CHC — AGM Information 2016

Jul 28, 2016

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CHC Healthcare Group Meeting Minutes for 2016 Annual Shareholders’ Meeting

Date: June 13th, 2016 at 09:00 a.m.

Place: 1F., No.30, Sec. 3, Xinsheng S. Rd., Da’an Dist., Taipei City 106, Taiwan (Room 103 of Howard Civil Service International House)

Attendants: CHC’s total outstanding shares are 139,733,750 shares. 84,655,306 shares were represented by the shareholders and proxies present, which amounted to 60.58% of the Company’s 139,733,750 issued and outstanding shares.

Chairman: Pei-Lin, Lee, Chairman of CHC

Recorder: Chia-Wen, Wang

In Attendance: Tien-Ying, Lee, Director

Gui-Duan, Chen, Independent Director

Geng-Wang, Laiw, Independent Director Hwai, Wang, Supervisor Guo-Dong, Lin, Supervisor Fu-Du, Chen, Supervisor

1. Commencement: The aggregate shareholdings of the shareholders and proxies present constituted a quorum. The Chairman called the meeting to order.

2. Chairman’s Address: Dear Shareholders, thank you for visiting 2016 Annual Shareholders’ Meeting of CHC. Let’s proceed according to the agenda.

3. Discussion Items

• (1). Amendment to the Company's “Articles of Incorporation”

• (Proposed by Board of Directors)

Explanation: (1). It is conducted in accordance with Presidential Decree issued on May 20, 2015 to amend Article 235, 235-1 and 240 of “Company Act”, also pursuant to the Letter No. 10402413890 issued on Jun. 11, 2015 and Letter No. 10402427800 issued on Oct. 15, 2015 by Ministry of Economic Affairs.

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  - (2). Amendment about distribution of the compensations for employees and remunerations for directors and supervisors made to the Company's “Articles of Incorporation” according to Article 235-1 of “Company Act” is approved by the Third Compensation Committee’s fourth meeting on Nov. 11, 2015.

  - (3). Please refer to Attachment 1 for relevant information. (4). Please start discussion.

• Resolution: Approved as proposed by all the shareholders present to the Meeting when the Chairman opened the inquiry.

• (2). To release the directors from non-competition restrictions (Proposed by Board of Directors)

• Explanation: (1). According to Article 209 of “Company Act”, a director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.

  • (2). In order to meet the Company’s business needs and operations development, it requests shareholders’ approval on the Meeting to release the directors from non-competition restrictions. Please refer to Attachment 2 for relevant information.

(3). Please start discussion.

  - Resolution: Approved as proposed by all the shareholders present to the Meeting when the Chairman opened the inquiry.

1. Reporting Items

2. (1). To report 2015 Business Report: Please refer to Attachment 3.

3. (2). To report Supervisor’s Report on review of 2015 audited financial reports: Please refer to Attachment 4.

4. (3). To report the distribution of the compensations for employees and remunerations for directors and supervisors of 2015

5. (4). To report the information of endorsements/guarantees in 2015: Please refer to Attachment 5.

6. (5). To report the status of Secured Convertible Bond (41642)

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5. Approval Items

• (1). 2015 Business Report and Financial Statements

• (Proposed by Board of Directors)

• Explanation: (1). The Company’s 2015 Financial Statements (including Consolidated Financial Statements) were audited by CPA, Hui-Chin, Chou Tseng and Sheng-Wei, Teng of PricewaterhouseCoopers (PwC) Taiwan. Supervisors of the Company have examined both 2015 Business Report and Financial Statements and issued Supervisor’s Report.

  • (2). For 2015 Business Report, Supervisor’s Report, Report of Independent Auditors and 2015 Financial Statements (including Consolidated Financial Statements), please refer to Attachment 3, Attachment 4 and Attachment 6.

  • (3). Please approve it.

• Resolution: Approved as proposed by all the shareholders present to the Meeting when the Chairman opened the inquiry.

• (2). Proposal for Distribution of 2015 Profits (Proposed by Board of Directors)

• Explanation: (1). The Company’s net profit after tax of 2015 is NT$ 226,517,857. After setting aside the legal reserve for NT$ 22,651,786, special reserve for NT$ 87,626,385 based on Article 41-1 of “Securities and Exchange Act” and then adding unappropriated retained earnings at the beginning of 2015 for NT$ 536,041,126, the unappropriated retained earnings for 2015 is NT$ 652,280,812. Proposal for distribution is as followed ：

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CHC Healthcare Group 2015 Earning Distribution Table

Item	Amount(NT$)	Amount(NT$)
	Subtotal	Total
Unappropriated retained earnings at the beginningof 2015		536,041,126
Add: Netprofit after tax of 2015	226,517,857
Deduct: Legal Reserve	(22,651,786)
Deduct: Special reserve	(87,626,385)
Subtotal		116,239,686
Distributable Unappropriated Retained Earnings at the end of 2015		652,280,812
Distribution Items:
Cash Dividends(NT$2.004per share)		279,964,311
Unappropriated retained earnings at the end of 2015		372,316,501

Chairman: Pei-Lin, Lee CEO: Kung-Yu, Chen CFO: Yi-Chun, Chen

• (2). 2015 Earning distribution is first distributed from earnings in 2015 that are available for distribution.

• (3). 2015 Earning distribution is based on the number of outstanding shares on Dec. 31, 2015(139,702,750 shares), and will distribute cash dividend of NT$2.004 per share. The cash dividend will be paid with calculation rounded down to the nearest one NTD (any amount under one NTD will be discarded). The remaining fraction will be incorporated into Other Income of the Company.

• (4). It requests shareholders’ approval on the Meeting that the Chairman will be authorized to adjust the dividend distribution ratio based on the actual number of outstanding shares if there is any change in number of common shares of the Company which consequently leads to a change in the ratio.

