OMNIBUS AMENDMENT TO LOAN DOCUMENTS
 
THIS OMNIBUS AMENDMENT TO LOAN DOCUMENTS (the “Amendment”) is made and entered
into effective as of September 1, 2010, by and among: [i] NTS/VIRGINIA
DEVELOPMENT COMPANY, a Virginia corporation having a mailing address of 10172
Linn Station Road, Louisville, Jefferson County, Kentucky 40223, and NTS/LAKE
FOREST II RESIDENTIAL CORPORATION, a Kentucky corporation having an address of
10172 Linn Station Road, Louisville, Jefferson County, Kentucky 40223 (each a
“Borrower”, and collectively, the “Borrowers”); [ii] ORLANDO LAKE FOREST JOINT
VENTURE, a Florida general partnership having a mailing address at 10172 Linn
Station Road, Louisville, Jefferson County, Kentucky 40223 (“Orlando Lake
Forest”), and [iii] NTS MORTGAGE INCOME FUND, a Delaware corporation having a
mailing address of 10172 Linn Station Road, Louisville, Jefferson County,
Kentucky 40223, and NTS GUARANTY CORPORATION, a Kentucky corporation having an
address at 10172 Linn Station Road, Louisville, Jefferson County, Kentucky 40223
(each a “Guarantor”, and collectively, the “Guarantors”), and [iv] PNC BANK,
NATIONAL ASSOCIATION, a national banking association, having an address of 500
West Jefferson Street, Fourth Floor, Louisville, Jefferson County, Kentucky
40202 (“Bank”).
 

 
RECITALS
 
1.   Borrowers and Bank are parties to that certain loan transaction, pursuant
to which Bank agreed to provide funds to Borrowers as evidenced by those certain
Loan Documents (as defined in that certain Eighth Mortgage Loan Modification
Agreement dated December 23, 2009 (the “Modification”) and as amended thereby,
collectively, the “Loan Documents”), which include that certain Seventh Amended
and Restated Promissory Note dated as of August 18, 2009 (as amended, the
“Note”), in the face principal amount of SIX MILLION SEVEN HUNDRED NINETY-NINE
THOUSAND FOUR HUNDRED SIXTY-EIGHT AND NO/100 DOLLARS ($6,799,468.00), made by
Borrowers payable to the order of Bank on or before September 1, 2010 (the
“Maturity Date”), all subject to the terms and conditions contained in the Loan
Documents (as amended, the “Loan”).  Certain terms defined in the Modification
when used and initially capitalized herein shall have the meanings ascribed to
them in the Modification unless expressly otherwise defined herein.
 
2.   The parties hereto also previously entered into a promissory note in the
original face principal amount of $1,385,544.00 dated August 18, 2009 (referred
to in the Modification as the “Section 21A Note”), but this loan currently has a
$0.00 balance and $0.00 of remaining available loan proceeds.
 
3.   The Note has a current principal balance of Three Million Fifty Seven
Thousand Two Hundred Fifty Four Dollars and 3/00 ($3,057,254.03), which,
together with any and all interest, charges and fees arising under the terms of
the Note and the other Loan Documents is collectively referred to herein as the
“Indebtedness”.
 

 
 
 

4.   The Indebtedness remains unpaid and Borrowers have requested and Bank has
agreed to the modification of the Loan Documents to extend the maturity date of
the Note from September 1, 2010 to April 1, 2011, to eliminate the six percent
(6%) interest rate floor, to amend the release price for the sale of real
estate, and to make such other modifications as are set forth herein, subject to
Borrowers’ compliance with the provisions set forth herein.
 
NOW THEREFORE, in consideration of the premises contained herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto and intending to be legally bound, Borrowers,
Orlando Lake Forest, Guarantors and Bank hereby agree that the Indebtedness
shall remain outstanding and the terms of such Indebtedness and the Loan
Documents shall be amended as follows:
 
ARTICLE 1.
 
AMENDMENT TO NOTE
 
The Note is, effective as of the date hereof and subject to the conditions
precedent set forth in Article 3 hereof, hereby amended as follows:
 
1.           Each reference to the “Maturity Date” as the term is defined
therein shall be amended to mean April 1, 2011.  Each reference to “September 1,
2010” as the maturity date of the Note shall be replaced by “April 1, 2011”.
 
