#Australia #Hot Chili #La Verde #Perth #OR Royalties

Hot Chili Limited Secures $15 Million via New Royalty Agreement with OR Royalties Inc.

In a significant development for the mining sector, Hot Chili Limited (ASX: HCH) has announced a binding agreement with OR Royalties Inc. to secure a substantial investment of $15 million. Announced on July 7, 2026, this agreement marks a pivotal moment for Hot Chili as it looks to advance its La Verde Project, part of the larger Costa Fuego copper-gold initiative located in the Huasco Valley, Chile.

The amended agreement, known as the Amended and Restated Investment Agreement (AR Investment Agreement), outlines that OR will receive a Net Smelter Return (NSR) royalty on the La Verde Project. This recent financial influx brings the total royalty consideration under the agreement with OR to an impressive $30 million, with the proceeds earmarked for further development of La Verde and the broader Costa Fuego project.

Key Highlights from the Agreement

• - A non-dilutive funding boost of $15 million situates Hot Chili in a robust position to enhance its exploration projects without impacting shareholder equity.
• - The addition of La Verde to OR's royalty portfolio signals confidence from one of North America’s most reputable royalty companies, especially as the project is still in the pre-resource stage.
• - The original royalty arrangement from 2023, which coincided with Hot Chili's Preliminary Economic Assessment (PEA), showcased a mineral resource estimate of 725 million tons. Just recently, this estimate was upgraded to 798 million tons, demonstrating the project's growing viability and resource potential.

Hot Chili's Managing Director, Christian Easterday, expressed enthusiasm about the deal, stating, "The commitment from OR to further invest in a pre-resource deposit underlines the potential we perceive at La Verde and reinforces our plans for the Costa Fuego production hub. This agreement not only provides capital but also serves as a validation point for our future outlook."

Details of the Amended Agreement

The arrangement includes varied terms that remain largely unchanged from the original agreement, with notable additions such as:

• - Royalty Consideration: The total payment to OR has now reached $30 million, including the recent $15 million.
• - Royalty Interest: The royalty now extends to include La Verde, which is essential for its development prospects.
• - Use of Proceeds: At least 90% of the proceeds from the investment are required to be allocated to exploration, development, and general advancement of the Costa Fuego Project,

The anticipated closing date for this transaction is within July 2026, contingent upon satisfaction of customary conditions prerequisite for this type of agreement.

As Hot Chili proceeds with this substantial investment, it aims to enhance exploration activities on the La Verde deposits, applying three drill rigs to extract further insights into the mineral potential. The company also plans to provide ongoing updates leading up to a maiden Mineral Resource Estimate for La Verde.

Forward-Looking Statements

Despite the promising outlook, it is important to recognize the inherent risks associated with mining exploration. Forward-looking statements referenced in this announcement highlight potential challenges including market volatility and operational risks that could affect the outcomes of the projects. Hot Chili remains committed to navigating these uncertainties as it prioritizes transparency and diligence in its operations.

For more details and regular updates on Hot Chili's initiatives and the La Verde Project's progress, interested parties can follow the company’s official communications or visit their website.

Contact:
Christian Easterday, Managing Director
Hot Chili Limited
Email: [email protected]

In conclusion, this recent investment from OR Royalties Inc. represents not just a financial boost but also a strong endorsement of Hot Chili's long-term strategy and the potential of the La Verde project. With the strengthening of its resource base and funding, Hot Chili is well-positioned to capitalize on the growing demand for copper and gold in the coming years.