Offer to purchase CLEARNET.pdf - About TELUS

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CLEARNET Clearnet Communications Inc. is a holding company that was continued under the CBCA on October 20, 1994. Clearnet has two principal wholly-owned subsidiaries, Clearnet Inc., and Clearnet PCS Inc., both of which are CBCA corporations. The registered head office of each corporation is located at 200 Consilium Place, Scarborough, Ontario, M1H 3J3 and the telephone number is (416) 279-9000. Clearnet Inc. owns and operates an Enhanced Specialized Mobile Radio (‘‘ESMR’’) digital wireless business communications service under the Mike trademark (‘‘Mike’’), an analogue dispatch Specialized Mobile Radio (‘‘SMR’’) 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 trademark and numerous retail store outlets. Clearnet is one of Canada’s leading wireless telecommunications companies, offering a combination of wireless services addressing the varied needs of distinct market segments. As at June 30, 2000, Clearnet’s PCS network covered a population of 17.2 million (28 million with analogue cellular through roaming agreements made by Clearnet) and Clearnet’s ESMR Mike network covered a population of 20.8 million. As at June 30, 2000, Clearnet provided wireless services to 693,540 subscribers, consisting of: 398,300 PCS subscribers (49,090 of which were added in the first half of 2000); 274,175 ESMR subscribers (64,054 of which were added in the first half of 2000); and 21,065 SMR subscribers. Clearnet holds one of only two high-capacity 30 MHz PCS licenses in Canada and is the only company with two state-of-the-art and complementary digital wireless services in Canada. 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. Based upon information provided by Clearnet, TELUS believes that, as of September 18, 2000, there were approximately 48,695,323 Clearnet Non-Voting Shares, 321,321,912 Class B Shares, 6,092,591 Class C Shares and 7,790,741 Class D Shares, outstanding on a fully-diluted basis. MATERIAL CHANGES AND OTHER INFORMATION CONCERNING CLEARNET The Offerors have no information which indicates any material change in the affairs of Clearnet since the date of the last published financial statements of Clearnet other than as has been publicly disclosed by Clearnet. The Offerors have no knowledge of any material fact concerning securities of Clearnet that has not been generally disclosed by Clearnet or any other matter that has not previously been generally disclosed but which would reasonably be expected to affect the decision of Shareholders to accept or reject the Offers. TELUS AND ACQUISITION CO. TELUS TELUS was incorporated under the Company Act (British Columbia) on October 26, 1998, as BCT.TELUS Communications Inc. and on May 3, 2000 changed its name to TELUS Corporation. TELUS’ executive and registered offices are located at 21st Floor, 3777 Kingsway, Burnaby, British Columbia, V5H 3Z7. TELUS is the second largest Canadian telecommunications provider with a full range of communication services. Its subsidiaries provide telecommunications services and solutions including voice, data, cellular, Internet, information management and advertising. Voice and data communications, carried over both wireline and wireless networks, are the major lines of business. Interconnection with other communications carriers enables the customers of TELUS to communicate nationally and globally. TELUS’ serves approximately 99% of British Columbia’s population of approximately 4.0 million residents and approximately 100% of Alberta’s population of approximately 3.0 million residents. Its network includes the British Columbia and Alberta portion of a cross Canada route for wireline, data and image communications services including the British Columbia and Alberta portion of the coast-to-coast microwave networks and the transcontinental high-density fibre optic transmission system used by the incumbent local exchange carriers. TELUS is building its own national fibre network, supplemented by fibre rings in certain metropolitan areas. As 36
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 portal services in Ontario by the end of 2000. 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 the 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, Genuity (formerly a subsidiary of GTE Corporation) 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, through its TELUS Communications division, provides local and long distance wireline services. Local wireline services allow customers to complete calls in their local calling areas and to access long distance networks, cellular networks and the Internet. Virtually all homes and businesses in the TELUS serving territories have access to some or all of its local services. In addition to local calling, local services generally include: enhanced calling features, such as call display, call waiting, call forwarding and voice mail; Centrex for business customers; public pay telephones; and competitive long distance carrier access. Local access or exchange service is the largest component of local wireline service offered by the subsidiaries of TELUS. Local wireline service is generally provided on a monthly, flat rate basis. CLECs operating in Alberta and British Columbia provide service to their customers over facilities they have constructed, over facilities leased from subsidiaries of TELUS or by reselling the service of those subsidiaries. CLECs that use their own facilities or facilities leased from subsidiaries of TELUS are eligible for a subsidy when they provide service to residential customers living in areas where that TELUS subsidiary receives a subsidy. 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. The TELUS Mobility division 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. TELUS is the second largest Internet service provider in Canada. Business customers are increasing their use of data services such as business intranets, electronic commerce and computer applications. Residence customers are increasing their use of personal computer access, Internet access, and facsimile transmission. TELUS also offers a range of advanced intelligent network services — services that can be customized to meet the specific needs of individual customers through software changes to network switches. These services include special number services such as 1-800 and 1-900 services, enhanced call routing services and specialized Internet access services. 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. Acquisition Co. 612459 B.C. Ltd., Acquisition Co., is a wholly-owned indirect subsidiary of TELUS. Acquisition Co. was incorporated under the Company Act (British Columbia) on August 17, 2000 as a ‘‘shelf corporation’’ and 37
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 and 10: SUMMARY The following is a summary
Page 11 and 12: Commitment to Accept the Offers by
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: The funds obtained pursuant to the
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
Page 53 and 54: (b) the management proxy circular o
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
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
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TELUS CORPORATION (FORMERLY BCT.TEL
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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
Page 135 and 136:
Officers Name and Position held wit
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