1.     All right, title and interest of Borrower, including any after-acquired title or reversion, in and to the ways, easements, streets, alleys, passages, water, water courses, riparian rights, rights, liberties and privileges in any way appertaining to the Land; and

          2.      All real property leases, contracts, rents, issues, proceeds and profits accruing and to accrue from the Mortgaged Property (defined below); and

          3.      All buildings, structures and improvements of every kind and description now or hereafter constructed or placed on the Land (collectively, the “Improvements”) and all materials intended for construction, reconstruction, alteration and repairs of the same, all of which shall be subjected to and encumbered by the lien and security interest created by this Mortgage immediately upon the delivery thereof to the Mortgaged Property, and all fixtures and articles of personal property in which Borrower now has or

at any time hereafter acquires an interest and which are attached to or contained in and used in connection with the Mortgaged Property, and all renewals or replacements thereof or articles in substitution therefor, without regard to whether the same are or shall be attached to the buildings in any manner; it being mutually agreed that all such property shall, so far as permitted by law, be deemed to be fixtures and a part of the realty, security for the Obligations (as hereinafter defined) and covered by this Mortgage, and as to the balance of such property, this Mortgage is a security agreement for the purpose of creating hereby a security interest therein, securing the Obligations for the benefit of Bank; and

          4.      All right, title and interest now owned or hereafter acquired by Borrower in and to any leases for equipment of any kind or nature used in connection with the Mortgaged Property; and

          5.      All proceeds of the conversion, voluntary or involuntary, of any of the foregoing property into cash or liquidated claims, including but not limited to the proceeds of insurance and all awards payable by reason of the condemnation (or private sale in lieu thereof) of all or any portion of any such property (whether temporary or permanent), together with any and all unearned premiums accrued, accruing or to accrue under any and all insurance policies now or hereafter obtained by Borrower; and

          6.      All permits, licenses, governmental approvals and grants pertaining to the aforementioned property, to the extent that the same may lawfully be assigned.

          (a)      the payment when due of all principal, interest and other sums payable pursuant to the Note;

          (b)      the payment, as and when due, of all sums which may be expended or advanced by the Bank pursuant to any term or provision of this Mortgage or of any other agreement delivered in connection with this transaction, including but not limited to the Assignment of Leases, Rents, Contracts, Income and Proceeds from Borrower to Bank, the Environmental Indemnity Agreement from Borrower to Bank, the Covenant Agreement from Borrower to Bank, the Conditional Assignment of Leases and Rents from Borrower to Bank and UCC-1 Financing Statements, all dated of even date herewith (collectively, the “Loan Documents”);

          (c)      the payment, as and when due, of all unpaid advances of the Bank with respect to the Mortgaged Property for the payment of taxes, assessments, insurance premiums or reasonable out-of-pocket costs incurred in the protection or operation of the Mortgaged Property as provided in the Kentucky Revised Statutes; and

          (d)     the unpaid balances of any loan advances made this date or subsequent to recordation hereof, to the extent that the total unpaid loan indebtedness secured hereby, exclusive of the interest thereon, does not exceed Thirty-Five Million Four Hundred Seventy-Seven Thousand Eight Hundred Ninety-Seven and 16/100 Dollars ($35,477,897.16);

          1.      Payment of Indebtedness . Borrower shall pay promptly the principal of and interest on the indebtedness evidenced by the Note at the time and in the manner provided therein.

          2.      Impositions and Insurance Premiums . (a) Borrower shall (i) pay, or cause to be paid, not later than the last day on which the same may be paid without penalty or interest, all real estate taxes, general and special assessments, water and sewer rents, rates, charges, impositions and liens (collectively, “Impositions”) which are now or hereafter imposed by law upon the Mortgaged Property, and (ii) pay, or cause to be paid, not less than thirty (30) days prior to the date on which each such policy of insurance would be subject to cancellation or non-renewal for failure to pay premiums therefor, all premiums becoming payable on all insurance required by this Mortgage to be maintained by Borrower with respect to the Mortgaged Property (“Insurance Premiums”). If failure of the Borrower to pay Impositions or Insurance Premiums in accordance with the foregoing which continues for ten (10) days after written notice from the Bank shall be a default hereunder. Borrower shall furnish to the Bank evidence reasonably satisfactory to the Bank of payment of the Impositions prior to the last day on which each Imposition may be paid without penalty or interest, and, in the case of Insurance Premiums, not less than ten (10) days prior to the date on which such policies would be subject to cancellation or non-renewal for non-payment of premiums therefor.