• (5). The record date and payment date for cash dividends’ payment will be decided by the Chairman as authorized by shareholders after approved on the Meeting.

• (6). Please approve it.

• Resolution: Approved as proposed by all the shareholders present to the Meeting when the Chairman opened the inquiry.

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6. Extempore Motion: None

7. Meeting Adjourned (June 13th, 2016 at 09:12 a.m.)

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CHC Healthcare Group

Comparison Table of Revised Articles of “Articles of Incorporation”

Article Before Revision		Article After Revision	Explanation
(Blank)		Article 24-1 When allocating the profit of current year (profit before tax and compensations for employees and remunerations for directors and supervisors), accumulated losses shall be first covered, and then set aside no less than 0.05% of the balance as compensations for employees and no more than 5% as remunerations for directors and supervisors. Compensations for employees and remunerations for directors and supervisors mentioned above shall be conducted after a resolution made by majority of directors present at a meeting attended by more than two thirds of directors and shall also be reported to the shareholders’ meeting. Compensations for employees shall be paid by either shares or cash. The employees to receive compensations shall include certain qualified employees from affiliate companies and the rules of distribution shall be made by the Chairman.	Newly added article in compliance with Article 235-1 of “Company Act” and Letter No. 10402427800 issued by Ministry of Economic Affairs.
Article 25 If the Company has earnings in a fiscal year, the Company shall, after paying all taxes, offsetting all prior losses, set aside a legal reserve at 10% of the earnings unless the accumulated amount of the legal reserve has reached the total authorized capital of the Company and set aside or reserving a special reserve according to relevant regulations when necessary. Any remaining amount after the abovementioned payments are made shall be distributed as followed:		Article 25 If the Company has earnings in a fiscal year, the Company shall, after paying all taxes, offsetting all prior losses, set aside a legal reserve at 10% of the earnings unless the accumulated amount of the legal reserve has reached the total authorized capital of the Company and set aside or reserving a special reserve according to relevant regulations when necessary. Any remaining amount after the abovementioned payments~~are made shall be~~ ~~distributed as followed:~~	Amend in compliance with Article 235 and 235-1 of “Company Act”.

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7	1. Compensations for employees shall be no less than 0.05% of the balance. 2. Remunerations for directors and supervisors shall be no more than 5% of the balance. 3. The balance after abovementioned payments are made, together with unappropriated retained earnings at the beginning of the fiscal year, shall be allocated as shareholders’ dividends pursuant to resolution of the shareholders’ meeting proposed by Board of Directors. The employees to receive share dividends shall include certain qualified employees from affiliate companies and the qualification of such employees is to be decided by the Chairman. Because the Company is still in its growth stage, dividend policy that the Company intends to adopt is “Balanced Dividend Policy”, dividends may be paid in both cash and shares in moderation. The cash dividend distributed annually may not be less than 20% of the total dividends. However, the actual amount of profit distribution shall be determined according to the actual amount profits of the year and capital needs of the Company in the future.		~~1. Compensations for employees shall be no less than~~ ~~0.05% of the balance.~~ ~~2. Remunerations for directors and supervisors shall be no~~ ~~more than 5% of the balance.~~ ~~3. The balance after abovementioned payments are made,~~ together with unappropriated retained earnings at the beginning of the fiscal year,shall set aside at least 50% as unappropriated retained earnings for shareholders. Proposal for Distribution shall be submitted to shareholders’meeting for approvalby Board of Directors. ~~The employees to receive share dividends shall include~~ ~~certain qualified employees from affiliate companies and~~ ~~the qualification of such employees is to be decided by the~~ ~~Chairman.~~ Because the Company is still in its growth stage, dividend policy that the Company intends to adopt is “Balanced Dividend Policy”, dividends may be paid in both cash and shares in moderation. The cash dividend distributed annually may not be less than 20% of the total dividends. However, the actual amount of profit distribution shall be determined according to the actual amount profits of the year and capital needs of the Companyin the future.
	Article 28 The Article was enacted on Nov. 25, 2009 and amended on Nov. 28, 2009 for the first time, on Jan 15, 2010 for the second time, on Feb. 10, 2010 for the third time, on Jun. 30, 2011 for the fourth time, on Jan. 6, 2012 for the fifth time, on Jun. 14, 2013 for the sixth time.		Article 28 The Article was enacted on Nov. 25, 2009 and amended on Nov. 28, 2009 for the first time, on Jan 15, 2010 for the second time, on Feb. 10, 2010 for the third time, on Jun. 30, 2011 for the fourth time, on Jan. 6, 2012 for the fifth time, on Jun. 14, 2013 for the sixth time, on Jun. 13, 2016 for the seventh time.	Amending date added.

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【 Attachment 2 】

CHC Healthcare Group

Detail List of the Directors to Be Released From Non-Competition Restrictions

Director	Restricted Position to Be Released
Independent Director Geng-Wang, Laiw	Adjunct Director of Research Department in Yee Zen General Hospital
Director Tien-Ying, Lee	Director of Swissray Healthcare Holding (H.K.) Limited

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【 Attachment 3 】

CHC Healthcare Group 2015 Business Report

Dear Shareholders,

Thank you very much for your continuous support and advice to let CHC Healthcare Group keep on growing in such competitive environment. We would like to take the opportunity to express our deepest appreciations to all the shareholders. With all the support by shareholders and efforts by employees, CHC has done a pretty good job in China markets in 2015. In the future, we will work even harder to create both customers' and shareholders' interest.

