Newton Energy Corporation
TSX VENTURE : NTN

September 14, 2007 18:23 ET

Newton Energy Corporation Announces First Closing of Private Placement

CALGARY, ALBERTA--(Marketwire - Sept. 14, 2007) - Newton Energy Corporation ("Newton" or the "Company") (TSX VENTURE:NTN) (new symbol to be NEC) is pleased to announce a first closing of $2,437,750 through the issuance of 4,875,500 Subscription Receipts (the "Subscription Receipts") of the Company at a price of $0.50 per Subscription Receipt in connection with its previously announced private placement of a minimum of $2,000,000 and up to a maximum of $5,000,000 of Subscription Receipts (the "Offering"). Each Subscription Receipt will be deemed to be exchanged, without payment of any additional consideration, for one consolidated common share of the Company ("Common Share"), with 15% of each subscriber's Subscription Receipts issuable upon closing and 85% issuable upon the Second Release Date (as defined herein). Following the closing of the Offering the Company has 4,742,586 common shares issued and outstanding. The securities issued pursuant to the Offering are subject to a four month hold period.

Pursuant to the Subscription Receipt Agreement dated September 12, 2007 among the Company, CIBC Mellon Trust Company ("CIBC") and Wolverton Securities Ltd. ("Wolverton"), the Company upon closing was paid 15% of the gross proceeds of the Offering in the amount of $213,558.04. The remaining 85% of the gross proceeds were deposited into escrow with CIBC, as escrow agent, to be released to the Company when the Company is awarded by the UK Department of Trade and Industry not less than 65,000 acres of exploration licenses in the 13th Round of Onshore Licensing within the United Kingdom (the "Second Release Date"). The proceeds of the Offering will be used to meet the Company's obligations related to expected work commitments for the licenses it may obtain.

Wolverton, as agent, was paid a cash commission of $125,935 of the gross proceeds of the Offering and was granted 487,500 Agent's Options pursuant to the Agency Agreement dated September 12, 2007 (the "Agency Agreement") between the Company and Wolverton.

ADVISORY:

Investors are cautioned that, except as disclosed in the management information circular dated May 2, 2007 prepared in connection with the Transaction and the Public Record, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of NEC should be considered highly speculative and exchange trading in the securities will remain halted until the Transaction has been completed and all approvals obtained.

Certain information regarding Newton Energy Corporation including managements assessment of future plans and operations, may constitute forward-looking statements under applicable securities laws and necessarily involve risks associated with production, marketing and transportation such as loss of market, volatility of prices, currency fluctuations, environment risks, competition from other producers and ability to assess sufficient capital from those anticipated in the forward-looking statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Newton Energy Corporation
    Michael Frey
    President and CEO
    (403) 514-9900
    or
    Newton Energy Corporation
    Suite 107, 6227 - 2nd Avenue S.E.
    Calgary, Alberta T2H 1J5
    Email: newtonenergy@shaw.ca