2022-08-08T17:59:03-05:00 2021-09-30 135565207 KPMG LLP 8350 BROAD STREET SUITE 900 MCLEAN VA 22102 990 2020-10-01 133786524 WESTERN NIS ENTERPRISE FUND WEST 3129397003 175 WEST JACKSON BLVD STE 1640 CHICAGO IL 60604 JAROSLAWA Z JOHNSON PRESIDENT & CEO 3129397003 2022-08-08 1 JAROSLAWA JOHNSON 999009999 MARGARET A BRADSHAW P00501222 7032868000 2022-08-08 3 AAL1 IAL1 2020 2022-09-23 18:48:47Z JAROSLAWA Z JOHNSON 175 WEST JACKSON BLVD STE 1640 CHICAGO IL 60604 4246374 0 X WWW.WNISEF.ORG X 1994 IL WESTERN NIS WAS CREATED AND FUNDED BY THE US CONGRESS, TO INVEST IN AND (SEE SCHEDULE O) 6 5 2 0 0 0 0 110020 -6873544 4100098 55 55 65028 36201 -6808461 4246374 1771586 793443 0 0 2259870 3959677 0 0 0 1095970 1776375 5127426 6529495 -11935887 -2283121 76506363 84059720 1827849 860307 74678514 83199413 X SEE SCHEDULE O 0 0 3771420 4090989 WESTERN NIS ENCOURAGES, THROUGH LENDING, INVESTMENT, AND TECHNICAL ASSISTANCE, THE CREATION AND EXPANSION OF SMALL AND MEDIUM-SIZED ENTERPRISES IN THE UKRAINE AND MOLDOVA. WESTERN NIS 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. 2545032 793443 9110 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. 6316452 1 1 0 0 0 0 0 0 0 0 1 0 1 0 1 1 1 0 0 1 1 1 1 0 0 0 0 0 0 1 0 0 0 0 0 0 0 1 0 0 0 0 0 1 1 1 0 1 1 X 5 0 1 2 1 0 1 UP MD UK RO 0 0 0 0 0 0 0 0 0 0 X 6 5 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 562235 0 38201 DENNIS A JOHNSON DIRECTOR 1.00 0.00 X 0 0 0 DANIEL F RUNDE DIRECTOR 1.00 0.00 X 0 0 0 MARTA FARION DIRECTOR 1.00 0.00 X 0 0 0 JEFFREY C NEAL DIRECTOR 1.00 0.00 X 0 0 0 JOHN E HERBST DIRECTOR 1.00 0.00 X 0 0 0 ELAINE MCCORMACK SECRETARY 33.00 0.00 X 72711 0 16110 LENNA KOSZARNY EXECUTIVE VICE PRESIDENT 1.00 0.00 X 282396 0 0 NATALIA KOVALENKO CFAO & TREASURER 1.00 0.00 X 28240 0 0 BIGDAI VITALIY PROGRAM MANAGER 40.00 0.00 X 100240 0 0 OZYMOK IRYNA PROGRAM MANAGER 40.00 0.00 X 100240 0 0 TYCHKIVSKII ROMAN PROGRAM MANAGER 40.00 0.00 X 100240 0 0 1246302 0 54311 5 0 1 0 HORIZON CAPITAL ASSOCIATES LLC 175 W JACKSON BLVD STE 1640 CHICAGO IL 60604 INVESTMENT/PROG MGT FEES 1480473 1 110020 110020 REALIZED GAIN FROM PRI 523000 3998670 3998670 INTEREST FROM PRIS 523000 101095 101095 DIRECTOR FEES FROM PRI 523000 333 333 4100098 55 55 MISCELLANEOUS 900099 36201 1 36200 36201 4246374 4100099 0 36255 793443 793443 1173878 1113291 60587 728027 728027 1932392 1893487 38905 35441 32538 2903 89939 79123 10816 50701 46046 4655 99388 79510 19878 137911 128846 9065 35548 29816 5732 11716 10608 1108 128845 103076 25769 45836 40166 5670 87166 85842 1324 25729 20901 4828 59781 47825 11956 FINANCIAL PART. RIGHTS 1080000 1080000 BANK FEE 11180 8977 2203 MEMBERSHIP FEE 6375 5100 1275 OTHER OPERATING EXPENSE -3801 -10170 6369 6529495 6316452 213043 0 X 14487421 40074472 50632 204964 197584 176274 34196 21310 61056053 43060757 878061 698217 76506363 84059720 1466258 342868 30000 331591 517439 1827849 860307 X 74678514 83199413 74678514 83199413 76506363 84059720 -2283121 10816218 -12198 X 0 1 X 