2017 ANNUAL REPORT

ANNUAL REPORT

I am a Veteran, having served in the United States Air Force for over 27 years, including a combat tour in Vietnam. I count myself among the lucky ones who made it through their service relatively unscathed. Others were not as fortunate. Some made the ultimate sacrifice, and some had their lives changed forever by the wounds of war and injury from service.

Our Government, mainly through the Department of Veterans Affairs (VA), tries to take care of these less fortunate Veterans. It does a reasonably good job, but like any large institution there are cracks and holes in the system. Organizations like ours fill these gaps and holes. We can’t do that without the support of caring Americans who step up through corporate and individual giving to fund programs that meet unfilled needs.

Through generous contributions, we have helped Veterans weather financial emergencies, buy first homes, secure stable lodgings, and start their own businesses. We respond to need. For example, when we learned that Veterans who were referred to the VA Polytrauma Medical Center in Palo Alto were missing appointments in large number

LETTER FROM THE CHAIRMAN

3

because of the high cost of lodging, we raised $11M to build and donate to the VA a modern 52-room lodging facility, the Lee and Penny Anderson Defenders Lodge. Since it opened in 2014, the facility has provided 100,000 free room nights to outpatients and saved them and their caregivers over $30 million in lodging expenses.

We are proud to report that every dollar we raise from the public goes directly to support the Veterans we serve. All administrative and overhead costs are borne by the Pentagon Federal Credit Union. We know this is the right thing to do with the money we raise.

I thank you on behalf of all those you have helped, and ask that you continue your caring, generous support. The Honorable Frederick F.Y. Pang Chair of the PenFed Foundation

ANNUAL REPORT

This year marked new highs for the PenFed Foundation and support for our Nation’s Military Heroes. We provided more than 600 grants to help Veterans with a disability weather a financial setback, or help a caregiver with education and childcare expenses. More than 125 Military Heroes nationwide were able to purchase a first home or replace a lost one because of the Dream Makers Program, and more than 1,800 military personnel received Foundation-backed loans so they could build their credit and avoid predatory lenders. We also partnered with Disabled American Veterans, whose offices nationwide now help the Foundation identify Veterans in need of financial assistance. 2017 also marked a tough year for Military and other families affected by Hurricanes Harvey, Irma, and Maria, but with the help of the Department of Veterans Affairs and their employees’ donations, the PenFed Foundation was able to provide more than $330,000 in aid for affected Veterans and VA employees. We also committed $300,000 to build a new home to support our wounded military receiving in-patient care at the Fort Belvoir and Walter Reed hospitals through Serve Our Willing Warriors, so that these Military Heroes might have a week of respite from the hospital to spend with their families and friends. Towards the end of the year, we secured a commitment from the PenFed Credit Union – which historically underwrote most of our expenses – to underwrite all Foundation expenses; now all donations will go 100% in direct support of our Military Heroes. Finally, none of this could be done without the support from you – our sponsors and donors. On behalf of the Military Heroes we serve, I thank you! Bruce Kasold Acting President and COO

LETTER FROM THE ACTING PRESIDENT AND COO

5

ANNUAL REPORT

THE PENFED FOUNDATION LEADERSHIP

BOARD OF DIRECTORSThe Honorable Frederick Pang, Chair

Thomas B. Dyer, Vice Chair

Fred Caprio, CLU, Secretary/Treasurer

Edward B. Cody

Sandra L. Patricola

Colonel James F. Quinn, USA (Retired)

Major General Joseph G. Lynch (Retired)

DIRECTOR EMERITUSMajor Edward D. Dauksz, USMC (Retired)

David Schaeffer

Colonel Robert W. Siegert, III, USA (Retired)

CEOJames Schenck

ACTING PRESIDENT AND COOThe Honorable Bruce Kasold

DIRECTOR OF PROGRAMS AND DEVELOPMENTMark Smith

7

DEFENDERS LODGE

The PenFed Foundation raised $11 million to help build the Lee & Penny Anderson Defenders Lodge to provide respite for Veterans and their families undergoing outpatient treatment at the Palo Alto Department of Veterans Affairs medical center. Since the facility opened in 2014, the Foundation has provided over 100,000 nights stay to our Veterans and their families and saved them more than $30 million on lodging expenses as part of this special project.

ANNUAL REPORT

2017 PROGRAM HIGHLIGHTS

Gave out

125Dream Makers Grants to help our Military Heroes purchase a home.

Provided more than

$5.8MILLION

to help military families purchase a home with Dream Makers grants.

Provided more than

600Emergency and Caregiver Grants to help Veterans weather unexpected financial setbacks, and help our Veterans’ caregivers with education and childcare support.

