFITS THAT WILL FURTHER SUPPORT ITS ACTIVITIES AND ATTRACT INVESTMENTS BY OTHERS. AS PART OF ITS INVESTMENT OPERATIONS, UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND MAY OBTAIN REPRESENTATION ON MANAGEMENT AND SUPERVISORY COUNCILS OF INVESTEE COMPANIES. UKARINE-MOLDOVA AMERICAN ENTERPRISE FUNDS' GRANT AGREEMENT WITH USAID STATES THAT THE SUCCESS OF UMAEF WILL BE CHARACTERIZED BY THE EXTENT TO WHICH IT CAUSES OR CONTRIBUTES TO: (1) THE SUCCESSFUL ESTABLISHMENT, OR STRENGTHENING OF, A WIDE ARRAY OF SMALL AND MEDIUM-SIZED FIRMS ACROSS THE DIFFERENT SECTORS OF THE ECONOMIES IN THE UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND REPUBLICS; (2) THE GENERATION OF NEW EMPLOYMENT OPPORTUNITIES IN THE PRIVATE SECTOR OF THE WESTERN NIS REPUBLICS; (3) INVESTMENT BY OTHER PRIVATE COMPANIES IN SECTORS WHERE UMAEF TOOK AN INITIAL LEAD; (4) THE COMPLETION OF A WIDE ARRAY OF TRANSACTIONS THAT DEVELOP AND STRENGTHEN FINANCIAL MARKETS IN THE WESTERN NIS REPUBLICS; (5) DEVELOPMENT BY UMAEF OF A NUMBER OF KEY JOINT VENTURES BETWEEN PRIVATE COMPANIES OF THE U.S. AND THE WESTERN NIS REPUBLICS; AND (6) CONSISTENT WITH UMAEF'S SOUND BUSINESS JUDGMENT, THE CONDUCT OF ACTIVITIES INTENDED TO FURTHER INVESTMENT IN EACH OF THE WESTERN NIS REPUBLICS. ONE OF UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUNDS' KEY ACCOMPLISHMENTS WAS FULFILLING THE DIRECTIVE FROM USAID TO ENABLE THE ESTABLISHMENT OF A PRIVATE SUCCESSOR FUND, EMERGING EUROPE GROWTH FUND LP (EEGF). A NEW PRIVATE INVESTMENT MANAGEMENT COMPANY, HORIZON CAPITAL ASSOCIATES LLC (HCA), WAS FORMED TO SUPPORT EEGF AND UMAEF. THIS APPROACH FOLLOWED THE PRECEDENT OF USAID-FINANCED ENTERPRISE FUNDS IN CENTRAL AND EASTERN EUROPE, WHICH SUCCESSFULLY ATTRACTED SIGNIFICANT PRIVATE CAPITAL. BASED ON USAID AND CONGRESSIONAL APPROVAL, UMAEF'S BOARD OF DIRECTORS COMMITTED $25 MILLION TO EEGF AND APPROVED THE SALE OF CERTAIN INVESTMENTS TO EEGF IN 2006. EEGF NOW FUNCTIONS AS A MID-CAP PRIVATE EQUITY FUND MAKING INVESTMENTS IN UKRAINE, MOLDOVA, AND BELARUS. UMAEF IS A CORNERSTONE LIMITED PARTNER IN EEGF. EEGF HAS INVESTED BETWEEN $5 TO $25 MILLION IN EXPANSION AND BUY-OUT OPPORTUNITIES IN THE FOLLOWING INDUSTRIES: FINANCIAL SERVICES, FAST MOVING CONSUMER GOODS, RETAIL AND INDUSTRIAL GOODS. USAID HAS ALREADY DISTRIBUTED THE FULL GRANT OF $150 MILLION TO UMAEF, WITH THE FINAL TRANCHE RECEIVED IN FISCAL YEAR 2007. ACCORDING TO THE GRANT AGREEMENT, USAID MAY ESTABLISH THE DATE AFTER WHICH UMAEF SHALL COMMENCE THE WINDING UP OF ITS AFFAIRS AND SALE OF ITS ASSETS. UNDER THIS AUTHORITY, USAID ORIGINALLY ESTABLISHED UMAEF'S TERMINATION COMMENCEMENT DATE AS AUGUST 26, 2009. DURING FISCAL YEAR 2009, UMAEF REQUESTED AND WAS GRANTED AN