Mason Capital Files Dissident Proxy Circular for TELUS General Meeting

  Mason Capital Files Dissident Proxy Circular for TELUS General Meeting

     Urges TELUS Voting Shareholders to Reject TELUS Proposal to Exchange
          Non-Voting Shares for Voting Shares on a One-for-One Basis

            Explains Longstanding Market Premium of Voting Shares

 Outlines TELUS Corporate Governance Failures and Reliance on Flawed Analyses

                Mason to Hold Conference Call on September 27

Business Wire

NEW YORK -- September 24, 2012

Mason Capital Management LLC ("Mason") today announced that it has filed and
is sending its dissident proxy circular to voting shareholders of TELUS
Corporation (TSX:T; TSX:T.A; NYSE: TU) ("TELUS") for the general meeting of
TELUS scheduled for October 17, 2012.

Michael Martino, Principal and Co-Founder of Mason Capital, said, “TELUS’
actions stand to set a very dangerous precedent in corporate Canada. The
company is closing its eyes to the market premium of the voting shares and the
rights of the class of shareholders who paid the premium for those voting
rights. Mason urges all of TELUS voting shareholders to act now to protect
these valuable rights, which were paid for, and to reject TELUS’ flawed
proposal.”

Added Martino, “Our effort to protect all voting shareholders is recognized by
leading independent governance experts who have confirmed that this proposal,
which unfairly transfers value from the voting shareholders and provides it to
the non-voting shareholders, is the result of a flawed and conflicted process.
The lack of a proper process was only exacerbated by the fact that the
holdings of management and the Board are heavily weighted towards the
non-voting shares. TELUS has misinformed shareholders from the outset,
including about management’s and the Board’s interest in the non-voting
shares. Mason will continue its efforts to redress TELUS’ failures of
corporate governance to ensure that Voting shareholders receive the benefit of
a fair exchange ratio in a dual-class collapse transaction.”

In May 2012, TELUS withdrew its proposal to convert all of its non-voting
shares into Voting shares on a one-for-one basis because it faced certain
rejection by voting shareholders. TELUS' new share collapse proposal is the
very same proposal that was already rejected, except this time TELUS has
attempted to circumvent the requirement for a two-thirds approval of voting
shareholders. TELUS is moving the goalposts in a coercive attempt to make it
easier to force the transaction through.

The proxy circular filed today includes a letter to voting shareholders, which
outlines the reasons Mason believes voting shareholders should vote “No” to
TELUS’ proposed plan of arrangement to exchange non-voting shares into voting
shares at a one-to-one ratio, including:

  *Voting Shares are Historically and Fundamentally More Valuable Than
    Non-Voting Shares

       *Over the past 13 years, TELUS voting shares have traded at an average
         premium of 4.83% relative to the non-voting shares; the premium has
         been as high as 15.23%.
       *Investors acquiring TELUS shares have been able to freely choose
         whether to acquire TELUS shares without voting rights or to pay a
         premium to acquire TELUS shares with voting rights. The 4.83% average
         premium that investors have been willing to pay for voting rights is
         based on over $98 billion in trades in voting shares occurring over
         the 13 year period prior to the announcement of TELUS initial share
         collapse proposal.
       *TELUS management falsely claims that voting rights have no value
         whatsoever, when in reality, the differences between the shares
         classes are real and substantive, and the significant and
         long-standing market price differential has been established in
         well-informed, highly-liquid markets.
       *The right to vote is fundamental: it allows the Voting class to elect
         the directors and thereby determine the entire direction of the
         Company, including whether to pursue a change of control transaction.

  *TELUS One-for-One Share Collapse Proposal Would Dilute the Voting
    Shareholders Exclusive Voting Control from 100% to 54% for Zero
    Consideration, and Result in a Permanent Loss of the Market Premium That
    the Voting Shareholders Have Paid For

       *Blackstone Advisory Partners L.P. has provided a precedent analysis
         to Mason that implies a conversion ratio greater than 1:1. The
         Blackstone Precedent Analysis is available in its entirety with the
         letter to shareholders and proxy circular.

  *TELUS’ Board Demonstrated Clear Corporate Governance Failures

  *When the directors of a company decide to undertake a transaction to
    rearrange the voting rights of its shareholders, no matter how noble their
    intentions, their overriding duty is to ensure that it is implemented in a
    fair manner so as to respect the rights and interests of shareholders
    affected. The directors of TELUS failed to perform this function:

       *They did not establish a process whereby the interests of each class
         would be fully and independently considered, including failing to
         obtain an independent fairness opinion for the voting class.
       *They failed to address the apparent conflicts of interest arising
         from the fact that the personal holdings of the directors and senior
         officers are heavily tied to the non-voting shares. 89% of the
         personal holdings of the members of the special committee of TELUS
         shares, options, DSUs and RSUs were tied to the non-voting shares.
       *They approved a transaction that, on its face, sacrificed the
         interests of one class to bestow a windfall benefit on the other.
       *They consistently demonstrated a “fixed mindset”, refusing to
         consider any alternatives to TELUS management’s one-to-one proposal,
         despite it having been rejected by voting shareholders.

  *TELUS Board Relied on a Flawed Scotia Fairness Opinion

       *Regarding TELUS and the 22 precedent transactions referred to in
         Scotia Capital's fairness opinion, Scotia ignores historical trading
         prices of the two stock classes and the increases or decreases in
         share values that results from the exchange ratios in all 23
         transactions
       *Scotia disregarded the historical 4.83 percent premium of TELUS
         voting shares determined over 13 years and $98 billion of trades
       *Scotia's list of 22 precedents included 14 where only one class of
         stock traded, which only highlights Scotia's disregard for the
         relevance of trading prices in determining an appropriate exchange
         ratio
       *In the 8 precedents considered by Scotia where both classes traded, 5
         of them had an exchange ratio greater than one-to-one for the benefit
         of the share class with superior voting rights

Mason’s dissident proxy circular filed today will be available on TELUS’
company profile on SEDAR at http://www.sedar.com.

Mason will hold a conference call for analysts, investors and other interested
parties on Thursday, September 27, 2012 at 11:00 a.m. (EDT). The participant
dial-in numbers are: 647-427-7450 (local/Toronto) 888-231-8191 (toll
free/North America). The webcast, which will be available through October 17,
2012, can be accessed at:
http://event.on24.com/r.htm?e=521713&s=1&k=4BC81DAB15364C9BCFFF98B1907B16DC.

       Any questions and requests for assistance may be directed to the
                          Proxy Solicitation Agent:

                                  KINGSDALE
                          Shareholder Services Inc.

                              The Exchange Tower
                130 King Street West, Suite 2950, P.O. Box 361
                               Toronto, Ontario
                                   M5X 1E2
                         www.kingsdaleshareholder.com

                       North American Toll Free Phone:

                                1-888-518-1565

                  Email: contactus@kingsdaleshareholder.com

                           Facsimile: 416-867-2271

                     Toll Free Facsimile: 1-866-545-5580

     Outside North America, Banks and Brokers Call Collect: 416-867-2272

Contact:

Sard Verbinnen & Co
Jonathan Gasthalter/Dan Gagnier/Brooke Gordon
+1 (212) 687-8080
or
NATIONAL Public Relations
Peter Block / Sarah Coombs / Jennifer Lee
+1 (416) 586-0180
 
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