          (a)      In the event of the passage after the date of this Mortgage of any federal, state, municipal, or other governmental law, order, rule, or regulation deducting from the value of the Mortgaged Property, for the purpose of taxation,

any lien thereon, taxing the lien, or in any manner changing or modifying the laws now in force governing the taxation of mortgages or debts secured by mortgages or the manner of collecting taxes so as to impose a tax hereon or otherwise adversely to affect the yield to the Bank on the indebtedness evidenced by the Note in a material way, or upon the rendition by a court of competent jurisdiction of any decision or ruling to the effect that any material undertaking of Borrower under this Mortgage is inoperative or unenforceable, then, in any such event, at the option of the Bank upon written notice to Borrower, all indebtedness secured by this Mortgage, together with interest thereon, shall become due and payable forthwith; provided , however , that such option shall be unavailing and the Note and this Mortgage shall remain in effect in any event if Borrower lawfully may pay all such taxes, including interest and penalties thereon, to or for the Bank, and does in fact pay all of the same as and when due and payable.

          3.      Escrow Deposits . If an Event of Default occurs under and as defined in the Note, this Mortgage or any of the other documents, instruments or agreements now or hereafter evidencing or further securing the indebtedness evidenced by the Note (the Note, this Mortgage and all such other documents, instruments and agreements are sometimes collectively referred to as the “Loan Documents”), and continues beyond the applicable grace period provided for such default hereunder or thereunder, Borrower shall, at the Bank’s request, pay to the Bank monthly, on or before the first day of each month, an amount equal to one twelfth (1/12th) of the annual charges (or such other base amount reasonably determined by the Bank based on such factors as a change in the assessed value of the Mortgaged Property or a change in the applicable real estate tax rates or new special assessments) for the Impositions and the Insurance Premiums. The amounts so paid shall be security for the Impositions and the Insurance Premiums and shall be used in payment thereof, provided that Borrower is not otherwise in default hereunder. However, if pursuant to any provision of this Mortgage or the Note, the whole amount of the unpaid principal debt under the Note becomes due and payable, the Bank may apply any amount so held against the indebtedness secured hereby in such order as the Bank may determine. The Bank may from time to time waive, and after any such waiver may reinstate, the provisions of this section requiring the monthly payments prescribed herein.

          4.       Maintenance of Insurance.

          (a)      Borrower shall maintain comprehensive general public liability insurance on the Mortgaged Property, naming the Bank as an additional insured, containing a contractual liability clause reasonably acceptable to the Bank and providing coverage consistent with the requirements set forth herein. In addition, Borrower shall: (i) keep all Improvements and all Collateral reasonably insured against loss by reason of fire, casualty and such other hazards as may be specified by the Bank, for the benefit of the Bank; and (ii) during all periods in which construction is being performed on, to or at the Mortgaged Property, maintain builder’s risk coverage. All insurance required by the terms of this Mortgage shall be written in amounts, shall provide for coverage limits and terms (including,

without limitation, those which pertain to deductibles or to risk-retention) shall provide a waiver of subrogation endorsement and shall be issued by companies, all reasonably acceptable to the Bank. Failure to have in force insurance required hereunder ten (10) days after written notice from the Bank shall be a default. All proceeds payable under property and casualty coverage shall be payable to the Bank pursuant to a standard, non-contributing loss-payable provision reasonably acceptable to the Bank, and are hereby irrevocably assigned to the Bank. A certificate of each policy of insurance required by this Mortgage shall be delivered to the Bank along with proof of premiums paid for the current policy year and each subsequent year for the term of the Mortgage. The Borrower shall give the Bank prompt notice of any loss covered by any such insurance, and the Bank may join Borrower in adjusting any loss over Fifty Thousand Dollars ($50,000). Subject to the terms of Section 6, below, all sums received by the Bank in consequence of any insured casualty shall be applied either to the prepayment of the indebtedness evidenced by the Note (in such sequence as the Bank may determine) or to the reimbursement of the Borrower for the expenses incurred by it in the restoration of the Improvements. Bank shall apply the proceeds to the restoration of the Improvements if the following minimum conditions are met:

          (i)       no Event of Default shall have occurred and remain uncured (after the expiration of all notice, cure and grace periods relative thereto) at the time of such casualty and Borrower shall not have defaulted in its payment obligations at any time prior to the casualty loss, which default remains uncured after the expiration of all notice, cure and grace periods;

          (ii)       Borrower shall continue to meet all standards for advances under Bank’s customary lending practices for borrowers of similar creditworthiness given the amount of the loans and the remaining term thereunder;

          (iii)       In the event that Borrower elects to rebuild the Mortgaged Property upon such casualty loss and the foregoing requirements are satisfied, all such insurance proceeds for losses under Two Hundred Thousand Dollars ($200,000.00) in value shall be paid directly to Borrower and all proceeds for losses in excess of Two Hundred Thousand Dollars ($200,000.00) in value shall be deposited with Bank into a loan in process account in Borrower’s name for disbursement by Bank in accordance with its then standard construction loan disbursement practices; and

          (b)      Borrower shall not procure or maintain separate insurance concurrent in form or contributing in the event of loss with the coverage required to be maintained by the preceding paragraph without the express, prior, written consent of the Bank.

          (c)      In the event that Borrower shall fail to comply with the requirements imposed by this Section 4, the Bank may (but shall not be obligated to), in addition to any other rights or remedies available to it in such event, procure any insurance required hereunder and may pay the premiums therefor. Any amounts so paid, and any expenses reasonably incurred by the Bank in connection therewith, shall become immediately due and payable to the Bank by Borrower and shall be secured by this Mortgage, and in the event that such sums are not immediately repaid to Bank, shall bear interest at the Default Rate as set forth in the Note.

          5.      Condemnation . If any action shall be commenced or any written notice shall be received for the taking by exercise of the power of eminent domain of title to or the temporary use of all or any part of the Mortgaged Property, or in the event of any private sale in lieu thereof, Borrower will promptly give written notice thereof to the Bank and, upon written notice to Borrower, Bank shall be entitled to engage attorneys on behalf of Bank and Borrower to represent Bank and Borrower in such proceedings. Any and all proceeds payable from any award made in such eminent domain proceedings (or conveyance in lieu thereof) are hereby assigned to the Bank, and shall be paid to the Bank and applied, at the Bank’s reasonable option, either to the prepayment of the indebtedness secured hereby (in such order or sequence as the Bank may determine) or to the reimbursement of the Borrower for its expenses in restoring the Mortgaged Property to a condition as similar as possible to that which existed immediately prior to the occurrence of such taking.

          6.       Alterations; Fixtures . No building or other improvement on or in the Mortgaged Property shall be structurally or materially altered, removed or demolished, nor shall any fixtures or appliances on, in or about the buildings or improvements be severed, removed, sold or mortgaged, without the consent of the Bank, which shall not be unreasonably withheld, conditioned or delayed. If any of the fixtures, chattels or articles of personal property covered by this Mortgage are destroyed in whole or in part, they shall be replaced promptly by similar fixtures, chattels and articles of personal property at least equal in quality and condition to those replaced, free from any security interest in or encumbrance thereon or reservation of title thereto, except as otherwise provided in the Loan Documents.

          7.       Maintenance of the Mortgaged Property . Borrower shall (a) not commit or suffer any waste, impairment or deterioration of the Mortgaged Property or any part thereof; (b) keep and maintain the Mortgaged Property and every part thereof in good condition and repair, in compliance with all applicable requirements imposed by any Federal, state or local governmental authority (including, without limitation, those which may be imposed by or in connection with any building permit issued or to be issued with respect to the Mortgaged Property); and permit the Bank and its agents to enter upon and inspect the Mortgaged Property at any reasonable time.