1 0 X 110020 110020 620686 299972 157330 298507 101428 1477923 620686 299972 157330 298507 211448 1587943 0 0 0 1587943 55 55 55 55 55 275 55 55 55 55 55 275 36000 36015 36000 36000 36201 180216 656741 336042 193385 334562 247704 1768434 0.89790 0.89240 0.00020 0.00020 X PART III, SECTION B, LINE 12 OTHER INCOME OTHER INCOME CONSISTS OF EXPENSE REIMBURSEMENTS AND OTHER MISCELLANEOUS INCOME. RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 4646 4646 0 192938 171628 21310 21310 EQUITY & DEBT SECURITIES 4133196 F EMERGING EUROPE GROWTH FUND LP 169967 F OTHER FINANCIAL ASSETS 610000 F EMERGING EUR. GROWTH FUND III 38147594 F 43060757 THIRD-PARTY FRAMEWORK AGREEMENT 467757 EXIT-BASED INCENTATIVE PAYABLE 12198 OTHER LIABILITIES 37484 517439 X 15062592 10816218 10816218 4246374 0 4246374 6541693 12198 12198 6529495 0 6529495 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 2C DEFERRED EXIT-BASED INCENTIVE - 12,198 1 RUSSIA/INDEPENDENT STATES 2 12 PROGRAM SERVICES GENERAL OPERATIONS 5363649 RUSSIA/INDEPENDENT STATES 0 0 GRANTMAKING 793443 RUSSIA/INDEPENDENT STATES 0 0 INVESTMENTS 4743196 2 12 0 0 2 12 10900288 0 10900288 RUSSIA/NEWLY IND. STATES EDUCATION 12500 WIRE RUSSIA/NEWLY IND. STATES EDUC & COMM 15000 WIRE RUSSIA/NEWLY IND. STATES EDUCATION 98894 WIRE RUSSIA/NEWLY IND. STATES IIP - OTHER 8000 WIRE RUSSIA/NEWLY IND. STATES LEDP- OTHER 13840 WIRE RUSSIA/NEWLY IND. STATES LEADERSHIP 540000 WIRE 5 SCHOLARSHIPS RUSSIA/NEWLY IND. STATES 3 98972 WIRE 1 0 1 0 1 0 PART I, LINE 2: GRANT MONITORING REGULAR AND RIGOROUS REVIEW IS CONDUCTED BY WNISEF 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 WNISEF 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 WNISEF WRITTEN INTERIM AND/OR FINAL REPORTS TO REFLECT THE PROGRESS ON ACTIVITIES AND PROJECT'S RESULTS AND IMPACT TO DATE. WNISEF 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 WNISEF A FINANCIAL REPORT FOR USE OF FUNDS TO DETERMINE EXPENDITURE AGAINST THE FUNDING AGREEMENT. PART I, LINE 3: FOREIGN ACTIVITIES WESTERN NIS HAS AN OFFICE IN THE US, BUT MOST OF ITS OPERATIONS ARE IN UKRAINE AND MOLDOVA, GIVEN ITS TAX-EXEMPT MISSION. (SEE SCHEDULE O FOR ADDITIONAL DETAILS.) WESTERN NIS 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 2021. NO INDIRECT EXPENSE ALLOCATIONS HAVE BEEN MADE. FOREIGN FILING 5471 5471 THE FOREIGN FILING REQUIREMENT, FORM 5471, INFORMATION RETURN OF U.S. PERSONS WITH RESPECT TO CERTAIN FOREIGN CORPORATIONS, FOR LLC KERAMEYA, A FOREIGN CORPORATION, HAS BEEN SATISFIED BY THE FOLLOWING U.S. PERSON: NAME: EMERGING EUROPE GROWTH FD, LP ADDRESS: 175 WEST JACKSON BOULEVARD, CHICAGO, IL 60604 EIN: 20-2901144 WHERE RETURN FILED: E FILED FOREIGN FILING 8865 8865 THE FOREIGN FILING REQUIREMENT, FORM 8865, RETURN OF U.S. PERSONS WITH RESPECT TO CERTAIN FOREIGN PARTNERSHIPS, FOR SAKONIA VENTURE LIMITED, A FOREIGN PARTNERSHIP, HAS BEEN SATISFIED BY THE FOLLOWING U.S. PERSON: NAME: EMERGING EUROPE GROWTH FD, LP ADDRESS: 175 WEST JACKSON BOULEVARD, CHICAGO, IL 