Document:

Unassociated Document

     

    
      	
              Exhibit
  4.1

            

    

     

      
        

      

    

    
      

       

      FOURTH
SUPPLEMENTAL INDENTURE

      

      KH
FUNDING COMPANY, a Maryland corporation,

      as
obligor

      

      

      Series
3 Senior Secured Investment Debt Securities

      

      $220,000,000.00

      

      and

      

      Series
4 Subordinated Unsecured Investment Debt Securities

      

      $30,000,000.00

      

      WELLS FARGO BANK, NATIONAL ASSOCIATION
(as successor by merger to WELLS FARGO BANK
MINNESOTA,  NATIONAL ASSOCIATION), a national banking
association,

      as
trustee with respect to the Series 3 Senior Secured Investment Debt
Securities,

      

      

      LAW
DEBENTURE TRUST COMPANY OF NEW YORK,

      a
New York chartered trust company,

      as
trustee with respect to the Series 4 Subordinated Unsecured Investment Debt
Securities

      

      

      Dated
as of July 29, 2010

      

      

      Supplementing
the Indenture

      Dated
as of August 2, 2004

      as
supplemented and amended by a

      First
Supplemental Indenture

      Dated
as of July 1, 2005,

      an
Amended and Restated Second Supplemental Indenture

      Dated
as of January 17, 2008, and

      as
supplemented and amended by a

      Third
Supplemental Indenture

      Dated
as of March 26, 2010

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      FOURTH
SUPPLEMENTAL INDENTURE

       

      THIS FOURTH SUPPLEMENTAL INDENTURE
(this “Fourth Supplemental
Indenture”) is entered into as of July 29, 2010, by and among KH FUNDING
COMPANY, a Maryland corporation (the “Company”), WELLS FARGO BANK,
NATIONAL ASSOCIATION (as successor by merger to WELLS FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION), a national banking association, as trustee with respect
to the Series 3 Securities (the “Series 3 Trustee”), and LAW
DEBENTURE TRUST COMPANY OF NEW YORK, a New York chartered trust company, as
trustee with respect to the Series 4 Securities (the “Series 4
Trustee”).

      

      RECITALS:

      

      WHEREAS, the Company and the Series 3
Trustee are parties to that certain Indenture, dated as of August 2, 2004, as
amended and supplemented to date (the “Indenture”), relating to the
Company’s Series 3 Senior Secured Investment Debt Securities (the “Series 3 Securities”) and
Series 4 Subordinated Unsecured Investment Debt Securities (the “Series 4 Securities” and
together with the Series 3 Securities, the “Securities”);

      

      WHEREAS, the Company appointed Series 3
Trustee as the Trustee for both the Series 3 Securities and the Series 4
Securities under the Indenture;

      

      WHEREAS, Section 7.8 of the Indenture
provides that the Trustee may at any time resign with respect to any series of
Securities of one or more series by giving written notice of such resignation to
the Company, effective upon the acceptance by a successor Trustee of its
appointment as a successor Trustee;

      

      WHEREAS, the Series 3 Trustee has
delivered written notice to the Company of its resignation as Trustee with
respect to the Series 4 Securities;

      

      WHEREAS, Section 7.8 of the Indenture
provides that, if the Trustee shall resign, the Company shall promptly appoint a
successor Trustee;

      

      WHEREAS, Section 7.8 of the Indenture
provides that any successor Trustee appointed in accordance with the Indenture
shall execute, acknowledge and deliver to the Company and to its predecessor
Trustee an instrument accepting such appointment under the Indenture, and
thereupon the resignation of the predecessor Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become vested with all rights, powers, protections, indemnities, immunities,
duties and obligations of the predecessor Trustee;

      

      WHEREAS, the Company desires to appoint
Series 4 Trustee as Trustee with respect to the Series 4 Securities to succeed
Series 3 Trustee in such capacity under the Indenture; and

      

      WHEREAS, Series 4 Trustee is willing to
accept such appointment as successor Trustee, under the Indenture;

      

      NOW, THEREFORE, the Company, Series 3
Trustee and Series 4 Trustee, for and in consideration of the premises and of
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, hereby consent and agree as follows:

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      

      ARTICLE
1

      THE
SERIES 3 TRUSTEE

      

      1.1.           Pursuant
to Section 7.8 of the Indenture, Series 3 Trustee has delivered a letter of
resignation to the Company, attached hereto as Exhibit A, pursuant
to which Series 3 Trustee has resigned as Trustee with respect to the Series 4
Securities, but will retain the role of Trustee with respect to the Series 3
Securities.

