Tonbridge Power Inc. to be Acquired by Enbridge Inc.

TORONTO, Aug. 16, 2011 /CNW/ -- 
TSX Venture Exchange
Symbol: TBZ


TORONTO, Aug. 16, 2011 /CNW/ - Tonbridge Power Inc. (TSXV-TBZ) ("Tonbridge" or the "Corporation"), announced today that it has entered into a definitive agreement to
 be acquired by Enbridge Inc. (TSX:ENB) ("Enbridge") through a plan of arrangement for $0.54 per share in cash (the "Arrangement"), representing a premium of 116% to Tonbridge's closing share price of
 $0.25 on August 8, 2011 and a premium of 74% to the 20-day volume
 weighted average trading price of $0.31 as of August 8, 2011. The
 Tonbridge shares were halted from trading at the request of Tonbridge
 before market open on August 9, 2011.  Pricing in respect of the
 Arrangement was based, in part, on management's updated determination
 that at least US$50 million in additional funding is required to
 complete the construction of the Corporation's Montana Alberta Tie Ltd.
 ("MATL") transmission line project (the "MATL Project"). The agreement is subject to Tonbridge shareholder approval,
 regulatory approval and other closing conditions.


Tonbridge also announced that it has entered into a settlement agreement
 with its EPC contractor in respect of construction activities on the
 MATL Project.  The Corporation is in negotiations with a number of
 parties in order to effect a resumption of construction as quickly as
 possible with a view to meeting the Corporation's goal of delivering an
 operating transmission line by mid-2012.


 "We are pleased to effect this transaction as it addresses both
 Tonbridge's capital and project needs while at the same time giving our
 shareholders value for their investment. We look forward to completing
 the MATL Project and accelerating our development of future projects as
 a part of Enbridge," said Robert van Beers, Tonbridge Chief Executive
 Officer.


Acquisition of Tonbridge


Under the Arrangement, in addition to acquiring all of the outstanding
 common shares of Tonbridge, Enbridge will repay approximately $50
 million of debt incurred in the development of the Corporation's MATL
 Project to date.  Enbridge may be entitled to receive approximately $9
 million in a combination of cash and warrants should the Arrangement
 not be completed.


Tonbridge's Board of Directors, after receiving the recommendation of
 its Special Committee and consulting with its financial and legal
 advisors, has unanimously determined that the Arrangement is in the
 best interest of the Corporation and its shareholders and to recommend
 that Tonbridge shareholders vote in favour of it.  Stephens Inc. and
 J.J.R. Capital Corp. have acted as financial advisors to the
 Corporation.  Clarus Securities Inc., acting as financial advisor to
 the Special Committee, has provided an opinion that the consideration
 to be received by Tonbridge shareholders is fair, from a financial
 point of view, to Tonbridge shareholders.  A complete copy of the
 opinion will be appended to Tonbridge's management information circular
 in respect of the Arrangement.


The directors, senior officers and certain institutional shareholders of
 Tonbridge, holding together approximately 22.4% in the aggregate of the
 issued and outstanding common shares of Tonbridge, have entered into
 lock-up agreements under which they have agreed to vote in favour of
 the Arrangement.


Additional Transaction Details


The terms and conditions of the Arrangement will be summarized in a
 management information circular, which is expected to be mailed to
 Tonbridge shareholders before the end of August and filed on SEDAR.


The Arrangement will be subject, among other things, to the approval of
 at least 66 ⅔% of the votes cast at a special meeting of Tonbridge
 shareholders to be called to consider the Arrangement. In addition, the
 Arrangement will be subject to certain customary conditions, including
 court approval, relevant regulatory approvals and the absence of any
 material adverse effect with respect to the Corporation.


The transaction is expected to close before September 30, 2011, subject
 to the satisfaction or waiver of various closing conditions.


Settlement Agreement with EPC Contractor


Tonbridge has settled all outstanding disputes with Rocky Mountain
 Contractors ("RMC"), and has terminated all aspects of its contractual relationship with
 respect to the engineering, procurement and construction contract with
 RMC to build the MATL Project.


