Document:

EX-4.10.1 First Amendment to Subordination and Int

 

Exhibit 4.10.1

FIRST AMENDMENT TO SUBORDINATION AND INTERCREDITOR AGREEMENT

     This FIRST AMENDMENT TO SUBORDINATION AND INTERCREDITOR AGREEMENT (this “Amendment”)
is dated as of June 29, 2007, and is entered into among LAMINAR DIRECT CAPITAL, L.P., a Delaware
limited partnership (“Laminar”, and, together with any other Person that becomes a party to
the Subordination Agreement (as defined below) as a “Subordinated Creditor” pursuant to a
Subordinated Creditor Supplement (as defined in the Subordination Agreement), each, a
“Subordinated Creditor”, and collectively, “Subordinated Creditors”), SECURUS
TECHNOLOGIES, INC., a Delaware corporation (“Company”), the Subsidiaries of Company party
hereto (collectively, “Subsidiary Guarantors” and, together with Company, collectively,
“Debtors”) and ING CAPITAL LLC, as Agent for all Senior Creditors (as defined in the
Subordination Agreement) party to the Senior Credit Agreement (as defined below) (“Agent”).

RECITALS:

     WHEREAS, Debtors, Agent and the other Senior Creditors have entered into a Credit Agreement
dated as of September 9, 2004 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the “Senior Credit Agreement”);

     WHEREAS, as an inducement and one of the conditions precedent to the agreement of Agent and
the other Senior Creditors to consummate the transactions contemplated by the Senior Credit
Agreement, Agent and the other Senior Creditors required the Debtors and the Subordinated Creditors
to execute and deliver that certain Subordination and Intercreditor Agreement dated as of September
9, 2004 (as amended from time to time, the “Subordination Agreement”; capitalized terms
used herein and not otherwise defined shall have the meaning ascribed to such terms in the
Subordination Agreement);

     WHEREAS, Debtors, Agent and the other Senior Creditors have agreed to amend the Senior Credit
Agreement pursuant to that Consent and Third Amendment to Credit Agreement dated as of even date
herewith (the “Third Amendment”); and

     WHEREAS, in connection with the execution and delivery of the Third Amendment, Debtors,
Subordinated Creditors, Debtors, and Agent, on behalf of the Senior Creditors, have agreed to amend
the Subordination Agreement on the terms and conditions set forth herein;

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

     SECTION 1. AMENDMENTS TO THE SUBORDINATION AGREEMENT

     1.1. Section 2.3 of the Subordination Agreement, Subordinated Debt Payment
Restrictions, is hereby modified and amended by deleting subsection (a) thereof in its entirety
and by inserting the following in lieu thereof:

 

 

     (a) Notwithstanding the terms of the Subordinated Debt Documents,
each Debtor hereby agrees that it may not make, and each Subordinated Creditor
hereby agrees that it will not accept, any Distribution with respect to the
Subordinated Debt until all Senior Debt is indefeasibly paid in full in cash to the
satisfaction of Senior Creditors and all commitments to lend under the senior Debt
Documents shall have been terminated; provided, however, that
Company may make, and each Subordinated Creditor may accept, (i) PIK Subordinated
Debt Payments, (ii) so long as no Senior Default exists or would be caused thereby
and Distributable Cash Flow is available therefor, cash payments of interest on the
Subordinated Debt due and payable on a non-accelerated basis in accordance with the
terms of the Subordinated Debt Documents, and (iii) to the extent any Holders (as
defined in the Indenture, as defined in the Senior Credit Agreement) have not
elected to have their Securities (as defined in the Indenture, as defined in the
Senior Credit Agreement) redeemed pursuant to an Excess Cashflow Offer (as defined
in the Indenture, as defined in the Senior Credit Agreement) as permitted by Section
8.14(b)(iii) or (iv) of the Senior Credit Agreement, so long as no Senior Default
exists, cash payments on accrued interest in accordance with the Subordinated Note
Documents as they exist on the date hereof or as amended as permitted by this
Agreement; provided, however in no event shall the amount of
Distributions made pursuant to this Section 2.3(a)(iii) in any calendar year,
together with the amount of any repurchase of Securities (as defined in the
Indenture, as defined in the Senior Credit Agreement) made with respect to such
calendar year under Section 8.14(b)(iii) and 8.14 (b)(iv) of the Senior Credit
Agreement, exceed the Excess Cash Flow Amount (as defined in the Indenture, as
defined in the Senior Credit Agreement) for such calendar year.

