Mr. Gregory Duras reports

WESTERN METALLICA RESOURCES CORP. ANNOUNCES CONSOLIDATION AND SHARES-FOR-DEBT TRANSACTION

Western Metallica Resources Corp. has completed a share consolidation of its common shares on the basis of three preconsolidation common shares for each one postconsolidation common share, effective as of July 10, 2026. The consolidation is intended to optimize its capital structure and enhance the long-term value for the shareholders. Additionally, the company has completed its previously announced shares-for-debt transaction. Pursuant to the shares-for-debt agreement entered into on May 14, 2026, the company issued an aggregate of 2,466,667 postconsolidation common shares (representing 7.4 million preconsolidation common shares) at a deemed price of 15 cents per postconsolidation common share (or five cents per preconsolidation common share).

Consolidation

The new Cusip number is 95861P300 and the new ISIN number is CA95861P3007. Following the consolidation and prior to completion of the shares-for-debt transaction, the company had approximately 2,812,060 common shares issued and outstanding. No fractional common shares were issued as a result of the consolidation. Any fractional common share resulting from the consolidation was cancelled.

The company's registered shareholders hold their common shares in the direct registration system (DRS) and, as such, are not required to submit a letter of transmittal or surrender share certificates. Registered shareholders will automatically receive updated DRS statements from the company's transfer agent, Endeavor Trust Corp., reflecting the number of postconsolidated common shares to which they are entitled. Non-registered shareholders holding common shares of the company through an intermediary (a securities broker, dealer, bank or financial institution) should be aware that the intermediary may have different procedures for processing the consolidation than those that will be put in place by the company for registered shareholders. If shareholders hold their common shares of the company through intermediaries and have questions in this regard, they are encouraged to contact their intermediaries.

The company obtained TSX-V final approval for the consolidation on July 8, 2026, and obtained approval of the company's shareholders at the annual and special meeting of the company held on June 25, 2026.

Shares-for-debt transaction

The shares-for-debt agreement was entered into by the company and Greg Duras, the chief executive officer and director of the company. The shares-for-debt transaction settled indebtedness owing by the company to Mr. Duras pursuant to (a) an unsecured loan agreement between the company and Mr. Duras dated Jan. 24, 2025, and (b) an unsecured promissory note issued by the company to Mr. Duras dated April 30, 2026.

The shares-for-debt transaction resulted in full and final settlement of outstanding indebtedness under the loan agreement and partial settlement of the outstanding indebtedness under the promissory note in the aggregate amount of $370,000. The shares-for-debt transaction was undertaken by the company in order to strengthen the company's balance sheet and to enhance financial flexibility for future growth initiatives. Following the completion of the shares-for-debt transaction, the company has 5,278,727 common shares issued and outstanding.

The common shares issued pursuant to the shares-for-debt transaction are subject to a statutory hold period expiring four months and one day from the date of issuance in accordance with applicable Canadian securities laws. Completion of the shares-for-debt transaction remains subject to TSX-V final acceptance.

Each of the loans and the shares-for-debt transaction constituted a related party transaction as defined in Multilateral Instrument 61-101 -- Protection of Minority Securityholders in Special Transactions, as Mr. Duras is a director and officer of the company. The company has determined that the loans and the shares-for-debt transaction were exempt from formal valuation and minority approval requirements pursuant to Section 5.5(b), Section 5.7(f) and 5.7(g) of MI 61-101.

The shares-for-debt transaction resulted in Mr. Duras becoming a control person"of the company under applicable Canadian securities laws. Accordingly, pursuant to the policies of the TSX-V, the company obtained disinterested shareholder approval for Mr. Duras becoming a control person of the company at the annual and special meeting of the company's shareholders held on June 25, 2026.

About Western Metallica Resources Corp.

Western Metallica is an Ontario company with its head office in Toronto, Ont. Western Metallica is in the business of mineral resource exploration and development, its principal asset is its 100-per-cent-owned Penedela gold property in the Navelgas gold belt in Asturias, Spain. Western Metallica also has an interest in two other Spanish gold projects in the Navelgas gold belt in Asturias (Valledor and Sierra Alta) and one project located in Andalucia (Nueva Celti).

We seek Safe Harbor.