2.           Effective December 1, 2010, the last paragraph on page 3 of the
Note (defining the interest rate) and the definitions of “Libor Based Rate”,
“Banking Day”, and “One Month Libor” contained on pages 3 and 4 of the Note
are  hereby amended and restated to read as follows:
 
Amounts outstanding under this Note will bear interest at a rate per annum which
is at all times equal to (A) the Daily LIBOR Rate plus (B) four hundred (400)
basis points (4.00%) (the “Interest Rate”).  Interest hereunder will be
calculated based on the actual number of days that principal is outstanding over
a year of 360 days. In no event will the rate of interest hereunder exceed the
maximum rate allowed by law.

If the Bank determines (which determination shall be final and conclusive) that,
by reason of circumstances affecting the eurodollar market generally, deposits
in dollars (in the applicable amounts) are not being offered to banks in the
eurodollar market for the selected term, or adequate means do not exist for
ascertaining the Daily LIBOR Rate, then the Bank shall give notice thereof to
the Borrower.  Thereafter, until the Bank notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the Interest Rate
for all amounts outstanding under this Note shall be equal to (A) the Base Rate
plus (B) three hundred (300) basis points (3.00%) (the “Alternate Rate”).

In addition, if, after the date of this Note, the Bank shall determine (which
determination shall be final and conclusive) that any enactment, promulgation or
adoption of or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by a governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Bank with any guideline, request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall make it unlawful or impossible for the
 

 
- 2 -
 

Bank to make or maintain or fund loans based on the Daily LIBOR Rate, the Bank
shall notify the Borrower.  Upon receipt of such notice, until the Bank notifies
the Borrower that the circumstances giving rise to such determination no longer
apply, the interest rate on all amounts outstanding under this Note shall be the
Alternate Rate.

For purposes hereof, the following terms shall have the following meanings:

“Base Rate” shall mean the higher of (A) the Prime Rate, and (B) the sum of the
Federal Funds Open Rate plus fifty (50) basis points (0.50%).  If and when the
Base Rate (or any component thereof) changes, the rate of interest with respect
to any amounts hereunder to which the Base Rate applies will change
automatically without notice to the Borrower, effective on the date of any such
change.

“Business Day” shall mean any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required by law to be closed
for business in Louisville, Kentucky.

“Daily LIBOR Rate” shall mean, for any day, the rate per annum determined by the
Bank by dividing (A) the Published Rate by (B) a number equal to 1.00 minus the
percentage prescribed by the Federal Reserve for determining the maximum reserve
requirements with respect to any eurocurrency fundings by banks on such
day.  The rate of interest will be adjusted automatically as of each Business
Day based on changes in the Daily LIBOR Rate without notice to the Borrower.

“Federal Funds Open Rate” shall mean, for any day, the rate per annum (based on
a year of 360 days and actual days elapsed) which is the daily federal funds
open rate as quoted by ICAP North America, Inc. (or any successor) as set forth
on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on
such other substitute Bloomberg Screen that displays such rate), or as set forth
on such other recognized electronic source used for the purpose of displaying
such rate as selected by the Bank (an “Alternate Source”) (or if such rate for
such day does not appear on the Bloomberg Screen BTMM (or any substitute screen)
or on any Alternate Source, or if there shall at any time, for any reason, no
longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate
Source, a comparable replacement rate determined by the Bank at such time (which
determination shall be conclusive absent manifest error); provided however, that
if such day is not a Business Day, the Federal Funds Open Rate for such day
shall be the “open” rate on the immediately preceding Business Day.  The rate of
interest charged shall be adjusted as of each Business Day based on changes in
the Federal Funds Open Rate without notice to the Borrower.

“Prime Rate” shall mean the rate publicly announced by the Bank from time to
time as its prime rate.  The Prime Rate is determined from time to time by the
Bank as a means of pricing some loans to its borrowers.  The Prime Rate is not
tied to any external rate of interest or index, and does not necessarily reflect
the lowest rate of interest actually charged by the Bank to any particular class
or category of customers.

“Published Rate” shall mean the rate of interest published each Business Day in
the Wall Street Journal “Money Rates” listing under the caption “London
Interbank Offered Rates” for a one month period (or, if no such rate is
published therein for any reason, then the Published Rate shall be the
eurodollar rate for a one month period as published in another publication
selected by the Bank).
 