Provided financial support to military families totaling more than

$6.5MILLION

with the Military Heroes Fund – Emergency and Caregiver Support.

Provided more than

$460THOUSAND

to help over 450 disabled Veterans with our partnership with Disabled American Veterans

FROM INCEPTION

2017 STATISTICS Raised

$242for Hurricane Relief Grants to U.S. Department of Veterans Affairs employees and Veterans affected by the 2017 Hurricanes Maria, Harvey and Irma.

THOUSAND

*There is a $5 application fee to apply for the Interest-Free Loan

9

Backed

Interest-Free Loans*

1,800military personnel

to over

Backed more than

$8.117,900

MILLION

Interest-Free Loans* totaling nearly

$1.5has been raised for this program.

NEW PROGRAM:

MILLION

In 2018, we will begin selectively investing in and supporting Veteran entrepreneurs.

More than

ANNUAL REPORT

2017 MAJOR EVENTS

2017 NIGHT OF HEROES GALA RAISED

2017 GOLF CLASSIC RAISED

$834,633

$1.5 million

COMMUNITY SUPPORTSince 2007, Innospec, Inc. has provided more than $600,000 to the PenFed Foundation through their annual golf fundraisers to support the Military Heroes Fund.

11

2017 FINANCIAL STATEMENTS

DECEMBER 31 2017 2016

ASSETS

Cash and cash equivalents ............................................ $2,409,597 ........$1,773,106

Contributions receivable ....................................................... $57,095 .............$54,512

Prepaid expenses and other ............................................... $44,583 ............... $1,375

Property and equipment, net ................................................... $209 .................. $401

Total assets .................................................................$2,511,484 .....$1,829,394

LIABILITIES AND NET ASSETS

Liabilities

Accounts payable and accrued expenses ....................... $79,158 ............$47,968

ARK loan liability .....................................................................$60,820 ...........$116,996

Total liabilities .............................................................. $139,978 ....... $164,964

COMMITMENTS AND CONTINGENCIES

Net assets

Unrestricted net assets ......................................................$1,676,701 .........$785,054

Temporarily restricted net assets ................................... $694,805 ......... $879,376

Total net assets .........................................................$2,371,506 .... $1,644,430

Total liabilities and net assets .................................$2,511,484 .....$1,829,394

ANNUAL REPORT

“With their helping hand, I was able to

have some breathing room, which paved

the way to our long journey out of a dark

hole. Because of the PenFed Foundation,

veterans like myself can feel appreciated

and know there are good people and

organizations out there who will help.”

- Kevin Coombs, Military Heroes Grant Recipient

“We’re so grateful to have found the

Dream Makers grant from the PenFed

Foundation and that we’ve not only been

able to buy a great house, but have also

been able to start making it our own.”

- The Peterson Family, Dream Makers Grant Recipient

2017 GRANT RECIPIENT QUOTES

“As a single father that went through

some very hard times, including my son

and I being homeless, the thought of any

possibility of owning a home was beyond

my wildest dreams… I really am thankful to

Pentagon Federal Dream Makers Grant for

helping me make my dreams come true”

- Richard Yeager, Dream Makers Grant Recipient

“…It is impossible to completely convey

the gratitude in our hearts. We sustained

a great deal of material loss in Hurricane

Harvey... We certainly need some help

and this will be put to good use.”

- Kevin and Anita Walsh, Hurricane Harvey Relief Grant Recipients

“As a veteran and West Point graduate, I feel a

deep personal connection to the Foundation’s

mission. Only by giving service members

our support under the most difficult of

circumstances can we start to repay the

sacrifices that they have made for all of us.”

- James Schenck, CEO

13

“We are excited to be getting ready to

settle down after we end yet another

deployment. This wouldn’t have been made

possible if it weren’t for the generosity of

your team and all that has been done for

us and many other families. We cannot

thank the Dream Maker team enough.”

- The Shoemaker family, Dream Makers Grant Recipient

“Words cannot even begin to explain what

a relief this is. We are very thankful for your

organization and willingness to help during

this extremely difficult time. This has been

one of the most difficult times for our family,

and we are so thankful for your assistance.”

- Kristin Greathouse, Military Heroes Grant Recipient

“I’m not sure how to thank you, or explain my

level of gratitude. As a sole parent suffering

from PTSD, help with childcare is without a

doubt the best gift we could receive. Learning

the tools to better myself is necessary to be

the best parent I can be. From the bottom

of my heart, thank you, endlessly.”

- Jamie Engelbretson, Military Heroes Caregiver Grant Recipient

“If it wasn’t for the generosity of those at

the PenFed Foundation, we would no longer

have our home. We, the McKinney family,

thank you from the bottom of our hearts.”

