Mr. Deepak Varshney reports

TOTEC RESOURCES ANNOUNCES CLOSING OF QUALIFYING TRANSACTION AND ANTICIPATED TRADING DATE

Totec Resources Ltd. and Usha Resources Ltd. have closed the sale of 1540359 B.C. Ltd. (Subco) to Totec and, indirectly, Totec's acquisition of the 489 mineral claims constituting the White Willow property, which covers approximately 10,220 hectares in the Thunder Bay mining division, approximately 170 kilometres west of Thunder Bay.

The transaction was completed pursuant to a share purchase agreement dated Oct. 22, 2025, as amended Dec. 10, 2025, among Totec, Usha and Subco. The purchase price paid by Totec for the transaction was an aggregate of 35.5 million common shares (defined herein) issued to the shareholders of Subco (5.5 million of which were issued to Usha and 30 million of which were issued to the investors (defined herein)) and $50,000 in cash paid to Usha. The transaction constitutes the qualifying transaction of Totec, as such term is defined in the rules and policies of the TSX Venture Exchange. The name of the resulting issuer is Totec Resources Ltd. No finders' fees were paid in connection with the transaction.

The property is now indirectly owned by the company through Subco and is subject to the following net smelter return royalties (NSRs): (i) a 1.5-per-cent NSR in favour of 2758145 Ontario Ltd., two-thirds of which can be repurchased for $1-million, and (ii) a 1.5-per-cent NSR in favour of Grid Metals Corp., two-thirds of which can be repurchased for $1.25-million.

Immediately prior to the closing of the qualifying transaction, the company consolidated its issued and outstanding common shares on a two-to-one basis. The new ISIN and Cusip of the common shares following are CA89157M2040 and 89157M204, respectively.

Final acceptance of the qualifying transaction will occur upon the issuance of the final exchange bulletin by the exchange. Subject to final acceptance by the exchange, the company will be classified as a Tier 2 mining issuer pursuant to exchange policies. The common shares are expected to commence trading on the exchange under the symbol TOTC at the opening of the markets on Jan. 21, 2026.

Following completion of the qualifying transaction, the officers and directors of the resulting issuer are as follows: (i) Deepak Varshney (chief executive officer, corporate secretary and director); (ii) Khalid Naeem (chief financial officer); (iii) James Walker (director); (iv) Zachary Kotowych (director); and (v) Rishi Kwatra (director).

In connection with the transaction, on Jan. 19, 2026, Subco completed a private placement, through the issuance of 30 million units of Subco to arm's-length investors at a price of 15 cents per unit for gross proceeds of $4.5-million. Each unit comprises one common share of Subco and one common share purchase warrant of Subco entitling the holder thereof to acquire one additional Subco share at an exercise price of 25 cents for a period of two years from the date of issuance. Subco paid the following cash finders' fees and issued the following non-transferable finders' warrants to eligible finders in connection with the concurrent financing: (i) $143,423 cash and 956,153 finders' warrants to Research Capital Corp.; (ii) $999 cash and 6,660 finders' warrants to Ventum Financial Corp.; and (iii) $1,700 cash and 11,330 finders' warrants to Haywood Securities Inc. Each finder's warrant was exercisable into one Subco share at 25 cents for a period of three years from the date of issuance.

As a result of the transaction, (i) the investors exchanged each Subco share held for one common share; (ii) each Subco warrant became automatically exercisable into one common share at an exercise price of 25 cents for a period of two years from the date of issuance; and (iii) each finder's warrant became automatically exercisable into one common share at an exercise price of 25 cents for a period of three years from the date of issuance.

Deepak Varshney, chief executive officer and a director of Totec, currently serves as the CEO and as a director of the company and beneficially owns a total of 2,169,500 common shares of Usha, representing 2.4 per cent of the issued and outstanding common shares of Usha. Also, Khalid Naeem, CFO of Totec, currently serves as CFO of Usha and holds no common shares of Usha. In this regard: (i) the transaction involved non-arm's-length parties (as such term is defined in the rules and policies of the exchange); (ii) the transaction was not a related party transaction (as such term is defined in Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions) or subject to TSX-V Policy 5.9 -- Protection of Minority Security Holders in Special Transactions as neither Mr. Varshney nor Mr. Naeem, nor their associates nor affiliates, are control persons (as such terms are defined in the exchange's policies) of both Totec and in relation to Subco or the property; (iii) the transaction was not considered a non-arm's-length qualifying transaction for Totec as neither Mr. Varshney nor Mr. Naeem, nor their associates nor affiliates, are control persons in both Totec and in relation to Subco or the property; and (iv) the transaction was not subject to disinterested shareholder approval of Usha or Totec.

Full details of the qualifying transaction and related matters are set out in the filing statement of the company dated Jan. 12, 2026, which can be found under the company's SEDAR+ profile.

The company also announces that it has not yet held its 2025 annual general meeting as required under the Business Corporations Act (British Columbia) and intends to remedy this by holding an annual general meeting of shareholders on March 5, 2026 (the 2026 AGM). The company's last annual general meeting of shareholders was held on Jan. 17, 2024. The record date for determining shareholders entitled to receive notice of and vote at the 2026 AGM will be Jan. 29, 2026. Matters to be considered at the 2026 AGM are expected to include, among other things, the election of directors, the appointment of the auditor and the approval of the company's equity incentive plan. Meeting materials, including the management information circular and form of proxy, will be mailed to shareholders and filed on SEDAR+ in accordance with applicable securities laws and will be available under the company's profile once distributed.

Trading in the common shares has been halted, and will remain halted, pending the satisfaction of all applicable requirements of Policy 2.4 of the exchange. There can be no assurance that trading of the common shares will resume prior to the completion of the qualifying transaction.

About Totec Resources Ltd.

Totec Resources is a North American mineral acquisition and exploration company focused on the development of quality properties that are drill-ready with high-upside and expansion potential. Totec's flagship asset is the White Willow lithium-tantalum-rare-earth-element project, located approximately 170 kilometres west of Thunder Bay.

We seek Safe Harbor.