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CSC - WilmingtonSuite 4002711 Centerville Road

Wilmington DE 19808800-927-9800302-636-5454

CSC.

CORPORATION SERVICE COMPANY

To: DEPT. OF LAW OFFICE OF ATTY GENERAL, CHARITIES BUREAU

From: Cathy C. Kelleher

Date: August 11, 2011

Order#: 875692-010

Re: AMERICANS FOR PROSPERITY FOUNDATION

Enclosed please find:XX Charitable Registration

XX RenewalXX Check in the amount of $125.00.XX Other:

XX Articles of IncorporationXX BylawsXX IRS Determination LetterXX List of Board Members/TrusteesXX IRS form 990XX State Filing Responsibility ListXX Audited Financial StatementXX State by State Registry

Please take the following action:XX File with the state of NEW YORK on an. expedited basis.XX Issue Proof of Filing.XX Please email confirmation to: ckellehe@cscinfo.com

SPECIAL INSTRUCTIONS:Please return all evidence of this filing to the above

referenced address. Thank you for your assistance in this matter.If there are any problems or questions with this filing, please callour office.

(^a r/.zrAnnual Filing for Charitable Organizations

Form C HAR500 New York State Department of Law (Office of the Attorney General) 0Charities Bureau - Registration Section

120 BroadwayNew York, NY 10271

http://www.charitiesnys.com -

1. General Information

Ia. For the fiscal year beginning (nn1dd1yyyy) 01/01 / 2 0 1 0 and ending (vddlyyyy) 12/31/2010b. Check if applicable for NYS: c. Name of organization d. Fed, employer ID no. (EIN) (## #######)

O Address change Americans for Prosperity Foundation 52-1527294

O Name change . e. NY State registration no. (##4#-##)

El Initial filing 1640-53

0 Final filingNumber and street (or P.O. box if mail not delivered to street address) Room/suite f. Telephone number

O Amended filing2111 Wilson Blvd. 350 703 224-3200

O NY registration pending City or town, state or country and zip + 4g. Email

Arlington, VA 22201 . csccharitable@cscinfo.com

2. Certification - Two Signatures Required

We certify under penalties of perjury that we reviewed this report, including all attachments, and to the best of our knowledge and belief, they are true,correct and complete in accordance with the laws of the S Yo rk applicable to this report.

g/Tim Phillips, Presidenta. President or Authorized Officer

John Flynn. Secretary/Treasurer 7ojPrinted Name Title Date

b. Chief Financial Officer or Treas. nature Printed Name Title f Date

3. Annual Report Exemption Information

a. Article 7-A annual report exemption (Article 7-A registrants and dual registrants)Check

j if total contributions from NY State (including residents, foundations, corporations, government agencies, etc.) did not exceed$25,000 and the organization did not engage a professional fund raiser (PFR) or fund raising counsel (FRC).to solicitcontributions during this fiscal year.

NOTE: An organization may claim this exemption if no PFR or FRC was used and either: 1) it received an allocation from a federated fund,United Way or incorporated community appeal and contributions from other sources did not exceed $25,000 or 2) it received all orsubstantially all of its contributions from one government agency to which it submitted an annual report similar to that required by Article 7-A.

b. EPTL annual report exemption (EPTL registrants and dual registrants)Check 111 if gross receipts did not exceed $25,000 and assets (market value) did not exceed $25,000 at any time during this fiscal year.

For EPTL or Article-7A registrants claiming the annual report exemption under the one law under which they are registered and for dual registrants claiming the annual reportexemptions under both laws, simply complete part 1 (General Information), part 2 (Certification) and part 3 (Annual Report Exemption Information) above.

Do not submit a fee, do not complete the following schedules and do not submit any attachments to this form.

4. Article 7-A Schedules

If you did not check the Article 7-A annual report exemption above, complete the following for this fiscal year:

a. Did the organization use a professional fund raiser, fund raising counsel or commercial co-venturer for fund raising activity in NY State? .,j Yes* If "Yes", complete Schedule 4a.

b. Did the organization receive government contributions (grants)? .......................................................... 0 Yes No* If "Yes", complete Schedule 4b.

5. Fee Submitted: See last page for summary of fee requirements.

Indicate the filing fee(s) you are submitting along with this form:a. Article 7-A filing fee ................................................ $b. EPTL filing fee .................................................... $c. Total fee ........................................................ $

Submit only one check or money order for thetotal fee, payable to "NYS Department of Law"

6. Attachments - For organizations that are not claiming annual report exemptions under both laws, see last page for required attachments ---i I

CHAR500 - 2010

Schedule 4a: Professional Fund Raisers (PFR), Fund Raising Counsels (FRC), Commercial Co-Venturers (CCV)

If you checked the box in question 4.a. on page 1, complete the following schedule for each PFR, FRC or CCV that the organization engaged forfund raising activity in NY State:

1. Type of fund raising professional (FRP):Professional fund raiser .......................................................................................... ❑

Fund raising counsel ............................................................................................

Commercial co-venturer .......................................................................................... ❑

2. Name of FRP:

Number and streetor P.O. box if mail is not delivered to street address):

c ( Jor-i cktik frwf E- San an VA}-- 2z3City or town, state or country and zip + 4:

3. FRP telephone number:

4. Services provided by FRP (provide description):

5. Compensation arrangement with FRP (provide description):

3oiCa1 or e-p'e- wtt -rtr

6. Dates of contract ................................................ d [^t^ l6 through mm/dd/yyyy) (mm/dd/yyyy)

7. Amount paid to FRP ......................................................................... $

8. If services were provided by a CCV, did the CCV provide the charitable organization with the interim report(s) required by §§ 173-a. 3 of theExecutive Law?

CHAR500 - 2010

Schedule 4b: Government Contributions (Grants)

If you checked the box in question 4.b. on page 1 complete the following schedule for each government contribution (grant). Use additional copiesof this page if necessary to list each government contribution (grant) separately.

Government Agency Name Grant Amountn/a $

$$$$$$$$$$$$$$$$$$$$$$$$$$$

Total Government Contributions (Grants) $

CHAR500 -20

State ZIP code + 4

VA 22201 . . G Gross rcelpts$18,833,09'H(a) Is this a group return for affiliates?H Yes

VA 22201 H(b) Are all affiliates included? YIf 'No,' attach a haL (see instructions)

fl) or 11527 Inumber

#350 A:tl4 (ins prt nfl

NoNo

Other"'- I L Year ofFormation: 1987 I M State of. legal domicile: DE

47,985.10,538,741.

0.0.

2,564,996.0.

467,937.69,499.1,614.

17,461,125..

3,307,403.127,640.

0M13 No. 1545.0047

2010

Open to Public- Inspection

Employer Identification Number

52-1527294Telephone number

(703) 224-3200

Form 990 Return of Organization Exempt From Income TaxUnder section 501(c), 527, or 4947(aXl) of the Internal Revenue Code

(except black lung benefit trust or private foundation)Do,rile

artment of the Treasurymal Revenue Service - The organization may have to use a copy of this return to satisfy state ieporting requirements

A For the 2010 calendar year, or tax year beginning 2010 and ending -B Check it applicable: C Name of organization americans for Prosperity Foundation 1

] Address change Doing Business As -

Name change Number and street (or P.O. box if mail is not delivered to street sddr) Room/suite E

Initial return 2111 Wilson Boulevard 350 -Terminated City, town or country

Amended return ArlingtonApplication pending F Name and address of principal officer:

Tim Phi 11i 2111 wilson

Taxtempt status lxi 501 (c)(3) _I 1501 (C

J Website: - www americans for

K Form of tnaniaotieA: ii] Corporation 11i

0UM

E

0

Cdaa

>

4

1 Briefly describe the organizations mission or most significant activities: Educate j:)usinesSpersons aria consumers..12 2atiOfl and value—of—ajQ

2 Check this box flit the organization discontinued its operations or disposed of more than 25% of its net assets,3 Number of voting members of the governing body (Part VI, line la) .............,.-......--.... 3 64 Number of independent voting members of the governing body (Part VI, line ib)..........,............. '4 65 Total number of individuals employed in calendar year 2010 (Part V, line 2a).... , ....... ,. ... .... 5 1086 Total number of volunteers (estimate if necessary) .......................... ........ ... ......... ........6 - 5007a Total unrelated business revenue from Part VIII, column (C), line 12 .......................................7a 0.

b Net unrelated business taxable income from Form 990-T, line 34..........................................7bPrior Year Current Year

8 Contributions and grants (Part VIII, line lh) ............................................ 10.375.217. 16. 922,075.9 Program service revenue (Part VIII, line 2g) .............................

10 Investment income (Part VIII, column (A), lines 3, 4, and 7d) £ 11 Other revenue (Part VIII, column (A), lines 5, 6d, Sc, 9c, lOc, and lie) ................- 12 Total revenue - add lines 8 through 11 (ñnist.eual Part VIII, column (A) line 12)

13 Grants and similar amounts paid (Part IX, column (A), lines 1-3) ......... . .............14 Benefits paid to or for members (Part IX, column (A), line 4) ..................... ......15 Salaries, other compensation, employee benefits (Part IX, column (A), lines 5-10) 16a Professional fundraising fees (Part IX, column (A), line lie)

a. b Total fundraising expenses (Part IX, column (D), line 25)" 978, 971 Ul 17 Other expenses (Part IX, column (A), lines ila-ild, ilf.24f) .......... ...................

18 Total expenses. Add lines 13-17 (must equal Part IX, column (A), line 25) .............19 Revenue less exoenses.Subtract line 18 from line 12 ...................................

Sign Signature of officer

Here 'rim Phill President

J V

Time or orint name

Paid Dou1as S. Corey, CPA .Print/Type preparer's name I P or r stature

Dale

/

Check []if

self-emnloved

Preparer Firm's name Douglas Corey & AssociatesUse Only Firm's. address _ 6601 Little River Tr'uplc, Siuite 440 1 Firm's EIN

Alexandria VA 22312-1303 lPhoneno. (703) 354-2900May the IRS discuss this return with the preparer shown above? (see instructions)............ ., J] Yes 1 No

BAA For Paperwork Reduction Act Notice, see the separate instructions. TEEA010I 03125/11 Form 990 (2010)

11,876,490.15,311,533.2,149,592.

Ilflflifl 01 Current Year End of Year

20 Total assets (Part X, line 16).. ....................................... ... ........... ..1!768J 578. 2,875,479.21 Total liabilities (Part X, line 26) ....................................,•,,,,,,,,..••,,,, 3,174,254. 2;131,563.

22 Net assets or fund balances. Subtract line 21 from line 20 .................... ........... .-1,405,676. 743,916.p I Signature Block .

Under penalties of perjury, I declare that I have examined this returnjocludirtg accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, andcomplete. Declaration of preparer (other than officer) a based on all information of which pro parer has any knowledge.

9,202,028.11,767,024.-1,228,283.

Form990201Q , Iinericans for Prosperity Foundation 52-1527294 Page [áftIjk. Statement of Program Service Accomplishments

Check if Schedule 0 contains a response to any question in this Part III .........................................................1 Briefly describe the organization's mission:

Educate businesspersons and consumers to increase awareness of the *and

2 Did the organization undertake any significant program services during the year which were not listed on the priorForm990 or 990-EZ' ........................................................................................ LI Yes NoIt Yes,' describe these new services on Schedule 0.

3 Did the organization cease conducting, or make significant changes in how it conducts, any program services? ..... J Yes NoIf 'Yes,' describe these changes on Schedule 0.

4 Decrlbe the exempt purpose achievements for each of the organization's three largest program services by expenses. Section 501 (c)(3)and 501c4) ôrganfzations and section 4947a(1) trusts are required to report the amount of grants and allocations to others, the totale,cpenses, and revenue, It any, for ea1i program service reported.

4a (Code: _________) (Expenses $ 9, 004, 307. including grants of $0.) (Revenue $ 0,National office -- educate busines Uq^raqjLs_and— consumers to—increase-awareness of the federal aovernment's impact on the o,peratlon and value ----of a -------------------------------------------- ------------------

4b (Code: __________) (Expenses $ 4, 025, 843. including grants of $ 0.) ) (Revenue $ 0.affiliates - educate businesspersons _iea_

S_S it_a_ 9OVerflment 1mact on the operation and value of a free economy. - -__porth Carolina, California, Ohio,

11 iTr^o

2.L hcL gaj Co1orad0 _Qr.2.n4 .. cika.p.L j4_New JerseyL _Fior daL Ge a4S4L York . --------A-rlzc^na, New Hampshire, Arkans^kEs, Maine, Ma.yaQS9ta___

ffiLJQctL

4c (Code: ) (Expenses $ including grants of $ __) (Revenue $)

4d Other program services. (Describe In Schedule 0.)

4eTotalprogramservice 30.15

BAA

TEEA002 rnio&no Form 990

Form 990 (2010) Americans for ProsperitV.. Founda 52-1527294 Page 3

1 Is the organization described in section 501 (c)(3) or 4947(a)(1) (other than a private foundation)? If Yes,' completeScheduleA .........................................................................................................1 X

2 Is the organization required to complete Schedule B, Schedule of Contributors? (see instructions) .........................2 X3 Did the organization engage in direct or Indirect political campaign activities on behalf of or in opposition to candidates

for public office? If 'Yes,' complete Schedule C, Part I .................................................................3

4 Section 501 (cX3) organizations. Did the organization engage in lobbying activities, or have a section 501(h) electionin effect during the tax year? If 'Yes,' complete Schedule C, Part!! .....................................................4 X

5 Is the organization a section 501 (c)(4), 501 (c)(5), or 501 (c)(6) organization that receives membership dues,assessments, or similar amounts as defined In Revenue Procedure 98-19? if 'Yes,' complete Schedule C, Part Iii ..........5

6 Did the organization maintain any donor advised funds or any similar funds or accounts where donors have the right toprovide advice on the distribution or investment of amounts in such funds or accounts? if 'Yes,' complete Schedule D,Part! ..............................................................................................................6

7 Did the organization receive or hold a conservation easement, including easements to preserve open space, theenvironment, historic land areas or historic structures? If 'Yes,' complete Schedule 0, Part ii ..............................7

8 Did the organization maintain collections of works of art, historical treasures, or other similar assets? If 'Yes,'complete Schedule 0, Part ii! .......................................................................................8

9 Did the organization report an amount in Part X, line 21; serve as a custodian for amounts not listed in Part X;or provide credit counseling, debt management, credit repair, or debt negotiation services? If 'Yes,' completeSchedule0, Part IV ............ . ........................... . ......... . ........ . ........ ... ....................... .;. 9

10 Did the organization, directly or through a related organization, hold assets in term, permanent, or quasi-endowments? If'Yes,' complete Schedule 0, Part V ...................................................................................10

11 If the organizations answer to any of the following questions is Yes then complete Schedule D, Parts VI VII VIII, IX,or X as applicable. -

a Did the organization report an amount for land, buildings and equipment in Part X, line 10? If 'Yes,' complete ScheduleD, Part VI ......................................................................................................... ha X

b Did the organization report an amount for investments— other securities in Part X, line 12 that is 5% or more of its totalassets reported in Part X, line 16? If 'Yes,' complete Schedule D, Part VII ............................. ................. 11 b

c Did the organization report an amount for investments— program related in Part X, line 13 that is 5% or more of its totalassets reported in Part X, line 16? If 'Yes,' complete Schedule D, Part VIII ............................................ 11c X

d Did the organization report an amount for other assets in Part X, line 15 that is 5% or more of its total assets reportedin Part X, line 16? If 'Yes,' complete Schedule D, Part IX ..............................................................11 d X

e Did the organization report an amount for other liabilities in Part X, line 25? If 'Yes,' complete Schedule 0, Part X ........ .11 e X

No

X.

X

x

X

f Did the organization's separate or consolidated financial statements for the taxyear include a footnote that addressesthe organization's liability for uncertain tax positions under FIN 48 (ASC 740)? If 'Yes,' complete Schedule 0, Part X ......

12a Did the organization obtain separate, independent audited financial statements for the tax year? If 'Yes,' completeSchedule D, Parts XI, XII, and XIII ..................................................................................

ilfi X

12a1. X

b Was the organization included in consolidated, independent audited financial statements for the tax year? If 'Yes,' andif the organization answered 'No' to line 12a, then completing Schedule 0, Parts XI, XII, and XIII is optional ...............12b

13 Is the organization a school described in section 170(b)(1)(A)(ii)? if 'Yes,' complete Schedule E ...........................13

14a Did the organization maintain an office, employees, or agents outside of the United States? ...............................14a

b Did the organization have aggregate revenues or expenses of more than $10,000 from grantmaking, fundraising,business, and program service activities outside the United States? If 'Yes,' complete Schedule F, Parts land IV ..........14b

15 Did the organization report on Part IX, column (A), line 3, more than $5,000 of grants or assistance to any organizationor entity located outside the United States? If 'Yes,' complete Schedule F, Parts II and IV ................................15

16 Did the organization report on Part IX, column (A), line 3, , more than $5,000 of aggregate grants or assistance toindividuals located outside the United States? If 'Yes,' complete Schedule F, Parts Ii! and IV .............................16

17 Did the organization report a total of more than $15,000 of expenses for professional fundraising services on Part IX,column (A), lines 6 and lie? If 'Yes,' complete Schedule G, Part! (see instructions) .................... 17 X

18 Did the organization report more than $15,000 total of fundraising event gross income and contributions on Part VIII,lines lc and 8a? If 'Yes,' complete Schedule G, Part II ................................................................18

!I19 Did the organization report more than $15,000 of gross income from gaming activities on Part VIII, line 9a? If 'Yes,'

complete Schedule G, Part III ......................................................................................20 a Did the organization operate one or more hospitals? if 'Yes,' complete Schedule H .....................................

b If 'Yes' to line 20a, did the organization attach its audited financial statements to this return? Note. Some Form 990filers that operate one or more hospitals. must attach audited financial statements (see instructioh)

BAA

TEEA0103 12/21/10

19 X20 X

20bi IForm 990 (2010)

Form 990 Americans for tv Foundation 52-1527294 Page 4

I IYesI No

21 Did the organization report more than $5,000 of grants and other assistance to governments and organizations in theUnited States on Part IX, column (A), line 1? If 'Yes,' complete Schedule I, Parts I and!! ................................21 X

22 Did the organization report more than $5,000 of grants and other assistance to individuals in the United States on PartIX, column (A), line 2? If 'Yes,' complete Schedule I, Parts land Ill ....................................................22

23 Did the organization answer 'Yes' to Part VII, Section A, line 3, 4, or 5 about compensation of the organization's currentand former officers, directors, trustees, key employees, and highest compensated employees? If 'Yes,' completeSchedule ........................................................................................................ 23 X

24a Did the organization have a tax-exempt bond issue with an outstanding principal amount of more than $100,000 as ofthe last day of the year, and that was issued after December 31, 2002? If 'Yes,' answer lines 24b through 24d andcomplete Schedule K. If 'No, 'go to line 25 ............................................................................24a

b Did the organization invest any proceeds of tax-exempt bonds beyond a temporary period exception' .....................24b

c Did the organization maintain an escrow account other than a refunding escrow at any time during the year to defeaseanytax-exempt bonds' ..............................................................................................24c

d Did the organization act as an 'on behalf of issuer for bonds outstanding at any time during the year' .....................24d

25a Section 501(cX3) and 501(cX4) organizations. Did the organization engage in an excess benefit transaction with adisqualified person during the year? If 'Yes,' complete Schedule L, Part I ................................................25a

b is the organization aware that it engaged in an excess benefit transaction with a disqualified person in a prior year, andthat the transaction has not been reported on any of the organization's prior Forms 990 or 990-EZ? If 'Yes,' completeScheduleL, Part! .................................................................................................... 25b

Was a loan to or by a current or former officer, director, trustee, key employee, highly compensated employee, ordisqualified person outstanding as of the end of the organization's tax year? If 'Yes,' complete Schedule L, Part!! ........ .26 X

Did the organization provide a grant or other assistance to an officer, director, trustee, key employee, substantialcontributor, or a grant selection committee member, or to a person related to such an individual? If 'Yes,' completeScheduleL, Part Ill .................................................................................................27 X

Was the organization a party to a business transaction with one of the following parties (see Schedule L Part IVinstructions for applicable filing thresholds, conditions, and exceptions): 0

a A current or former officer, director, trustee, or key employee? If 'Yes,' complete Schedule L, Part IV .....................28a X

b A family member of a current or former officer, director, trustee, or key employee? if 'Yes,' completeScheduleL, Part 1V ................................................................................................28b X

c An entity of which a current or former officer, director, trustee, or key employee (or a family member thereof) was anofficer, director, trustee, or direct or indirect owner? If 'Yes,' complete Schedule L, Part IV . .............................. .28c

29 Did the organization receive more than $25,000 in non-cash contributions? If 'Yes,' complete Schedule M .................29

30 Did the organization receive contributions of art, historical treasures, or other similar assets, or qualified conservationcontributions? If 'Yes,' complete Schedule M .........................................................................30

31 Did the organization liquidate, terminate, or dissolve and cease operations? If 'Yes,' complete Schedule N, Part! ......... .31

32 Did the organization sell, exchange, dispose of, or transfer more than 25% of its net assets? If 'Yes,' completeScheduleN, Part!! ..................................................................................................32

33 Did the or own 100% of an entity disregarded as separate from the organization under Regulations sections301.7701-2 and 301.7701-3? If 'Yes,' complete Schedule R, Part I .....................................................33

34 Was the organization related to any tax-exempt or taxable entity? If 'Yes,' complete Schedule R, Parts II, Ill, IV, and V,line .............................................................................................................34

35 Is any related organization a controlled entity within the meaning of section 512(b)(13)? .................................35

a Did the organization receive any payment from or engage in any transaction with a controlled entitywithin the meaning of section 512(b)(13)? If 'Yes,' complete Schedule R, Part V. line 2 ................. DYes No

36 Section 501(cX3 organizations. Did the organization make any transfers to an exempt non-charitable relatedorganization? If Yes,' complete Schedule R, Part V, line 2 ............................................................36

37 Did the organization conduct more than 5% of its activities through an entity that is not a related organization and that istreated as a partnership for federal income tax purposes? If 'Yes,' complete Schedule R, Part VI .........................37

38 Did the organization complete Schedule 0 and provide explanations in Schedule 0 for Part VI, lines 11 and 19?Note. All Form 990 filers are required to comIete Schedule 'O

--. ----------38 1 XBAA Form 990 (2010)

X

X

X

X

26

27

- 28

X

XX

X

X

X

X

X

TEEA0104 12/21110

LOMMMMENONiffimsMME1.01IonNEI

12a

IX

Form 990 (2010) americans for itv Foundati 52-1527294 Pa

Filings and Tax Compliance Check if Schedule 0 contains

to any question in this Part VYes J No

1 a Enter the number reported in Box 3 of Form 1096 Enter 0 if not applicable 1 a 128

b Enter the number of Forms W-2 included in line 1 a Enter 0 if not applicable 1 b 0

C Did the organization comply with backup withholding rules for reportable payments to vendors and reportable gaming(gambling) winnings to prize winners? ...................................................lc X

2a Enter the number of employees reported on Form W-3, Transmittal of Wage and Tax State

ments, filed for the calendar year ending with or within the year covered by this return ........2a 108b If at least one is reported on line 2a, did the organization file all required federal employment tax returns? ................ 2b X

Note. If the sum of lines 1 a and 2a is greater than 250, you may be required to e-file. (see Instructions)3a Did the organization have unrelated business gross Income of $1,000 or more during the year? ..........................

b If Yes' has it filed a Form 990-T for this year? If 'No,' provide an explanation in Schedule 0 ..............................

