Nanjing Panda Electronics Company Limited — Proxy Solicitation & Information Statement 2011

Jan 28, 2011

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional advisor.

If you have sold or transfer all your shares in Nanjing Panda Electronics Company Limited , you should at once hand this circular and the accompanying form of proxy to the purchaser or other transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

==> picture [375 x 130] intentionally omitted <==

APPOINTMENT OF INTERNATIONAL AUDITOR AND NOTICE OF EXTRAORDINARY GENERAL MEETING

A notice convening an extraordinary general meeting of Nanjing Panda Electronics Company Limited to be held at the Company’s Conference Room, 301 Zhongshan Road East, Nanjing, the People’s Republic of China on Friday, 18 March 2011 at 9:00 a.m., is set out on pages 4 to 5 of this circular.

Whether or not you are able to attend the extraordinary general meeting, please complete and return the enclosed form of proxy in accordance with the instructions printed thereon to the office of Nanjing Panda Electronics Company Limited as soon as possible and in any event not less than 24 hours before the time of the extraordinary general meeting or any adjournment thereof. Completion and delivery of the form of proxy will not preclude you from attending and voting in person at the extraordinary general meeting or any adjournment thereof should you so wish.

31 January 2011

CONTENTS

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	ii
LETTER FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
NOTICE OF EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4

— i —

DEFINITIONS

In this circular, the following expressions shall have the following meanings unless the context otherwise requires:

“Baker Tilly” Baker Tilly Hong Kong Limited ( 天職香港會計師事務所有限公司 ) “Board” the board of Directors “Company” Nanjing Panda Electronics Company Limited, a joint stock company incorporated in the PRC with limited liability and the H-shares of which are listed on the main board of the Stock Exchange “Directors” the directors of the Company “EGM” the extraordinary general meeting of the Company to be convened on Friday, 18 March 2011, at 9:00 a.m. for the purpose of, among other matters, considering and, if thought fit, appointment of international auditor “Hong Kong” the Hong Kong Special Administrative Region of the PRC “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange “PRC” the People’s Republic of China “Shareholders” holder(s) of the shares of the Company “Stock Exchange” The Stock Exchange of Hong Kong Limited “UHY” UHY Vocation HK CPA Limited

The English names of the PRC established companies/ entities in this circular are only translation of their official Chinese names. In case of inconsistency, the Chinese names prevail.

— ii —

LETTER FROM THE BOARD

==> picture [375 x 130] intentionally omitted <==

Non-executive Directors:

Mr. Lai Weidi (Chairman) Mr. Xu Guofei Mr. Jason Hsuan Mr. Zhu Lifeng Mr. Deng Weiming Mr. Lu Qing

Registered Address:

Level 1-2, Block 5, North Wing, Nanjing High and New Technology Development Zone, Nanjing, the PRC

Independent non-executive Directors:

Mr. Cai Lianglin Mr. Ma Chung Lai, Lawrence Mr. Tang Yousong

Office Address: 301 Zhongshan Road East, Nanjing, the PRC Postal Code: 210002

31 January 2011

To the Shareholders

Dear Sir or Madam,

APPOINTMENT OF INTERNATIONAL AUDITOR AND

NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

Reference is made to the announcements of the Company dated 6 December 2010 and 28 January 2011 regarding the resignation of UHY as the Company’s international auditor with effect from 2 December 2010 and the appointment of a new international auditor of the Company respectively.

— 1 —

LETTER FROM THE BOARD

In order to fill the casual vacancy following the resignation of UHY, the Board proposes to appoint Baker Tilly as the international auditor of the Company for the financial year ended 31 December 2010 and to hold office until conclusion of the next annual general meeting of the Company. The appointment of Baker Tilly as the international auditor of the Company is subject to and will take effect upon the Shareholders’ approval at the EGM.

The purpose of this circular is to provide you with information in respect of the appointment of international auditor of the Company and to give you a notice of the EGM.

APPOINTMENT OF INTERNATIONAL AUDITOR

As announced by the Company on 6 December 2010, the Company was notified by UHY that Vocation International Certified Public Accountants Co., Ltd. ( 天職國際會計師事務所有限公司 ), the PRC auditor of the Company, has joined Baker Tilly International, and the H-Shares audit business of UHY has been transferred and merged with Baker Tilly. The Company was also notified that Baker Tilly has changed its Chinese name from “ 香港天華會計師事務所有限公司 ” to “ 天職香港會計師 事務所有限公司 ”. Hence, UHY tendered its resignation as international auditor of the Company with effect from 2 December 2010.

In order to fill the casual vacancy following the resignation of UHY, the Board proposes to appoint Baker Tilly as the new international auditor of the Company for the financial year ended 31 December 2010 and to hold office until conclusion of the next annual general meeting of the Company, subject to the approval of the Shareholders at the EGM.

The Company has received a confirmation letter from UHY that there is no disagreement between UHY and the Company, nor are there matters connected with its resignation that need to be brought to the attention of the Shareholders, creditors or audit committee of the Company. The Board also confirms that there are no other matters in respect of the change of international auditor which should be brought to the attention of the Shareholders. It is expected that the change of the Company’s international auditor will not affect the publication of the audited annual results of the Company for the financial year ended 31 December 2010.

