Caracal Gold Regulatory News (GCAT)

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.

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

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.