RCS - BodySmart Finance - Notice to Noteholders

SoftBankAnnouncement

10/06/2024 09:15

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RNS Number : 7729R  BodySmart Finance Ltd  10 June 2024

THIS NOTICE CONTAINS IMPORTANT INFORMATION THAT IS OF INTEREST TO THE
REGISTERED AND BENEFICIAL OWNERS OF THE SUBJECT SECURITIES. IF APPLICABLE, ALL
DEPOSITORIES, CUSTODIANS AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE
REQUESTED TO EXPEDITE THE RE-TRANSMITTAL TO BENEFICIAL OWNERS OF THE
SECURITIES IN A TIMELY MANNER.  IF NOTEHOLDERS ARE IN ANY DOUBT AS TO THE
ACTION THEY SHOULD TAKE, IF ANY, THEY SHOULD IMMEDIATELY CONSULT THEIR OWN
INDEPENDENT PROFESSIONAL ADVISERS AUTHORISED UNDER THE FINANCIAL SERVICES AND
MARKETS ACT 2000 (IF THEY ARE IN THE UNITED KINGDOM) OR ANOTHER APPROPRIATELY
AUTHORISED INDEPENDENT FINANCIAL ADVISER AND TAKE SUCH OTHER ADVICE FROM THEIR
OWN PROFESSIONAL, TAX AND LEGAL ADVISERS AS THEY DEEM NECESSARY.

 

10 June 2024

NOTICE TO NOTEHOLDERS

BODYSMART FINANCE LIMITED

(Incorporated in Bailiwick of Jersey with registered number 131386)

 

to the holders of those of the Series 2020-B1 notes issued by the Issuer on 3
June 2020 with

ISIN: GB00BMQ56V55

(the "Noteholders" and the "Notes", respectively)

 

Unless otherwise defined in this Notice, capitalised terms used in this Notice
shall have the meanings ascribed to them in the Trust Deed dated 3 June 2020
(as supplemented, restated or amended from time to time) between the Issuer
and Note Trustee (the "Trust Deed").

Event of Default under the Loan Agreement

The Issuer hereby notifies the Noteholders that BodySmart Investment Group LLC
(the "Borrower") has failed to pay interest due up to and including 3 June
2024 to the Issuer (as lender) in an amount of US$278,200.15 pursuant to the
terms of the Loan Agreement and that this constitutes an Event of Default
under Condition 13(h) of the Notes.

Potential Event of Default under the Notes

The Issuer further notifies the Noteholders that, without payment of interest
from the Borrower to the Issuer pursuant to the terms of the Loan Agreement,
the Issuer was unable to pay its coupon due on the Interest Payment Date
falling on 3 June 2024 in an amount of US$278,200.15 and that this constitutes
a Potential Event of Default under the Notes.  Should the Issuer remain
unable to pay the coupon referenced above for a period of 14 days from 3 June
2024 a further Event of Default will arise under Condition 13(a) of the
Notes.

Trustee Notification

In accordance with the terms of the Trust Deed, the Issuer has notified the
Note Trustee of the occurrence of the circumstances set out in this
announcement.

Continuing Events of Default under the Loan Agreement

The Issuer re-confirms to Noteholders that BodySmart Investment Group LLC (the
"Borrower") continues to have failed to pay:

(a) interest due up to and including 3 December 2023 to the Issuer (as lender)
in an amount of US$278,200.15; and

 

(b)  the fees set out in the Fee Letter (as defined in the Loan Agreement)
dated 5 February 2024 and due to be paid by the Borrower on 5 April 2024 in an
amount of GB£13,225.24 (being US$16,795.68 as at 5 April 2024),

in each case pursuant to the terms of the Loan Agreement and that these
failures by the Borrower to pay interest and fees constitute Events of Default
under the terms of the Loan Agreement and consequently constitute Events of
Default under Condition 13(h) of the Notes.  The Issuer hereby confirms to
Noteholders that all of the above Events of Default are continuing at the date
hereof.