EXTENSION FROM USAID OF THE TERMINATION COMMENCEMENT DATE TO AUGUST 26, 2011. IN JANUARY 2011, USAID FURTHER EXTENDED THIS DATE TO AUGUST 26, 2013 WITH THE CONDITION THAT THE LEGACY PROPOSAL BE PRESENTED TO USAID BY AUGUST 26, 2011. THE LEGACY PROPOSAL SET FORTH UMAEF'S PROPOSAL FOR THE ESTABLISHMENT OF A LEGACY FOUNDATION TO BE FUNDED BY PROCEEDS DERIVED FROM THE SALE OF ASSETS. THE FUND'S PROPOSAL WAS SUBMITTED TO USAID AS REQUIRED, INCLUDING CONFIRMATION THAT AS OF AUGUST 26, 2011, UMAEF WILL NOT MAKE ANY NEW INVESTMENTS OR COMMITMENTS, ALTHOUGH THE FUND MAY MAKE FOLLOW-ON INVESTMENTS IN COMPANIES IN ITS EXISTING PORTFOLIO UNTIL AUGUST 26, 2013. THE REVISED TERMINATION COMMENCEMENT DATE. IN JUNE 2013, USAID ESTABLISHED A TARGET LIQUIDATION DATE OF AUGUST 26, 2016 AS THE DATE BY WHICH THE FUND MUST HAVE COMPLETED THE WIND-UP AND LIQUIDATION OF ALL OF ITS ASSETS. THE GRANT AGREEMENT BETWEEN UMAEF AND USAID WAS AMENDED TO REFLECT THIS TARGET LIQUIDATION DATE OF AUGUST 26, 2016 AND FURTHER STATED THAT THIS DATE MAY ONLY BE EXTENDED WITH THE PRIOR WRITTEN APPROVAL OF USAID. EFFECTIVE JANUARY 28, 2015, USAID APPROVED THE FUND'S PROPOSAL TO CONTINUE THE MISSION OF THE FREEDOM SUPPORT ACT OF 1992 AND THE FOREIGN ASSISTANCE ACT OF 1961, THROUGH THE EXISTING UMAEF STRUCTURE. AS SUCH, THE GRANT AGREEMENT WAS AMENDED TO CHANGE THE TERMINATION COMMENCEMENT DATE FROM AUGUST 26, 2013 TO DECEMBER 31, 2017 AND CHANGE THE TARGET LIQUIDATION DATE FROM AUGUST 26, 2016 TO DECEMBER 31, 2018 TO ALLOW THE FUND TO CARRY OUT THE PROGRAM ACTIVITIES DESCRIBED IN ITS PROPOSAL. THE TLD MAY ONLY BE EXTENDED WITH THE PRIOR WRITTEN APPROVAL OF USAID. THE FUND'S PROPOSAL ENVISIONED A $30 MILLION THREE-YEAR LEGACY PROGRAM FUNDED BY A PORTION OF THE REFLOWS EARNED BY THE FUND FROM ITS INVESTMENT ACTIVITIES. THE GOALS AND OBJECTIVES OF THE LEGACY PROGRAM ARE TO ASSIST UKRAINE AND MOLDOVA WITH FURTHER DEVELOPMENT OF SOUND ECONOMIC POLICIES AND LEADERSHIP DURING THIS CRITICAL TIME IN THEIR RESPECTIVE HISTORIES. BOTH UKRAINE AND MOLDOVA RECENTLY SIGNED DEEP AND COMPREHENSIVE FREE TRADE AGREEMENTS (DCFTA) WITH THE EUROPEAN UNION (EU) AND MUST NOW UNDERTAKE SIGNIFICANT CHANGES TO THEIR ECONOMIC POLICIES AND TO BUILD CADRES OF WELL-TRAINED LEADERS TO FULLY BENEFIT FROM THE DCFTA. THE FOUR PROGRAMS SET FORTH IN THE FUND'S PROPOSAL TO USAID FOCUS ON I) MOBILIZING CAPITAL TO ADDRESS COMPLEX SOCIAL ISSUES (IMPACT INVESTING PROGRAM); II) DEVELOPING INNOVATIVE MARKET-BASED SOLUTIONS LINKING LOCAL GOVERNMENT AND THE BUSINESS COMMUNITY TO IMPROVE THE PROVISION OF SERVICES TO CITIZENS WHILE SUPPORTING THE SME SECTOR (LOCAL ECONOMIC DEVELOPMENT PROGRAM); III) INVESTING IN PEOPLE TO BROADEN AND DEEPEN THE HUMAN