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The introductory statements in the Pathways to Economic Advancement, Pay for Success Contract. These statements, in whereas form, set out the parties' intentions; what the contract is for, who the parties are and so on.

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WHEREAS, Chapter 143 of the Acts of 2012 of the Commonwealth established Section 35VV of Chapter 10 of the Massachusetts General Laws (the “Enabling Act”) which authorizes the Secretary of EOAF (the “Secretary”) to enter into Pay For Success contracts (“Authorized PFS Agreements”), subject to particular findings being made (the “Authorizing Criteria”), and further authorizes the Secretary to provide that the Commonwealth's payments under such Authorized PFS Agreements shall constitute a general obligation of the Commonwealth for which the full faith and credit of the Commonwealth are pledged for the benefit of providers of contracted government services (“Authorized Contractors”); and

WHEREAS, the Enabling Act also created a “Social Innovation Financing Trust Fund” (the “PFS Fund”) which is held on the books of the Commonwealth and administered by the Secretary to make payments to Authorized Contractors under Authorized PFS Agreements; and

WHEREAS, the Enabling Act also requires certain reporting by the Secretary pursuant to Section 35VV(d) thereof (the “Required Reporting”); and

WHEREAS, the Commonwealth has issued a request for proposals for an Authorized PFS Agreement to address the needs of residents in certain target areas in the Commonwealth for additional job training, English language training and education in order to obtain employment, higher wages and/or higher educational achievements; and

WHEREAS, the Parties wish to enter into a contract for the Massachusetts Pathways to Economic Advancement Project (“PFS Project”), in which the highest priority and goal is to transition people in the target areas who are on Adult Basic Education (“ABE”) and English for Speakers of Other Languages (“ESOL”) waitlists to employment, higher wage jobs and/or higher education, as more fully described herein; and

WHEREAS, JVS has a long history of providing targeted job training, English as a second language classes, and education to new immigrants and others, with proven records of success, and will serve as the Authorized Contractor under this PFS Contract; and

WHEREAS, EOAF is responsible for implementing fiscal and administrative policies that promote the financial stability, efficiency and effectiveness of state government and for EXECUTION COPY 6 developing and implementing cost-effective public policy initiatives to benefit the residents of the Commonwealth, including Authorized PFS Agreements; and

WHEREAS, EOLWD is responsible for providing leadership, professional assistance and financial resources to promote labor and workforce development and economic opportunity in the Commonwealth; and

WHEREAS, EOE is committed to advancing actions and initiatives that will improve achievement for all students and close persistent achievement gaps, and to creating a 21st century public education system that prepares students for higher education, work and life in a world economy and global society; and

WHEREAS, SFI will act as the program intermediary for this PFS Contract, raise funds in support of the JVS Services and other services to be delivered in accordance with this PFS Contract, and monitor JVS Services delivered under this PFS Contract, all as set forth in this PFS Contract; and

WHEREAS, SFMA was formed for the purposes set forth in its organizational documentation, and will act as the fiscal intermediary for this PFS Contract, all as set forth in this PFS Contract; and

WHEREAS, it is anticipated that Authorized PFS Agreements will create incentives for improved project performance at a reduced cost to the Commonwealth, allow for more rapid learning about which social programs work and which do not, and accelerate the adoption of new, more effective solutions to social problems; and

WHEREAS, Authorized PFS Agreements are intended to provide a mechanism to attract financial support from the private and non-profit sectors to innovative social programs, thereby allowing Authorized Contractors to create the operational set of services needed to create longterm, preventative social service programs and resulting in better social outcomes for the targeted population and cost savings in the amount of public expenditures tied to the targeted population; and

WHEREAS, payments by the Commonwealth pursuant to Authorized PFS Agreements will only be made based on achieving specific, measurable goals satisfying the Authorizing Criteria; and

WHEREAS, initial support for the operating costs associated with JVS Services will come from funds provided by investors, lenders or grantors (collectively, the “Funding Partners”) and paid to SFMA; and

WHEREAS, to the extent JVS is successful in meeting the Final Outcomes, the Commonwealth will make Success Payments to SFMA, as the fiscal intermediary, to be applied to repay obligations to the Funding Partners, and, if applicable, to support JVS as it continues to provide services to the target population; EXECUTION COPY 7

NOW, THEREFORE, in consideration of the above premises, and the representations, warranties, covenants and other agreements set forth herein, the Parties intending to be legally bound, hereby agree as follows: