Hot Chili Announces A$14M Rights Issue to Support Completion of Strategic Partnering Process & Maiden La Verde Resource Estimate
Hot Chili Announces A$14M Rights Issue to
Support Completion of Strategic Partnering
Process & Maiden La Verde Resource
Estimate
/NOT FOR RELEASE TO US WIRE SERVICES OR DISTRIBUTION IN
THE UNITED STATES
/
PERTH, Australia
,
Aug. 5, 2025
/CNW/ - Hot Chili Limited (ASX: HCH) (TSXV: HCH) (OTCQX:
HHLKF) ("Hot Chili" or the "Company") is pleased to announce that the Company will be undertaking
a
A$14 million
funding, exclusively offered to all eligible shareholders.
The
A$14 million
funding will be via non-renounceable entitlements offer of new shares on a 2 for 13
basis, at an issue price of
A$0.60
(
60 cents
) per share (the "Rights Issue" or "Entitlement Offer").
The Rights Issue provides an opportunity for all eligible shareholders to participate in the funding of
the Company at a pivotal time, removing near-term funding uncertainty and providing a pathway to
delivering several transformational catalysts over the coming months, including:
Completion of the Company's asset-level strategic partnering process
As detailed in the Company's recent quarterly report for the period ending
30 June 2025
(released
29 July 2025
), following completion of the Pre-feasibility Studies ("PFS") for Costa
Fuego and Huasco Water, Hot Chili initiated asset-level strategic partnering processes
("Partnering Process") to introduce one or more qualified partners with the financial, technical
and operational capability to assist in funding and delivering each project. The Partnering
Process is ongoing, and the Company confirms it is currently assessing several nonbinding,
indicative, incomplete and conditional proposals.
The Partnering Process may result in a range of possible transactions for the projects.
Investors are cautioned that there is no certainty the Partnering Process will result in a
transaction or binding agreement. The Company will keep the market updated in accordance
with its continuous disclosure obligations.
Hot Chili has appointed BMO Capital Markets as its financial adviser in connection with the
Partnering Process.
Commencement of phase-two diamond drilling at the La Verde copper-gold discovery
The La Verde copper-gold (Cu-Au) discovery ("La Verde") is located approximately 30km south
of the Company's Costa Fuego Cu-Au Project ("Costa Fuego" or "the Project") planned central
processing hub, at low elevation, in the coastal range of the Atacama region, Chile.
The Company concluded a phase-one drilling campaign across La Verde on
10 April 2025
, with
a total of 31 Reverse Circulation (RC) drill holes (
9,600 m
) completed to date. Drill results have
defined an extensive +0.2% Cu mineralisation footprint of
1,000 m
by
750 m
extending up to
400 m
vertical depth and remaining open laterally and at depth.
Importantly, multiple distinct higher-grade centres have been confirmed from near surface, with
several stand-out drill results reported including
308m
grading 0.5% Cu and 0.3g/t Au from
46m
depth to end of hole, which included
100m
grading 0.7% Cu, 0.3g/t Au from
118m
depth
(announced
18 December 2024
). Over half of Hot Chili's drill holes have ended in
significant mineralisation (at the depth of RC drill rig capability).
Planned diamond drilling is expected to facilitate a maiden mineral resource estimate for La
Verde, providing near-term, material resource growth and potential front-end, open pit, higher
grade mine life additions for Costa Fuego.
Hot Chili' Managing Director
Christian Easterday
said:
"Funding from the Rights Issue will facilitate another significant upgrade to the Company's copper
and gold resource base at a time of strong market conditions for both commodities.
"A strengthened balance sheet will also provide the Company with the necessary funds to complete
its strategic partnering process aimed at potentially unlocking asset-level funding for Costa Fuego
and Huasco Water.
"We are very pleased to exclusively offer to all eligible shareholders, full exposure to both near-term,
key catalysts which this funding will support."
Details of the Rights Issue (Entitlement Offer)
The Rights Issue is a non-renounceable pro rata offer of 2 (two) fully paid ordinary shares in the
Company ("New Shares") for every 13 (thirteen) existing shares held by eligible shareholders
registered at
5.00pm
(AWST) on
8 August 2025
("Record Date"), at an issue price of
A$0.60
(
60
cents
) per New Share ("Offer Price'), to raise up to approximately
$14 million
before costs (the
"Entitlement Offer"). The Entitlement Offer will be made pursuant to an offer document under section
708AA of the Corporations Act ("Offer Document").
The Offer Price represents a 3.4% premium to the last closing price of the Company's shares
traded on ASX on
4 August 2025
of
A$0.58
and a 4% discount to the 15-day VWAP.
The Entitlement Offer is non-renounceable and is not underwritten.
Eligible shareholders who take up their entitlements in full may also apply for additional New Shares
under the shortfall facility to the Entitlement Offer.
In respect to any potential shortfall to the Entitlement Offer, the directors of Hot Chili will reserve the
right to allocate any, all, or none of the shortfall to sophisticated and professional investors at their
discretion.
