【Fu Sheng Applied】Announcement of Board of Directors' Resolution to Capital Reduction to Offset Losses for Subsidiaries Gainsmart Group Ltd. and FS North America, Inc.

1. **Date of Board Resolution:** May 7, 2026 (115/05/07) 2. **Reason for Capital Reduction:** * Fu Sheng Applied (the Company) holds 100% of Gainsmart Group Ltd. ("Gainsmart"). Gainsmart, through its 100% owned grandchild company FS North America, Inc. ("FS-NA"), further holds 100% of its great-grandchild company FS-Precision Tech. Co., LLC ("PT"). Both Gainsmart and FS-NA are holding companies, with PT being the actual operating entity. * Due to the expiration of PT's land and plant lease, the Company's board of directors resolved on January 26, 2024 (113/01/26) to dissolve and liquidate PT. The liquidation and cancellation were completed on December 26, 2025 (114/12/26). Therefore, a capital reduction is now proposed for Gainsmart and FS-NA to offset accumulated losses. * The capital reduction amounts are USD 23.3 million for Gainsmart and USD 22.84 million for FS-NA. * After the capital reduction, Gainsmart's paid-in capital will be USD 2.3 million, and FS-NA's capital surplus will be USD 460,000. 3. **Amount of Capital Reduction:** Gainsmart: USD 23.3 million 4. **Shares Eliminated:** Gainsmart: 23.3 million shares 5. **Capital Reduction Ratio:** Gainsmart: 91.01% 6. **Capital After Reduction:** Gainsmart: USD 2.3 million 7. **Scheduled Date of Shareholders' Meeting:** Not applicable 8. **Expected Number of Listed Common Shares After Capital Reduction:** Not applicable 9. **Ratio of Expected Listed Common Shares After Capital Reduction to Total Outstanding Common Shares (Listed Common Shares After Reduction / Total Outstanding Common Shares After Reduction):** Not applicable 10. **Measures for Low Stock Liquidity if the Number of Listed Common Shares After Capital Reduction is Less Than 60 Million Shares and Less Than 25% for the Above Two Items:** Not applicable 11. **Effective Date of Capital Reduction:** Not applicable 12. **Other Matters to be Stated:** The Chairman is authorized to handle all subsequent related procedures and operations.