FFF.P Northern Frontier Corp

NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES.


Northern Frontier Corp. (TSX VENTURE:FFF.P) (the "Corporation" or "Northern
Frontier"), a TSX Venture Exchange (the "TSX-V") listed capital pool
corporation, is pleased to announce the completion of its previously announced
acquisition of the NEC Group (as defined below) and certain assets used in the
operation of the NEC Group's business (the "Transaction"). The Transaction
constitutes Northern Frontier's qualifying transaction for purposes of the rules
of the TSX-V.  


The NEC Group provides sustaining capital services to large industrial energy
customers in the steam assisted gravity drainage region of northeastern Alberta.
Specifically, the NEC Group provides civil services related to the construction
and maintenance of roads, production pads, piping corridors, facility earthworks
and infrastructure. Service demand is driven by the need of producing facilities
to replace depleting production wells and pads and develop the interconnecting
infrastructure to transport produced hydrocarbons to central processing
locations. The NEC Group's head office and shop is located in Lac La Biche,
Alberta and its field location is in Conklin, Alberta, both of which are central
to the substantial industrial energy production developments in northeastern
Alberta.  


Chris Yellowega, newly appointed President and Chief Executive Officer of the
Corporation said, "We believe that the NEC Group's proximity to client
operations, localized workforce and convenient infrastructure provides an
advantage in the marketplace. When clients have need of immediate response from
a local provider, the NEC Group is a natural choice. We anticipate that the
market in which the NEC Group operates will have opportunity for growth and that
the NEC Group provides a platform to help capitalize on this opportunity." 


Following the completion of the Transaction, in addition to Chris Yellowega
being appointed as the President and Chief Executive Officer of the Corporation,
Monty Balderston was appointed as the Executive Vice President, Chief Financial
Officer and Corporate Secretary of the Corporation. Mr. Yellowega has also been
appointed as a director of the Corporation. The Board of Directors of the
Corporation is currently comprised of nine directors: Brad Creswell, John
Jacobs, Trevor Haynes, Darin Coutu, Ted Redmond, Don Basnett, Darrell Peterson,
Rob Hunt and Chris Yellowega. Summaries of the biographies for all of the
directors and senior officers of the Corporation are set out in the final long
form prospectus of the Corporation, dated September 4, 2013, filed in connection
with the public offering of subscription receipts of the Corporation (the
"Prospectus"). The Prospectus is available on the SEDAR website at www.sedar.com
under the Corporation's profile. 


Details of the Transaction 

The Transaction consisted of the acquisition of: (i) all of the issued and
outstanding shares of 794522 Alberta Ltd. and its wholly-owned subsidiary NEC
Contractors (2012) Inc. (collectively, the "NEC Group"); and (ii) certain assets
of CRC Open Camp & Catering Ltd. used in the business of the NEC Group (the "CRC
Carve-out Assets").  


The Transaction was completed pursuant to the terms of a share purchase
agreement among the Corporation, the NEC Group and the shareholders of the NEC
Group, and an asset purchase agreement among the Corporation and CRC Open Camp &
Catering Ltd. Copies of the share purchase agreement and asset purchase
agreement are available on the SEDAR website at www.sedar.com under the
Corporation's profile. 


The aggregate purchase price payable by the Corporation in connection with the
Transaction was approximately $55.7 million, comprised of: (i) $49.7 million in
cash (including closing indebtedness paid directly to creditors); (ii) $5.0
million in common shares ("Common Shares") and warrants ("Warrants") of the
Corporation (1,428,571 Common Shares at a deemed price of $3.50 and 714,286
Warrants with an exercise price of $4.00 expiring 18 months after the closing
date of the Transaction); and (iii) $1.0 million in a deferred cash payment
(payable on March 31, 2014). The Common Shares issued to the vendors as part of
the purchase price (the "Escrow Securities") are subject to the terms of an
escrow agreement for a period of 18 months following the closing date of the
Transaction. The Escrow Securities may be transferred to Northern Frontier in
satisfaction of successful indemnity claims made by the Corporation against the
vendors. 


The completion of the Transaction has been conditionally accepted by the TSX-V.
Final acceptance is expected to be received after completion of the required
filings. Trading in the Common Shares currently remains halted until such time
as the TSX-V has received the documentation required by TSX-V Policy 2.4 -
Capital Pool Companies; however, it is currently expected that the Common Shares
and the Warrants will commence trading on or about October 2, 2013. 


Financing the Transaction 

The cash portion of the purchase price of the Transaction was funded by: (i) the
previously-completed public offering of 5,231,950 subscription receipts (the
"Subscription Receipts") at a price of $3.50 per Subscription Receipt for total
gross proceeds of approximately $18.3 million; and (ii) a credit facility and
subordinated credit facility led by certain Canadian financial institutions, as
further described below. 