4a At any time during the calendar year, did the organization have an interest In, or a signature or other authority over, afinancial account in a foreign country (such as a bank account, securities account, or other financial account)? ...........

b If 'Yes, enter the name of the foreign country: '-See instructions for filing requirements for Form 1D F 90-22.1, Report of Foreign Bank and Financial Accounts.

5 a Was the organization a party to a prohibited tax shelter transaction at any time during the tax year? .......... ... ..... .... .kLXb Did any taxable party notify the organization that it was or is a party to a prohibited tax shelter transaction? ..............

c If 'Yes,' to line 5a or 5b, did the organization file Form 8886-1' .......................................................6a Does the organization have annual gross receipts that are normally greater than $100,000, and did the organization

solicit any contributions that were not tax deductible? ..................................................................

b If 'Yes,' did the organization include with every solicitation an express statement that such contributions or gifts werenottax deductible' ................................................................................................... 6b

Organizations that may receive deductible contributions under section 170(c)

a Did the organization receive a payment in excess of $75 made partly as a contribution and partly for goods andservicesprovided to the payor' .....................................................................................

b If 'Yes,' did the organization notify the donor of the value of the goods or services provided' ............................c Did the organization sell, exchange, or otherwise dispose of tangible personal property for which it was required to file

Form8282' ..............................................................................d If 'Yes,' indicate the number of Forms 8282 filed during the year ......,..,..• .... ... ...... ... I 7d1e Did the organization receive any funds, directly or indirectly, to pay premiums on a personal benefit contract' ............

Did the organization, during the year, pay premiums, directly or indirectly, on a personal benefit contract' ................g If the organization received a contribution of qualified intellectual property, did the organization file Form 8899

as required? ..............•...............................................................hi. f the organization received a contribution of cars, boats, airplanes, or other vehicles, did the organization file a

Form1098C? ................................................•.......................................8 Sponsoring organizations maintaining donor advised funds and section 509(aX3) supporting organizations. Did the

supporting organization, or a donor advised fund maintained by a sponsoring organization, have excess businessholdings at any time during the year? ...............................................................................

9 Sponsoring organizations maintaining donor advised funds.a Did the organization make any taxable distributions under section 4966' ................... -............................b Did the organization make a distribution to a donor, donor advisor, or related person? ....,.,. ...........................

10 Section 501(c)(7) organizations. Enter:a Initiation fees and capital contributions included on Part VIII, line 12 ...........................b Gross receipts, included on Form 990, Part VIII, line 12, for public use of club facilities .,,,,, _lOb

11 Section 501(c)(12) organizations. Enter:a Gross income from members or shareholders ...... ......................... ....... ........b Gross income from other sources (Do not net amounts due or paid to other sources

against amounts due or received from them.) ...............................................11 b12a Section 4947(a)(1) non-exempt charitable trusts. Is the organization filing Form 990 in lieu of Form 1041' ...............

b If 'Yes,' enter the amount of tax-exempt interest received or accrued during the year ,,,.,... I 12b113 Section 501 (cX29) qualified nonprofit health insurance issuers.

a Is the organization licensed to issue qualified health plans in more than one state? . • ............................Note. See the instructions for additional information the organization must report on Schedule 0.

b Enter the amount of reserves the organization is required to maintain by the states inwhich the organization is licensed to issue qualified health plans ............................13b

c Enter the amount of reserves on hand ......................................................13c14a Did the organization receive any payments for indoor tanning services during the tax year?

b If 'Yes,' has it filed a Form 720 to report these payments? If 'No,' provide an exblana!ion in Schedule 0

LI.; I:;.

4a IX

5a5b1

X

BAA - TEEA0105 ii,ono Form 990 (2010)

Form 99D2010)Americans for Prosperity . Foundation .52-1527294 PagPad VV^ Governance, Management and Disclosure For each 'Yes' response to lines 2 through 7b below, and for

a 'No' response to line 8a, 8b, or 10b below, describe the circumstances, processes, or changes inSchedule 0. See instructions.Check if Schedule 0 contains a response to any question in this Part VI . .......................................................

1 a Enter the number of voting members of the governing body at the end of the tax year ......b Enter the number of voting members included in line 1 a, above, who are independent .......

2 Did any off ha aicer, director, trustee, or key employee ve family relationship or usa biness relationship with any otherofficer, director, trustee or key employee .................................................................

3 Did the organization delegate control over management duties customarily performed by or under the direct supervision.of officers, directors or trustees, or key employees to a management company or other person? .........................

4 Did the organization make any significant changes to its governing documentssince the prior Form 990 was filed' ..................................................................................

5 Did the organization become aware during the year of a significant diversion of the organization's assets? ..............6 Does the organization have members or ............................................................7a Does the organization have members, stockholders, or other persons who may elect one or more members of the

governingbody' ...................................................................................................b Are any decisions of the governing body subject to approval by members, stockholders or other persons' ...............

8 Did the organization contemporaneously document the meetings held or written actions undertaken during the year bythe following:

aThe governing body' ..............................................................................................b Each committee with authority to act on behalf of the governing body' ...............................................9 Is there any officer, director or trustee, or key ernploy'lite in Part. VII, ction A, wld cannot be reached at the

Oanization's mailino address? If 'Yes,' provide the, name.s and addresses in Schedule 0 ............................action B. Policies. , (This Section B recuests information about on/ides not recruited bv.the Internal Revenue Code.)

lOa Does the organization have local chapters, branches, or affiliates? .................................b If Yes,' does the organization have written policies and procedures governing the activities of such chapters, affiliates,

and branches to ensure their operations are consistent with those of the organization' ..................................11 a Has the organization provided a copy of this Form 990 to all members of its governing body before filing the form' .......

b Describe In Schedule 0 the process, if any, used by the organization to review this Form 990.12a Does the organization have a written conflict of interest policy? If 'No,' go to line 13 ...................................

b Are officers, directors or trustees, and key employees required to disclose annually interests that could give risetoconflicts' ......................................................................................................

c Does the organization regularly and consistently monitor and enforce compliance with the policy? If 'Yes,' describe inSchedule0 how this is done ........................................................................................

13 Does the organization have a written whistleblower policy' ...........................................................14 Does the organization have a written document retention and destruction policy' .......................................15 Did the process for determining compensation of the following persons include a review and approval by independent

persons, comparability data, and contemporaneous substantiation of the deliberation and decision?a The organization's CEO, Executive Director, or top management official ...................................................bOther officers of key employees of the organization ..............................................................

If 'Yes' to line 15a or 15b, describe the process in Schedule 0. (See instructions.)16a Did the organization invest in, contribute assets to, or participate in a joint venture or similar arrangement with a

taxable entity during the year' ....................................................................................b If 'Yes,' has the organization adopted a written policy or procedure requiring the organization to evaluate its

.particiPätion In joint venture arrangements under applicable federal tax law; and taken steps to safeguard theoraanizaion s exemot status with reoect to such

ure

Yes No

X

XX

xX

7a Xlb X

8a XBb

9 X

Yes No

lou l x

lob1:!ijxl

12a X

12b X

12c X13 X14 X

15a X

16a 1 X

16b

17 List the states with which a copy of this Form 990 is required to be filed 1, See Form 990 Page 6, Line 17 (continuedL -, ---. -18 Section 6104 requires an organization to make its Forms 1023 (or 1024 if applicable), 990, and 990-T (501(c)(3)s only) available for public

inspection. Indicate how you make these available. Check all that apply.

LI Own website Another's website V1 Upon request19 Describe in Schedule 0 whether (and if so, how) the organization makes its governing documents, conflict of interest policy, and financial

statements available to the public.20 State the name, physical address, and telephone number of the person who possesses the books and records of the organization:wjht Organization B #350 J-.t.9iL_._ y_21 --. L23!3.29Q

BAA . . . . . Form 990 (2010)

TEEA01 06 03125111

ff11IIIII.Ill'IFff11INN.

0.

0

165, 730.

136, 777,

102, 939.

101,800.

97,247.

34., 542.

33,228.

84.252.

0.

0.

73,152.

18,223.

80,169.

78, 200.

79,754.

72,240.

72,679.

21,423.

0. 0

0. 0

0. .0

G. 0

0.

0.

0.

TEEA0107 12)21110

23, 650..

9,636.

20,605.

10, 580.

10, 296..

21,476.

16,443.

13,699.

Form 990

a

Form 99O(T.0 Americans for Prosperity Fouiiation 52-1527294 Rage PattVll. Compensation of Officers, Directors, Trustees, Key Employees, Highest Compensated Employees,

and Independent ContractorsCheckif Schedule 0 contains a response to any question in this Part VII

Section A. Officers, Directors, Trustees, Key Employees, and Highest Compensated Employees1 a Complete this table for all persons required to be listed. Report compensation for the calendar year ending with or within the

organizations tax year.• List all of the organization's current officers directors, trustees (whether individuals or organizations), regardless of amount of

compensation. Enter -0- in columns (D), (E), and (F) it no compensation was paid.• List all of the organizations current key employees, if any. See instructions for definition of 'key employee.'• List the organization's five current highest compensated employees (other than an officer, director, trustee, or key employee) who

received reportable compensation (Box 5 of Form W.2 and/or Box 7 of Form 1 099 .MISC) of more than $100,000 from the organization and anyrelated organizations.

• List all of the organizations former officers, key employees, and highest compensated employees who received more than $100,000 ofreportable compensation from the organization and any related organizations.\

• List all of the organization's former directors or trustees that received, in the capacity as a former director or trustee of theorganization, more than $10,000 of reportable compensation from the organization and any related organizations.List persons in the following order: Individual trustees or directors; institutional trustees; officers; key employees; highest compensatedemployees; and former such persons.X-1 Check this box if neither the organization nor any related orariization ompens1d an' currentofficer, director, or trustee.

(A) (B) (C) (D) (E) (F)Name and title Average Position (check all that apply) Reportable Estimated

hours - - tcinpensattan'lroni' compensation from amount of otherper week . , g' the crqanzotion, related organizations compensation(describe fi ' . ffq.2j1O99141SC) (W.2/1099.MISC) from thehours forP• . organizationR.related C 5. ,, and relatedorganiza- organizationstionsin - " •n

Schedule a0)

_OLDavid ________Chairman 2.00X

_Dr._Richard Fink_____Director 2.00 X

Vice Chairinan 2.001X- () b GailHumahreIs - -

Direoto. 2.00XL Dr. Walter Williams - -

Director 2.00 XCv NoblesDirector 2.00X

President 18.00LS)onF1,n,n

Exec VP/General Counsel 33.00_________

VP, State Operations 25.00

VP, Policy 25.00_01)_ Steven Lonecran

State Director 25.00-OD-Derrick

State Director 10.00DD-Steve Mullins -

CFO 5.00

•(16)

BAA

52-1527294,ensated Em 11

(E)Reportable

compensatIon irm,etated orgniza1iOns

(W•21lO99Ml5)

8

(F)

Estimatedamount of othercompensation

from theorganizationand related

organizations

Form 990 (2thO) Americans for ProsTerity FoundationPart VIII Section A. Officers, Directors, Trustees, Key Employees, an

(A) I (B) (c) (0)Name and title Average Position (check all that apply) Regef tablehours

i compensation from(decribo (W.ri 94j5C)

the org'nizatlonDus for 0relatedorgani- lzations

IinSchO) I Ilb

(18)

-o--

J9) --- ------.—f-----------

---- --- -------

Q7L------------------------

ibSub-total ........................................... ....................... 756,515. 595,840. 126,385..c Total from continuation sheets to Part VII, Section A -........................ .....____________________________________________d Total (add lines lb and lc) 756f 515.1 595,840.1 126,385.

2 Total number of individuals (including but not limited to those listed above) who received more than $100,000 in reportable compensationfrom the organization 4 -

Yes No

3 Did the organization list any former officer, director or trustee, key employee, or highest compensated employee'on line 1 a? If 'Yes, complete Schedule J for such individual ........................................................... 3 - X

4 For any individual listed on line 1 a Is the sum of reportable compensation and other compensation fromthe organization and related organizations greater than $150,000? If 'Yes' complete Schedule J for . .such individual ............................................................................................. .........4 X -

5 Did any person listed on line la receive or accrUe compensation from: any unrelated organization or individualfor services rendered to the organization? If 'Yes,' complete Schedule 3 for such person

.

5 -action B. Independent Contractors .1Complete this table for your five highest compensated iniependent contractors that received more than $100,000 of

comoensatiort from the oranization.(C)

Compensation

127, 7

(A) (B)Name and business address Description of services

aurPO Box 75021 Baltimore MD 21275 Honoaria

2 Tot& number of independent contractors (including but not limited to those listed above) who received more than1 00.000 in cömoensatiOn from the bcaanization P 1

BAA - TEEA010B 120110 Form 990 (2010)

Form 99O(2010 Americans for Pros.erity Foundation 52-1527294 Page

P.artVHhI Statement of Revenue (A) (B) (C) (D)

Total revenue Related or Unrelated Revenueexempt business excluded from taxfunction revenue under sections

_________________________________ •;: ______________ revenue 512, 513. or 514

la Federated campaigns lab Membership dues lbc Fundraising events ic

tZ d Related organizations 1 de Government grants (contributions) le

All other contributions, gifts, grants, and -. 0 . •'

similar amounts not included above 1 1 16, 922, 075g Noncash contributions included in Ins la if $1, 377 198h Total. Add lines la-if 16,922,075.

Business Code —

2aRegistrat inn fees 900099 467.937. 467,937, 0. 0.bC

d e I Allother program service revenue .....g Total. Add lines 2a-2f ..................................

3 Investment income (including dividends, interest andother similar amounts) ..............................

4 Income from investment of tax-exempt bond proceeds .5 Royalties.____,. ...........

(i) Real (ii) Personal

6a Gross Rents ..........b Less: rental expenses,C Rental income or (loss) . d Net rental income or (loss)............................

7a Gross amount from sales of (i) Securities (ii) Other

assets other than inventory I 1, 356,283.

b Less: cost or other basisand sales expenses .,,. . . . 1,371,969.

c Gain or (loss) .........-15,686.d Net gain or(Ioss) ........... ..............................

8a Gross income from fundraising events(not including. $___________________of contributions reported on line ic).See Part IV, line 18 . ................. a___________

b Less: direct expenses ............... bI____________0 c Net income or (loss) from fundraising events .........

9a Gross income from gaming activities.See Part IV, line 19 .................. a____________

b Less: direct expenses ........... ....b____________c Net income or (loss) from gaming activities ,...........

10a GrossGross sales of inventory, less returnsand allowances a

b Less: cost of goods sold .............. b_____________ ' •.. . 'c Net income or (loss) from sales of inventory

Miscellaneous Revenue Business Code -• 0 - •O'' , -:' o,. .

-

hab Refunds and other,income 900099 1,614. 1,614. 0. 0.C:

d All other revenue ......................eTotal.Addlinesila-lld ............................ 1,614.

— 12 Total revenue. See instructions 17, 4 61, 125. 453, 865. 0. 85,185.BAA TEEA0109 10111110 ' Form 9911 (2010)

cc

0

Iii

ZId

CrIdU>

IdU,

(50ira- 467.937.!J:, .'.. H --H •.

85.185.! 0.1 0.1 85,185.

• 0. - '._ -°-; ............

* .:

- -: •, -•,

..-•':- •;•:; ....-;.

-15,686. . -15,686. . 0. 0;/

'O

.•; •,-.-- .,,- 0' '••0

335,738,1 116,908 132.642.1 86.18

2.459.188

83,598.228,297.200,582.

6,255. 3,411.

18, 967. - 4,527.

127,640. r•-

143,855416.545

394,062.631. 440.

1,767, 887.357, 623.

65,877.3,137.

87,142.204,055.

192,058.469., 947.

1,707., 606.0,

14,308.939.

360,063. 280, 613.

6,510,497. C 389, 556.

253, 300. 242. 300.

-584,175. -137,522.

782,289. 733,609.

748,868. 477, 714.

15,311,533. 13,030.150.

420, 381.

10., 333.29,995.36,865.

21010.. 834,

10, 206.. 4,234,

127, 640.

40,726

15,987.

136,234 76,256.

142, 772, 59,232

115,088. 46,405.

50,330. 9,951.

57,623. 0.

32,804. 18,765.

1,554. 644.

60,997. 18,453.

115,136. 5,05.

11,000. 0.

-312,188. -134,465.

33,752. 14,928.,

140,614. 130,540.

1,302,412. 978,971.

925,922 112,885.

47,902. 25,363.

124, 676. 73,626. 144. 479. 19,238.

Form 990(2f10) americans for Prosperity Foundation 52-1527294 Page 10Part IX Statement of Functional Expenses

Section 501(c) (3) and 501(c) (4) organizations must complete all columns.All other organizations must complete column (A) but are not required to complete columns (B), (C), and (D).

(A) (B) (C)(D)Do not !nctudeamoun& reported on lines Total expenses Program service Management and Fundraising64 7b, Sb; 9b,and lob of Part Viii expenses general expenses expenses

1 Grants and other assistance to governmentsand organizations in the U.S. See Part IV,line21 ............................... ........ ._______________

2 Grants and other assistance to individuals In -the U.S. See Part IV, line 22 ................ .__________________Grants and other assistance to nnvrrtm,nIc .

organizations, and 'individuals outside theU.S. See Part IV, lines 15 and 16 .............

4 Benefits paid to or for members ............5 Compensation of current officers, directors,

trustees, and key employees ................6 Compensation not included above, to

disqualified persons (as defined undersection 4953(0(1)) and persons describedin section 4958(c)(3)(B) .....................

7 Other salaries and wages ...................8 Pension plan contributions (include

section 401(k) and section 403(b)employer contributions) ....................

9 Other employee benefits ....................10 Payroll taxes .................................11 Fees for services (non-employees):

a Management ................................bLegal..........................................cAccountirig ..................................dLobbying...................................e Professional fundraising services. See Part IV, line 17 .....

Investment management fees ...............gOther.....................................

12 Advertising and promotion ...................13 Office expenses .............................14 Information technology ......................15 Royalties16 Occupancy ..................................17 Travel .......................................18 Payments of travel or entertainment

expenses for any federal, state, or localpublic officials . ..............................

19 Conferences, conventions, and meetings20 Interest ...............................21 Payments to affiliates ........................22 Depreciation, depletion, and amortization .....23 Insurance .....................................24 Other expenses. Itemize expenses not

covered above (List miscellaneous expensesin line 24f. If line 24f amount exceeds 10%of line 25, column (A) amount, list line 24fexpenses on Schedule 0.) ....................

aProffees- consultinSbConunuñIcatlons ads, mediac Honorariad Overhead allocated to affiliatee ContractorsfAll other expenses,., ....

25 Total functional ekp.enês. Add lines 1 through 24f26 Joint costs. Check here ' if following

SOP 98-2 (ASO 958-72. Complete This lineonly if the organization reported in column(B) joint costs from a combined educationalcampaign and fundraising solicitatiorr

BAA74,411. 52,088

0.1 22,323.

1EEA0110 12121110

Form9902010) Americans for Prosperity Foundation 52-1527294 Pagell

(A) (B)Beginning of year End of year

1 Cash - non-interest-bearing ...................................................304, 585. 1 652,404.2 Savings and temporary cash investments... , ......... I ........ I .......... 23 Pledges and grants receivable, net ..................................... ..........122,795. 3 . 254, 911.4 Accounts receivable, net .........................................................59, 281. 4 56, 626.

5 Receivables from current and former officers, directors, trustees, key employees, - - - - -and highest compensated employees. Complete Part II of Schedule L ............. .___________________ 5

6 Receivables from other disqualified persons (as defined under section 4958(0(1)), . .. - .persons described in section 4958(c)(3)(B), and contributing employers andsponsoring organizations of section 501 (c)(9) voluntary employees' beneficiary -

A organizations (see instructions) ..................... ................... . ......... .____________________ 6

7 Notes and loans receivable, net ....... .... 979, 680. 7 1685,860.E 8 Inventories for sale or use ............ ..................... .......... .............. 8T -

S 9 Prepaid expenses and deterred charges ........................35, 471. 9 37,-403.

lOa Land, buildings, and equipment: cost or other basis ..Complete Part VI of Schedule D .....................ba 287,364.

b Less: accumulated depreciation ......................lOb 216,, 428. 130,214. lOc 70, 936.11 Investments - publicly traded securities .... ......... . S.,

12 Investments - other securities. See Part IV, line 11 ,,......,..,.,.... . ....... 12 13 Investments - program-related. See Part IV, line 11 ................................ 14 Intangible assets ............................................ ........... V .-.... 14

15 Other assets. See Part IV, line 11 ...............................................136, 552. 15 117, 339.- 16 Total assets. Add lines 1 thcugh 15 (rnut equal line a4) 1,768,578. 16 2,875,479.

17 Accounts payable and accrued expenses ...... ...........................361, 319. 17 . 549, 368...18 Grants payable ............ 18

19 Deferred revenue ............................... ........................... ....... 1920 Tax-exempt bond liabilities ................................................. ,.-.. 2021 Escrow or custodial account liability. Complete Part IV of Schedule D ........ .... 21

L 22 Payables to current and former officers, directors, trustees, key employees,highest compensated employees, and disqualified persons. Complete Part II ..ofSchedule L ........................................... . ............... ........________________ 22

23 Secured mortgages and notes payable to unrelated third parties ..................-. 2324 Unsecured notes and loans payable to unrelated third parties ................S 24

25 Other liabilities. Complete Part of Schedule ....................................2, 812, 935. 25 1,582,195.26 Total liabilities. Add lines 17 throu gh 25 3,174,254. 26 2,131,563.

Organizations that follow SFAS 117, check here J and complete lines . .. . V

T 27 through 29 and lines 33 and 34.

27 Unrestricted net assets . ......................... ......... ...................... .- 1, 916, 290. 27 —523,210.

.28 Temporarily restricted net assets ............................ ....................... .510,614. 28 1,267,126.S 29 Permanently restricted net assets ......................... .

Organizations that do not follow SFAS 117, check here "- and completelines 30 through 34.

30 Capital stock or trust principal, or current funds ............................... . ...... 3031 Paid-in or capital surplus, or land, building, or equipment fund ,....,- .... '...... 31

32 Retained earnings, endowment, accumulated income, or other funds ......... ...... .__________________ 32 5

33 Total net assets or fund balances . .............. . ............................ .... — 1, 405, 67 6 .1 33 743.916..S 34 -Total liabilities and net assets/fund balances . ....................... .................1,768,578. 1 34 1 2, 875, 479.

BAA - V . Form 990 (2010

TEEA0111 12/21110

Form 99O(2010) Americans for Proserity Foundation 52-1527294 Page 12

I Part xE.I Reconciliation of Net AssetsCheck if Schedule. 0 contains a response to any question in this Part XI

1 Total revenue (must equal Part VIII, column (A), line 12) ....................................................2 Total expenses (must equal Part IX, column (A), line 25) ..................................................3 Revenue less expenses. Subtract line 2 from line 1 .........................................................4 Net assets or fund balances at beginning of year (must equal Part X, line 33, column (A)) .....................5 Other changes in net assets or fund balances (explain in Schedule 0) .......................................6 Net assets or fund balances at end of year. Combine lines 3, 4, and 5 (must equal Part X, line 33,

column 63)) ..............................

17, 461, 125.15,3111.533.2,149,592.

-1, 405676.

