Hot Chili has secured US$25 million in debt funding which will be partially used to complete its prefeasibility study at its Productora copper project in Chile.
Hot Chili has secured $US25 million in debt funding which will be partially used to complete its prefeasibility study at its Productora copper project in Chile.
In addition to completing the PFS, the company said the funding would also be used for further drilling at Productora and for initial work on a definitive feasibility study.
In return, Hot Chili will pay Sprott an establishment fee $25,000 in cash, which is 1 per cent of the amount of the facility, and 11 million share options with an exercise price of 40 cents and maturity of 5 years.
The term sheet can also be extended for a further 12 months subject to a fee of 2 per cent of the outstanding amount, payable in Hot Chili shares.
As part of the deal, Hot Chili has also agreed to an exclusivity period to June 30 where it cannot approach alternative lenders.
Hot Chili expects to be able to draw from the facility by the end of June.
The company said it would pay a commerial rate of interest on the facility, which is understood to be about 12 per cent.