May 20, 2016
Company Name:
Representative:

Contact:

NIKON CORPORATION
Kazuo Ushida,
President and Representative Director(Code Number: 7731; Stock listings: Tokyo
Stock Exchange)
Yosuke Toyoda, Department Manager,
Corporate Communications & Investor
Relations Department(Tel: +81-3-6433-3741)

Notice Concerning Partial Revision of Performance-based Stock Remuneration System
for the Executive Directors, etc. of the Company
NIKON CORPORAION (“Company”) hereby announces, as described below, that it has introduced aperformance-based stock remuneration system (“System”) as an incentive plan for the executive directors
and officers of the Company (excluding external directors and non-full-time directors; collectively“Directors, etc.”) as from the fiscal year ended March 31, 2016 and implemented the incentive plan in thesame fiscal year, based on the System (“Plan”). However, the Company resolved at its Board of Directors
meeting held on May 20, 2016 to partially revise the System to forge a stronger link between
compensation and performance.
This partial revision will not entail any changes in the substantive contents of the trust agreement
pertaining to the Trust (provided in (2)(3) of (Reference) below; the same applies hereinafter), which has
been already established.
The Company has decided on its transition to a company with an audit and supervisory committee, as
announced in the “Notice Concerning Transition to a Company with an Audit and Supervisory Committee
and Partial Amendments to the Articles of Incorporation” separately released today. The move is subject
to approval at the 152nd Annual General Meeting of Shareholders to be held on June 29, 2016. Also at
the meeting, the Company will submit a proposal on the System to come up with a new decision on the
portion of remuneration for Directors other than Audit and Supervisory Committee Members after thetransition, instead of the existing portion of remuneration for Directors.
The System will be partially revised as follows:<Points to be revised>
Previously, a Director, etc. who became a non-eligible person because of his/her resignation or being a
non-resident in Japan due to overseas assignments or any other reasons during the Target Period(“Withdrawal”) have received Delivery, etc. of Company Shares, etc. corresponding to the cumulative
Share Granting Points. This was irrespective of the degree of accomplishment of business performance atthe time when the Director, etc. became a Withdrawal (provided in (1) of (Reference) below; the same
applies hereinafter). Now, however, the Company will also grant to the Withdrawal after the end of theTarget Period, the Delivery, etc. of the Company Shares, etc. taking into account this degree ofaccomplishment. The details are as follows.

1(1) If an eligible Director, etc. for the System resigns during the Target Period of the System(excluding cases of resignation for personal reasons), such Director, etc. shall receive from theTrust, after the end of the Target Period, Delivery, etc. with regard to the Company Shares, etc.
corresponding to the number of points calculated by multiplying the cumulative Share Granting
Points up to the person’s resignation by the performance-based-coefficient (see (6)(*5) of(Reference) below; the same applies hereinafter).
(2) If an eligible Director, etc. for the System becomes a non-resident in Japan during the Target
Period of the System, the Director, etc. shall receive payouts from the Trust after the end of theTarget Period with regard to money equivalent to the Company shares converted into cash
corresponding to the number of points calculated by multiplying the cumulative Share Granting
Points by the performance-based-coefficient as of the time the Director, etc. becomes a
non-resident.

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(Reference)
Overview of the System and the Plan
(1) The System and the Plan Summary
The System is an incentive plan in which the delivery and payment (“Delivery, etc.”) of the Company
shares and the cash equivalent of the conversion value of said shares (“Company Shares, etc.”) to the
Directors, etc. as director remuneration will be conducted per every three years based on the degreeof accomplishment of business performance in the final fiscal year of the Medium Term Management
Plan.
Each incentive plan based on the System applies for three consecutive fiscal years (“Target Period”)
from the fiscal year to which the date of the establishment of the trust or the date of the extension of
the trust period belongs (“Base Fiscal Year”). The Target Period of the Plan will be for three fiscal
years starting from the fiscal year that ends on March 31, 2016 up to the fiscal year that ends on
March 31, 2018.
(2) The System Structure
The System adopts a structure called the Board Incentive Plan Trust (“BIP Trust”) (*). The BIP Trust isa stock incentive plan reference to the Performance Share system and Restricted Stock system in the
U.S., wherein the Company shares that are acquired by the BIP Trust will be delivered to theCompany’s Directors, etc., based on the degree of the attainment of business performance goals, etc.

