Exhibit 10.48

CHINDEX MEDICAL LIMITED

AND SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2011

AND FOR THE YEAR THEN ENDED

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Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders

Chindex Medical Limited

We have audited the accompanying consolidated balance sheet of Chindex Medical Limited (the Company) as of December 31, 2011 and the related consolidated statement of operations, stockholders’ equity, and cash flows for the year 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 audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Chindex Medical Limited at December 31, 2011, and the consolidated results of its operations and its cash flows for the year then ended, in conformity with U.S. generally accepted accounting principles.

/s/ Ernst & Young Hua Ming

Beijing, PRC

March 9, 2012

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CHINDEX MEDICAL LIMITED

CONSOLIDATED BALANCE SHEET

(in thousands of U.S. Dollars except share data)

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CHINDEX MEDICAL LIMITED

CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands of U.S. Dollars)

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CHINDEX MEDICAL LIMITED

CONSOLIDATED STATEMENT OF CASH FLOWS

(in thousands of U.S. Dollars)

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

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CHINDEX MEDICAL LIMITED

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

For the Year Ended December 31, 2011

(in thousands of U.S. Dollars, except share data)

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

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CHINDEX MEDICAL LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2011

1. BACKGROUND AND ORGANIZATION

Chindex Medical Limited (“CML” or “the Company”) is a joint venture that was formed effective at the close of business on December 31, 2010, and it commenced operations on January 1, 2011. CML was formed by Shanghai Fosun Pharmaceutical (Group) Co., Ltd. (“FosunPharma”), a leading manufacturer and distributor of western and Chinese medical devices throughout China and in export markets, and by Chindex International, Inc. (“Chindex”), an American distributor of medical products and provider of healthcare services in China. FosunPharma holds a 51 percent controlling equity interest in CML, while Chindex holds a 49 percent equity interest in CML. The formation of the joint venture represents the basis of a strategic alliance between the two companies, which aims to capitalize on the long-term opportunity presented by growing medical product sectors throughout China and abroad.

Business

CML is a joint venture formed to independently operate certain medical device businesses, consisting initially of FosunPharma’s medical device companies and Chindex’s Medical Products division (“MPD”). CML is focused on marketing, distributing, selling and servicing medical devices in China and Hong Kong, as well as activities in R&D and manufacturing of medical devices for the Chinese and export markets.

The primary operating FosunPharma medical device companies contributed to the CML joint venture were:

The primary operations contributed to the CML joint venture by Chindex consisted of the former MPD division of Chindex, which included marketing, distribution, sale, and service of select medical equipment, instrumentation and products for use in hospitals in China and Hong Kong in the following areas:

The former Chindex MPD division operates from offices in the United States, Germany, China and Hong Kong. In its role as an exporter from the United States and Germany, the CML U.S. and German companies have been able, for certain contracts, to facilitate government-backed financing packages for its Chinese buyers.

In addition to the medical equipment described above, CML expects to continue to expand the breadth of its product offerings over time, by a combination of additional distribution agreements, development and manufacture of new products, and potential acquisitions or strategic investments.

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Additional information on the organization, management, products and services of the CML operating companies is available at www.chindexmedical.com.

Formation of the CML Joint Venture

On June 14, 2010, Chindex and FosunPharma entered into an agreement regarding the formation of a joint venture, with Chindex contributing its Medical Products division and FosunPhama contributing its medical device companies. The formation of the proposed joint venture, Chindex Medical Limited., was conducted through a series of definitive agreements as further described below.

Chindex Medical Limited, is a Hong Kong limited liability company that was initially formed during 2010 as a 100%-owned subsidiary of Chindex International, Inc. Chindex subsequently transferred the ownership of its legal entities included in the Chindex Medical Products Division to CML. At the close of business on December 31, 2010, the first closing (“Initial Closing”) of the formation of the joint venture was completed, in which FosunPharma acquired a 51% ownership interest in CML for its contribution of a secured note of $20 million to the joint venture, which was paid in cash in January 2011. During the period between the Initial Closing of the joint venture in December 2010 and the issuance by the Chinese government of certain amended business licenses relating to the FosunPharma-contributed businesses on June 24, 2011, CML legally controlled and operated the FosunPharma medical device companies under an Entrustment Agreement.