The issue of New Shares under the Entitlement Offer and placement of any shortfall to the
Entitlement Offer to non-related parties of the Company is not subject to shareholder approval.
The Entitlement Offer and the placement of any shortfall to the Entitlement Offer is exclusively
managed by Veritas Securities Limited as lead manager.
Certain insiders of the Company are expected to participate in the Entitlement Offer and as a result,
the Entitlement Offer may constitute a "related party transaction" within the meaning of Multilateral
Instrument 61-101 –
Protection of Minority Shareholders in Special Transactions
("MI 61-101").
The Entitlement Offer is not subject to the formal valuation and minority shareholder approval
requirements under MI 61-101 as the Entitlement Offer is a transaction in which the general body of
holders of the Company's ordinary shares in
Canada
are treated identically on a per share basis and
the transaction has no "interested party" within the meaning of MI 61-101. If the Entitlement Offer is
subject to the formal valuation and minority shareholder approval requirements under MI 61-101, the
Entitlement Offer would in any event be exempt from such requirements in reliance upon the
exemptions contained in 5.5(a) and 5.7(1)(a), respectively, of MI 61-101 as the fair market value of
the Entitlement Offer, insofar as it involves interested parties, will not be more than 25% of the
Company's market capitalisation.
Full details of the Entitlement Offer are set out in the Offer Document which will be available for
review on the Company's website at
www.hotchili.net.au
and on SEDAR+ (
www.sedarplus.ca
)
under Hot Chili's issuer profile.
Timetable
The proposed timetable for the Entitlement Offer is as follows (stated times and dates are times and
dates in
Perth
,
Western Australia
):
Event
Date
Offer Document, notice under section 708AA(2)(f) of the
Corporations Act and Appendix 3B lodged with ASX
Tuesday, 5 August 2025
Ex-date (date from which Shares begin trading without the right
to participate in the Entitlement Offer)
Thursday, 7 August 2025
Record Date (to identify Shareholders entitled to participate in
the Entitlement Offer)
5:00pm (AWST)
Friday, 8 August 2025
Offer Document and Entitlement and Acceptance Forms sent to
Eligible Shareholders
Wednesday, 13 August 2025
Offer opens (Opening Date)
Wednesday, 13 August 2025
Last day to extend the Closing Date
Before 10:00am (AWST)
Thursday, 28 August 2025
Offer closes (Closing Date)
5:00pm (AWST)
Tuesday, 2 September 2025
New Shares quoted on ASX on a deferred settlement basis
Wednesday, 3 September 2025
Announcement to ASX of Entitlement Offer acceptances and
shortfall
Friday, 5 September 2025
New Shares issued
Tuesday, 9 September 2025
Quotation of New Shares on ASX commences on a normal
basis
Wednesday, 10 September 2025
Note: These dates are indicative only and subject to change. Subject to the ASX Listing Rules and
the policies of the TSX Venture Exchange ("TSXV"), the Company may vary these dates without
notice. In particular, the Company reserves the right to extend the Closing Date and to accept late
acceptances either generally or in particular cases. Any extension of the Closing Date will have a
consequential effect on the allotment date of New Shares. The commencement of quotation of the
New Shares on ASX is subject to confirmation from ASX. The listing of the New Shares on TSXV is
subject to the approval of the TSXV.
This announcement is authorised by the Board of Directors for release to ASX and TSXV.
For more information please contact:
Christian Easterday
Managing Director – Hot Chili
Tel: +61 8 9315 9009
Email:
Carol Marinkovich
Company Secretary – Hot Chili
Tel: +61 8 9315 9009
Email:
Graham Farrell
Email:
Investor & Public Relations
or visit Hot Chili's website at
www.hotchili.net.au
Figure 1. Location of Hot Chili’s Costa Fuego project, coastal range Chile (CNW Group/Hot Chili
Limited)
Qualifying Statements
Qualified Person – NI 43-101
The technical information in this announcement has been reviewed and approved by Mr.
Christian
Easterday
, MAIG, Hot Chili's Managing Director and a qualified person within the meaning of
National Instrument 43-101
–
Standards of Disclosure for Mineral Projects
.
Exploration Results – JORC and ASX
The information in this announcement that relates to exploration results for the La Verde project was
previously reported in the Company's announcements released to ASX on
18 December 2024
'Hot
Chili Intersects Significant Copper-Gold, Porphyry-style Mineralisation at La Verde' and
19 May
2025
'Hot Chili Announces Latest Drill Results for La Verde, Doubling Porphyry Discovery Footprint',
which are available to view on the Company's website at
www.hotchili.net.au/investors/asx
-
announcements/
. The Company confirms that it is not aware of any new information or data that
materially affects the information included in the original market announcements.
Disclaimer
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in
the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of
this announcement.
