TORONTO, Aug. 31, 2022 (GLOBE NEWSWIRE) -- This press release is being disseminated as required by National Instrument 62‐103 ‐ The Early Warning System and Related Take Over Bids and Insider Reporting Issuers in connection with the filing of an early warning report (the “Early Warning Report”) by Noman A. Worthington, III in respect of his ownership position in Sangoma Technologies Corporation (TSX: STC; Nasdaq: SANG) (the “Corporation”).

On March 31, 2021, the Corporation acquired of all of the shares of StarBlue Inc. (“StarBlue”) pursuant to the terms of a stock purchase agreement dated as of January 28, 2021 between, inter alia, the Corporation, StarBlue and Star2Star Holdings, LLC (“S2S Holdings”) (the “Acquisition Agreement”).

As partial consideration for its acquisition of StarBlue (the “Transaction”), the Corporation agreed to issue a total of 110,000,000 pre-Consolidation (as defined below) Shares (the “Consideration Shares”), of which 22,000,0000 pre-Consolidation Shares (less 869,202 pre-Consolidation Shares representing a holdback for indemnification purposes) were issued upon the completion of the Transaction (the “Initial Consideration Shares”) with the balance (the “Deferred Consideration Shares”) to be issued in quarterly installments commencing on April 5, 2022.

Prior to the completion of the Transaction S2S Holdings (which is controlled by Mr.Worthington) was StarBlue’s largest shareholder and, in its capacity as such, received 15,142,778 pre-Consolidation Initial Consideration Shares. S2S Holdings was also entitled to receive 88,687,156 pre-Consolidation Deferred Consideration Shares in accordance with the distribution schedule set out in the Acquisition Agreement.

On November 2, 2021, the Corporation consolidated its Common Shares on the basis of one new Share for every seven outstanding Shares (the “Consolidation”).

In May 2022, S2S Holdings distributed all of its Initial Consideration Shares to its owners, including Old Town Gelato, LLC (“OTG”). Mr. Worthington owns and controls OTG.

As of the date hereof, the Corporation has issued a total of 1,714,286 post-Consolidation Deferred Consideration Shares to S2S Holdings, representing the April 2022 and July 2022 installments. Each installment of the Deferred Consideration Shares, less a portion that is retained for sale in order to fund certain tax liabilities associated with the distribution of the Deferred Consideration Shares, is immediately distributed to the owners of S2S Holdings, including OTG.

As a result of the foregoing distributions of Initial Consideration Shares and Deferred Consideration Shares, OTG currently owns a total of 2,035,346 Shares, representing approximately 9.1% of the 22,296,476 Shares outstanding (being 21,439,332 Shares outstanding as of May 12, 2022 as disclosed in the Corporation’s Management Discussion and Analysis for the three and nine month periods ended March 31, 2022, dated May 12, 2022 (the “MD&A”) plus 857,144 post-Consolidation Deferred Consideration Shares issued since the date of the MD&A).

In addition, Mr. Worthington expects that, on or about October 31, 2022, OTG will receive its share of (i) the October 2022 installment of Deferred Consideration Shares (expected to be 449,405 Shares, less any Shares withheld to fund tax liabilities) and (ii) the Initial Consideration Shares that were originally held back for indemnification purposes under the Acquisition Agreement (the “Holdback Shares”) and are now being released (expected to be 65,103 Shares). Because OTG expects to receive these Shares within 60 days of the date hereof, it is now deemed to beneficially these Shares.

Therefore, after giving effect to the October 2022 distribution of Deferred Consolidation Shares and the Holdback Shares, Mr. Worthington will beneficially own or control a total of 2,549,854 Shares, representing approximately 10.9% of the 23,218,723 Shares outstanding (being the 21,439,332 Shares outstanding as of May 12, 2022 as disclosed in the MD&A plus (i) 857,144 post-Consolidation Deferred Consideration Shares issued since the date of the MD&A, (ii) 857,144 Shares issuable pursuant to the October 2022 distribution of Deferred Consolidation Shares and (iii) 65,103 Holdback Shares expected to be issued concurrently with the October 2022 distribution of the Deferred Consolidation Shares).

The Consideration Shares were and will be acquired by Mr. Worthington and OTG in connection with the Transaction and are held for investment purposes. S2S Holdings is entitled to receive the remaining distributions of Deferred Consideration Shares in accordance with the terms of the Acquisition Agreement, and Mr. Worthington expects that these additional Deferred Consideration Shares will be distributed to the owners of S2S Holdings, including OTG, in a manner consistent with previous distributions. Mr. Worthington or OTG may or may not, depending on market and other conditions, also increase or decrease their beneficial ownership or control of the Shares.

A copy of the Early Warning Report to be filed by Mr. Worthington in connection with the transactions described above will be available on the Corporation’s SEDAR profile at www.sedar.com.

The head office of the Corporation is located at Suite 100, 100 Renfrew Drive, Markham, Ontario L3R 9R6 and Mr. Worthington’s address is c/o Sangoma Technologies Corporation, Suite 100, 100 Renfrew Drive, Markham, Ontario L3R 9R6.

To obtain a copy of the Early Warning Report filed under National Instrument 62-103, please contact Samantha Reburn, General Counsel of the Corporation, at 1-905-474-1990 ext. 4134.