Northern Frontier Corp. Provides Update on Proposed Public Offering of Subscription Receipts and the Proposed Acquisition of ...

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CALGARY, July 4, 2013 /CNW/ - Northern Frontier Corp. (TSX-V: FFF.P) (the "Corporation" or "Northern Frontier") would like to advise that it is continuing to pursue its proposed public offering of subscription receipts ("Offering") and proposed acquisition of 794522 Alberta Ltd. ("Numberco"), NEC Contractors (2012) Inc. ("NEC" and together with Numberco, the "NEC Group") and certain assets ("Carve-out Assets") of CRC Open Camp & Catering Ltd. ("CRC"), held by CRC and used in the NEC Group business (together with the transactions contemplated by the Share Purchase Agreement, the "Acquisition") as announced on April 23, 2013.

The NEC Group provides sustaining capital services to large industrial energy customers in the steam assisted gravity drainage ("SAGD") region of northeastern Alberta.  The NEC Group's head office and shop is located in Lac La Biche, Alberta and its field location is in Conklin, Alberta which is central to the substantial industrial energy production developments in the vicinity. The business focuses on the ongoing demand for services to support operating facilities, sustaining capital expenditures to maintain production levels of those facilities and the development of new production capacity.

Based on unreviewed and unaudited financial figures prepared by management of the NEC Group, the NEC Group and CRC Carve-out Assets generated Q1 2013 revenue of approximately $19.0 million and pro forma adjusted earnings before interest, taxes, depreciation and amortization ("Adjusted EBITDA") of approximately $5.5 million (margin of 28.9%). This compares to $42.6 million in revenue and $11.2 million in pro forma Adjusted EBITDA (margin of 26.2%) for the twelve months of 2012.

The Corporation is in the process of updating the Preliminary Prospectus that it filed on April 23, 2013, to reflect the first quarter financial results of the Corporation, the NEC Group and CRC Carve-out Assets and related required financial information disclosure. Once complete, the Corporation intends on filing the Amended and Restated Preliminary Prospectus. The definitive date of filing has not been determined, however the Corporation is working diligently to complete the filing and expects to proceed in an expeditious manner once sufficient financing is obtained.

Regulatory Matters

The Corporation will apply for an exemption from sponsorship requirements pursuant to Exchange Policy 2.2 - Sponsorship and Sponsorship Requirements. There is no assurance, however, that it will obtain this exemption. Trading in the Common Shares will remain halted until such time as the Exchange has received the documentation required by Policy 2.4 - Capital Pool Companies.

Completion of the Acquisition is subject to a number of conditions including, but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the Acquisition cannot close until the required shareholder approval is obtained. There can be no assurance that the Acquisition will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the Prospectus of the Corporation, any information released or received with respect to the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange Inc. has in no way passed upon the merits of the Acquisition and has neither approved nor disapproved the contents of this news release.

Non-GAAP Measures

Adjusted EBITDA

"Adjusted EBITDA" is defined as earnings before interest, taxes, depreciation and amortization and other specific expenses and exclusive of the charges paid to CRC for the rental of the CRC Carve-out Assets net of associated costs incurred by CRC related to these assets. Adjusted EBITDA is a supplemental non-GAAP financial measure that is not recognized under IFRS and does not have a standardized meaning prescribed by IFRS.  Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net profit and comprehensive income or cash flows from operating activities as determined in accordance with IFRS or as an indicator of operating performance or liquidity.  Management believes that Adjusted EBITDA is a useful supplemental measure as it provides an indication of the results generated by the principal business activities after considering CRC's related party relationship with the NEC Group and prior to consideration of how these activities are financed or how the results are taxed in various jurisdictions.  The computations of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies, and accordingly Adjusted EBITDA may not be comparable to measures used by other companies.

Forward Looking Information

This news release includes certain statements that constitute forward-looking statements under applicable securities legislation. All statements other than statements of historical fact are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", or the negative of these terms or other comparable terminology. These statements are made as of the date of this news release and the Corporation does not undertake to publicly update these forward-looking statements except in accordance with applicable securities laws. These forward-looking statements include, among other things:

• completion of the Acquisition and the Offering;
• filing of the Amended and Restated Preliminary Prospectus;
• operating activities and future financial performance;
• use of net proceeds from the Offering; and
• terms and conditions of the Acquisition.

These statements are only predictions and are based on current expectations, estimates, projections and assumptions, which the Corporation believes are reasonable but which may prove to be incorrect and therefore such forward-looking statements should not be unduly relied upon. In making such forward-looking statements, assumptions have been made regarding, among other things, industry activity, marketability of the services of the NEC Group, the state of financial markets, business conditions, continued availability of capital and financing, future oil and natural gas prices and the ability of the Corporation to obtain necessary regulatory approvals. Although the Corporation believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements.

By its nature, forward-looking information involves numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. These risks and uncertainties include: the possibility that the parties will not proceed with the Acquisition and the Offering, that the ultimate terms of the Acquisition and the Offering will differ from those that are currently contemplated, that the Acquisition and Offering will not be successfully completed for any reason (including the failure to obtain the required approvals from regulatory authorities) and regulatory changes. Investors are cautioned that forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the Corporation, investors should review the Corporation's continuous disclosure filings that are available at www.sedar.com.

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

SOURCE Northern Frontier Corp.

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