At the time of the Initial Closing, CML was the owner of the Chindex-contributed businesses (MPD), but not the FosunPharma-contributed businesses. On August 30, 2011, following the payment by CML of the purchase price for the FosunPharma-contributed businesses, CML became the holder of legal title to the FosunPharma-contributed businesses. Notwithstanding this transfer and payment, the registration with and approval of State Administration of Foreign Exchange (“SAFE”) was required in order for CML to obtain certain of the rights and benefits as shareholder of such businesses, including the right to receive dividends declared by the FosunPharma-contributed businesses or the proceeds of the sale of a company included in the FosunPharma-contributed businesses. Until such registration was received on March 7, 2012, CML was entitled to such benefits on a contractual basis under the Entrustment Agreement and other agreements relating to the joint venture. Following and based on the receipt of such registration on March 7, 2012, CML is entitled to such benefits as a matter of Chinese law as the registered owner of the FosunPharma-contributed businesses.

As of December 31, 2010, CML owned the Chindex-contributed businesses (principally MPD) and was entitled to a pending and obligatory final investiture of the FosunPharma-contributed businesses. The FosunPharma-contributed businesses were segregated and, until the issuance of the amended business licenses on June 24, 2011, were operated and managed by the joint venture under the Entrustment Agreement. As of December 31, 2011, CML owns, operates and manages both the Chindex-contributed businesses and the FosunPharma-contributed businesses and is entitled to full management rights with respect to both the Chindex-contributed businesses and the FosunPharma-contributed businesses. Upon the completion of the registration with and approval of SAFE, CML became entitled under Chinese law to receive dividends from and proceeds of any sale of the FosunPharma-contributed businesses without regard to the Entrustment Agreement. It is expected that the formal closing with respect to the investiture of the FosunPharma-contributed businesses will occur and the Entrustment Agreement will terminate in the first or second quarter of 2012.

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The joint venture arrangement provides that FosunPharma has a 51% controlling voting interest, a majority of the Board of Directors, certain key management roles, and other powers. Accordingly, FosunPharma has a controlling financial interest in CML. Given that FosunPharma is the controlling stockholder of the Company, the transfer of FosunPharma-contributed businesses was accounted for as a transaction between entities under common control, with the net assets carried over at historical costs and reflected in the historical financial statements of the Company. The net assets related to the Chindex-contributed businesses were recorded at fair value upon formation of the joint venture on December 31, 2010 because the transaction resulted in a change in control of the Chindex-contributed businesses. The fair value of the net assets of MPD as of December 31, 2010 were as follows (in thousands of U.S. Dollars):

Trademark License

The Company was granted the right to use the “Chindex” name which is utilized in the name of the joint venture, together with related trademarks. The brand name and trademarks are owned by Chindex, which has granted a perpetual license to the Company to use the brand name and trademark. The trademark license was recognized as an intangible asset upon the formation of the Company and has been recognized at its estimated fair value of $4,457,000. The license does not require the payment of a royalty fee unless Chindex’s interest in the Company is reduced below 30%. Since the license is non-exclusive and terminates only upon (1) bankruptcy of the Company; (2) violation of the terms of the license agreement; (3) breach of the minority rights provisions in the Joint Venture Governance and Shareholders Agreement (the “Shareholders Agreement”); or (4) the liquidation or dissolution of the Company, the Company believes that the license would be viewed as a perpetual license as the Company does not have the unilateral ability to terminate the license. Thus, the intangible asset has an indefinite life for accounting purposes, and, accordingly, will not be amortized but will be subject to periodic reviews for potential impairment.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Use of Estimates

The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”).

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The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions reflected in the Company’s financial statements include, but are not limited to, revenue recognition including estimates of selling prices for allocations of multiple-deliverable contracts, allowance for doubtful accounts, useful lives of property, plant and equipment, inventory obsolescence, accrued expenses, deferred tax valuation allowances, and the valuation of the Company’s acquired tangible and intangible assets. Actual results could materially differ from those estimates.

Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries. The Company does not have interests in variable interest entities. All intercompany balances and transactions are eliminated upon consolidation. Entities in which the Company has less than a 50 percent ownership interest in, or does not have a controlling financial interest, but is considered to have significant influence are accounted for using the equity method.

Foreign Currency Translation and Transactions

The Company’s subsidiaries determine their functional currencies to be the Chinese Renminbi (“RMB”), HongKong Dollar (“HKD”) or Euros (“Euro”) based on the criteria of ASC subtopic 830-10, Foreign Currency Matters, Overall. The Company has elected to use the US dollar (“USD”) as its reporting currency. The Company uses the monthly average exchange rate for the year and the exchange rate at the balance sheet date to translate the operating results and financial position, respectively. Translation differences are recorded in accumulated other comprehensive income, a component of shareholders’ equity.

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Foreign currency denominated financial assets and liabilities are remeasured at the exchange rates prevailing at the balance sheet date. Exchange gains and losses are included in the consolidated statement of operations.

Cash and Cash Equivalents

The Company considers unrestricted cash on hand, deposits in banks, certificates of deposit, money market funds and short-term marketable securities with an original or remaining maturity at the date of acquisition of three months or less to be cash and cash equivalents.

Restricted Cash

Short-term and long-term restricted cash represent collateral required to be maintained pursuant to certain contractual financing arrangements the Company has entered into with certain financial institutions. Restricted cash is not immediately available to the Company to meet its liquidity requirements (see Note 9).

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Accounts Receivable and Allowance for Doubtful Accounts

The Company considers many factors in assessing the collectibility of its receivables due from its customers, such as age of the amounts due, the customer’s payment history, and credit-worthiness. An allowance for doubtful accounts is recorded in the period in which collection of the amount is no longer considered probable. Accounts receivable balances are written off after all collection efforts have ceased.

Prepaid Land Use Rights

Prepaid land use rights represent amounts paid for the right to use land in the People’s Republic of China (“PRC”) and are recorded at purchase cost less accumulated amortization. Amortization is recorded on a straight-line basis over the term of the land use rights agreement.

Acquired Intangible Assets and Impairment Testing of Long-Lived Assets and Intangibles

Acquired intangible assets consist of the acquisition of the rights to use the Chindex brand name and trademarks. The asset consists of a perpetual license and was recorded at fair value at the inception of the CML joint venture, which was also the date of acquiring control of CML. This intangible asset is not amortized, but is subject to impairment testing. No impairment charge has been recognized in 2011, as management did not believe that any events or circumstances in 2011 indicated that the carrying amount of the assets might not be fully recoverable.

The Company evaluates its long-lived assets or asset group including acquired intangibles with finite lives for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying amount of a group of long-lived assets may not be fully recoverable. When these events occur, the Company evaluates the impairment by comparing the carrying amount of the assets to future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the assets, the Company recognizes an impairment loss based on the excess of the carrying amount of the asset group over its fair value, generally based upon discounted cash flows. No impairment charge has been recognized in 2011, as management did not believe that any events or circumstances in 2011 indicated that the carrying amount of the assets might not be fully recoverable.

Revenue Recognition

The Company earns revenue primarily from sales of products used in healthcare services. In recognizing revenue, the Company follows the four principles of Staff Accounting Bulletin No. 104, Revenue Recognition. Revenue from product sales is recognized when the title and risk of ownership has been transferred, provided that persuasive evidence of an arrangement exists, the selling price is fixed or determinable, collectability is reasonably assured and the remaining obligations are insignificant, and not essential to functionality of the already delivered items.

The evidence of an arrangement generally consists of an approved customer contract and purchase order. Transfer of title and risk of ownership most often occurs when the product is shipped to the customer or less frequently when the customer receives the product. The selling price for all sales are fixed and agreed to with the customer in advance prior to shipment and are based on established price lists or agreed quotes. The Company’s customers have no return rights or post-sale rights, other than limited warranty privileges.

