Aim-listed Caracal Gold has raised $1-million through the issue of secured convertible loan notes to Orca Capital and the proceeds have been drawn down.

Caracal has granted the subscriber an option to subscribe for up to a further $4-million of loan notes.

Net proceeds will be used to fund general corporate requirements and the company’s working capital.

The company’s obligations in respect of the loan notes shall be secured by a share pledge granted by Caracal Holdings over Kilimapesa Gold, the 100%-owned Kenyan operating subsidiary of Caracal.

In addition, the outstanding sums of the existing loan notes owed to the subscriber will also benefit from the security. The security will be released upon the approval of a prospectus by the Financial Conduct Authority.

“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 [project] 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, the Mill End settlement progress and a summary of the capital and debt position of Caracal,” comments Caracal CEO Robbie McCrae.

Discussions with Philoro Global Trading are said to be progressing well and Philoro confirmed its 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.

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

Further, Caracal chairperson-designate Simon Grant Rennick is seeking to reach a settlement with Mill End for the full repayment of the Mill End facility.

Caracal is an expanding East Africa-focused gold producer. The company is progressing a mine optimisation strategy at its 100%-owned Kilimapesa gold mine in Kenya; and, alongside this, is undertaking a targeted exploration programme at the Nyakafuru project, in Tanzania.