TRANSLATION Securities Code: 7751 Notice of Convocation of the Ordinary General Meeting of Shareholders for the 118th Business Term To Our Shareholders We are pleased to present our notice of convocation of the Ordinary General Meeting of Shareholders for the 118th Business Term (from January 1, 2018 to December 31, 2018). The world economy in 2018 remained on a path of moderate recovery on the whole supported in part by the steady recovery in the U.S. economy, despite the aggravation of the U.S.-China trade friction and the economic slowdown in China. In such environment, the Canon Group strived to improve business results by implementing measures, for example, to ensure efficiency improvement throughout the entire business process from research and development and production to sales and services under the new business portfolio that combines the existing key businesses such as business machines and cameras with four new businesses: commercial printing, network cameras, medical systems, and industrial equipment. For the 118th Business Term, we were able to achieve an increase in profit through further profitability improvement, although net sales decreased slightly due to the effect of the shrinking of the markets related to our business such as digital cameras. Index NOTICE OF CONVOCATION OF THE ORDINARY GENERAL MEETING OF SHAREHOLDERS FOR THE 118TH BUSINESS TERM P. 3 For the term-end dividend, to realize a stable return and Guidance Notes on the Exercise of Voting Rights P. 4 GENERAL MEETING OF SHAREHOLDERS NOTICE OF CONVOCATION THE ORDINARY actively return profits to shareholders and in appreciation for REFERENCE DOCUMENTS FOR the ongoing support of our shareholders, we will propose a GENERAL MEETING OF SHAREHOLDERS Propositions: distribution of 80.00 yen per share at the Ordinary General Item No.1 - Dividend from Surplus P. 6 Item No.2 - Election of Six Directors P. 7 Meeting of Shareholders for the 118th Business Term. As a Item No.3 - Election of Two Audit & Supervisory REFERENCE DOCUMENTS FOR Board Members P. 11 GENERAL MEETING OF SHAREHOLDERS result, dividends for this year, when combined with the Item No.4 - Grant of Bonus to Directors P. 14 interim dividend (80.00 yen per share), will be 160.00 yen per (Materials delivered pursuant to Article 437 and Article 444 of the Corporation Law) share. BUSINESS REPORT REPORT Despite the growing concerns about expansion of the impact 1. Current Conditions of the Canon Group P. 15 BUSINESS 2. Shares of the Company P. 27 from the U.S.-China trade friction in the world economy in 3. Stock Acquisition Rights etc. of the Company P. 28 2019, the Canon Group will make united efforts to continue 4. Directors and Audit & Supervisory Board Members P. 29 5. Accounting Auditor P. 31 to pave a path to further growth. 6. Systems Necessary to Ensure the Properness of Operations P. 32 STATEMENTS We look forward to our shareholders’ continued support and CONSOLIDATED FINANCIAL STATEMENTS encouragement. Consolidated Balance Sheets P. 36 CONSOLIDATED FINANCIAL Consolidated Statements of Income P. 37 Consolidated Statement of Equity P. 38 Notes to Consolidated Financial Statements P. 39 FINANCIAL STATEMENTS FINANCIAL STATEMENTS Balance Sheets P. 42 Statements of Income P. 43 Statement of Changes in Net Assets P. 44 Notes to Non-Consolidated Financial Statements P. 45 March, 2019 AUDIT REPORTS AUDIT REPORT OF ACCOUNTING AUDITOR AUDIT REPORTS ON CONSOLIDATED FINANCIAL STATEMENTS P. 47 Chairman & CEO FUJIO MITARAI AUDIT REPORT OF ACCOUNTING AUDITOR P. 48 AUDIT REPORT OF AUDIT & SUPERVISORY BOARD P. 49 REFERENCE CSR Initiatives P. 51 REFERENCE Information for Shareholders P. 53 The map of the place of the General Meeting of Shareholders Securities Code: 7751 TO OUR SHAREHOLDERS March 4, 2019 CANON INC. 30-2, Shimomaruko 3-chome, Ohta-ku, Tokyo Chairman & CEO Fujio Mitarai NOTICE OF CONVOCATION OF THE ORDINARY GENERAL MEETING OF SHAREHOLDERS FOR THE 118TH BUSINESS TERM Notice is hereby given that the Ordinary General Meeting of Shareholders for the 118th Business Term of Canon Inc. (the “Company”) will be held as described below and that you are invited to attend the Meeting. If you do not expect to attend the Meeting, you may exercise your voting rights in writing or by electromagnetic means (Internet etc.) in accordance with the “Guidance Notes on the Exercise of Voting Rights” (pages 4-5). After reviewing the following Reference Documents for General Meeting of Shareholders, please exercise your voting rights by no later than 5:00 p.m. on March 27 (Wednesday), 2019 (Japan time). 1. DATE AND TIME: March 28 (Thursday), 2019 at 10:00 a.m. (Japan time) (The reception will commence at 9:00 a.m.) 2. PLACE: Headquarters of the Company 30-2, Shimomaruko 3-chome, Ohta-ku, Tokyo (Please see the map at the end of this notice.) 3. MATTERS CONSTITUTING Matters to be Reported: THE PURPOSE OF THE 1. Reports on the contents of the Business Report and Consolidated Financial Statements for the 118th MEETING Business Term (from January 1, 2018 to December 31, 2018), and reports on the Auditing Results of Accounting Auditor and Audit & Supervisory Board regarding the Consolidated Financial Statements. 2. Reports on the content of the Financial Statements for the 118th Business Term (from January 1, 2018 to December 31, 2018). Matters to be Resolved upon: Propositions: Item No.1 - Dividend from Surplus Item No.2 - Election of Six Directors Item No.3 - Election of Two Audit & Supervisory Board Members Item No.4 - Grant of Bonus to Directors • It would be appreciated if you could come early since the reception desk is expected to be crowded just before the opening of the Meeting. • Upon attending the Meeting, please present the enclosed Voting Form to the receptionist at the place of the Meeting. • Please note that no gift will be provided at the Meeting. Thank you for your understanding. • Any changes in the matters described in Reference Documents for General Meeting of Shareholders, Business Report, Consolidated Financial Statements and Financial Statements will be posted on our website on the Internet (https://global.canon/en/ir/). 3 Guidance Notes on the Exercise of Voting Rights This is to introduce the procedure to exercise voting rights of shareholders of the Company in writing (using the Voting Form) or by electromagnetic means (Internet, etc.). 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