60604 EIN: 20-2901144 WHERE RETURN FILED: E FILED PART III ACCOUNTING METHOD: X X 1 1 X 0 0 0 0 0 0 0 0 0 JAROSLAWA ZELINSKY JOHNSON PRESIDENT & CEO 150000 0 376530 0 35705 0 38201 0 0 0 600436 0 0 0 LENNA KOSZARNY EXECUTIVE VICE PRESIDENT 0 0 282396 0 0 0 0 0 0 0 282396 0 0 0 PART I, LINE 1A FIRST CLASS TRAVEL - WNISEF BOARD MEMBERS VOLUNTEER THEIR TIME TO ATTEND BOARD MEETINGS AND DO NOT RECEIVE ANY COMPENSATION FOR THEIR PARTICIPATION ON THE WNISEF BOARD. HOWEVER, IN ACCORDANCE WITH THE GRANT AGREEMENT WITH THE U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT, BOARD MEMBERS ARE PERMITTED TO FLY FIRST CLASS IN RECOGNITION OF THE EXPECTATION OF TRAVELING FROM THE UNITED STATES TO THE REGION, INCLUDING UKRAINE AND MOLDOVA. CERTAIN BOARD MEMBERS ELECTED TO UTILIZE THIS BENEFIT DURING THE REPORTING PERIOD. THE COST OF THE TICKET IS NOT INCLUDED IN THE DIRECTOR'S REPORTABLE COMPENSATION, BUT IS INSTEAD CONSIDERED A NON-TAXABLE REIMBURSEMENT. A HOUSING ALLOWANCE IS PROVIDED TO THE PRESIDENT/CEO. THIS ALLOWANCE IS TREATED AS TAXABLE COMPENSATION. LONG-TERM EQUITY INCENTIVE PLAN (LTEI) DURING THE FISCAL YEAR, THE CEO AND OTHER OFFICER SHOWN ON SCHEDULE J, PART II RECEIVED PAYMENT PER THE LONG-TERM EQUITY INCENTIVE (LTEI) PLAN, A CARRY-TYPE ARRANGEMENT RELATING TO SUCCESSFUL EXITS OF PORTFOLIO COMPANIES, WHICH WERE APPROVED BY BOARD OF DIRECTORS, USAID AND RECEIVED CONGRESSIONAL APPROVAL. LTEI COMPENSATION IS NOT CONTINGENT ON REVENUES OR NET EARNINGS, IT IS CONTINGENT UPON A SUCCESSFUL EXIT OF A PORTFOLIO COMPANY THAT EXCEEDS THE BASELINE VALUE SET BY THE BOARD OF DIRECTORS AND APPROVED BY USAID. SEE SCHEDULE O - COMPENSATION FOR ADDITIONAL INFORMATION. HORIZON CAPITAL ASSOCIATES LLC MGMT OVERLAP - SEE SCH O 1012432 INVEST MGT. 0 HORIZON CAPITAL ASSOCIATES LLC MGMT OVERLAP - SEE SCH O 1050000 PROGRAM MGT 0 BUSINESS TRANSACTIONS WITH INTERESTED PERSONS SCHEDULE L, PART IV - DURING THE YEAR ENDED SEPTEMBER 30, 2021, LENNA KOSZARNY (OFFICER) WAS OWNER AND/OR OFFICER OF HORIZON CAPITAL ASSOCIATES LLC (HCA), THE INVESTMENT MANAGEMENT COMPANY CONTRACTED TO MANAGE THE WESTERN NIS PORTFOLIO. AS NOTED IN PART III OF FORM 990, ONE OF WESTERN NIS' 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 WESTERN NIS. 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 WESTERN NIS' MISSION. THE INVESTMENT MANAGEMENT AGREEMENT WITH HCA WAS ENTERED INTO BY WESTERN NIS ON PARI PASSU TERMS AS THE THIRD-PARTY INVESTMENT MANAGEMENT AGREEMENT BETWEEN HCA AND EMERGING EUROPE GROWTH FUND, LP TO ENSURE THAT THE WESTERN NIS-HCA INVESTMENT MANAGEMENT AGREEMENT WAS IN LINE WITH MARKET TERMS. UNDER THE TERMS OF THE GRANT AGREEMENT WITH USAID, WESTERN NIS IS MANAGED BY A BOARD OF DIRECTORS COMPRISED OF PRIVATE CITIZENS (A MAJORITY OF WHOM MUST BE US 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 THE 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 THEN APPROVE ANY NEW BOARD MEMBERS PRIOR TO THEIR COMMENCING BOARD PARTICIPATION. RE-ELECTION