          8.      Prohibition of Liens and Transfers.

          (a)      Borrower will not voluntarily create or permit to be created or filed against the Mortgaged Property any mortgage lien or other lien or security interest inferior or superior to the lien and security interest created by this Mortgage except for taxes not yet due and payable. Borrower will keep and maintain the Mortgaged Property free from the liens and claims of all persons supplying labor or materials to the Mortgaged Property. If any lien, claim or notice for any mechanics’ or other statutory lien shall be filed with respect to the Mortgaged Property, Borrower shall promptly so notify the Bank and shall, within thirty (30) days after the date of any such filing, cause the same to be released, discharged or satisfied, by bonding or otherwise. If Bank consents to the creation of any voluntary lien inferior to the lien of this Mortgage, any default in the performance or observance of the terms and conditions contained in the instrument creating such lien shall be a default hereunder.

          (b)      Except for sales of any of the property set forth in Exhibit A and the payment of the release prices as more fully set forth in the Note, Borrower shall not without Bank’s prior written consent, directly or indirectly, by operation of law or otherwise: (i) sell, transfer, convey, ground-lease, assign or pledge all or any portion of the Mortgaged Property, or any interest therein, except for leases made in the ordinary course of business (all of which current leases are approved by Bank) or replacement leases to those currently in place under substantially similar or better economic terms; or (ii) permit or suffer any change in the identity or control of Borrower (whether by sale or transfer of any ownership interest, however characterized, or by other means). A sale, transfer, conveyance or assignment means the conveyance by the Borrower of any legal or equitable right, title or interest in the Mortgaged Property, or any part thereof, whether such conveyance is voluntary or involuntary, by outright sale, deed, installment sale contract, land contract, lease, option contract, or any other method of transferring any interest in real property. Any change in the entities holding the legal or beneficial ownership of the ownership interests of Borrower to an entity not managed and controlled by Borrower shall be considered to be a sale or transfer within the meaning of this Section 9(b) and shall not be made without the Bank’s prior written consent; provided, however, that transfers of limited partnership interests in Borrower, and/or transfers of interests in Borrower, or the general partners of Borrower, by J. D. Nichols or Brian F. Lavin to family members or family trusts or limited liability companies for estate planning purposes, or to employees of NTS Development Company, shall not be considered a sale or transfer under this Section 9(b).

          (c)      Borrower’s breach of any of its obligations under this Section 8 shall constitute an immediate Event of Default hereunder, and shall entitle the Bank to exercise any one or more, or all, of the rights and remedies available to it in such event.

          9.      Indemnity: Costs of Defense . Borrower shall indemnify and save the Bank harmless from all actual losses, reasonable out-of-pocket costs and expenses incurred by or asserted against the Bank by reason of any action, suit, proceeding, hearing, motion or application before any court or administrative body (excepting an action to foreclose the lien of this Mortgage against the Mortgaged Property or to collect the debt secured hereby) with respect to which (a) a proof of claim is required to be filed; or (b) it becomes necessary to defend or uphold the terms of this Mortgage. All money paid or expended by the Bank in that regard, together with interest thereon from date of such payment at the Default Rate under the Note, shall be so much additional indebtedness secured hereby and shall be immediately and without notice due and payable to the Bank.

          10.      Compliance with Requirements . Borrower will at all times promptly and faithfully keep and perform, or cause to be kept and performed, all covenants and conditions contained in any easement agreements, party wall agreements, deeds or other instruments, which in any way affect the Mortgaged Property and which are to be kept and performed by Borrower. Borrower will not do or permit anything to be done under such instruments, the doing of which, or refrain from doing anything, the omission of which, will impair or tend to impair the security of this Mortgage.

