Unassociated Document


    AMENDED
      PRELIMINARY FINANCIAL SERVICE AGREEMENT

    


    The
      Preliminary Financial Service Agreement is entered into as of May 14, 2008
      between ELZ
      Accountancy Corp., its designated employee Elaine Zhao
      (collectively “Zhao”), and China
      Power Equipment, Inc.
      (the
‘Company”). ELZ Accountancy Corp. hereby agrees to designate its employee Elaine
      Zhao to serve as Chief Financial Officer of China Power Equipment, Inc., for
      an
      initial period of two years. The annual compensation, paid quarterly to ELZ
      Accountancy Corp. or Elaine Zhao at the beginning of each quarter, shall be
      US
      $45,000.

    


    Specific
      responsibilities shall include:

    


    
      	
            	1.	
              Review
                of the historical accounting
                records

            


    

    
      	
            	2.	
              Implementation
                of appropriate internal financial
                controls.

            


    

    
      	
            	3.	
              Interacting
                with the Company’s internal accounting
                staff

            


    

    
      	
            	4.	
              Liaison
                with the Company’s auditors and securities attorney regarding filing and
                reporting requirements

            


    

    
      	
            	5.	
              Preparation
                of consolidated financial statements including
                footnotes

            


    

    
      	
            	6.	
              Preparation
                of MD&A for inclusion in SEC
                filings

            


    

    
      	
            	7.	
              Preparation
                as may be required of forecasts and
                budgets.

            


    

    
      	
            	8.	
              Signing
                off on financial statements and regulatory
                filings

            


    

    
      	
            	9.	
              Maintaining
                the books and records and the US bank account(s) for the parent
                company

            


    

    
      	
            	10.	
              Meeting
                with company management and visits to the Company’s facilities as may be
                required

            


    

    
      	
            	11.	
              Participation
                at investor meetings and conferences as may be
                required

            


    

    
      	
            	12.	
              Taking
                phone calls from the financial community and
                investors

            


    

    
      	
            	13.	
              Other
                activities appropriate to the responsibilities of being the chief
                financial officer

            


    

    
      	
            	14.	
              The
                preparation and filing of any appropriate state and Federal withholding
                and tax filings.

            


    

    


    Zhao
      and
      the Company agree that the performance, compensation and time commitment by
      Zhao
      shall be reviewed quarterly, and appropriate adjustments shall be made thereof,
      subject to parties written agreement.

    


    Zhao
      shall be entitled to reimbursement for appropriate business expenses, as well
      as
      travel and related expenses.

    


    The
      Company agrees to issue to Zhao 50,000 shares of stock option upon the effective
      of the registration statement and 25,000 shares every six months subsequently
      to
      purchase the Company’s common shares. The exercise price for the Options granted
      upon the effective of registration statement shall be equal to $0.23. The
      exercise price for the subsequent Options shall be equal to the lower of the
      30
      day average stock price or the 180 day average stock price prior to the issue
      date. The Options shall
      become exercisable upon issuance and shall have a term of five (5) years.
All
      Options granted to Zhao shall be subject
      to regulatory requirements. 

    


    This
      Preliminary Financial Service Agreement shall be in force until such time as
      a
      formal Employment Agreement is entered into by Elaine Zhao and the Company,
      and
      will be subject by termination by either party providing the other party four
      weeks written notice.

    


    Agreed
      to:

    Elaine
      Zhao/ELZ Accountancy Corp.

    

      
        	
                /s/
                  Elaine Zhao

              	
                Date
                  May 14, 2008

              
	
                China
                  Power Equipment, Inc.

              	 
	 	 
	
                /s/
                  Mr. Yarong Feng Title:
                  Director

              	
                Date
                  May 14, 2008