- Tiffany McKinney, Military Heroes Grant Recipient

ANNUAL REPORT

PRESIDENT’S CIRCLEThese partners donated more than $250,000 or provided the organization with unsurpassed strategic support in the calendar year 2017.

Disabled American Veterans Charitable Service Trust

Pentagon Federal Credit Union

LEADERSHIP PARTNERS$100,000 +

Allied Solutions, LLC

The Coca-Cola Foundation

PSCU Financial Services

DISTINGUISHED PARTNERS$50,000 +

CUNA Mutual Group

HMS National

Innospec Inc.

Institutional Insurance Group, LLC

National Military Family Association

The Niner Foundation

EXCELLENCE PARTNERS$10,000 +

Affinion Group

American Express

American Society of Military Comptrollers

Andrews Federal Credit Union

Arch MI

2017 MAJOR DONORS

Arthur J. Gallagher & Co. Gallagher Bassett Services, Inc

Atlantic Coast Mortgage, LLC

BizFlow Corporation

Burns-Fazzi, Brock & Associates

Cardtronics, Inc.

Chesapeake Netcraftsmen LLC

Chicago Title Insurance Company

Cognizant US Corporation

Corelogic Real Estate Solutions LLC

Cornerstone Home Lending

CU Direct Corporation

CU Solutions Group

The Honorable Deborah James

Defense Credit Union Council

Equifax, Inc.

Federal Home Loan Bank of Atlanta

Fiserv, Inc.

Fortinet

Gilbane Development Company

HITT Contracting Inc.

HomeBridge Financial Services

IBM

The Lawrence and Nancy Padfield Foundation

Mainline Information Systems

MCS Solutions, LLC

Military Officers Association of America

The Meltzer Group

NewDay USA

NTT Data Federal, Inc.

On Q Financial

Open Lending

Priority Toyota

Quantcast

Radian Guaranty Inc.

Rate Reset

ReQuire, LLC

Route 66 Extended Warranty

RRR Automotive Group

Security 1st Title

Seguros Multiples

Softworld, Inc.

Tata America International Corp.

Thuy-Van Nguyen

Travelers

TribusAllen Inc.

TrueCar, Inc

Urban Lending Solutions Company

Veterans Canteen Service

Virtusa Corporation

Visa

WHITE64

William T. Morris Foundation

CHAMPIONS OF THE PENFED FOUNDATION$2,500 +

ABG Services Inc.

Adobe

AMO, Inc.

Aon Foundation

Argus Info & Advisory Services

Armed Forces Financial Network

Assurant

AT&T

Bankrate

Bay Equity Home Loans

BDO USA, LLP

Boeing Defense, Space & Security

CBIZ, Inc.

CDW

Cindy Fournier

Coester VMS

Corporate Press

Cox Automotive

CUNA Cooperative

15

D+H

DC Habitat for Humanity

Deluxe

Doug McCormick

Dynatrace

Edwin Phelps

Ellie Mae

Experian

Fair Isaac Corporation (FICO)

Fidelity Charitable Gift Fund

Fidelity Information Services

First American Mortgage Solutions

First Savings Mortgage Corporation

Frank Houpt

Frank McLallen

Frosch Travel

Goulston & Storrs PC

Highmark Companies, LLC

Hilton Worldwide

HSF Affiliates, LLC

InfoLock Technologies, LLC

ITility, Inc.

Jeanette Seal

Jim Coleman Toyota

John Rolando

LERETA, LLC

LexisNexis Risk Solutions

Lisa Fife

LMI

Master Print, Inc.

McBride Real Estate Services, Inc.

McW Solutions, LLC.

Miller & Long Company, Inc.

Mintel Group Ltd.

MorganFranklin Consulting, LLC

Mountford Bodington

MX Technologies, Inc.

National Mortgage Insurance Corporation

National Rifle Association

Nationwide Credit Corporation

Office Environments International

Ourisman Chantilly Imports, Inc.

Pitney Bowes

PMA Financial Network, Inc.

Price Modern

PricewaterhouseCoopers, LLP

Protiviti, Inc.

R.A. Rogers, Inc.

Roger Chinn

RSA Security LLC

Russell Rau

SalesForce

Schwab Charitable Fund

ServiceLink

Shashi Vohra

Silverback Strategies

Smartronix, Inc.

SolomonEdwards

Southeastern Underwriters

SunDun Office Refreshments

SunTrust Banks, Inc.

Susan Pence

The Honorable Frederick Pang

The Punaro Group

Vero Products

Vivienne Halpern

William Karlson

PenFedFoundation.org800-558-9224