 
- 3 -
 

    3.           The second paragraph on page 4 of the Note is hereby amended
and restated to read as follows:
 
“In addition to the other charges and the interest to be paid under this Amended
and Restated Note, Borrowers shall pay to Bank, at the time of sale of an
individual parcel from the lien and operation of the Deed of Trust and/or
Mortgage securing this Amended and Restated Note, an amount equal to the greater
of (i) one hundred percent (100%) of the net proceeds resulting from the sale,
or (ii) $100,000.”
 
4.           The third paragraph on page 4 of the Note is hereby amended and
restated to read as follows:
 
“Principal and interest payments shall be made in lawful money of the United
States of America to Bank at 500 W. Jefferson Street, 4th Floor, Louisville,
Kentucky 40202, or such other address as Bank may give to Borrowers, in
immediately available funds to Bank.”
 
5.           The last sentence of Section 1(a) on page 4 of the Note is hereby
amended and restated to read as follows:
 
“The entire unpaid principal balance of the indebtedness evidenced hereby,
together with all accrued but unpaid interest and all other sums payable to the
Bank pursuant to this Amended and Restated Note or any other Loan Document,
shall be due and payable in a single payment on April 1, 2011.”
 
6.           Section 4 of the Note entitled “Availability” is hereby amended to
reflect that there is no longer any availability remaining under the Loan, and
the Borrowers no longer have the right to borrow any additional sums under the
Note other than those amounts that have already been advanced and funded to
Borrowers prior to the date hereof.
 
7.           The first sentence of Section 9 of the Note entitled “Sale or
Encumbrance of the Real Estate” is hereby amended and restated to read as
follows:
 
“Except for sales of individual residential lot parcels contained in sections
21A and 21B (as defined in the Loan Documents) upon payment of the release price
to Bank in the amount equal to the greater of (i) one hundred percent (100%) of
the net proceeds resulting from the sale, or (ii) $100,000, or at a release
price to be negotiated between Bank and Borrower at the time of sale for any
other parcels, Borrowers agree not to sell or transfer real estate described in
the Loan Documents without the prior written consent of Bank, nor to further
encumber or mortgage such real estate without the prior written consent of Bank
except as expressly permitted by the Loan Agreement, and in the event of a
violation of this provision, Bank may, at its option, declare the entire
remaining unpaid balance of the Amended and Restated Note immediately due and
payable and institute foreclosure proceedings.”
 
8.           Each reference in the Note to the term “Amended and Restated Note”
is hereby amended to mean the Note as further amended by this Amendment.
 

 
- 4 -
 

This amendment shall not constitute a novation, repayment or satisfaction of the
Indebtedness evidenced by the Note.
 
 
ARTICLE 2.
 
AMENDMENT TO DEED OF TRUST AND OTHER LOAN DOCUMENTS
 
The Deed of Trust (as defined in the Modification) and each of the other Loan
Documents are, effective as of the date hereof and subject to the conditions
precedent set forth in Article 3 hereof, hereby amended as follows:
 
1.           Each reference to the maturity date of the Note of September 1,
2010 contained in the Loan Documents is hereby amended to mean “April 1, 2011”.
 
2.           Any reference in the Loan Documents to any additional availability
under the Note is hereby deleted, and the parties agree that there is no longer
any availability remaining under the Loan, and the Borrowers no longer have the
right to borrow any additional sums under the Note other than those amounts that
have already been advanced and funded to Borrowers prior to the date hereof.
 
3.           Borrowers and Bank agree that any prior release prices set forth in
the Loan Documents shall be deleted in their entirety and Bank agrees to release
(a) such individual parcels contained in sections 21A or 21B (as defined in the
Loan Documents) of the property subject to the lien of the Deed of Trust upon
payment of a release price to Bank in the amount equal to the greater of (i) one
hundred percent (100%) of the net sales proceeds resulting from the sale, or
(ii) $100,000; and (b) such other parcels or acreage from each section of the
property subject to the lien of the Deed of Trust upon payment of a release
price to Bank an amount to be negotiated between the parties on a case by case
basis at the time of the sale of each parcel.”
 
Each reference to the Note or any of the other Loan Documents contained in the
Loan Documents is hereby deemed to refer to said Loan Documents as the same have
been amended by this Amendment.
 
ARTICLE 3.
 
