Offer to purchase CLEARNET.pdf - About TELUS

ACQUISITION OF CLEARNET SHARES NOT DEPOSITED UNDER THE OFFERS
Compulsory Acquisition
The purpose of the Offers is for the Offerors to acquire all of the outstanding Clearnet Shares. If, within the
time limit in the Offers for their acceptance or within 120 days from the date of the Offers, whichever period is
shorter, the Offers have been accepted by holders of not less than 90% of the Clearnet Shares of any class other
than Clearnet Shares held on the date of the Offers by or on behalf of the Offerors or its affiliates and associates
(as each such term is defined in the CBCA), and the Offerors have taken up and paid for such Clearnet Shares,
the Offerors currently intend to acquire (a ‘‘Compulsory Acquisition’’), pursuant to the compulsory acquisition
provisions of Section 206 of the CBCA, the remainder of the Clearnet Shares on the same terms on which the
Offerors acquired Clearnet Shares pursuant to the Offer.
To exercise such statutory right, the Offerors must give notice (the ‘‘Offerors’ Notice’’) to each holder of
Clearnet Shares who did not accept the Offers (and to each person who subsequently acquires any such Clearnet
Shares) (in each case a ‘‘Dissenting Offeree’’) and to the Director under the CBCA of the proposed acquisition
within 60 days after the Expiry Time, and in any event within 180 days after the date of the Offers. Within
20 days after giving the Offerors’ Notice, the Offerors must pay or transfer to Clearnet the consideration the
Offerors would have had to pay or transfer to the Dissenting Offerees if they had elected to accept the Offers, to
be held in trust for the Dissenting Offerees. Within 20 days after receipt of the Offerors’ Notice, each Dissenting
Offeree must send the certificates representing the Clearnet Shares held by such Dissenting Offeree to Clearnet,
and must elect either (i) to transfer the Clearnet Shares to the Offerors on the terms of the Offers or (ii) to
demand payment of the fair value of the Clearnet Shares by so notifying the Offerors. If a Dissenting Offeree
has elected to demand payment of the fair value of that Dissenting Offeree’s Clearnet Shares, the Offerors may,
within 20 days after they have paid or transferred to Clearnet the consideration described above, apply to a court
having jurisdiction to hear an application to fix the fair value of the Dissenting Offeree’s Clearnet Shares. If the
Offerors fail to so apply to such a court, the Dissenting Offeree may then apply to a court within a period of a
further 20 days to have the court fix the fair value of the Dissenting Offeree’s Clearnet Shares. If the Dissenting
Offeree who elects to demand payment of fair value of such shareholder’s Clearnet Shares does not notify the
Offerors of such election and does not apply to the applicable court to fix the fair value of such holder’s Clearnet
Shares within such period, such Dissenting Offeree shall be deemed to have elected to transfer that Dissenting
Offeree’s Clearnet Shares to the Offerors on the terms of the Offer. Any judicial determination of the fair value
of the Clearnet Shares could be more or less than the amount paid pursuant to the Offers.
The foregoing is a summary only. The summary is not intended to be exhaustive and is qualified in its
entirety by the provisions of Section 206 of the CBCA. Shareholders should refer to Section 206 of the CBCA for
the full text of the relevant statutory provisions. Section 206 of the CBCA is complex and may require strict
adherence to notice and timing provisions, failing which a Dissenting Offeree’s rights may be lost or altered.
Shareholders who wish to be better informed about these provisions should consult their legal advisors.
In the recent decision of the Ontario Court (General Division) in Shoom v. Great-West Lifeco, Inc. (1998),
40 O.R. (3d) 672, aff’d (1998), 42 O.R. (3d) 732 (C.A.), the Court considered the rights of a shareholder who did
not tender his shares to a take-over bid under which shareholders were offered a choice of consideration
consisting of cash or securities, subject to proration in the event that shareholders in the aggregate elected more
than the maximum number of securities offered. The proration provisions used under the take-over bid resulted
in all of the securities available for issuance under the bid being issued to shareholders on the first take-up date
under the bid with no securities remaining available for issuance to dissenting shareholders under a statutory
compulsory acquisition procedure. The Court held that a dissenting shareholder was entitled to receive no less
favourable treatment than any other shareholder and, accordingly, that the dissenting shareholder was entitled
to choose among the options available to those shareholders who had tendered to the bid, notwithstanding that
the maximum number of securities issuable under the bid had already been issued by the offeror to shareholders
who tendered under the bid. The Offerors believe that the prorating provisions of the Offers (which differ from
those considered the Shoom case) would apply in a manner consistent with the principles adopted by the Court
in the Shoom case.
51