Telus (TU) Prices $500M Notes Offering

TELUS (NYSE: TU) announced today it has priced $500 million of senior unsecured notes with a 10-year maturity. The notes are offered through a syndicate of agents led by BMO Capital Markets, Scotiabank and TD Securities Inc. Closing of the offering is expected to occur on or about March 28, 2023.

The 4.95% Sustainability-Linked notes, Series CAJ, were priced at $99.828 per $100 principal amount for an effective yield of 4.972% per annum until maturity, subject to a possible interest rate step-up, and will mature on March 28, 2033.

The net proceeds of this offering will be used for the repayment of outstanding indebtedness, including the repayment of commercial paper (incurred for general working capital purposes) and the reduction of cash amounts outstanding under an arm’s length securitization trust to which an affiliate of TELUS sells interests in certain trade receivables (incurred for general working capital purposes), and for other general corporate purposes.

The notes are “Sustainability-Linked Bonds” issued pursuant to TELUS’ Sustainability-Linked Bond Framework announced on June 14, 2021, as it may be amended, restated and/or replaced from time to time (the “Framework”) and will be TELUS’ fourth bond offering under the Framework. As part of the Framework, TELUS has committed to reducing its absolute Scope 1 and 2 greenhouse gas (“GHG”) emissions by 46% from 2019 levels by 2030. Should TELUS fail to achieve this target (the “Sustainability Performance Target”) by December 31, 2030, the interest payable on the notes will increase by 0.75% per annum, as will be further detailed in the prospectus supplement that TELUS will be filing to its short form base shelf prospectus dated August 8, 2022 with securities regulatory authorities in each of the provinces of Canada. The interest payable on the notes may also increase in certain circumstances if TELUS fails to meet additional sustainability and/or environmental, social or governance (“ESG”) targets as provided for in a future “Sustainability-Linked Bond” (a “Future SLB”) issued by TELUS pursuant to the Framework. The interest rate on the notes, however, can in no event exceed the initial rate of 4.95% by more than 1.50% per annum in the aggregate, whether as a result of the failure to achieve the Sustainability Performance Target and/or any targets under one or more Future SLBs.

The note offering supports TELUS’ commitment to environmental sustainability by linking financing to the achievement of ambitious ESG targets. The target set out in the Framework was approved by the Science Based Targets initiative (“SBTi”), further demonstrating TELUS’ global sustainability leadership and support of the world’s fight against climate change. The Sustainability Performance Target is consistent with reductions required to limit warming to below 1.5°C, which at the time of publication of the Framework, was considered the most ambitious designation available through the SBTi process.

TELUS will report annually on its performance against the Sustainability Performance Target and will also obtain an annual independent and external verification of its performance against the Sustainability Performance Target in the form of a limited assurance report. TELUS’ performance as well as the limited assurance report will be included in its annual Sustainability and ESG Report, or other similar report(s) as the case may be, and will be available on TELUS’ website.

Sustainalytics, a leading independent ESG research, ratings and analytics firm, issued a Second Party Opinion in June 2021 confirming that the Framework aligns with the International Capital Market Association's Sustainability-Linked Bond Principles, 2020.

This media release does not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction. The securities being offered have not been approved or disapproved by any Canadian securities regulatory authority, nor has any authority passed upon the accuracy or adequacy of the short form base shelf prospectus or the prospectus supplement. The notes have not been registered under the U.S. Securities Act of 1933, as amended, and none of the notes are being offered in the United States or to or for the account or benefit of any U.S. person.

The notes are being offered pursuant to a prospectus supplement to the short form base shelf prospectus of TELUS dated August 8, 2022. The short form base shelf prospectus and prospectus supplement contain important detailed information about the notes. Copies of the short form base shelf prospectus and the prospectus supplement relating to the offering of the notes when filed with securities regulatory authorities in Canada may be obtained from the Chief Legal and Governance Officer of TELUS at 510 W. Georgia St., 23rd Floor, Vancouver, British Columbia V6B 0M3 (telephone 604-695-6420). Copies of these documents are, or will be, available electronically on the System for Electronic Document Analysis and Retrieval of the Canadian Securities Administrators (“SEDAR”), at www.sedar.com. Investors should read the short form base shelf prospectus and prospectus supplement before making an investment decision.

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