     SECTION 2. MISCELLANEOUS

     2.1. NO OTHER AMENDMENTS. Except for the amendments set forth above, the text of the
Subordination Agreement shall remain unchanged and in full force and effect, and Agent, on behalf
of the Senior Creditors, the Subordinated Creditors and Debtors hereby ratify and confirm their
obligations thereunder.

     2.2. ACKNOWLEDGMENT OF VALIDITY AND ENFORCEABILITY OF FINANCING DOCUMENTS. To the
extent of any inconsistencies between the terms and provisions of this Amendment and the terms and
provisions of the Subordination Agreement, this Amendment shall govern. In all other respects, the
Subordination Agreement shall remain in full force and effect.

     2.3. CONDITIONS PRECEDENT. This Amendment shall become effective and be deemed
effective as of the date hereof, upon the occurrence of each of the following:

          (a) Agent shall have received counterparts of this Amendment, duly executed and delivered by
Agent, Subordinated Creditors and the Debtors; and

2

 

          (b) Agent shall have received counterparts of the amendment to the Third Amendment, duly
executed by the parties thereto, and all conditions precedent to the effectiveness of such
amendment shall have been satisfied.

     2.4. SOLE BENEFIT OF PARTIES. This Amendment is solely for the benefit of the parties
hereto and their respective successors and assigns, and no other person shall have any right,
benefit or interest under or because of the existence of this Amendment.

     2.5. SECTION TITLES. The section titles contained in this Amendment are included for
the sake of convenience only, shall be without substantive meaning or content of any kind
whatsoever, and are not a part of the agreement between the parties.

     2.6. REFERENCE TO AND EFFECT ON THE SUBORDINATION AGREEMENT. On and after the date
hereof, each reference in the Subordination Agreement to “this Agreement”, “hereunder”, “hereof” or
words of like import referring to the Subordination Agreement shall mean and be a reference to the
Subordination Agreement as amended hereby.

     2.7. SEVERABILITY. The provisions of this Amendment are independent of and separable
from each other, and no such provision shall be affected or rendered invalid or unenforceable by
virtue of the fact that for any reason any other such provision may be invalid or unenforceable in
whole or in part. If any provision of this Amendment is prohibited or unenforceable in any
jurisdiction, such provision shall be ineffective in such jurisdiction only to the extent of such
provision or unenforceability, and such prohibition or unenforceability shall not invalidate the
balance of such provision to the extent it is not prohibited or unenforceable nor render prohibited
or unenforceable such provision in any other jurisdiction.

     2.8. ENTIRE AGREEMENT. The Subordination Agreement, as amended by this Amendment,
constitutes the entire agreement and understanding between the parties hereto with respect to the
transactions contemplated hereby and supersedes all prior negotiations, understandings and
agreements between such parties with respect to such transaction.

     2.9. APPLICABLE LAW. THIS AMENDMENT AND THE TRANSACTIONS EVIDENCED HEREBY SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK AND ALL
APPLICABLE FEDERAL LAWS OF THE UNITED STATES OF AMERICA.

     2.10. COUNTERPARTS. This Amendment may be executed by one or more of the parties
hereto in any number of separate counterparts, each of which shall be deemed an original and all of
which, taken together, shall be deemed to constitute one and the same instrument. Delivery of an
executed counterpart of this Amendment by facsimile transmission or by electronic mail in PDF form
shall be as effective as delivery of a manually executed counterpart thereof.

     2.11. LOAN DOCUMENT. This Amendment shall be deemed a Loan Document for all purposes.

[Remainder of page intentionally left blank.]