EGM

An EGM will be convened and held on Friday, 18 March 2011, at 9:00 a.m. at the Company’s Conference Room, 301 Zhongshan Road East, Nanjing, the PRC, at which an ordinary resolution will be proposed to seek Shareholders’ approval for the appointment of Baker Tilly as the Company’s international auditor. At the EGM, votes will be taken by poll.

— 2 —

LETTER FROM THE BOARD

The notice of the EGM is set out on pages 4 to 5 of this circular.

The register of members relating to H-shares of the Company will be closed from 19 February 2011 to 18 March 2011, both days inclusive, during which period no transfer of H-shares of the Company will be registered. In order to attend the EGM, all transfers accompanied by the relevant share certificates must be lodged with the share registrar of the Company in Hong Kong, Hong Kong Registrars Limited, at 46th Floor, Hopewell Center, 183 Queen’s Road East, Hong Kong, no later than 4:00 p.m. on 18 February 2011.

A form of proxy for use at the EGM is enclosed with this circular. Whether or not you intend to attend the EGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return the same to the office of the Company as soon as possible but in any event not less than 24 hours before the time appointed for holding the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting at the EGM or any adjourned meeting should you so wish.

RECOMMENDATION

The Directors consider that the appointment of Baker Tilly as the international auditor of the Company is in the interests of the Company and the Shareholders as a whole, and accordingly recommend the Shareholders to vote in favour of the relevant resolution to be proposed at the EGM.

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes the particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein misleading.

By order of the Board

Nanjing Panda Electronics Company Limited Lai Weide Chairman

— 3 —

NOTICE OF EGM

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this notice, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this notice.

==> picture [375 x 130] intentionally omitted <==

NOTICE OF FIRST EXTRAORDINARY GENERAL MEETING IN 2011

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “ EGM ”) of Nanjing Panda Electronics Company Limited (the “ Company ”) will be held at 9:00 a.m. on Friday, 18 March 2011, at the Company’s Conference Room, 301 Zhongshan Road East, Nanjing, the People’s Republic of China, to consider and, if thought fit, pass the following resolution (with or without modification):

ORDINARY RESOLUTION

“THAT the appointment of Baker Tilly Hong Kong Limited as the international auditor of the Company for the financial year ended 31 December 2010, with a term until conclusion of the next annual general meeting of the Company be and is hereby approved and the board of directors of the Company be and is hereby authorized to fix their remuneration.”

By order of the Board

Nanjing Panda Electronics Company Limited Lai Weide Chairman

Nanjing, the People’s Republic of China 28 January 2011

As at the date of this announcement, the Board comprises: Non-executive Directors: Mr. Lai Weidi, Mr. Xu Guofei, Mr. Jason Hsuan, Mr. Zhu Lifeng, Mr. Deng Weiming and Mr. Lu Qing; and Independent Non-executive Directors: Mr. Cai Lianglin, Mr. Ma Chung Lai, Lawrence and Mr. Tang Yousong.

— 4 —

NOTICE OF EGM

Notes:

1. All shareholders of the Company whose names appear in the Company’s register of members at the close of business on Friday, 18 February 2011 are entitled to attend the Company’s first EGM in 2011. Holders of A Shares of the Company whose names appear in the register of members in the Shanghai branch of China Securities Depository and Clearing Corporation Limited at the close of business on 18 February 2011 can bring along with their identity cards or shareholder account cards to attend the EGM. Holders of A Shares or their proxies (if any) shall bring their identity cards, shareholder account cards and the proxy forms (if any) to complete the procedures for attending the EGM at the secretarial office of the Board of the Company at 301 Zhongshan Road East, Nanjing at 9:00 a.m. to 4:00 p.m. from 18 February 2011 to 28 February 2011. Overseas shareholders can register by post or by fax.

2. All holders of H Shares of the Company should pay attention that the register of members of the Company will be closed from 19 February 2011 to 18 March 2011, both days inclusive, during which period no transfer of H Shares can be registered. Holders of H Shares whose names appear in the Company’s register of member at the close of business on 18 February 2011, or their representatives or proxies are entitled to attend the EGM with their identity certificates or passports. If a shareholder appoints a proxy to attend the EGM on his behalf, his proxy must bring along with the proxy form.

3. Shareholder who has the right to attend and vote at the EGM is entitled to appoint one proxy or several proxies, whether a member of the Company or not, to attend and vote at the EGM.

4. If more than one proxy are appointed, the rights of voting may only be exercised when a poll is taken.

5. The instrument appointing a proxy must be in writing under the hand of the appointer or his attorney duly authorized in writing. In the case of a corporation, the proxy form must be under its common seal or under the hand of its director or duly authorized attorney. If the proxy form is signed by an agent on behalf of an appointer, the proxy form or other authority must be notarially certified. The proxy form together with the notarially certified power of attorney or other authority must be delivered to the office of the Company 24 hours before the time appointed for the holding of the EGM.

6. Shareholders who intend to attend the EGM should send a reply in writing to the office of the Company in person or by post or by fax before to 28 February 2011. The written reply would not preclude the shareholders to attend the EGM.

7. The EGM is expected to last for a half day. Shareholders and their proxies attending the EGM are responsible for their own transportation and accommodation expenses.

8. According to the Articles of Association, cumulative voting shall be adopted for the ordinary resolution.

9. The Company’s office and correspondence address:

301 Zhongshan Road East, Nanjing, the People’s Republic of China Postal code: 210002 Telephone: (8625) 8480 1144 Fax: (8625) 8482 0729

— 5 —