Continuing Event of Default under the Notes

The Issuer re-confirms to Noteholders that without payment of interest from
the Borrower to the Issuer pursuant to the terms of the Loan Agreement, the
Issuer remains unable to pay its coupon due on the Interest Payment Date
falling on 3 December 2023 in an amount of US$278,200.15 and that this
constitutes an Event of Default under Condition 13(a) of the Notes. The Issuer
hereby confirms to Noteholders that the above Event of Default is continuing
at the date hereof.

Right to direct the Note Trustee

As previously communicated to Noteholders, pursuant to Condition 13 (Events of
Default), if an Event of Default has occurred and is continuing, the Note
Trustee at its discretion may, and if so requested in writing by the holders
of at least one-quarter of the aggregate principal amount of the Notes then
outstanding or if so directed by an Extraordinary Resolution of the
Noteholders shall (subject to the Note Trustee having been indemnified and/or
secured and/or prefunded to its satisfaction), give written notice to the
Issuer (an "Acceleration Notice") declaring the Notes to be immediately due
and payable, whereupon they shall become immediately due and payable at their
Early Redemption Amount together with accrued interest without further action
or formality.

The Security shall become enforceable upon the service of an Acceleration
Notice by the Note Trustee on the Issuer.

Pursuant to Condition 18 (Enforcement), the Note Trustee may at any time at
its discretion and without notice, take such action under or in connection
with any of the Transaction Documents or the Notes or the Coupons as it may
think fit (including, without limitation, directing the Security Trustee to
take any action under or in connection with any of the Transaction Documents
or, at any time after the security has become enforceable, to take steps to
enforce the Security). The Note Trustee shall not be bound to take any such
action unless (i) it shall have been directed by an Extraordinary Resolution
of Noteholders or so requested in writing by the holders of at least
one-quarter in principal amount of the Notes then outstanding and (ii) it
shall have been indemnified and/or secured and/or prefunded to its
satisfaction. The Security Trustee shall not, and shall not be bound to, take
any such action unless (i) instructed by the Note Trustee and (ii) it shall
have been indemnified and/or secured and/or prefunded to its satisfaction.

No Further Action by Note Trustee

As previously communicated to Noteholders, for the avoidance of doubt (but
without prejudice to the exercise of any discretion, power or authority which
the Note Trustee is required, expressly or impliedly, to exercise in or by
reference to the interests of the Noteholders under the Trust Deed), the Note
Trustee will not take any further action without the request or direction
(including indemnification) of the holders as described above.

Borrower proposal to amend terms

The Issuer reminds the Noteholders that on 8 March 2024 the Issuer and Note
Trustee received from the Borrower a proposal to amend the terms of the Loan
Agreement and the Notes (the "Proposal"), as set out in the Issuer's
announcement of 8 March 2024 which can be found here
(https://www.londonstockexchange.com/news-article/market-news/notice-to-noteholders-proposal-to-amend-terms/16369665)
.

As previously communicated to Noteholders, neither the Issuer nor the Note
Trustee make any recommendations and give no legal or investment advice in
respect of the Proposal or as to the Notes generally.

Noteholders should take and rely on their own independent legal and financial
advice and may not rely on advice or information provided to the Note Trustee,
statements as to the legal position included in notices issued by the Issuer
or the Note Trustee relating to the Notes or otherwise or the views of the
Issuer or the Note Trustee expressed herein or otherwise.

Noteholders should note that the Proposal relates to the Notes only.