3

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the
date first set forth above, by their respective duly authorized officers.

	 	 	 	 	 
	 	SUBORDINATED CREDITORS:

LAMINAR DIRECT CAPITAL, L.P., a Delaware limited partnership

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

First Amendment to Subordination and Intercreditor Agreement

4

 

	 	 	 	 	 
	 	DEBTORS:

SECURUS TECHNOLOGIES, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	T-NETIX, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	TELEQUIP LABS, INC., a Nevada corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	T-NETIX TELECOMMUNICATIONS SERVICES,
INC., a Texas corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	SPEAKEZ, INC., a Colorado corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	T-NETIX MONITORING CORPORATION,

a Colorado corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

First Amendment to Subordination and Intercreditor Agreement

5

 

	 	 	 	 	 
	 	EVERCOM HOLDINGS, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	EVERCOM, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	EVERCOM SYSTEMS, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	FORTUNELINX, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	EVERCONNECT, INC., a Delaware corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	SYSCON JUSTICE SYSTEMS, INC., a California

corporation

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	MODELING SOLUTIONS LLC, a Nevada
limited liability company

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

First Amendment to Subordination and Intercreditor Agreement

6

 

	 	 	 	 	 
	 	MODELING SOLUTIONS, LLC, a Wisconsin
limited liability company

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

First Amendment to Subordination and Intercreditor Agreement

7

 

	 	 	 	 	 
	 	AGENT:

ING CAPITAL LLC, a

Delaware corporation, as Agent

 	 
	 	By:  	 	 
	 	 	Its: 	 
	 	 	 	 
	 

First Amendment to Subordination and Intercreditor Agreement

8EX-4.13 Form of 11% Senior Secured Notes due 2011

 

Exhibit 4.13

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

     TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

     UNTIL 40 DAYS AFTER THE LATER OF COMMENCEMENT OR COMPLETION OF THE OFFERING, AN OFFER OR SALE
OF SECURITIES WITHIN THE UNITED STATES BY A DEALER (AS DEFINED IN THE SECURITIES ACT) MAY VIOLATE
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF SUCH OFFER OR SALE IS MADE OTHERWISE THAN IN
ACCORDANCE WITH RULE 144A THEREUNDER.

     THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND MAY NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY
U.S. PERSON EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS GIVEN
TO THEM IN REGULATION S UNDER THE SECURITIES ACT.

     EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S
GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN THE PERMANENT REGULATION S GLOBAL
SECURITY OR ANY OTHER SECURITY REPRESENTING AN INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH
DO NOT CONTAIN A LEGEND CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY
DISTRIBUTION COMPLIANCE PERIOD” (WITHIN THE MEANING OF RULE 903(b)(2) OF REGULATION S UNDER THE
SECURITIES ACT) AND THEN ONLY UPON

 

 

CERTIFICATION IN FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS
ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION
THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING SUCH 40-DAY DISTRIBUTION
COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED (I) TO THE COMPANY, (II) OUTSIDE THE UNITED STATES IN A
TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (III) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (III)
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. HOLDERS OF
INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY
OF THE RESALE RESTRICTIONS REFERRED TO ABOVE, IF THEN APPLICABLE.

     AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD BENEFICIAL INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR INTERESTS IN A RULE 144A GLOBAL
SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN
COMPLIANCE WITH RULE 144A AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST DELIVERS
TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT
THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY
BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (B) TO A PERSON WHO
IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, AND (C) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.

     AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR INTERESTS IN AN IAI GLOBAL SECURITY
ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH
AN EXEMPTION UNDER THE SECURITIES ACT AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY
FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO
THE EFFECT THAT THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO AN “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(A)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT THAT, PRIOR
TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING

2

 

TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF
SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES LESS THAN $250,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.