CAPACITY NECESSARY TO ADVANCE PRIVATE SECTOR DEVELOPMENT IN UKRAINE AND MOLDOVA (ECONOMIC LEADERSHIP PROGRAM); AND IV) IMPROVING THE ABILITY OF UKRAINIAN EXPORTERS TO ACCESS NEW MARKETS (EXPORT PROMOTION POLICY PROGRAM). EFFECTIVE APRIL 14, 2016, USAID ADDITIONALLY MODIFIED THE GRANT TO CHANGE THE TERMINATION COMMENCEMENT DATE FROM DECEMBER 31, 2017 TO DECEMBER 31, 2022 AND CHANGE THE TARGET LIQUIDATION DATE FROM DECEMBER 31, 2018 TO DECEMBER 31, 2023. THE TARGET LIQUIDATION DATE MAY ONLY BE EXTENDED WITH THE PRIOR WRITTEN APPROVAL OF USAID. THE AMENDED GRANT AGREEMENT ALLOWS THE FUND: I) TO DISBURSE $5 MILLION TO MAKE NEW INVESTMENTS AND COMMITMENTS IN UKRAINE AND MOLDOVA TO ENCOURAGE THE CREATION AND EXPANSION OF SMALL AND MEDIUM ENTERPRISES (SMES); II) TO APPLY AN ADDITIONAL $5 MILLION FOR ITS LEGACY PROGRAMS, THEREBY INCREASING TOTAL ALLOWABLE FROM $30 MILLION TO $35 MILLION; III) TO COMMIT $30 MILLION OF PROGRAM INCOME AS ANCHOR INVESTOR, ON PARI PASSU TERMS WITH PRIVATE INVESTORS, IN THE EMERGING EUROPE GROWTH FUND III, L.P., A U.S.-DOMICILED FUND LAUNCHED BY HORIZON CAPITAL THAT RAISED $200 MILLION AFTER FINAL CLOSING TO PROVIDE LOANS, EQUITY AND FINANCIAL SUPPORT TO SMES IN UKRAINE AND MOLDOVA. FORM 990, PART III, LINE 1 EFFECTIVE MARCH 23, 2022, USAID ADDITIONALLY MODIFIED THE GRANT TO CHANGE THE TCD FROM DECEMBER 31, 2022 TO DECEMBER 31, 2030 AND CHANGE THE TLD FROM DECEMBER 31, 2023 TO DECEMBER 31, 2031 (GRANT MODIFICATION #25). THE AMENDED GRANT AGREEMENT (I) ENABLED THE FUND TO MAKE NEW INVESTMENTS AND COMMITMENTS AT THE DISCRETION OF ITS BOARD TO ENCOURAGE THE CREATION AND EXPANSION OF SMALL AND MEDIUM ENTERPRISES (SMES) IN UKRAINE AND MOLDOVA; II) FIXED THE BUDGET OF THE FUND'S LEGACY PROGRAMS AT $5 MILLION PER YEAR SUBJECT TO THE AVAILABILITY OF FUNDS. ADDITIONALLY, AS A RESPONSE TO FULL-SCALE RUSSIA'S INVASION TO UKRAINE, USAID AMENDED THE STRUCTURE OF ALLOWABLE EXPENDITURES. IN FEBRUARY 2022, PRIOR TO THE ONSET OF THE FULL-FLEDGED RUSSIA'S INVASION OF UKRAINE, THE FUND IMPLEMENTED ITS BUSINESS CONTINUITY PLAN, INCLUDING SECURING ACCOMMODATION IN WESTERN UKRAINE AND SUPPORTING FUND PERSONNEL AND FAMILY MEMBERS TO RELOCATE TO WESTERN UKRAINE AND THEN TO THE EUROPEAN UNION GIVEN THE HIGH PRIORITY ACCORDED TO THE SAFETY AND SECURITY OF EMPLOYEES AND PARTNERS ON-THE-GROUND IN UKRAINE. BASED ON THE USAID APPROVAL GRANTED BY THE GRANT MODIFICATION #25, UMAEF HAS INCURRED ASSOCIATED RELOCATION COSTS AND PROVIDED ADDITIONAL ASSISTANCE REQUIRED. THE UKRAINIAN LEADERSHIP ACADEMY PROGRAM STAFF AND IMMEDIATE FAMILY MEMBERS AND STUDENTS WERE ALSO RELOCATED TO WESTERN UKRAINE, WITH EXPENSES RELATED TO THEIR RELOCATION ALSO INCURRED BY THE FUND. FORM 990, PART