1. Operating Results of 2015

(1). Implementation of 2015 Business Plan

2015 consolidated revenue totals NT$2,395,331 thousand, which is a growth over NT$2,091,026 thousand in 2014. Mainly reason for the growth is the synergy effect of acquisition a subsidiary in 2015 has shown up. 2015 profit is NT$222,687 thousand, which decreased comparing with 2014 profit NT$263,793 thousand. Cost of acquisition the subsidiary, expenses of repurchasing unsecured convertible bond and issuing secured convertible bond are the cause of decrease in profit. Operating Results of 2015 is as followed:

NT$ Thousand

is as followed:	NT$Thousand
Item	2015
OperatingRevenue	2,395,331
Gross Profit	759,729
OperatingExpenses	389,815
OperatingIncome	369,914
Profit Before Tax	282,868
Profit for theyear	222,687

(2). Implementation of Budget

It’s unnecessary for the Company to disclose the implementation for budget because the 2015 financial forecast was not released previously.

(3). Financial Analysis

Financial Analysis
	Item	2015	2014
Capital Structure & Liquidity	Debts Ratio(%)	43.82%	38.37%
	Current Ratio(%)	377.71%	168.97%
Profitability	Return on Total Assets(%)	3.32%	4.29%
	Return on Equity (%)	4.34%	5.64%
	Net Margin(%)	9.30%	12.62%
	Basic Earnings Per Share	NT$1.73	NT$2.04

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• (4). Research and Developments Work

The Group is not in manufacturing industry, thus there is no R&D department.

1. Perspectives and Operating Strategy for 2016

2. (1). Product Development Strategy

CHC has always devoted to introducing high-end medical equipment and technology to the country in order to improve the standard of medical treatment and achieve an all-win situation for CHC, patients and medical institutions. Besides maintaining sound relationships with our world renowned manufacturers, we are also in search of new products aggressively through joining exhibitions expected to extend our product line and improve sales revenue using existing sales channels.

• (2). Market Expansion Plan

CHC has established a full-service medical management business model with medical institutions in China, in expectation of managing procedure improvement and revenue increase using our rich experience and resources operating radiation oncology departments throughout the years. These are planned to be the demo sites for business expansion in the future. The assessment of introducing radiation oncology equipments into Myanmar, Indonesia and Vietnam are constantly under process considering the lack of large medical equipment in South-East Asia. The official entering into the market has been carried out with our joint venture subsidiary in Indonesia started this Spring.

• (3). Technical Training Plan

We believe that quality service and professional employees are the biggest competing advantage of CHC Healthcare Group. We will keep recruiting and training well-qualified teammates, reproducing our profitable business model in Taiwan, no matter to cope with new product introduction or gain access to new market for maintaining high-quality service and good reputation whereas our fast expansion. We have successfully entered China market by offering our technical services, and will continue nurturing our talents to extend the service line into other territories.

• (4). Medical Services Policy

Besides rooting in Taiwan’s medical centers by providing medical service of radiation oncology and reproducing the same model into China, CHC is also eager to extend the width and depth in the field of medical service and enhances pattern of cooperation with medical institutions for the purpose of becoming a comprehensive turn-key solution provider.

Chairman: Pei-Lin, Lee CEO: Kung-Yu, Chen CFO: Yi-Chun, Chen

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【 Attachment 4 】

CHC Healthcare Group Supervisor’s Report on Review of 2015 Audited Financial Reports

TO: 2016 Annual Shareholders’ Meeting of CHC Healthcare Group

The Board of Directors reports 2015 financial statement (including Consolidated Financial Statements), and were audited by CPA, Hui-Chin, Chou Tseng and Sheng-Wei, Teng of PricewaterhouseCoopers (PwC) Taiwan, which they considered to present a fair view of the Company’s financial position, operating results and cash flows. 2015 Financial Statements, together with 2015 Business Report and Proposal for Distribution of 2015 Profits, have all been audited by us as Supervisors of the Company. We deem no inappropriateness on these documents. Pursuant to Article 219 of “Company Act”, we hereby present the Supervisor’s Report. Please review.

Supervisor: Hwai, Wang Supervisor: Fu-Du, Chen Supervisor: Guo-Dong, Lin

Mar. 24, 2016

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【 Attachment 5 】

CHC Healthcare Group Information of Endorsements/Guarantees in 2015

The Company’s information of endorsements/guarantees by Dec. 31, 2015:

1. Counterparty: Ten 100% owned subsidiaries

2. Total Amount of Endorsements/Guarantees: NT$ 6,319,812 thousand

3. Purpose of Endorsements/Guarantees: For subsidiaries’ financing needs

4. According to the net value on Dec. 31, 2015, the ceiling on total amount of the Company’s endorsements/guarantees is NT$ 15,483,738 thousand and the ceiling on amount of the Company’s endorsements/guarantees to any individual entity is NT$ 10,322,492 thousand. All endorsements/guarantees the Company made are pursuant to “Procedures for Endorsement & Guarantee” and there is no circumstance that the amount exceeds the ceiling.

Item	Counterparty	Amount (NT$ thousand)
1	Chiu Ho Medical System Co.,Ltd.	3,835,000
2	Tomorrow Medical System Co.,Ltd.	1,120,948
3	Chiu Ho Scientific Co.,Ltd.	111,000
4	J.AB BeautyCo.,Ltd.	6,000
5	Hua Lin Instruments Co.,Ltd.	175,264
6	E CenturyHealth Care Corporation	120,000
7	Tong-Lin Instruments Co., Ltd.	130,000
8	Chiu Ho Biotech Co.,Ltd.	274,000
9	CHC Healthcare(HK),Ltd.	262,600
10	Medlink Healthcare,Ltd.	285,000
	Total Amount	6,319,812

5. Subsidiaries’ information of endorsements/guarantees by Dec. 31, 2015:

Item	Provider	Counterparty	Amount (NT$ thousand)
1	Hsing-Yeh Biotechnology Co., Ltd.	CHC Healthcare Group	361,482
2	Hsing-Yeh Biotechnology Co., Ltd.	Chiu Ho Medical System Co., Ltd.	933,474
3	Hsing-Yeh Biotechnology Co., Ltd.	Medlink Healthcare, Ltd.	108,444
Total Amount			1,403,400

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【 Attachment 6 】

CPA Audit Report Translated From Chinese

PWCR15004423

To the Board of Directors and Shareholders of CHC Healthcare Group

We have audited the accompanying standalone balance sheets of CHC Healthcare Group as of December 31, 2015 and 2014, and the related standalone statements of comprehensive income, of change in equity and of cash flows for the years ended December 31, 2015 and 2014. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the “Rules Governing Examination of Financial Statements by Certified Public Accountants” and generally accepted auditing standards in the Republic of China. Those standards and rules require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provides a reasonable basis for our opinion.

