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Table of Contents
INDEX TO FINANCIAL STATEMENTS

Table of Contents

As filed with the Securities and Exchange Commission on January 25, 2021.

Registration No. 333-251993


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



Amendment No. 2 to

FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



TELUS International (Cda) Inc.
(Exact name of Registrant as specified in its charter)

Not Applicable
(Translation of Registrant's name into English)

Province of British Columbia
(State or other jurisdiction of
incorporation or organization)
  7374
(Primary Standard Industrial
Classification Code Number)
  98-1362229
(I.R.S. Employer
Identification Number)

Floor 7, 510 West Georgia Street
Vancouver, BC V6B 0M3
(604) 695-3455

(Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)



Corporation Service Company
19 West 44th Street
Suite 200
New York, NY 10036

Telephone: 1-800-927-9800
(Name, address, including zip code, and telephone number, including area code, of agent for service)



Copies to:

Michel E. Belec
Chief Legal Officer
TELUS International (Cda) Inc.
Floor 7, 510 West Georgia Street
Vancouver, BC V6B 0M3

Lona Nallengara
Jason Lehner
Shearman & Sterling LLP
599 Lexington Avenue
New York, NY 10022-6069
(212) 848-4000
  Desmond Lee
James Brown
Osler, Hoskin &
Harcourt LLP
100 King Street West, Suite 6200
Toronto, ON M5X 1B8, Canada
(416) 362-2111
  Andrew J. Foley
Paul, Weiss, Rifkind, Wharton &
Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
(212) 373-3000
  Robert Carelli
David Tardif
Stikeman Elliott LLP
1155 René-Lévesque Blvd. West
41st Floor
Montréal, QC H3B 3V2, Canada
(514) 397-3000



Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration Statement.

            If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

            If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

            Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

            Emerging Growth Company    ý

            If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act.    o


The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

CALCULATION OF REGISTRATION FEE

               
 
Title of each class of
securities to be registered

  Amount
to be
registered(1)

  Proposed
maximum
offering price
per share(2)

  Proposed
maximum
aggregate
offering price(1)(2)

  Amount of
Registration Fee(3)

 

Subordinate voting shares, no par value

  38,333,333   $25.00   $958,333,325   $104,554.17

 

(1)
Includes the aggregate amount of additional subordinate voting shares that the underwriters have the option to purchase.

(2)
Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) of the Securities Act of 1933, as amended.

(3)
The registrant previously paid $10,910 in connection with the initial filing of the registration statement.

            The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission acting pursuant to said section 8(a), may determine.

   


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The information in this prospectus is not complete and may be changed. Neither we nor the selling shareholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and neither we nor the selling shareholders are soliciting offers to buy these securities in any state where the offer or sale is not permitted.

PROSPECTUS (SUBJECT TO COMPLETION)—DATED JANUARY 25, 2021

33,333,333 Shares

LOGO

Subordinate Voting Shares



         TELUS International (Cda) Inc. is offering 21,929,824 of our subordinate voting shares. The selling shareholders named in this prospectus are offering 11,403,509 of our subordinate voting shares. We will not receive any proceeds from the subordinate voting shares sold by the selling shareholders, including upon the sale of subordinate voting shares if the underwriters exercise their over-allotment option from any of the selling shareholders in this offering.

         This is our initial public offering and no public market currently exists for our subordinate voting shares.

         It is currently estimated that the initial public offering price will be between $23.00 and $25.00 per subordinate voting share.

         Following this offering, our authorized share capital will include subordinate voting shares and multiple voting shares. The rights of the holders of subordinate voting shares and multiple voting shares are generally identical, except with respect to voting and conversion. The subordinate voting shares will have one vote per share and the multiple voting shares will have 10 votes per share. The subordinate voting shares are not convertible into any other class of shares, while the multiple voting shares are convertible into subordinate voting shares on a one-for-one basis at the option of the holder and automatically upon the occurrence of certain events. After giving effect to this offering, the subordinate voting shares will collectively represent 16.0% of our total issued and outstanding shares and 1.9% of the combined voting power attached to all of our issued and outstanding shares (17.9% and 2.1%, respectively, if the underwriters' over-allotment option is exercised in full) and the multiple voting shares will collectively represent 84.0% of our total issued and outstanding shares and 98.1% of the combined voting power attached to all of our issued and outstanding shares (82.1% and 97.9%, respectively, if the underwriters' over-allotment option is exercised in full).

