Offer to purchase CLEARNET.pdf - About TELUS

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TELUS CORPORATION (FORMERLY BCT.TELUS COMMUNICATIONS INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 1999 21. DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (Continued) The following is a restatement of cash flows to reflect the application of U.S. GAAP: 1999 (millions) 1998 Operating Activities Net income (loss) .............................................. $ 449.3 $(369.1) Depreciation and amortization ..................................... 1,036.0 463.6 Write-down of assets due to impairment .............................. — 762.8 Deferred income taxes ........................................... 94.6 (9.7) Non-cash restructuring related write-offs .............................. 7.4 — Gain on disposal of property and investments .......................... (36.9) — Sinking fund earnings ........................................... (11.6) — Other, net .................................................... (21.6) (11.9) Operating cash flow ............................................. 1,517.2 835.7 Provision for future cash restructuring costs ........................... 147.8 — Changes in working capital ....................................... (44.4) (41.4) Cash from operations ........................................... 1,620.6 794.3 Less — dividends to shareholders ................................... (334.9) (176.2) Investing Activities 1,285.7 618.1 Purchase of TELUS ............................................ (110.7) — Capital expenditures, net ......................................... (1,161.7) (579.3) Change in investments and other assets .............................. 12.6 (38.2) Proceeds from the sale of property and investments ..................... 40.2 — Net proceeds on disposition of discontinued operations ................... — 43.6 Other ....................................................... — 5.9 Financing Activities (1,219.6) (568.0) Common shares issued .......................................... 3.5 3.7 Long-term debt issued ........................................... 39.8 9.9 Sinking fund withdrawal .......................................... 32.7 — Increase (decrease) in short-term notes payable ........................ (43.3) 251.5 Redemptions of long-term debt .................................... (258.4) (323.9) Other ....................................................... 1.4 1.5 (224.3) (57.3) Decrease in cash ............................................... (158.2) (7.2) Cash and temporary investments, beginning of year ...................... 125.9 133.1 Cash and temporary investments (bank indebtedness), end of year ........... $ (32.3) $ 125.9 I-27
TELUS CORPORATION (FORMERLY BCT.TELUS COMMUNICATIONS INC.) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 1999 21. DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (Continued) (a) Merger of BC TELECOM and TELUS The business combination between BC TELECOM and TELUS described in note 1(a) was accounted for using the pooling of interests method under Canadian GAAP. Under Canadian GAAP, the application of the pooling of interests method of accounting for the merger of BC TELECOM and TELUS resulted in the restatement of prior periods as if the two companies have always been combined. Under U.S. GAAP, the merger is accounted for using the purchase method. Use of the purchase method results in TELUS being acquired by BC TELECOM for $4,662.4 million (including merger related costs of $51.9 million) effective January 31, 1999. The acquisition was effected by issuing 112.3 million shares in TELUS Corporation (formerly BCT.TELUS Communications Inc.) and 1.5 million options to replace TELUS options outstanding. The acquisition is summarized as follows: Net assets acquired: Net working capital (including bank indebtedness acquired of $57.5 million) ........... $ (644.6) Property and equipment ................................................. 2,531.4 Intangible assets ...................................................... 4,033.3 Goodwill ............................................................ 403.1 Deferred income tax asset ............................................... 587.8 Other assets ......................................................... 284.8 Long-term debt ....................................................... (667.7) Deferred income tax liability ............................................. (1,855.3) Other liabilities ....................................................... (10.4) $ 4,662.4 Financed by: Issuance of shares and replacement options ................................... $4,609.2 Repurchase of partial shares .............................................. 1.3 Transaction costs ...................................................... 51.9 $ 4,662.4 The results of TELUS prior to the merger date of January 31, 1999 would not be included in the results of the Company under U.S. GAAP. Therefore, $15.3 million for the month ended January 31, 1999, and $249.3 million for the year ending December 31, 1998 has been deducted from the net income under Canadian GAAP. (b) Restructuring Charge A charge of $466.3 million was recorded for the expected costs to complete merger-related restructuring activities. Under U.S. GAAP, costs incurred to: • exit an activity of an acquired company, • involuntarily terminate employees of an acquired company, or • relocate employees of an acquired company I-28
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No securities commission or similar
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QUESTIONS AND ANSWERS ABOUT THE OFF
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outstanding voting shares of Clearn
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WHERE YOU CAN OBTAIN MORE INFORMATI
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SUMMARY The following is a summary
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Commitment to Accept the Offers by
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Selected Historical and Pro Forma C
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DEFINITIONS In the accompanying Sum
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‘‘Governmental Entity’’ mea
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‘‘Shareholders Agreements’’
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Shares and the amount of cash recei
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shares into the Depositary’s acco
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the person or persons specified by
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(l) neither TELUS nor the Banks bec
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condition of the Offers specified u
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(f) the Holdco Shareholder properly
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Notice of any determination regardi
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The Offers are not being made to, n
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On July 14, 2000, Darren Entwistle,
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espect of such Acquisition Proposal
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etter positioned to take advantage
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The funds obtained pursuant to the
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part of its national strategy, TELU
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to require holders of TELUS Non-Vot
Page 49 and 50: ‘‘Dividends’’ in TELUS’ A
Page 51 and 52: systems. Change in the regulation o
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Page 55 and 56: COMMITMENTS TO ACQUIRE SECURITIES O
Page 57 and 58: the proposed transaction is likely
Page 59 and 60: ACQUISITION OF CLEARNET SHARES NOT
Page 61 and 62: least equal in value to the conside
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Page 65 and 66: separately dispose of the balance o
Page 67 and 68: also be taxable Canadian property w
Page 69 and 70: No brokerage fees or commissions wi
Page 71 and 72: CONSENT OF AUDITORS To: British Col
Page 73 and 74: CERTIFICATE OF 612459 B.C. LTD. The
Page 75 and 76: MANAGEMENT’S REPORT Management is
Page 77 and 78: TELUS CORPORATION (FORMERLY BCT.TEL
Page 87 and 88: 4. FINANCING COSTS TELUS CORPORATIO
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Page 105 and 106: SCHEDULE II TELUS CORPORATION UNAUD
Page 107 and 108: COMPILATION REPORT To the Directors
Page 109 and 110: TELUS CORPORATION PRO FORMA CONSOLI
Page 111 and 112: TELUS CORPORATION NOTES TO THE PRO
Page 119 and 120: TELUS CORPORATION PRO FORMA CONSOLI
Page 127 and 128: SCHEDULE III TELUS CORPORATION U.S.
Page 129 and 130: The following table restates the ma
Page 131 and 132: ANNEX A ADDITIONAL INFORMATION ADDI
Page 133 and 134: Fares F. Salloum President — Inte
Page 135 and 136: Officers Name and Position held wit
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