File: '\\swfile\EmailIn\20260812 130533 Attachment Encanto Potash - News Release Announcing Rights Offering (August 12 2026).docx'

2

2

Jackpot Digital Inc.

Suite 400, 570 Granville Street

Vancouver, BC V6C 3P1

Tel: (604) 681-0204 Fax: (604) 681-9428

www.jackpotdigital.com email: info@jackpotdigital.com

Encanto Potash Corp. Suite 3123, 595 Burrard Street

Vancouver, BC V7X 1J1

Tel:(604)719-8129

www.epotash.com email: info@epotash.com

LEGAL_44402743.15

LEGAL_44402743.15

THIS NEWS RELEASE IS NOT FOR DISTRIBUTION TO U.S. NEWSWIRES OR DISSEMINATION IN THE UNITED STATES

ENCANTO POTASH ANNOUNCES RIGHTS OFFERING

VANCOUVER, BRITISH COLUMBIA - August 12, 2026 - Encanto Potash Corp. (the "Company" or "Encanto") (TSX-V: EPO.H) is pleased to announce that it will be making a rights offering (the "Rights Offering") in which holders of record of the Company's common shares (each, a "Common Share"), as of the record date of August 20, 2026 (the "Record Date"), will receive rights (each, a "Right") to subscribe for securities of the Company, as further described below. There are currently 19,098,379 Common Shares issued and outstanding. Each shareholder as of the Record Date will receive one Right for each Common Share held. One point two five (1.25) Rights will permit the shareholder to purchase one unit (a "Unit") at a price of $0.02 per Unit (the "Basic Subscription Privilege"). The Rights will expire at 2:00 p.m. (Vancouver, Pacific time) on September 10, 2026 (the "Expiry Date"). Holders of Rights who fully exercise their Rights under the Basic Subscription Privilege will also be entitled to subscribe, on a pro rata basis, for additional Units, if available, that were not subscribed for by other holders of Rights, subject to certain limitations as set out in the Company's Rights Offering circular (the "Rights Offering Circular").

Description of Rights Offering

Each Unit will consist of one Common Share and one transferable Common Share purchase warrant (a "Warrant"). Each four (4) Warrants will entitle the holder to purchase one additional Common Share at a price of $0.07 per Common Share exercisable for one year from the Expiry Date. The Rights will be transferable, however they will not be listed for trading on the TSX Venture Exchange (the "Exchange").

The Units will not separate into Common Shares and Warrants for a period of 60 days from the Expiry Date or upon earlier directors' approval.

The Rights will not be listed and will expire 2:00 p.m. (Vancouver, Pacific time) on the Expiry Date, after which time unexercised Rights will be void and of no value.

The Rights Offering is not subject to any minimum subscription level. If the Rights Offering is fully subscribed, Encanto will issue up to 15,278,703 new Common Shares and 15,278,703 Warrants to purchase up to an additional 3,819,675 Common Shares, for total gross proceeds of approximately $305,574. If the Rights Offering is fully subscribed and all of the Warrants issued on closing of the Rights Offering are exercised, the additional proceeds to the Company will be approximately $267,377. If all Rights are exercised, the Company's issued and outstanding Common Shares will increase to 34,377,082 and if all Warrants covered by this Rights Offering are exercised, the number of issued and outstanding Common Shares will be 38,196,757 and 40,696,757 if all Bonus Warrants (as defined below) are exercised.

A Notice of Rights Offering and a Rights Subscription Form will be mailed to each registered shareholder of the Company resident in Canada as at the Record Date. Registered shareholders who wish to exercise their Rights must complete the Rights Subscription Form and deliver the Rights Subscription Form, together with the applicable purchase funds, to the rights agent, Endeavor Trust Corporation before 2:00 p.m. (Vancouver, Pacific time) on the Expiry Date. Shareholders who own their Common Shares through an intermediary, such as a bank, trust company, securities dealer or broker, will receive materials and instructions from their intermediary.

The terms of the Rights Offering and the procedures for exercising Rights will be explained in the Rights Offering Circular. The Rights Offering Circular is available under the Company's profile on the SEDAR+ website at www.sedarplus.ca.

The Rights Offering will be made only in applicable jurisdictions in Canada, and is not, and under no circumstances to be construed as an offering of any securities for sale in, or to a resident of any jurisdiction, other than Canada, or a solicitation therein or an offer to buy or sell securities. However, certain holders of Common Shares in jurisdictions outside of Canada may be able to participate in the Rights Offering where they can establish that the transaction is exempt under applicable laws. If you are a shareholder of the Company and reside outside of Canada, please review the Notice of Rights Offering and Rights Offering Circular to determine your eligibility and the process and timing requirements to receive and, or, exercise your Rights. The Company requests any ineligible holder interested in exercising their Rights to contact the Company at their earliest convenience.