6.

in this Part XII . ...... jjYes I

1 Accounting method used to prepare the Form 990: Cash jJ Accrual Other

If the organization changed its method of accounting from a prior year or checked 'Other,' explainin Schedule 0.

2a Were the organization's financial statements compiled or reviewed by an independent accountant' ........................2a - Xb Were the organization's financial statements audited by an independent ................................... 2b X -

c If 'Yes' to line 2a or 2b, does the organization have a committee that assumes responsibility for oversight of the audit,review, or compilation of its financial statements and selection of an independent accountant' ...........................2c - XIf the organization changed either its oversight process or selection process during the tax year, explain .in Schedule 0. ..,.

d If 'Yes' to line 2a or 2b, check a box below to indicate whether the financial statements for the year were issued on aseparate basis, consolidated basis, or both: ......... ......- ...............JJ Separate basis J Consolidated basis Both consoIidated and separate basis .

3a As a result of a federal award, was the organization required to undergo an audit or audits as set forth in the SingleAudit Act and OMB Circular A - 133' ................................................................................. 3a - X

b If Yes,' did the organ1ztion undergb the required audit or audits? If the oyganization did not undergo the required auditor audits explain why in Schedule 0 and describe any , steps taken to undergo such audits 3b - -

BAA . Form 990 (2010)

Check if Schedule 0 contains a response to

TEEA0I12 12/21110

014B No. 1545.0047

Public Charity Status and Public Support I 2010Complete if the organization is a section 501 (cX3) organization or a section

4947(aXi) nonexempt charitable trust. Open to PublicAttach to Form 990 or Form 990 EZ. ' See separate instructions.Inspection

Employer Identification number

itv Foundation 152-1527294ons must

S.

SCHEDULE A(Form 990 or 990-EZ)

Department of the TreasuryInternal Revenue Service

Name of the organization

Americans for ProPàtI:I Reason for Pu

The irganization is not a private foundation because it is: (For lines 1 through 11, check only one box.)1 A church, convention of churches or association of churches described in section 170(b)(1XAXi)I.2 A school described in section 170(bX1XAXii). (Attach Schedule E.)3 A hospital or a cooperative hospital service organization described in section 170(bXlXAXiii).

4 A medical research organization operated in conjunction with a hospital described in section 170(bXlXAXiii). Enter the hospital'sname, city, and state ----

U An organization operated for thebenefit of a college or university ovned or operated by a governmental unit described in section170(bX1XAXiv). (Complete Part II.)

6 A federal, state, or local government or governmental unit described in section 170(b)(1XAXv).7 x An organization that normally receives a substantial part of its support from a governmental unit or from the general public described

in section 170(bX1XAXvI). (Complete Part II.)8 II A community trust described in section 170(b)(1XAXvI). (Complete Part Il.)9 j An organization that normally receives: (1) more than 33-1/3% of its support from contributions, membership fees, and gross receipts

from activities related to its exempt functions — subject to certain exceptions, and (2) no more than 33-1/3% of its support from grossinvestment income and unrelated business taxable income (less section 511 tax) from businesses acquired by the organization afterJune 30, 1975. See section 509(aX2). (Complete Part Ill.)

10 An organization organized and operated exclusively to test for public safety. See section 509(aX4).11 An organization organized and operated exclusively for the benefit of, to perform the functions of, or carry out the purposes of one or

more publicly supported organizations described in section 509(a)(1) or section 509(a)(2). See section 509(a)(3). Check the box thatdescribes the type of supporting organization and complete lines lie through ilh.a Type I b []Type II c U Type Ill — Functionally integrated d Type Ill — Other

e LI By checking this box, I certify that the organization is not controlled directly or indirectly by one or more disqualified personsother than foundation managers and other than one or more publicly supported organizations described In section 509(a)(1) orsection 509(a) (2).

If If the organization received a written determination from the IRS that is a Type I, Type II or Type Ill supporting organization,checkthis box .............................................................................................................

g Since August 17, 2006, has the organization accepted any gift or contribution from any of the following persons?[Yes No

(i) A person who directly or indirectly controls, either alone or together with persons described in (ii) and (iii)below, the governing body of the supported organization? .................................................11 g (i)

(ii) A family member of a person described in (i) above? ................................................. 11 g cii)(iii) A 35% controlled entity of a person described in (i) or (ii) above' .........................................11 g çiii)

h Provide the followina information about the sUorted orqniialidh(s)(I) Name of supported (ii) EIN (iii) Type of organization (iv) is the Did you notify (vi) Is the (vii) Amount of support

organization (described on lines 1-9 organization In ornization inorganization in

above or 1RC section column (I) listed in column(I)ofcolumn (1)(seeInstructions)) your governing our support?organized In the

document? U.S.?

Yes I No I Yes I No I Yes I No

Total• .:

H... .• -. .BAA For Paperwork Reduction Act Notice, seethe Instructions for Form 990 or 990-EZ. Schedule A (Form 990 or 990 . EZ) 2010

TEEAO4O1 12123110

Schedule A (Form 990 or 99O .EZ) 2010 Americans for Prosperity Foundation 52-1527294 Page 2Part :llSupport Schedule for Organizations Described in Sections 170(b)(1)(A)(iv) and 170(b)(1)(AXvi)

(Complete only if you checked the box on line 5, 7, or 8 of Part I or if the organization failed to qualify under Part Ill. If theorganization fails to qualify under the tests listed below, please complete Part Ill.)

Calendar year (or fiscal year (a) 2006 b2007 (c) 2008 (d) 2009 (e) 2010 (U Totalbeginning in)1 Gifts, grants, contributions, and .

membership fees received. ^Donot include 'unusual gran

s 3,954,449. 5,476,046. 7,500,059. 10,375,217. 16,922,075.. 44,227,8464

2 Tax revenues levied for theorganizations benefit andeitherpaid to it or expendedon its behalf ...................______________

3 The value of services orfacilities furnished by agovernmental unit to theorgan ization without charge

4 Total. Add lines l through 3... 3,954,449. 5.476,046. 7 1 500 1 059. 10,375,217.16,922,075. 44,227,846.5 The portion of total . . . ..

contributions by each person(other than a governmental -unit or publicly supportedorganization) included on line 1 .that exceeds 2% of the amountshown online 11, column (f) ... . - . - -: 13, 886, 876.

6 Public support. Subtract line 5 .. .. jfrom line 4 .............. .....-. . .- .. : 30,340,970.

Calendar year (or fiscal year (a) 2006 I (b) 2007 I (c) 2008 (d) 2009beginning in) 7 Amounts from line 4 ........... .3,954449.ft476t046.(2500059. 10,375,217.

(e)2010 (f)Total

16,922,075. 44,227,846.,

8 Gross income from interest,dividends, payments receivedon securities loans, rents,royalties and income fromsimilar sources ................. .268,769. 206,656. 247,919. 236,580. 85,185. 1,045109.

9 Net income from unrelatedbusiness activities, whether ornot the business is regularlycarried on .................... .______________

10 Other income. Do not includegain orloss from the sale ofcapital assets (Explain inPart IV.) .......................0. 4,537. 971. 189,053. 469,584. 664,145,

11 Total support. Add lines 7through 10 ........................ - r - ' __________ 45,937,100...

12 Gross receipts from related activities, etc (see instructions)....................................________________

13 First five years. If the Form 990 is for the organization's first, second, third, fourth, or fifth tax year as a section 501 (c)(3)organization, check this box and stop here ................................... ............................................. . .. . fl

ection C. Computation of Public Support Percentage 14 Public support percentage for 2010 (line 6, column (f) divided by line 11, column (f)) , ............................... ..14 66.05%

15 Public support percentage from 2009 Schedule A, Part II, line 14 ...................... • 15 67 . 36%

16a 33-.113% support test —2010. If the organization did not check the box online 13, and the line 14 is 33-1/3% or more, check this boxand stop here. The organization qualifies as a publicly supported organization ....................................................

b 33-113% support test —2009. If the organization did not check a box on line 13 or 16a, and line 15 is 33-1/3% or more, check this boxand stop here. The organization qualifies as a publicly supported organization .................................................... 0

17a 10%-facts-and-circumstances test - 2010. If the organization did not check a box on line 13. 16a, or 16b, and line 14 Is 10%or more, and if the organization meets the 'facts-and-circumstances' test, check this box and stop here. Explain in Part IV howthe organization meets the 'facts-and-circumstances' test The organization qualifies as a publicly supported organization ............ fl

b 10%-facts-and-circumstances test —2009. If the organization did not check a box on line 13, 1 6a, 16b, or 17a, and line 15 is 10%or more, and if the organization meets the 'facts-and-circumstances' test, check this box and stop here. Explain in Part IV how theorganization meets the 'facts-and-circumstances' test. The organization qualifies as a publicly supported organization ..............

18 Private foundation. If the organization did not check a box on line 13, 16a, 16b, 17a, or 17b, check this box and see instructions .....BAA Schedule A (Form 990 or 990-EZ) 2010

TEEAO402 12123/10

Schedule A (Form 990 or 990-EZ 2010 .. Americans for Prosperity Foundation 52-1527294 Pàge3

I Part 01. --, Support Schedule for Organizations Described in Section 509(a)(2)(Complete only if you checked the box on line 9 of Part I or if the organization failed to qualify under Part II. If the organization failsto qualify under the tests listed below, please complete Part II.)

Calendar year (or fiscal yr beginning in)1Gifts.-grants, contributions

and :membership leesreceived. (Do not includeany unusual grants.)

2 Gross receipts from admis-sions, merchandise sold orservices performed, or facilitiesfurnished in any, activity that isrelated to the organization'stax-exempt purpose ...........

3 Gross receipts from activitiesthat are not an unrelated tradeor business under section 513

4 Tax revenues levied for theorganization's benefit andeither paid to or expended onits behalf ....................

5 The value of services orfacilities furnished by agovernmental unit to theorganization without charge

6 Total. Add lines 1 through 5.7a Amounts included on lines 1,

2, and 3 received fromdisqualified persons............

b Amounts included on lines 2and 3 received from other thandisqualified persons thatexceed the greater of $5,000 or1% of the amount on line 13for the year ...................

c Add lines 7a and 7b ...........8 Public support (Subtract line

7c from line 6.)Section B. Total SupportCalendar year (or fiscal yr beginning in) - (o)2006

9 Amounts from line 6 ...........a Gross income from interest,

dividends, payments receivedon securities loans, rents,royalties and income fromsimilar sources ............... . .__________

b Unrelated business taxableincome (less section 511taxes) from businessesacquired after June 30, 1975

c Add lines l0a and l0b ....... ... .________

11 Net income from unrelated businessactivities not included in line lOb,whether or not the business isregularly carried on ...............

12 Other income. Do not includegain or loss from the sale ofcapital assets (Explain inPart IV.) .......................________

13 Total support. (Add Ins 9,1Cc, 11, and 12.)

14 First (ivevears. If the Form 990 . is for the orq

2010 I (fiTotal

2007 I (02008

2009 I (e2010 I (f)Total

on's first, second, third, fourth, , or fifth tax year a^-a . section 501 °?!S ............... n

2006

2009

55

:

15 Public support percentage for 2010 (line 8, column (f) divided byline 13, column (f)) .............................16 Public su000rt oercenta're from 2009 Schedule A. Part Ill, line 15...................................................

17 Investment income percentage for 2010 (line lOc, column (f) divided by line 13, column (1) .:. . ................ 1718 Investment income percentage from 2009 Schedule A, Part Ill, line 17 .......................... ...................1819a 33-113% support tests —2010. If the organization did not check the box online 14, and line 15 is more than 33-113%, and line 17

is not more than 33-1/3%, check this box and stop here. The organization qualifies as a publicly supported organization .......... ,... LIb 33-113% support tests —2009. If the organization did not check a box on line 14 or line 19a, and line 16 is more than 33-1/3%, and

line 18 is not more than 33-1/3%, check this box and stop here. The organization qualifies as a publicly supported organization ......20 Private foundation If the organization did not check a box on line 14, 19a or 19b check this box and see instructions

BAA TEEA0403 12/110 Schedule A (Form 990 or 990-EZ) 2010

Schedule A(Form 990 or 990.EZ) 2010 Americans for Prosperity. Foundation 52-1527294 Page

I P.ã1t1V Supplemental Information. Complete this part to provide the explanations required by Part II, line 10;Part II, line 17a or 17b; and Part Ill, line 12. Also complete this part for any additional information.(See instructions).

Other ----------------------------------------------------------

Description: Other income --------------

2006: 0.. - -------------------_.......... ---------- -

2007: 4537.

2008: 971.

2009: 73712.

20.10.: - 1617. . .. .

. ----.-.--------2009: 115341.

2010: 467967. . . .

---------------------------------- ---------------------------------

BAA . Schedule A (Form 990 or 990-EZ) 2010

TEEA0404 09108110

.'I

(a) Name

(1)

(2)

(3)

(4)

(5)

(6)

(c) EIN (d) Amount paid from tiling (8) Amount of political

organizations funds. contributions received and

if none, enter-O.. promptly and directlydelivered to a separatepolitical organization.

If none, enter -0-.

(b) Address

SCHEDULE C(Form 990 or 990-EZ)

Department of the TreasuryInternal Revenue Service

Political Campaign and Lobbying ActivitiesFor Organizations Exempt From Income Tax Under section 501(c) and section 527

Complete if the organization is described below.Attach to Form 990 or Form 990-a. See separate Instructions.

OMB No. 1515-0047

2010C

lithe organization answered 'Yes,' to Form 990, Part IV, line 3, or Form 990EZ, Part V, line 46 (Political Campaign Activities), then• Section 501 (c)(3) organizations: Complete Parts I-A and B. Do not complete Part I-C.• Section 501(c) (other than section 501(c)(3)) organizations: Complete Parts I-A and C below. Do not complete Part I-B.• Section 527 organizations: Complete Part l .A only.

If the organization answered 'Yes,' to Form 990, Part IV, line 4, or Form 990-EZ Part VI, line 47 (Lobbying Activities), then• Section 501(c)(3) organizations that have filed Form 5768 (election under section 501(h)): Complete Part Il-A. Do not complete Part li-B,• Section 501 (c)(3) organizations that have NOT filed Form 5768 (election under section 501(h)): Complete Part li-B. Do not complete

Part H-A.If the organization answered 'Yes,' to Form 990, Part IV, line 5 (Proxy Tax) or Form 990-EZ, Part V, line 35a (Proxy Tax), then

• Section 5010(4)' , (5), or (6) or92iiizations:CompIete Part Ill.Name of organization Employer identification number

,-,, s.4al-4 -, 521527294I Part l-AI Complete if the organization is exempt under section 501(c) or is a section tL/ organization.

1 Provide a description of the organization's direct and indirect political campaign activities in Part IV.2 Political expenditures .............................................................................. ' $.. 0.3 Volunteer hours . 0

.1 PàrtiB' I Complete if the organization is exempt under section 501 (c)(3).1 Enter the amount of any excise tax incurred by the organization under section 4955 ...............,,....,...., ' $ 0.2 Enter the amount of any excise tax incurred by organization managers under section 4955 ...................... $ 0.3 If the organization incurred a section 4955 tax, did it file Form 4720 for this year? ......... ............................... Yes No

4a Was a correction made? ..... ........................................................................................- Yes No

b If Y;' describe in Part IV.Pairt if the organization is exempt under section 501(c) except section 5Qt(c)(3).

1 Enter the amount directly expended by the filing organization for section 527 exempt function activities ..........• $___________________

2 Enter the amount of the filing organizations funds contributed to other organizations for section 527 exemptfunction activities .............................................. $_____________________

3 Total exempt function expenditures. Add lines 1 and 2. Enter here and on Form 1 120-POL,line 17b .....................______

4 Did the filing organization file Form 1120-POL for this year? ....................................- . ....................... Yes No

5 Enter the names, addresses and employer identitcationnombr ElN) of all section 527 political organizations to which the filingorganization made payments For each organization listed the amount paid from the filing organization's funds Also enter theamount of political contributions received that were promptly and directly delivered to 'a separate political organization such as a separate

pnrrvnoth'rf fi,h1 nr nolltiri ciiñ cnnimitteë (PAC1 if additioñàl soace is needed. orovide information, in Part IV.

BAA For Paperwork Reduction Act Notice, see the instructions for Form 990 or 990-EZ. Schedule C (Form 990 or 990-EZ) 2010

I')—'lJI,1.J111

Schedule C (Farm 990 or 990-EZ) 2010 Americans for Prosperity Foundation 52-1527294 Page 2Part i1=AJ Complete if the organization is exempt under section 501(cx3) and filed Form 5768 (election under

section 501(h)).A Check ^ if the filing organization belongs to an affiliated group.B Check ^ if the filingg or anization checked box A. and 'limited control'. provisions apply.

Limits on Lobbying Expenditures (a) filing (b) Affiliated(The term 'expenditures' means amounts paid or incurred.) organ'ization's totals group totals

1 a Total lobbying expenditures to influence public opinion (grass roots lobbying) ............... 0.b Total lobbying expenditures to influence a legislative body (direct lobbying) :.:. . . . .......... 0 .c Total lobbying expenditures (add lines 1a and 1 b) ......................................:. 0 .dOther exempt purpose expenditures ........................................ —........ 0 .e Total exempt purpose expenditures (add lines lc and 1d) .................................. 0 ,

f Lobbying nontaxable amount. Enter the amount from the following table inboth columns. 0.If the amount on line le, column (a) or (b) is: The lobbying nontaxable amount is: g" Not over $500,000 20% of the amount on line le. -t

Over $500,000 but not over $1,000,000 $100,000 plus 15% of the excess over $500,000.Over $1000,000 but not over $1,500,000 $175,000 plus 10% of the excess over $1,000,000.Over $1,500,000 but not over $17,000,000 $225,000 plus 5% of the excess over $1,500,000.Over $17,000,000 $1,000,000.

g Grassroots nontaxable amount (enter 25% of line if) .,,,,. :...............................'.. 0•,h Subtract line 1 g from line la. If zero or less, enter -0................. .... . .............. . .., ......... . 0.i Subtract line if from line i c. If zero or less, enter -0- ...... , ; .. .. . . ... . . ................... 0 .

j If there is an amount other than zero on either line 1 h or line ii, did the organization file Form 4720 reportingsection 4911 tax for this year? n Yes n No

4-Year Averaging Period Under Section 501(h)(Some organizations that made a section'501(h) election do not have , to complete all of the five

columns below. See the. instructions for lir es2a through 2f.)

4-Year Averagiria Period

(a) 2007 I (b) 2008 1 (c) 2009 1 (d) 2010

2a Lobbying non-taxableamount ...........

b Lobbying ceiling amount (150% of line .2a. column (e)) ....._. ...

Calendar year (or fiscalyear beginning in) (e) Total

}

c Total lobbyingexpenditures .

d Grassroots nontaxableamount .............

e

f Grassroots lobbyingexpenditures

BAA Schedule C (Form 990 or 990-EZ) 2010

TEEA3202 10/11/10

Schedule C(Form 990 or990.EZ) 2010 Americans for Prosçerity Foundation 52-1527294 Page 3I Part Il-B. I Complete if the organization is exempt under section 501(c)(3) and has NOT tiled Form 5768

(election under section 501(h)).

Yes I No I Amount

1 During the year, did the filing organization attempt to influence foreign, national, state or locallegislation, including any attempt to influence public opinion on a legislative matter or referendum,through the use of:

aVolunteers,? ........................................................................................b Paid staff or management (include compensation in expenses reported on lines lc through ii)' .........cMedia advertisements? ...............................................................................d Mailings to members, legislators, or the public' ........................................................e Publications, or published or broadcast statements? ..................................................

Grantsto other organizations for lobbying purposes' ................................................g Direct contact with legislators, their staffs, government officials, or a legislative body' .............h Rallies, demonstrations, seminars, conventions, speeches, lectures, or any similar means? .....i Other activities? If 'Yes,' describe in Part IV ...........................................................

Total. Add lines I through .........................................................................2a Did the activities in line 1 cause the organization to be not described in section 501(c)(3)' ..............

b If 'Yes,' enter the amount of any tax incurred under section 4912 .......................................c If 'Yes,' enter the amount of any tax incurred by organization managers under section 4912 ..... -d If the filing organization incurred a section 4912 -tax, did it file Form 4720 for this year?..................rt ill A Complete if the organization is exempt under section 01(c)(4), section 501 (cX5), or

section 501(c)(6).

I.

No1 Were substantially all (90% or more) dues received nondeductible by members? ...................................2 Did the organization make only in-house lobbying expenditures of $2,000 or ,.,.............................3 Did the organization agree to carryoveHabbyino and political expenditures from the prior year' ......... ..........:art lItB '-I Complete if the organization is exempt under.section 501 (cX4), section 501 (cX5), or

section 501 (cX6) if BOTH Part Ill-A, lines 1 and 2 are answered 'No' OR if Part Ill-A, line 3is answered 'Yes.'

1 Dues, assessments and similar amounts from members ............................... ................

.-. i,,., 12 Section 162(e) nondeductible lobbying and political expenditures (do not include amounts of political

expenses for which the section 527(1) tax was paid).aCurrent year ...............................................................................................2abCarryover from last year .................................................................................. 2I

cTotal....................................................................................................... 2c

3 Aggregate amount reported in section 6033(e)(1)(A) notices of nondeductible section 162(e) dues ............... 3

4 If notices were sent and the amount on line 2c exceeds the amount on line 3, what portion of the excessdoes the organization agree to carryover to the reasonable estimate of nondeductible lobbying and political

expenditurenext year? ................................................................................... 45- Taxable amount of lobbying, and political expenditures (seinstructiors -............................. . •. ........5

Complete this part to provide the descriptions required for Part I-A, line 1; Part I-B, line 4; Part I-C, line 5; and Part Il-B, line ii.Also, complete this part for any additional information. - -

Pt I-A Line 1 - None in 2010.

BAA Schedule C (Form 990 or 990-EZ) 20101EEA3203 10111/10

Schedule C (Vorm 990 or 990-EZ) 2010 P2iaericans for Prosperity Foundat

52-1527294

--

BAA Schedule C (Form 990 or 990-EZ) 2010

TEEA3204 0111I10

Supplemental Financial StatementsComplete If the organizatio.n answered 'Yes,' to Form 990,

Part IV, lines 6,7,8,9,10,11, or 12.- Attach to Form 990. 0, See separate instructions.

SCHEDULE D(Form 990)

Department of the Treasuryinternal Revenue ServiceName olthoorganiatlon

Americans for Prosperit

Part I:j Organizations Maintaithe oraanization answt

L)onor Auvlsea FUncts or otner'Yes' to Form 990, Part IV, line 6.

Donor advised funds

01MB No. 1545-0047

2010Open toPüblict'lnspectión

Employer identification number

52-1527294or Accounts. Complete if

(b) Funds and other accounts1 Total number at end of year .................2 Aggregate contributions to (during year)3 Aggregate grants from (during year) .........4 Aggregate value at end of year ...........

5 Did the organization inform all donors and donor advisors in writing that the assets held in donor advisedfunds are the organizations property, subject to the organizations exclusive legal control ? .......................Yes

6 Did the organization inform all grantees, donors, and donor advisors in writing that grant funds can beused only for charitable purposes and not for the benefit of the donor or donor advisor, or for any otherpurpose conferring impermissible private benefit ? ....................................................• .......... Yes

art ,111 Iconservation Easements. Complete it the organization answered 'Yes' to 1-orm 9U, I-art IV,, line I..1 Purpose(s) of conservation easements held by the organization (check all that apply).

