Company: FSTWF
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-044386
Chunk: 166

Company: FST Corp.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 16
Chunk 166
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 control over FST’s
business and operations after the closing of Business Combination and enhance the efficiency of future fundraising, the parties intend
to have each existing FST’s shareholder exchange the company shares held by it, him or her with the Company’s ordinary shares,
so that at the closing of Business Combination, the Company will be the sole shareholder of FST. Pursuant to the Business Combination
agreement, the Company shall have acquired at least90% of all issued and outstanding FST’s ordinary shares on or prior to the closing
of Business Combination.

The Company undertook the following steps to affect
FST Restructuring:

  Formation                         

  Each                                                                                                                                        

  At                                                                                                                                    

Immediately before and after the FST Restructuring
as described above, FST Corp. together with its subsidiaries were effectively controlled by the same controlling shareholders; therefore,
the FST Restructuring was accounted for as a recapitalization.

Business Combination

On January 15, 2025 (the “ Closing Date”),
the Company completed the Business Combination, pursuant to the terms of the Business Combination agreement, FST Merger Ltd. merged with
and into Chenghe with Chenghe being the surviving company and as a direct, wholly owned subsidiary of the Company, and Chenghe changed
its name to “ FST Ltd.”.

In connection with the closing of the Business
Combination, the Company’s shares began trading on The Nasdaq Stock Market LLC (“ Nasdaq”) under the ticker symbol “ KBSX”
on January 16, 2025.

Unless the context otherwise requires, the information
below pertains to the Group, the pre-Business Combination companies since January 15, 2025. Please refer to Note 16 Subsequent Events
for further discussion of the Business Combination.

F-8

FST Corp.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In U. S. dollars, except for share and per
share data, or otherwise noted)

2. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of presentation,
principles of consolidation and going concern considerations

The accompanying consolidated financial statements
are prepared in accordance with accounting principles generally accepted in the United States of America (“ U. S. GAAP”)
and pursuant to the rules and regulations of the Securities and Exchange Commission (the “ SEC”). The accompanying consolidated
financial statements include the financial statements of the Company and its subsidiaries. All inter-company balances and transactions
are eliminated upon