Newton Energy Corporation Announces Letter of Intent for a Proposed Reverse Takeover Transaction

CBJ Newsmakers


CALGARY, Alberta, Dec. 04, 2018 (GLOBE NEWSWIRE) — Newton Energy Corporation (TSXV:NTN.H) (the “Company” or “Newton”) announces that it has entered into a non-binding letter of intent (“LOI”) with Verano Holdings, LLC (“Verano”), a US-based company involved in the growing and distribution of cannabis and cannabis related products in the United States. The LOI outlines the proposed terms and conditions pursuant to which the Company and Verano will effect a business combination that will result in a reverse takeover of the Company by the securityholders of Verano (the “Proposed Transaction”) and the listing for trading of the securities of the resulting issuer (the “Resulting Issuer”) on the Canadian Securities Exchange (the “CSE”).

Verano is a vertically integrated US-based cannabis company with material revenue operating in a number of States. Further details concerning Verano, its operations, management and financial status will be provided following completion of due diligence investigations and the negotiation of a definitive agreement in respect of the Proposed Transaction (the “Definitive Agreement”). Until then, confidentiality provisions preclude the disclosure of certain information concerning Verano.

The Proposed Transaction

The Proposed Transaction will be structured as an amalgamation, arrangement, takeover bid, share purchase or other similar form of transaction or a series of transactions determined by the legal and tax advisors to each of Newton and Verano. The final structure for the Proposed Transaction will be determined after Newton and Verano have considered all applicable tax, securities law and accounting considerations. It is anticipated that Verano or a company established for the purpose of so doing will conduct a private placement of subscription receipts in conjunction with the Proposed Transaction for an amount to be determined.

Completion of the Proposed Transaction is subject to a number of conditions, including the negotiation and signing of a Definitive Agreement, receipt of all necessary securityholder and regulatory approvals, approval from the NEX board of the TSX Venture Exchange (the “NEX”) for the delisting of the common shares of Newton (the “Newton Shares”) from the NEX and conditional approval of the CSE for the listing of the Newton Shares following completion of the Proposed Transaction.

In connection with the Proposed Transaction, the Company will be required to, among other things:

  1. change its name to a name requested by Verano and acceptable to applicable regulatory authorities;
  2. consolidate its outstanding Newton Shares on a basis to be determined by the Company and Verano; and
  3. replace the directors and officers of the Company on closing of the Proposed Transaction with nominees of Verano.

Upon successful completion of the Proposed Transaction, the Resulting Issuer will carry on the business currently carried on by Verano. There can be no guarantees that the Proposed Transaction will be completed as proposed or at all.

The Newton Shares will remain halted until all necessary filings have been accepted by applicable regulatory authorities. Unless the Proposed Transaction fails to close, the Company does not expect the Newton Shares to resume trading again until the listing has been accepted by the CSE.

Further comprehensive information regarding the Proposed Transaction will be provided in a future press release at such time the parties execute a Definitive Agreement.



Gino DeMichele
President and Chief Executive Officer
Phone: (403) 680-7898

Neither the NEX nor its Regulation Services Provider (as that term is defined in the policies of the NEX) accepts responsibility for the adequacy or accuracy of this news release.


Certain statements in this press release are forward-looking statements and are prospective in nature. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements, including: the receipt of all necessary regulatory approvals, the ability to conclude the Proposed Transaction, capital expenditures and other costs, and financing and additional capital requirements. These statements generally can be identified by the use of forward-looking words such as “may”, “should”, “will”, “could”, “intend”, “estimate”, “plan”, “anticipate”, “expect”, “believe’’ or “continue”, or the negative thereof or similar variations. Forward-looking statements in this news release include statements regarding the completion of the Proposed Transaction, the listing of the shares of the Resulting Issuer on the CSE and the anticipated business plan of the Company subsequent to completion of the Proposed Transaction. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward looking information. The Company assumed no obligation to update any forward-looking statements or forward-looking information that are incorporated by reference herein, except as required by applicable securities laws.