      

      1.2.           Series
3 Trustee hereby represents and warrants to Series 4 Trustee that:

      

      (a)           No
covenant or condition contained in the Indenture has been waived by Series 3
Trustee or, to the best knowledge of responsible officers of Series 3 Trustee’s
corporate trust department, by the Holders of the percentage in aggregate
principal amount of the Securities required by the Indenture to effect any such
waiver.

      

      (b)           There
is no action, suit or proceeding pending or, to the best knowledge of
responsible officers of Series 3 Trustee’s corporate trust department,
threatened against Series 3 Trustee before any court or any governmental
authority arising out of any act or omission of Series 3 Trustee as Trustee
under the Indenture.

      

      (c)           As
of the date of this Fourth Supplemental Indenture, Series 3 Trustee will hold no
moneys or property with respect to the Series 4 Securities under the
Indenture.

      

      (d)           This
Fourth Supplemental Indenture has been duly authorized, executed and delivered
on behalf of Series 3 Trustee and constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms, except as enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application relating to or affecting
enforcement of creditors’ rights and the exercise of judicial discretion in
accordance with general principles of equity.

      

      (e)           To
the best knowledge of the responsible officers of the Series 3 Trustee assigned
to its corporate trust department, the Series 3 Trustee has lawfully discharged
its duties as Trustee under the Indenture.

      

      (f)           As
of or promptly after the date of this Fourth Supplemental Indenture, the Series
3 Trustee shall deliver to the Series 4 Trustee the items listed on Schedule A
annexed hereto.

      

      (g)           Series
3 Trustee hereby assigns, transfers, delivers and confirms to Series 4 Trustee
all right, title and interest of Series 3 Trustee in and to the trust under the
Indenture and all the rights, powers, protections, indemnities, immunities,
duties, obligations and trusts of the Trustee under the Indenture, solely with
respect to the Series 4 Securities.  Series 3 Trustee shall execute
and deliver such further instruments and shall do such other things as Series 4
Trustee may reasonably require so as to more fully and certainly vest and
confirm in Series 4 Trustee all the rights, powers, protections, indemnities,
immunities, duties, obligations and trusts hereby assigned, transferred,
delivered and confirmed to Series 4 Trustee as Trustee for the Series 4
Securities.

      

      ARTICLE
2

      THE
COMPANY

      

      2.1.           The
Company hereby accepts the resignation of Series 3 Trustee as Trustee for the
Series 4 Securities under the Indenture.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

      2.2.           The
Company hereby certifies that it has duly authorized certain officers of the
Company to:  (a) accept Series 3 Trustee’s resignation as Trustee for
the Series 4 Securities under the Indenture; (b) appoint Series 4 Trustee as
Trustee for the Series 4 Securities under the Indenture; and (c) execute and
deliver such agreements and other instruments as may be necessary or desirable
to effectuate the succession of Series 4 Trustee as Trustee for the Series 4
Securities  under the Indenture.

      

      2.3.           The
Company hereby appoints Series 4 Trustee as Trustee for the Series 4 Securities
under the Indenture to succeed to, and hereby vests Series 4 Trustee with, all
the rights, powers, protections, indemnities, immunities, duties and obligations
of Series 3 Trustee related to the Series 4 Securities under the Indenture with
like effect as if originally named as Trustee for the Series 4 Securities in the
Indenture.

      

      2.4.           The
Company hereby represents and warrants to Series 3 Trustee and Series 4 Trustee
that:

      

      (a)           The
Company is a corporation duly and validly organized and existing pursuant to the
laws of the State of Maryland.