         After giving effect to this offering, TELUS Corporation will have 66.6% of the combined voting power attached to all of our issued and outstanding shares (and 68.0% if the underwriters' over-allotment option is exercised in full). We will be a "controlled company" under the corporate governance rules for New York Stock Exchange ("NYSE")-listed companies, and therefore we will be permitted to, and we intend to, elect not to comply with certain NYSE corporate governance requirements. See "Management—Controlled Company Exemption".

         We have applied for listing of our subordinate voting shares on the NYSE and the Toronto Stock Exchange (the "TSX") under the symbol "TIXT". Neither the NYSE nor the TSX has conditionally approved our listing application and there is no assurance that such exchange will approve the listing applications.



         We are currently an "emerging growth company" under the U.S. federal securities laws, and as such, we have elected to comply with reduced reporting requirements for this prospectus, but we expect to no longer be an emerging growth company upon completion of this public offering.

         Investing in our subordinate voting shares involves risks. See "Risk Factors" beginning on page 25.



PRICE $            PER SUBORDINATE VOTING SHARE



       
 
 
  Per subordinate voting share
  Total
 

Initial public offering price

  $                       $                    
 

Underwriting discounts and commissions(1)

  $                       $                    
 

Proceeds, before expenses, to us

  $                       $                    
 

Proceeds, before expenses, to the selling shareholders

  $                       $                    

 

(1)
See "Underwriting" for a description of the compensation payable to the underwriters.

         One of the selling shareholders has granted the underwriters the right to purchase up to an additional 5,000,000 subordinate voting shares, solely to cover over-allotments.

         Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

         The underwriters expect to deliver the subordinate voting shares to purchasers on                , 2021.



J.P. Morgan   Morgan Stanley

(lead bookrunners listed in alphabetical order)

 

Barclays   BofA Securities   CIBC Capital Markets

 

Citigroup   Credit Suisse   RBC Capital Markets   Baird   BMO Capital Markets

 

Scotiabank   TD Securities   Wells Fargo Securities   William Blair

 

MUFG   National Bank of Canada Financial Markets

 

[LOGO]

Next-generationdigitally-led customerexperiences

At TELUS International, weempower the human experiencethrough digital enablement, agileand lean thinking, spiritedteamwork, and a caring culture thatputs customers and the value ofhuman connection first.Next-generationdigitally-led customerexperiencesAs a digital customer experience(CX) innovator we design, buildand deliver next-gen digitalsolutions for global and disruptivebrands enabling theirtransformation journeys for betterCX and business outcomes.

 

 

9M 2020 Pro Forma Revenue 600+ $1.4B Clients 9M 2020 YoY Pro Forma Revenue Growth 50 17% Delivery Centers 9M 2020 Pro Forma Net Income Margin 6% 20+ Countries 9M 2020 Pro Forma Adjust EBITDA Margin 22% ~50k Team Members Note: Pro forma nancial measures give effect to the acquisitions of CCC and Lionbridge. Please see “Unaudited Pro Forma Condensed Combined Consolidated Financial Information” in this prospectus for more information. 1. Refiects a comparison of pro forma revenue for the nine months ended September 30, 2020 and 2019. 2. Pro forma net income margin and pro forma adjusted EBITDA margin are calculated by dividing pro forma net income or pro forma adjusted EBITDA, as the case may be, by pro forma revenues arising from service contracts with customers—service. Pro forma adjusted EBITDA is a non-GAAP financial measure. For an explanation of this measure and a reconciliation to pro forma net income, the most comparable GAAP measure, see “Management Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures.” 3. As of September 20, 2020

 