Preservation of land for public use (e.g., recreation or education) Preservation of an historically important land areaProtection of natural habitat HPreservation of a certified historic structurePreservation of open space

2 Complete lines 2a through 2d If the organization held a qualified conservation contribution in the form of a conservation easement on thelast ay.of the tax year..

Held at the End of the Tax Yeara Total number of conservation easements ....................................................b Total acreage restricted by conservation easements.......................................... 2bc Number of conservation easements on a certified historic structure included in (a) ............... 2c

d Number of conservation easements Included in (c) acquired after 8/17106, and not on a historicstructure listed in the National Register -------------------------------------------------------- 2d

3 Number of conservation easements modified, transferred, released, extinguished, or terminated by the organization during thetax year '-______________

4 Number of states where property subject to conservation easement is located -

El No

No

5 Does the organization have a written policy regarding the periodic monitoring, inspection, handling of violations,and enforcement of the conservation easements it holds ? ......................................................Yes

6 Staff and volunteer hours devoted to monitoring, inspecting, and enforcing conservation easements during the year

7 Amount of expenses incurred in monitoring, inspecting, and enforcing conservation easements during the year

8 Does each conservation easement reported on line 2(d) above satisfy the requirements of section170(h)4)(13)(1) and section 170(h)4)(B)(ii)' ................................................................ .. - Yes

flNo

No9 In Part XIV, describe how the organization reports conservation easements in its revenue and expense statement, and balance sheet, and

include, if applicable, the text of the footnote to the organization's financial statements that describes the organization's accounting forconservation easements.

.lPa-tiIlj Organizations Maintaining Collections of Art, Historical Treasures, or Other Similar Assets.Complete if the organization answered 'Yes' to Form 990, Part IV, line 8.

1 a If the organization elected, as permitted under SFAS 116 (ASC 958), not to report In its revenue statement and balance sheet works ofart, historical treasures, or other similar assets held for public exhibition, education, or research in furtherance of public service, provide,in Part XIV, the text of the footnote to its financial statements that describes these items.

b If the organization elected, as permitted under SFAS 116 (ASC 958), to report In its revenue statement and balance sheet works of art,historical treasures, or other similar assets held for public exhibition, education, or research in furtherance of public service, provide thefollowing amounts relating to these items:(I) Revenues included in Form 990, Part VIII, line 1 ,..,,,....., , ............................................. $_____________________(ii) Assets included in Form 990, Part X ........................................................ ..•,.. b. $

2 If the organization received or held works of art, historical treasures, or other similar assets for financial gain, provide the followingamounts required to be reported under SFAS 116 (ASC 958) relating to these items:

a Revenues Included in Form 990, Part VIII, line 1.,,,.,....................................................••.,..,.. b Assets included in Form 990,,Part X ............................................................................ $

BAA For Paperwork Reduction Act Notice, seethe instructions for Form 990. 1EEA3301 11/15110 Schedule D (Form 990) 2010

Schedule (Form90)2010 Americans for Prosperity Foundation 52-1527294 Paqe2

3 Using the organization's acquisition, accession, and other records, check any of the following that are a significant use of its collectionItems (check all that apply):

a Public exhibition dLoan or exchange programsb Scholarly research e OtherC Preservation for future generations

4 Provide a description of the organization's collections and explain how they further the organization's exempt purpose inPart XIV.

5 During the year, did the organization soliàit or receive donations of art, historical treasures, or other similarassets to be sold to raise funds rather than to be maintained as part of the organization's .. fl Yes fl No

art IV I Escrow and Custodial Arrangements.. Complete if organization answered Yes' to Form 990, Part IV, line9, or reported an àmouriton Form 990, Part X, line 21.

1 a Is the organization an agent, trustee, custodian, or other intermediary for contributions or other assets notincluded on Form 990, Part X' ................... .. ....................................... ................. ......JJ Yes No

bIf 'Yes,' explain the arrangement in Part XIV and complete the following table: Amount

cBeginning balance ............................................................................ICd Additions during the year, ......................................... 1 de Distributions during the year . ., ..........................,.,.,..,.., 1 e

Endingbalance ......................... ............................................, if2a Did the organization include an amount on Form 990, Part X, line 21' ............................................ Yes No

b_If_'Yes,'_ explain _the _arrangement _in_ Part _XIV.artVI Endowment Funds, Complete if the or anization answered 'Yes' to Form 990, Part IV, line 10.

(a) Current year (b) Prior year (c) Two years back (d) Three years back (e) Four years back

1 a Beginning of year balance,.,,,.b Contributions ,.,.,,....,...... c Net investment earnings, gains, . . . . '' . .. . .. .

and losses .................... . .d Grants or scholarships ...........________________ . .e Other expenditures for facilities . .

and programs ..................________________I Administrative expensesg End of year balance .,,.......,

2 Provide the estimated percentage of the year end balance held as;a Board designated or quasi-endowmentb Permanent endowment -cTerm endowment

3a Are there endowment funds not in the possession of the organization that are held and administered for theorganization by: Yes No

(,) unrelated organizations .............................................................. ................. ........ .3a(i

(ii)

)relatedorganizations ......................................................................................... 3a(ii)

b If 'Yes' to 3a(ii), are the related organizations listed as required on Schedule R?.. ..................................... 3b4 Describe in Part XIV the intended uses of the øtgaizôtiôn's endowment funds. .. .artVl1Land, Buildings, and Equipment. See Form 990, Part X, line 10.

Description of investment 1(a) Cost or other basis I (b) Cost or other (cAccumuIated (d) Book valueoasis(other) oeprecIuon

118,068. 85,678. 32,.390.

132,310. 109,339. 1 22,971.

36,.986. 21,411.1 15575.

i-in.(B), line 10(c).) .... ...... ,,,,__ _.,., I 70, 936.Schedule D (Form 990) 2010

laLand ........................................b Buildings ...................c Leasehold improvementsdEquipment ............ ........ ........... ....e Other

Total. Add lines la through le (Coluthn (c) must egiBAA

TEEA3302 12/20110

Schedule D (arm 99O) 2010 Americans fo: ProsperitV. Foundation 52-1527294

Pätt VII Investments—Other Securities. e Form 990. Part X. line 12(a) Description of security or category

(hncluding name of security)(1) Financial derivatives(2) Closely-held equity interests(3) Other

--.-

----------------- -

— — — — — — — — —

_(F) — — — — — — -- - - -----JGJ - --

--------------------------

_sI1__________________________Total. (Column (1,) must equal Farm 990 PartX column (B) line 12.),; , .I PàrtVIII I Investments—Proaram Related. (See

(b) Book value (c) Method of valuation,- Cost or end-of-year market

(a) Description of investment type I (b) Book value

I -

(c) Method of valuation:Cost or end-of-year market value

column (B) finer 13j'iForm 990. Part X. line 15

)ok value117,339.

Total. -(Column (b) must equal Form 990. Part X, cöiijmnB line 15) - -. . '1 117, 339.

I Part X:I Other Liabilities. (See Form 990, Part X, line 25),(a) Description of liability (b) Amount

(1) Federal income taxes(2)Securitydeposit 0. - - . •. ..(3)Due,to affiliate 11582,195.(4)

(6)

(8) . .- . ,. - S..- S

- S

Total. (ColUmn (b) must equal Form 990. Part X column (B) line 25)....... 11 582., 195.2. FIN 48 (ASC 740) Footnote. In Part XIV, provide the text of the footnote to the organization's financial statements that reports theorganization's liability for uncertain tax positions under FIN 48 (ASC 740).BAA iEE303 2120fl0 Schedule D (Form 990) 2010

Schedule D (Form 990)2010 Americans for Prosperity Foundation 52-1527294 Pe 4:Xl . 1 Reconciliation of Change in Net Assets from Form 990 to Audited Financial Statements

1 Total revenue (Form 990, Part VIll,column (A), line 12) .............................2 Total expenses (Form 990, Part IX, column (A), line 25) .............

3 Excess or (deficit) for the year. Subtract line 2 from line 1 ...,,.,..., ... ,, .,I t I.,......... ..... , ................4 Net unrealized gains (losses) on investmeflts ...................................................................5 Donated services and use of facilities ..............................................................................6

Investment expenses ..........................................................................................7

Prior period adjustments .................................................... ....................................8 Other (Describe in Part XIV) ............................... . .....................................................9 Total adjustments (net). Add lines 4 through 8 ..................................., ........ • .............;. .......

10 Excess or (deficit) for the year per audited financial statements. Combine lines 3 and 9Mii I PprnndIifinn nf Revenue nr Audited Financial Statements With Revenue per Returr

1 Total revenue, gains, and other support per audited financial statements....................................2 Amounts included on line 1 but not on Form 990, Part VIII, line 12:

a Net unrealized gains on investments ............................................. 2ab Donated services and use of facilities .........................................2b

d Other (Describe in Part XIV) ...........................................- 2dC Recoveries of prior year grants ..............................2c

2ee Add lines 2a through 2d ................................................... .. 3 17,461,1253 Subtract line 2e from line 1 ...................................................4 Amounts included on Form 990, Part VIII, line 12, but not on line 1:

a Investments expenses not included on Form 990, Part VIII, line 7b ...............4ab Other (Describe in Part XIV.) .................................................4b

4ccAdd lines 4a and 4b ........................................................................................_2. 17,461,125.5 Total revenue. Add lines 3 and 4c. (This must equal Form 99t, Part I, line 72.) . . ... .......................

artXlll J Reconciliation of Expenses per Audited Financial Statements With Expenses per Return15,311,533.1 Total expenses and losses per audited financial statements.......___ ............

2 Amounts included on line 1 but not on Form 990, Part IX, line 25:a Donated services and use of facilities ...........................................2ab Prior year adjustments .......................................................2bcOther losses .................................................................. 2C

Other (Describe in Part XIV.) .................................................2dd2eeAdd lines 2a through 2c1 ...................................................,, .... ... ...... ..................

.-- 15,311,533.3 Subtract line 2e from line 1 ............................................................. Amounts included on Form 990, Part IX, line 25, but not on line 1:a Investments expenses not included on Form 990, Part VIII, line 7b ........... 4a

b Other (Describe in Part XIV.) .................................................4b 4ccAdd lines 4a and 4b ...................................................................................

15,311, 533,5 'Total expenses Add lines 3 and 4c (This must equa/ Fotm .990_Part I line 18)

Complete this part to provide the descriptions reqi.iired for Part II, lines 3, 5, and 9; Part Ill, lines la and 4; Part IV, lines lb and 2b;Part V. line 4; Part X, line 2; Part Xl, line 8; Part XII, lines 2d and 4b; and Part XIII, lines 2d and 4b. Also complete this part to provideany additional information.

tx . The O:E^anization evaluated its— tax Positions—and—.--

determined it has no uncertain tax positions as of December 3lL._L01(L.__..-

-The 0rq.nization 1 s _l ug_20 tax years are open

-----------for examination y_ ------------

17., 461, 125.

15 311,, 533.2,149,592.

2,149,592.

7.461.125.

BAA TizEA3304 02111/11 Schedule 0 (Form 990) 2010

Schedule D(Form99O)2010 Americans for Prosperity Foundation 52-1527294 Paqe5

I Part XW I Supplemeritat Information (continued)

BAA TEE 305 07116110 Schedule D (Form 990) 2010

SCHEDULE G I Supplemental Information Regarding(Form 990 or °) 1 Fundraising or Gaming Activities

Complete if the organization answered'Yes' to Form 990, Part IV, lines 17 18Depadment of the TrvaSUry

or 19, or if the organization entered more than $15,000 on Form 990-EZ, line 6a.Internal Revenue Service Attach to Form 990 or Form 990-EL 3, See separate instructions.

OMB No. 1545-0047

2010- Open to Public

Inspection

Namof the organization - Employer Identification number

Americans for Proseritv Foundation 52-1527294

line W.

Indicate whether the organization raised funds through any of the following activities. Check all that apply.a X Mail solicitations e Solicitation of non-government grantsb X Internet and email solicitations f Solicitation of government grantsc Phone solicitations g Special fundraising eventsd X In-person solicitations

2a Did the organization have a written or oral agreement with any individual (including officers, directors, trustees or keyemployees listed in Form 990, Part VII) or entity in connection with professional fundraising services' ................... El Yes fl No

b If 'Yes, list the ten highest paid individuals or entities (fundraisers) pursuant to agreements under which the fundraiser is to becompensated at least $5,000 by the organization.

(v)Amount paid to(i) Name and address of individual (ii) Activity (iii) Did fundraiser (iv) Gross receipts (or retained by) (vi) Amount paid to

or entity (fundraiser) have custody or control from activity fundraiser listed in (or retained by)of contributions? column (i) organizationYes I No

1 Melange Enterprises in person solic

2Terra McCiella-rid Xo-peraon solic

3BMD Consultation

4

5

6

7

8

9

10

61,000.

34,470.

x 43,217.

000.1 30,0

10,000

24.47

84, 640. —41.423.

Total......... ...... ............................... 138,687. 125, 640. 13,047. 3 List all states in whlch the organization is or licensed to solicit contributions or has

or licensing.

BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EZ. Schedule G (Form 990 or 990-EZ) 2010TEEM701 01/13/11

Schedule G (Form 990 or 990-EZ) 2010 mericans for Prosperity Foundation 52-1527294 Pane 2Part-lI: 1 Fundraising Events. Complete if the organization answered 'Yes to Form 990, Part IV, line 18, or

reported more than $15,000 of fundràisingevent contributions and gross income on Form 990-EZ, lines 1and 6a. List events with gross receipts greater than $5,000.

I I (a) Event Al I (b) Event #2 (c) Other events (d)Total events

REVENUE

taaa column a)

(event type) I (event type) (total number) through column (c))

IiRECT

ExPENSES

1 Gross receipts ..........................2 Less: Charitable contributions ...........3 Gross income (line 1 minus line 2) ......

4 Cash prizes ...........................5 Noncash prizes .........................6 Rent/facility costs ...,.. ...............7 Food and beverages ....................8 Entertainment ...........................9 Other direct expenses .................

10 Direct expense summary. Add lines 4- through 9 in column (d) ............. .................................11 Net income summary. Combine line 3, column (d), and line 10jj Gaming. Complete if the organization answered 'Yes ' to Form 990, Part IV, line 19, or reported more than

$15,000 on Form 990 -EZ, line 6a. . . ..1

EDX'PREENCsIC

S

REVCNUE

(a) Bingo (b) Pull tabs/Instant (c) Other gaming (d)Total gamingbingo/progressive (add column (a)

bingo I I through column (c))

1 Gross

2 Cash prizes .........:....................

3 Non-cash prizes ....................

4 Rent/facility costs ......................

5 Other direct exoenses ..................Yes % Yes .% Yes

6 Volunteer labor ...........................No No No

7 Direct expense summary. Add lines 2 through 5 in column (d) ................. .............................. .____________________

8 Net aamina Income :...........

9 Enter the state(s) in which the organization operates gaming activities:a Is the organization licensed to operate gaming activities In each of these states? ................. .. . Yes No

blfNo,' explain: . .-.— -----------...- -----------------------

10 a Were any of the organization's gaming licenses revoked, suspended or terminated during the tax year? jJ(es fl No -blf 'Yes, ' explain: -----.------------------------------.. -

BAA TEEA3702 01/13111 Schedule G (Form 990 or 990-EZ) 2010

Schedule G (Form 990 or 9Q.E2 2010 Americans for Prosperity Foundation . 52-1527294. Page 311 Does the organization operate gaming activities with nonmembers' ............................................... IjJ Yes Lj No

12 Is the organization a grantor, beneficiary or trustee of a trust or a member of a partnership or other entity formed toadminister charitable gaming' ................................................................................... 0 Yes No

13 Indicate the percentage of gaming activity operated inaThe organization 's facility ................................................................... 13a . ...

bAnoutside facility ............................................................................................ 13b .14 Enter the name and address of the person who prepares the organization's gaming/special events books and records:

Name

Address

15a Does the organization have a contact with a third party from whom the organization receives gaming revenue? ........ . flves No

b If 'Yes, enter the amount of gaming revenue received by the organization $. . and the amountof gaming revenue retained by the third party - $

c If 'Yes,' enter name and address of the third party:

Name

Address

16 Gaming manager information:

Name

Gaming manager compensation

Description of services provided -----------------------

LI Director/officer Employee Independent contractor

17 Mandatory distributions

a Is the organization required under state law to make charitable distributions from the gaming proceeds to retain thestategaming license' ........................................................................................... LI Yes No

b Enter the amount of distributions required under state law to be distributed to other exempt organizations or spent in the'organization's own exempt activities during the tax year

rt iVj Supplemental Information Complete this part to provide the explanations required by Part I, line 2bcolumns (iii) and (v), and Part lllj lines 9, 9b, lOb, 15b, 15c, 16, and 17b, as applicable. Also completethis part to provide any additional information (see instructions).

BAA iEEP703. oiiuni Schedule G (Form 990 or 990-EZ) 2010

SCHEDULE J Compensation Information OUS No.. 1545.0047

(Form 990) For certain Officers, Directors, Trustees, Key Employees, and Highest 2010Compensated EmployeesComplete if the organization answered 'Yes to Form 990, Part IV, line 23. Open

Attach to Form 990 See separate instructions lnsjEmployer Identification number

1 ft 5,r+4tr, 152-1527294

Department of the TreasuryInternal Revenue Service

of the organization

IC,.

omYes I No

b If any of the boxes on line 1 a are checked, did the organization follow a written policy regarding payment orreimbursement or provision of all of the expenses described above? If No,' complete Part Ill to explain ....................1 b

2 Did the organization require substantiation prior to reimbursing or allowing expenses incurred by all officers, directors,trustees, and the CEO/Executive Director, regarding the items checked in line la' .....................................

3 Indicate which, if any, of the following the organization uses to establish the compensation of the organization'sCEO/Executive Director. Check all that apply.

Compensation committee Written employment contractIndependent compensation consultantX Compensation survey or study

X Form 990 of other organizations X Approval by the board or compensation committee

1 a Check the appropriate box(es) it the organization provided any of the following to or for a person listed in Form 990, PartVII, Section A, line la. Complete Part Ill to provide any relevant information regarding these items.

, First-class or charter travel Housing allowance or residence for personal useTravel for companions Payments for business use of personal residenceTax indemnification and gross-up payments Health or social club dues or initiation feesDiscretionary spending account Personal services (e.g., maid, chauffeur, chef)

4 During the year, did any person listed in Form 990, Part VII, Section A, line la with respect to the filing organizationor a related organization:

a Receive a severance payment or change-of-control payment from the organization or a related organization ? ..............b Participate in, or receive payment from, a supplemental nonqualified retirement plan ? ...............•,. ................c Participate in, or receive payment from, an equity-based compensation arrangement? ...................................

If 'Yes' to any of lines 4a-c, list the persons and provide the applicable amounts for each item in Part Ill.

Only section 501(cX3) and 501(c)(4) organizations must complete lines 5-9.

5 For persons listed in Form 990, Part VII, Section A, line la, did the organization pay or accrue any compensationcontingent on the revenues of:

aThe organization? .................................................................................................bAny related organization? ............................... ...................... ......

If 'Yes' to line 5a or 5b, describe in Part III.

6 For persons listed in Form 990, Part VII, Section A, line la, did the organization pay or accrue any compensationcontingent on the net earnings of:

aThe organization ? .....................................................................................................bAny related organization' ............................................................................................

If 'Yes' to line 6a or 6b, describe in Part Ill.

4a X

4b X

4c X

Sal I X

5b X

6a X

I 6b X

7 For persons listed in Form 990, Part VII, Section A, line la, did the organization provide any non-fixed payments notdescribed in lines 5 and 6? If 'Yes,' describe in Part III .................................................................7 X

8 Were any amounts reported in Form 990, Part VII, paid or accrued pursuant to a contract that was subject to the initialcontract exception described in Regulations section 53.4958-4(a)(3)? If 'Yes,' describe in Part III .........................8 X

9 If 'Yes' to line 8, did the organization also follow the rebuttable presumption procedure described in Regulationssection 53,4958-6(c)' ......... ...............9

BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990. Schedule J (Form 990) 2010

TEEA4I0I 12122110

Schedule J (Form996 2010 Americans for Prosperity Foundation 52-1527294 Page 2I : Partlffl Officers, Directors, Trustees, Ky Employees, and Highest Compensated Employees. Use Schedule J-1 if additional space is needed.For each individual whose compensation must be reported in Schedule J, report compensation from the organization on row (i) and from related organizations described in the instructions onrow (ii). Do not list any individuals that are not listed on Form 990, Part VII.

Note. The sum of columns (B)(i)-(iii) must equal the applicable column (D) or column (E) amounts on Form 990, Part VII, line la.

(B) Breakdown of W-2 and/or 1099-MISC compensation (C) Retirement and (D) Nontaxable (E) Total of columns (F) Compensation

(A) Name 0) Base (ii) Bonus and incentive (ill) O1iar other deferred benefits (B)(i)-(D) reported in priorcompensation compensation ieporlable compensation orm 990 or

Form 990-EZi) .. ___11 L 2 48L905.-0.-3,602.-7976.--177,308. ,____12704

1 Tim Phillips 0 01 122,057. 51,095. 0. 3,748, 8,324. 185,224. 113,114.(I) 0--4092 --4388.-145 7_.

2 John Flynn 18,223. 0. 0. 558. 598. 19,379. 34,259.- ------ - -'- _tQ• 127,541.

3 Alan Cobb 72,726. 7,443. 0. 2,417. 6,627. 89,213. 61,183.(I) 91L200. - -----10L600..0.-3O78.

4 Philip Kerpén -

68,800. 9,400. 0 2,322. 2,227. 82,749. 77,145.) _.J2L9.L. 14L850.-

6

2921-2742--1O2 910. . ------5 Steven Loneg jj'lan 67,604. 12,150. 0. 2,389. 2,244. 84,387. 23,364.

------ - -----(I) __. ----------,— ------------------,.- ------____ ____ ____ t::::::::::::::i::::::::::::::::X::::::::::::-

___L---------4-------------- ------------4

I__________

----------t-.----------1-----------I----------------------1 --------. -

F------------+----------H- ---------I-------------------------------- L- ------TEEA41 02 07120/10 Schedule J (Form 990) 2010

7

8

9

10

11

12

13

14

15

16BAA

Complete this part to provide the information, explanation, or descriptions required for Part I, lines la, ib, 4c, 5a, 5b, 6a, 6b, 7, and 8. Also completethis part for any additional information.

Pt _ILine 7 PITLeLeE 1b1 discretionary bonuses based on performance..

BAA Schedule J (Form 990) 2010

TEEA4103 07/20110

OMB No. 1545-0047

Transactions With Interested PersonsComplete if the organization answered

'Yes' on Form 990, Part IV, Iine25a, 25b,'26, -27,28a, 28b, or 28c,or Form 990-EZ, Part V, line 38a or 40b. n(.-

De rtment of the I - Attach to Form 990 or Form 990-a. See separate instructions InsI

Name of the &ganization Employer Identification number

Americans for Prosperity Foundation 0 152-1527294

IParttJ Excess Benefit Transactions (section 501Complete if the organization answered 'Yes' on Form

1 (a) Name of disqualified person I

.12 Enter the amount of tax imposed on the organization managers or disqualified persons during the year under

section4958 .............................................................................................3 Enter the amount of tax, if arty, on line 2, above, reimbursed by the organization.................. .............. -ai.t:II.:l Loans to and/or From Interested Persons.

Complete if the organization answered 'Yes' on Form 990, Part IV, line 26 or Form 990-EZ, Part V, line 38a.