(1) Resolution by the Shareholders Meeting(8) Gratis[Entruster]

Transfer/extinguishment ofCompany(2) Enactment of
Share Delivery

residual shares(3) Establishing the Trust(5) Dividends

Rules(9) Payment of residual
assets(7)[Trustee]
Mitsubishi UFJ Trust and Banking Corp.

Company share delivery
and cash payout[Beneficiaries](Co-trustee: The Master Trust Bank of Japan, Ltd.)(4) Company
Stock Market

BIP TrustCompany shares, cash

Directors, etc.

Shares(6) Instruction not to exercise(4) Payment of the pricevoting rights exercising
Trust Caretaker(1) The Company has obtained approval for director remuneration in relation to the introduction of the
System at the 151st Annual General Meeting of Shareholders held on June 26, 2015.
(2) The Company has, at the Board of Directors meeting, enacted the Shares Delivery Rules concerning
director remuneration in relation to the introduction of the System (the Company will partially revise the

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(3)

(4)
(5)
(6)
(7)

(8)

(9)

Shares Delivery Rules in association with this revision).
The Company has entrusted money to the extent approved by the resolution at the 151st Annual General
Meeting of Shareholders in (1) above, and established a trust (“Trust”) wherein the Company’s Directors,
etc., who meet the beneficiary requirements, are beneficiaries.
The Trustee (of the Trust) acquires the Company shares from the stock market using money contributedin (3) above in accordance with the instructions of the trust caretaker.
Dividends of the Company shares in the Trust will be distributed as well as other Company shares.
The voting rights of Company shares in the Trust will not be exercised during the trust term.
During the trust term, the Directors, etc. who meet the beneficiary requirements will receive the Company
shares according to the Shares Delivery Rules (in addition, the Directors, etc. will receive money
equivalent to a certain percentage of the Company shares under the Trust by converting those shares
into money according to the provisions of the trust agreement.).
If there are remaining shares at the expiry of the trust term due to non-achievement of performancetargets or other reasons during the trust term, the trust may continue to be used as a type of incentive
plan similar to the System by changing the trust agreement and entrusting additional money to the Trust,or the Trust may voluntarily convey said remaining shares to the Company and the Company may
acquire them without payment and cancel the remaining shares by a resolution at the Board of Directors
meeting.
Residual properties after distribution to beneficiaries at the end of the Trust will belong to the Company tothe extent of allowances for trust expenses, which are calculated by deducting the funds to acquireCompany shares from the trust money. The portion exceeding the allowances for trust expenses will be
donated to groups that have no vested interest with the Company and the Company’s Directors, etc.

(Note) If there are no remaining Company shares under the Trust due to the delivering of the Company
shares to the Directors, etc., who meet the beneficiary requirements, the Trust will be discontinued before
the expiry of the trust term. The Company may entrust additional money to the Trust as funds to acquire
the additional Company shares and the Trust may acquire the additional Company shares to the extent offunds necessary to acquire the Company shares that were approved by a resolution of the 151st Annual
General Meeting of Shareholders and the 152nd Annual General Meeting of Shareholders and to theextent of the maximum amount of the Company shares to be delivered (provided in (8), below).

(3) Resolution of the Shareholders Meeting Related to the System
The 151st Annual General Meeting of Shareholders has resolved the upper limit of the amount to be
paid to the Trust, the maximum amount of Company shares to be acquired and other necessary
matters. The Company will submit a proposal, which will substantially have the same content as the
proposal already resolved, required for procedural purposes in connection with the transition to acompany with an audit and supervisory committee to the 152nd Annual General Meeting of
Shareholders to be held on June 29, 2016. In addition, if the trust period is extended (see (5) below),the Board of Directors will resolve to change the trust agreement and entrust additional money to theTrust at the expiry of the trust term to the extent approved by resolutions at the 151st Annual General
Meeting of Shareholders and the 152nd Annual General Meeting of Shareholders.
(4) Eligibility under the System (Beneficiary Requirements)
The Delivery, etc. of the Company Shares, etc. to the Directors, etc. from the Trust will be conducted
corresponding to the Share Granting Points (provided in (6) below) if the Directors, etc. have fulfilled
the beneficiary requirements.
Beneficiary requirements of the System will be as follows:

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(i)

a person who is in office as the Director, etc. as of the end of the Board of Directors meeting held
after the end of an Annual Meeting of Shareholders for the Base Fiscal Year (in the Plan, the151st Annual General Meeting of Shareholders); (*1) (*2) (*3) (*4)(ii) a person who resides in Japan;(iii) a person who does not fall within those who left office due to dismissal, etc., or who conductedcertain illegal activities during their time in office;(iv) a person whose Share Granting Points provided in (6) below have been determined;(v) a person who satisfies other requirements deemed necessary to attain the aim of the System asa share remuneration system.
(*1) If an eligible Director, etc. resigns (excluding cases of resignation for personal reasons), such
Director, etc. shall receive from the Trust, after the end of the Target Period, Delivery, etc. withregard to the Company Shares, etc. corresponding to the number of points calculated bymultiplying the cumulative Share Granting Points up to the person’s resignation by theperformance-based-coefficient.
(*2) If an eligible Director, etc., passes away during his/her time in office as the Company’s Director,
etc., a successor of the Directors, etc. shall receive payouts from the Trust promptly with regard
to money equivalent to Company shares converted into cash corresponding to the cumulative
Share Granting Points as of death of the Directors, etc.
(*3) If an eligible Director, etc. becomes a non-resident in Japan during the Target Period, the Director,
etc. shall be treated in the same manner as those who resign and shall receive payouts from theTrust after the end of the Target Period with regard to money equivalent to the Company sharesconverted into cash corresponding to the number of points calculated by multiplying the
cumulative Share Granting Points by the performance-based-coefficient.
(*4) A person who newly becomes eligible for the System during the Target Period and is not eligible
for the System at the end of the Board of Directors meeting held after the end of the Annual
Meeting of Shareholders for the Base Fiscal Year (in the Plan, the 151st Annual General Meetingof Shareholders) shall not be eligible for the System during the Target Period. However, theperson will be granted Share Granting Points in accordance with his/her service period in thesame manner as an eligible Director, etc. Yet, if the Trust is continued as provided in (5) below,
the Delivery, etc. of the Company Shares, etc. from the continued trust, corresponding to the
Share Granting Points during the above Target Period, will take place, in addition to the Company
Shares, etc. corresponding to the Share Granting Points granted during the period of thecontinued trust.

(5) Trust Term
The trust term pertaining to the Plan will be about three years, from August 11, 2015 until the end of
August 2018.
The Trust may be continued by changing the trust agreement and entrusting additional money at the
expiration of the trust term. In such cases, the Company may further extend the trust term of the Trust,
entrust additional money to the Trust per each extended trust term to the extent of the upper limit oftrust money approved by the resolutions at the 151st Annual General Meeting of Shareholders andthe 152nd Annual General Meeting of Shareholders, and continue the grant of Share Granting Points
to Directors, etc., continuously during the extended trust term.
However, in cases where such additional entrustment is made and there are remaining Company
shares (excluding Company shares to be delivered to Directors, etc., corresponding to the Share5

