PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT
THIS PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT (the "Agreement") is entered
into as of _______, 2007, by and among CHINA POWER EQUIPMENT, INC., a Maryland corporation (the
"Company"), with headquarters located at 76 Cranbrook Road, Cockeysville, County of Baltimore, MD 21020,
and the purchasers (collectively, the "Purchasers" and each a "Purchaser") set forth on SCHEDULE 1 hereof,
with regard to the following:
RECITALS
A. The Company and the Purchasers are executing and delivering this Agreement in reliance upon the exemption
from securities registration afforded by the provisions of Regulation D ("Regulation D") and/or Regulation S, as
promulgated by the United States Securities and Exchange Commission (the "SEC") under the Securities Act of
1933, as amended (the "Securities Act").
B. The Purchasers desire to (a) purchase, upon the terms and conditions stated in this Agreement, shares of the
Company's Series A Convertible Preferred Stock, $.001 par value per share (the "Preferred Stock") and (b)
purchase, upon the terms and conditions stated in this Agreement, the Common Stock Purchase Warrants (the
"Warrants") to purchase shares of the Company's Common Stock, $.001 par value per share ("Common
Stock"), in the form attached hereto as EXHIBIT A. The shares of Common Stock issuable upon exercise of or
otherwise pursuant to the Warrants are referred to herein as "Warrant Shares." The Preferred Stock, the
Warrants and the Warrant Shares are collectively referred to herein as the "Securities". The Warrants and any
other documents or agreements executed in connection with the transactions contemplated hereunder, are
hereinafter referred to as the "Transaction Documents."
AGREEMENTS
NOW, THEREFORE, in consideration of their respective promises contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the
Purchasers hereby agree as follows:
ARTICLE I
PURCHAS