Nikon Corporation Announces Convertible Bond Offering

Nikon Corporation ("Nikon") announced today that its Board of Directors has approved the issuance of Zero Coupon Convertible Bonds due 2011 (bonds with stock acquisition rights, tenkanshasaigata shinkabu yoyakuken-tsuki shasai or the "Convertible Bonds") in the principal amount of ¥34.5 billion (including the greenshoe option of ¥4.5 billion). NC International Limited, a special purpose vehicle located in the Cayman Islands, will purchase the Convertible Bonds and hold the Convertible Bonds as security, to issue Senior Secured Zero Coupon Exchangeable Bonds due 2011 (the "Exchangeable Bonds") which will be offered to institutional investors in the Euro market. The Convertible Bonds and the Exchangeable Bonds will have substantially equivalent terms.

We will use the proceeds of the offering to repay certain debt obligations, to fund investments designed to enhance the competitiveness and profitability of our core businesses as well as to strengthen our financial flexibility which will enable us to capitalize on the improving market conditions in the semiconductor industry and further expand our imaging products business.

We believe that this financing will further enhance Nikon's technology leadership, competitive position and improve the profitability of our stepper business where we have the leading market share globally. Also this will enable us to take advantage of our strong positions in the high-end digital cameras and to further expand our share of the consumer category cameras markets by expanding our in-house manufacturing and production overseas.

With the high premium, zero coupon structure, we are able to minimize both interest cost and potential EPS dilution. In addition, by having the soft mandatory option^*1 to deliver shares at maturity, we aim to further strengthen our equity position and increase our financial flexibility in the future. This financing is consistent with our current financial strategy of diversifying sources of liquidity and strengthening the equity base, in order to have a stronger balance sheet to best address the ever changing business environment.

About Nikon:

Nikon is a leading developer and manufacturer of advanced optical and precision equipment. Nikon designs and makes precision equipment for use in semiconductor and liquid crystal display ("LCD") fabrication, inspection and measurement. Nikon also makes visual imaging products including cameras; instruments such as microscopes; and other products such as chemical mechanical polishing ("CMP") systems, binoculars, surveying instruments and eyewear. By leveraging its strong and long-standing customer relationships, global brand recognition and technological expertise, Nikon is well positioned to maintain its market leadership through its emphasis on cutting-edge research and development and its ability to adapt its products to meet its customers' quickly changing needs.

• Note: These materials are not an offer for sales of the Convertible Bonds issued by Nikon and the Exchangeable Bond issued by NC International Limited in the United States. The Convertible Bonds and Exchangeable Bonds have not been registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be sold in the United States absent registration or an exemption from registration under the Securities Act.