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Revenue related to the sale of medical equipment, instrumentation and products to customers in China is recognized upon product shipment or, in certain cases, upon installation and/or acceptance by the end user when installation and/or customer acceptance is deemed as substantive. Revenue from sales to customers in Hong Kong is recognized upon delivery. We provide installation, standard warranty, and training services for certain of our medical equipment and instrumentation sales. These services are viewed as perfunctory to the overall arrangement and are not accounted for separately from the equipment sale except in the case of certain complex surgical systems where installation is considered essential to the functionality of the equipment, in which case, revenue is recognized upon the completion of the installation and receipt of customer acceptance. Costs associated with installation, training and standard warranty are not significant and are recognized in cost of sales as they are incurred. Revenue from the sale of extended warranties is deferred and recognized over the warranty period.

From time to time, the Company sells an extended warranty together with the medical equipment. The Company also sells multiple medical equipment and instrumentation and products together which are delivered over a period of time. Such arrangements are treated as multiple-element arrangements with revenue being allocated to each unit of accounting using relative fair value method in accordance with ASC 605-25, Multiple-Element Arrangements and recognized under the guidelines of Staff Accounting Bulletin (SAB) No. 104, Revenue Recognition.

On January 1, 2011, the Company adopted ASU 2009-13 issued by the Financial Accounting Standards Board for revenue arrangements with multiple-elements. The Company adopted this guidance on a prospective basis applicable for transactions originating or materially modified after the date of adoption. This guidance changed the criteria for separating units of accounting in multiple-element arrangements and the way in which an entity is required to allocate revenue to these units of accounting. Revenue is allocated to each unit of accounting on a relative fair value basis based on a selling price hierarchy. The selling price for a deliverable is based on its vendor-specific objective evidence (“VSOE”) if available, third party evidence (“TPE”) if VSOE is not available, or best estimate of selling price (“BESP”) if neither VSOE nor TPE is available. The Company determines VSOE primarily by considering the historical analysis of stand alone sales contract for the products where it is the vendor. The Company determines TPE primarily through use of market stand alone selling price evidence obtained from the OEM of the products being valued. The Company determines BESP by considering multiple factors including but not limited to, competitive and market conditions, internal costs, gross margin objectives and pricing practices. After considering all of these factors, BESP is established using a cost-plus margin approach.

Additionally, the Company evaluates revenue from the sale of equipment and products in accordance with the provisions of ASC 605-45, Principal Agent Considerations, to determine whether such revenue should be recognized on a gross or a net basis. Pursuant to ASC 605-45, the Company recorded the gross amount of sales as revenue because the Company is the primary obligor in the arrangement, the Company has credit and inventory risk and the Company has latitude in establishing its own selling price. If the Company serves as only an agent providing logistics services, it recognizes revenue on a net basis. For the year ended December 31, 2011, the Company has recognized revenue of approximately $511,000, on a net basis for its sales to a related party (see Note 17) as the Company is not the primary obligor in these sales arrangements.

Shipping costs charged to customers are included in revenues and the associated expense is included in cost of revenues in the consolidated Statement of Operations. Shipping costs charged to customers are not significant for the periods presented.

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Sales of medical equipment often require protracted sales efforts, long lead times, contingent on customers qualifying for suitable external financing arrangements, and other time-consuming steps. As a result of these factors impacting the timing of orders and related revenues, and therefore our operating results are expected to vary from period to period and year to year.

Deferred Revenue and Warranties

The Company provides its customers with the option to purchase an extended warranty on certain equipment that it sells. We determine the deferred revenue depending on whether the warranty is sold on a stand-alone basis or whether it is sold as part of a multiple deliverable arrangement. For stand alone sales of an extended warranty, the deferred revenue is amortized on a straight-line basis over the warranty term. In multiple deliverable arrangements, in which a customer purchases the equipment and an extended warranty, the deferred revenue related to the warranty is determined based on relative selling prices, and the deferred revenue is amortized on a straight line basis over the warranty term.

Inventories

Inventories include raw materials, work in progress, and finished goods, including those purchased to fill executed sales contracts, consignments and items that were stocked for future sales, including sales demonstration units and service parts. Inventory is recorded at its actual cost when obtained, and a monthly weighted average cost method is used for inventory on hand or issued from inventory. At the end of each period, the inventory is recorded at the lower of net realizable value and its historical cost. If the net realizable value is less than the cost, the difference is charged to an inventory valuation reserve. Inventory valuation is reviewed on a quarterly basis, and adjustments are charged to the provision for inventory, which is a component of cost of revenues. Demonstration inventories are depreciated over their useful life of five years.

