REG - Caracal Gold PLC - Additional Financing Secured & Corporate Update

Caracal GoldAnnouncement

16/02/2023 07:00

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RNS Number : 0698Q  Caracal Gold PLC  16 February 2023

16 February 2023

 

Caracal Gold PLC

('Caracal' or the 'Company')

Additional Financing Secured & Corporate Update

Caracal Gold PLC, the expanding East African gold producer with over
1,300,000oz JORC compliant gold resources, is pleased to announce that it has
raised US$1 million via the issue of secured Convertible Loan Notes ('the Loan
Notes') to Orca Capital GmbH ('the Subscriber') and the proceeds have been
drawn down. The Company has granted the Subscriber an option to subscribe for
up to a further US$4 million of Loan Notes.

Highlights

·     US$1 million drawn down following the issue of the Loan Notes of
denomination US$1 each due 31 January 2027 and accruing interest at a rate of
8% per annum.

·    The Subscriber has the right, but not the obligation, to subscribe for
up to a further US$4 million of Loan Notes. Net proceeds shall be used to fund
general corporate requirements and the Company's working capital.

·     Philoro Global Trading AG has confirmed their ongoing support for
Caracal and Kilimapesa.

·   The Company has engaged legal counsel to undertake the comprehensive
review of the corporate governance, regulatory compliance, and communications
policies to strengthen internal procedures.

Convertible Loan Note Terms

The first tranche of US$1 million of Loan Notes has been drawn down. The
Subscriber has the right, but not the obligation, to subscribe for up to a
further US$4 million of Loan Notes which will be conditional upon the approval
of a prospectus by the Financial Conduct Authority ("FCA") and subsequent
ability and authority of the Company to issue shares and must take place
before the long stop date, being 30 June 2023.

The Loan Notes are convertible into new Ordinary Shares at a price of 90% of
the 10-day VWAP of an ordinary share prior to the business day, on which the
noteholder serves the Conversion notice on the Company, following the approval
of a prospectus by the FCA and subsequent ability and authority of the Company
to issue shares, providing the issue of the Ordinary Shares does not trigger a
Rule 9 offer for the Company pursuant to the Takeover Code.

The Company's obligations in respect of the Loan Notes shall be secured by a
share pledge granted by the Company's subsidiary Caracal Holdings Ltd over
Kilimapesa Gold Pty Ltd, the 100%-owned Kenyan operating subsidiary of Caracal
(the "Security"). In addition, the outstanding sums of the existing loan notes
owed to the Subscriber (which were mentioned in the companies audited
financials for the period ending June 2022 and are summarised below) will also
benefit from the Security. The Security will be released upon the approval of
a prospectus by the FCA.

Existing note summary: "On 22 March 2022, the Company entered into a
Convertible Loan Note Instrument with ORCA Capital GmbH ("ORCA"), a company
incorporated and registered in Germany, for £2 million at an interest rate of
8% per annum. The conversion price being agreed as £0.06 per Ordinary share,
save that where the price per ordinary share falls below £0.06, the
conversion price shall be 90% of the 10-day VWAP of an ordinary share. 266
million warrants were also issued to Koenig, at an exercise price of £0.0085
and are exercisable for 2 years from the date of grant."

 

Philoro Global Trading AG ("Philoro")

Discussions with Philoro Global Trading AG are progressing well and Philoro
confirmed their ongoing support for Caracal and Kilimapesa. An agreement is
expected in due course, which will provide short term funding as well as
extend the existing financing announced in December 2022.

Corporate Governance Update

Legal counsel has been engaged to conduct a comprehensive review of its
corporate governance, regulatory compliance, and communications policies to
strengthen internal procedures.

Mill End

Chairman designate Simon Grant Rennick is seeking to reach a settlement with
Mill End for the full repayment of the Mill End facility.

Robbie McCrae, CEO of Caracal commented, "We are very pleased to see the
continuous support and trust from Orca Capital. This additional financing is a
vote of confidence in the Company as we seek to restructure our financing
arrangements.

 

We have received significant interest in financing the Kilimapesa and I am
pleased that discussions in this regard are going well. We expect to provide a
comprehensive update which will include an update on Philoro, Mill End
settlement progress and summary of the capital and debt position of Caracal.

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed
in accordance with the Company's obligations under Article 17 of MAR.

 

* * ENDS * *

For further information visit www.caracalgold.com or contact the following:

 

 Caracal Gold plc                                    info@caracalgold.com (mailto:info@caracalgold.com)

 Robbie McCrae
 Clear Capital Markets Ltd                           +44 203 897 0981

 Joint Broker                                        +44 203 869 6086

 Keith Swann / Jonathan Critchley
 VSA Capital Ltd                                     +44 203 005 5000

 Financial Adviser and Joint Broker

 Andrew Raca (Corporate Finance)

 DGWA, the German Institute for Asset and            info@dgwa.org (mailto:info@dgwa.org)

 Equity Allocation and Valuation

 European Investor and Corporate Relations Advisor

 Katharina Löckinger

 

Notes

Caracal Gold plc is an expanding East African focused gold producer with a
clear path to grow production and resources both organically and through
strategic acquisitions. Its aim is to rapidly increase production to
+50,000ozs p.a. and build a JORC compliant resource base of +3Moz.  The
company is progressing a well-defined mine optimisation strategy at its 100%
owned Kilimapesa Gold Mine in Kenya, where there is significant mid-term
expansion potential and the ability to increase gold production to 24,000oz
p.a. and the resource to +2Moz (current JORC compliant resources of approx.
706,000oz). Alongside this, Caracal is undertaking a targeted exploration
programme at the Nyakafuru Project in Tanzania, which has an established
high-grade shallow gold resource of 658,751oz at 2.08g/t contained within four
deposits over 280 km2 and appears amenable to development as a large scale
conventional open pit operation.

 

Caracal's experienced team has a proven track record in successfully
developing and operating mining projects throughout Africa.  The Company is a
responsible mining and exploration company and supports the positive social
and economic change that it contributes to the communities in the regions that
it operates.  It is a proudly East African-focused company: it buys locally,
employs locally, and protects the environment and its employees and their
families' health, safety, and wellbeing.

 

Caracal's shares are quoted on the Main Market of the London Stock Exchange
(LON: GCAT) and on the Frankfurt Stock Exchange (FSE: 6IK).  The Company is
also in the process of listing on the Nairobi Securities Exchange.

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