Offer to purchase CLEARNET.pdf - About TELUS

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transcontinental high-density fibre optic transmission system used by the incumbent local exchange carriers. TELUS’ approximately 70% owned subsidiary, QuébecTel Group, owns and operates the second largest telecommunications system in Québec providing telecommunications services primarily in central and eastern Québec. It has offices in Rimouski and other major cities in Québec, including Montreal and Québec City. The TELUS network also interconnects with the network of GTE Corporation, a part of Verizon Communications and Verizon Wireless and Genuity (formerly a GTE Corporation subsidiary), and the networks of other carriers in the U.S. for the exchange of U.S. and international traffic. TELUS carries on its full range of business throughout British Columbia, Alberta and in the QuébecTel Territory. As part of its national growth strategy, TELUS is expanding into new geographic areas and emerging communications businesses. TELUS is putting in place its own national fibre network, supplemented by fibre rings in certain metropolitan areas. As part of its national strategy, TELUS plans to compete outside its incumbent territory as a CLEC. TIC has obtained final approval to operate as a CLEC in downtown Toronto. TELUS is pursuing CLEC status in other areas of Canada outside of Alberta, British Columbia and the QuébecTel Territory. TIC currently offers business wireline voice and data services, with points of presence in Regina, Saskatoon, Winnipeg, Burlington, Chatham, Hamilton, Kitchener, London, Mississauga, Oshawa, Ottawa, Toronto and Windsor. Further expansion in Ontario and Nova Scotia is planned for later this year. TIC also offers inter-networking and managed application services in Ontario and Québec. TIC plans to offer regional Internet Protocol services in Ontario by the end of 2000. TELUS Mobility is one of the major wireless and PCS providers in Canada offering both analogue and digital voice and data services and paging services. TELUS Mobility offers services in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. Effective May 11, 1999, TELUS Mobility negotiated the right to offer services outside of British Columbia and Alberta on a national basis via resale, as a result of a new agreement among Mobility Canada members. This new agreement does not restrict Mobility Canada members from competing in each other’s territories. TELUS Mobility customers are able to roam throughout Canada through its agreement with Mobility Canada members, and throughout North America through its own and Mobility Canada’s arrangements with other cellular providers. The TELUS Common Shares and the TELUS Non-Voting Shares are listed for trading on the TSE under the symbol ‘‘T’’ and ‘‘T.A’’, respectively. Clearnet Clearnet is a holding company with two principal wholly-owned subsidiaries, Clearnet Inc. and Clearnet PCS Inc. Clearnet Inc. owns and operates an Enhanced Specialized Mobile Radio digital wireless business communications service under the Mike TM trademark, an analogue dispatch Specialized Mobile Radio service and a multi-location mobile communications sales and service dealership division. Clearnet PCS Inc. owns and operates a PCS digital wireless communications service under the Clearnet PCS TM trademark and numerous retail store outlets. The Clearnet Non-Voting Shares trade in Canadian currency on the TSE under the stock symbol ‘‘NET.A’’ and in U.S. currency on NASDAQ under the stock symbol ‘‘CLNT’’. Support Agreement On August 20, 2000, Clearnet and TELUS entered into the Support Agreement which provides, among other things, that TELUS will make the Offers. In the Support Agreement, Clearnet confirmed that the board of directors of Clearnet has unanimously determined that the Offers are in the best interests of Clearnet, the consideration offered thereunder is fair to the holders of Clearnet Shares and has unanimously recommended that Shareholders accept the Offers and tender their Clearnet Shares hereto. See ‘‘Background to the Offers — Support Agreement’’ in the Circular. 2
Commitment to Accept the Offers by Certain Shareholders Subject to the conditions of the Shareholders Agreements, certain Shareholders of Clearnet have agreed irrevocably to deposit (and not withdraw) all of their Clearnet Non-Voting Shares (representing 8.96% of the class), all of their Class B Shares (representing 91.4% of the class), all of their Class C Shares (100%) and all of their Class D Shares (100%) in acceptance of the Offers. All of the committed Clearnet Shares taken together represent approximately 91.0% of the voting shares of Clearnet and 35.1% of the economic interest in Clearnet. See ‘‘Background to the Offers — Shareholder Agreements and Related Agreements’’ in the Circular. Purpose of the Offers We are making the Offers in order to enable the Offeror to acquire all of the outstanding Clearnet Shares. See ‘‘Background to the Offers — Purpose and Benefits of the Offers’’ in the Circular. Accounting Treatment We will account for the business combination of Clearnet and TELUS using the purchase method of accounting in Canada and the United States. See ‘‘TELUS Corporation Unaudited Pro Forma Consolidated Financial Statements’’ attached as Schedule II to the Offers to Purchase and Circular. Time for Acceptance Each Offer is open for acceptance until 12:01 a.m. (local time at the place of deposit) on Thursday, October 19, 2000 or such later time and date or times and dates to which it may be extended, unless withdrawn by the Offerors. See ‘‘Time for Acceptance’’ in Section 2 of the Offers