Company: FSTWF
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-044386
Chunk: 134

Company: FST Corp.
Filing Date: 2025-05-15
Form: 20-F
Item: Item 10
Chunk 134
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 principles), the distribution will first be treated as a tax-free return of capital,
causing a reduction in the adjusted basis of the U. S. Holder’s ordinary shares, and to the extent the amount of the distribution
exceeds the U. S. Holder’s tax basis, the excess will be taxed as capital gain recognized on a sale or exchange as described
below under “ - Sale, Exchange, Redemption or Other Taxable Disposition of ordinary shares.” However, we
may not calculate earnings and profits in accordance with U. S. federal income tax principles. In such event, a U. S. Holder should
expect to generally treat distributions we make as dividends.

Dividends will constitute foreign
source income for foreign tax credit limitation purposes. If the dividends are taxed as qualified dividend income (as discussed above),
the amount of the dividend taken into account for purposes of calculating the foreign tax credit limitation will be limited to the gross
amount of the dividend, multiplied by the reduced rate divided by the highest rate of tax normally applicable to dividends. The limitation
on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends
distributed by us with respect to our ordinary shares will constitute “passive category income” but could, in the case of
certain U. S. Holders, constitute “general category income.”

Sale, Exchange, Redemption or Other Taxable
Disposition of the Company’s securities

Subject to the discussion below
under “ - Passive Foreign Investment Company Status,” a U. S. Holder will generally recognize gain or
loss on any sale, exchange, or other taxable disposition of ordinary shares in an amount equal to the difference between the amount realized
on the disposition and such U. S. Holder’s adjusted tax basis in such ordinary shares. Any gain or loss recognized by a U. S. Holder
on a taxable disposition of ordinary shares will generally be capital gain or loss and will be long-term capital gain or loss if
the holder’s holding period in the ordinary shares exceeds one year at the time of the disposition. Preferential tax rates may apply
to long-term capital gains of non-corporate U. S. Holders. The deductibility of capital losses is subject to limitations.
Any gain or loss recognized by a U. S. Holder on the sale or exchange of ordinary shares will generally be treated as U. S. source
gain or loss.

Exercise, lapse or redemption of Warrants

Subject to the PFIC rules discussed