          11.      Security Agreement . This Mortgage is a security agreement for the purpose of creating a security interest in and to all of the Collateral securing the Obligations. Borrower authorizes the Bank to file, in the jurisdiction where this Mortgage will be given effect, financing statements covering the Collateral without the necessity of obtaining Borrower’s signature pursuant to the Uniform Commercial Code in a form reasonably satisfactory to the Bank, and will pay the reasonable out-of-pocket cost of filing the same or filing or recording this instrument, as a financing statement, in all public offices at any time and from time to time wherever the Bank deems filing or recording of any financing statements or of this instrument to be desirable or necessary. Within five (5) business days upon request by mail, Borrower shall execute, acknowledge and deliver to the Bank a security agreement or other similar instrument in form prepared by Bank and reasonably satisfactory to Borrower covering all property, of any kind whatsoever owned by any Borrower, which, in the sole but reasonable opinion of the Bank is essential to the operation of the Mortgaged Property and concerning which there may be any doubt as to its being subject to the lien of this Mortgage under the laws of the Commonwealth of Kentucky. Borrower shall further execute, acknowledge and deliver any financing statement, affidavit, continuation statement or certificate or other document as the Bank may request in order to protect, preserve, maintain, continue and extend the security interest under and the priority of such security agreement or other instrument. Borrower agrees to pay to the Bank, on demand, all reasonable out-of-pocket costs and expenses incurred by the Bank in connection with the preparation, execution, recording and filing of any such documents.

          12.      Restriction Against Granting Further Security Interest . Borrower shall not, without the prior written consent of Bank, create or suffer to be created pursuant to the Uniform Commercial Code any other security interest in the Mortgaged Property and/or

Collateral (or any portion thereof) including replacements and additions thereto, except as permitted hereunder or under the other Loan Documents.

          13.      Remedies . Upon Borrower’s breach of any covenant or agreement of Borrower contained in this Mortgage, including the covenant to pay when due all sums secured by this Mortgage and after notice and expiration of any applicable cure period, Bank shall have the remedies of a secured party under the Uniform Commercial Code and, at Bank’s option may also invoke all other remedies as provided herein. In exercising any of said remedies, Bank may proceed against the items of real property and any items of personal property specified herein as part of the Mortgaged Property separately or together and in any order whatsoever, without in any way affecting the availability of Bank’s remedies under the Uniform Commercial Code or any of the other remedies provided herein.

          14.      Financial Reporting Requirements . Borrower will furnish the following financial reports and information to the Bank:

          (a)      As soon as available (and in any event within one hundred twenty (120) days after the end of Borrower’s fiscal years), a complete copy of Borrower’s annual financial statements for that year, which shall be (1) prepared on a comparative basis with the prior year, in accordance with generally recognized accounting principles (except as disclosed therein) and in form and detail reasonably satisfactory to the Bank; and (2) certified (without qualification as to generally recognized accounting principles) by Borrower’s chief financial officer, Bank hereby acknowledging that the form of financial statements previously delivered to Bank is acceptable; and

          (b)      forthwith upon the Bank’s written request, such other information concerning Borrower’s financial condition, properties and operations as the Bank may from time to time reasonably request.

          15.         Events of Default . The occurrence of any one or more of the following events shall be an “Event of Default” hereunder:

          (a)      The failure by Borrower to make any payment of principal or interest as and when such payment is due and payable under the Note, which failure shall continue beyond the expiration of any period of grace applicable to such payment under the Note;

          (b)      If any of Borrower’s representations or warranties hereunder shall prove to be knowingly untrue or incomplete in any material fashion when made;

          (c)      If Borrower shall fail to pay any Impositions or Insurance Premiums in accordance with Section 2, or to maintain any of the insurance required by the provisions of Section 4, or if Borrower shall violate any of the restrictions contained in Section 8 after the expiration of all written notice and cure periods provided in the Loan Documents;

          (d)      An encumbrance on or sale of the Mortgaged Property, or any part thereof, in violation of Section 8 herein;

          (e)      The filing of any lien or charge against the Mortgaged Property or any part thereof which is not removed or bonded to the satisfaction of Bank within a period of thirty (30) days thereafter;

          (f)      The failure to observe or perform any one or more of the other terms, covenants or other obligations on the part of Borrower set forth in the Note, this Mortgage, or the Loan Documents and such default is not fully cured within thirty (30) d