China Electric Motor (PINK:CELM)

We may offer, issue and sell shares of our common stock, preferred stock, warrants and units from time to time, or any combination of these securities, in one or more issuances. This prospectus provides a general description of offerings of these securities that we may undertake. The aggregate public offering price of securities being offered will not exceed $50,000,000.

On November 6, 2010, Ningbo Heng Bang Long Electrical Equipment Co., Ltd. (“Ningbo Electrical”), an indirect wholly-owned entity of China Electric Motor, Inc. entered into an Asset and Business Purchase Agreement with Ningbo Bang Shi Da Electrical Equipment Co., Ltd. and Fan Wenda pursuant to which Ningbo Electrical agreed to purchase the assets and business of Seller for an aggregate purchase price of RMB 49,322,100 (or approximately US$7.4 million, based on the exchange rate as of November 6, 2010) (the “Acquisition”). The purchase price will be paid by Ningbo Electrical in a series of installments, and will be subject to certain adjustments, as described in the Agreement. The Agreement contains customary representations, warranties and covenants, and also provides for a sell back option, exercisable by Ningbo Electrical for up to three years following the closing of the Acquisition, upon the occurrence of certain third party claims against the purchased assets or business, or the inability of Ningbo Electrical to operate the purchased business due to Seller’s material violation of the Agreement. The closing of the Acquisition is expected to take place within 15 business days following the signing date, although there can be no assurance that the Acquisition will be completed on the proposed terms or at all. Each party’s obligation to complete the transaction remains subject to the satisfaction or waiver of various conditions. Ningbo Electrical and Seller may terminate the Agreement prior to closing in certain circumstances.