DISK004:[98CLG6.98CLG3726]BA3726A.;28 - About TELUS

TABLE OF CONTENTS
Page Page
SUMMARY ............................... 1 Court Approvals ........................... 51
GLOSSARY OF TERMS ....................... 9 Shareholder Approvals ....................... 52
JOINT MANAGEMENT PROXY CIRCULAR .......... 13 Regulatory Approvals ........................ 52
SOLICITATION OF PROXIES ................... 14 Other Conditions Precedent .................... 53
APPOINTMENT AND REVOCATION OF PROXIES ..... 14 PROCEDURES FOR EXCHANGE OF
VOTING AND RECORD DATE .................. 16 SHARE CERTIFICATES ..................... 54
THE ARRANGEMENT ....................... 18 Exchange of BC TELECOM Common Shares .......... 54
General ................................ 18 Exchange of TELUS Common Shares .............. 54
Background to the Arrangement .................. 18 Fractional Shares .......................... 55
BENEFITS OF THE TRANSACTION ............... 20 EFFECTIVE DATE .......................... 55
Platform for Growth ......................... 20 ACCOUNTING TREATMENT ................... 55
Synergies ............................... 20 STOCK EXCHANGE LISTINGS .................. 56
Enhanced Capital Markets Profile and Financial Resources . . 20 EMPLOYEE MATTERS ....................... 56
Relationship with GTE ....................... 21 ELIGIBILITY FOR INVESTMENT ................ 56
DELIBERATIONS AND RECOMMENDATIONS ........ 21 RESALE OF BCT.TELUS SHARES ................ 57
BC TELECOM Independent Committee ............. 21 COSTS OF THE ARRANGEMENT ................ 57
Opinions of Financial Advisors to BC TELECOM ....... 23 INVESTMENT CONSIDERATIONS ................ 57
Recommendation of BC TELECOM Board of Directors .... 24 Industry Considerations ....................... 57
TELUS Transaction Review Committee .............. 25 BCT.TELUS Considerations .................... 59
Opinions of Financial Advisors to TELUS ............ 26
CERTAIN INCOME TAX CONSIDERATIONS .......... 62
Recommendation of TELUS Board of Directors ........
THE EFFECT OF THE ARRANGEMENT ON
SHAREHOLDINGS ........................
Share Exchange ...........................
Option Exchange ..........................
27
28
28
29
Canadian Federal Income Tax Considerations ..........
BC TELECOM Optionholders and TELUS Optionholders . .
United States Federal Income Tax Considerations ........
BC TELECOM SHAREHOLDERS RIGHTS OF DISSENT . .
62
66
66
69
Schematic Representations of the Arrangement Process .... 30
TELUS SHAREHOLDERS RIGHTS OF DISSENT ....... 71
BCT.TELUS COMMUNICATIONS INC. ............. 31 INFORMATION RELATING TO BC TELECOM ........ 72
Business Strategy .......................... 31 Documents Incorporated by Reference .............. 72
Fibre Acquisition .......................... 31 Recent Developments ........................ 73
Business Activities ..........................
Directors ...............................
Executive Officers ..........................
Dual Head Offices ..........................
32
33
35
35
Price Range and Trading Volumes of BC TELECOM
Common Shares ..........................
INFORMATION RELATING TO TELUS .............
Documents Incorporated by Reference ..............
74
74
74
Corporate Governance ....................... 35
Recent Developments ........................ 75
Principal Holders of Securities ...................
Auditors, Transfer Agent and Registrar ..............
Dividends ...............................
35
36
36
Price Range and Trading Volumes of TELUS
Common Shares ..........................
INTEREST OF MANAGEMENT AND OTHERS IN THE
ARRANGEMENT .........................
76
77
Pro Forma Combined Consolidated Capitalization
of BCT.TELUS ..........................
Stock Options ............................
Pro Forma Interest and Asset Coverage .............
Memorandum and Articles of BCT.TELUS ...........
36
38
38
38
LEGAL MATTERS ..........................
BC TELECOM CERTIFICATE ...................
TELUS CERTIFICATE ........................
APPENDIX A — SPECIAL RESOLUTIONS ...........
77
78
79
A-1
Stock Option Plans ......................... 41
APPENDIX B — ARRANGEMENT AGREEMENT ....... B-1
Dividend Reinvestment and Share Purchase Plans ....... 41 APPENDIX C — INTERIM ORDERS ............... C-1
Employee Share Purchase Plans ..................
DETAILS OF THE ARRANGEMENT AND RELATED
TRANSACTIONS ..........................
The Arrangement Agreement ...................
Compensation and Option Agreements ..............
Arrangement Steps .........................
Comparisons between the BCCA and each of the CBCA and
the ABCA .............................
41
42
42
43
43
44
APPENDIX D — PROCEDURE TO EXERCISE DISSENT
RIGHT UNDER THE CBCA ...................
APPENDIX E — PROCEDURE TO EXERCISE DISSENT
RIGHT UNDER THE ABCA ...................
APPENDIX F — FAIRNESS OPINIONS ..............
APPENDIX G — INFORMATION RELATING TO
BC TELECOM INC. ........................
APPENDIX H — INFORMATION RELATING TO TELUS
CORPORATION ..........................
D-1
E-1
F-1
G-1
H-1
Voting Agreement .......................... 46
APPENDIX I — BCT.TELUS COMMUNICATIONS INC.
Pre-Arrangement Transaction ................... 47 UNAUDITED PRO FORMA COMBINED
Relationship between GTE and BCT.TELUS After
CONSOLIDATED FINANCIAL STATEMENTS ........ I-1
the Arrangement ......................... 48 APPENDIX J — LONG-TERM RELATIONSHIP
AGREEMENT ............................ J-1
Stentor Alliance ........................... 51
KEY APPROVALS .......................... 51 APPENDIX K — NOTICES OF PETITION ............ K-1