CompanyAnnouncement

Thursday31May2018

CompumedicsSignsMajorStrategicPartnershipDealwithChina-

basedHealth100forSomfitSleepTechnology

• CompumedicstoenterJointVenturewithHealth100–aleadingChina-basedpremiumhealth-checkorganisation

• FrameworkAgreementsignedwith90daystoexecuteProposedJointVenture(PJV)and

associatedAgreements• CompumedicstoreceiveA$11.3m(US$8.45m)pre-taxpayment:A$8.0m(US$6.0m)will

gotoCompumedicsfortheSomfitproductplatformandintellectualpropertyrightsfortheGreaterChinaregion,andA$3.3m(US$2.45m)willremaininthePJV

• Health100willpurchase1millionSomfitdevicesfromthePJVovertwoyears,fromwhen

theSomfitdeviceachievesChinaFoodandDrugAdministration(CFDA)approval

• AnticipatedrevenuefromHealth100purchaseagreementtothePJVofatleastA$133m(US$100m)overfirsttwoyears

CompumedicsLimited(ASX:CMP)(“Compumedics”or“Company”) ispleasedtoannouncethatithasentered into a Framework Agreement with leading China-based health-check organisation,MeinianOnehealth Healthcare Holdings Co., Ltd. (“Health 100”) to work together over the next 90 days tofinalise the Proposed Joint Venture (PJV) into a Formal Joint Venture (FJV) Agreement and othersupportingAgreementstoenablebothcompaniestocommercialisetheSomfitproductandtechnologyplatforminChina.F

or p

erso

nal u

se o

nly

Photo: Mr Tim Dillon (Victorian Government Greater China Commissioner), Dr. Rong Yu (Chairman,Health 100) , Premier Daniel Andrews (Premier of Victoria, Australia) and Dr. David Burton(Chairman/CEO, Compumedics Limited) at ceremonial signing of PJV between Health 100 andCompumedicsLimitedSomfit is Compumedics’ mobile wearable system and platform for the monitoring of sleep in aconsumer/communityenvironment.ThekeypointsofthePJVare:

1. Compumedicswillownapproximately49%andHealth100willownapproximately51%ofthePJV.

2. Compumedicswill receiveanA$11.3m(US$8.45m)pre-taxpaymentasanupfrontpayment in

partforprovidingthePJVwiththeSomfit-relatedintellectualpropertyandtechnologyrightsfortheGreaterChinaregion.

3. Health100willcommittopurchasinganinitial1millionSomfitdevicesfortheChinamarketin

the first two years following the Somfit device receiving China Food andDrugAdministration(CFDA)approval.ThissalewillgenerateatleastA$133m(US$100m)revenuetothePJVoverthisperiod.

ItistheintentofbothpartiestoexecuteformalagreementstoestablishthePJVnolaterthanThursday,16August2018.Bothpartieswillworkover thisperiod to completeall legal arrangements, includingpaymentofthefundsnoted,andtoformaliseandestablishtheFJV.

For

per

sona

l use

onl

y

DrDavidBurton,ChairmanandCEOofCompumedics,said:“CompumedicsisverypleasedtobetakingthissignificantandtransformativestepforwardwithHealth100.“We are also honoured that the Premier of Victoria, the Hon. Daniel Andrews MP, and Victoria’sCommissioner to China,Mr TimDillon, have attended today’s signing ceremony betweenHealth 100Chairman,DrRongYu,andmyself,onbehalfofCompumedicsLimited.“Today’spartnershipannouncementcomesafteranintroductionresultingfromthePremier’s2017visitto China. This announcement marks the commencement of substantial and reciprocal trade andinvestmentbetweenVictoriaandChina,particularlyasitrelatestopositivehealth-caretransformationandassociatedknowledge-basedjob-generation.“CompumedicsandHealth100havebeenindiscussionsforsometimenowaboutthewaybothparties,togetherwiththeSomfitproductandtechnologyplatform,cantransformsleepandbrainhealthcareinChina.“ThesigningoftheFrameworkAgreementisthefirstformalstepalongthepathtoestablishingtheJointVenture and commencing the commercialisation of the Somfit product and technology platform inChina.“Getting to this point has taken Compumedics 30 years of product and technology innovation anddevelopment,andtogetherwithHealth100,wewillmakehistorytransforminghealthandleadingthewayofthefutureforprimary,secondaryandtertiarycommunity-widehealthcare.“Importantly, bothHealth 100 and Compumedics share common values regarding people, ethics andeachparties’contribution.This,coupledwithaformidabledrivingforcetobuildagreatJointVenture,willpositivelytransformtheworldofsleep,brainandassociatedhealthcareinChina.“We look forward tocompleting the formalitiesover thenextmonthor two toenable this importantjourneytocommence,whileweplanandcommencedeliveryofmajorhealthcareoutcomes.”Compumedicsnotesthatwhilebothpartieshavenegotiatedingoodfaithandagreedtothekeypointsdetailedinthisannouncement,aspartofbothpartiesenteringintotheFrameworkAgreement,thereisa possibility, due to reasons unknown by either party at this point in time, that the PJV will noteventuateinthetimeframecurrentlyanticipatedormaynoteventuateatall.Compumedicswillmakefurtherannouncementsastheseagreementsandactivitiesarecompleted.AbouttheHealth100andCompumedicsProposedJointVenture(PJV):The new Health 100 and Compumedics PJV has the potential tomobilise up to up to ormore than15,000 Health 100 employees to positively transform sleep and neurology health across China,commencingwiththenewCompumedicssleep/neurodiagnosticsandSomfitmobilewearablesystemsandplatform,forthemanagementofsleepandassociateddisorders.