In our opinion, based on our audits, the standalone financial statements referred to above present fairly, in all material respects, the financial position of CHC Healthcare Group as of December 31, 2015 and 2014, and the results of its operations and its cash flows for the years ended December 31, 2015 and 2014, in conformity with the “Rules Governing the Preparation of Financial Statements by Securities Issuers”.

PricewaterhouseCoopers, Taiwan March 24, 2016

The accompanying financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying financial statements and CPA audit report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

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CHC Healthcare Group Standalone Balance Sheet

December 31, 2015 & 2014

(Expressed in Thousands of New Taiwan Dollars)

Assets	Notes 6(1) 7 7 6(2),12(3) 6(3) 6(18) 8 12 6(5) 6(4)(6),12(3) 7 6(4)(6),12(3) 6(6) 6(7),7 6(18) 1,6(10) 6(6)(9)(11) 6(11)(12)(18) 7,9	2015/12/31	% 8 - - 2 - 10 4 86 - - - - 90 100 - - - - - - - - - - 14 12 - 26 26 20 41 3 - 11 ( 1) 74 100	2014/12/31
		Amount $ 568,774 1,806 1,527 140,941 3,601 716,649 228,632 6,028,517 4,538 17,386 4,200 2,071 6,285,344 $ 7,001,993 $ - - 2,507 5 13,875 - - 1,826 18,213 4,800 963,173 850,000 4,561 1,822,534 1,840,747 1,397,028 2,882,624 206,661 5,519 762,559 ( 93,145 ) 5,161,246 $ 7,001,993		Amount $ 77,512 4,200 - 60,224 1,135 143,071 319,753 5,285,887 5,689 2,566 - 1,125 5,615,020 $ 5,758,091 $ 70,000 10,500 2,102 - 12,451 4,100 3,892 685 103,730 - 962,714 - 4,877 967,591 1,071,321 1,303,460 2,379,917 180,084 - 828,829 ( 5,520) 4,686,770 $ 5,758,091	%
Current assets 1100 Cash and cash equivalents 1180 Accounts receivable due from related parties, net 1200 Other receivables 1210 Other receivables due from related parties 1410 Prepayments 11XX Total current assets Non-current assets 1523 Non-current available-for-sale financial assets 1550 Investments accounted for under equity method 1600 Property, plant and equipment 1840 Deferred tax assets 1980 Other non-current financial assets 1990 Other non-current assets 15XX Total non-current assets 1XXX Total assets Liabilities and Equity					1 - - 1 -
					2
					6 92 - - - -
					98
					100
					2 - - - - - - -
Current liabilities 2100 Short-term borrowings 2120 Current financial liabilities at fair value through profit or loss 2150 Notes payable 2170 Accounts payable 2200 Other payables 2220 Other payables to related parties 2230 Current tax liabilities 2399 Other current liabilities 21XX Total current liabilities Non-current liabilities 2500 Non-current financial liabilities at fair value through profit or loss 2530 Bonds payable 2540 Long-term borrowings 2570 Deferred tax liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity Share capital 3110 Ordinary share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 3XXX Total equity Significant contingent liabilities and unrecorded contract commitments 3X2X Total liabilities and equity
					2
					- 17 - -
					17
					19
					23 41 3 - 14 -
					81
					100

The accompanying notes are an integral part of the standalone financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

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CHC Healthcare Group Standalone Statements of Comprehensive Income For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars, Except Earnings Per Share Data)

Item 4000 Operating revenue 5000 Operating costs 5900 Gross profit Non-operating income and expenses 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before tax 7950 Tax income 8000 Profit from continuing operations Other comprehensive income Components of other comprehensive income that will be reclassified to profit (loss) 8361 Exchange differences on translation 8362 Unrealized losses on valuation of available-for-sale financial assets 8380 Share of other comprehensive income of subsidiaries, associates and joint ventures accounted for using equity method 8399 Tax related to components of other comprehensive income 8300 Other comprehensive income, net 8500 Total comprehensive income Basic earnings per share 9750 Total basic earnings per share Diluted earnings per share 9850 Total diluted earnings per share

2015 2014 Notes Amount % Amount % 6(13),7 $ 377,477 100 $ 368,503 100 6(8)(9)(17),7 ( 101,480) ( 27) ( 82,243)( 23) 275,997 73 286,260 77 6(14),7 4,692 1 2,270 1 6(4)(15) ( 31,238) ( 8) ( 1,014) - 6(16) ( 28,385) ( 7) ( 23,923)( 7) ( 54,931) ( 14) ( 22,667)( 6) 221,066 59 263,593 71 6(18) 5,452 1 2,173 1 226,518 60 265,766 72 ( 1,883) - 12,496 4 6(2) ( 91,121) ( 24) ( 32,049) ( 9) ( 5,877) ( 2) - - 6(18) 11,256 3 331 - ($ 87,625) ( 23) ( $ 19,222)( 5) $ 138,893 37 $ 246,544 67 6(19) $ 1.73 $ 2.04 6(19) $ 1.54 $ 2.03

The accompanying notes are an integral part of the standalone financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

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CHC Healthcare Group

Standalone Statements of Change in Equity For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars)