Information regarding the Events of Default and Proposal

Queries regarding the circumstances surrounding the Events of Default or
regarding the Proposal may be addressed to the Calculation Agent:

ZigZag Management Experts LLC

Unit No:423 DMCC Business Centre

Level No 5 Jewellery & Gemplex 2

Dubai

United Arab Emirates
info@zigzag-me.com (mailto:info@zigzag-me.com)

Ref: 2020-B1

Outstanding Fees, Indemnification and Pre-Funding of the Note Trustee

In dealing with the Events of Default outlined in this announcement (and
various matters related thereto) the Issuer and the Note Trustee have incurred
significant fees and expenses the vast majority of which have not been paid or
repaid by the Borrower as required pursuant to the terms of the Loan
Agreement.  Accordingly, the Issuer (in its capacity as Lender under the Loan
Agreement) has served on the Borrower a further Fee Letter dated 31 May 2024
(the "Fee Letter") in respect of all such outstanding fees which are payable
by the Borrower pursuant to the terms of the Loan Agreement. The Borrower is
obliged to pay all such fees before 8 June 2o24 and if the Borrower fails to
pay all such fees, a further Event of Default may occur.

Unless and until the fees set out in the Fee Letter have been paid, the Issuer
and the Note Trustee are not in a position to carry out further work in
relation to the Proposal (and its approval and implementation).

Further, pursuant to its rights under the Trust Deed, the Note Trustee has
requested that the Borrower provide it with an indemnity and pre-funding in
respect of the fees expected to be incurred by the Note Trustee in relation to
the Proposal (and its approval and implementation), but the Borrower has to
date failed to provide the Note Trustee with any indemnification or
pre-funding.

THE ISSUER AND THE NOTE TRUSTEE HEREBY NOTIFIY NOTEHOLDERS THAT UNLESS AND
UNTIL:

(A)         THE BORROWER INDEMNIFIES AND PRE-FUNDS THE NOTE TRUSTEE TO
ITS SATISFACTION; AND

 

(B)         THE BORROWER PAYS ALL OUTSTANDING FEES AND EXPENSES DUE TO
THE ISSUER AS DETAILED IN THE FEE LETTER,

NEITHER THE NOTE TRUSTEE NOR THE ISSUER WILL CARRY OUT FURTHER WORK IN
RELATION TO THE PROPOSAL (OR ITS APPROVAL AND IMPLEMENTATION).

NOTWITHSTANDING THE FOREGOING, THE NOTE TRUSTEE WILL, SUBJECT TO THE TERMS OF
THE TRUST DEED, TAKE ANY ACTION THAT IT IS INSTRUCTED TO TAKE BY THE
NOTEHOLDERS VIA A DULY PASSED RESOLUTION OR EXTRAORDINARY RESOLUTION PROVIDED
THAT THE NOTEHOLDERS SO INSTRUCTING THE NOTE TRUSTEE PROVIDE IT WITH AN
INDEMNITY AND PRE-FUNDING TO ITS SATISFACTION IN RESPECT OF ALL SUCH ACTIONS.

Noteholder Contact

In order to facilitate communications with Noteholders, Noteholders should
make themselves known to the Note Trustee by contacting it by e-mail using the
contact details below.  Any such communication should make reference to the
Issuer and disclose the identity of the Noteholder, the aggregate nominal
amount of Notes held by the Noteholder and the details of the person(s) who
shall represent the Noteholder.

All Noteholders must verify their holdings when contacting the Note Trustee by
providing proof of holding (with a supporting custodian letter (if
applicable)), in each case disclosing the information set out above.

Persons who hold the Notes beneficially through CREST may also disclose their
identity to the Note Trustee in accordance with the above paragraph.  The
Note Trustee will require the Notes of any Noteholder that gives any direction
to the Note Trustee to be blocked in CREST.  Further instructions will be
provided in connection with this process on request.

The Note Trustee will require the Notes of any Noteholder that gives any
direction to the Note Trustee to be blocked in CREST.  Further instructions
will be provided in connection with the enforcement process on request.

Correspondence to the Note Trustee regarding enforcement should be addressed
to security@woodsidesecretaries.co.uk
(mailto:security@woodsidesecretaries.co.uk) with the ISIN of the Notes and
"Bodysmart Finance Limited" in the subject line of the email.

 

This notice is given by the Issuer.

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