Forward Looking Statements
This announcement contains certain statements that are "forward-looking information" within the
meaning of Canadian securities legislation and Australian securities legislation (each, a "forward-
looking statement"). Forward-looking statements reflect the Company's current expectations,
forecasts, and projections with respect to future events, many of which are beyond the Company's
control, and are based on certain assumptions. No assurance can be given that these expectations,
forecasts, or projections will prove to be correct, and such forward-looking statements included in
this announcement should not be unduly relied upon. Forward-looking information is by its nature
prospective and requires the Company to make certain assumptions and is subject to inherent risks
and uncertainties. All statements other than statements of historical fact are forward-looking
statements. The use of any of the words "estimate", "expectations", "may", "plan", "potential",
"project", "reinforce", "unlock", "large-scale", "could", "should", "will", "would", variants of these
words and similar expressions are intended to identify forward-looking statements.
The forward-looking statements within this announcement are based on information currently
available and what management believes are reasonable assumptions. Forward-looking statements
speak only as of the date of this announcement.
In this announcement, forward-looking statements relate, among other things, to: the Rights Offer,
including the timing and results thereof, the receipt of all required regulatory approvals therefor, and
the anticipated use of proceeds thereof; the timing and completion, if at all, of the Partnering
Process; the potential of the La Verde discovery, including the timing and ability, if at all, to publish a
maiden mineral resource estimate; the potential for front-end, open pit, higher grade mine life
additions for Costa Fuego; regulatory applications and approvals; the timing and results of future
economic studies; and the Company's future exploration and other business plans.
Forward-looking statements involve known and unknown risks, uncertainties, and other factors,
which may cause the actual results, performance, or achievements of the Company to be materially
different from any future results, performance or achievements expressed or implied by the forward-
looking statements. A number of factors could cause actual results to differ materially from a
conclusion, forecast or projection contained in the forward-looking statements in this announcement,
including, but not limited to, the following material factors: the results of the Rights Offer; the results
of the Partnering Process; the ability of drilling and other exploration activities to accurately predict
mineralisation; operational risks; risks related to the cost estimates of exploration; sovereign risks
associated with the Company's operations in
Chile
; changes in estimates of mineral resources or
mineral reserves of properties where the Company holds interests; recruiting qualified personnel and
retaining key personnel; future financial needs and availability of adequate financing; fluctuations in
mineral prices; market volatility; exchange rate fluctuations; ability to exploit successful discoveries;
the production at or performance of properties where the Company holds interests; ability to retain
title to mining concessions; environmental risks; financial failure or default of joint venture partners,
contractors or service providers; competition risks; economic and market conditions; and other risks
and uncertainties described elsewhere in this announcement and elsewhere in the Company's public
disclosure record.
Although the forward-looking statements contained in this announcement are based upon
assumptions which the Company believes to be reasonable, the Company cannot assure investors
that actual results will be consistent with these forward-looking statements. With respect to forward-
looking statements contained in this announcement, the Company has made assumptions regarding:
future commodity prices and demand; availability of skilled labour; timing and amount of capital
expenditures; future currency exchange and interest rates; the impact of increasing competition;
general conditions in economic and financial markets; availability of drilling and related equipment;
effects of regulation by governmental agencies; future tax rates; future operating costs; availability of
future sources of funding; ability to obtain financing; and assumptions underlying estimates related to
adjusted funds from operations. The Company has included the above summary of assumptions and
risks related to forward-looking information provided in this announcement to provide investors with a
more complete perspective on the Company's future operations, and such information may not be
appropriate for other purposes. The Company's actual results, performance or achievement could
differ materially from those expressed in, or implied by, these forward-looking statements and,
accordingly, no assurance can be given that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do so, what benefits the Company will derive
therefrom.
For additional information with respect to these and other factors and assumptions underlying the
forwardlooking statements made herein, please refer to the public disclosure record of the
Company, including the Company's most recent Annual Report, which is available on SEDAR+ (
www.sedarplus.ca
) under the Company's issuer profile. New factors emerge from time to time, and
it is not possible for management to predict all those factors or to assess in advance the impact of
each such factor on the Company's business or the extent to which any factor, or combination of
factors, may cause actual results to differ materially from those contained in any forward-looking
statement.
The forward-looking statements contained in this announcement are expressly qualified by the
foregoing cautionary statements and are made as of the date of this announcement. Except as may
be required by applicable securities laws, the Company does not undertake any obligation to publicly
update or revise any forward-looking statement to reflect events or circumstances after the date of
this announcement or to reflect the occurrence of unanticipated events, whether as a result of new
information, future events or results, or otherwise. Investors should read this entire announcement
and consult their own professional advisors to ascertain and assess the income tax and legal risks
and other aspects of an investment in the Company.
Not for release to US wire services or distribution in
the United States
This announcement has been prepared for publication in
Australia
and
Canada
and may not be
released to US news wire services or distributed in
the United States
. This announcement does not
constitute an offer to sell, or a solicitation of an offer to buy, securities in
the United States
or any
other jurisdiction in which such sale, solicitation or offer would be unlawful. Any securities described
in this announcement have not been, and will not be, registered under the US Securities Act of 1933
(the "US Securities Act") and may not be offered or sold in
the United States
except in transactions
exempt from, or not subject to, the registration of the US Securities Act and applicable US state
securities laws.
SOURCE
Hot Chili Limited
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