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UNDERSIGNED IS HEREBY GRANTED TO THE PAYEE AND
ITS ASSIGNEE OR PLEDGEE FOR ANY ASSIGNMENT OR
PLEDGE.
All of the investor notes were endorsed by Dakotah
Hills “PAY TO THE ORDER OF NORTHERN TELECOM INTERNATIONAL
FINANCE B.V.” and were delivered to Northern Telecom along
with an assignment to Northern Telecom of the partnership’s
interest in the security agreements that had been executed
by the limited partners.
As contemplated by the private offering memorandum and
the letter issued by each limited partner to Northern
Telecom, Dakotah Hills purchased a financial guaranty bond
from Admiral Insurance Co. (Admiral). The guaranty bond
provided that in the event any limited partner defaulted on
his or her obligations under the investor note, Admiral
agreed to pay to Northern Telecom the amount due under the
investor note. Under the terms of the financial guaranty
bond, after Northern Telecom received payment of the
principal amount payable under a defaulted investor note,
it was required to deliver the investor note and the
investor’s security agreement to Admiral.
Dakotah Hills also entered into a partnership
indemnity agreement with Admiral under which Dakotah Hills
agreed to indemnify Admiral against any loss on the
financial guaranty bond. The partnership’s obligation
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Last modified: May 25, 2011