NEC Corporation

1. Nature of Operations

The company is engaged in the development, manufacture and sale of electronic products that comprise primarily three product categories: communications systems and equipment, computers and industrial electronic systems, and electron devices. The company's principal business activities are based on the integration of computer and communications products and technology ("C&C"), supported by semiconductor and software technology. For the year ended March 31, 1996, the company's C&C operations represented 96 percent of consolidated net sales, which are composed of: sales of communications systems and equipment--28 percent; computers and industrial electronic systems--44 percent; and electron devices--24 percent. The company operates manufacturing plants in Japan, the United States of America, Europe, Asia and other countries. The company's products are sold through sales offices in Japan and overseas countries situated throughout the world. During the year ended March 31, 1996, sales to customers in Japan were approximately 72 percent of consolidated net sales. In these Notes, references to the "company" are (unless the context does not so permit) to the parent company and its consolidated subsidiaries.

Copyright NEC Corporation. All rights reserved.