      

      (b)           The
Indenture was validly and lawfully executed and delivered by the Company and the
Securities were validly issued by the Company.

      

      (c)           As
of June 30, 2010, the outstanding aggregate principal amount of the Series 4
Securities is $1,284,613.40.

      

      (d)           Except
as set forth in Exhibit B, the
Company has performed or fulfilled prior to the date hereof, and will continue
to perform and fulfill after the date hereof, each covenant, agreement,
condition, obligation and responsibility under the Indenture.

      

      (e)           Except
as set forth in Exhibit B, no event
has occurred and is continuing which is, or after notice or lapse of time would
become, an Event of Default under the Indenture.

      

      (f)           No
covenant or condition contained in the Indenture has been waived by the Company
or, to the best of the Company’s knowledge, by Holders of the percentage in
aggregate principal amount of the Securities required to effect any such
waiver.

      

      (g)           There
is no action, suit or proceeding pending or, to the best of the Company’s
knowledge, threatened against the Company before any court or any governmental
authority arising out of the Company’s performance or satisfaction of, or
failure to perform or satisfy, any covenant or other obligation under the
Indenture.

      

      (h)           This
Fourth Supplemental Indenture has been duly authorized, executed and delivered
on behalf of the Company and constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms, except as enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application relating to or affecting
enforcement of creditors’ rights and the exercise of judicial discretion in
accordance with general principles of equity.

      

      (i)           All
conditions precedent relating to (i) the appointment of Law Debenture Trust
Company of New York as successor Trustee and (ii) the execution of this Fourth
Supplemental Indenture under the Indenture have been complied with by the
Company.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      ARTICLE
3

      THE
SERIES 4TRUSTEE

      

      3.1.           Series
4 Trustee hereby represents and warrants to Series 3 Trustee and to the Company
that:

      

      (a)           Series
4 Trustee is not disqualified and is eligible to act as Trustee for the Series 4
Securities in accordance with the provisions of the Indenture, including Section
7.10 thereof.

      

      (b)           This
Fourth Supplemental Indenture has been duly authorized, executed and delivered
on behalf of Series 4 Trustee and constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms, except as enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application relating to or affecting
enforcement of creditors’ rights and the exercise of judicial discretion in
accordance with general principles of equity.

      

      3.2.           Series
4 Trustee hereby accepts its appointment as successor Trustee for the Series 4
Securities under the Indenture and accepts the rights, powers, protections,
indemnities, immunities, duties and obligations of Series 3 Trustee as Trustee
for the Series 4 Securities under the Indenture, upon the terms and conditions
set forth therein, with like effect as if originally named as Trustee for the
Series 4 Securities under the Indenture.

      

      3.3.           References
in the Indenture to “Corporate Trust Office” with respective to the Series 4
Securities or other similar terms shall be deemed to refer to the principal
corporate trust office of Series 4 Trustee, which is presently located at 400
Madison Avenue, 4th Floor, New York, New York 10017.

      

      3.4.           Promptly
after the effective date of this Fourth Supplemental Indenture, the Series 4
Trustee shall cause a notice to be sent to each Holder of the Securities in
accordance with the provisions of Section 7.8 of the Indenture.

      

      ARTICLE
4

      MISCELLANEOUS

      

      4.1.           The
Parties hereto acknowledge and confirm that Series 3 Trustee is resigning as
Trustee only with respect to the Series 4 Securities and that Series 3 Trustee
shall remain as the Series 3 Securities Trustee under the
Indenture.  All the rights, powers and duties of Series 3 Trustee
under the Indenture with respect to the Series 3 Securities shall continue to be
vested in Series 3 Trustee until Series 3 Trustee resigns or is removed as a
Trustee pursuant to the Indenture, and nothing contained herein shall alter or
amend such rights, powers or duties.