     BENEFICIAL INTERESTS IN A RULE 144A GLOBAL SECURITY OR AN IAI GLOBAL SECURITY MAY BE
TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S GLOBAL
SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY
IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS
CERTIFICATE) TO THE EFFECT THAT SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF
REGULATION S OR RULE 144 (IF AVAILABLE).

     THIS NOTE HAS BEEN ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) FOR PURPOSES OF SECTIONS 1271
ET SEQ. OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. THE ISSUE DATE OF THIS NOTE IS JUNE 29,
2007. FOR INFORMATION REGARDING THE ISSUE PRICE, AMOUNT OF OID PER $1,000 OF PRINCIPAL AMOUNT, THE
COMPARABLE YIELD TO MATURITY AND PROJECTED PAYMENT SCHEDULE FOR PURPOSES OF THE OID RULES, PLEASE
CONTACT THE ISSUER AT SECURUS TECHNOLOGIES, INC., C/O H.I.G. CAPITAL, LLC, 1001 BRICKELL BAY DRIVE,
27TH FLOOR, MIAMI, FLORIDA 33131, TELEPHONE: (305) 379-2322, ATTENTION: ROB WOLFSON.

3

 

SECURUS TECHNOLOGIES, INC.

Second-Priority Senior Secured Notes Due 2011

CUSIP No.

ISIN No.

			
	No.
	 	$_________

     Securus Technologies, Inc., a Delaware corporation, promises to pay to CEDE & CO., or
registered assigns, the principal sum of ___on September 1, 2011.

     Interest Payment Dates: March 1 and September 1.

     Record Dates: February 15 and August 15.

     Additional provisions of this Security are set forth on the other side of this Security.

Dated: June 29, 2007

SIGNATURE PAGES FOLLOW

4

 

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

Dated: June 29, 2007

	 	 	 	 	 
	 	SECURUS TECHNOLOGIES, INC.,

 	 
	 	by  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	 	 
	 	by  	
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

TRUSTEE’S CERTIFICATE OF

AUTHENTICATION

THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Trustee, certifies that this is one of the Securities referred to in the Indenture.

	 	 	 	 	 
	 	 	 
	 	by  	
 	 
	 	 	Authorized Signatory 	 
	 	 	 	 

5

 

	 	 	 	 	 

11% Second-Priority Senior Secured Note Due 2011

1. Interest

     Securus Technologies, Inc., a Delaware corporation (such corporation, and its successors and
assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises
to pay interest on the principal amount of this Security at the rate per annum shown above;
provided, however, that if a Registration Default (as defined in the Registration
Rights Agreement) occurs, additional interest shall accrue on this Security at a rate of 0.50% per
annum (increasing by an additional 0.50% per annum after each consecutive 90-day period that occurs
after the date on which such Registration default occurs up to a maximum additional interest rate
of 2.00%) from and including the date on which any such Registration Default shall occur to but
excluding the date on which all Registration Defaults have been cured. The Company shall pay
interest semiannually on March 1 and September 1 of each year, commencing September 1, 2007.
Interest on the Securities shall accrue from the most recent date to which interest has been paid
or, if no interest has been paid, from June 29, 2007. Interest shall be computed on the basis of a
360-day year of twelve 30-day months. The Company shall pay interest on overdue principal at the
rate borne by this Security plus 1.0% per annum, and it shall pay interest on overdue installments
of interest at the same rate to the extent lawful.

2. Method of Payment

     The Company shall pay interest on the Securities (except defaulted interest) to the Persons
who are registered holders of Securities at the close of business on the February 15 or August 15
next preceding the interest payment date even 0if Securities are canceled after the record date and
on or before the interest payment date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company shall pay principal and interest in money of the United
States that at the time of payment is legal tender for payment of public and private debts.
Payments in respect of the Securities represented by a Global Security (including principal,
premium and interest) shall be made by wire transfer of immediately available funds to the accounts
specified by the Depository. The Company shall make all payments in respect of a certificated
Security (including principal, premium and interest) by mailing a check to the registered address
of each Holder thereof; provided, however, that payments on a certificated Security
shall be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the
United States if such Holder elects payment by wire transfer by giving written notice to the
Trustee or the Paying Agent to such effect designating such account no later than 30 days
immediately preceding the relevant due date for payment (or such other date as the Trustee may
accept in its discretion).