16	For the year ended December 31, 2014 Balance at January 1, 2014 Appropriations of 2013 earnings Legal reserve Cash dividends Exercise of employee stock options Employee stock option compensation cost Employee stock option compensation cost of subsidiary Profit for the year Other comprehensive income (loss) for the year Balance at December 31, 2014 For the year ended December 31, 2015 Balance at January 1, 2015 Appropriations of 2014 earnings Legal reserve Special reserve Cash dividends Cash capital increase Employee stock option compensation cost - cash capital increase Convertible bonds reverse sold Convertible bonds repurchased Conversion option of convertible bonds Exercise of employee stock options Employee stock option compensation cost Employee stock option compensation cost of subsidiary Profit for the year Other comprehensive income (loss) for the year Balance at December 31, 2015	Notes		Share capital – Ordinaryshare				Capital	surplus	surplus						Retained earnings				Other	eq	uity		Total equity
						Sharepremium		Treasuryshare		Employee stock option		Others		Legal reserve		Special reserve		Unappropriated retained earnings		Exchange differences on translation		Unrealized gains (losses) on valuation of available-for-sale financial assets
		6(12) 6(9) 6(12) 6(10) 6(9) 6(6) 6(9)		$ 1,300,000 - - 3,460 - - - - $ 1,303,460 $ 1,303,460 - - - 90,000 - - - - 3,568 - - - - $ 1,397,028		$ 2,238,362 - - 27,554 - - - - $ 2,265,916 $ 2,265,916 - - - 439,200 4,813 57,527 - - 27,625 - - - - $ 2,795,081		$ - - - - - - - - $ - $ - - - - - - - 173 - - - - - - $ 173		$ 44,457 - - ( 16,690 ) 8,163 20,371 - - $ 56,301 $ 56,301 - - - - ( 4,813 ) - - - ( 12,121 ) 6,141 14,262 - - $ 59,770		$ 57,700 - - - - - - - $ 57,700 $ 57,700 - - - - - ( 57,527 ) ( 173 ) 27,600 - - - - - $ 27,600		$ 150,398 29,686 - - - - - - $ 180,084 $ 180,084 26,577 - - - - - - - - - - - - $ 206,661		$ - - - - - - - - $ - $ - - 5,519 - - - - - - - - - - - $ 5,519		$ 852,749 ( 29,686 ) ( 260,000 ) - - - 265,766 - $ 828,829 $ 828,829 ( 26,577 ) ( 5,519 ) ( 260,692 ) - - - - - - - - 226,518 - $ 762,559		$ 2,115 - - - - - - 10,372 $ 12,487 $ 12,487 - - - - - - - - - - - - ( 1,562 ) $ 10,925		$ 11,587 - - - - - - ( 29,594 ) ($ 18,007 ) ($ 18,007 ) - - - - - - - - - - - - ( 86,063 ) ($ 104,070 )		$ 4,657,368 - ( 260,000 ) 14,324 8,163 20,371 265,766 ( 19,222 ) $ 4,686,770 $ 4,686,770 - - ( 260,692 ) 529,200 - - - 27,600 19,072 6,141 14,262 226,518 ( 87,625 ) $ 5,161,246

Note: Compensations for employees $980 in 2014 and $325 in 2013 and remunerations for directors and supervisors $4,800 for both 2014 and 2013 had been deducted from Statements of Comprehensive Income of the year.

Chairman: Pei-Lin, Lee

The accompanying notes are an integral part of the standalone financial statements. CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

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CHC Healthcare Group Standalone Statements of Cash Flows

For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities Profit before tax Adjustments Adjustments to reconcile profit or loss Depreciation expenses Amortization expenses Net loss on financial liabilities at fair value through profit or loss Interest expenses Interest income Employee stock option compensation cost Share of profit of subsidiaries, associates and joint ventures accounted for under equity method Discount and amortization on bonds payable Changes in operating assets and liabilities Changes in operating assets Accounts receivable due from related parties, net Other receivables Prepayments Other non-current financial assets Other non-current assets Changes in operating liabilities Notes payable Accounts payable Other payables Other payables to related parties Other current liabilities Cash inflow generated from operations Interest received Dividends received Taxes paid Interest paid Net cash provided by operating activities Cash flows from investing activities Increase (Decrease) in other receivables due from related parties Acquisition of non-current available-for-sale financial assets Acquisition of investments accounted for under equity method Proceeds from capital reduction of investments accounted for under equity method Acquisition of property, plant and equipment Increase in refundable deposits Net cash used in investing activities Cash flows from financing activities Decrease (Increase) in short-term borrowings Repayments of bonds Proceeds from issuing bonds Cost of issuing bonds Proceeds in long-term borrowings Cash dividends Cash capital increase Exercise of employee stock options Net cash provided by (used in) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period

Notes 2015 2014 $ 221,066 $ 263,593 6(17) 1,203 676 6(17) 373 246 6(4) 31,219 1,000 6(16) 12,453 372 6(14) ( 4,681 ) ( 2,268 ) 6(9) 6,141 8,163 6(13) ( 276,567 ) ( 263,503 ) 6(16) 15,932 23,551 2,394 ( 4,200 ) - 3 ( 2,466 ) 375 ( 4,200 ) - ( 1,299 ) ( 116 ) 405 72 5 - 1,354 ( 1,233 ) ( 4,100 ) 4,100 1,141( 138) 373 30,693 3,963 3,276 87,354 292,685 ( 3,849 ) ( 1,852 ) ( 12,383) ( 356) 75,458 324,446 ( 80,000 ) 114,000 6(2) - ( 312,000 ) ( 620,915 ) ( 121,973 ) 74,000 59,181 ( 52 ) ( 5,738 ) ( 19) ( 1 ) ( 626,986) ( 266,531) 6(5) ( 70,000 ) 70,000 ( 1,020,040 ) - 6(6) 1,000,000 - 6(6) ( 4,750 ) - 850,000 - 6(12) ( 260,692 ) ( 260,000 ) 6(10) 529,200 - 19,072 14,324 1,042,790( 175,676) 491,262 ( 117,761 ) 77,512 195,273 $ 568,774$ 77,512