Grating Points granted to the Directors, etc., which have not been delivered to the Directors, etc.) andmoney (collectively the “Remaining Company Shares, etc.”) in the trust assets as of the last day of theprevious trust term, the total amount of the Remaining Company Shares, etc., and the additional
contribution of trust money shall be within the upper limit of trust money approved by the resolutions at
the 151st Annual General Meeting of Shareholders and the 152nd Annual General Meeting of
Shareholders.
(6) Amount of the Company Shares to Be Delivered to the Directors, etc.
Points calculated in accordance with the points calculation formula defined below will be granted to
the Directors, etc., as of June 1 (or the next business day in case June 1 is not a business day) every
year during the trust term. The Company shares delivered to the Directors, etc., will be determinedbased on the number of points (“Share Granting Points”) which is calculated as of June after the endof the final fiscal year of the Medium Term Management Plan to be resolved per each three fiscal
years (June 2018 in relation to the Plan) by multiplying the performance-based coefficient (*5) to thethree-year cumulative points after consideration of discussions and advice from the Compensation
Committee consisting of the representative directors, external directors and external experts. One
Share Granting Point equals to one share (*6).
(Points Calculation Formula)
Base compensation by title (*7) x ratio by title (*8) / average price per share acquired by the Trust(fractions after the decimal point to be rounded down)(Share Granting Points)
Three-year cumulative points x performance-based coefficient(*5) The performance-based coefficient shall be determined within the range of 0% to 150% in
accordance with achievement during in the final fiscal year (the fiscal year of 2017 in relation to
the Plan) of the Medium Term Management Plan to be resolved per each three fiscal years.
(*6) If events such as a share split or reverse share split occurs and the adjustment of the number ofpoints during the trust term in accordance with such events is regarded as appropriate, suchadjustment will be made in accordance with the relevant share split ratio or reverse share split
ratio, etc.
(*7/8) The “base compensation by title” and “ratio by title” will be determined in consideration offactors such as responsibilities and duties, and the percentage of monetary compensation andstock compensation in overall executive compensation.
(7) Method and Timing of the Delivery, etc. of the Company Shares, etc. to the Directors, etc.
The Delivery, etc. of Company Shares, etc., corresponding to the Share Granting Points will be
conducted in June after the end of the final fiscal year of the Medium Term Management Plan to beresolved per each three fiscal years (June 2018 in relation to the Plan) to eligible Directors, etc., who
satisfy the beneficiary requirements.
(8) Amount of Trust Money to be paid to the Trust and Amount of the Company Shares to bedelivered by the Trust
The upper limit of the amount of trust money entrusted to the Trust by the Company shall be 1.2 billion
yen (*9).

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(*9) These are the total funds for the Trust acquired shares, as well as trust fees and trust expenses.
The Company obtained the approval by the resolution at the 151st Annual General Meeting of
Shareholders for an upper limit of 1.2 billion yen for the amount to be paid for the System. The
Company will also submit a proposal, which will be substantially the same content as the
proposal already resolved, to the 152nd Annual General Meeting of Shareholder. If it is so
resolved, the Company may pay money to the Trust under the System up to said limit.
The total amount of the Company Shares, etc., to be delivered under the Trust pursuant to (6) above
shall be up to 730 thousand shares. The maximum amount of the Company shares to be delivered
has been determined based on the upper limit of trust money mentioned above and in reference tostock prices, etc.
(9) Method of acquiring the Company Shares by the Trust
The Trust will acquire the Company shares from the stock market to the extent of the funds to acquire
shares and the maximum amount of the Company shares to be delivered, as specified in (8) above.
(10) Exercising Voting Rights Related to Company Shares in the Trust
Voting rights related to the Company shares in the Trust (namely Company shares, with respect towhich Delivery, etc. has not been conducted yet pursuant to (7) above) will not be exercised during thetrust term, to ensure the neutrality of the Company management.
(11) Treatment of Dividends Related to the Company Shares in the Trust
Dividends related to the Company shares in the Trust will be received by the Trust and used for trust
fees and trust expenses.
(12) Treatment at the End of the Trust Term
If there are residual shares at the end of the trust term due to the non-attainment of businessperformance goals during the Target Period, the Trust may continue to be used as the same type of
incentive plan as the performance-based stock remuneration system by changing the trust agreement
and paying additional money to the Trust. If the Trust is terminated by the expiry of the trust term, theTrust will transfer said remaining shares to the Company without compensation and the Company willcancel said shares by a resolution at the Board of Directors meeting.
If there is a remainder of dividends at the end of the Trust Period, even after dividends are used fortrust fees and trust expenses under the Trust, the remainder will be donated to groups that have novested interest with the Company or the Directors, etc.

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