Financing, Business Development & Director Changes

(Registration Number: 9306219)

Share code on AIM: KAT

ISIN: GB00BSNBL022

('Katoro' or 'the Company')

Dated: 12 February 2024

Katoro Gold PLC ('Katoro' or the 'Company')

Financing, Business Developments & Director Changes

Issue of Equity & TVR

Katoro Gold PLC (AIM: KAT), the strategic and precious minerals exploration and development company, announces a financing, business development matters and director changes.

HIGHLIGHTS:

§ Financing by way of a Broker-led placing and subscription (the "Financing") with new and existing Shareholders to support business development raising £750,000 through the issue of 750 million shares at 0.1p (the "Financing Shares").

§ Board changes, details to be announced, to consider ways to maximise value from existing interests and to secure new cost-effective opportunities globally, with a focus on critical metals including uranium.

§ Appointment of strategic consultant, Paul Johnson, former CEO of Power Metal Resources plc and Metal Tiger plc, to assist the Board with a reinvigoration of the business model, business operations, strategic direction and enhanced communications with investors.

§ Plan to change the name of the Company to Katoro Global Resources plc (stock code KAT to remain unchanged).

Louis Coetzee, current Chairman of Katoro Gold plc commented: "We have for some time been working to find a pathway to reinvigorate the Company. I believe the proposals announced today, with the refreshed board, advisory support and new approach, has the potential to deliver considerable value for shareholders.

Following the Financing, the Company will have a market capitalisation on the very low end of UK listed junior resource companies. This is a low foundation from which we believe a refreshed and energetic business strategy can be built, delivering value to shareholders, which is critically important.

The board are incentivised through shareholdings and options to deliver for investors and to ensure the focus is on delivery through share price appreciation.

There will be further updates to follow in the near term."

FURTHER INFORMATION

Financing

The Company has raised £750,000 through the placing and subscription arranged by SI Capital Ltd of 750 million new KAT ordinary shares of 0.1p ("Ordinary Shares") at an issue price of 0.1p per share (the "Financing Shares").

Each Financing Share will have an attaching warrant to subscribe for a further KAT new ordinary share at an exercise price of 0.2p per KAT share, with a life to expiry of 3 years from today's date (in total 750 million "Financing Warrants").

Should the volume weighted average price ("VWAP") of KAT meet or exceed 0.5p for 5 trading days, KAT will have the right but not the obligation to issue warrant holders with ten business days' notice to exercise some or all of their remaining Financing Warrants (the "Acceleration"). To be clear, this means KAT may choose to effect the Acceleration in stages.

The Financing is conditional only on Admission to trading on AIM, which as set out below is expected to become effective on 16 February 2024.

In total, should all the Financing Warrants be exercised, this would raise an additional £1,500,000 for the Company.

Board Changes

Louis Coetzee, current Executive Chairman will step down from the Board, and from employment with the Company, with effect from the appointment of two new directors, following appropriate market (including AIM) due diligence.  Mr Coetzee will remain as a consultant to the Company after his resignation to assist with transitional administration, including project management, financial accounting and audit matters, for the period ending 31 July 2024. 

It is expected that the two new directors will assume the roles of Non-executive Chair and Chief Executive Officer. Further information in this regard to follow in due course.

Louis Scheepers and Lukas Marthinus (Tinus) Maree have agreed to continue to serve as Non-executive Directors with the Company for a minimum of 6 months from today's date.

Board Financial Matters

Settlement of Board Fees

To date the creditors of the Company include an amount of £91,000 in respect of outstanding Board fees from current Directors for the period April 2023 to January 2024, inclusive.

This amount has been reduced with the agreement of the Board directors to £63,617.88, of which £42,411.92 will be settled in full through the issue of 42,411,920 Ordinary Shares ("Board Shares") at the same issue price as the Financing Shares of 0.1p per share. For clarity the Board Directors will not receive any warrants with this settlement of Board fees.

In respect of the Board Shares 21,205,960 are to be issued in respect of Louis Coetzee Board fees (£21,205.96) and 21,205,960 are to be issued in respect of Tinus Maree £21,205.96)) and will be subject to a hard lock-in for 12 months from today's date (with no sale of stock allowed unless approved by the new Board after the appointment of two new directors).

The issue of the Board Shares and Service Shares, as detailed below, are related party transactions under the AIM Rules (the "Transaction") and accordingly, Louis Scheepers, a Non-executive Director of the Company and the director independent of this Transaction, having consulted with the Company's nominated adviser, Beaumont Cornish Limited, considers the terms of the Transaction to be fair and reasonable insofar as shareholders are concerned.

Lock-in of Existing Director Holdings

All current Directors of the Company have committed to a "hard" lock-in of their current (pre-Financing) shareholding in the Company whilst serving as Directors or for a minimum period of 12 months, whichever is the shorter (with no sale of shares allowed unless approved by the new Board after the appointment of two new directors save in the usual exceptional circumstances).

The shareholdings of the Directors of the Company before and after the Financing and issue of Financing, Board and Service Shares (see below) is as follows:

The directors and management of the Company shown in the above tables are Persons Discharging Managerial Responsibility ('PDMRs') under the Market Abuse Regulation 2016 ('MAR'). In compliance with MAR and the Company's Share Dealing Code, the PDMR's have submitted dealing request forms to the designated Company executives to seek permission in respect of this transaction has been granted. Dealing notification forms will be completed by the PDMRs and submitted to the FCA within three (3) days of completion of the Fundraise in accordance with MAR.  See PDMR Notification section below for further information.