(a) Name of Interested person and purpose (b) Loan to or from (c) Original (d) Balance due (a) In default? (1) Approved (g) Written

the organization? principal amount by board or agreement?committee?

To From Yes No Yes No Yes No

.1IIl-I Grants or Assistance Benefitting Interested Persons.- Complete if the organization answered 'Yes' on Form • 990, Part IV, line 27

(a) Name of interested person (b) Relationship between Interested person and (c) Amount and type of assistancethe organization

BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EL Schedule L (Form 990 or 990 . EZ) 2010

SCHEDULE L(Form 990 or 990.EZ)

and section 501 (c)4 organizations only).it IV, line 25a or 25b, or Form 990-EZ, Part V, line 40b.-

(c) Corrected?(b) Description of transaction

Yes I No

1EEA4501 11/15/10

Schedule L (Form 990 or 990EZ 2010 Americans for Prosperity Fo'nndation 52-1527294 Page 2

I Pat VJ Business Transactions Involving Interested Persons.Complete if the organization answered 'Yes' on Form 990, Part IV, line 28a, 28b, or 28c.(a) Name of interested person

Chr Fink

(b) Relationship betweenInterested person and the

organization

son of bo

(d) Description of transaction (a) Sharing oforganizations

revenues?Yes No

rv x

(C) Amount oftransaction

52, 853 . Is

I Part \t I Supplemental InformationComplete this part to provide additional information for responses to questions on Schedule L (see instructions).

/

Schedule L (Form 990 or 990-E 2010TEEA4501 11/15/10

Noncash ContributionsComplete if the organizations answered 'Yes

on Form 990, Part IV, lines 29 or 30.'Attach to Form 990.

tv Foundation

OMB No. 1545.0047

2010IliSpe

Employer identification number

52-1527294

SCHEDULE M(Form 990)

Department of the TreasuryInternal Revenue ServiceNameof the organization

Americans for Pro

(a) (b) (c) (d)

Check if Number of Noncash contribution Method of determining

applicable contributions or amounts reported on noncash contribution amounts

items contributed Form 990,

Part VIII, line ig -1 Art—Works of art .................................________2 Art—Historical treasures ................ ......... .________3 Art—Fractional interests ..........................4 Books and publications 5 Clothing and household goods ....................________ •- : . -6 Cars and other vehicles .................... .....________7 Boats and planes ................................. -8 Intellectual property .......................... ..._______9 Securities—Publicly traded ................... ....X 6 1, 371, 969. fa

10 Securities—Closely held stock ................... .________11 Securities—Partnership, LLC, or trust interests12 Securities—Miscellaneous .....................•,..

13 Qualified conservation contribution—Historic structures ...........................•.:.

14 Qualified conservation contribution—Other ..,....15 Real estate—Residential ......................... .________16 Real estate—Commercial ......................... -17 Real estate—Other . . . ..........................________18 Collectibles ............................ .........__________________19 Food inventory ................... ................ .________20 Drugs and medical supplies . . . .,................ .________21 Taxidermy ....................... ................________22 Historical artifacts .................................. —23 Scientific specimens ...........................

... 24 Archeological artifacts ..................... ...________25 Other (S- up1ies

.

-) ... X 2 5,229. fair market value26 Other - (••-------_. ---------27 Other 28 Other -(

29 Number of Forms 8283 received by the organization during the tax year for contributions for which theorganization completed Form 8283, Part IV, Donee Acknowledgement .....................................29

Yes

30a During the year, did the organization receive by contribution any property reported in Part I lines 1-28 that it musthold for at least three years from the date of the initial contribution, and which is not required to be used for exemptpurposes for the entire holding period? .......................................................................• ,, 30a—

b If 'Yes.' describe the arrangement in Part II.31 Does the organization have a gift acceptance policy that requires the review of any non-standard contributions ? ....... 31 —

32a Does the organization hire or use third parties or related organizations to solicit, process, or sellnoncashcontributions? ................. ;..• w .......... ................................................. -. ,.. —

b If 'Yes, describe in Part II. .. j....33 If the organization did not report an amount in column (c) for a type of property for which column (a) is checked,

describe in Part II.BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990. Schedule M (Form 990) 2010

market value

No

x

X

X

TEEA4601 12/29/10

Schedule M (Form 9) 2010 Americans for Prosperity Fotthdation 52-1527

I PaftH Supplemental Information. Complete this part to provide the information required by Part I, lines 30b, 32b,and 33. Also complete this part for any additional information..

-----:-:- --------------------__;.__•.:. _____________

_.L ------------------------- --- ----------------------

BAA TEEA4602 10/26110 Schedule M (Form 990) 2010

SCHEDULE 0(Form 990 or 990-EZ) Supplemental Information to Form 990 or 990-EZ OMB No. 1545-0047

2010Department of the TreasuryInternal Revenue ServiceName of the organization

Complete to provide information foi répónses to specific questions onForm 990 or 990-EZ Or to provide any additional information.

Attach to Form 990 or 990.EZ.Employer Identification number

52-1527294

lflSlCt!Ofl.

Pt 14Q ljzj The 990 is distributed to the board for review and qest ions-.

--__t_41g. ----------------

Pt _YJ:.'-determin e• ------

- --------------the oran1Zat1On p. Substantiation of compensation is included in personnel files.

-----------------------------------------------------------------Pt VI7-C Documents are provided upon recruest.

- J L Line • - T1ir o _t1e_ L1!P_ ma voluntary

c.apacitV, have a business relationship yL-^L ftach. other.

Pt yI-B , Line 12c Exp1oees enter a conflict of interest ae_nuon

ceiv9_theexpl2yeexnual._The _agQ _mnt

---------_ arise.--There is-no

for board member. -

Pt _ ::&i4 2't committees- iQ.-- ... --------------

BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990 or 990-EL TEEM901 10126/10 Schedule 0 (Form 990 or 990-EZ) 2010

orm 990, Part IV, line

(d)Exempt Code

section

1If1

(e) (I) (g)Public charity status Direct controlling Sec 512(bXl3)(if section 501 (c)(3)) entity controlled entity?

Yes I No

SCHEDULE R(Form 990)

Department of the TreasuryInternal Revenue Service

Name of the organization

OMB No. 1545-0047

2010Q,etóPübIk

n IctionEmployer identification number

52-1527294

Related Organizations and Unrelated Partnerships- Complete if the organization answered 'Yes' to Form 990, Part IV, line 33,34,35,36, or 37.

- Attach to Form 990. 1, See separate Instructions.

iPart iI Identification of Disregarded Entities (Complete if the organization answered 'Yes' to Form 990, Part IV, line 33.)(a) (b) (c) (d) (e) (0

Name, address, and EIN of disregarded entity Primary activity Legal domicile (state Total income End-of-year assets Direct controllingor foreign country) entity

c;u--------_____________ --- ___

____________. ______

(6)

I Partil Ildentification of Related Tax-Exempt Organizations (Complete if the organizationone or more related tax-exempt organizations during the tax year.)

(a) (b) (c)Name, address, and EIN of related organization Primary activity Legal domicile (state

or foreign country)

1) 2mericans for Prosperity 75-3148958 Educate and2111 Wilson Blvd, *350, Arlington VA 22201 mobilize ci

----

-----------------------

---------------------------

- ------------------------------

- -------------- ----- --- --

BAA For Paperwork Reduction Act Notice, see the Instructions for Form 990. TEE.A5001 12122110 Schedule R (Form 990) 2010

I

Schedule R (Form 99O)2010 Americans for Prosperity Foundation 52-1527294 - Page

Part ii I Identification of Related Organizations Taxable as a Partnership (Complete if the organization answered 'Yes' to Form 990, Part IV, line 34because it had one or more related organizations treated as a partnership during the ta'x yeãr)

(a) (b) (c) (d) (e) (U (g) (h) (I) J) 1 (k)Name, address, and EIN of Primary activity Legal Direct Predominant Share of total Share of Dispropor- Code V-UBI General or I Percentage

related organization domicile controlling entity income (related, income end-of-year tionate amount in box managing I : ownership(state or unrelated, excluded assets allocations? 20 of Schedule partner? 1foreign from tax under____________ K-i

country) sections 512514) Yes I No (Form 1065) Yes I No I_11

j21_________

IParIvI Identification of Related Organizations Taxable as a Corporation or Trust (Complete if the organization answered 'Yes' to Form 990, Part IV,6

line 34 because it had one or more related organizations treated as a corporation or trust during the tax year,)(a) (b) (c) (d) (e) (f) (g) (h)

Name, address, and EIN of related organization Primary activity, Legal domicile Direct Type of entity Share of total income Share of end-of-year Percentage(state or foreign controlling entity (C corp, S corp, assets ownership

crnjntrv) I I or trust)

BAA

TEEA5002 12107/10 Schedule R (Form 990) 2010

Schedule R (Form 990)2010 Americans for Prosperity Foundation 52-1527294 Page .3I Part V. 1 Transactions With Related Organizations (Complete if the organization answered 'Yes' to Form 990, Part IV, line 34, 35, 35a, or 36.)

Note. complete line 1 if any entity is listed in Parts 11, III, or IV of this schedule.During the tax year did the organization engage in any of the following transactions with one or more related organizations listed in Parts I]-IV?

a Receipt of () interest (Ji) annuities (iii) royalties (iv) rent from a controlled entity ...................................................... .............................. LJ..b Gift, grant, or capital contribution to other organization(s) ...................................................................................'.;. •c Gift, grant, or capital contribution from other organization(s) ................................................................................................•dLoans or loan guarantees to or for other organization(s) .................................................................................... .............................e Loans or loan guarantees by other organization(s) ...................................................................................................................I i efSale of assets to other organization(s) ..............................................................................................................................gPurchase of assets from other organization(s) .....................................................................................................................L.1ii Exchange of assets .............................................................................................................................................iLease of facilities, equipment, or other assets to other organization(s) ....................................................• ........... .... ................. ............I iiI Lease of facilities, equipment, or other assets from other organization(s) ....................................•. .........................................................Ic Performance of services or membership or fundraising solicitations for other organization(s) ...........................................................................I Performance of services or membership or fundraising solicitations by other organization(s) ..., ..... . .............m Sharing of facilities, equipment, mailing lists, or other assets ............................................................................................................a Sharing of paid employees ............................................................................. .......................................o Reimbursement paid to other organization for expenses ....................................................................................•pReimbursement paid by other organization for expenses .............................................................................................................qOther transfer of cash or property to other organization(s) ............................:. • . ..........................................................................r Other '11 nsferóf cash or property from other organiaaUons) . ..........•. ;. .. .........................................................................................

No

X

MMX

X.

and(b) (C) (d)

TransactionAmount involved Method of determiningtype (a.r) amount involved

to any of the above for this(a)

Name of other organization

d

e

BA rEE.A5003 12123110

Schedule R (Form 990) 2010

(f)Dispropor-

tionateallocations?

Yes I No

(g) (h)Code V-UBI amount General or

in box 20 of managingSchedule K-i partner?Form (1065)

Yes I No

Schedule R (Form 99O)2010 Americans for Prosperity Foundation 52-1527294 Page 4

IPaItVJI Unrelated Organizations Taxable as a Partnership (Complete if the organization answered 'Yes' to Form 990, Part IV, line 37.)

Provide the following information for each entity taxed as a partnership through which the organization conducted more than five percent of its activities (measured by total assets or grossrevenue) atithat was not a related organizon See Instructions regarding exclusion for certain Investment partnerships -

(a) I (b)

I

(c) I (d) I (e)Name domicile Are all partnersladdress, and EIN of entity Primary activity I Legal do Share of end-of-year

I (state or foreign I section I assetscountry) I I

Yes I No I

_!;1i-------------------------------. -----

- .......

-

ffi)_--------------- ---------------

-------------- ----------

BAA TEEA5004 12123/10 Schedule R (Form 990) 2010

Schedule (Form 990)2010 Americans for Prosperity Founda 52-1527294

Complete this part to provide additional information for responses to questions on Schedule R(see instructions),.

BAA TEEA5005 07/16110 Schedule R (Form 9905 2010

Americans for Prosperity Foundation 52-1527294

Schedule 0 (Form 990), Supplemental Information to Form 990Form 990, Page 6, Line 17 (continued)

AlabamaAlaskaArizona -ArkansasCaliforniaColoradoConnecticutDistrict of ColumbiaFloridaGe6rqiaIllinoisKansasKentuckyLouisianaMaineNew HampshireNew JerseyNew MexicoNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaRhode IslandSo"utli CarolinaTennesseeUtahVirginiaWashingtonWest VirginiaWisconsinHawaii

1•

FINANCIAL STATEMENTS ANDINDEPENDENT AUDITOR'S REPORT

AMERICANS FOR PROSPERITY FOUNDATIONDecember 31, 2010

Ll

TABLE OF CONTENTS

PAGE

INDEPENDENT AUDITOR'S REPORT 1

FINANCIAL STATEMENTS

Balance Sheet 2

Statement of Activities 3

Statement of Cash Flows 4

Statement of Functional Expenses 5

Notes to Financial Statements 6

DOUGLAS COREY & ASSOCIATES, P.C.

C

CERTIFIED PUBLIC ACCOUNTANTS6601 LITTLE RIVER TURNPIKE, SUITE 440Aiu, VIRGINIA 22312(703) 354-2900 • FAx (703) 354-2606 E-L: coreycpa@coreycpa.com

INDEPENDENT AU]MTORtS REPORT

To the Board of DirectorsAmericans for Prosperity Foundation

We have audited the accompanying balance sheet of Americans for Prosperity Foundation (anonprofit organization) as ofDecember 31,2010, and the related statements of activities, cash flowsand functional expenses for the year then ended. These financial statements are the responsibility ofthe Organization's management. Our responsibility is to express an opinion on these financialstatements based on our audit;

We conducted our audit in accordance with auditing standards generally accepted in the UnitedStates of America. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement. An auditincludes examining, on a test basis, evidence supporting the amounts and disclosures in the financialstatements. An audit also includes assessing the accounting principles used and significant estimatesmade by management, as well as evaluating the overall financial statement presentation. We believethat our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, thefinancial position of Americans for Prosperity Foundation as of December 31,2010, and the changesin its net assets and its cash flows for the year then ended in conformity with accounting principlesgenerally accepted in the United States of America.

o,

O 7April 28, 2011

(523,210)1,267,126

743,916

$ 2,875,479

Americans for Prosperity FoundationBalance Sheet

December 31, 2010(See Independent Auditor's Report and notes to financial statements)

Assets

Current AssetsCash and cash equivalentsDue from affiliatePledges receivableOther receivablePrepaid expenses

Total current assets

Property, equipment, and leasehold improvementsnet of accumulated depreciation of $216,428

Deposits

$ . 652,4041,685,860

254,91156,62637,403

2,687,204

70,936

117,339

$ 2,875,479

Liabilities and Net Assets

Current LiabilitiesAccounts payable and accrued liabilitiesDue to affiliate

Total current liabilities

Net AssetsUnrestrictedTemporarily restricted

$ 549,3681,582,195

2,131,563

2

Americans for Prosperity FoundationStatement of Activities

For the year ended December 31, 2010(See Independent Auditor's Report and notes to financial statements)

TemporarilyUnrestricted Restricted Total

Revenues and Other Support:Grants and.contributionsContributed securitiesNoncash contributionsRegistration feesInvestment incomeLoss on sale of securitiesIntercompany interestMiscellaneous income

Net assets released from restrictions:Satisfaction of program restrictions

Total Revenues and Other Support

Expenses:Program expenses

State chapter activitiesNational activites

General and administrativeDevelopment

Total Expenses

Change in Net Assets

Net Assets, beginning of year

Net Assets, end of year

$ 10,317,754 $ 5,227,123 $ 15,544,877 1,371,969 - 1,371,969

5,229 - 5,229 467,937 - 467,937

555 - 555 (15,686) - (15,686)

84,630 - 84,630

1,614 - 1,614

4,470,611 (4,470,611) -

16,704,613 756,512 17,461,125

4,025,843 - 4,025,843

9,004,307 - 9,004,307

1,302,412 - 1,302,412

978,971 - 978,971

15,311,533 - 15,311,533

1,393,080 756,512 2,149,592

(1,916,290) 510,614 (1,405,676)

$ (523,210) $1,267,126 $ 743,916

3

Americans for Prosperity FoundationStatement of Cash Flows.

For the year ended December 31, 2010(See Independent Auditor's Report and notes to financial statements)

Cash flows from operating activities:Change in net assetsAdjustments to reconcile change in net assets tonet cash provided by operating activities:

DepreciationRealized loss on sale of securitiesContributed securities(Increase) decrease in due from affiliates(Increase) decrease in pledges receivable(Increase) decrease in other receivable(Increase) decrease in prepaid expenses(Increase) decrease in depositsIncrease (decrease) in accounts payableIncrease (decrease) in due to affiliateIncrease (decrease) in security deposit

Net cash provided (used) by operating activities

Cash flows from investing activities:Fixed asset purchasesProceeds from sale of securities

Net cash provided (used) by investing activities

Net increase in cash and cash equivalents

Cash, beginning of year

Cash, end of year

$ 2,149,592

65,87715,686

(1,371,969)(706,179)(132,116)

2,655(1,932)19,213

188,049(1,192,377)

(38,363)

(1,001,864)

(6,600)1,356,283

1,349,683

347,819

304,585

$ 652,404

During the year the Foundation had the following noncash transactions whichwere excluded from the statement of cash flows:

$ 5,229Fair market value of donated supplies

Supplemental disclosures:

Cash paid during the year for:Income taxesInterest expense 4

$$

Americans for Prosperity FoundationStatement of Functional Expenses

For the year ended December 31, 2010(See Independent Auditor's Report and notes to financial statements)

Program Services Supporting Services

State Chapter National Ttl Program Mgmt and Develop- Ttl Supporting TotalActivities Activities Services General ment Services Expense

371,554 $1,329,891

367,693666,441220,538

47,675128,723189.900

Communications ads, media $SalariesMeetings, conferences and eventsContractorsTravelEquipment leasing, IT serviceRentProfessional fees, consultingIntercompany interestEmployee benefits 128,582Printing, duplication 90,288Honoraria 191,300Payroll taxes 96,840Telecommunications 71,278Office supplies and expense 56,326Computers/office equipment 13,894Postage, courier, overnight 33,720DepreciationRegistration fees 10,053Dues and subscriptions 4,784List rental 4,969AccountingTemporary employees 111Legal 1,033Business insurance 250SponsorshipsOverhead allocated to affiliate

$ 4,025.843

6,018,002712,939

1,339,91367,168

249.409156,38063,33590,713

43,996138,41351,00047,63923,64030.81620,87524,65214,3089,9668,535

17,5784,5273,9582,378

6891,000

(137.522)$ 9.004.307

$ 6,389.556 $

115,136 $

2,042,830

245,527

1,707,606

50,330

733,609

33,752 469,947

115,088

204,055

136,234

192,058

142,772

280,613

60,997357,623

172,578

98,989

228,701

14,597

242,300

11,000

144,479

19,238

94,918

43,318

87,142

40,726

34,769

42,783

58,372

16,244

14,308

32,804

20,019

7,756

13,319

5,66122,547

4,527

10,206

4,069

9,005 3,411

2,010

939

1,554 1,000

1,250

(137.522)

(312.188)$ 13.030.150 $ 1,302.412 $

5,805506,569

9,951142,56846,40576,25659,23218,453

40,32826,327

36,86519,59215,98717,98716,67718,76528,74517,300

2614,2343,651

834644

(134.465)978.971

$ 120,941 $ 6,510,497

752,096 2,794,926

60,281 1,767,887

176,320 909,929

161,493 631,440

212,490 416.545 202,004 394,062

79,450 360,063

357,623 357,623

139,317 311,895

40,924 269,625

11,000 253,300

56,103 200,582

62,910 157,828

56,713 143,855

60,770 95,539 32,921 91,293

51.569 65,877 36,501 56,520

22,961 36,280

261 22.808

14,440 18,967

12.656 16,725

2,844 6,255 2,198 3,137

1,250 2.250

(446.653) (584.175) $ 2281.383 $ 15.311.533

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note A - Nature of Organization

Americans for Prosperity Foundation AFPF was incorporated on July 22, 1987, and commencedoperations on February 1, 1988. AFPF is a nationwide organization of citizen leaders committed togreater economic growth, opportunity, and prosperity through strong ethical foundations,government restraint, and private sector productivity and competition. AFPF educates citizens toachieve fiscal and regulatory restraint by state governments, and a return of the federal governmentto its constitutional limits. AFPF concentrates its efforts at the state level and maintains both statechapters and a national office to achieve its goals. AFPF's support comes primarily from individual,foundation, and business donors.

Note B - Summary of Accounting Policies

A summary of the significant accounting policies consistently applied in the preparation of theaccompanying financial statements follows;

1.Method of Accounting

AFPF's financial statements have been prepared on the accrual .basis of accounting in accordancewith generally accepted accounting principles.

2. Financial Statement Presentation

AFPF is required to report information regarding its financial position and activities according tothree classes of net assets: unrestricted, temporarily restricted, and permanently restricted. For theyear ended December 31, 2010, AFPF had no permanently restricted net assets.

n.

Americans for Prosperity FoundationNotes to Financial Statements

December 31,2010(See Independent Auditor's Report)

Note B - Summary of Accounting Policies, continued

3. Revenue Recognition

Contributions received are recorded as unrestricted, temporarily restricted, or permanently restrictedsupport, depending on the existence and/or nature of any donor restrictions.

All donor-restricted contributions are reported as an increase in temporarily orpeimanently restrictednet assets, depending on the nature of the restriction. When a restriction expires (that is, when astipulated time restriction ends or purpose restriction is accomplished), temporarily restricted netassets are reclassified to unrestricted net assets and reported in the statement of activities as netassets released from restrictions.

4. Advertising

AFPF utilizes print, radio and television ads to increase their membership base and bring theirmission to the public. These costs are expensed as incurred and totaled $6,510,497 for the yearended December 31, 2010. These costs are charged directly to the program they benefit.

5. Unconditional Pledges Receivable

Contributions are recognized when the donor makes a promise to give to the Organization that is, insubstance, unconditional. As of December 31, 2010, there were pledges receivable totaling$254,911.

6. Functional Allocation of Expenses

AFPF allocates its expenses on a functional basis among its various programs, general andadministrative, and development. Expenses that can be identified with a specific program, generaland administrative, and development are allocated directly according to their natural expenditureclassification. Other expenses that are common to both program functions and supporting servicesare allocated based on salary expenditures. Additionally, expenses charged to supporting servicecategories have been allocated to program categories based on time studies performed bymanagement.

7

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note B - Suinnmry of Accounting Policies, continued

7. Income Taxes

AFPF is exempt from income taxes on all activities directly related to its exempt purpose under theInternal Revenue Service Code Section 501(c)(3). The Organization is liable for income taxes onunrelated business income. There was no taxable net unrelated business income for the year endedDecember 31, 2010. Accordingly, no provision for income taxes has been made in these financialstatements.

The Organization evaluated its tax positions and determined it has no uncertain tax positions as ofDecember 31, 2010. The Organization's 2007 through 2010 tax years are open for examination byfederal taxing authorities.

8. Fixed Assets

Fixed assets are recorded at cost at the date of acquisition. They are depreciated on a straight-linebasis over the estimated useful lives of the assets, generally three to ten years.

9. Cash and cash equivalents

For purposes of the statement of cash flows, AFPF considers all highly liquid instruments purchasedwith a maturity of three months or less to be cash and cash equivalents.

