Telus 2015 Annual Report Download - page 28

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by resolution and subject to filing an amendment to the Notice of Articles and Articles of
TELUS. No series of Second Preferred shares may have attached thereto the right to
vote at any general meeting of TELUS or the right to be convertible into or exchangeable
for Common Shares. Except as required by law, the holders of the Second Preferred
shares as a class are not entitled to receive notice of, attend or vote at any meeting of
the shareholders of TELUS. The Second Preferred shares rank, subject to the prior
rights of the holders of the First Preferred shares, prior to the Common Shares with
respect to priority in payment of dividends and in the distribution of assets in the event of
liquidation, dissolution or winding up of TELUS.
Shareholder rights plan
We first adopted a shareholder rights plan in March 2000, which expired on March 20,
2010. The TELUS Board of Directors adopted a substantially similar shareholder rights
plan (Rights Plan) on March 12, 2010 (Effective Date), which was ratified by
shareholders of both share classes at the May 2010 annual and special meeting and re-
confirmed at the May 2013 annual and special meeting. Under the terms of the current
Rights Plan a shareholder reconfirmation process must occur at the Company’s annual
meeting of shareholders in 2016 in order for the plan to remain in effect. Accordingly,
management and the Board will be asking shareholders at the 2016 annual general
meeting to reconfirm and approve the continued existence of the Rights Plan.
Under the current Rights Plan, TELUS issued one right (Right) in respect of each
Common Share outstanding as at the Effective Date. The Rights Plan has a term of just
over nine years, subject to shareholder confirmation every three years. Each Right, other
than those held by an Acquiring Person (as defined in the Rights Plan) and certain of its
related parties, entitles the holder in certain circumstances following the acquisition by
an Acquiring Person of 20% or more of the Common Shares of TELUS (otherwise than
through the “Permitted Bid” requirements of the Rights Plan) to purchase from TELUS
$320 worth of Common Shares for $160 (i.e. at a 50% discount) respectively.
At the May 2013 annual and special meeting, shareholders approved amendments to
the Rights Plan to reflect the elimination of the Non-Voting Share class from TELUS’
authorized share structure. Additionally, minor amendments were approved to reflect
TELUS’ use of the Direct Registration System Advice program since February 2013.
References to share certificates now also include a reference to securities that have
been issued and registered in uncertificated form that are evidenced by an advice or
other statement and which are maintained electronically with our transfer agent, but for
which no certificate has been issued (commonly referred to as the book entry form).
Normal course issuer bid and shelf prospectus
On September 14, 2015, we successfully completed our 2015 normal course issuer bid
(NCIB), purchasing and cancelling approximately 12.1 million Common Shares and
returning $500 million to shareholders. The average purchase price was $41.25. The
purchased shares represent 2% of the Common Shares outstanding prior to
commencement of the NCIB program. Since the commencement of our normal course
issuer bid program in 2013 to December 31, 2015, we have purchased and cancelled a
total of approximately 62.6 million Common Shares for $2.25 billion reflecting an
average price of $35.91 per share. In addition, we received approval from the TSX for a
new NCIB program (2016 NCIB) to purchase and cancel up to 16 million Common
Shares with a value of up to $500 million over a 12-month period, commencing