Replacement: Loan Agreement, Operational Update...

The following amendment has been made to the 'Loan Agreement, Operational Update, Board Changes, Appointment of Nominated Adviser' announcement released on Tuesday, 10 January 2017 at 07:00 (UK time) under RNS No 7338T and at 09:00 (SA time) on SENS.

Lola Trollip

Current Directorships:

Central Rand Gold NV

Ferreira Estate and Investment Company Limited

Former Directorships:

Turbo Tech Pumps Limited

Hanlo Mining Supplies Close Corporation

Hanlo Labour Hire Close Corporation

There is nothing more to disclose in accordance with AIM Rule 17 or Schedule 2(g) of the AIM Rules.

All other details remain unchanged.

The full amended text is shown below.

Loan Agreement

Further to the announcement dated 25 November 2016, the Company hereby announces that it has entered into a new loan agreement ("the Loan Agreement") with Mr Jia Bang Wang ("Mr Wang") for funding in the amount of US$1 million ("Loan"). The Loan will be provided in two tranches, with the first tranche of US$500 000 having already been received by the Company and a further US$500 000 becoming available on or by 31 March 2017. The principal and accrued interest on the Loan (at the UK's prime lending rate plus 2% per annum) is repayable by the Company on or by 9 July 2017. Interest accrues and capitalises from day to day, from the day any part of the Loan is advanced until and including the day the whole of the Loan is repaid.

The board of directors of Central Rand Gold ("Board") believe that the Loan will provide the Company with sufficient working capital for the immediate future and for the procurement, shipping, instalment and commissioning of a Concentrator Circuit. As announced on 6 October 2016, the Company has executed an agreement to acquire Mine Waste Dumps that contain 2.3 million tonnes of gold bearing materials, with an average in-situ grade of 0.7g/t. As a result of the successful conclusion of the concentrator test work conducted in 2016, the Company has resolved to procure a Concentrator Circuit to upgrade the gold grade of the Mine Waste Dumps materials before further metallurgical processing. The Concentrator Circuit will contain centrifugal concentrators, scrubber, de-watering screens, water/slurry pumps and other ancillary equipment. The Board, which is currently in negotiations with the Concentrator Circuit's manufacturers, anticipates that it will be in a position to start placing orders for the equipment this quarter, thus allowing for shipment and installation by the second quarter of 2017.

Operational Update

As previously announced, the Company commissioned Mill No 1 in November 2016. Together with Mill No 3, both mills are able to provide a nameplate milling capacity of 800 tonnes per day. Subject to production downtime, the Company has been processing approximately 500 tonnes of toll treatment materials per day for the past six weeks. Management is committing to minimising production downtime and improving production efficiency to carry the current operation until the Concentrator Circuit has been installed and commissioned. The pumping of the water in the Central Basin is, and has always been, the responsibility of Trans-Caledon Tunnel Authority (TCTA), a South African government institution. During the past two months, Johannesburg has experienced higher than normal rainfall, causing the water levels to rise to 143.2 vertical meters below surface, being the same level as at the beginning of 2016.

Board Changes

The Company is delighted to announce that Simon Charles has joined the Board as the Independent Non-Executive Chairman of the Company with immediate effect. Mr Charles is a senior partner in a firm of solicitors, Marriott Harrison LLP, and heads that firm's Equity Capital Markets team. In addition, Mr Charles sits on the board of another AIM company, Imaginatik Plc, and is a member of the QCA's Corporate Finance Experts group. He is a former Qualified Executive for the purposes of the AIM Rules for Nominated Advisers and was a regulated individual in Numis Securities Limited providing Main Market sponsor advisory services. Mr Charles advises a number of Nominated Advisers and companies on, amongst other things, matters pertaining to resources.

The Company is also pleased to announce that Lola Trollip, acting Chief Executive Officer and Managing Director of Central Rand Gold (Netherlands Antilles) N.V. and, for the past nine months, Chief Executive Officer of Central Rand Gold South Africa Proprietary Limited, has joined the Board as Chief Executive Officer with immediate effect.