The accompanying notes are an integral part of the standalone financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

17

CHC Healthcare Group Representation Letter

The entities that are required to be included in the combined financial statements of CHC Healthcare Group as of and for the year ended December 31, 2015, under “Criteria Governing Preparation of Affiliation Reports, Consolidated Business Reports and Consolidated Financial Statements of Affiliated Enterprises” are the same as those included in the consolidated financial statements prepared in conformity with the International Financial Reporting Standards No. 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, CHC Healthcare Group and Subsidiaries do not prepare a separate set of combined financial statements.

Very truly yours,

CHC Healthcare Group

By Pei-Lin, Lee Chairman

March 24, 2016

18

CPA Audit Report Translated From Chinese

PWCR15004408

To the Board of Directors and Shareholders of CHC Healthcare Group

We have audited the accompanying consolidated balance sheets of CHC Healthcare Group and its subsidiaries as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, of change in equity and of cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the “Rules Governing Examination of Financial Statements by Certified Public Accountants” and generally accepted auditing standards in the Republic of China. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provides a reasonable basis for our opinion.

In our opinion, based on our audits, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of CHC Healthcare Group and its subsidiaries as of December 31, 2015 and 2014, and their financial performance and their cash flows for the years then ended, in conformity with the “Rules Governing the Preparation of Financial Statements by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission(FSC).

We have also audited the standalone financial statements of CHC Healthcare Group as of and for the years ended December 31, 2015 and 2014, on which we have expressed a standard unqualified opinion on such financial statements.

PricewaterhouseCoopers, Taiwan March 24, 2016

The accompanying consolidated financial statements are not intended to present the financial position and results of operations and cash flows in accordance with accounting principles generally accepted in countries and jurisdictions other than the Republic of China. The standards, procedures and practices in the Republic of China governing the audit of such financial statements may differ from those generally accepted in countries and jurisdictions other than the Republic of China. Accordingly, the accompanying consolidated financial statements and CPA audit report are not intended for use by those who are not informed about the accounting principles or auditing standards generally accepted in Republic of China, and their applications in practice.

As the financial statements are the responsibility of the management, PricewaterhouseCoopers cannot accept any liability for the use of, or reliance on, the English translation or for any errors or misunderstandings that may derive from the translation.

19

CHC Healthcare Group And Subsidiaries Consolidated Balance Sheet

December 31, 2015 & 2014

(Expressed in Thousands of New Taiwan Dollars)

				2015/12/31			2014/12/31
	Assets	Notes		Amount	%		Amount	%
	Current assets
1100	Cash and cash equivalents	6(1)	$	1,257,833	13	$	558,333	7
1150	Notes receivable, net	6(3),8		57,592	1		104,661	2
1160	Notes receivable due from	7
	related parties, net			157,954	2		3,365	-
1170	Accounts receivable, net	6(4)		851,427	9		600,770	8
1180	Accounts receivable due from	7
	related parties, net			41,206	-		1,750	-
1200	Other receivables			1,432	-		123	-
1210	Other receivables due from	7
	related parties			2,582	-		-	-
1220	Current tax assets			5,195	-		13,172	-
130X	Inventories	6(5)(6)		327,092	3		401,576	5
1410	Prepayments	7		133,258	1		107,602	2
1470	Other current assets	8		2,902	-		22,053	-
11XX	Total current assets			2,838,473	29		1,813,405	24
	Non-current assets
1523	Non-current available-for-sale	6(2),7
	financial assets			263,353	3		361,153	5
1600	Property, plant and equipment	6(6),8		4,550,081	46		4,671,616	61
1760	Investment property, net	6(7),8		1,160,819	12		-	-
1780	Intangible assets	6(28)		161,746	1		11,129	-
1840	Deferred tax assets	6(25)		49,139	-		15,379	-
1900	Other non-current assets	6(6)(8),7,8		883,558	9		738,698	10
15XX	Total non-current assets			7,068,696	71		5,797,975	76
1XXX	Total assets		$	9,907,169	100	$	7,611,380	100

(Continued)

20

CHC Healthcare Group And Subsidiaries Consolidated Balance Sheet

December 31, 2015 & 2014

(Expressed in Thousands of New Taiwan Dollars)

Liabilities and Equity	Notes 6(9),8 6(10)(12) 6(6)(11) 7 6(6) 7 6(13) 6(10)(12) 6(12) 6(13),8 6(25) 6(14) 6(17) 6(12)(16)(18) 6(19)(25) 6(2) 9 11	2015/12/31	% 3 - 1 2 - 1 - - - 1 8 - 10 26 - - - 36 44 14 29 2 - 8 ( 1) 52 4 56 100	2014/12/31
		Amount $ 274,988 - 54,520 156,841 15,307 70,409 6,303 50,986 21,871 100,274 751,499 4,800 963,173 2,523,263 10,631 45,772 41,842 3,589,481 4,340,980 1,397,028 2,882,624 206,661 5,519 762,559 ( 93,145) 5,161,246 404,943 5,566,189 $ 9,907,169		Amount $ 650,563 10,500 22,966 89,810 10,228 63,398 - 32,984 14,414 178,342 1,073,205 - 962,714 850,921 13,966 5,025 15,005 1,847,631 2,920,836 1,303,460 2,379,917 180,084 - 828,829 ( 5,520) 4,686,770 3,774 4,690,544 $ 7,611,380	%
Current liabilities 2100 Short-term borrowings 2120 Current financial liabilities at fair value through profit or loss 2150 Notes payable 2170 Accounts payable 2180 Accounts payable to related parties 2200 Other payables 2220 Other payables to related parties 2230 Current tax liabilities 2250 Current provisions 2300 Other current liabilities 21XX Total current liabilities Non-current liabilities 2500 Non-current financial liabilities at fair value through profit or loss 2530 Bonds payable 2540 Long-term borrowings 2550 Non-current provisions 2570 Deferred tax liabilities 2600 Other non-current liabilities 25XX Total non-current liabilities 2XXX Total liabilities Equity attributable to owners of parent Share capital 3110 Ordinary share Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3320 Special reserve 3350 Unappropriated retained earnings Other equity interest 3400 Other equity interest 31XX Total equity attributable to owners of parent 36XX Non-controlling interests 3XXX Total equity Significant contingent liabilities and unrecorded contract commitments Significant subsequent events 3X2X Total liabilities and equity					9 - - 1 - 1 - 1 - 2
					14
					- 13 11 - - -
					24
					38
					17 32 2 - 11 -
					62
					-
					62
					100

The accompanying notes are an integral part of the consolidated financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

21

CHC Healthcare Group And Subsidiaries Consolidated Statements of Comprehensive Income For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars, Except Earnings Per Share Data)

Item

2015 2014 Notes Amount % Amount % 6(20)(27),7 $ 2,395,331 100 $ 2,091,026 100 6(5)(24),7 ( 1,635,602) ( 68)( 1,484,277)( 71) 759,729 32 606,749 29 6(15)(16)(24)(27) (28) ( 136,711) ( 6) ( 95,402) ( 4) ( 253,104) ( 10)( 137,901)( 7) ( 389,815) ( 16)( 233,303)( 11) 369,914 16 373,446 18 6(21) 7,656 - 7,689 1 6(6)(10)(22) ( 28,185) ( 1) ( 15,830) ( 1) 6(12)(23) ( 66,517) ( 3)( 40,897)( 2) ( 87,046) ( 4)( 49,038)( 2) 282,868 12 324,408 16 6(25) ( 60,181) ( 3)( 60,615)( 3) $ 222,687 9 $ 263,793 13 ($ 1,883) - $ 12,496 1 6(2) ( 97,800) ( 4) ( 32,049) ( 2) 6(25) 12,058 1 331 - ($ 87,625) ( 3)( $ 19,222)( 1) $ 135,062 6 $ 244,571 12 $ 226,518 9 $ 265,766 13 ($ 3,831) - ( $ 1,973) - $ 138,893 6 $ 246,544 12 ($ 3,831) - ( $ 1,973) - 6(26) $ 1.73 $ 2.04 6(26) $ 1.54 $ 2.03

4000 Operating revenue 5000 Operating costs 5950 Gross profit Operating expenses 6100 Selling expenses 6200 Administrative expenses 6000 Total operating expenses 6900 Net operating income Non-operating income and expenses 7010 Other income 7020 Other gains and losses 7050 Finance costs 7000 Total non-operating income and expenses 7900 Profit before tax 7950 Tax expense 8200 Profit Other comprehensive income Components of other comprehensive income that will be reclassified to profit (loss) 8361 Exchange differences on translation 8362 Unrealized losses on valuation of available-for-sale financial assets 8399 Tax related to components of other comprehensive income 8300 Other comprehensive income, net 8500 Total comprehensive income Profit (loss), attributable to: 8610 Owners of parent 8620 Non-controlling interests Comprehensive income attributable to: 8710 Owners of parent 8720 Non-controlling interests Basic earnings per share 9750 Total basic earnings per share Diluted earnings per share 9850 Total diluted earnings per share

The accompanying notes are an integral part of the consolidated financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

22

CHC Healthcare Group And Subsidiaries Consolidated Statements of Change in Equity For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars)

23	For the year ended December 31, 2014 Balance at January 1, 2014 Appropriations of 2013 earnings Legal reserve Cash dividends Exercise of employee stock options Employee stock option compensation cost Employee stock option compensation cost of subsidiary Profit for the year Other comprehensive income (loss) for the year Balance at December 31, 2014 For the year ended December 31, 2015 Balance at January 1, 2015 Appropriations of 2014 earnings Legal reserve Special reserve Cash dividends Cash capital increase Employee stock option compensation cost - cash capital increase Convertible bonds reverse sold Convertible bonds repurchased Conversion option of convertible bonds Exercise of employee stock options Employee stock option compensation cost Employee stock option compensation cost of subsidiary Profit for the year Other comprehensive income (loss) for the year Non-controlling interests Balance at December 31, 2015	Notes										Equityattributa	ble	to owners ofpare	nt											Non- controllinginterests		Total equity
				Share capital – Ordinaryshare				Capital surplus						R	etai	ned earnings				Other	eq	uity		Total
						Sharepremium		Treasuryshare		Employee stock option		Others		Legal reserve		Special reserve		Unappropriated retained earnings		Exchange differences on translation		Unrealized gains (losses) on valuation of available- for- sale financial assets
		6(19) 6(19) 6(17) 6(17) 6(16) 6(16)		$ 1,300,000 - - 3,460 - - - -		$ 2,238,362 - - 27,554 - - - -		$ - - - - - - - - $ - $ - - - - - - - 173 - - - - - - - $ 173		$ 44,457 - - ( 16,690 8,163 20,371 - - $ 56,301 $ 56,301 - - - - ( 4,813 - - - ( 12,121 6,141 14,262 - - - $ 59,770	) ) )	$ 57,700 - - - - - - - $ 57,700 $ 57,700 - - - - - ( 57,527 ( 173 27,600 - - - - - - $ 27,600	) )	$ 150,398 29,686 - - - - - - $ 180,084 $ 180,084 26,577 - - - - - - - - - - - - - $ 206,661		$ - - - - - - - - $ - $ - - 5,519 - - - - - - - - - - - - $ 5,519		$ 852,749 ( 29,686 ) ( 260,000 ) - - - 265,766 - $ 828,829 $ 828,829 ( 26,577 ) ( 5,519 ) ( 260,692 ) - - - - - - - - 226,518 - - $ 762,559		$ 2,115 - - - - - - 10,372 $ 12,487 $ 12,487 - - - - - - - - - - - - ( 1,562 ) - $ 10,925		$ 11,587 - - - - - - ( 29,594 ) ($ 18,007 ) ($ 18,007 ) - - - - - - - - - - - - ( 86,063 ) - ($ 104,070 )		$ 4,657,368 - ( 260,000 ) 14,324 8,163 20,371 265,766 ( 19,222 ) $ 4,686,770 $ 4,686,770 - - ( 260,692 ) 529,200 - - - 27,600 19,072 6,141 14,262 226,518 ( 87,625 ) - $ 5,161,246		$ 5,747 - - - - - ( 1,973 ) - $ 3,774 $ 3,774 - - - - - - - - - - - ( 3,831 ) - 405,000 $ 404,943		$ 4,663,115 - ( 260,000 ) 14,324 8,163 20,371 263,793 ( 19,222 ) $ 4,690,544 $ 4,690,544 - - ( 260,692 ) 529,200 - - - 27,600 19,072 6,141 14,262 222,687 ( 87,625 ) 405,000 $ 5,566,189
				$ 1,303,460		$ 2,265,916
				$ 1,303,460 - - - 90,000 - - - - 3,568 - - - - -		$ 2,265,916 - - - 439,200 4,813 57,527 - - 27,625 - - - - -
				$ 1,397,028		$ 2,795,081

