• WA Kaolin's 2026 offtake agreement with Dak Tai Trading Limited (DTT) breached ASX Listing Rule 10.1
• DTT is an associate of former non-executive director Sean Hu, who resigned in November 2025
• Company has agreed not to rely on the offtake agreement and will seek shareholder approval

WA Kaolin Ltd (ASX: WAK) has advised that, following correspondence with the ASX, the company has become aware that the ASX has indicated that it considers the company's 2026 offtake agreement with Dak Tai Trading Limited (DTT), as first announced on 31 December 2025, was executed by management in breach of ASX Listing Rule 10.1. Listing Rule 10.1 requires shareholders to approve agreements for the disposal of substantial assets to, amongst others, associates of related parties. DTT is an associate of former non-executive director Sean Hu, who resigned from the board on 21 November 2025 and is deemed to be a related party until 6 months after his resignation. The company has agreed with DTT not to rely on the offtake agreement and has suspended performance under it pending shareholder approval, which it intends to seek at a shareholder meeting by mid-May 2026. Pending the shareholder meeting, the company will continue to sell kaolin product to DTT on arm's length, ad hoc terms. The company notes that ongoing sales to DTT under the ad hoc arrangement, when aggregated with offtake sales to DTT made to this point in the calendar year, currently exceed 5% of the company's equity interests and accordingly constitute the disposal of a substantial asset for the purposes of Listing Rule 10.1. The company considers this ad hoc arrangement necessary, as a cessation of sales to DTT altogether would materially prejudice the financial condition of the company. The notice of meeting will include an independent expert's report on whether the offtake agreement is fair and reasonable to shareholders not associated with Mr Sean Hu and DTT.