to Purchase. Manner of Acceptance Shareholders wishing to accept an Offer must deposit before the Expiry Time certificates representing their Clearnet Shares together with a Letter of Transmittal, properly completed and signed, at any one of the offices of the Depositary or the U.S. Forwarding Agent specified in the Letter of Transmittal. Instructions are contained in the Letter of Transmittal. If a Shareholder wishes to deposit Clearnet Shares pursuant to an Offer and the certificates representing the Clearnet Shares are not immediately available, or if that Shareholder cannot deliver the certificates and all other required documents to the Depositary at its office on or prior to the Expiry Time, those Clearnet Shares may nevertheless be deposited in compliance with the procedure for guaranteed delivery. See ‘‘Manner of Acceptance — Procedure for Guaranteed Delivery’’ in Section 3 of the Offers to Purchase. Shareholders whose Clearnet Shares are registered in the name of an investment dealer, stockbroker, bank, trust company or other nominee should contact that nominee for assistance if they wish to accept an Offer. No fee or commission will be payable by Shareholders who deliver Clearnet Shares directly to the Depositary or U.S. Forwarding Agent or who utilize the facilities of the soliciting dealer group to accept an Offer. Withdrawal of Deposited Clearnet Shares Any Clearnet Shares deposited in acceptance of an Offer may be withdrawn by or on behalf of the depositing Shareholder at any time before 12:01 a.m. (local time at the place of deposit) on October 19, 2000, and at any time after November 6, 2000 provided that the Clearnet Shares have not been taken up and paid for by the Offerors prior to receipt by the Depositary of the notice of withdrawal in respect of such Clearnet Shares. Additional withdrawal rights may be available under other circumstances as required by applicable law. However, Clearnet Shares tendered during a subsequent offering period may not be withdrawn. See ‘‘Withdrawal of Clearnet Shares’’ in Section 8 of the Offers to Purchase. Except as so indicated or as otherwise required by applicable Law, tenders of Clearnet Shares are irrevocable. Payment for Clearnet Shares Upon the terms and subject to the conditions of the Offers, we will take up Clearnet Shares duly and validly tendered to the Offers in accordance with the terms thereof on or as soon after Expiry Time as we are permitted by Law to take up such securities and the conditions of the applicable Offers (as the same may be amended or 3
Page 1 and 2: No securities commission or similar
Page 3 and 4: QUESTIONS AND ANSWERS ABOUT THE OFF
Page 5 and 6: outstanding voting shares of Clearn
Page 7 and 8: WHERE YOU CAN OBTAIN MORE INFORMATI
Page 9: SUMMARY The following is a summary
Page 13 and 14: Selected Historical and Pro Forma C
Page 15 and 16: DEFINITIONS In the accompanying Sum
Page 17 and 18: ‘‘Governmental Entity’’ mea
Page 19 and 20: ‘‘Shareholders Agreements’’
Page 21 and 22: Shares and the amount of cash recei
Page 23 and 24: shares into the Depositary’s acco
Page 25 and 26: the person or persons specified by
Page 27 and 28: (l) neither TELUS nor the Banks bec
Page 29 and 30: condition of the Offers specified u
Page 31 and 32: (f) the Holdco Shareholder properly
Page 33 and 34: Notice of any determination regardi
Page 35 and 36: The Offers are not being made to, n
Page 37 and 38: On July 14, 2000, Darren Entwistle,
Page 39 and 40: espect of such Acquisition Proposal
Page 41 and 42: etter positioned to take advantage
Page 43 and 44: The funds obtained pursuant to the
Page 45 and 46: part of its national strategy, TELU
Page 47 and 48: 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
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Page 59 and 60: ACQUISITION OF CLEARNET SHARES NOT
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least equal in value to the conside
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Beneficial owners of Clearnet Conve
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separately dispose of the balance o
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also be taxable Canadian property w
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No brokerage fees or commissions wi
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CONSENT OF AUDITORS To: British Col
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CERTIFICATE OF 612459 B.C. LTD. The
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MANAGEMENT’S REPORT Management is
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TELUS CORPORATION (FORMERLY BCT.TEL
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4. FINANCING COSTS TELUS CORPORATIO
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SCHEDULE II TELUS CORPORATION UNAUD
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COMPILATION REPORT To the Directors
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TELUS CORPORATION PRO FORMA CONSOLI
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TELUS CORPORATION NOTES TO THE PRO
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TELUS CORPORATION PRO FORMA CONSOLI
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SCHEDULE III TELUS CORPORATION U.S.
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The following table restates the ma
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ANNEX A ADDITIONAL INFORMATION ADDI
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Fares F. Salloum President — Inte
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Officers Name and Position held wit
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