3. Paying Agent and Registrar

     Initially, The Bank of New York Trust Company, N.A., a national banking association (the
“Trustee”), shall act as Paying Agent and Registrar. The Company may appoint and change any Paying
Agent, Registrar or co-registrar without notice. The
Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying
Agent, Registrar or co-registrar.

6

 

4. Indenture

     The Company issued the Securities under an Indenture dated as of September 9, 2004 as amended
by that Supplemental Indenture dated June 29, 2007 (the “Indenture”), among the Company, the
Subsidiary Guarantors and the Trustee. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15
U.S.C. §§ 77aaa-77bbbb) (the “Act”). Terms defined in the Indenture and not defined herein
have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms,
and Securityholders are referred to the Indenture and the Act for a statement of those terms.

     The Securities are general secured obligations of the Company. The Company shall be entitled,
subject to its compliance with Section 4.03 of the Indenture, to issue Additional Securities
pursuant to Section 2.13 of the Indenture. The Initial Securities issued on September 9, 2004, the
2007 Additional Securities issued on June 29, 2007, any Additional Securities and all Exchange
Securities or Private Exchange Securities issued in exchange therefor shall be treated as a single
class for all purposes under the Indenture even though the 2007 Additional Securities will trade
under a separate CUSIP number and receive separate tax treatment relating to the recognition of
original issue discount. The Indenture contains covenants that limit the ability of the Company
and its subsidiaries to incur additional indebtedness; pay dividends or distributions on, or redeem
or repurchase capital stock; make investments; issue or sell capital stock of subsidiaries; engage
in transactions with affiliates; create liens on assets; transfer or sell assets; guarantee
indebtedness; restrict dividends or other payments of subsidiaries; consolidate, merge or transfer
all or substantially all of its assets and the assets of its subsidiaries; and engage in
sale/leaseback transactions. These covenants are subject to important exceptions and
qualifications.

5. Optional Redemption

     Except as set forth below, the Company shall not be entitled to redeem the Securities.

     On and after September 1, 2008, the Company shall be entitled at its option to redeem all or a
portion of the Securities upon not less than 30 nor more than 60 days’ notice, at the redemption
prices (expressed in percentages of principal amount on the redemption date), plus accrued interest
to the redemption date (subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), if redeemed during the 12-month period
commencing on September 1 of the years set forth below:

7

 

	 	 	 	 	 
	 	 	Redemption	 
	Period	 	Price	 
	2008
	 	 	105.500	%
	2009
	 	 	102.750	%
	2010
	 	 	100.000	%

     In addition, prior to September 1, 2007, the Company shall be entitled at its option on one or
more occasions to redeem Securities (which includes the 2007 Additional Securities and Additional
Securities, if any) in an aggregate principal amount not to exceed 35% of the aggregate principal
amount of the Securities (which includes the 2007 Additional Securities and Additional Securities,
if any) originally issued at a redemption price (expressed as a percentage of principal amount) of
111.000%, plus accrued and unpaid interest to the redemption date, with the net cash proceeds from
one or more Equity Offerings; provided, however, that (1) at least 65% of such
aggregate principal amount of Securities (which includes the 2007 Additional Securities and
Additional Securities, if any) remains outstanding immediately after the occurrence of each such
redemption (other than Securities held, directly or indirectly, by the Company or its Affiliates);
and (2) each such redemption occurs within 90 days after the date of the related Equity Offering.

     Prior to September 1, 2008, the Company shall be entitled at its option to redeem all, but not
less than all, of the Securities at a redemption price equal to 100% of the principal amount of the
Securities plus the Applicable Premium as of, and accrued and unpaid interest to, the redemption
date (subject to the right of Holders on the relevant record date to receive interest due on the
relevant interest payment date). The Company shall cause notice of such redemption to be mailed by
first-class mail to each Holder’s registered address, not less than 30 nor more than 60 days prior
to the redemption date.