Property and Equipment

Property and equipment are stated at historical cost. The costs of additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred. Depreciation is computed on the straight line method over the estimated useful lives of the related assets. Buildings are depreciated over 40 years. Useful lives for office equipment, vehicles and furniture and fixtures range from 5 to 7 years. Leasehold improvements are amortized on the straight-line method over the shorter of the estimated useful lives of the improvements or the lease term.

Property, plant and equipment that are purchased or constructed which require a period of time before the assets are ready for their intended use are accounted for as construction-in-progress. Construction-in-progress is recorded at acquisition cost, including installation costs and associated interest costs. Construction-in-progress is transferred to specific property and equipment accounts and commences depreciation when these assets are ready for their intended use. The capitalization of interest costs, if any, commences when expenditures for the asset have been made, activities that are necessary to get the asset ready for its intended use are in progress and interest cost is being incurred. The capitalization period ends when the asset is substantially complete and ready for its intended use.

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The Company assesses the impairment of long-lived assets when indicators of impairment are identified. The Company records impairment charges based upon the difference between the fair value and carrying value of the original asset when undiscounted cash flows indicate the carrying value will not be recovered. No impairment losses have been recorded in the accompanying consolidated Statement of Operations.

Income Taxes

The Company’s provision for income taxes is computed for each entity in the consolidated group at applicable statutory rates based upon each entity’s income or loss, giving effect to temporary and permanent differences.

In accordance with ASC 740, Income Taxes, provisions for income taxes are based upon earnings reported for financial statement purposes and may differ from amounts currently payable or receivable because certain amounts may be recognized for financial reporting purposes in different periods than they are for income tax purposes. Deferred income taxes result from temporary differences between the financial statement amounts of assets and liabilities and their respective tax bases. A valuation allowance reduces the net deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company recognizes, in its consolidated financial statements, the impact of a tax position if that position is not more likely than not to be sustained upon examination, based on the technical merits of the position. It is our policy to recognize interest and penalties related to income tax matters provision for income taxes.

Stock-Based Compensation

CML does not grant stock options or provide any other share-based payments to its employees. However, in cases where employees of Chindex provide services to CML, the services agreement between CML and Chindex provides that certain compensation costs (including monetary and nonmonetary) of the specific Chindex employees will be charged to CML, which will include the cost of stock-based compensation on a noncash basis, if applicable. In addition, certain former Chindex employees that are now employees of CML retained options to purchase Chindex’s common stock. These options are remeasured to fair value at each reporting date with an adjustment for fair value recorded to the current period expense in order to properly reflect the cumulative expense based on the current fair value of the vested awards over the vesting periods. These costs are recorded in the Company’s consolidated statement of operations as selling, general and administrative expenses with a corresponding credit to additional paid-in capital.

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standard Board (“FASB”) issued ASU No. 2011-05, Presentation of Comprehensive Income, ASU 2011-05 which eliminates the current option to report other comprehensive income (OCI) and its components in the statement of changes in stockholders’ equity. This guidance is effective for the Company’s interim and annual periods after December 15, 2011. For nonpublic entities, the amendments are effective for fiscal years ending after December 15, 2012, and interim and annual periods thereafter, with early adoption permitted. The Company will early adopted ASU 2011-05 effective for the reporting period ending on December 31, 2012. This adoption will not have an impact on the Company’s financial position, results of operations or cash flows as it only requires a change in the format of the Company’s current presentation.

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3. INVESTMENTS

The Company’s current investments as of December 31, 2011 include available-for-sale securities at fair value of $2,162,000 of government bonds, with fixed interest rate of 0.02% issued by M&T Bank, a large U.S. financial institution. The Company’s current investments are recorded at fair value, and the difference between fair value and amortized cost as of December 31, 2011 was de minimis.