In consideration for unpaid invoices, change requests and other claims
 as well as for agreeing to terminate this contract on amicable terms,
 MATL has agreed to forfeit US$12 million in security that RMC is
 holding in escrow against payables in respect of labour, equipment and
 certain materials as well as pay a further US$1 million.  The
 Corporation has also agreed to the following other elements in respect
 of the settlement agreement: (i) MATL has agreed to take assignment of
 all of RMC's subcontractors associated with the MATL Project and will
 take responsibility, at its expense, for all remediation work in
 connection with the MATL Project; and (ii) MATL will also pay RMC
 approximately US$1.7 million for materials and equipment invoiced and
 payable under an arrangement with under the Western Area Power
 Administration.  Under this arrangement, MATL will receive
 reimbursement once it has settled this account. Future purchase orders
 under this arrangement will become the responsibility of MATL.  MATL
 has also agreed to release RMC from all future liabilities and
 obligations arising from the EPC contract including RMC's specific
 warranty obligations under the contract related to the MATL Project.


In consideration of the above, RMC has agreed to remove all liens
 associated with MATL and the MATL Project.  RMC has also covenanted to
 work quickly to enable an efficient transfer of all MATL Project
 related assets and materials including, crossing agreements, IFC
 drawings, subcontractor information, yards, residual equipment, MATL
 Project related data, permits, matting and other matters necessary for
 MATL to smoothly transition the contract to a new contractor(s). RMC
 retains responsibility for any financial obligations to subcontractors
 that occurred up to the date of this agreement and covenants to ensure
 that all subcontractors, leases and suppliers will be paid within 30
 days of this agreement for work completed but not yet invoiced and any
 liens resulting from failure to pay will be RMC's responsibility.  All
 transferable manufacturers and subcontractor warranties will be
 transferred to MATL and in the event that these are not transferrable
 RMC will hold those warranties for MATL's benefit. RMC has agreed to
 release MATL from all future liabilities and obligations arising from
 the EPC contract and the MATL Project with the exception of those
 spelled out in the agreement.


The settlement and the termination of its relationship on amicable terms
 with RMC enables MATL to re-start construction of the MATL Project with
 other contractors and avoids costly and time consuming litigation.


Tonbridge Power Inc. is a Toronto-based developer of electrical transmission assets, whose
 principal asset is a 100% interest in Montana Alberta Tie Ltd.  Shares
 of the Corporation are traded on the TSX Venture Exchange under the
 symbol "TBZ". The Corporation's financial statements and other filings
 can be found on SEDAR.


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Cautionary Note Regarding Forward-Looking Statements


This news release contains "forward-looking statements", within the
 meaning of applicable Canadian securities legislation, concerning the
 business, operations and financial performance and condition of the
 Corporation. Forward-looking statements include, but are not limited
 to, statements with respect to the acquisition of Tonbridge and the
 costs and timeline to complete the MATL Project. Generally, these
 forward-looking statements can be identified by the use of
 forward-looking terminology such as "plans", "expects" or "does not
 expect", "is expected", "budget", "scheduled", "estimates",
 "forecasts", "intends", "anticipates" or "does not anticipate", or
 "believes", or variations of such words  and phrases or statements that
 certain actions, events or results "may", "could", "should", "would",
 "might" or "will be taken", "occur" or "be achieved". Forward-looking
 statements are subject to known and unknown risks, uncertainties and
 other factors that may cause the actual results, level of activity,
 performance or achievements of the Corporation to be materially
 different from those expressed or implied by such forward-looking
 statements, including but not limited to: the conditionality of the
 revenue contracts, risks related to the financing or construction of
 the transmission line; risks related to the performance of parties
 contracting for transmission capacity; delays in obtaining governmental
 approvals, permits or project financing or in the completion of
 development or construction activities, requirements for additional
 capital, government regulation, environmental risks as well as those
 factors discussed in the Corporation's MD&A for the three months ended
 March 31, 2011 available on www.sedar.com. Although the Corporation has attempted to identify important factors
 that could cause actual results to differ materially from those
 contained in forward-looking statements, 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. The Corporation
 does not undertake to update any forward-looking statements that are
 incorporated by reference herein, except in accordance with applicable
 securities laws.


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


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p Robert McFarlane, Chief Financial Officerbr/ [phone]  email: a href="mailto:[e-mail]"[e-mail]/a /p p align="left" Brisco Capital Partners Corp.br/ Graeme A. Dick, Partnerbr/ [phone]  email: a href="mailto:[e-mail]"[e-mail]/a /p p align="left" Please Visit the Company's Website at: a href="http://www.tonbridgepower.com/"www.tonbridgepower.com/a /p 

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