Issue of Shares to Kibo Energy plc

Alongside the Financing the Company has settled invoices amounting to £38,305.00 due to Kibo Energy plc through the issue of 38,305,000 Ordinary Shares ("Service Shares") at the same issue price as the Financing Shares of 0.1p per share.  The services related to administrative support provided to Katoro by Kibo Energy plc. For clarity no warrants will be issued with this settlement.

50% of the Service Shares will be subject to a "hard" lock-in for 6 months from today's date and 50% for 12 months (with no sale of stock allowed unless approved by the new Board after the appointment of two new directors).

However, 50% of the Service Shares will become freely tradable should the Company's VWAP meet or exceed 0.5p per share for 5 consecutive trading days and a further 50% of the Service Shares will become freely tradable should the Company's VWAP meet or exceed 0.75p per share for 5 consecutive trading days. Following issue of the Service Shares Kibo Energy plc will hold 134,443,738 Ordinary Shares representing 8.96% of the Company's enlarged issued share capital.

Kibo Energy plc Existing Share Lock-in

Kibo Energy plc ("Kibo") (LON:KIBO) hold 96,138,738 KAT shares on which Kibo have committed to a hard lock-in of their current shareholding in the Company for a minimum period of 12 months (with no sale of stock allowed unless approved by the new Board after the appointment of two new directors). 50% of Kibo's shareholding will become freely tradable should the Company's VWAP meet or exceed 0.5p per share for 5 consecutive trading days and a further 50% of Kibo's shareholding will become freely tradable should the Company's VWAP meet or exceed 0.75p per share for 5 consecutive trading days.

Non-Board Option Pool

In order to support the retention of key non-Board team members the Company has created a pool of 25 million options to acquire new Ordinary Shares on the same terms as the Financing Warrants, including an exercise price  of 0.2p and a 3-year life to expiry.  These options will be allocated to members of the team following appointment of the new Board ("Team Options").

For clarity no existing Board members will receive any Team Options.

Refreshed Drive, Strategy and Operations

As detailed below in the "Review of Existing Interests" and "New Opportunities" sections the focus of the Company is to deliver material upside to shareholders from those interests already held and by positioning the Company in new opportunities capable of delivering value.

The junior resource sector has experienced a prolonged downturn with junior resource companies facing considerable challenges.  In this environment, new opportunities remain available, albeit that availability is expected to reduce as the sector recovers.

For this reason it is important that the Company acts in an efficient and expeditious manner in its forward activities. 

It is also recognised that significant effort is deployed in the reliable and timely communication of business activities through regulatory news announcements and related media.

Review of Existing Interests

The Company will undertake a review of existing project interests to determine the optimal strategy for each interest, details of which will be announced to the market on material developments.

New Opportunities

Whilst the Company will remain and operate as a junior resource exploration and development company, going forward the Company will seek additional opportunities to broaden its portfolio of interests in Africa, North America and Australia.

To reflect this the Company plans to change its business name to Katoro Global Resources, and further information in this regard will follow in due course.  The Company's stock market code will remain "KAT".

The Company now has access to a deep resource of technical advisory support and potential new project pipeline including ground available through staking, joint venture opportunities and acquisition opportunities.

Target projects are available and may be secured in a wide range of commodities, however a particular focus will be on critical metal opportunities, including uranium.

Advisory Support

Value Generation Limited ("VGL") has been appointed as an advisor to the Company to assist with business recovery and support the Company in the areas of strategy, operational planning, communications and business administration.  Paul Johnson of VGL, former CEO of Metal Tiger plc and Power Metal Resources plc, will be the Chief Consultant, for this advisory work.

In accordance with the advisory agreement VGL has received 25 million warrants to subscribe for new KAT Ordinary Shares at an exercise price of 0.2p and with a three-year life to expiry, from the today's date.

ADMISSION AND TOTAL VOTING RIGHTS

Application will be made for the 830,716,920 Financing, Board and Service Shares to be admitted to trading on AIM which is expected to occur on or around 16 February 2024 ("Admission"). The Financing, Board and Service Shares will rank pari passu in all respects with the existing Ordinary Shares currently traded on AIM.

Following Admission, the Company's issued share capital will comprise 1,500,214,613 ordinary shares of 0.1 pence each. This number will represent the total voting rights in the Company and may be used by shareholders as the denominator for the calculation by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.

PDMR DISCLOSURE

The notification below, made in accordance with the requirements of the EU Market Abuse Regulation, provide further detail on the director's share dealing.

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no. 596/2014.

**ENDS**

For further information please visit www.katorogold.com or contact:

Beaumont Cornish Limited ('Beaumont Cornish') is the Company's Nominated Adviser and is authorised and regulated by the FCA. Beaumont Cornish's responsibilities as the Company's Nominated Adviser, including a responsibility to advise and guide the Company on its responsibilities under the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed solely to the London Stock Exchange. Beaumont Cornish is not acting for and will not be responsible to any other persons for providing protections afforded to customers of Beaumont Cornish nor for advising them in relation to the proposed arrangements described in this announcement or any matter referred to in it.