The Rights Offering is subject to regulatory approval, including the approval of the Exchange.

Standby Guarantees

Mr. Nick Watters, one of Encanto's directors has agreed to act, directly or indirectly, as a standby guarantor to purchase up to 500,000 Units that may be available as a result of any unexercised Rights under the Rights Offering, for subscription funds of up to $10,000. In addition, several arm's length third parties have agreed to act as standby guarantors to purchase, in the aggregate, up to 9,500,000 Units that may be available as a result of any unexercised Rights under the Rights Offering, for subscription funds of up to $190,000. As consideration for acting as a standby guarantors, the Company will issue bonus warrants (the "Bonus Warrants") to: Mr. Watters entitling him to acquire up to 125,000 Common Shares of the Company; and to the other standby guarantors entitling them collectively to acquire up to 2,375,000 Common Shares, being 25% of the total number of Units the standby guarantors have agreed to purchase under their standby commitments. The Bonus Warrants are exercisable at a price of $0.07 per Common Share for a period of one year after the date on which performance under the guarantee could be required. With the exception of Paul Chow, all standby guarantors do not own Common Shares of the Company.

One of the Standby Guarantors, Mr. Watters, is a related party to the Company under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") because Mr. Watters is an insider of the Company. The Rights Offering is not subject to the related party rules under MI 61-101 based on a prescribed exception related to rights offerings.

Use of Net Proceeds of Rights Offering

Encanto intends to use the net proceeds raised from the Rights Offering for repayment of loans advanced to complete the 2023, 2024 and 2025 Audited Financial Statements; and general working capital.

There is material uncertainty of the Company to continue as a going concern.

No U.S. Offering or Registration

This news release does not constitute an offer to sell, or the solicitation of an offer to buy securities in any jurisdiction, including the United States, other than the provinces and territories of Canada. The securities offered under the Rights Offering will not be or have not been registered under the United States Securities Act of 1933, as amended (the "US Securities Act"), or the securities laws of any state of the United States. Such securities may not be offered or sold in the United States or to, or for the account or benefit of, any U.S. Person (as defined in Regulation S of the US Securities Act) or person in the United States except in transaction exempt from or not subject to the registration requirements of the US Securities Act and applicable state securities laws.

About Encanto Potash Corp.

Encanto Potash Corp. is a publicly listed company trading on the TSX Venture Exchange as EPO.H. The company is engaged in the exploration and development of potash properties in the province of Saskatchewan. The focus is on the Muskowekan First Nation ("Muskowekan") potash minerals deposits located on the reserve lands approximately 100 km north of Regina, Saskatchewan. Encanto and Muskowekan continue to work towards developing Canada's first potash mine on a First Nations Reserve. The Company is working to advance the spirit of truth and reconciliation with the First Nations people of Canada.

For more information on the Company, please contact Glen Macdonald, President and CEO, at (604)719-8129, or visit the Company's website at www.epotash.com.

On behalf of the Board of

Encanto Potash Corp.

"Glen Macdonald"

_____________________________

Glen Macdonald

President & CEO

Email: EncantoShareholderInfo@gmail.com

The TSX Venture Exchange has neither approved nor disapproved the contents of this news release.

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 news release.

Certain statements contained herein are "forward-looking". Forward-looking statements may include, among others, statements regarding future plans, costs, objectives, economic or technical performance, or the assumptions underlying any of the foregoing. In this News Release, words such as "may", "would", "could", "will", "likely", "enable", "feel", "seek", "project", "predict", "potential", "should", "might", "objective", "believe", "expect", "propose", "anticipate", "intend", "plan", "estimate", and similar words are used to identify forward-looking statements. Forward-looking statements are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those expressed or implied, including, but not limited to: (i) the inability of the Company to obtain TSX Venture Exchange approval of this Rights Offering; ii) the inability of any or all shareholders or standby guarantors to exercise and subscribe for this Rights Offering; and (iii) other factors beyond the Company's control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, projections and estimations, there can be no assurance that these assumptions, projections or estimations are accurate. Readers, shareholders and investors are therefore cautioned not to place reliance on any forward-looking statements as the plans, assumptions, intentions or expectations upon which they are based might not occur.