Furthermore, the Company is pleased to announce that Wei Fan ("William") Zhuang has joined the Board as a Non-Executive Director with immediate effect.

Nathan Taylor and Mark Austin have stepped down as Interim Non-Executive Chairman and Non-Executive Director, respectively. The Board would like to thank Nathan and Mark for their efforts over the course of their service.

Appointment of Nominated Adviser & Broker

The Company is pleased to announce the appointment of ZAI Corporate Finance Limited as its Nominated Adviser and Broker with immediate effect.

Related Party Transaction

The Loan is regarded as a related party transaction as defined by the AIM Rules for Companies due to the extent of Mr Wang's shareholding in the Company, amounting to 19,704,434 ordinary shares of the Company, representing 9.48% per cent. of the ordinary shares currently in issue. The Board, having consulted with ZAI Corporate Finance Limited, the Company's Nominated Adviser, believes that the terms of this related party transaction are fair and reasonable insofar as the shareholders of the Company are concerned.

Relationship Agreement 

Reflecting his material shareholding and the additional provision of the Loan described above, the Company has entered into a relationship agreement with Mr Wang and ZAI Corporate Finance, as Nominated Adviser, which regulates the continuing relationship between Mr Wang and the Company so as to ensure that the Company will at all times be capable of carrying on its business independently of Mr Wang. The Company has also entered into a separate relationship agreement with each of Redstone Capital Limited and Mr Yizhou Gu and in each case ZAI Corporate Finance as Nominated Adviser which similarly guarantee that the Company will at all times be capable of carrying on its business independently.

Statement from the Chairman

"I am delighted to be joining the Board of Central Rand Gold at this key stage in its development. I would very much like to congratulate Lola on her appointment as CEO, she has added considerable expertise and "grip" to operations since joining as Managing Director of our operating company. Together with the other directors, in the light of the additional capital and the Concentrator Circuit proposed to come on stream this year, we are confident that the Company is now well positioned to implement its core strategy of generating revenue from our assets and delivering meaningful returns for our shareholders."

The following details in relation to the appointment of Mr Charles, Ms Trollip and Mr Zhuang are disclosed in accordance with Schedule 2(g) of the AIM Rules:

Simon Charles

Current Directorships and Partnerships:

Drewry Limited

Financial Holdings Limited

Imaginatik PLC

IOMA Group (UK) Limited

Isle of Man Assurance Limited

Strategic Counsel Partners LLP

Sweet Truck Haul Limited

Marriott Harrison LLP

MH Secretaries Limited

MH Nominees Limited

The Invicta Film Partnership No.22 LLP

Previous Directorships:

Ahealth Informatics Limited

Caterham Barracks Community Trust

DKG Capital PLC

Magwitch Media Partners Limited

MH Directors Limited

MH Directors(2) Limited

SRC Capital Limited

Lola Trollip

Current Directorships:

Central Rand Gold NV

Ferreira Estate and Investment Company Limited

Former Directorships:

Turbo Tech Pumps Limited

Hanlo Mining Supplies Close Corporation

Hanlo Labour Hire Close Corporation

Wei Fan Zhuang

Current Directorships:

Central Rand Gold South Africa Proprietary Limited

Redstone Capital Limited

Sea Bright Investments Limited

MP Mining International Pty Limited

Beijing Songfeng Redstone Consulting Co Limited

Previous Directorships:

Roc Salt Limited

There is nothing more to disclose in accordance with AIM Rule 17 or Schedule 2(g) of the AIM Rules.

For further information, please contact:

Central Rand Gold +27(0) 87 310 4400 

Lola Trollip

ZAI Corporate Finance Ltd - Nominated Adviser & Broker +44 (0) 20 7060 2220

John Treacy / Jamie Spotswood

Merchantec Capital - JSE Sponsor +27 (0) 11 325 6363

Monique Martinez / Marcel Goncalves

10 January 2017

The information communicated in this announcement is inside information for the purposes of Article 7 of Market Abuse Regulation 596/2014 ("MAR").