Hague negotiates standstill agreement for $1.5 million debentures

By Devika Patel

Knoxville, Tenn., June 9 - Hague Corp. negotiated a standstill agreement with its lenders on June 2, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

MKM Opportunity Master Fund, Ltd., MKM SP1, LLC and Steven Posner Irrevocable Trust, the holders of the company's $1.5 million of 8% convertible debentures, agreed to a 120-day standstill period, beginning on June 1, under which the investors agreed not to pursue any of their rights regarding subsidiary Solterra's planned $400,000 private bridge financing and its planned $6 million private placement.

If Solterra cannot raise at least $2 million by the end of the standstill period, then the investors' existing rights go back into effect.

If the private placement raises at least $2 million, the investors will have the right to move the notes down to Solterra and convert the notes and accrued interest into Solterra common stock at a 25% discount to the private placement share price. They will also receive a proportional number of warrants or other securities sold in the private placement, if any, at a similar discount.

The debentures were sold in a November private placement.

Hague is based in Scottsdale, Ariz.

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