Canaan Inc. (CAN) Announces Execution of a Securities Purchase Agreement

Canaan Inc. (NASDAQ: CAN) ("Canaan" or the "Company" or "We"), a leading high-performance computing solutions provider, today announced that it has entered into a securities purchase agreement (the "Securities Purchase Agreement") with an institutional investor (the "Buyer"), pursuant to which the Company shall issue and sell to the Buyer up to 30,000 Series A-1 Preferred Shares (the "Series A-1 Preferred Shares") at the price of US$1,000.00 for each Series A-1 Preferred Share. Canaan agreed that the proceeds from the sale of the Series A-1 Preferred Shares will be used by the Company and/or its subsidiaries to manufacture or invest in digital mining sites and equipment to be deployed or sold in North America, including any acquisition or disposition of assets from or between subsidiaries. The closing of the sale of the Series A-1 Preferred Shares under the Securities Purchase Agreement was conditioned upon general customary closing conditions.

The Company has adopted a certificate of designations (the "Certificate of Designations") of Series A-1 Preferred Shares, par value US$0.00000005 per share, creating the Series A-1 Preferred Shares and providing for the designations, preferences and relative, participating, optional or other rights, and the qualifications, limitations or restrictions thereof, of the Series A-1 Preferred Shares, which has become effective upon such adoption.

On September 30, 2024, the Company closed the third and final tranche of a Series A preferred shares financing under a securities purchase agreement with the Buyer, pursuant to which the Company agreed to issue and sell to the Buyer up to 125,000 Series A Convertible Preferred Shares.

"I am proud of our continued partnership with this institutional investor as I believe that their commitment to Canaan demonstrates the growing opportunity for the Company," said Nangeng Zhang, chairman and chief executive officer of Canaan. "In the year since we began our partnership, Canaan has made significant progress on our goals and is well-positioned as we head into what we believe could be another bull market for Bitcoin. Investments like these allow the Company to ensure the timely delivery of our products and to partner with our customers on self-mining projects. The ability to pursue multiple opportunities helps Canaan to be a strong competitor and partner in the Bitcoin mining industry."

The Securities Purchase Agreement contains customary representations, warranties and agreements by the Company and the Buyer, and indemnification obligations of the Company against certain liabilities, including for liabilities under the Securities Act of 1933, as amended. The provisions of the Securities Purchase Agreement, including the representations and warranties contained therein, are not for the benefit of any party other than the parties to such agreement and are not intended as a document for investors and the public to obtain factual information about the current state of affairs of the Company. Rather, investors and the public should look to other disclosures contained in the Company's filings with the SEC.

The foregoing description does not purport to be complete and is qualified in its entirety by reference to the full text of the Securities Purchase Agreement and the Certificate of Designations. The full text of the Securities Purchase Agreement and the Certificate of Designations are to be filed as exhibits to the Company's current report on Form 6-K dated on or around November 20, 2024. Capitalized terms used in this press release without definition shall have the meanings given to them in the Securities Purchase Agreement, the Certificate of Designations, and any amendments thereto.

This press release is for informational purposes only and is not an offer to sell or a solicitation of an offer to buy any securities, which is made only by means of a prospectus supplement and related prospectus. There will be no sale of these securities in any jurisdiction in which such an offer, solicitation of an offer to buy or sale would be unlawful.

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