4. ACCOUNTS RECEIVABLE

(in thousands of U.S. Dollars)

CML facilitates government-secured sales contracts to help hospitals in China finance their purchases of medical equipment. CML serves as a facilitator only, it does not borrow or loan money related to these projects and it does not guarantee any of the government-secured financing. In the past, such financing has included loans and loan guarantees from the U.S. Export-Import Bank and the German KfW Development Bank as well as commercial financing that was guaranteed by the Chinese Government but without foreign government participation.

5. INVENTORIES, NET

(in thousands of U.S. Dollars)

During the year ended December 31, 2011, the Company recognized $508,000 in expense for inventory valuation, which included amortization of demonstration inventory and provisions for obsolete or slow-moving inventories.

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6. INVESTMENT IN UNCONSOLIDATED AFFILIATE

As of January 1, 2011, investment in unconsolidated affiliates consisted of a 66.67 percent interest in Suzhou Qitian, a small manufacturing company in China. In March 2011, the Company sold a 35 percent interest in Qitian to a third party for consideration of RMB2,100,000, thereby reducing its ownership interest in Qitian to 31.67 percent. As a result of the disposition, the Company no longer had control of Qitian. Accordingly, Qitian was deconsolidated and is now accounted for using the equity method. The gain or loss resulted from the deconsolidation of Qitian was inconsequential. As of December 31, 2011, the investment in Qitian was approximately $330,000, and net income recorded using the equity method accounting by CML for its interest in Qitian was $2,000.

7. PROPERTY AND EQUIPMENT, NET

(in thousands of U.S. Dollars)

Construction in progress relates to development projects underway in the Dental subsidiaries in China. There was no capitalized interest recorded in the period, as the amount would have been immaterial.

Depreciation and amortization expense for property and equipment for the year ended December 31, 2011 was $877,000.

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8. PREPAID LAND USE RIGHTS AND OTHER ASSETS

(in thousands of U.S. Dollars)

The prepaid land use rights for Shanghai Transfusion Technology are for land located in Shanghai. The purchase cost was $780,000, which is being amortized over 48 years on a straight-line basis.

The prepaid land use rights for Huaiyin are for land located in Jiangsu province, for its manufacturing operations. The purchase cost was $439,000, which is being amortized over 50 years on a straight-line basis.

Other assets are primarily composed of security deposits in the amount of approximately $608,000.

9. DEBT

The Company’s short-term and long-term debt balances are (in thousands):

Bank loan

For STT, the company has a loan from Bank of China for RMB 12 million ($1,905,000) with an interest rate of 6.56% per annum which is collateralized by the five company buildings, and the term of the loan is from August 19, 2011 to August 18, 2012.

Line of credit

CML has a $1,750,000 credit facility with M&T Bank. The borrowings under that credit facility bear interest at 1.00% over the three-month London Interbank Offered Rate (LIBOR). As of December 31, 2011, there was a $482,000 outstanding loan balance under the facility. Balances outstanding under the facility are payable on demand, fully secured and collateralized by government securities acceptable to the Bank having an aggregate fair market value of not less than $1,945,000. As of December 31, 2011, there were $51,000 letters of credit outstanding.

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Debt Payments Schedule and Restricted Cash

The following table sets forth the Company’s debt obligations as of December 31, 2011:

(in thousands of U.S. Dollars)

Restricted cash of $1,409,000 as of December 31, 2011, consists of $1,397,000 for collateral for performance bonds issued in connection with the excution of certain contracts for the supply of medical equipment. Such bonds are fully collateralized and are required to be effective for the duration of the product warranty period under the applicable contracts.

10. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following:

(in thousands of U.S. Dollars)

11. DEFERRED REVENUE

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12. STOCKHOLDERS’ EQUITY

Ordinary Stock and Stockholders’ Agreement

CML was incorporated as a limited liability company under the Hong Kong Companies Ordinance. The authorized capital is HK$200 million divided into two classes, designated as 10 million “A” ordinary shares of HK$10 each and 10 million “B” ordinary shares of HK$10 each. As of December 31, 2011, 7,650,000 Class A ordinary shares and 7,350,000 Class B ordinary shares have been issued and are outstanding. The Class A shares have been issued to Ample Up Limited, a Hong Kong subsidiary of FosunPharma. The Class B ordinary shares have been issued to Chindex Medical Holdings (BVI) Limited, a subsidiary of Chindex, The rights and power of the shareholders are enumerated in the stockholders’ agreement. The Class A shares and Class B shares have equal voting rights with each share having one vote and equal economic rights in matters of dividend distribution and liquidation.