For

per

sona

l use

onl

y

Althoughhumansspendaboutathirdoftheirlivessleeping,andsleepisrecognisedasoneofthethreeessentialpillarsofhealth (togetherwithnutritionandexercise),westillcannotreliablymeasure– let-alonemanage–oursleeponapersonalorroutinebasis.Somfit isthefirstof itskindconsumer-level,medical-grade wireless wearable sleep system, incorporating Compumedics’ widely deployed andvalidated‘goldstandard’sleepanalytics.Compumedics was founded in the 1980s following its development of computerised sleeppolysomnography. Compumedics entered the USA market in the 1990s with the development ofportablesleepmonitoring,winningtwoNASAastronautmonitoringcontractsalongwiththecontracttoequiptheworld’slargestportablestudyofitskind–theNIH-funded14,000-patientsleephearthealthstudy(SHHS).Somfit technologyallowseveryone,everywhere,anytimetoaccesspersonalisedmanagementof true-sleepmeasuresbasedonCompumedics’provenandwidelydeployedsleepanalytics.The Somfit platform covers sleep and associated disorders, including sleep-disorder breathing, sleeptreatment devices, cardiology, respirology, neurology anddiabetes, amongother sleep-relatedhealthmanagement disciplines. In addition to the deployment of 1 million Somfit systems and associatedhealth management platforms and device eco-systems, the PJV also involves the establishment ofHealth100’ssleepmanagementnetworkspanningtheHealth100centresinGreaterChina.ThePJVwillenableHealth100andCompumedicstocometogetherwithafocustopositivelytransformsleepandbrainhealthcare.AboutHealth100:Health100 (MeinianOnehealthHealthcareHoldingCo., Ltd) is the leader in theChinesehealth-checkindustry. It provides the largest service in China's preventive health-examination industry, offeringprofessionalmedicalexaminationsacrossabroadrangeofhealthcareareas.

Health100hasthelargestmedicalexaminationplatforminChina,supportedbythelargestprofessionalphysician, management and marketing teams in China. Health 100 has 400 medical and physicalexamination centres in provinces and cities throughout China, with 1,000 centres scheduled to beoperating in 2020. The Company listed on the Shenzen Stock Exchange (code 002044) in 2015, hasexperienced 25% compounding growth since then (including 46% growth in 2016 and 44% growth in2017)andtodayhas40,000employees.Health100doctorsandhealthcareexpertsundertook20millionhealthchecksin2017.Itisexpectedthatthisnumberwillriseto30millioninthecurrentyear.The Group successfully listed on the A-sharemarket (SZ:002044) in 2015. It has a significantmarketcapitalisationandhasamajorinfluenceinChinesehealthcaresector.Health100ChairmanDrRongYusaysthat“Healthistheultimatepursuitofmankind”and“preventionwithoutdisease,priorityformedicalexamination”hasgraduallybecomethecommonrecognitionofthegovernment,theenterprise,andthepeople.

For

per

sona

l use

onl

y

DrRongYusaysthatHealth100willcontinuetostrengthenandenhanceitsroleastheleaderinChina'shealth-inspection industry. Furthermore, Health 100 will be actively leading the industry in standardsetting,healthmanagementdemonstration,majorscientificresearchandnationalpublichealthpolicies,including social responsibility. In the era of the Internet, combined with the advantages of mobilemedicaltechnologyanduniquebigdataonhealth,Health100isontracktobecomeanindustryleaderinonlineservices,mobilehealthmanagementanddigitalmedicine.AboutCompumedicsLimited:Compumedics Limited [ASX: CMP] is a medical device company involved in the development,manufactureandcommercialisationofdiagnosticstechnologyforthesleep,brainandultrasonicblood-flow monitoring applications. The company owns US based Neuroscan and Germany based DWLElektronisheGmbH.Inconjunctionwiththesetwosubsidiaries,Compumedicshasabroadinternationalreach,includingtheAmericas,AustraliaandAsiaPacific,EuropeandtheMiddleEast.Executive Chairman Dr David Burton founded Compumedics in 1987. In the same year the companysuccessfully designed and installed the first Australian, fully computerised sleep clinic at EpworthHospital in Melbourne. Following this early success, Compumedics focused on the development ofproductsthatsoldintothegrowinginternationalsleepclinicandhomemonitoringmarkets.Compumedics listedon theAustralianSecuritiesExchange in2000.Over theyears,Compumedicshasreceivednumerousawards,includingAustralia’sExporteroftheYear,andhasbeenrecognisedasaTop100InnovatorbybothGermanandAustraliangovernments.Forfurtherinformationpleasecontact:DrDavidBurton DavidLawsonExecutiveChairman,CEOExecutiveDirector ChiefFinancialOfficerPh:+61384207300 Ph:+61384207300Fax:+61384207399 Fax:+61384207399InvestorRelations,Media&PRenquires:RodNorth RichardAllenManagingDirector OxygenFinancialPRBourseCommunicationsPtyLtd Ph:+61399156341Ph:+61395108309 Mob:0403493049Mob:0408670706

For

per

sona

l use

onl

y