OF ANY CURRENT DIRECTOR ALSO REQUIRES USAID APPROVAL. FOLLOWING THE FOUNDING OF EEGF, ALL EMPLOYEES OF WESTERN NIS (EXCEPT THOSE LOCATED IN THE US) 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 WESTERN NIS 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 WESTERN NIS-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. FORM 990, PART I, LINE 1 ATTRACT PRIVATE CAPITAL TO UKRAINE, MOLDOVA, AND BELARUS, TO PROMOTE ENTREPRENEURSHIP AND OPEN MARKETS. FORM 990, PART III, LINE 1 ORGANIZATION MISSION - THE WESTERN NIS (NEW INDEPENDENT STATES) 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"). WESTERN NIS' 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 WESTERN NIS PROGRAM PURPOSES AND ADMINISTRATIVE EXPENDITURES (THE "GRANT"). AMOUNTS RECEIVED FROM USAID WERE CONDITIONED UPON WESTERN NIS' 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. WESTERN NIS 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. WESTERN NIS PROVIDES TECHNICAL ASSISTANCE TO COMPANIES IN WHICH IT HAS INVESTED. THROUGH ITS DIRECT ROLE IN INVESTMENTS IN THE REGION'S PRIVATE SECTOR, WESTERN NIS SEEKS TO GENERATE PROFITS THAT WILL FURTHER SUPPORT ITS ACTIVITIES AND ATTRACT INVESTMENTS BY OTHERS. AS PART OF ITS INVESTMENT OPERATIONS, WESTERN NIS MAY OBTAIN REPRESENTATION ON MANAGEMENT AND SUPERVISORY COUNCILS OF INVESTEE COMPANIES. WESTERN NIS' GRANT AGREEMENT WITH USAID STATES THAT THE SUCCESS OF WESTERN NIS 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 WESTERN NIS 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 WESTERN NIS 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 WESTERN NIS OF A NUMBER OF KEY JOINT VENTURES BETWEEN PRIVATE COMPANIES OF THE US AND THE WESTERN NIS REPUBLICS; AND (6) CONSISTENT WITH WESTERN NIS' SOUND BUSINESS JUDGMENT, THE CONDUCT OF ACTIVITIES INTENDED TO FURTHER INVESTMENT IN EACH OF THE WESTERN NIS REPUBLICS. ONE OF WESTERN NIS' 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 WESTERN NIS. 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, WESTERN NIS' 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. WNISEF 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 WESTERN NIS, WITH THE FINAL TRANCHE RECEIVED IN FISCAL YEAR 2007. ACCORDING TO THE GRANT AGREEMENT, USAID MAY ESTABLISH THE DATE AFTER WHICH WESTERN NIS SHALL COMMENCE THE WINDING UP OF ITS AFFAIRS AND SALE OF ITS ASSETS. UNDER THIS AUTHORITY, USAID ORIGINALLY ESTABLISHED WESTERN NIS' TERMINATION COMMENCEMENT DATE AS AUGUST 26, 2009. DURING FISCAL YEAR 2009, WESTERN NIS 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 WESTERN NIS' 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, WNISEF 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 WESTERN NIS 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 WNISEF 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 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 WESTERN NIS CONSIST OF THE DIRECTORS WHO ARE US 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 