CONDITIONS TO EFFECTIVENESS
 
This Amendment shall become effective when, and only when, Bank shall have
received this Amendment duly executed by Borrowers, Orlando Lake Forest and
Guarantors, together with each of the additional required items set forth below,
in form and substance satisfactory in all respects to Bank in its sole
discretion and when Borrowers have satisfied each of the other conditions set
forth in this Article to the complete satisfaction of Bank:
 
3.1   Bank shall have received copies, certified by representatives of Borrowers
acceptable to Bank as being accurate and complete, of resolutions of the members
of the Borrowers authorizing the execution, delivery and performance of this
Amendment.
 

 
- 5 -
 

3.2   Bank shall have received all evidence of paid real estate taxes and
insurance due and payable as of the date hereof as Bank so requires.
 
3.3   Bank shall have received such other documents, instruments and
certificates as Bank may reasonably request to insure the binding effect in
accordance with the terms hereof and of the Loan Documents and to establish the
security for the benefit of Bank contemplated thereby.
 
ARTICLE 4.
 
RESTATEMENT OF REPRESENTATIONS,
WARRANTIES AND COVENANTS
 
Except as expressly modified by the terms of this Amendment, Borrowers, Orlando
Lake Forest and each of the Guarantors hereby restates reaffirms and confirms as
of the date of this Amendment each of the representations, warranties and
covenants contained in the Loan Documents, as modified by this
Amendment.  Orlando Lake Forest and the Guarantors hereby join in the execution
of this Amendment for purposes of consenting to and ratifying the same.
 
ARTICLE 5.
 
NO NOVATION
 
This Amendment is not intended to, and shall not, affect a novation of the
obligations expressed in the Loan Documents, nor is the Deed of Trust (as
defined in the Modification) or any of the other Loan Documents intended to be
released, altered or changed in any manner except as expressly provided herein,
and the lien of such documents shall continue to be in full force and effect
from and after the date of this Amendment as it was prior to the date hereof.
 
ARTICLE 6.
 
CONFIRMATION OF NO SET-OFFS, DEFENSES OR CLAIMS
 
Each of the Borrowers, Orlando Lake Forest and the Guarantors hereby acknowledge
and agree that neither it nor any other party has any defenses or offsets to the
payment of any amount due to Bank under the Note or under any of the other Loan
Documents and, further, that neither it nor any other party has any defenses to
the performance of any of the obligations arising under or in connection with
the Note or under or in connection with any of the other Loan Documents.
 
ARTICLE 7.
 
EXPENSES OF AMENDMENT
 
Borrowers agree to reimburse Bank for all expenses incurred by Bank in
connection with the preparation, execution, delivery, recordation and
performance of this Amendment, including, without limitation, reasonable fees of
legal counsel to Bank.
 

 
- 6 -
 
 
ARTICLE 8.
 
INCORPORATION BY REFERENCE
 
Except as expressly modified by this Amendment, all terms and conditions of the
Loan Documents shall remain in full force and effect as they were immediately
prior to execution and delivery of this Amendment, and those terms and
conditions as modified are incorporated herein by this reference and shall
govern in all respects this Amendment.  Upon the effectiveness of this
Amendment, each reference in the Loan Documents to the terms “hereunder,”
“hereof,” “herein,” or words of like import, shall mean and shall be a reference
to the Loan Documents as amended by all prior amendments and by this Amendment.
                                
ARTICLE 9.
 
GOVERNING LAW
 
This Amendment shall be governed by and construed in accordance with the laws of
the Commonwealth of Kentucky.
 
ARTICLE 10.
 
COUNTERPARTS
 
This Amendment may be executed in multiple counterparts, each of which shall
constitute an original, but all of which taken together shall constitute one and
the same agreement.
 
 

 
- 7 -
 

IN WITNESS WHEREOF, this Amendment has been executed by the parties hereto
effective as of the date first set forth above.
 

