Kavango Resources plc has secured strategic financing of £10,277,868 comprising a placing and convertible loan notes.
LISTING
The placing of 938,028,569 new ordinary shares of £0.001 each at 0.7 pence per share will raise £6,566,200, subject to a Financial Conduct Authority approved prospectus and shareholders.
The company’s deputy chairman Peter Wynter Bee has additionally agreed to advance £1 million for one of the CLNs.
Kavango’s major shareholder Purebond has advanced £511,668 for the second CLNs.
The CLNs carry an annual coupon of 10% and have a twelve-month term.
The CLNs and accrued interest are convertible into ordinary shares in the company subject to publication of a prospectus.
Kavango said it had drafted a prospectus which is currently under review by the FCA.
The company intends to convert the principal of the CLNs into 215,952,571 new ordinary shares at a price of 0.7p per share on publication of the prospectus.
Outstanding convertible loans from August and September will also then be converted on the same terms.
The principal of the outstanding CLNs is £2.2m and expected to convert into 314,285,714 new ordinary shares.
Kavango will use the published prospectus as the listing document for application to trading on the Victoria Falls Stock Exchange.
Proceeds will go towards developing gold mines at Hillside in Zimbabwe, further exploration in the country and Botswana, and general working capital.