Hot Chili secures US$15M royalty deal

• Hot Chili executed an amended investment agreement to secure a US$15 million cash payment.
• The funding is non-dilutive and brings the total royalty arrangement value to US$30 million.
• The company intends to use the proceeds to advance its La Verde and broader Costa Fuego projects.

Hot Chili (ASX:HCH) executed an agreement to secure US$15 million by granting a copper-gold royalty over its La Verde asset.

The transaction expands a 2023 arrangement and covers a deposit that does not currently have a defined resource estimate.

"This transaction achieves two things simultaneously: it funds the advancement of La Verde without share dilution, and it gives the market a credible third-party datapoint on the value of an asset that has yet to be formally quantified," said Hot Chili Managing Director Christian Easterday.

The company stated that closing is expected in July and brings total royalty consideration to US$30 million.

Following the announcement, the Hot Chili share price was down at $1.73.

The explorer previously completed a separate $40 million equity funding round in February to support its projects.

Hot Chili continues to operate three drill rigs at La Verde ahead of a revised pre-feasibility study.