III, LINE 2 IN FEBRUARY 2015 THE FUND STARTED LEGACY PROGRAMS SPECIFIED BY PROPOSAL THAT ENVISIONED A $30 MILLION THREE-YEAR LEGACY PROGRAM FUNDED BY A PORTION OF THE REFLOWS EARNED BY THE FUND FROM ITS INVESTMENT ACTIVITIES. IN APRIL 2016, AS A RESULT OF A GRANT MODIFICATION, THE FUND WAS ALLOWED TO USE AN ADDITIONAL $5 MILLION FOR LEGACY PROGRAMS, INCREASING TOTAL ALLOWABLE TO $35 MILLION. THE GOALS AND OBJECTIVES OF THE LEGACY PROGRAM ARE TO ASSIST UKRAINE AND MOLDOVA WITH FURTHER DEVELOPMENT OF SOUND ECONOMIC POLICIES AND LEADERSHIP DURING THIS CRITICAL TIME IN THEIR RESPECTIVE HISTORIES. BOTH UKRAINE AND MOLDOVA SIGNED DEEP AND COMPREHENSIVE FREE TRADE AGREEMENTS (DCFTA) WITH THE EUROPEAN UNION (EU) AND MUST NOW UNDERTAKE SIGNIFICANT CHANGES TO THEIR ECONOMIC POLICIES AND TO BUILD CADRES OF WELL-TRAINED LEADERS TO FULLY BENEFIT FROM THE DCFTA. THE FOUR PROGRAMS SET FORTH IN THE FUND'S PROPOSAL TO USAID FOCUS ON: I) MOBILIZING CAPITAL TO ADDRESS COMPLEX SOCIAL ISSUES (IMPACT INVESTING PROGRAM); II) DEVELOPING INNOVATIVE MARKET-BASED SOLUTIONS LINKING LOCAL GOVERNMENT AND THE BUSINESS COMMUNITY TO IMPROVE THE PROVISION OF SERVICES TO CITIZENS WHILE SUPPORTING THE SME SECTOR (LOCAL ECONOMIC DEVELOPMENT PROGRAM); III) INVESTING IN PEOPLE TO BROADEN AND DEEPEN THE HUMAN CAPACITY NECESSARY TO ADVANCE PRIVATE SECTOR DEVELOPMENT IN UKRAINE AND MOLDOVA (ECONOMIC LEADERSHIP PROGRAM); AND IV) IMPROVING THE ABILITY OF UKRAINIAN EXPORTERS TO ACCESS NEW MARKETS (EXPORT PROMOTION POLICY PROGRAM). FORM 990, PART VI, SECTION A, LINE 2 LENNA KOSZARNY AND NATALIA KOVALENKO HAD A BUSINESS RELATIONSHIP. FORM 990, PART VI, SECTION A, LINE 6 MEMBERS THE CORPORATE MEMBERS OF UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND CONSIST OF THE DIRECTORS WHO ARE U.S. CITIZENS. FORM 990, PART VI, SECTION A, LINE 7A THE MEMBERS HAVE THE RIGHTS TO ELECT AND REMOVE DIRECTORS. FORM 990, PART VI, SECTION A, LINE 7B APPROVAL BY MEMBERS USAID HAS THE AUTHORITY TO, AND IN FACT DOES, APPROVE CERTAIN UMAEF'S DECISIONS, INCLUDING THE LONG-TERM EQUITY INCENTIVE PLAN, THE PRIVATIZATION OF HORIZON CAPITAL IN 2006, THE TERMS OF THE HCA INVESTMENT MANAGEMENT AND SHARED SERVICES AGREEMENTS WITH UMAEF, AND THE CONTRIBUTION OF CERTAIN INVESTMENTS TO THE EMERGING EUROPE GROWTH FUND, LP, A REGIONAL PRIVATE EQUITY FUND LAUNCHED IN 2006 AND SALE AT COST OF TWO WAREHOUSED INVESTMENTS TO EEGF III, LP, A REGIONAL PRIVATE EQUITY FUND LAUNCHED IN 2017. USAID CONDUCTS SEMI-ANNUAL REVIEWS OF UMAEF AND REVIEWS MONTHLY REPORTS AND ANNUAL AUDITED FINANCIAL STATEMENTS AND ANNUAL REPORTS SUBMITTED BY UMAEF. FORM 990, PART VI, SECTION B, LINE 11B FORM 990 REVIEW POLICY UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND'S