WESTERN NIS' 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 WESTERN NIS, 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 WESTERN NIS AND REVIEWS MONTHLY REPORTS AND ANNUAL AUDITED FINANCIAL STATEMENTS AND ANNUAL REPORTS SUBMITTED BY WESTERN NIS. FORM 990, PART VI, SECTION B, LINE 11B FORM 990 REVIEW POLICY WESTERN NIS 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 WESTERN NIS ENTERPRISE FUND, 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 WESTERN NIS HAS A SPECIAL COMPENSATION STRUCTURE THAT REFLECTS ITS TAX-EXEMPT MISSION. AS NOTED IN PART III OF FORM 990, ONE OF WESTERN NIS' 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, WESTERN NIS WAS NEARING ITS WIND-DOWN PHASE, AND THE FOUNDING OF EEGF WAS A SIGNIFICANT ACCOMPLISHMENT TOWARDS WESTERN NIS' MISSION. A PRIVATE INVESTMENT MANAGEMENT COMPANY, HORIZON CAPITAL ASSOCIATES LLC (HCA), WAS FORMED TO MANAGE THE INVESTMENTS OF EEGF AND WESTERN NIS. FOLLOWING THE FOUNDING OF EEGF, ALL EMPLOYEES OF WESTERN NIS (EXCEPT THOSE LOCATED IN THE US) BECAME EMPLOYEES OF HCA'S SUBADVISOR ENTITY, HORIZON CAPITAL ADVISORS, LLC (HCAD), RESULTING IN THE TRANSFER OF EMPLOYEE COMPENSATION, OPERATING AND OTHER EXPENSES FROM WESTERN NIS TO HCA AND HCAD. ACCORDINGLY UNTIL JANUARY 2015, WESTERN NIS DID NOT HAVE EMPLOYEES, OTHER THAN AN ADMINISTRATIVE ASSISTANT AND A PART-TIME ACCOUNTANT IN THE US. 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. WESTERN NIS 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 WESTERN NIS, 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 WESTERN NIS 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. WESTERN NIS 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 WNISEF, WHICH SUBSEQUENTLY WERE TRANSFERRED TO EEGF III AT COST UPON ITS FIRST CLOSING. IN 2002, THE BOARD MEMBERS OF WESTERN NIS 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 US 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 WESTERN NIS AND HCA CONTINUES; 2) THE SPECIFIC EMPLOYEE REMAINS IN THE EMPLOY OF WNISEF OR HCAD AND 3) THE BOARD OF DIRECTORS DOES NOT AMEND, ALTER OR TERMINATE THE PLAN. THIS IS INTENDED TO MAXIMIZE WESTERN NIS' RETURNS ON ITS REMAINING PORTFOLIO. LTEI PAYMENTS DURING THE 2020 CALENDAR YEAR ARE SET FORTH IN THE FOLLOWING PARAGRAPH. THE STATEMENT OF FUNCTIONAL EXPENSES IN PART IX SETS FORTH $2,155,718 OF EXPENSES UNDER THE LONG-TERM EQUITY INCENTIVE PLAN (LTEI) THAT WERE PAID OUT IN DECEMBER 2020 AND AUGUST 2021, BEFORE THE 9/30/21 FISCAL YEAR END. THIS AMOUNT IS COMPRISED OF $788,726 OF LTEI PAYMENTS MADE TO CURRENT OFFICERS AND $7,024 OF RELATED TAXES AND $1,359,968 OF LTEI PAYMENTS MADE TO CURRENT AND FORMER KEY EMPLOYEES. IN THE COMPENSATION SECTION OF FORM 990, PART VII, WE REPORT $687,166 OF PAID LTEI AND $5,460 OF RELATED TAXES PAID DURING THE 2020 CALENDAR YEAR TO CURRENT OFFICERS AND $1,176,654 OF PAID LTEI TO CURRENT AND FORMER KEY EMPLOYEES, BECAUSE THOSE SECTIONS REPORT COMPENSATION PAID DURING THE 