Table of Contents


Table of Contents

 
  Page

PROSPECTUS SUMMARY

  1

SUMMARY HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA

  18

RISK FACTORS

  25

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

  74

INDUSTRY AND MARKET DATA

  76

USE OF PROCEEDS

  77

DIVIDEND POLICY

  78

CAPITALIZATION

  79

DILUTION

  82

CCC

  84

LIONBRIDGE AI

  87

UNAUDITED PRO FORMA CONDENSED COMBINED CONSOLIDATED FINANCIAL INFORMATION

  92

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

  108

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

  110

BUSINESS

  146

MANAGEMENT

  181

EXECUTIVE COMPENSATION

  194

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

  230

PRINCIPAL AND SELLING SHAREHOLDERS

  236

DESCRIPTION OF CERTAIN INDEBTEDNESS

  239

DESCRIPTION OF SHARE CAPITAL

  241

SHARES ELIGIBLE FOR FUTURE SALE

  253

CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS FOR U.S. PERSONS

  256

CERTAIN CANADIAN INCOME TAX CONSIDERATIONS

  260

UNDERWRITING (CONFLICTS OF INTEREST)

  262

EXPENSES OF THIS OFFERING

  279

LEGAL MATTERS

  280

EXPERTS

  280

ENFORCEMENT OF CIVIL LIABILITIES

  280

WHERE YOU CAN FIND MORE INFORMATION

  281

INDEX TO FINANCIAL STATEMENTS

  F-1

        We are responsible for the information contained in this prospectus and in any free writing prospectus we prepare or authorize. Neither we nor the selling shareholders nor the underwriters have authorized anyone to provide you with different information, and neither we nor the underwriters take responsibility for any other information others may give you. We, the selling shareholders and the underwriters are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. The information in this prospectus is only accurate as at the date of this prospectus. Our business, financial condition, results of performance and prospects may have changed since that date.

        We use various trademarks, trade names and service marks in our business, including TELUS. For convenience, we may not include the ® or ™ symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowed by law. Any other trademarks, trade names or service marks referred to in this prospectus are the property of their respective owners.

        Unless otherwise indicated or where the context requires otherwise, all references in this prospectus to the "Company", "TELUS International", "TI", "we", "us", "our" or similar terms refer

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to TELUS International (Cda) Inc. and its subsidiaries, including Triple C Holding GmbH (or any successor entity) ("Triple C Holding"). On December 16, 2020, Triple C Holding was merged into TELUS International Germany GmbH with TELUS International Germany GmbH as the surviving entity. All references in this prospectus to "TELUS" refer to TELUS Corporation and its subsidiaries other than TELUS International. All references in this prospectus to "Baring" refer to Baring Private Equity Asia. All references in this prospectus to "Competence Call Center" or "CCC" refer to the entirety of the assets and operations of Triple C Holding. All references to "Lionbridge AI" refer to the data annotation business of Lionbridge Technologies, Inc.

        Until                        , 2021 (25 days after the date of this prospectus), all dealers that buy, sell or trade our subordinate voting shares, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.


Presentation of Financial Information

        The financial statements of TELUS International and Triple C Holding included in this prospectus are presented in accordance with International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board, ("IASB"). The financial statements of Lionbridge AI included in this prospectus are presented in accordance with generally accepted accounting principles in the United States ("U.S. GAAP").

        The financial statements of the Company that are included in this prospectus consist of (i) consolidated statements of financial position as at December 31, 2019 and 2018, and the consolidated statements of income and other comprehensive income, changes in owners' equity, and cash flows, for each of the years in the three-year period ended December 31, 2019, and (ii) unaudited condensed interim consolidated statements of financial position as at September 30, 2020, and the unaudited condensed interim consolidated statements of income and other comprehensive income and cash flows for the three and nine months ended September 30, 2020 and 2019, and the unaudited condensed interim consolidated statement of changes in owners' equity for the nine months ended September 30, 2020 and 2019.