6. Notice of Redemption

     Notice of redemption shall be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder of Securities to be redeemed at his registered address. Securities
in denominations larger than $1,000 principal amount may be redeemed in part but only in whole
multiples of $1,000. If money sufficient to pay the redemption price of and accrued interest on
all Securities (or portions thereof) to be redeemed on the redemption date is deposited with the
Paying Agent on or before the redemption date and certain other conditions are satisfied, on and
after such date interest ceases to accrue on such Securities (or such portions thereof) called for
redemption.

7. Put Provisions

     Upon a Change of Control, any Holder of Securities shall have the right to cause the Company
to purchase all or any part of the Securities of such Holder at a repurchase price equal to 101% of
the principal amount of the Securities to be repurchased plus accrued interest to the date of
repurchase (subject to the right of holders of record on the
relevant record date to receive interest due on the related interest payment date) as provided
in, and subject to the terms of, the Indenture.

8

 

8. Guaranty

     The payment by the Company of the principal of, and premium and interest on, the Securities is
fully and unconditionally guaranteed on a joint and several senior basis by each of the Subsidiary
Guarantors to the extent set forth in the Indenture.

9. Security

     The Securities shall be secured by the Collateral on the terms and subject to the conditions
set forth in the Indenture and the Security Documents, such security interest to be second in
priority to security interests granted for the benefit of holders of First-Priority Lien
Obligations. The Trustee and the Collateral Agent, as the case may be, hold the Collateral in
trust for the benefit of the Trustee and the Holders, in each case pursuant to the Security
Documents and the Intercreditor Agreement. Each Holder, by accepting this Security, consents and
agrees to the terms of the Security Documents (including the provisions providing for the
foreclosure and release of Collateral) and the Intercreditor Agreement as the same may be in effect
or may be amended from time to time in accordance with their terms and the Indenture and authorizes
and directs the Trustee and the Collateral Agent to enter into the Security Documents and the
Intercreditor Agreement, and to perform their respective obligations and exercise their respective
rights thereunder in accordance therewith.

10. Denominations; Transfer; Exchange

     The Securities are in registered form without coupons in denominations of $1,000 principal
amount and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance
with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not register the transfer of or exchange any Securities selected
for redemption (except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities for a period of 15 days before a selection of
Securities to be redeemed or 15 days before an interest payment date.

11. Persons Deemed Owners

     The registered Holder of this Security may be treated as the owner of it for all purposes.

12. Unclaimed Money

     If money for the payment of principal or interest remains unclaimed for two years, the Trustee
or Paying Agent shall pay the money back to the Company at its request unless an abandoned property
law designates another Person. After any such payment,
Holders entitled to the money must look only to the Company and not to the Trustee for
payment.

9

 

13. Discharge and Defeasance

     Subject to certain conditions, the Company at any time shall be entitled to terminate some or
all of its obligations under the Securities and the Indenture if the Company deposits with the
Trustee money or U.S. Government Obligations for the payment of principal and interest on the
Securities to redemption or maturity, as the case may be.

14. Amendment, Waiver

     Subject to certain exceptions set forth in the Indenture, (a) the Indenture and the Securities
may be amended with the written consent of the Holders of at least a majority in principal amount
outstanding of the Securities and (b) any default or noncompliance with any provision may be waived
with the written consent of the Holders of a majority in principal amount outstanding of the
Securities. Subject to certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company, the Subsidiary Guarantors and the Trustee shall be entitled to amend
the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article 5 of the Indenture, or to provide for uncertificated Securities in addition to
or in place of certificated Securities, or to add guarantees with respect to the Securities,
including Subsidiary Guarantees, or to provide further security for the Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or the Subsidiary
Guarantors, or to comply with any requirement of the SEC in connection with qualifying the
Indenture under the Act, or to make any change that does not adversely affect the rights of any
Securityholder, or to make amendments to provisions of the Indenture relating to the form,
authentication, transfer and legending of the Securities, or in the event that such amendment is
expressly permitted pursuant to Section 11.01(b) of the Indenture or pursuant to the Security
Documents.

