The companies allegedly structured a deal so it would not be delayed by U.S. pre-merger notification laws.
The company also says it will buy back 40% of its outstanding shares.
The deal signals Sharp’s reentry into PCs, a business it abandoned in 2010.
The company sought higher pay from the U.S. Bankruptcy Court for the acting finance chief and his boss.
The company's auditor refuses to certify its Q3 results in “a highly unusual signal of doubt about [its] ability to recover its financial health."
Cost overruns at Westinghouse Electric power plants have contributed to Toshiba's financial woes, forcing a $6.3 billion writedown.
The credit rating agency warns of "a growing likelihood that Toshiba will become unable to fulfill its financial obligations in a timely manner."
The losses from Toshiba power projects "could topple a company whose roots go back to 1875, the dawn of Japan’s modern era."
The beleaguered company needs cash to offset an imminent writedown that Japanese media have estimated at $6 billion.
The potential hit of several billion dollars "may further undermine confidence in company management" after its accounting scandal.
Analysts had long expected the big decrease in the operation's goodwill.
Toshiba reportedly granted Canon preferential negotiating rights after it offered $6 billion for Toshiba's medical equipment business.
