Providence Group, L.P.

                                                             SUMMARY OF PRINCIPAL TERMS

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Set forth below is a summary of certain significant provisions of the Limited Partnership Agreement and other related agreements governing the Partnership.  The following summary does not purport to be complete and is subject to the detailed provisions of the Limited Partnership Agreement, the Subscription Agreement and the Management Agreement.  These documents should be read in their entirety by investors and are available upon request from the General Partner, who is also available to respond to investors' inquiries and requests for further information concerning the Partnership.

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Partnership:

               

Providence Group, L.P., a Delaware limited partnership (the “Partnership”).

 

General Partner:

         

Providence Group, GP LLC a Delaware limited liability company (the "General Partner"). The General Partner shall have full control over the business and affairs of the Partnership, except that the Partnership shall make no investment in a Portfolio Company without a “yes” vote of a Majority in Interest of the Limited Partners.

  

Limited Partners:

       

Purchasers of Interests are referred to collectively herein as the “Limited Partners”, and together with the General Partner as the “Partners”.

 

Manager:

                    

Providence Management, Inc, a Delaware corporation (the “Manager”). Pursuant to a Management Agreement, the Manager will manage the affairs of the Partnership, however, the General Partner shall remain responsible for the management and control of the Partnership ’s affairs.

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The Offering:

              

The Partnership Offering is $5,000,000 of limited partnership interests (the "Interests"). However, the General Partner may increase or decrease the size of the offering. ​

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Minimum Limited

Partner Commitment:  

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The minimum subscription by a Limited Partner will be $50,000, subject to the discretion of the General Partner, which also has discretion to reject the offer of a subscription for any reason.

 

Term:

                            

The Partnership's term will continue until the seventh anniversary of the Final Closing, unless terminated sooner upon the happening of certain events as set forth in the Partnership Agreement, subject to extension of up to two additional one-year periods by the General Partner in the discretion of the General Partner.

 

Management Fees:

      

The Manager will receive an annual management fee (the "Management Fee") of up to $250,000 payable in monthly installments. Management fees will be offset by any management fees, directors fees, advisory fees, consulting fees, monitoring fees, transaction fees, investment banking fees and other such fees charged to any Portfolio Company by the Manager or its Affiliates for that same period. 

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Expenses:

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Each Partner will be responsible for its pro rata share of the Organizational Expenses of the Partnership up to a limit not to exceed $250,000.

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Distributions:

          

The General Partner will distribute proceeds realized from dispositions of investments, plus any dividends or interest income received at least annually; however, the General Partner may retain amounts it considers prudent reserves to meet future expenses and liabilities of the Partnership. Distributions will be made in cash and in U.S. dollars or in Marketable Securities at the sole discretion of the General Partner (distributions of other property may be made only with the consent of a majority in interest of the Limited Partners). Distributions attributable to any portfolio investment will be initially apportioned among the Partners in proportion to their respective percentage interests relating to such investment. The amount apportioned to the Limited Partners will then be immediately reapportioned as between the Limited Partners and the General Partner as follows:

 

    (i) Return of Contributed Capital. 66.67% to the Limited Partners in proportion to their contributed capital until they have received                  distributions equal to their Capital Contributions and the pro rata expenses of the Partnership with respect to all Realized                        Investments, together with a sum equal to 12%;

 

   (iii) Carried Interest. thereafter, 33.33% to the Limited Partners, pro rata. 

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Co-Investment by

Limited Partners:        

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When the General Partner deems it appropriate and consistent with the interests of the Partnership, it may provide Limited Partners with additional co-investment opportunities. Such opportunities may take the form of senior debt, subordinated debt, equity or equity-related investments.

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Other Partnerships:

 

Neither the General Partner, the Principals, nor any Affiliate of any Principal will organize or be associated with another investment Partnership with objectives similar to those of the Partnership without the prior consent of the Limited Partners representing a majority of the aggregate Commitments until the earlier of the termination of the Investment Period or the date on which at least 66.67% of the aggregate capital commitments has been drawn down or is committed to Portfolio Companies or is otherwise unavailable therefor.

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Indemnification:    

 

The Partnership will indemnify, to the maximum extent permitted by law, the General Partner, the Manager, each of their respective directors, officers, partners, employees, affiliates and assigns and the members of the Investment Committee and the Executive Advisory Committee, against liabilities, claims and related expenses including attorneys' fees, incurred by reason of any action performed or omitted in connection with the activities of the Partnership or in dealing with third parties on behalf of the Partnership if such action or decision not to act was taken in good faith, and provided that such action or decision not to act does not constitute gross negligence,    intentional misconduct, a knowing violation of law or an intentional or material breach of the Limited Partnership Agreement or the Management Agreement.

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Risk Factors:         

 

An investment in the Partnership involves significant risk and should be considered only by sophisticated investors able to meet drawdown obligations and assume the risks of loss and illiquidity inherent with an investment in the Partnership. See "Risk Factors."

 

Financial Reporting:

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The General Partner will provide the Limited Partners with annual financial statements of the Partnership within 90 days after the end of the fiscal year of the Partnership and quarterly financial statements within 60 days after the end of each fiscal quarter (except the last). Financial statements will be prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP).  The fiscal year end of the Partnership will be December 31.

 

Annual Meeting:      

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The Partnership will hold an annual meeting of the Partners.

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New Acquisitions:

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Any Portfolio Company acquired by the Partnership will be after the vote of a Majority in Interest of the Limited Partners.

 

Executive Advisory Committee:

 

The General Partner has established an Executive Advisory Committee which will include representatives from the Limited Partners.

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