At various times during the year ended December 31, 2010 AFPF had more funds on deposit at onefinancial institution than the $250,000 insured by the Federal Deposit Insurance Corporation.Management regularly monitors the financial condition of the banking institution, along with theirbalances in cash and tries to keep these potential risks to a minimum.

8

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note B - Summary of Accounting Policies, continued

10. Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principlesrequires management to make estimates and assumptions that affect certain reported amounts anddisclosures. Accordingly, actual results could differ from those estimates.

Note C - Date of Management's Review

In preparing the financial statements, the Organization has evaluated events and transactions forpotential recognition or disclosure through April 28, 2011, the date that the financial statements wereavailable to be issued.

Note D - Property, Equipment, and Leasehold Improvements

Property, equipment and leasehold improvements are as follows:

Office equipment $132,310Office furniture 36,986Leasehold improvements 118,068

287,364Accumulated depreciation (216428)

Net book value $70,936

Depreciation expense for the year ended December 31, 2010 is $65,877.

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note E - Net Assets Released from Restrictions

Net assets were released frdm donor restrictions by meeting the time restrictions or by incurringexpenses satisfying the purpose restrictions specified by donors as follows:

Restriction accomplished:Arizona $ 4,868Arkansas 146,690California 191,827Colorado 77,887Florida 100,559Georgia 78,222Illinois 87,335Kansas 241,070Maine 24,917Maryland 62,405Michigan 169,035Missouri 85,970Nebraska 60,840Nevada 9,077New Hampshire 74,160New Jersey 491,623New York 2,410North Carolina 9,783Ohio 22,887Oklahoma 136,511Oregon 214,165Pennsylvania 1,900South Carolina 15South Dakota 3,754Texas 171,132Virginia 11,330Washington 38,138Wisconsin 271,182

10

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note E - Net Assets Released from Restrictions, continued

2010 National SummitEPA/Climate ChangeFredom 5kMass Based MembershipHealthcareRight OnlineSick of SpendingSpending CrisisOther

Total restrictions released

321,87555,000

8,37351,735

336,888312,02825,000

555,00015,020

$4,470,611

Temporarily restricted net assets as of December 31, 2010 are available for the following purposes:

ArkansasCaliforniaColoradoFloridaMaineMarylandNevadaNew HampshireNew JerseyOhioOregonPennsylvaniaWashingtonTime restrictions (pledges receivable)

$68,47567,47916,213

201,09150,740

223,168120,923

8,58120,08739,55072,04674,75349,109

254,911$J,267, 126

11

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note F - Affiliated Organization

AFPF operates under an affiliation agreement with Americans for Prosperity (AFP). The agreementaddresses shared personnel, shared office space and facilities, and shared overhead costs. The sharedexpenses are allocated based on direct compensation and actual usage. In accordance with theagreement, the balance due to or from APP must be settled on a quarterly basis. If the balance is notsettled, interest accrues on the outstanding balance at one-percent per month. Occupancy, salaries,and administrative expenses allocated by APPF to AFP totaled $3,264;836 for the year endedDecember 31,2010. Interest charged by AFPF on the amount due from AFP totaled $84,630 for theyear ended December 31, 2010.

APP makes loans to AFPF on a periodic basis. The total due to AFP from AFPF as of December 31,2010 was $1,582,195. This amount includes interest charged to AFPF totaling $357,623.

Note G - Commitments and Contingencies

Office Space —2111 Wilson Boulevard

On May 14, 2009, AFPF entered into an operating lease for office space. The lease commenced onOctober 9, 2009. The lease term is ten years from the date of commencement. Initial base rent totals$269,646 annually, with annual increases of 3% per year. AFPF must also pay .96% of operatingcosts and real estate taxes annually.

In 2011, AFPF entered into an operating lease for expanded office space at their current location.The lease term is ten years with initial base rent of $260,462 annually, with annual increases of 3%per year. AFPF must also pay .90% of operating costs and real estate taxes annually.

12

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note G - Commitments and Contingencies, continued

Minimum base lease payments for future years under both leases are as follows:

Year ended December 31:2011

$494,7862012 554,3432013

570,9732014

588,1032015

605,7472016 and thereafter 2,496,614

$ 5,310,566

Office Space - Slate chapters

AFPF maintains operating leases for office space for state chapters in Kansas, Texas, Wisconsin,Oregon and Georgia. Leases for other state chapter offices are on a month to month basis: Monthlyrents range from $375 to $2,058. Leases expire at various dates through 2012.

AFPF's minimum lease payments total $62,394 for 2011 and $ 27,946 for 2012.

Note II - Direct Mail Costs

During 2010, AFPF incurred direct mail costs of $74,412. These costs have been reported as part ofdevelopment and membership.

1

13

Americans for Prosperity FoundationNotes to Financial Statements

December 31,2010(See Independent Auditor's Report)

Note I - Major Donors

During the year ended December 31, 2010, AFPF received $7,547,911 from one donor, whichaccounts for 43% of total support for the period.

Note J - Related Party Transactions

During 2010, contributions from board members and organizations affiliated with board memberstotaled $1,560,000.

Note K— Pension Plan

AFPF maintains a defined contribution 401(k) plan covering substantially all full-time permanentemployees. Under the plan, AFPF may, at its discretion, make matching contributions as apercentage of employee contributions. Matching contributions to the plan for the year endedDecember 31,2010 totaled $136,011. AFPF's share of those contributions totaled $83,582.

Note L - Contributed Assets and Services

Contributions of donated non-cash assets are recorded at their fair market values in the periodreceived. For the year ended December 31,2010, the Foundation received stock with a fair value of$1,371,969 and supplies with a fair value of $5,229.

Many volunteers have contributed numerous hours of administrative, maintenance and fund raisingservices to the Organization. However, these hours do not meet the requirements to be recorded asrevenue and expense under SFAS 116.

14

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 2010(See Independent Auditor's Report)

Note M — State Chapter Activities

For the year ended December 31, 2010, expenses by State chapter are as follows:

ArizonaArkansasCaliforniaColoradoFloridaGeorgiaIllinoisKansasMaineMarylandMichiganMissouriMontanaNebraskaNevadaNew HampshireNew JerseyNew YorkNorth CarolinaNorth DakotaOhioOklahomaOregonPennsylvaniaSouth DakotaTexasVirginiaWashingtonWisconsin

Total State chapter activities

37,609146,690191,82777,887

100,559106,89796,740

444,15424,91762,405

365,88093,019

1,174128,827

9,07774,159

491,6243,630

305,99311,38222,887

168,522214,165

1,90038

370,291163,42338,139

272,028

$4,025,843

15

Americans for Prosperity FoundationNotes to Financial Statements

December 31, 201D(See Independent Auditor's Report)

Note N - Unrestricted Net Asset Deficit

The accompanying balance sheet shows a deficit balance in unrestricted net assets. As of the date ofthese financial statements, the unrestricted change in AFPF's net assets was sufficient to eliminatethis deficit.

16

:

/ cI Q'/

Ott Z14(

Americans for Prosperity. ;Foundation •2111 Wilson Blvd, Suite 350

Arlington, VA 22201

Purpose: To educate consumers, businessowners and the general public about the valueand operation of an open and market-orientedeconomy that is free of government interference.

!til'a 1111 NitF11i1I liii I1i IIIF D II N U A 110. N

I

BOARD OF DIRECTORS

David KochChairmanAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

Art PopeVice ChairmanAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

Dr. Richard FinkDirectorAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

Debra Gail HumphreysDirectorAmericans for Prosperity FoundationSuite 350,2111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

Cy NoblesDirectorAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

Dr. Walter WilliamsDirectorAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

OFFICERS

Tim PhillipsPresidentAmericans for Prosperity FoundationSuite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

John FlynnSecretary/TreasurerAmericans for Prosperity Foundation,Suite 3502111 Wilson Blvd.Arlington, VA 22201(703) 224-3200

ALTERNATE ADDRESS FOR ALL:807 Brazos Street, #210Austin, TX 78701-9996(512) 476-5905

I INk VI1I1i1i 1111 ill 11F U ii N 01 A I I U N QD

NATIONAL OFFICE2111 Wilson Blvd.Suite 350Arlington, VA 22201Office: (703) 224-3200Fax: (703) 224-3201Toll Free: (866) 730-0150

STATE OPERATIONS:

ARIZONATom JenneyOne East Camelback RoadSuite 550Phoenix, AZ 85012Office: (602) 478-0146tjenney@afphg.org

ARKANSASTeresa Oelke1800 S. 52nd St., Ste. 300Rogers, AR. 72758Office: (479) 531-9778toe]keafphq.orginfoAR@afphg.org

CALIFORNIADavid Spady2073 Santo DomingoCamarillo, CA 93012Cell: (805) 427-4424Office: (805) 384-4510dspadv@afphg.org

COLORADOJeff CrankP0 Box 88003Colorado Springs, CO80908Office: (719) 494-0797Fax: (719) 495-5041jcrankafphg.org

FLORIDASlade O;BrienP.O. Box 185Tallahassee, FL 32302sobrien@afphg.org

GEORGIAVirginia Galloway44 Darby's Crossing DriveSuite 102-GHiram, GA 30141Office: (770) 315-4304infoGA@afphg.org

ILLINOISJoe Calomino118 N. Clinton StreetSuite 140Chicago, IL 60661Office: (312) 768-2373Fax: (312) 463-1341jcalomino@afphg.org

KANSASDerrick Sontag2348 SW TopekaSuite 201Topeka, KS 66611Office: (785) 354-4237Fax: (785) 354-4239dsontag@afphg.org

Wichita Office151 Whittier StreetWichita, KS 67207Office: (316) 681-4415dsontag(afphg.org

MAINECarol WestoninfoMEafhg.org

MARYLANDCharles LollarOffice: (443) 994-9395infoMDcafphg.org

MICHIGANScott Hagerstrom222 W GeneseeLansing, MI 48933Office: (517) 410-8359Fax: (517) 827-0603shagerstrom@afphg.org

MISSOURIPatrick WernerOffice: (314) 780-7687infoMO@afphg.org

MONTANAScott Sales5200 Bostwick RoadBozeman, MT 59715Office: (406) 579-7994ssales@afphg.org

NEBRASKAMike FriendinfoNE@af±g.org

NEVADAAdam Stryker231 W. Charleston Blvd.#130Las Vegas, NV 89102Office: (702) 518-3660infoNV@afphg.org

NEW HAMPSHIRECorey LewandowskiCell: (202) 550-7839c1ewandowski@afbhg.org

NEW JERSEYSteve Lonegan24 River Road #205Bogota, NJ 07603Office: (201) 487- 8844Fax: (201) 487- 8853ccampbell@afphg.org

NORTH CAROLINADallas Woodhouse200 West Morgan StreetSuite 100Raleigh, NC 27601Office: (919) 839-1011Fax: (919) 839-1012dwoodhouseafphg.org

0mbRebecca HeimlichOffice: (513) 703-6227rheimlich@afphg.org

OKLAHOMAStuart Jolly1050 East 2nd Street #106Edmond, OK 73034Office: (405) 974-5164sjolly@afphg.org

OREGONKarla Kay EdwardsP.O. Box 116Williamina, OR 97396Office: 503-537-8108inf6OR(a1hg.org

PENNSYLVANIASam Rohrer4020 Main StreetBox 190Elverson, PA 19520infoPAafbhg.org

TENNESSEEBrad Stevens1605 Silver Oak LaneLenoir City, TN 37772(865) 288-0988bstevens(afhg.org

TEXASPeggy Venable807 Brazos Street, #210Austin, TX 78701-9996Office: (512) 476-5905Fax: (512) 476-5906pvenable@afphg.org

VIRGINIATrixie AverillP.O. Box 278Vinton, VA 24179-0278Office: (804) 506-0237infoVA®afhg.org

WASHINGTONNansen MilanP.O. Box 117Seaview, WA 98644Phone: (360) 244-3294infoWA@afphg.org

WISCONSINMatt Seahoim1126 South 70th StreetSuite 5219AMilwaukee, WI 53214Office: (414) 476-7900infoWJafphg.org

AMERICANS FOR PROSPERITY FOUNDATION

Relationship Statement in Response to Question 14 (A)(1) ofthe URS Form: Americans for Prosperity Foundation Boardmember Richard Fink is the father of Americans forProsperity Foundation employee Chris Fink. Chris Finkstarted working with AFPF in 2008. Both can be reached atthe Foundation:

2111 Wilson Blvd., Suite 350Arlington, VA 22201703 224-3200

ResponsibilityAmericans for Prosperity Foundation

Individual responsible for custody of funds:Steve Corder, Chief Financial OfficerAmericans for Prosperity Foundation2111 Wilson Blvd., Suite 350Arlington, VA 22201

Individual responsible for fundraising:Tim Phillips, PresidentJ.P. DeGance, Vice President, External AffairsAmericans for Prosperity Foundation2111 Wilson Blvd., Suite 350Arlington, VA 22201

Individual authorized to sign checks:John Flynn, Secretary/TreasurerSteve Corder, Chief Financial Officer

Individual responsible for distribution of funds:Steve Corder, Chief Financial OfficerAmericans for Prosperity Foundation2111 Wilson Blvd., Suite 350Arlington, VA 22201

Individual responsible for custody of financial records:Steve Corder, Chief Financial OfficerAmericans for Prosperity Foundation2111 Wilson Blvd., Suite 350Arlington, VA 22201

Bank in which funds are deposited:Chain Bridge Bank, N.A., McLean, VirginiaAccount #2100106091(703) 748-2005

F 0 II NO AT! ON1726 M Street NW, 10th Floor . Washington, DC 20036 202.349.5880

Response to Question 18(A) on URS

October 17, 2008

State of Alaska - Department of LawCommercial & Fair Business Section1031 W. 4" Avenue, Suite 200Anchorage, AK 99501

Dear Sir or Madam

We are in receipt of your postcard pertaining to Americans for Prosperity Foundation'scharitable registration in the state of Alaska.

In your note, you have requested an explanation related to question ISA of the unifiedregistration statement, in which we responded "yes." The question pertained to whetherAmericans for Prosperity Foundation (AFPF) received financial support from othernonprofit organizations. Please note that AFPF receives a number of confidentialcontributions from private foundations, but does not receive financial support from publiccharities or combined campaigns. The private foundations have a donor relationship withAFPF. Please note that no private foundations in the state of Alaska have given financialsupport to AFPF.

I trust that this satisfies your request and that Americans for Prosperity Foundation willnow be deemed in full compliance with Alaska's charitable registration laws. Thank youfor your attention to this matter.

Sincerely,

' abni. Flynn, HICorporate Secretary/Treasurer

Internal Revenue Service

Date: March 19, 2004

Americans for Prosperity Foundation.1726 M St. NW, 10' FloorWashington, DC 20036

Dear Sir or Madam:

Department of the TreasuryP. 0. Box 2508Cincinnati, OH 45201'1.

Person to ContactMs. Smith #31-07262Contact Representative

Toll Free Telephone Number;8:00 am. to 6:0 p.m. CST877-829-5500

Fax Number.513-263-3756

Federal Identification Number:52-1527294

This is in response to the amendment to your organization's Articles of Incorporation filed with the state onNovember 20, 2003. We have updated our records to reflect the name change as indicated above.

In January 1988 we issued a determinétion letter That recognized your organization as exempt from federalIncome tax. Our records indicate thatyour organization is currently exempt under section 501(c)(3) of theInternal Revenue Code.

Based on information subsequently submitted, we classified your organization as one that is not a privatefoundation within the meaning of section 509(a) of the Code because it is an organization described insections 509(a)(1) and I T0(b)(1 )(A)(vi).

This classification wasbased onthe assumption ttiatyourofganizatfons.operaUonswoutd cnUnueatatedin the application If your organization's sources of support 1 or ts ctaracter, method of operations 1 or purposhave changed, please let us know so we can consider The eftectofthe change on the exempt status andfoundation status of your organization.

grseTcetpt . each year lire:iiclay oftheiifflmdnth ftr thef$2Oa dy,uptä a.tnairnUrn

delay.

All exempt fr tx under the Federal InsuranceContributions Act (social secunty taxes) qn remuneration t$10Q or mare paid to each employee during acalendar year. Your organization is not liable for the tax imposed under the Federal Unemployment lax Act(FUTA).

Organiaflons that are not private foundations are not subject to the excise taxes under Chapter 42 of theCode. However, these organizations are not automatically thcempt from other federal excise taxes.

in section 170 of the Code. Bequests,legaclesF vses transfers or rft to your oianlzation or for its use are deductible far federal estate and gift

rpf:.th:1iiGet the a bIMelons:of sections 2055, 2106. and 2522 of the Code.

tha•

i

I

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Q

-2- ;t ..

Americans for Prosperity Foundation52-1527294

Your organization is not required to file federal income tax returns unless it is subject to the tax on unrelatedbusiness income under section 511 of the Code. If your organization Is subject to this tax, it must file anincome tax return on the Farm 990-T, Exempt Organization Business Income Tax Return. In this letter, we arenot determining whether any of your organization's present or proposed activities are unrelated trade orbusiness as defined'in section 513 of the Code.

Seotian: 6104t: of the -Internal: Revenue:. -requires you to make -your organization's annual return availa fefgr puf?licinspection without charge for three years :after -the:due clue of the ;return:: The also requiresorganizations that received recognition of exemption rf:July 15. 1981, or later, to make available `for 'public

ihdussuáhdqcumsiitstri .fa rs i ir;in.+ivritirig;.: c rgaialzations #hat roc ived:recpgnifro .. 'fecemptiohf e`fdr..July :J5,1.98 ,end tad a copy-afthen` xetnptioi application on July 15,''i987',;are alsorequired t make v Habl fc c ^ul}litr i s ectton a copy of the exemption application, any . supporting documentsand the exrriptron letter to any individual who-requests such documents in person cnn writing::.F '.additional irmafoh on c scfosure:regta yeti nth, please refer to'(nterrral t Menu :Bulttiri' 93.-17;

Because this letter could help resolve any questions about your organization's exempt status and foundationstatus, you should keep it with the organization's permanent records.

If you have any questions, please call us at the telephone number shown In the heading of this letter.

This letter affirms your organization's exempt status.

Sincerely,

Janna K. Skufca, Director, TEFGECustomer Account Services

FL

GA

HI

IA

ID

IL

KS

KY

LA

MA

Dept. of Agriculture & Consumer ServicesConsumer Affairs2005 Apalachee ParkwayTallahassee, FL 32399-6500

Secretary of StateDivision of Securities & Business Regulation237 Coliseum DriveMacon, GA 31217-3858

State of HawaiiDepartment of the Attorney General425 Queen StreetHonolulu, HI 96813

Dept. of JusticeConsumer Protection DivisionHoover BuildingDes Moines, IA 50319

Office of the Attorney GeneralConsumer Protection UnitLen B. Jordan BuildingBoise, ID 83729-0010

Office of the Attorney GeneralCharitable Trust & Solicitation Bureau100 W Randolph Street, 11th FloorChicago, IL 60601-3175

Secretary of StateCorporation DivisionMemorial Hall, 1" Floor120 SW 10th Ave.Topeka, KS 66612-1594

Office of the Attorney GeneralConsumer Protection Division1024 Capital Center Dr.Frankfort, KY 40602

LA Dept of JusticeOffice of the Attorney GeneralConsumer Protection Division1885 North 3rd StreetBaton Rouge, LA 70802

Dept. of the Attorney GeneralDivision of Public CharitiesOne Ashburton PlaceBoston, MA 02108

kR CH 4994

R CH 07960

R

R CO 01027277

R 219-527-9

R

R 033312

MD State of MarylandCharitable Organization DivisionState HouseAnnapolis, MD 21401

ME State of MaineDept. of Professional & FinancialRegistrationCharitable Solicitations35 State House StationAugusta, ME 04333

MI Attorney General of MichiganCharitable Trust Section525 W. Ottawa6th Floor, Williams BuildingLansing, MI 48933

MN Office of the Attorney GeneralCharities DivisionNCL Tower445 Minnesota Street, Suite 1200St. Paul, MN 55101-2130

MO Office of the Attorney GeneralSupreme Court Building207 WHigh StreetJefferson City, MO 65 102-0899

MS Secretary of State, Regulation & EnforcementCharity Registration700 North StreetJackson, MS 39202

NC Secretary of StateCharitable Solicitation Division2 South Salisbury StreetSuite 5018Raleigh, NC 27601

ND Secretary of State600 East Blvd.Bismarck, ND 58505-0500

NE Secretary of StateSuite 2300Capital BuildingLincoln, NE 68509-4608

NH Dept. of JusticeCharitable Trust Dept.33 Capital StreetConcord, NH 03301-6397

R 1177

R CO 6177

R MJCS 10799

R

R 100000505

R SL 001530

R 11487100

R 5435

R 1177

R CO 6177

R MICS 10799

R

R

R 100000505

R , SL 001530

R 11487100

R 5435

MD State of MarylandCharitable Organization DivisionState HouseAnnapolis, MD 21401

ME State of MaineDept. of Professional & FinancialRegistrationCharitable Solicitations35 State House StationAugusta, ME 04333

MI Attorney General of MichiganCharitable Trust Section525 W. Ottawa6th Floor, Williams BuildingLansing, MI 48933

MN Office of the Attorney GeneralCharities DivisionNCL Tower445 Minnesota Street, Suite 1200St. Paul, MN 55101-2130

MO Office of the Attorney GeneralSupreme Court Building207 W High StreetJefferson City, MO 65102-0899

MS Secretary of State, Regulation & EnforcementCharity Registration700 North StreetJackson, MS 39202

NC Secretary of StateCharitable Solicitation Division2 South Salisbury StreetSuite 5018Raleigh, NC 27601

ND Secretary of State600 East Blvd.Bismarck, ND 58505-0500

NE Secretary of StateSuite 2300Capital BuildingLincoln, NE 68509-4608

NH Dept. of JusticeCharitable Trust Dept.33 Capital StreetConcord, NH 03301-6397

NJ Division of Consumer AffairsCharitable Registration124 Halsey Street, 7th FloorNewark, NJ 07101

NM Office of the Attorney GeneralRegistry of Charitable Organizations111 Lomas Blvd NWSuite 300Albuquerque, NM 87102

NV Office of the Attorney General100 N. Carson StreetCarson City, NV 89701

NY Office of the Attorney GeneralCharities Bureau120 BroadwayNY, NY 10271

OH Office of the Attorney GeneralCharitable Foundation Section150 E.. Gay Street, 23rd Floor

.Columbus, OH 43215-3130

OK Secretary of StateCharities Division2300 N. Lincoln Blvd.Room 101Oklahoma City, OK 73105-4897

OR State of OregonDept. of JusticeCharities Activities Section1515 SW 5th Ave., Suite 410Portland OR 97201-5451

PA Dept. of StateBureau of Charitable Organizations207 North Office BuildingHarrisburg, PA 17105

RI Dept. of Business RegulationsSecurities DivisionCharitable Organization Section1511 Pontiac Ave.John 0. Pastore Complex, Bldg 69-1Cranston, RI 02920

Sc Secretary of StatePublic Charities Section1205 Pendleton StreetSuite 525Columbia, SQ 29201

R CH 0529400

R

R 16-40-53

R 03-2379

R 4312172760

R 20731

R 12786

R 95-0311

R P23

SD Office of the Attorney GeneralDivision of Consumer Protection500 East CapitolPierre, SD 5750 1-5070

TN Secretary of State R 1314Charitable SolicitationWilliam R. Snodgrass Tower, 8th Floor312 Rosa L. Parks AvenueNashville, TN 37243

UT Dept. of Commerce R 6538700-CHARDivision of Consumer Protection160 East 300 SouthSalt Lake City, UT 84114-6704

VA Office of Consumer Affairs RDept. of Agriculture & Consumer Services102 Governor Street, Lower LevelRichmond, VA 23219

VT Office of the Attorney 'General109 State StreetMontpelier, VT 05609

WA Office of the Secretary of State R 934Charitable Solicitations & Trusts801 Capitol Way SouthOlympia, WA 98504

WI Dept. of Regulations & Licensing R 5164Charitable Organizations1400 B. Washington Ave.Madison, WI 53703-3041

WV Secretary of State R1900 Kanawha Blvd. EastState Capitol Bldg 1, Suite 157-KCharleston, WV 25305-0770

WY Secretary of StateState Capital Building200 W 24 StreetCheyenne, WY 82002-0020

9lE111Msor SS.