15. Defaults and Remedies

     Under the Indenture, Events of Default include (a) default for 30 days in payment of interest
on the Securities; (b) default in payment of principal on the Securities at maturity, upon
redemption pursuant to paragraph 5 of the Securities, upon acceleration or otherwise, or failure by
the Company to purchase Securities when required; (c) failure by the Company or any Subsidiary
Guarantor to comply with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any
grace period after final maturity) of other Indebtedness of the Company, a Subsidiary Guarantor or
any Significant Subsidiary if the amount accelerated (or so unpaid) exceeds $10.0 million; (e)
certain events of bankruptcy or insolvency with respect to the Company, the Subsidiary Guarantors
and the Significant Subsidiaries; (f) certain judgments or decrees for the payment of money in
excess of $10.0 million; (g) certain defaults with respect to Subsidiary Guarantees; and (h)
certain defaults with respect to the Security Documents. If an Event of Default occurs

10

 

and is continuing, the Trustee or the Holders of at least 25% in principal amount of the
Securities may declare all the Securities to be due and payable immediately. Certain events of
bankruptcy or insolvency are Events of Default which shall result in the Securities being due and
payable immediately upon the occurrence of such Events of Default.

     Securityholders may not enforce the Indenture or the Securities except as provided in the
Indenture. The Trustee may refuse to enforce the Indenture or the Securities unless it receives
indemnity or security satisfactory to it. Subject to certain limitations, Holders of a majority in
principal amount of the Securities may direct the Trustee in its exercise of any trust or power.
The Trustee may withhold from Securityholders notice of any continuing Default (except a Default in
payment of principal or interest) if it determines that withholding notice is in the interest of
the Holders.

16. Trustee Dealings with the Company

     Subject to certain limitations imposed by the Act, the Trustee under the Indenture, in its
individual or any other capacity, may become the owner or pledgee of Securities and may otherwise
deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise
deal with the Company or its Affiliates with the same rights it would have if it were not Trustee.

17. No Recourse Against Others

     A director, officer, employee or stockholder, as such, of the Company or the Trustee shall not
have any liability for any obligations of the Company under the Securities or the Indenture or for
any claim based on, in respect of or by reason of such obligations or their creation. By accepting
a Security, each Securityholder waives and releases all such liability. The waiver and release are
part of the consideration for the issue of the Securities.

18. Authentication

     This Security shall not be valid until an authorized signatory of the Trustee (or an
authenticating agent) manually signs the certificate of authentication on the other side of this
Security.

19. Abbreviations

     Customary abbreviations may be used in the name of a Securityholder or an assignee, such as
TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with
rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift
to Minors Act).

11

 

20. CUSIP Numbers

     Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures the Company has caused CUSIP numbers to be printed on the Securities and has directed
the Trustee to use CUSIP numbers in notices of redemption as a convenience to Securityholders. No
representation is made as to the accuracy of such numbers either as printed on the Securities or as
contained in any notice of redemption and reliance may be placed only on the other identification
numbers placed thereon.

21. Holders’ Compliance with Registration Rights Agreement.

     Each Holder of a Security, by acceptance hereof, acknowledges and agrees to the provisions of
the Registration Rights Agreement, including the obligations of the Holders with respect to a
registration and the indemnification of the Company to the extent provided therein.

22. Governing Law.

     THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.

     The Company shall furnish to any Securityholder upon written request and without charge to the
Securityholder a copy of the Indenture which has in it the text of this Security in larger type.
Requests may be made to:

Securus Technologies, Inc.

c/o H.I.G. Capital, LLC

1001 Brickell Bay Drive, 27th Floor

Miami, Florida 33131

Attention: Rob Wolfson

12

 

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

     (Print or type assignee’s name, address and zip code)

     (Insert assignee’s soc. sec. or tax I.D. No.)

     and irrevocably appoint                    agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.