FORM 990 IS PREPARED BY AN INDEPENDENT ACCOUNTING FIRM IN CONJUNCTION WITH ITS FINANCE STAFF. THE CHIEF FINANCIAL OFFICER (CFO) REVIEWS, EDITS, AND APPROVES THE DRAFT FORM 990 PRIOR TO REVIEW BY THE PRESIDENT/CHIEF EXECUTIVE OFFICER (CEO). ONCE THE CEO COMPLETES REVIEW OF THE DRAFT FORM 990 AND ANY REVISIONS ARE INCORPORATED, THE DRAFT FORM 990 IS DISTRIBUTED TO A SUBCOMMITTEE OF THE BOARD FORMED TO REVIEW AND APPROVE THE FORM 990 ON BEHALF OF THE FULL BOARD OF DIRECTORS. ONCE THEIR COMMENTS ARE INCORPORATED AND THE FORM 990 IS APPROVED, A COPY OF THE FORM 990 THAT WILL BE FILED WITH THE IRS IS PROVIDED TO ALL MEMBERS OF THE BOARD OF DIRECTORS, AS WELL AS EXTERNAL CORPORATE COUNSEL, PRIOR TO FILING. FORM 990, PART VI, SECTION B, LINE 12C CONFLICT OF INTEREST POLICY OFFICERS ARE APPOINTED ON AN ANNUAL BASIS BY THE BOARD OF DIRECTORS OF UMAEF, AND THE TERMS OF APPOINTMENT INCLUDE COMPLIANCE WITH THE POLICIES AND PROCEDURES OF THE FUND, INCLUDING THE CONFLICT OF INTEREST POLICY. THE GRANT AGREEMENT WITH USAID INCLUDES THE CONFLICT OF INTEREST POLICY AND IDENTIFIES WHICH MATTERS MUST BE DISCUSSED WITH USAID. COMPLIANCE IS MONITORED VIA THE ANNUAL AUDIT PROCESS, CONDUCTED BY AN INDEPENDENT BIG 4 PUBLIC ACCOUNTING FIRM, THROUGH REVIEW OF TRANSACTIONS, INCLUDING RELATED PARTY TRANSACTIONS AND INTERNAL CONTROL PROCEDURES. ANY POTENTIAL CONFLICT WOULD BE REVIEWED AND HANDLED BY THE BOARD OF DIRECTORS AND OUTSIDE LEGAL COUNSEL. IF A CONFLICT WAS RELATED TO A BOARD MEMBER, THEN THAT BOARD MEMBER WOULD BE REQUIRED TO ABSTAIN FROM DISCUSSION AND ABSTAIN FROM VOTING ON THE CONFLICTED MATTER. FORM 990, PART VI, SECTION B, LINE 15 COMPENSATION UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND HAS A SPECIAL COMPENSATION STRUCTURE THAT REFLECTS ITS TAX-EXEMPT MISSION. AS NOTED IN PART III OF FORM 990, ONE OF UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUNDS' KEY ACCOMPLISHMENTS WAS FULFILLING THE DIRECTIVE FROM USAID TO ESTABLISH A PRIVATE FOLLOW-ON FUND, EMERGING EUROPE GROWTH FUND LP (EEGF). THIS DIRECTIVE FOLLOWED THE PRECEDENT OF USAID-FINANCED ENTERPRISE FUNDS IN CENTRAL AND EASTERN EUROPE, WHICH SUCCESSFULLY ATTRACTED SIGNIFICANT PRIVATE CAPITAL. AS DESCRIBED IN SCHEDULE O, UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND WAS NEARING ITS WIND-DOWN PHASE, AND THE FOUNDING OF EEGF WAS A SIGNIFICANT ACCOMPLISHMENT TOWARDS UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUNDS' MISSION. A PRIVATE INVESTMENT MANAGEMENT COMPANY, HORIZON CAPITAL ASSOCIATES LLC (HCA), WAS FORMED TO MANAGE THE INVESTMENTS OF EEGF AND UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND. FOLLOWING THE FOUNDING OF EEGF, ALL EMPLOYEES OF UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND (EXCEPT THOSE LOCATED IN THE U.S.) BECAME EMPLOYEES OF HCA'S SUBADVISOR ENTITY, HORIZON CAPITAL ADVISORS, LLC (HCAD), RESULTING IN THE TRANSFER OF EMPLOYEE COMPENSATION, OPERATING AND OTHER EXPENSES FROM UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND TO HCA AND HCAD. ACCORDINGLY UNTIL JANUARY 2015, UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND DID NOT HAVE EMPLOYEES, OTHER THAN AN ADMINISTRATIVE ASSISTANT AND A PART-TIME ACCOUNTANT IN THE U.S.. HOWEVER, DURING FISCAL 2015 THE FUND HAS HIRED CERTAIN EMPLOYEES FOR LEGACY PROGRAMS REALIZATION. BOTH THE FORMATION OF THE HORIZON CAPITAL ENTITIES AND OUTSOURCING OF INVESTMENT MANAGEMENT FUNCTIONS TO HCA WERE APPROVED BY USAID. UMAEF PAYS HCA AN ANNUAL MANAGEMENT FEE, AS DISCLOSED IN SCHEDULE L. THE INVESTMENT MANAGEMENT AGREEMENT WITH HCA WAS APPROVED BY THE BOARD OF DIRECTORS OF UKRAINE-MOLDOVA AMERICAN ENTERPRISE FUND, AFTER REVIEW AND APPROVAL OF ITS KEY TERMS, INCLUDING THE MANAGEMENT FEE, BY USAID, WHICH HAD PRIOR EXPERIENCE REVIEWING AND APPROVING SIMILAR INVESTMENT MANAGEMENT AGREEMENTS ENTERED INTO BY OTHER ENTERPRISE FUNDS THAT IT REGULATES. THE MANAGEMENT FEE FORMULA IS IDENTICAL TO THAT IN THE INVESTMENT MANAGEMENT AGREEMENT BETWEEN HCA AND EEGF, WHICH ALSO WAS REVIEWED AND APPROVED BY THE UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND BOARD AND USAID (AS WELL AS BY OTHER INVESTORS IN EEGF). IN FEBRUARY 2015, THE FUND ENTERED INTO A SHARED SERVICES AGREEMENT WITH HCA, APPROVED BY THE BOARD OF DIRECTORS, TO PROVIDE ADDITIONAL PROGRAM MANAGEMENT AND ADMINISTRATIVE SERVICES FOR LEGACY PROGRAMS. UMAEF PAYS HCA AN ANNUAL PROGRAM MANAGEMENT FEE, AS DISCLOSED IN SCHEDULE L. THE FUND BECAME AN ANCHOR INVESTOR OF EEGF III, THE THIRD PRIVATE FUND LAUNCHED BY HORIZON CAPITAL. BASED ON USAID APPROVAL, IN 2016, THE BOARD OF DIRECTORS OF THE FUND COMMITTED $30 MILLION TO EEGF III AND APPROVED THE WAREHOUSING OF UP TO 100% OF ITS $30 MILLION COMMITMENT OF INVESTMENTS WITHIN UMAEF, WHICH SUBSEQUENTLY WERE TRANSFERRED TO EEGF III AT COST UPON ITS FIRST CLOSING. IN AUGUST 2022, THE BOARD OF DIRECTORS APPROVED A COMMITMENT OF $10 MILLION TO HORIZON CAPITAL GROWTH FUND IV, L.P. ("HCGF IV") AT ITS FIRST CLOSING, AT PARI-PASSU TERMS WITH THIRD PARTY INVESTORS, THUS HELPING TO CATALYZE $105 MILLION OF CAPITAL FROM DEVELOPMENT FINANCIAL INSTITUTIONS ("DFIS"). THE FUND ENTERED INTO SUBSCRIPTION DOCUMENTS FOR HCGF IV AS OF SEPTEMBER 26, 2022, THUS COMMITTING $10 MILLION TO HCGF IV IN A FIRST CLOSING TOTALING $125 MILLION. AS OF SEPTEMBER 30, 2022, NO INVESTMENTS/CONTRIBUTIONS WERE MADE. HCGF IV TARGETS TOTAL COMMITMENTS OF $250 MILLION PRIOR TO ITS FINAL CLOSING, ANTICIPATED IN 2023. IN 2002, THE BOARD MEMBERS OF UMAEF ESTABLISHED A LONG-TERM EQUITY INCENTIVE PLAN ("LTEI"), WHICH WAS BASED ON SIMILAR ARRANGEMENTS AT OTHER USAID-FINANCED ENTERPRISE FUNDS AND WAS APPROVED BY THE U.S. CONGRESS AND USAID. THE LTEI PLAN IS NOT COMPENSATION FROM GOVERNMENT GRANT FUNDS BUT A SEPARATELY USAID-APPROVED INCENTIVE PLAN FUNDED FROM INVESTMENT SALES PROCEEDS. LTEI COMPENSATION IS NOT CONTINGENT ON REVENUES OR NET EARNINGS, BUT RATHER ON A PROFITABLE EXIT OF A PORTFOLIO COMPANY THAT EXCEEDS THE BASELINE VALUE SET BY THE BOARD OF DIRECTORS AND APPROVED BY USAID. UPON THE SPIN-OFF OF EMPLOYEES TO HCAD, THE LTEI PLAN REMAINS IN EFFECT AS LONG AS 1) THE INVESTMENT MANAGEMENT AGREEMENT BETWEEN UMAEF AND HCA CONTINUES; 2) THE SPECIFIC EMPLOYEE REMAINS IN THE EMPLOY OF UMAEF OR HCAD AND 3) THE BOARD OF DIRECTORS DOES NOT AMEND, ALTER OR TERMINATE THE PLAN. THIS IS INTENDED TO MAXIMIZE UMAEF'S RETURNS ON ITS REMAINING PORTFOLIO. LTEI PAYMENTS DURING THE 2022 CALENDAR YEAR ARE SET FORTH IN THE FOLLOWING PARAGRAPH. THE STATEMENT OF FUNCTIONAL EXPENSES IN PART IX SETS FORTH $9,878 OF EXPENSES UNDER THE LONG-TERM EQUITY INCENTIVE PLAN (LTEI) THAT WERE PAID OUT IN MAY 2023, BEFORE THE 9/30/23 FISCAL YEAR END. THIS AMOUNT REPRESENTS LTEI PAYMENTS MADE TO FORMER KEY EMPLOYEES ONLY. IN THE COMPENSATION SECTION OF FORM 990, PART VII, WE REPORT $1,856 OF PAID LTEI DURING THE 2022 CALENDAR YEAR TO FORMER KEY EMPLOYEES, BECAUSE THOSE SECTIONS REPORT COMPENSATION PAID DURING THE 2022 CALENDAR YEAR. IN ADDITION, WE NOTE THAT THE GRANT AGREEMENT WITH USAID PROVIDES THAT U.S. GOVERNMENT GRANT FUNDS MAY NOT BE USED TO COMPENSATE EMPLOYEES OF UMAEF, OR EMPLOYEES OF AN ORGANIZATION IN WHICH IT OWNS A MAJORITY INTEREST, OVER $150,000 PER ANNUM. THE LTEI PLAN IS NOT COMPENSATION FROM GOVERNMENT GRANT FUNDS, BUT A SEPARATELY USAID-APPROVED INCENTIVE PLAN FUNDED FROM INVESTMENT SALES PROCEEDS. FORM 990, PART VI, SECTION C, LINE 19 DISCLOSURES AS A USAID RECIPIENT, UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND' GOVERNING DOCUMENTS, INCLUDING ITS CONFLICT OF INTEREST POLICY, AND ITS FINANCIAL STATEMENTS ARE PROVIDED TO USAID AND ARE MADE AVAILABLE TO THE PUBLIC THROUGH THIS ORGANIZATION. FORM 990, PART VI, SECTION B, LINE 16 JOINT VENTURES THE TAX-EXEMPT MISSION OF UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND ESTABLISHED BY THE U.S. CONGRESS AND USAID IS DIRECTLY FURTHERED BY THE FUND'S INVESTMENTS IN SMALL-TO MID-SIZED COMPANIES IN THE UKRAINE AND MOLDOVA, AND ALSO BY ITS INVESTMENTS IN EEGF, EEGF III AND HCGF IV, REGIONAL PRIVATE EQUITY FUNDS WHOSE ESTABLISHMENT WAS ENCOURAGED, REVIEWED AND APPROVED BY USAID. UNDER THE TERMS OF ITS GRANT AGREEMENT FROM