Subscription Receipt Offering 

On September 12, 2013, the Corporation completed the public offering of the
Subscription Receipts. On the completion of the Transaction, each Subscription
Receipt was automatically converted into one Common Share and one-half of one
Warrant. Each full Warrant entitles the holder to acquire one Common Share at a
price of $4.00 per share for a period of 18 months following the closing date of
the Transaction. The Corporation engaged GMP Securities L.P. and Raymond James
Ltd. as co-lead agents, together with Acumen Capital Finance Partners Limited
and Cormark Securities Inc., to act as agents for the offering and granted the
Agents an option to purchase up to such number of additional Subscription
Receipts and/or Common Shares and Warrants (as applicable, depending on when
exercised) as is equal to 15% of the number of Subscription Receipts sold under
the offering to cover over-allotments, if any, and for market stabilization
purposes. The unexercised portion of the over-allotment option is exercisable,
in whole or in part, until October 12, 2013. 


After giving effect to the Transaction (including the issuance of Common Shares
and Warrants to the vendors) and the conversion of the publicly-issued
Subscription Receipts into Common Shares and Warrants, there are 7,579,054
Common Shares issued and outstanding (on a non-diluted basis), and 3,330,261
Warrants and 157,902 options to purchase Common Shares outstanding. In addition,
498,000 options to purchase Common Shares are intended to be granted once the
Common Shares commence trading and the market establishes a price on which such
options can be granted. 


Credit Facilities 

Concurrently with the closing of the Transaction, the Corporation established a
senior credit facility (the "Credit Facility") with a Canadian chartered bank,
and has utilized $22.5 million of the Credit Facility to fund a portion of the
purchase price of the Transaction and for general working capital purposes. The
Credit Facility consists of: (i) a $15.0 million committed revolving extendible
credit facility; (ii) a $25.0 million committed revolving reducing extendible
term loan; (iii) a $2.0 million committed term loan; (iv) a treasury risk
management facility subject to a limit of $1.0 million; and (v) a corporate
MasterCard for up to $0.5 million.  


In addition, the Corporation has established a $12.0 million five-year term
subordinated credit facility (the "Subordinated Facility", and collectively with
the Credit Facility, the "Credit Facilities") with a Canadian financial
institution and Claryn Equities Inc., a company controlled by Trevor Haynes, a
director of the Corporation, as lenders. The Subordinated Credit Facility has
also been utilized to fund a portion of the purchase price of the Transaction.
Claryn Equities Inc.'s participation in the Subordinated Facility is in the
amount of $1.0 million and is on terms identical to the terms applicable to
Canadian financial institution as co-lender.  


Forward Looking Information 

This news release includes 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". These statements are made as of the date of this news release and
the Corporation does not undertake to publicly update them except in accordance
with applicable securities laws. These forward-looking statements include
trading of the Common Shares and Warrants on the TSX-V and the timing thereof;
final TSX-V approval in respect of the Transaction; and anticipated growth in
the industry in which the NEC Group operates. 


These statements are based on certain assumptions including, but not limited to,
the receipt of applicable regulatory approvals and the terms applicable thereto,
the supply and demand for oilfield services and industry activity levels, the
Corporation's ability to obtain qualified staff and equipment in a timely and
cost-efficient manner, the ability of the Corporation to successfully execute on
its growth strategies, stable currency valuations, and a sufficiently stable
global financial and economic environment. Although the Corporation believes the
assumptions relied upon are reasonable, such forward-looking statements are not
guarantees of future outcome and should not be unduly relied upon. 


By their nature, forward-looking statements involve numerous risks that the
predictions, forecasts or projections will not occur. These risks include
adverse developments in general economic, political, market and business
conditions in Canada and elsewhere, a decrease in the demand for oilfield
services, commodity price volatility, fluctuations in currency exchange rates,
increased competition, the inability to access capital or qualified personnel,
adverse actions by governmental authorities, including regulatory, environmental
and taxation policies and other changes, many of which are beyond the control of
the Corporation. For more information on the Corporation, investors should
review the Corporation's continuous disclosure filings that are available at
www.sedar.com under the Corporation's profile. 


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


FOR FURTHER INFORMATION PLEASE CONTACT: 
Northern Frontier Corp.
Chris Yellowega
President and Chief Executive Officer
403.880.9511
cyellowega@frontieracquisition.com


Northern Frontier Corp.
Monty Balderston
Executive Vice President and Chief Financial Officer
403.874.7408
mbalderston@frontieracquisition.com

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