August 18, 2010
Canon. Inc.

Notice regarding liquidation of subsidiary

TOKYO, August 18, 2010—Canon Inc. announced today that, at its Board of Directors meeting held on August 18, 2010, a resolution was passed to dissolve and liquidate SED Inc., a consolidated subsidiary of Canon Inc., on September 30, 2010.

1. Reason for liquidation

SED Inc., targeting the commercialization of SED (Surface-conduction Electron-emitter Display) next-generation flat-panel displays, worked to develop a new electron source system that resulted in the successful creation of a prototype panel that achieved brightness, color and quality performance surpassing those realized by the earlier system. In recent years, however, faced with flat-panel television price declines that have been larger and more rapid than expected, Canon Inc. determined that securing appropriate profitability would prove difficult.

As a result, by the end of September this year, Canon Inc. will conclude all operations at SED Inc. With regard to SED technology, Canon Inc. plans to continue its SED panel-related research and development activities.

2. Overview of subsidiary to be liquidated

1. Name

: SED Inc.

2. Location

: 22-5 Tamura 9-chome, Hiratsuka City, Kanagawa

3. Representative

: Kazunori Fukuma, President

4. Business activities

: Development, production and marketing of SED panels

5. Capital

: 10,500.05 million yen

6. Date of establishment

: October 28, 2004

7. Equity structure

: Canon Inc.: 100%

3. Liquidation schedule (tentative)

September 30, 2010

Resolution to dissolve at extraordinary meeting of SED Inc. shareholders

September 30, 2010

SED Inc. dissolution date

Late December 2010

Completion of liquidation of SED Inc.

 Japan