      

      4.2.           Except
as otherwise expressly provided herein or unless the context otherwise requires,
all terms used herein which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

      

      4.3.           Nothing
in this Fourth Supplemental Indenture shall limit (a) Series 3 Trustee’s rights,
privileges and benefits under the Indenture with respect to its role as the
Trustee for the Series 3 Securities, and (b) Series 3 Trustee’s right to
indemnity by the Company pursuant to Section 7.7 of the Indenture in its
capacity as Trustee for the Securities.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      

      4.4.           This
Fourth Supplemental Indenture does not constitute a waiver or assignment by the
Series 3 Trustee of any compensation, reimbursement, expenses or indemnity to
which it is or may be entitled as Trustee of the Series 4 Securities pursuant to
the Indenture.

      

      4.5.           The
Company acknowledges its obligation set forth in Section 7.7 of the Indenture to
indemnify Series 3 Trustee for, and to hold Series 3 Trustee harmless against,
any loss, liability or expense incurred without negligence or willful misconduct
on the part of Series 3 Trustee and arising out of or in connection with the
acceptance or administration of the trust evidenced by the Indenture (which
obligation shall survive the execution hereof).  The Company also
acknowledges and reaffirms it obligations to the Series 4 Trustee as set forth
in Section 7.7 of the Indenture, which obligations to the Series 4 Trustee shall
survive the execution hereof.  Series 4 Trustee does not assume
responsibility for or any liability in connection with any negligence or other
willful misconduct or any other act or omission on the part of Series 3 Trustee
or its agents in connection with such persons’ performance of their respective
trusts, duties and obligations under the Indenture in such person’s capacity as
Trustee.

      

      4.6.           The
internal law of the State of Maryland shall govern this Fourth Supplemental
Indenture and the Securities, without regard to conflicts of laws provisions
thereof.

      

      4.7.           This
Fourth Supplemental Indenture may be executed in any number of counterparts each
of which shall be an original, but such counterparts shall together constitute
but one and the same instrument.  The exchange of copies of this
Fourth Supplemental Indenture and of signature pages by facsimile or PDF
transmission shall constitute effective execution and delivery of this Fourth
Supplemental Indenture as to the parties hereto and may be used in lieu of an
original of this Fourth Supplemental Indenture for all
purposes.  Signatures of the parties hereto transmitted by facsimile
or PDF transmission shall be deemed to be their original signatures for all
purposes.

      

      4.8.           This
Fourth Supplemental Indenture may not be amended or altered in any way without
the written consent of each party hereto.

      

      4.9.           Any
notice, instruction, direction, request or other communication by the parties
hereto is duly given if in writing and delivered in person or mailed by
first-class mail (registered or certified, return receipt requested), telecopier
or overnight air courier guaranteeing next day delivery, to the other’s
address:

       

      If to the Company:

      

      KH Funding Company

      10801 Lockwood Drive, Suite
370

      Silver Spring, Maryland
20901

      Telecopy:

      Attention:  Robert L. Harris,
President

      

      With a copy to:

      

      Gordon Feinblatt, Rothman, Hoffberger
& Hollander, LLC

      223 E. Redwood Street

      Baltimore, MD 21202

      Telecopy: 410-576-4196

      Attention:  Andrew Bulgin,
Esq.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

         

      

      If to the Series 3 Trustee
:

      

      Wells Fargo Bank, National
Association

      45 Broadway, 12th Floor

      New York, New York 10006

      Telecopy:  866-524-4681

      Attention:  James R. Lewis,
Vice President

      

      With a copy to:

      

      Thompson Hine LLP

      335 Madison Ave. 12th
Floor

      New York, New York 10017

      Telecopy:  212-344-6101

      Attention:  Irving Apar,
Esq.

      

      If to the Series 4 Trustee
:

      

      Law Debenture Trust Company of New
York

      400 Madison Avenue

      New York, New York 10017

      Telecopy: 212-750-1361

      Attention:  James D. Heaney,
Managing Director

      

      With a copy to:

      

      Pryor Cashman LLP

      7 Times Square

      New York, New York 10036

      Telecopy: 212-798-6355

      Attention:  Tina N. Moss,
Esq.

      

      

      4.10.           This
Fourth Supplemental Indenture is effective as of the date first set forth
above.

      

      

      

      [Signature
page to follow]

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      

      IN WITNESS WHEREOF, the parties hereto
have caused this Fourth Supplemental Indenture to be duly executed, all as of
the day and year first above written.

