The former MVP was declared healthy Monday after passing a physical the team and his agency organized, a source told ESPN's Adam Schefter.
"Cam has meant a lot to this organization and the Carolinas," general manager Marty Hurney said in a statement. "Everyone saw his performances on the field. I had the privilege of seeing how hard he worked off the field, and his commitment to this team when no one was watching.
"He's the ultimate competitor and it physically hurts him to lose. He willed this team to victory on many occasions and will always be considered one of the greatest players in the history of this franchise. His contributions to this team, this community, and the game of football will leave a lasting impact on our organization."
Carolina drafted the now 30-year-old first overall in 2011, and the charismatic signal-caller quickly ascended to stardom. He was named MVP in 2015 while leading the Panthers to Super Bowl 50, which they lost to the Denver Broncos.
The team signed Teddy Bridgewater to a lucrative three-year contract during free agency, spelling the end of Newton's time in Carolina.
Newton was released less than two months after leaving a meeting with Hurney, owner David Tepper, and first-year head coach Matt Rhule feeling "inspired." The veteran said he was confident about remaining in Carolina for the 2020 season.
The Panthers granted the three-time Pro Bowler permission to seek a trade once it became clear they were moving on from him, but no deal materialized. Carolina unsuccessfully tried to send Newton to the Chicago Bears or Los Angeles Chargers, according to Ian Rapoport of NFL Network. His recent injury history and salary of $19.1 million in 2020 were presumably the obstacles.
Carolina went 68-55-1 in the regular season and 3-4 in the playoffs in games Newton started.