Mr. Christian Easterday reports

HOT CHILI EXECUTES OPTION TO ACQUIRE COMETA PROJECT IN CHILE

Hot Chili Ltd. has executed an option agreement with Bastion Minerals Ltd. for the right to acquire 100 per cent of Bastion's Cometa project in Chile, located near Hot Chili's Costa Fuego copper-gold project in the coastal range of the Atacama region, Chile.

Cometa consists of exploration and mining concessions covering approximately 56 square kilometres (km) in area located approximately 15 km southeast of Costa Fuego's planned operating centre and contiguous with Hot Chili's landholdings in the region.

Historical work by Bastion and previous explorers, including surface mapping, soil and rock sampling, and ground geophysics, identified several targets prospective for the discovery of breccia-hosted and iron-oxide-copper-gold mineralization. Should further exploration prove successful, any potential future mineral resources may be processed at Hot Chili's planned centralized processing facilities, as outlined in the company's June, 2023, PEA.

Execution of the option follows successful due diligence and is another step in Hot Chili's consolidation strategy for the Costa Fuego copper project.

The material terms of the option are as follows:

• Non-refundable cash payment of $100,000 (U.S.) to Bastion has been satisfied upon grant and execution of the option.
• Non-refundable cash payment of $200,000 (U.S.) within 12 months from the grant of the option to keep the option in good standing.
• Option may be exercised within 30 months of the date of grant.

If the option is exercised, the consideration payable to Bastion to purchase the Cometa concessions is:

• $2.4-million (U.S.) if the option is exercised by Hot Chili within 18 months from the date of grant of the option;
• $3-million (U.S.) if the option is exercised by Hot Chili within 30 months from the date of grant of the option.

Hot Chili may, subject to applicable regulatory approvals, including the approval of the TSX Venture Exchange, elect to satisfy the purchase consideration in cash (100 per cent), or in cash (50 per cent) and ordinary shares of Hot Chili (50 per cent) issued at a price per share equal to the greater of (i) the 15-day VWAP (volume-weighted average price) at the date of exercise of the option and (ii) the minimum price permitted by the TSX Venture Exchange.

The company looks forward to providing further updates across multiple continuing activity streams.

This announcement is authorized by the board of directors for release to ASX and TSX Venture Exchange.

Hot Chili's managing director and chief executive officer, Christian Easterday, is responsible for this announcement and has provided sign-off for release to the ASX and TSX Venture Exchange.

We seek Safe Harbor.