Offer to purchase CLEARNET.pdf - About TELUS

separately dispose of the balance of such Shareholder’s Clearnet Non-Voting Shares to Acquisition Co. for cash
(which disposition will be subject to the tax consequences described below under ‘‘Sale to Acquisition Co.
Pursuant to the Offers’’). The Share Portion will be equivalent to the fraction obtained by dividing the fair market
value of the TELUS Non-Voting Shares received by the Shareholder (excluding cash received in lieu of
fractional share) by the aggregate of the fair market value of such TELUS Non-Voting Shares and the amount of
cash received by the Shareholder (including cash received in lieu of a fractional share).
Since the amount of cash and TELUS Non-Voting Shares to be paid or issued, as the case may be, under the
Offers are each subject to stated maximum amounts, a Shareholder may receive cash and TELUS Non-Voting
Shares in a different proportion than elected by the Shareholder or may receive a combination of cash and
TELUS Non-Voting Shares in circumstances where the Shareholder has elected to receive only cash or only
TELUS Non-Voting Shares.
Sale to Acquisition Co. Pursuant to the Offers
A Shareholder who disposes of Clearnet Non-Voting Shares to Acquisition Co. under the Offers in
exchange for TELUS Non-Voting Shares, cash, or a combination of TELUS Non-Voting Shares and cash, will
realize a capital gain (or capital loss) equal to the amount by which the proceeds of disposition, net of any
reasonable costs of disposition, exceed (or are less than) the adjusted cost base of the Clearnet Non-Voting
Shares to the Shareholder. For purposes of computing such capital gain or capital loss, a Shareholder will be
considered to have disposed of the Clearnet Non-Voting Shares for proceeds of disposition equal to the fair
market value of any TELUS Non-Voting Shares and the amount of any cash received on the exchange. The cost
of any TELUS Non-Voting Shares acquired by the Shareholder on the exchange will be equal to their fair market
value at that time, and such cost will be averaged with the adjusted cost base of all other TELUS Non-Voting
Shares held by the Shareholder immediately prior to the exchange for the purpose of determining thereafter the
adjusted cost base of each TELUS Non-Voting Share held by such Shareholder.
Pursuant to the Budget, it is proposed that the capital gains inclusion rate be reduced from three-quarters
to two-thirds for dispositions occurring after February 27, 2000. Accordingly, assuming that the Budget proposals
become law and subject to certain transitional rules, a Shareholder will generally be required to include
two-thirds rather than three-quarters of the amount of any resulting capital gain (a ‘‘taxable capital gain’’) in
income and will be required to deduct two-thirds rather than three-quarters of the amount of any resulting
capital loss (an ‘‘allowable capital loss’’) against taxable capital gains realized in the year of disposition.
Allowable capital losses not deducted in the taxation year in which they are realized may be carried back and
deducted in any of the three preceding taxation years or carried forward and deducted in any following taxation
year against taxable capital gains realized in such taxation years, to the extent and under the circumstances
specified in the Tax Act and the Budget. Capital gains realized by an individual and most trusts may be subject to
alternative minimum tax.
In the case of a Shareholder that is a corporation, trust or partnership, the amount of any capital loss
otherwise determined resulting from the disposition of Clearnet Non-Voting Shares may be reduced by the
amount of certain dividends previously received or deemed to have been received on such shares, to the extent
and under the circumstances prescribed in the Tax Act.
A ‘‘Canadian-controlled private corporation’’ (as defined in the Tax Act) may be liable to pay an additional
62 ⁄3% refundable tax on certain investment income, including taxable capital gains.
Sale to TELUS Pursuant to the Offers
An Eligible Shareholder who makes the election provided for in the Letter of Transmittal or Notice of
Guaranteed Delivery and disposes of Clearnet Non-Voting Shares to TELUS in exchange for TELUS
Non-Voting Shares will generally qualify for a tax-deferred ‘‘rollover’’ with respect to such exchange. Unless the
Shareholder chooses to treat the exchange of such Clearnet Non-Voting Shares for TELUS Non-Voting Shares
as a taxable transaction, the Shareholder will be deemed to have disposed of such Clearnet Non-Voting Shares
for proceeds of disposition equal to the adjusted cost base to the Shareholder of such Clearnet Non-Voting
Shares immediately before the exchange, and to have acquired the TELUS Non-Voting Shares received in
exchange therefor at a cost equal to such proceeds. The cost of such TELUS Non-Voting Shares will be averaged
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