 

Date: ___________________ Your Signature: _____________________________

 

Sign exactly as your name appears on the other side of this Security.

In connection with any transfer of any of the Securities evidenced by this certificate occurring
prior to the expiration of the period referred to in Rule 144(k) under the Securities Act after the
later of the date of original issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that
such Securities are being transferred in accordance with its terms:

	 	 	 	 	 
	CHECK ONE BOX BELOW
	 
	 	 	 	 
	o

	to the Company;
	 
	 	 	 	 
	 

	1. 	o
	 	to the Company; or pursuant to an effective registration statement under the
Securities Act of 1933; or
	 
	 	 	 	 
	 
	2. 	o
	 	inside the United States to a “qualified institutional buyer” (as
defined in Rule 144A under the Securities Act of 1933) that purchases for its own
account or for the account of a qualified institutional buyer to whom notice is given
that such transfer is being made in reliance on Rule 144A, in each case pursuant to
and in compliance with Rule 144A under the Securities Act of 1933; or
	 
	 	 	 	 
	 

	3. 	o
	 	outside the United States in an offshore transaction within the
meaning of Regulation S under the Securities Act in compliance with Rule 904 under the
Securities Act of 1933; or
	 
	 	 	 	 

13

 

	 	 	 	 	 
	 

	4. 	o
	 	pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933; or
	 
	 	 	 	 
	 
	5.	o
	 	to an institutional “accredited investor” (as defined in Rule
501(a)(1),(2),(3) or (7) under the Securities Act of 1933) that has furnished to the
Trustee a signed letter containing certain representations and agreements.

Unless one of the boxes is checked, the Trustee shall refuse to register any of
the Securities evidenced by this certificate in the name of any person other than
the registered holder thereof; provided, however, that if box (4)
is checked, the Trustee shall be entitled to require, prior to registering any
such transfer of the Securities, such legal opinions, certifications and other
information as the Company has reasonably requested to confirm that such transfer
is being made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, such as the exemption
provided by Rule 144 under such Act.

	 	 	 	 	 
	 	 	 
	 	 
	 	Signature 	 
	 	 	 
	 

Signature Guarantee:

	 	 	 
	 

	 	 
	Signature must be guaranteed

	 	Signature

     Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Registrar, which requirements include membership or participation in the Security Transfer
Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined
by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

14

 

TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.

     The undersigned represents and warrants that it is purchasing this Security for its own
account or an account with respect to which it exercises sole investment discretion and that it and
any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned’s foregoing representations in order to
claim the exemption from registration provided by Rule 144A.

	 	 	 	 	 
	Dated:
	 	 	 	 
	 

	 	 	 
	 

	 	 	Notice:  	To be executed by

an executive officer

15

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The following increases or decreases in this Global Security have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Principal amount of	 	 	Signature of	 
	 	 	Amount of decrease	 	 	Amount of increase	 	 	this Global	 	 	authorized officer	 
	 	 	in Principal	 	 	in Principal amount	 	 	Security following	 	 	of Trustee or	 
	Date of	 	amount of this	 	 	of this Global	 	 	such decrease or	 	 	Securities	 
	Exchange	 	Global Security	 	 	Security	 	 	increase	 	 	Custodian	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

16

 

OPTION OF HOLDER TO ELECT PURCHASE

     If you want to elect to have this Security purchased by the Company pursuant to Section 4.06,
4.10 or 4.19 of the Indenture, check the box: o

     If you want to elect to have only part of this Security purchased by the Company pursuant
to Section 4.06, 4.10 or 4.19 of the Indenture, state the amount in principal amount: $____________

	 	 	 	 	 	 	 
	Dated:

	 	 	 	Your Signature:	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	(Sign exactly as your name appears on the other
side of this Security.)

			
	Signature Guarantee:	 	
 

(Signature must be guaranteed)

     Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Registrar, which requirements include membership or participation in the Security Transfer
Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined
by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

17

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