 
BORROWERS:
 
 
NTS/VIRGINIA DEVELOPMENT COMPANY,
a Virginia corporation
 
 
By:     /s/ Neil A. Mitchell         
                      Neil A. Mitchell, Senior Vice President
 

 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )

On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Neil A. Mitchell, who acknowledged
himself to be the Senior Vice President of NTS/VIRGINIA DEVELOPMENT COMPANY, a
Virginia corporation, and that he, in such capacity, being authorized to do so,
executed the foregoing instrument for the purposes therein contained by signing
on behalf of said corporation.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 

 /s/ Susan M. Howard      
Notary Public
My commission expires:     April 27, 2014   

 
                                [SEAL]

 

 
- 8 -
 

BORROWERS:
 
 
NTS/LAKE FOREST II
RESIDENTIAL CORPORATION,
a Kentucky corporation
 
 
By:      /s/ Neil A. Mitchell         
    Neil A. Mitchell, Senior Vice President
 

 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )

On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Neil A. Mitchell, who acknowledged
himself to be the Senior Vice President of NTS/LAKE FOREST II RESIDENTIAL
CORPORATION, a Kentucky corporation, and that he, in such capacity, being
authorized to do so, executed the foregoing instrument for the purposes therein
contained by signing on behalf of said corporation.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 

/s/ Susan M. Howard      
Notary Public
 
My commission expires:     April 27, 2014   

 
                                [SEAL]

 
 
- 9 -
 

ORLANDO LAKE FOREST:
 
 
ORLANDO LAKE FOREST JOINT
VENTURE, a Florida general partnership
 
 
By:         Orlando Lake Forest, Inc., a Florida
corporation, Managing General Partner
 
 
By:  /s/ Neil A. Mitchell         
       Neil A. Mitchell, Senior Vice President
 

 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )

On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Neil A. Mitchell, who acknowledged
himself to be the Senior Vice President of Orlando Lake Forest, Inc., a Florida
corporation, Managing General Partner of Orlando Lake Forest Joint Venture, a
Florida general partnership, and that he, in such capacity, being authorized to
do so, executed the foregoing instrument for the purposes therein contained by
signing on behalf of said general partnership.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 

/s/ Susan M. Howard      
Notary Public
 
My commission expires:     April 27, 2014   

 
                                [SEAL]

 

 
 
- 10 -
 

GUARANTORS:
 
 
NTS MORTGAGE INCOME FUND,
a Delaware corporation
 
 
By: /s/ Brian F. Lavin       
 
Print Name: Brian F. Lavin                      
 
Title: President                                         

 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )

On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Brian F. Lavin, who acknowledged
himself to be the President of NTS MORTGAGE INCOME FUND, a Delaware corporation,
and that he, in such capacity, being authorized to do so, executed the foregoing
instrument for the purposes therein contained by signing on behalf of said
corporation.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 
 
/s/ Susan M. Howard      
Notary Public
My commission expires:     April 27, 2014   

 
                                [SEAL]

 

 
- 11 -
 

GUARANTORS:
 
 
NTS GUARANTY CORPORATION,
a Kentucky corporation
 
 
By: /s/ Brian F. Lavin       
 
Print Name: Brian F. Lavin                      
 
Title: President                                         
 

 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )

On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Brian F. Lavin, who acknowledged
himself to be the President of NTS GUARANTY CORPORATION, a Kentucky corporation,
and that he, in such capacity, being authorized to do so, executed the foregoing
instrument for the purposes therein contained by signing on behalf of said
corporation.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 

/s/ Susan M. Howard      
Notary Public
My commission expires:     April 27, 2014   

 
                                [SEAL]

 

 
- 12 -
 

BANK:
 
 
PNC BANK, NATIONAL ASSOCIATION,
a national banking association
 
By: /s/ Henry R. Snyder, IV         
      Henry R. Snyder, IV, Senior Vice President
 

 
 

 
COMMONWEALTH OF KENTUCKY              )
) SS:
COUNTY OF JEFFERSON                                  )
 
On this, the 28th day of December, 2010, before me, a Notary Public, the
undersigned officer, personally appeared Henry R. Snyder, IV, who acknowledged
himself to be the Senior Vice President of PNC Bank, National Association, a
national banking association, and that he, in such capacity, being authorized to
do so, executed the foregoing instrument for the purposes therein contained by
signing on behalf of said banking association.
 

IN WITNESS WHEREOF, I hereunto set my hand and official seal.
 

/s/ Cheryl Adams      
Notary Public
My commission expires:     October 21, 2013   

 
                                [SEAL]

 
- 13 -
 

THIS INSTRUMENT PREPARED BY:
 
/s/ Michael B. Vincenti      
Michael B. Vincenti, Esq.
WYATT, TARRANT & COMBS, LLP
500 West Jefferson Street, Suite 2700
Louisville, Kentucky  40202
(502) 562-7518
 
 
- 14 -