The accompanying notes are an integral part of the consolidated financial statements.

Chairman: Pei-Lin, Lee

CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

23

CHC Healthcare Group And Subsidiaries Consolidated Statements of Cash Flows

For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities Profit before tax Adjustments Adjustments to reconcile profit or loss Provision for bad debt expense Depreciation expenses Loss on disposal of property, plant and equipment Interest expenses Interest income Net loss on financial liabilities at fair value through profit or loss Discount and amortization on bonds payable Employee stock option compensation cost Changes in operating assets and liabilities Changes in operating assets Notes receivable, net Notes receivable due from related parties, net Accounts receivable, net Accounts receivable due from related parties, net Other receivables Inventories Prepayments Other current assets Other non-current assets - Long-term notes and accounts receivable Changes in operating liabilities Notes payable Accounts payable Other payables Current provisions Other current liabilities Non-current provisions Other non-current liabilities Cash inflow generated from operations Interest paid Interest received Taxes paid Net cash provided by operating activities

Notes 2015 2014 $ 282,868 $ 324,408 1,894 447 6(6) 389,230 353,329 6(6) 304 3,126 56,702 23,013 6(21) ( 3,045 ) ( 1,653 ) 6(22) 31,219 1,000 6(23) 15,932 23,551 6(16) 20,403 28,534 151,674 ( 24,311 ) 7 ( 154,589 ) ( 3,365 ) ( 194,961 ) ( 86,902 ) 7 ( 42,018 ) ( 1,750 ) ( 1,309 ) 295 6(5) 116,066 ( 22,140 ) ( 25,656 ) 37,044 9,614 ( 618 ) 6(8) ( 70,760 ) 77,338 ( 17,832 ) ( 8,883 ) 62,126 ( 27,287 ) 33,027 ( 902 ) 7,457 1,519 ( 33,775 ) 45,463 ( 3,335 ) 4,857 ( 11,127 ) ( 14,129 ) 620,109 731,984 6(23) ( 55,709 ) ( 24,459 ) 3,025 1,653 ( 62,525 ) ( 74,945 ) 504,900 634,233

(Continued)

24

CHC Healthcare Group And Subsidiaries Consolidated Statements of Cash Flows For the Years Ended December 31, 2015 and 2014

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from investing activities Decrease in other current assets Acquisition of non-current available-for-sale financial assets Acquisition of property, plant and equipment Capitalize interest associated with acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Decrease in refundable deposits Increase in other non-current assets Net cash flow from acquisition of subsidiaries Net cash used in investing activities Cash flows from financing activities Increase in short-term borrowings Decrease in short-term borrowings Repayments of bonds Proceeds from issuing bonds Cost of issuing bonds Proceeds from long-term borrowings Repayments of long-term borrowings Cash dividends Increase in guarantee deposits received Cash capital increase Exercise of employee stock options Change in non-controlling interests Net cash provided by financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period

Notes 2015 2014 $ 10,158 $ 102,908 6(2) - ( 353,400 ) 6(6) ( 242,905 ) ( 871,434 ) ( 8,681 ) ( 9,678 ) 6(6) 48 1,000 6(8) ( 74,497 ) ( 128,180 ) 6(8) 57,687 101,322 ( 62,990 ) ( 78,822 ) 6(28) ( 1,134,428 ) - ( 1,455,608 ) ( 1,236,284 ) 4,063,842 2,065,114 ( 4,444,714 ) ( 2,138,468 ) ( 1,020,040 ) - 6(12) 1,000,000 - 6(12) ( 4,750 ) - 1,782,800 836,111 ( 461,123 ) ( 71,433 ) 6(19) ( 260,692 ) ( 260,000 ) 36,658 3,471 6(17) 529,200 - 19,072 14,324 405,000 - 1,645,253 449,119 4,955 6,645 699,500 ( 146,287 ) 558,333 704,620 $ 1,257,833 $ 558,333

The accompanying notes are an integral part of the consolidated financial statements.

Chairman: Pei-Lin, Lee CEO: Kung-Yu, Chen

CFO: Yi-Chun, Chen

25