Company: FSTWF
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-044386
Chunk: 137

Company: FST Corp.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 10
Chunk 137
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 S. Holders of such ordinary shares as described in “ Taxation of distributions” above. Such constructive
distribution would be subject to tax as described in that section in the same manner as if the U. S. Holders of the warrants received
a cash distribution from the Company equal to the fair market value of such increased interest.

Passive Foreign Investment Company (PFIC)
Status

Certain adverse U. S. federal
income tax consequences could apply to a U. S. Holder if we, or any of our subsidiaries, is treated as a PFIC for any taxable year
during which the U. S. Holder holds ordinary shares. A non-U. S. corporation will be classified as a PFIC for any taxable year
(a) if at least 75% of its gross income in a taxable year, including its pro rata share of the gross income of any entity in which
it is considered to own at least 25% of the interest by value, is passive income, or (b) if at least 50% of its assets in a taxable
year of the foreign corporation, ordinarily determined based on fair market value and averaged quarterly over the year, including its
pro rata share of the assets of any entity in which it is considered to own at least 25% of the interest by value, are held for the production
of, or produce, passive income. Passive income generally includes dividends, interest, rents and royalties (other than rents or royalties
derived from the active conduct of a trade or business) and gains from the disposition of passive assets.

Whether we or any of our subsidiaries
is treated as a PFIC for U. S. federal income tax purposes is a factual determination that must be made annually at the close of each
taxable year and, thus, is subject to significant uncertainty. Among other factors, fluctuations in the market price of ordinary shares
and how, and how quickly, we use liquid assets and cash obtained in the Business Combination may influence whether we or any of our subsidiaries
is treated as PFIC. Accordingly, we are unable to determine whether we or any of our subsidiaries will be treated as a PFIC for the
taxable year of the Business Combination or for future taxable years, and there can be no assurance that we or any of our subsidiaries
will not be treated as a PFIC for any taxable year. Moreover, we do not expect to provide a PFIC annual information statement for 2024
or going forward, which will preclude