Entrustment Agreement

From January 1, 2011 until June 24, 2011, the FosunPharma-contributed businesses were managed by CML under the Entrustment Agreement (see Note 1).

Noncontrolling Interests

As of December 31, 2011, all of the subsidiaries of CML are wholly owned, with the exception of one dental subsidiary which is 90% owned. During January 2011, the Company purchased the 46% noncontrolling interest in STT for $6.1 million which increased its ownership percentage to 100%. As of December 31, 2010, CML owned a 66.67% interest in Suzhou Qitian. In March 2011, CML sold a 35% ownership interest in Suzhou Qitian, reducing its ownership interest to 31.67%. Since the ownership interest of CML in Suzhou Qitian was reduced below 50%, Suzhou Qitian was deconsolidated, and the related noncontrolling interest was eliminated from the CML consolidated financial statements.

Stock-Based Compensation

On December 31, 2010, CML was formed. In connection with the transaction, certain employees of the Chindex became employees of CML. Those individuals that transferred to CML retained 101,239 options to acquire Chindex’s common stock, of which 62,353 options were vested and 38,886 were nonvested stock options previously issued by Chindex. These costs are recorded in the Company’s consolidated statement of operations as selling, general and administrative expenses

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with a corresponding credit to additional paid-in capital. In addition, certain Chindex employees provide services to the Company under a services agreement between the Company and Chindex. A portion of their costs, including stock-based compensation is charged to the Company. For the year ended December 31, 2011, stock-based compensation charged to CML by Chindex International, Inc. was $1,224,000. This amount consists of approximately $913,000 for services provided by Chindex International, Inc. employees under a services agreement with CML and approximately $311,000 for services provided directly by CML employees.

13. INCOME TAXES

Income before income taxes for the year ended December 31, 2011 was composed of the following (in thousands of U.S. Dollars):

For the year ended December 31, 2011, the provision for income taxes consists of the following (in thousands):

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For the year ended December 31, 2011, the provision for income taxes differs from the amount computed by applying the PRC statutory income tax rate to the Company’s income from operations before income taxes as follows:

Deferred income taxes reflect the net tax effects of the temporary differences between the carrying amounts of the Company’s assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities are as follows as of December 31, 2011 (in thousands of U.S. Dollars):

The Company has losses from China of which approximately $2.7 million will expire between 2012 and 2016.

Management assessed the realization of its deferred tax assets throughout each of the quarters of the twelve month period ended December 31, 2011. Management records a valuation allowance when it determines based on available positive and negative evidence, that it is more likely than not that some portion or all of its deferred tax assets will not be realized. The valuation allowance as of December 31, 2011 was $1,855,000.

The new PRC Corporate Income Tax Law published in 2007 imposes a 10% withholding income tax, subject to reduction based on tax treaty where applicable, for dividends distributed by a foreign invested enterprise to its immediate holding company outside China. Such dividends were exempted from PRC tax under the previous income tax law and regulations. The foreign invested enterprise will be subject to the withholding tax starting from January 1, 2008.

As of December 31, 2011, the Group intended to reinvest permanently the retained earnings of its PRC subsidiaries. The amount of unrecognized deferred tax liabilities for temporary differences related to investments in foreign subsidiaries is not determined because such a determination is not practicable.

The Company’s tax expense reflects the impact of varying tax rates in the different jurisdictions in which it operates. It also includes changes to the valuation allowance as a result of management’s judgments and estimates concerning projections of domestic and foreign profitability and the extent of the utilization of net operating loss carry forwards. As a result, we have experienced significant fluctuations in our world-wide effective tax rate. Changes in the estimated level of annual pre-tax income, changes in tax laws particularly related to the utilization of net operating losses in various jurisdictions, and changes resulting from tax audits can all affect the overall effective income tax rate which, in turn, impacts the overall level of income tax expense and net income.

