Newton Energy Closes Private Placement, Plans for E&D in UK
Newton Energy Corporation has closed its previously announced private placement of 1,362,500 common shares of the Company at a price of $1.00 per Common Share for aggregate proceeds of $1,362,500. Pursuant to applicable securities legislation, the Common Shares issued pursuant to the Offering are subject to a hold period of four months and one day from the date of closing. This Offering completes the issue of up to ten million Common Shares previously approved by the shareholders of the Company at its Annual and Special meeting of Shareholders held on May 27, 2007.
Pursuant to the Offering, Wolverton Securities Limited was paid a cash commission of $13,625 and Harp Capital Corp. was paid cash commission of $81,750. In addition, the Company granted an aggregate of 136,250 agent's options exercisable into common shares at a $1.00 per share for a period of eighteen (18) months from the closing date.
The net proceeds of the Offering will be used to meet the exploration and development requirements of the Company's licenses awarded on 100,000 acres and an additional 50,000 acres which has been jointly allotted, pending final approval of the BERR in the United Kingdom, on 6 contiguous blocks in the Onshore East Midlands Basin area of the United Kingdom.
Following the closing of the Offering the Company has 14,011,021 common shares issued and outstanding.
The Company believes that the Onshore East Midlands Basin is an overlooked source of diverse prospects and has identified six prospects in the first stage of its drilling program. The Company is actively preparing applications to local County Councils in the United Kingdom for planning permission to develop and drill up to six sites, four of which are located in Nottinghamshire and one each in Leicestershire and Lincolnshire. The Company believes it has sufficient working capital to complete the first stage of its drilling program, subject to rig availability and cost. In addition, in order to better facilitate the Company's activities in the United Kingdom, Frey will be relocating to Nottingham in the fourth quarter.