3Ø47

DATE: 04-12-04

2132765 8100H

040266164

DeCaware- PAGE 1

'ITie Irst State

I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF

DELAWARE, DO HEREBY CERTIFY THE ATTACHED ARE TRUE AND CORRECT

COPIES OF ALL DOCUMENTS ON FILE OF "]JI.9 FOR PROSPERITY

FOUNDATION" AS RECEIVED AND FILED IN THIS OFFICE,

THE FOLLOWING DOCUMENTS HAVE BEEN CERTIFIED:

CERTIFICATE OF INCORPORATION, FILED THE TWENTY—SECOND DAY OF -

JULY, A.D. 1987, AT 9 O'CLOCK A.M.

CERTIFICATE OF AMENDMENT, CHANGING ITS NAME FROM "CITIZENS

FOR A SOUND ECONOMY EDUCATIONAL FOUNDATION" TO "AMERICANS FOR

PROSPERITY FOUNDATION", FILED THE TWENTIETH DAY OF NOVEMBER,

A.D. 2003, AT 5:02 O'CLOCK P.M.

AND I DO HEREBY FURTHER CERTIFY THAT THE AFORESAID

CERTIFICATES ARE THE ONLY CERTIFICATES ON RECORD OF THE

AFORESAID CORPORATION.

4,

w.

1••I'7L5 1.W7C/'

CERTIFICATE OF INCORPORATION

FILEDAL 22.:icr

OF

CITIZENS FOR A SMIINM ECONOMY EDUCATIONAl. FOIJNI)ATTON

We, the undersigned natural persons of the age of 21 years

or more ' acting as incorporators of a non-prnflt, non-Stock

corporation do hereby adopt the fo1lowinr Article.-; of Incorpor-

ation for such corporation pursuant to the Oenir.'d Corporation

Law, of -the State of Delaware.

FIRST: The name of the corporation is:

CITPIRNS FOR A SOUND E.)NOMY FixicivrIONAL FOUNDATION

SECOND: The period of duration is perpetual.

thR'D. The specific and primary purposis for which this

corporation is formed and for which it shall he exclusively

drninistered and operated are to rceivc, administer and expend

funds for charitable and educationa) purposes, including the

U.) t rowing:

). To educate consumers, business owners, and the general

public about the value and operation of an open and market-

oriented economy that Is free of government interference.

2. To assist by contributions of money or services to

other organizations that are exempt from Income tax under

section 501(c)(3)of the Internal Revenue Code of 1986,

'.4

-A.

-2-

3. To engage in any and all lawful activities for

which corporations may be organized under the General

Corporation Law of Delaware incidental to the foegoing

purposes Pxcept as restricted herein.

In order to accomplish the foregoing charitable and

educational purposes, and ' For no other purpose or purposes, this

corporation shall also have the power to:

(a) sue and be sued;

(1) make contracts;

(C) receive property by devise or bequest, subject

to the laws regulating the transfer of property by will, and

nth.rwisn acquire and hold all property, real or personal,

including shares of stock, bonds and securities of other

corporations;

(d) act as trustee under any trust whose objects

are related to the principal objects of the corporation, and

to receive, hold, administer and expend funds and property

subject to such trust;

(e) convey, exchange, lease, mortgage, encumber,

transfer upon trust or otherwise dispose of all property,

real, or personal.;

(f) borrow money, contract debts and issue bonds,

notes, and debentures, and secure the payment of any perform-

ance of its obligations and

(g) do all other acts necessary or expedient for the

administration oE the affairs and attainment of the purposes of

this corporation; provided, however, that this corporation

shall not, except to an insubstantial degree, engage in any

activities or exercise any powers that are not in furtherance

of the primary purposes of this corporation.

FOURTH: The corporation shall have no authority to

issue capital stock,

FIFTH: No part of the net income of the corporation

shall inure to the benefit of or be distributable to its directors,

officers, or other private persons, except that tho corporation

shall he authorized and empowered to pay reasonable compensation

for services actually rendered and to make payments and distri-

butions in furtherance of the purposes and objects set forth in

• Article THIRD hereof. No substantial part of the activities of

the corporation shall he the carrying on of propaganda or other-

wise attempting to influence legislation, and the corporation

shall not parUcipate in or intervene in any political campign

on behalf of any candidate for public -office.

Lim ..:

-4-

Notwithstanding any other provisions set forth in these

Articles of Incorporation, at any time during which it is

deemed a private foundation, the corporation shall distribute

its income for each taxable year at s.ich time and in such

manner as not to become subject to the tax on undistributed

income imposed by Section 4942 of the Internal Revenue Code of

1986 the corporation-shall not engage in any act if self-

dealing as defined in Section 4941(d) of the Internal Revenue

Codt of 1986; the corporation shall not own any excess business

holdings that would subject it to tax under Section 4943 of the

internal Revenue Code of 1981; the corporaticn shall not make

any investments in such manner as to subject: t.m corporation to

the tax imposed by Section 4944 of the Internal Revenue Code of

996; anti the corporation shall not make any taxanle expenditures

as defined in Section 4945(d) of the Internal Revemle Code of

19R. Any reference in this Certificate to the Internal Revenue

Code of 1986 shall he deemed to include corresponding provisions

of any subsequent federal tax laws.

SIXTH: a) The business, property, and affairs of the

corporation shall be controlled by Its Board of Trusteesi themanner of their election or appointment, other than the initial

Hoard of Trustees provided for herein, shall he as provided in

the Bylaws.

0

9

C

r ,h«.

{b) Subject to the direction and approval of the Board of

Trustees, the business, property, and affairs of the corporation

shall be managed and supervised by a Board of Directors; their

manner of election or appointment shall be as provided in theBylaws.

(c) Elections of trustees and directors need not he bywritten ballot. The Board of Trustees shall have the power toadopt, amend, or repeal byla ys. In furtherance and not in

limitation of the powers conferred by statute, the corporationis expressly authorized to carry on its business and to holdannual or special meettncs of its Board of Trustees or Directors

either within or out of a,iy of the, states, territories or

possessions of the United States, or the District of Columbia.

{d) No trustee or director of the corporation shall be

liahle.to the corporation for monetary damages for any breach

of his fiduciary duty as a trustee or director; provided, thatthis paragraph shall not elnminatc' any liability of a trusteeor director (i) for any breach of the trustee's or director's

duty of loyalty to the corporation: (ii) for acts or omissionsnot in good faith or that invoi.e intentional misconduct or a

knowing violation of the law; (ii!) under section 174 of the

General Corporation Laws of Delaware, for un?aw€ul payments ofdividends or unlawful stock purchases or redemptions; or (iv)for any transaction from which the trustee or director derivedan improper personal benefit.

WA

-6-

SEVENTH: The private property of the incorporator, trustees,

directors, and officers shall not be subject to the payment of

corporate debts to any extent whatever.

EIGHTH: Notwithstanding any other provision of these

Articles, the corporation shall not conductor carry on any

activities not permitted to he conducted or carried on by an

organization exempt from tax under Section 501(c(3) of the

Internal Revenue Code of 19R, or by an organization contri-hut ions to which are to he deductible under Sect-ion 170(c)(2)

of such Code.

NINTH: Upon the dissolution of the corporation or tht

winding up o its affairs, the assets of the corporation shall

be distributed exclusively for charitable or educational purposes

or to organizations which are then exempt from federal tax under

Section 501(c)(3) of the Internal Revenue Code of 1956 and to

which contributions are then deductible -under Section 70(c)(2)

of such Code.

TINTN: The address, including the st-eet and number of

its initial registered office is 229 south State Street, flove,

Delaware 19901, County of Kent, and tha name of its initial

registered agent is The Prentice-Hall Corporation System, Inc.

.J..

a

- 7'. -

St.EVF.NTH: The corporation reserves the right to amend,

change or repeal any provision contained in these Articles of

Incorporation or to merge or consolidate this corporation with

any "ether nonprofit corporation in the mannncr now or hereafter

prescribed by statute, provided, however, that any such action

shall be calculated exclusively to carry out the objects and

purposes for which the corporation is formed, and all rights

herein conferred' or granted shall he subject to this reservation.

TWELFTH: The number of trustees constituting the initial

Board of Trustees is one (fl, hut the number of trustees may he

increased or decreased in the iiannr set forth in Ehe bylaws,

provided that the number shall not he less than one. The name

and street address of the person who is to serve as the initial

trustee is

NAME. ADDRESS

Alan P. Dye 1747 Pennsylvania Avenue, N.H.

suite 1000Washington, D.C. 20006

THIRTEENTH: The name and street addre of the incorporator

Is:

ADDRESS

Alan P. Dye

1747 Pennsylvania Ave., N.W. 1.

Suite 1000Washington, D.C. 20006

• Dated: It ''7 . •:'(Inco'porato :

I.

•-

I.k.

FROM 1AEGBE & BEN U ON (TH(J)tI. 203 155/ST. tt:y'ttJ. 4tS0zU1411 r

STATE OF DELAWARECERTIFICATE OF AMENDMENT

(A CORPORATION WITHOUT CAPITAL STOCK)

Citizens for a Sound Economy Educational Foundation, a corporation organized andeodsdng under the laws of the Slate of Delaware, hereby certifies as follows:

(1) That at said meeting a vote of the members of the governing body was takenfor and against the aniendxnent to the Certificate of 1ncoTpoaUcrn, aaid Amendment being asfollows:

Article FIRST of the Certificate of Incorporation of this corporation Isdeleted ifl its entirety and the following inserted in lieu thcreof.

FIRST: Thc name of the corporation is: Americans for ProsperityFoundation.

(2) That said amendmt was duly adopted in acordancc with the provisions ofSection 242 of th General Corporation Law of the State of Delaware.

.yU.: •B.O . id.Citizens for a Sound Economy EducationalFoundatlon ha caused this ccrbcato to be sigoed by Wayne Gable, an authorized ofilcex',

A.. -202003.

AzedOffierName: Wayne Gable, Vico Chairman.

Mt:t00010.0j

State of DelawareSoaretazy of State

Division of Corporat.jonsDelivered 05:02 PH 1112012003

FILED 05:02 PM 1112012003SRV 030749276 - 2132765 FILS

BYLAWS

OF

CITIZENS FOR A SOUND ECONOMY EDUCATIONAL FOUNDATION

: ARTICLE I•

OFFICES

The principal office of the Corporation shall be in the

District of Columbia. The Corporation may have such other

- offices either within or without the State of Delaware as the

Board of Trustees or Directors may determine from time to time.

ARTICLE II

BOARD. OF TRUSTEES

1. General Authority. There shall be a Board of Trustees

of the Corporation, which shall generally control the business,

property, and affairs of the Corporation. The Board of Trustees

shall be vested with the powers possessed by the Corporation

itself, including the powers to determine the policies of the

Corporation and prosecute its purposes, to appoint and remunerate

agents and employees, to disburse the funds of the Corporation,

and to adopt such rules and regulations for the conduct of its

business, responsibility, and authority as shall be deemed

advisable, insofar as such delegation of authority is not

inconsistent with or repugnant to the Certificate of Incorporation

or Bylaws of the Corporation (in their present form or as they

may be amended), or to any applicable law.

-2-

2. Membership. The Board of Trustees of the Corporation

shall be composed of at least one individual, commencing with

the initial Trustee named in the Certificate of Incorporation

of the Corporation. The initial Trustee shall appoint four

trustees (other than himself), at which time his power to act

shall terminate, and the Board of Trustees shall thereafter be

composed of at least three individuals. Vacancies, as they

occur on the Board of Trustees by resignation, removal, death,

incapacity, or the like of one or more of the members thereof,

shall be filled by act of a majoritykof the remaining trustees.

3. Term of Office. Each member-of the Board of Trustees

of the Corporation (other than the initial Trustee) shall serve

for a term of three years. They Trustees shall establish a

procedure so that one-third of the membership of the Board of

Trustees is elected each year. \

4. Resignation. Any Trustee may resign at any time by

giving written notice to the President. Such resignation shall

take effect at the time specified therein; or if no time is

specified, at the time of acceptance thereof as determined by the

President or Board of Trustees.

-3-.

5. Removal. Any trustee may be removed from such office

by a two-thirds vote of the trustees at any regular or special

meeting of the Board of Trustees at which a quorum is present,

for (1) violation of these Bylaws or (2) engaging in any other

conduót prejudicial to the best interests of the Corporation.

6 Regular Meetings. A regular meeting of the Board of

Trustees of the Corporation shall be held each year, at such

time, day, and place as shall be designated by the Board of

Trustees, for the purpose of transacting such business as may

come before the meeting. The Board of Trustees may, by

resolution, provide for the holding of additional regular

meetings.

7. Special Meetings. Special meetings of the Board of

Trustees may be called at the direction of the President or by

a majority of the voting trustees then in office, to be held at

such time, day, and place as shall be designated in the notice

of the meeting.

8. Notice. Notice of the time, day, and place of any

meeting of . the Board of Trustees shall be given at least ten

days previous thereto by notice sent by mail, telegram, or tale-

phone to each trustee at his or her address as shown by the

records of the Corporation. If mailed, such notice shall be

deemed to be delivered when deposited in the United States mail

in a sealed envelope so addressed, with postage thereon prepaid.

If notice be given by telegram, such notice shall be deemed to

be delivered when the telegram is delivered to the telegraph

company. The purpose or purposes for which a special meeting

is called shall be stated in the notice thereof. Any trustee

may waive notice of any meeting. The attendance of a trustee

at any meeting shall constitute a waiver of notice of such

meeting, except where a trustee attends a meeting for the

express purpose of objecting to the transaction of any business

because the meeting is not lawfully called or convened.

9. Quorum. A majority of the trustees shall constitute a

quorum for the transaction of business at any meeting of the

Board of Trustees, except if less than such number of trustees

is present at such meeting, a majority of the trustees present

may adjourn the meeting from time to time without further

notice.

10. Manner of Acting. Each trustee shall have one vote.

The act of a majority of trustees at a meeting of the Board of

Trustees shall be the act of the Board of Trustees. Trustees

may attend a meeting by telephone or similar equipment by means

-- 5-

of which all persons participating in the meeting can hear each

other. In the absence of a quorum, any action taken shall be

recommendatory only, but may be ratified by a majority vote

of the Board of Trustees at a subsequent meeting at which a

quorum is present.

11. Informal action. Any action required by law to be

taken at a meeting of the Board of Trustees, or that may be

taken at a meeting of the Board of Trustees, may be taken

without a meeting if a consent in writing, setting for the

action so taken, is signed by all of the Trustees.

12. Compensation. Trustees shall not receive any compen-

sation for their services as members of the Board of Trustees,

but the Board of Trustees may authorize payment by the Corporation

of the expenses of trustees for attendance at regular or special

meetings of the Board. However, nothing herein contained shall

preclude a Trustee from serving the Corporation in any other

capacity and receiving reasonable compensation therefor.

ARTICLE III

BOARD. OF ..DIRECTORS

1. General Authority. Subject to the direction and approval

of the. Board of Trustees, the property, affairs, and business

of the Corporation shall be managed by its Board of Directors.

The Board of Directors may by general resolution delegate to

officers of the Corporation and to committees such powers as

provided for in these Bylaws.

-6-

2. Membership. The number of Directors shall be no less

than three, and may be increased, as shall be decided by the

directors from time to time. Vacancies among the Directors,

whether caused by resignation, death, removal, or expiration of

a term, may be filled by a majority vote of the Board of

Trustees.

3. Terms. The Directors shall serve terms of three years

or until their successors are elected and qualified. Directors

may succeed themselves in office. The Board of Trustees shall

establish a procedure so that one-third of the membership of

the Board of Directors is elected eacIi year.

4. Resignation. Any Director may resign at any time by

giving written notice to the President. Such resignation shalL

take effect at the time specified therein, or, if no time is

specified, at the time of acceptance thereof as determined by

the President or Board of Trustees.

5. Removal. The vote of a majority of the number of

the Trustees established by these bylaws shall be required to

remove a Director from office prior to the expiration of the

term for which that Director has been elected. Such removal

may only be on account of (1) violation of these bylaws, or (2)

engaging- in any other conduct prejudicial to the best interests

of the Corporation.

9

-7-

6. Meetings. (a) The Board of Directors shall provide by

resolution the time and place, whether within or without the

State of Delaware, for the holding of at least one regular

meeting of the Board each year.

(b) Special meetings of the Board of Directors may

be called by the President, or by a majority of the voting

Directors then in office, who may fix any place, whether within

or without the State of Delaware, as the place for holding any

special meeting.

7. Notice. Notice of any meetirg of the Board of Directors

shall be given at least ten days previous thereto by written

notice delivered personally or sent by mail, telegram, or

telephone to each Director at his address as shown by the

records of the Corporation. If mailed, such notice shall be

deemed to be delivered when deposited in the United States mail

in a sealed envelope so addressed, with postage thereon prepaid.

If notice be given by telegram, such notice shall be deemed to

be delivered when the telegram is delivered to the telegraph

company. Any Director may waive notice of any meeting. The

attendance of a Director at any meeting shall constitute a

waiver of notice of such meeting, except where a Director

attends a meeting for the express purpose of objecting to the

transaction ofof any business because the meeting is not lawfully

called or convened. The business to be transacted at, or the

purpose of, any special meeting of the Board of Directors shall

be specified in the notice or waiver of notice of such meeting.

8. QuoruiIi. The presence in person of a majority of the

Board of Directors shall constitute a quorum for the trans-

action of business at any meeting of the Board but if less

than a majority of the Directors are present in person at said

meeting, a majority of the Directors present may adjourn the

meeting from time to time without further notice.

9. manner o Actin2. Each Director shall have one vote

The act of a majority of the Directors present at a meeting at

which a quorum is present shall be the act of the Board of

Directors, unless the act of a greater number is required by

law or by these Bylaws. Directors may attend a meeting by

telephonic or similar equipment by means of which all persons

participating in the meeting can hear each other. In the

absence of a quorum, any action taken shall berecommendatory

only, but may be ratified by a majority vote of the Board of

Directors at a subsequent meeting at which a quorum is present.

10. Informa1 ' Action, Any action required by these bylaws

1 to be taken at a meeting of Directors, or any action that may

be taken at a meeting of Directors, may be taken without a

meeting if a consent in writing, setting forth the action so

taken, is signed by all of the Directors.

11. Compensation. Directors shall not receive any stated

salaries for their services as such, but by resolution of the

Board of Directors a fixed sum and expenses of attendance may

be allowed for attendance at each regular or special meeting of

the Board. However, nothing herein contained shall be construed

to preclude any Director from serving the Corporation in any

other capacity and receiving reasonable compensation therefor.

ARTICLE IV

OFFICERS.

1. Officers. The officers of the Corporation shall be a

President, a Vice President, a Secretary, a Treasurer, and such

other officers as may be elected in accordance with other

provisions of this Article. The Board of Directors may appoint

such other officers or agents, including a Chairman of the

Board, an Executive Director, one or more Vice Presidents, one

or more Assistant Secretaries, and one or more Assistant Treasur-

ers, as it shall deem desirable, and such officers shall have

- 10 -

the authority and perform the duties prescribed from time to

time by the Board of Trustees orDirectors. Any two or more

offices may be held concurrently by the same person, except the

offices of President and Secretary.

2. Election. The officers of the Corporation shall be

elected annually by the Board of Directors at the annual meeting

of the Board. If the election of officers shall not be held at

such meeting, such election shall be held as soon thereafter as

convenient. New offices may be created and filled at any

meeting of the Board of Directors. Each officer shall hold

office until his successor shall have been duly elected andshall have qualified.

3. Removal. Any officer elected by the Board of Directors

may be removed by a majority vote of the Trustees or Directorswhenever the officer has engaged in conduct prejudicial to the

best interests of the Corporation, but such removal shall be

without prejudice to the contract rights, if any, of the officer

so removed.

4. Vacancy. A vacancy in any office because of death,

resignation, removal, disqualification or otherwise, may be

filled by the Board of Directors.

P

- 11 -

5. President. The President shall be the principal

executive officer of the Corporation and shall exercise general

supervision over the affairs of the Corporation, its officers,and personnel consistent with policies established by the Board

of Directors. The President may sign any deeds, mortgages,

bonds, contracts, or other instruments, except in cases where

the signing and execution thereof shall be expressly delegated

by the Board of Directors or by these Bylaws or by statute to

some other officer or *agent of the Corporation; and in generalshall perform all duties incident to the office of President

.and such other duties as may be prescribed by the Board of

Directors. The President may authorize and approve expenditures

and take such other steps he or she shall deem necessary to

advance the purposes of the Corporation, provided, suchsteps do

not exceed the scope of authority determined by the Board.

6. Vice President. The Vice President shall perform such

duties as may be assigned by the President or the Board of

Directors.

7. Treasurer. The Treasurer shall be the principal

financial officer of the Corporation and shall have charge and

custody of and be responsible for all funds and securities of

the Corporation; receive and give receipts for moneys due and

- 12 -

payable to the Corporation from any source whatsoever and

deposit all such monies in the name of the Corporation in such

banks, trust companies, or other depositories as shall be

selected in accordance with the provisions of Article VI of

these Bylaws; and in general perform all the duties incidentto

the office of Treasurer and such other duties as from time to

time may be assigned by the President or by the Board of Trustees.

The Treasurer shall be responsible for the administration and

oversight of the Corporations financial records, initiation

of an annual audit, compliance with statutory reporting require-

ments, tax returns, and tax payments.

84 Secretary. The Secretary shall keep the minutes of

the meetings of the Boards of Trustees and Directors and shall

oversee the keeping, preparation, and filing of all other

records required by law or by the policies of the Boards; be

custodian of the corporate records and of the seal of the

Corporation and see that the seal of the Corporation is affixed

to all documents, the execution of which on behalf of the

Corporation under its seal is duly authorized in accordance

with the provisions of these Bylaws; keep a register of the

post office address of each Trustee and Director which shall be

furnished to the Secretary by such Trustee or Director; and in

-13-

general perform all duties incident to the office of Secretary

and such other duties as from time to time may be assigned by

the President or by the Board of Trustees or Directors.

9. AssistantVice Prests,Treasurers, ...app . $ecretarjs.

Each Assistant Vice President, Assistant Treasurer and AssistantSecretary, in general, shall perform such duties as shall be

assigned to him by the Vice President, the Treasurer, or the

Secretary, respectively; or by the President or the Board of

Directors.

10. Bond. Each officer of the Corporation shall be

furnished a fidelity bond in such sum as the Board of Trustees

may prescribe.

ARTICLE V.

COMMITTEES

1. . Authority. (a) The Board of Directors may designate

and appoint one or more committees of its members, each of

which shall consist of two or more persons, which committees,

to the extent provided in said resolution, shall have and

exercise the authority of the Board of Directors in the manage-merit of the Corporation; provided, however, that no such committeeshall have the authority of the Board of Trustees in reference

to amending, altering or repealing the Bylaws; electing, appoint-

ing, or removing any member of any such committee or any Trustee,

- 14 -

Director, or officer of the Corporation; amending the Articles

of Incorporation; adopting a plan of merger or adopting a plan

of consolidation with another corporation; authorizing the

sale, lease, exchange or mortgage of all or substantially all

of the property and assets of the Corporation; authorizing the

voluntary dissolution of the Corporation or revoking proceedings

therefor; adopting a plan for the distribution of the assets of

the Corporation; or amending, altering, or repealing any resolution

of the Board of Trustees which by its terms provides that it

shall not be amended, altered, or repealed by such committee.

The designation and appointment of anÿ such committee and the

delegation thereto of authority shall not operate to relieve

the Board of Trustees or any individual Trustee of any responsi-

bility imposed upon it or him by law.

(b) Other committees not having and exercising the

authority of the Board of Trustees or Directors in the management

of the Corporation may be designated and appointed by by the

President. Membership on such committees need not be limited

to Trustees or Directors, provided that only Trustees or Directors

may vote.

(c) •The Board of Directors shall elect annually two or

more of its members who shall constitute the Executive Committee.

The ExecutiveExecutive Committee may, subject to the provisions of

paragraph (a), exercise the powers of the Board of Directors

when the Board is not in session, reporting to the Board at its

succeeding meeting any action taken. A majority of the members

of the Executive Committee shall constitute a quorum for the

transaction of business. Meetings may be called by the chairman

or by any two members.

2. Term. Each member of a committee shall continue as

such until the next annual meeting of the Directors of the

Corporation and until his successor is appointed, unless the

committee shall be sooner terminated, or unless such member be

removed from such committee, or unless such member shall cease

to qualify as a member thereof. Any member of a committee may

be removed for any or no cause by a majority vote of the Trustees

or Directors.

3. Chairman.. One member of each committee shall be

appointed chairman by the person or persons authorized to appoint

the members thereof.

4. Vacancies. Vacancies in the membership of any committee

may be filled by appointments made in the same manner as provided

in the case of the original appointments.

- 16 -

5. Manner of Acting. Unless otherwise provided in the

resolution of the Board of Directors designating a committee, a

majority of the whole committee shall constitute a quorum and

the act of a majority of the members present at a meeting at

which a quorum is present shall be the act of the committee.

Each committee may adopt rules for its own governance not

inconsistent with these Bylaws or with rules adopted by the

Board of Trustees or Directors.

ARTICLE :..

CONTRACTS, CHECKS, DEPOSITS AND FUNDS

1. Contracj ,. The Board of Directors may authorize any

officer or officers, agent, or agents of the Corporation in addi-

tion to tie officers so authorized by these Bylaws, to enter

into any contract or execute and deliver any instrument in the

- name of and on behalf of the Corporation and such authority may

be general or confined to specific instances.

2. h1á. All checks, drafts, or orders for the payment

of money, notes, or other evidences of indebtedness issued in

the name of the Corporation, shall be signed by such officer or

officers, agent, or agents of the Corporation and in such manner

as shall from time to time be determined by resolution of the

Board of Directors. In the absence of such determination by

the Board of Directors, such instruments shall be signed by the

Treasurer or an Assistant Treasurer and countersigned by the

President or a Vice President of the Corporation.

- 17 -

3. Deposits. All funds of the Corporation shall be

deposited from time to time to the credit of the Corporation in

such banks, trust companies, or other depositories as the Board

of Directorsmay select.

4. Funds.. The Board of Directors may accept on behalf

of the Corporation any contribution, gift, bequest, or devise

for the general purposes or for any special purpose of the

Corporation.

ARTICLE VII

BOOKS. AND RECORDS

The Corporation shall keep correct and complete books and

records of account and shall also keep minutes of .the proceedings

of its Boards of Trustees and Directors, and committees.

ARTICLE VIII

FISCAL YEAR

The fiscal year of the Corporation shall begin on the first

day of January and end on the last day of December.

ARTICLE IX.

SEAL

The Board of Trustees shall provide a corporate seal which

shall be in a form selected by a resolution of the Board of

Trustees.

0

-. 18 -

ARTICLE X

INDEMNIFICATION

1. Third party litigation. The Corporation shall be

authorized to indemnify any present or former trustee, director,

or officer of the Corporation, or other such persons so designated

in the discretion of the Board of Directors, against all expenses

(including attorneys' fees), judgments, fines, and amounts paid

in settlement actually and reasonably incurred by him in connection

with such action, suit or proceeding, provided that he acted in

good faith and in a manner he reasonably believed to be in, or

not opposed to, the best interests of the Corporation.

2. Fiduciary claims. The Corporation shall be authorized

to indemnify any present or former trustee, director, or officer,

or other such persons so designated in the discretion of the

Board of Trustees, who was or is a party or is threatened to

be made a party to any threatened, pending, or completed action

or suit by or in the right of the corporation to procure a

judgment in its favor by reason of the fact that he is or was a

director, officer, employee or agent of the corporation, against

expenses (including attorneys fees) actually and reasonably

incurred by him in connection with the defense or settlement of

such action, suit, or proceeding.

- 19 -

3, éticiàn. The indemnification otherwise authorized

by sections 1 and 2 of this Article shall be authorized only if

the Board of Trustees, acting by a quorum consisting of dis-

interested Trustees, or it they are unable to act, the corporation's

independent legal counsel, determines that he acted in good

faith and in a manner he reasonably believed to be in, or not

opposed to, the best interests of the Corporation, and, with

respect to any criminal action or proceeding, had no reasonable

cause to believe his conduct was unlawful. If the Board of

Trustees makes such a determination, it may rely on the advice

of independent legal counsel as to all questions of law. The

termination of any action, suit, or proceeding by judgment,

order, settlement, conviction, or upon a plea of nolo contendere

or its equivalent, shall not, of itself, create a presumption

that the person did not act in good faith and in a manner which

he reasonably believed to be in or not opposed to the best

interests of the Corporation, and, with respect to any criminal

action or proceeding, had reasonable cause to believe that his

conduct was unlawful. Notwithstanding the foregoing provisions,

no indemnification shall be made in respect to any claim,

issue, or matter as to which such person shall have been adjudged

to be liable to the Corporation unless and only to the extent

that the Court of Chancery or the court in which such action or

suit was brought shall determine upon application that, despite

- 20 -

the adjudication of liability but in view of all the circumstances

of the case, such person is fairly and reasonably entitled to

indemnity for such expenses which the Court of Chancery or such

other court shall deem proper.

4. Advances. Expenses incurred by an officer or director

in defending a civil or criminal action, suit, or proceeding

may be paid by the Corporation in advance of the final disposition

of such action, suit, or proceeding upon receipt of an under-

taking by or on behalf of such director or officer to repay

such amount if it shall ultimately be determined that he is not

entitled to be indemnified by the Corporation as authorized in

this section.. Such expenses incurred by other employees and

agents maybe so paid upon such terms and conditions, if any,

as the Boatd of Trustees deems appropriate.

ARTICLE XI

PROCEDURE

The rules contained in the most recent edition of Robert's

Rules of Order shall provide the rules of procedure for the

Corporation where they are not inconsistent with the provisions

of the Certificate of Incorporation or these Bylaws.

ii

- 21 -

- ARTICLE XII

AMENDMENTS TO BYLAWS

These Bylaws may be altered, amended, or repealed and new

Bylaws may be adopted only by a majority vote of the Trustees

at any regular or special meeting, if at least fourteen (14)

days' written notice, including the text of the proposed changes,

is given of the intention to alter, amend, or repeal, or to

adopt new Bylaws at such meeting. Any amendmen.t adopted shall

be effective immediately upon adoption unless another date is

specified in the resolution adopting the amendment.

°A

Americans for Prosperity FoundationDirect Mail Consultants

GMA, Inc. d/b/a BMD901 North Washington StreetSuite 300Alexandria, VA 22314703-549-3500Contract: 2/2010 — 2/2011Services Provided: Counsel and advice, copy and design, coordination of printing,production, and mailshop servicesCompensation: $3,000 package fee or $.08 per piece, whichever is greater

Contract was cancelled in February, 2011. No longer using any professional fundraisersor consultants.

FUNDRAISING COUNSEL AGREEMENTBETWEEN GNh, INC. d/b/a/ BND

AND AMERICANS FOR PROSPERITY FOUNDATION

This Agreement to Provide Fundraising Counsel Services('Agreement') is dated and effective -as of February j, 2010, byand between G, Inc., d/b/a/ BMD, a Virginia corporation withprincipal offices located at 901 North Washington Street, Suite300, Alexandria VA 22314 ('BND') and americans for ProsperityFoundation (9'oundation 1 ), a nonprofit corporation having itsprincipal office at 2111 Wilson Blvd., Suite 350, Arlington VA22201,

RECITALS

A. BIVID is a direct response fundrai-sing consulting firmand wishes to provide fundraising consulting services toAmericans for Prosperity Foundation.

B. The Foundation's mission is to educate citizens abouteconomic .policy and mobilize those citizens as advocates in thepiublic policy process that champions the principles ofentrepreneurship and fiscal and regulatory restraint. The fundsraised pursuart to this Agreement will be used in support ofthis organization and its mission.

NOW, THEREFORE, for good and valuable consideration, thereceipt and adequacy of which are acknowledged, the partieshereto agree as follows:

1. Term of Agreement. This Agreement shall be effective for a

term of one year commencing as of the Agreement Date, unlessearlier terminated or unless renewed as provided below.

2. Commencement of Services. Notwithstanding anything to the.contrary herein, if any State regulatory agencies requiresubmission and/or approval of this Agreement, BMD shall notcoiynnence to provide Services for fundraising activities in suchState until all applicable regulatory requirements of such Statehave been satisfied.

I-...

3. Services. BMD will perform the following services for theFoundation in connection with its direct response fundraisingefforts (the "Services"):

a) Conceiving, writing and designing direct mailfundraising packages; and

b) Assistance to the Client in Overseeing the Productionand Vendor Management Services.

4. Termination and Renewal of Agreement.

(a) Termination for Cause. This Agreement may beterminated by either party upon ten (10) days prior writtennotice to the other in the event of a breach of this Agreementby such other party, provided such other party fails to curesuch breach within the ten (10) day notice period.

(b) Termination without Cause. This Agreement may beterminated by either party in its sole discretion without causeat any time upon giving thirty (30) days written notice to theother party. Any notice issued pursuant to this Section will beeffective one (1) day after being sent overnight delivery orthree (3) days if sent registered certified mail, andtermination will be effective thirty (30) days thereafter.

(c) First Ten-Day Cancellation Right. This Agreement maybe terminated by the Foundation without cost, penalty orliability at any time during the first ten (10) days after theFoundation signs this Agreement by giving written notice to BMD.

(d) Post-Termination Obligations. In the event that thisAgreement is terminated for any , reason, BMD shall receivepayment and reimbursement for all fees owing and costs andexpenses incurred or accrued pursuant to terms of this Agreementthrough the date of termination. The exercise by either partyof the option to terminate will in no way be construed as arelease or waiver of any rights or obligations accrued to date.

(e) Renewal. The term of this Agreement shall be renewedautomatically for successive additional periods of one yeareach, unless either party has, at least thirty (30) days priorto the expiration of the then-current term, exercised , its rightto terminate the Agreement.

5. Fees and Expenses.

a) Fees. In consideration of the Services provided

by BMD for the Foundation, BMD will receive a $3,000 package feeor fees of $08 per piece, whichever amount is greater, as longas the package continues to mail. This fee will include anychanges, updates, revisions, or versions required.

b) List Rental Commission. BMD, or its designated agent,shall receive an industry-standard commission of a percentage ofthe list rental charge for list rentals and/or exchanges madedirectly to or by the end list user.

c) Postage. Estimated postage for each approved mailingto be conducted by the Foundation is to be paid by theFoundation no less than ten (10) days in advance of thescheduled mailing date.

d) Expenses. The Foundations shall reimburse BMD for allother reasonable and necessary out-of-pocket expenses directlyattributable to the performance of the Services under thisAgreement. These will be billed at BMD's actual cost forreimbursement to the Foundation. Such expenses are anticipatedto include, but not be limited to, long distance phone calls,local and overnight delivery services, facsimiles, photocopies,and other similar items. Travel expenses will be billed to theFoundation at cost and BI1D will use its best efforts to plantravel in advance such that the lowest cost, pre-purchased, non-refundable tickets can be purchased. In the event that theFoundation cancels a meeting, the Foundation will cover the costof tickets. In addition, in the event that short-term planningrequires BMD to be present at the Foundation, the Foundationunderstands that pre-purchased, non-refundable tickets may bedifficult to obtain or may not be available. No expense greaterthan $200 will be incurred without the prior written approval ofthe Foundation.

e) Invoices; Interest. BMD will deliver periodic invoicesto the Foundation for amounts owing to BMD under this Agreement,and the Foundation shall pay all invoices in full not later thanthirty (30) days after receipt. Any balances which remainunpaid for more than thirty (30) days after the original invoiceshall be subject to an interest charge of 1.5% per month.

f) Control of Funds. The Foundation will at all timesmaintain and control all contributions received from fundraisingactivities covered by this Agreement. The Foundation will

deposit contributions promptly and at no time will BND exercise,handle or have custody or control over contributions receivedfrom the Foundations fundraising activities.

6. Fundraising Counsel Service Limitations; Approval, Volumeand Content of Solicitations.

(a) BMD will act and serve solely as a fundraising counselor consultant; and notwithstanding anything to the contrary inthis Agreement, BMD shall not perform, and shall have noobligation to perform, any services that would cause it to bedeemed a commercial or professional fundraiser under anyapplicable State law. Without limiting the generality of thepreceding sentence, BMD will not at any time solicit funds,assets or property for charitable purposes, receive or controlfunds, assets or property solicited for charitable purposes, oremploy, procure or engage (except as agent for Client) anycompensated person to solicit, receive or control funds, assetsor property for charitable purposes.

(b) The Foundation will, at all times, maintain controlover the schedule, volume and content of the direct mailsolicitations and programs handled by BrYID under this Agreement.All mailings produced by END on behalf of the Foundation will besubmitted to the Foundation for approval at least fifteen (15)business days prior to mailing.

7. Ownership and Use of Lists.

Client Lists. The parties mutually agree that lists ofnames and/or addresses owned by the Foundation(the "ClientLists") will not be given, traded, loaned, rented, sold or usedby BMD or any of its employees, consultants or agents withoutthe consent of the Foundation. BMD agrees to institutereasonable security measures in order to detect unauthorized useor abuse of Client Lists when BIVID's services are utilized.

8. Use and Ownership of Work Product.

(a) Work Product. Subject to the remainder of thisSection, all Work Product (as defined below) END produces for theFoundation in connection with this Agreement shall, to the extentthat BMD has proprietary rights therein, be the exclusiveproperty of the Foundation; and END hereby assigns and transfers

to the Foundation all copyright, trademark and other intellectualproperty rights in all Work Product to the extent that BMD hassuch rights and subject to any rights of third parties. Forpurposes of this Agreement, "Work Product" means the physicalmaster used in print production, the specific letter contentcontained therein, and the print production inventory of directmail packages produced by, and/or with the assistance of, BI'4D

under this Agreement.

(b) Infringement. BMD shall ensure that all copy andcontent that are, at BMD's initiative, incorporated within anyWork Product do not infringe upon the intellectual propertyrights of any third party. The Foundation shall ensure that allcopy or content that is supplied to BMD by the Foundation orthat is incorporated within any Work Product at the Foundation'sspecific direction does not infringe upon the intellectualproperty rights of any third party.

9. Partnerships, Joint Ventures and Agents. BMD shall be anindependent contractor of the Foundation, and nothing hereinshall be construed to place the parties in the relationship ofpartners, joint venturers or agents.

10. Legal and Regulatory Compliance.

(a) General. BMD and the Foundation each agree to complywith all local, state and federal laws, including thoseregarding the solicitation of charitable contributions that areapplicable to their obligations under this Agreement or anyrelated activities.

(b) State Filings. BMD will be responsible for all Stateregulatory reporting requirements applicable to professionalfundraising counsel for work performed by BMD pursuant to thisAgreement. BMD acknowledges and warrants that it is registeredwith all appropriate governmental agencies that regulatecharitable solicitation, for those States which this Agreementcovers, except for those agencies as to which BMD is in theordinary course of its business activity in the process ofupdating, renewing or correcting its registrations.

(c) The Foundation's Obligations. The Foundationacknowledges that certain State governmental regulatoryauthorities require BMD to provide information in the possessionof the Foundation and/or require Client's signature on theirforms and/or reports. The Foundation agrees to promptly furnish

such information and signatures to BMD. The Foundation willhave exclusive control over the content of all of itsfundraising solicitations and shall be exclusively responsiblefor ensuring that such solicitations comply with all applicablelegal requirements.

(d) The Foundation Representations. The Foundationrepresents, warrants and covenants that: (i) it is and willremain a non-profit organization for purposes of solicitationand registration, (ii) its required registrations, filings,licenses and permits are and will remain current, and (iii) itis and will remain registered with all applicable governmentalagencies that regulate charitable solicitations.

(e) Licenses and Permits. BMD and the Foundation shalleach be responsible for making, obtaining and maintaining itsown required registrations and filings with, and licenses andpermits from, all applicable federal, state and localauthorities. Upon request, each party shall provide the otherwith information and materials necessary for preparation ofregistrations and filings and applications for licenses,registration statements or permits.

11. Indemnification. In light of the Foundation's controlover contributions received from fundraising activities coveredby this Agreement and the content of its solicitations, theFoundation agrees that it will defend, indemnify and holdharmless BMD, its officers, directors, shareholders, employees,contractors and agents against any and all losses, liabilities,damages, claims, actions, suits, fines, penalties and costs(including reasonable attorneys' fees) (collectively, "Damages")arising from or related to: (1) fundraising, advocacy ormarketing activities, mailings and/or solicitations conducted orengaged in by the Foundation, (ii) any libel, slander or otherclaims arising from such activities, mailings and/orsolicitations or any publication by the Foundation, (iii) anybreach of this Agreement by the Foundation, and/or (iv) BMD'sperformance under this Agreement, except to the extent arisingfrom BMD's gross negligence or willful misconduct.

12. Confidentiality. Except as otherwise provided in thisAgreement, BMD agrees to maintain the confidentiality of theConfidential Information (as defined below) and agrees not todisclose any Confidential Information to any third party withoutthe prior written consent of the Foundation. For purposes ofthis Section, "Confidential Information" shall mean all

In

14

confidential or proprietary information relating to theFoundation and provided by it to BMD under the terms of thisAgreement. Notwithstanding the foregoing, "ConfidentialInformation" shall not include information: (i) in the publicdomain (other than as a result of a breach of this Section),(ii) in BMD T s possession prior to its receipt from theFoundation pursuant to this Agreement, (iii) independentlydeveloped by BMD or known through a party other than theFoundation, which party has no duty of confidentiality to theClient, (iv) which BMD is legally required to disclose duringthe course of any legal, administrative or regulatoryproceeding, or (v) concerning, the tax treatment and/or taxstructure of this Agreement, including opinions or other taxanalysis relating to such tax treatment and/or tax structure.

13. Warranties. BMD makes no express or implied warranties orguarantees of the number or amount of contributions or otheroutcome that will be achieved as a result of the direct mailprograms implemented pursuant to this Agreement.

14. Limitation of Liability. Neither party shall be liable tothe other for any indirect, special, consequential, incidentalor punitive damages or for any lost revenues or profits, whetherforeseeable or unforeseeable, by reason of any act, omission,matter or event relating to this agreement or arising out of anydefault or breach thereof, misrepresentation, negligence, strictliability in tort or otherwise. In no event will BMD have anyliability for any loss or damage caused by any act or omissionof any third party vendor engaged to provide production or otherservices in connection with any fundraising activities coveredby this agreement. BMD's liability in the event of any error ormistake on its part shall be limited to the correction oferrors, replacement of material or reconstruction of data. Inno event will the liability of BMD under this agreement for anybreach or default by BMD under this agreement exceed the actual,out-of-pocket cost of the mailing to which such breach ordefault pertains. For purposes of this Section, "actual out-of-pocket costs" are defined to include printing costs, mailshopcosts, list rental costs, cost of merge-purge services, postage,production fees, direct consulting fees, copywriting fees, artfees, fees for production of computer tapes, delivery fees andany other direct costs of the particular mailing to which thebreach or default pertains.

15. Governing Law. This Agreement shall be governed by andconstrued in accordance with the laws of the Commonwealth ofVirginia.

16. Notices. Any notice required under this Agreement must bein writing and will be deemed to have been given by either partyto the other party upon the date of receipt, if hand delivered,or three (3) days after deposit in the U.S. mail, if mailed tothe other party by registered or certified mail, properlyaddressed, postage prepaid, return receipt requested, or one (1)business day after deposit with a national overnight courier fornext business day delivery. The mailing addresses for noticesto the parties are as follows:

Gregory A tunford, PresidentGNA, Inc. d/b/a BND901 North Washington StreetSuite 300Alexandria VA 22314

John Flynn, General Counsel,Americans for ProsperityFoundation2111 Wilson Blvd.Suite 350Arlington VA 22201

17. Waiver of Officers, Directors Liability. Neither partyshall have recourse or right of action against any shareholder,officer or director, in his or her individual capacity as such,past, present or future, of the other party or of any successorthereto, whether by virtue of any statute or rule of law orotherwise, all such liability being, by the acceptance hereofand as part of the consideration of the execution hereof,expressly waived and released.

18. Agents. To the extent reasonably necessary to enable BMDto perform its duties hereunder, BMD shall be authorized toengage the services of any agents, contractors or assistantswhich BMD may deem proper. Notwithstanding anything to thecontrary contained in this Agreement, Bt4D shall be permitted to'disclose confidential information regarding the Foundation tothose agents, contractors or assistants engaged by BMD to theextent such persons have a bona fide need to know suchinformation.

19. Attorneys' Fees. In any action, arbitration or otherproceeding involving the enforcement or interpretation of thisAgreement, the prevailing party shall be entitled to recoverfrom the other party its costs incurred therein, includingreasonable attorneys' fees.

20. Severability. Any provision of this Agreement which isfound to be prohibited or unenforceable in any jurisdictionshall, as to such jurisdiction, be deemed to be modified to theextent necessary to render such provision valid and enforceable;if such provision may not be so saved, it shall be severed, andthe remainder of this Agreement shall remain in full force andeffect. Modification or severance of a provision in anyjurisdiction shall not serve to modify, invalidate or renderunenforceable such provision in any other jurisdiction.

21. Whole Agreerttent. This Agreement, including any addendumor other documents referred to herein, constitutes. the entireunderstanding and agreement of the parties with respect to its.subject matter; and any and all prior agreements,understandings, representations, warranties, undertakings orpromises with respect to the subject matter of this Agreementare hereby terminated and canceled in their entirety and are ofno further force or effect. This Agreement may not be amendedexcept by a written agreemenxt signed by both parties.

IN WITNESS WHEREOF the parties have subscribed this agreement onthe date indicated below.

GMA, Inc. d/bfa/ BND

ByName. _____________Title: prc.r4Dated: c(a-ft

Americans. for Prosperity-

Foi

By:N arcTitDat

By: I 4itName:Title.:Dated:

Note: Under State regulatory requirements, this Agreement mustbe signed by two individuals authorized to act on behalf ofAmericans for Prosperity Foundation.