For the foreign jurisdictions, the Company is no longer subject to local examinations by the tax authorities for years prior to 2006.

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As of December 31, 2011, the Company had no unrecognized tax benefits, nor did it have any that would have an effect on the effective tax rate. The Company’s policy is that it would recognize interest and penalties accrued on any unrecognized tax benefits as a component of provision for income taxes. As of December 31, 2011, the Company had no accrued interest or penalties related to uncertain tax positions.

14. COMMITMENTS

Leases

CML and its subsidiaries lease office space and space for distribution and manufacturing operations under operating leases. Future minimum payments under these noncancelable operating leases as of December 31, 2011, consist of the following: (in thousands):

Rental expense was approximately $1,779,000 for the year ended December 31, 2011.

15. FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company adopted ASC 820, which defines fair value, establishes a framework and gives guidance regarding the methods used for measuring fair value, and expands disclosures about fair value measurements. It clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level 3) unobservable inputs in which there is little or no market data, which require us to develop our own assumptions. This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value.

The valuations of the investment securities are obtained from a financial institution that trades in similar securities.

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The following table presents the balances of investment securities as of December 31, 2011 measured at fair value on a recurring basis by level (in thousands of dollars):

The carrying amounts reported in the consolidated balance sheet for cash and cash equivalents, accounts receivable, accounts payable, and short-term loans approximate fair value because of the short-term maturity of these instruments.

16. CONCENTRATIONS OF RISK

Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivables. Substantially all of the Company’s cash and cash equivalents and restricted cash of $24.4 million at December 31, 2011 were held by ten Chinese banks and three international banks.

Supplier Risk

Supplier relationships which potentially subject the Company to concentrations of supplier risk consist primarily of relationships where supply of raw materials may be in short supply or controlled by a limited number of channels, pricing for commodity products subject to market fluctuations or technologies critical to the Company’s business are substantially controlled by one supplier with whom the Company has an exclusive, or restrictive, distribution rights. The Company has one significant supplier, Siemens, which accounted for 36% of total product cost of goods sold.

Currency Convertibility Risk

Some of the Company’s operating activities are transacted in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People’s Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People’s Bank of China. Approval of foreign currency payments by the People’s Bank of China or other regulatory institutions requires submitting a payment application form together with suppliers’ invoices, shipping documents and signed contracts.

Foreign Currency Exchange Rate Risk

The functional currency of certain entities of the Company is RMB, and the reporting currency is USD. Since July 21, 2005, RMB has been permitted by the PRC government to fluctuate within a managed band against a basket of certain foreign currencies. The depreciation of the USD against RMB was 4.9% during the year ended December 31, 2011. Any significant revaluation of RMB may materially and adversely affect the cash flows, operating results and financial position of the Company.

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17. RELATED PARTY TRANSACTIONS

CML is owned by two investors, FosunPharma and Chindex International, Inc. CML completed its first year of operations in 2011, and it has used certain resources available from its two owners, as detailed below.

Services Agreement

CML and Chindex entered into a services agreement, effective on January 1, 2011. Under the services agreement, Chindex provides advisory and support services as requested by CML. The services include management and administrative support services for marketing, sales and order fulfillment activities conducted in the United States and China, order processing and exporting of goods sold to customers in China, assistance with respect to the marketing of products sold in China by CML, analysis of sales opportunities and other assistance including services such as payroll, database administration, internal auditing, accounting and finance that will assist CML in carrying out its activities in the United States and China. In 2011, the service expenses charged by Chindex to CML were $3,451,000.

Lease Agreements with Related Parties

CML leases office space in Beijing from a real estate company affiliated with FosunPharma. Rent expense for this building was $579,000 in 2011.

Transactions with Affiliates and Balances to/from Affiliates

Transactions with affiliated companies outside CML in 2011 was as follows:

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Balances with affiliated companies as of December 31, 2011 were as follows:

18. SUBSEQUENT EVENTS

Subsequent events have been evaluated through March 9, 2012, which was also the date that the financial statements were available to be issued, and there were no subsequent events requiring disclosure.

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