QAR, LLC made an offer to acquire the remaining 92.82% stake in China Power Equipment, Inc. (OTCPK:CPQQ) for $9.1 million on January 3, 2014. QAR, LLC will buy all of the outstanding shares and options of China Power at a price of $0.50 per share in cash. China Power Equipment's Board of Directors can accept an unsolicited superior proposal upon payment of a termination fee equal to 5% of the transaction value plus reimbursement of the transaction expenses.

This term sheet will be considered void if it is not executed by China Power Equipment prior to January 9, 2014. Transaction will be structured as a merger agreement. The transaction is subject to due diligence, approval by the China Power's stockholders of the merger agreement, receipt of any and all required regulatory approvals, third party consents and preparation of definitive documentation.

The transaction will not be subject to any financing conditions. China Power's Board of Directors unanimously declined the offer on January 9, 2014. It is contemplated that the closing will take place in the second calendar quarter of 2014.