      

      
        	 
      	 	 
      	 
	 
      	KH
      FUNDING COMPANY,	 
	 
      	as
      the Company	 
	 	 	 
	 	 	 	 
	 
      	By: 	
                /s/ Robert L.
      Harris  

              	 
	 
      	Name:  Robert
      L. Harris 
Title:
      President	 
	 
      	 	 
      	 
	 
      	WELLS
      FARGO BANK, NATIONAL ASSOCIATION,
	 
      	as
      Series 3 Trustee	 
	 	 	 
	 
      	 	 
      	 
	 
      	By:	
                 /s/ James R.
      Lewis           

              	 
	 
      	Name:  James
      R. Lewis 
Title:  Vice
      President	 
	 
      	 	 
      	 
	 
      	 	 
      	 
	 
      	LAW
      DEBENTURE TRUST COMPANY OF NEW YORK,
	 
      	as
      Series 4 Trustee	 
	 	 	 
	 
      	 	 
      	 
	 
      	By:	
                 /s/ James D.
      Heaney                                          

              	 
	 
      	Name:
      James D. Heaney 
Title:
      Managing Director	 

      

       

       

      [Signature page]

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Exhibit
A

      Letter
of Resignation

      

      

      

      See
attached Letter of Resignation.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Exhibit
B

      Events
of Default

      

      

      See
attached Notice of Default.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Annex
A

      Documents
(to the extent available) to be delivered to the Series 4 Trustee

      

      
        	
                1)

              	
                Copies
      of the Indenture and any supplemental
  indentures.

              

      

      

      
        	
                2)

              	
                Index
      of closing documents and copies of each closing document referenced
      therein.

              

      

      

      
        	
                3)

              	
                Copies
      of any official notices sent by the Trustee to all the Holders of the
      Series 4 Securities pursuant to the terms of the
  Indenture.Unassociated Document

    
      	
              

            	
              C.
      K. COOPER & COMPANY

              Our
      Insight, Your Growth

            

    

    

     

    July 29,
2010

     

    Mr.
Dwight Babcock

    IsoRay,
Inc.

    350 Hills
Street, Suite 106 

    Richland,
WA 99354

     

    RE:
Amendment of Sales Agreement, Dated April 22, 2010

     

    Dear Mr.
Babcock:

     

    Reference
is hereby made to that certain Sales Agreement between us, dated as of April 22,
2010 (the "Sales
Agreement"). For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree that the
Sales Agreement shall be amended as follows:

     

    1.
Section 11(d) of the Sales Agreement is hereby amended in its entirety to read
as follows:
"Unless earlier terminated pursuant to this Section 11, this Agreement shall
automatically terminate upon the first to occur of (i) December 31, 2010, and
(ii) the issuance and sale of the Maximum Amount of Shares through CKCC pursuant
to this Agreement."

     

    This letter shall be construed in
connection with and as part of the Sales Agreement, and all terms, conditions, and covenants set
forth in the Sales Agreement and each other instrument or agreement referred to therein, as
applicable, except as herein amended, are hereby ratified and confirmed and shall remain in full force and
effect.

     

    This
letter may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

     

    [Signature
Page Follows]

    
       

    

     

    18300 Von
Karman Ave., Suite 700, Irvine,
California 92612

    TEL: 949
477-9300  FAX: 949 477-9211 
TOLL-FREE: 888 477-9301  administration@ckcooper.com

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    To
acknowledge your acceptance of the terms of this letter, please so indicate in
the space provided below.

     

    
      
        	 	 	Sincerely,	 
	 	 	 	 
	 	 	C. K. Cooper & Company,
      Inc.	 
	 	 	 	 
	
                 

              	
                 

              	/s/
      Alexander G. Montano	 
	 	 	Alexander
      G. Montano	 
	 	 	
                Managing
      Director

              	 

      

    

     

     

    Accepted
and agreed as of the date first above written:

     

     

    IsoRay,
Inc.

     

    /s/ Dwight
Babcock

    Dwight
Babcock

    Chief
Executive Officer

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