USAID, UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND TAKES A COMMERCIAL APPROACH TO ITS INVESTMENT ACTIVITIES IN PORTFOLIO COMPANIES IN THE WESTERN NEWLY INDEPENDENT STATES, AS A MATTER OF OPERATING PHILOSOPHY. THE WRITTEN GRANT AGREEMENT ALSO PROVIDES NUMEROUS TERMS AND CONDITIONS TO ENSURE THAT THE PORTFOLIO COMPANIES IT INVESTS IN FURTHER ITS TAX-EXEMPT MISSION AND USAID GUIDELINES. UKRAINE-MOLODVA AMERICAN ENTERPISE FUND HAS A WRITTEN POLICY THAT REQUIRES, AMONG OTHER THINGS, THAT ALL INVESTMENTS BE IN ACCORD WITH THE GRANT AGREEMENT, WHICH EXPRESSLY DEFINES PERMISSIBLE INVESTMENTS AS WELL AS PROHIBITED TRANSACTIONS CONSISTENT WITH UMAEF'S CONGRESSIONALLY-MANDATED CHARITABLE MISSION. IN ADDITION TO THIS WRITTEN POLICY, UKRAINE-MOLODVA AMERICAN ENTERPRISE FUND HAS ADOPTED VARIOUS MEASURES THAT SAFEGUARD ITS EXEMPT STATUS WITH RESPECT TO ITS INVESTMENTS. THESE MEASURES INCLUDE ENSURING THAT INVESTMENT AGREEMENTS WITH PORTFOLIO COMPANIES ARE ON AN ARM'S LENGTH BASIS AND CONTAIN PROVISIONS TO ASSURE COMPLIANCE WITH RELEVANT CLAUSES WITHIN THE GRANT AGREEMENT. USAID SPECIFICALLY REVIEWED AND APPROVED IN WRITING UKRAINE-MOLODVA AMERICAN ENTERPRISE FUNDS' INVESTMENTS IN EEGF, EEGF III, HORISON CAPITAL GROWTH FUND IV AND AS AN INTEGRAL PART OF ITS TAX EXEMPT MISSION. FORM 990, PART VII, SECTION B, LINE 1 INVESTMENT MANAGEMENT FEES INVESTMENT MANAGEMENT FEES IN THE AMOUNT OF $102,904 PAID TO HORIZON CAPITAL ASSOCIATES LLC REPRESENT INVESTMENT MANAGEMENT FEES PAID IN CALENDAR YEAR 2022 AS THIS IS THE CALENDAR YEAR ENDING WITHIN UKRAINE-MOLODVA AMERICAN ENTERPRISE FUNDS' TAX YEAR BEGINNING 10/01/2022 AND ENDING 9/30/2023. THIS AMOUNT DIFFERS FROM THE INVESTMENT MANAGEMENT FEES REPORTED IN SCHEDULE L PART IV BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS AS THIS LATTER AMOUNT REFLECTS ACTUAL PAYMENTS MADE IN FISCAL 2023. PROGRAM MANAGEMENT FEES PROGRAM MANAGEMENT FEES IN THE AMOUNT OF $525,000 PAID TO HORIZON CAPITAL ASSOCIATES LLC REPRESENT INVESTMENT MANAGEMENT FEES PAID IN CALENDAR YEAR 2022 AS THIS IS THE CALENDAR YEAR ENDING WITHIN UKRAINE-MOLODVA AMERICAN ENTERPRISE FUNDS' TAX YEAR BEGINNING 10/01/2022 AND ENDING 9/30/2023. THIS AMOUNT DIFFERS FROM THE INVESTMENT MANAGEMENT FEES REPORTED IN SCHEDULE L PART IV BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS AS THIS LATTER AMOUNT REFLECTS ACTUAL PAYMENTS MADE IN FISCAL 2023. FORM 990, PART XI, LINE 9: DEFERRED EXIT BASED INCENTIVE 9,878. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 EEGF III 175 W JACKSON CHICAGO IL 60604 384008850 PRIVATE EQUITY DE EXCLUDED 0 -496780 18927376 0 0 0.16390 HCGF IV 175 W JACKSON CHICAGO IL 60604 874502434 PRIVATE EQUITY DE EXCLUDED 0 0 -58230 0 0 0.08430