Offer to purchase CLEARNET.pdf - About TELUS

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TELUS CORPORATION NOTES TO THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 1999 (unaudited) 2. ASSUMPTIONS AND ADJUSTMENTS (Continued) • Common equity increased by: (1) $2,304.4 million from the TELUS equity issue; and (2) $609.1 million for the elimination of Clearnet common share capital and retained deficit • Goodwill and other intangibles have been recorded for the purchase price in excess of net tangible assets. Income Statement • Financing costs have increased by: (1) $186.7 million as a result of interest expense on debt issued to affect the purchase, and (2) $13.9 million for amortization of the deferred financing charge. • The income tax adjustment reflects the recording of future income tax benefit on the current year loss, as well as a reduction in taxes associated with the increased financing costs. The effective tax rate assumed was 45.2%. • Amortization of goodwill of $241.6 million associated with the purchase has been recorded based upon an amortization period of 20 years. (c) Other • No other adjustments have been made to operating revenues and expenses for any changes expected to occur in future years as a result of this reorganization. • The purchase of QuebecTel by TELUS effective June 1, 2000 has not been reflected in these pro forma statements. II-8
TELUS CORPORATION NOTES TO THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 1999 (unaudited) 3. DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES The unaudited pro forma consolidated financial statements have been prepared in accordance with generally accepted accounting principles (‘‘GAAP’’) in Canada. The principles adopted in these financial statements conform in all material respects to those generally accepted in the United States except as summarized below. Significant differences between Canadian GAAP and U.S. GAAP would have the following effect on reported net income of the Company for the year ended December 31, 1999: Net loss in accordance with Canadian GAAP ................................ TELUS Adjustments, net of tax: (millions) (except per share amounts) $(321.8) Net loss of acquired company prior to acquisition (a) ......................... (15.3) TELUS portion of the restructuring charge (b) ............................. 144.6 Decrease in depreciation expense (c) .................................... 17.7 Decrease in interest expense (d) ........................................ 14.2 Amortization of intangible assets (e) ..................................... (59.2) Goodwill amortization (f) ............................................. (11.6) Change in accounting policy (g) ........................................ (30.8) Asset impairment difference (h) ........................................ Clearnet Adjustments, net of tax: 40.0 Premium on repurchase of long-term debt (j) .............................. 6.0 Foreign exchange (i) ................................................ 30.0 Net loss before Extra-ordinary Item ....................................... (186.2) Premium on repurchase of long-term debt (j) .............................. (6.0) Net loss in accordance with U.S. GAAP .................................... Loss per share under U.S. GAAP (basic and diluted): $(192.2) Before extra-ordinary items ........................................... $ (0.65) Extra-ordinary items ................................................ (0.02) After extra-ordinary items ............................................ $ (0.67) II-9
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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
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‘‘Dividends’’ in TELUS’ A
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systems. Change in the regulation o
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(b) the management proxy circular o
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COMMITMENTS TO ACQUIRE SECURITIES O
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the proposed transaction is likely
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ACQUISITION OF CLEARNET SHARES NOT
Page 61 and 62: least equal in value to the conside
Page 63 and 64: Beneficial owners of Clearnet Conve
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
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: TELUS CORPORATION NOTES TO THE PRO
Page 115 and 116: 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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