2020 CALENDAR YEAR. IN ADDITION, WE NOTE THAT THE GRANT AGREEMENT WITH USAID PROVIDES THAT US GOVERNMENT GRANT FUNDS MAY NOT BE USED TO COMPENSATE EMPLOYEES OF WESTERN NIS, 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, WESTERN NIS' 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 WESTERN NIS ENTERPRISE FUND ESTABLISHED BY THE US 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 AND EEGF III, REGIONAL PRIVATE EQUITY FUNDS WHOSE ESTABLISHMENT WAS ENCOURAGED, REVIEWED AND APPROVED BY USAID. UNDER THE TERMS OF ITS GRANT AGREEMENT FROM USAID, WESTERN NIS 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. WESTERN NIS 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 WESTERN NIS' CONGRESSIONALLY - MANDATED CHARITABLE MISSION. IN ADDITION TO THIS WRITTEN POLICY, WESTERN NIS 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 WESTERN NIS' INVESTMENTS IN EEGF AND EEGF III 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 $ 955,473 PAID TO HORIZON CAPITAL ASSOCIATES LLC REPRESENT INVESTMENT MANAGEMENT FEES PAID IN CALENDAR YEAR 2020 AS THIS IS THE CALENDAR YEAR ENDING WITHIN WESTERN NIS' TAX YEAR BEGINNING 10/01/2020 AND ENDING 9/30/2021. THIS AMOUNT DIFFERS FROM THE INVESTMENT MANAGEMENT FEE REPORTED IN SCHEDULE L PART IV BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS AS THIS LATTER AMOUNT REFLECTS ACTUAL PAYMENTS MADE IN FISCAL 2021. PROGRAM MANAGEMENT FEES PROGRAM MANAGEMENT FEES IN THE AMOUNT OF $525,000 PAID TO HORIZON CAPITAL ASSOCIATES LLC REPRESENT PROGRAM MANAGEMENT FEES PAID IN CALENDAR YEAR 2020 AS THIS IS THE CALENDAR YEAR ENDING WITHIN WESTERN NIS' TAX YEAR BEGINNING 10/01/2020 AND ENDING 9/30/2021. IT COULD DIFFER FROM THE PROGRAM MANAGEMENT FEE REPORTED IN SCHEDULE L PART IV BUSINESS TRANSACTIONS INVOLVING INTERESTED PERSONS AS THIS LATTER AMOUNT REFLECTS ACTUAL PAYMENTS MADE IN FISCAL 2021. PART X, LINE 28 IN 2015 THE FUND STARTED ITS ACTIVITIES UNDER LEGACY PROGRAMS AND STARTED TO FOLLOW THE ACCOUNTING STANDARD CODIFICATION (ASC) TOPIC 958, NOT-FOR-PROFIT ENTITIES, WHICH REQUIRES ADDITIONAL DISCLOSURES, RESULTING IN RELATED CHANGES IN THE PRESENTATION OF THE FINANCIAL STATEMENTS AND NOTES TO THEM. THE FUND HAS IMPLEMENTED ASU 2016-14 AND HAS ADJUSTED THE PRESENTATION IN ITS FINANCIAL STATEMENTS. FUND BALANCE PREVIOUSLY REPORTED AS TEMPORARILY RESTRICTED IS NOW REPORTED AS FUND BALANCE WITH DONOR RESTRICTIONS. GLASS CONTAINER PRIM SA 201 UZINELOR STR CHISINAU MD MANUFACTURING MD WNISEF C 5259397 1 GLASS CONTAINER PRIM PLUS SRL 201 UZINELOR STR CHISINAU MD LEASING ASSET MD GLASS CONTAINER C 702384 1 GLASS CONTAINER PRIM SP SRL SECT1 STR STROCCIDENTULUI 33 BU RO DISTRIBUTOR RO GLASS CONTAINER C 606912 1 1 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 GLASS CONTAINER PRIM SA A 80858 ACCRUAL GLASS CONTAINER PRIM SA D 94016 ACCRUAL GLASS CONTAINER PRIM SA S 2000745 ACTUAL EEGF III 175 W JACKSON CHICAGO IL 60604 384008850 PRIVATE EQUITY DE EXCLUDED 0 166607 16845965 0 0 0.16400