        The financial statements of Triple C Holding that are included in this prospectus consist of (i) consolidated statements of financial position as at December 31, 2019 and 2018 and January 1, 2018 and as at September 30, 2019, and (ii) the consolidated statements of income and other comprehensive income, changes in owner's equity, and cash flows, for each of the years in the two-year period ended December 31, 2019 and for the nine months ended September 30, 2019 and 2018. We acquired Triple C Holding on January 31, 2020. References in this prospectus to the financial statements of CCC mean the financial statements of Triple C Holding. See "CCC" for more information.

        The financial statements of Lionbridge AI that are included in this prospectus consist of (i) combined balance sheets as at December 31, 2019 and 2018 and combined statements of operations and comprehensive income, changes in parent company equity and cash flows for each of the years in the two-year period ended December 31, 2019 and (ii) unaudited condensed interim combined balance sheets as at September 30, 2020, and unaudited condensed interim combined statements of operations and comprehensive income, changes in parent company equity and cash flows for the nine months ended September 30, 2020 and 2019. We acquired Lionbridge AI from Lionbridge Technologies, Inc. on December 31, 2020. References in this prospectus to the financial statements of Lionbridge AI mean the financial statements of LBT Acquisition, Inc., the Lionbridge Technologies, Inc. entity that was formed to hold the Lionbridge AI business. See "Lionbridge AI" for more information.

        The pro forma financial statements included in this prospectus reflect the acquisition of the entirety of CCC, which occurred on January 31, 2020, and the acquisition of Lionbridge AI, which occurred on December 31, 2020, as if the acquisitions had occurred on January 1, 2019, the beginning of the fiscal periods presented. For more information, see "Unaudited Pro Forma Condensed Combined Consolidated Financial Information".

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        We and Lionbridge AI publish our consolidated financial statements in U.S. dollars and CCC's financial statements are published in euros. In this prospectus, unless otherwise specified, all monetary amounts are in U.S. dollars, all references to "US$", "$", "USD" and "dollars" mean U.S. dollars and all references to "C$", "CDN$" and "CAD$", mean Canadian dollars, and all references to "euro" and "€" mean the currency of the European Union.


Share Class Reclassification

        In connection with this offering, our outstanding Class A, Class C and Class D common shares held by TELUS will be exchanged for Class B common shares and we will redesignate our Class B common shares, which are only held by TELUS and Baring, as multiple voting shares. Each other holder of Class C common shares and Class D common shares will exchange their shares for Class E common shares and we will redesignate our Class E common shares as subordinate voting shares. Subsequent to such redesignations, we will effect a 4.5-for-1 split of each of our outstanding multiple voting shares and subordinate voting shares. A portion of the multiple voting shares held by TELUS and Baring will be converted to subordinate voting shares to be sold in this offering. Only subordinate voting shares will be issued by us in this offering. In addition, we expect to eliminate all of our previously outstanding series of Class A, Class C and Class D common shares and our authorized Class A and Class B preferred shares. We refer to these share split and share class redesignations and consolidation transactions as the "Share Class Reclassification Transactions". See "Description of Share Capital".

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PROSPECTUS SUMMARY

        This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before deciding to invest in our subordinate voting shares, you should read this entire prospectus carefully, including the sections of this prospectus entitled "Risk Factors", "Management's Discussion and Analysis of Financial Condition and Results of Operations", "Unaudited Pro Forma Condensed Combined Consolidated Financial Information" and our consolidated financial statements and the related notes, and the financial statements and related notes of CCC and Lionbridge AI, contained elsewhere in this prospectus.

Our Company

        We are a leading digital customer experience innovator that designs, builds and delivers next-generation solutions for global and disruptive brands. Our services support the full lifecycle of our clients' digital transformation journeys and enable them to more quickly embrace next-generation digital technologies to deliver better business outcomes. We work with our clients to shape their digital vision and strategies, design scalable processes and identify opportunities for innovation and growth. We bring to bear expertise in advanced technologies and processes, as well as a deep understanding of the challenges faced by all of our clients, including some of the largest global brands, when engaging with their customers. Over the last 15 years, we have built comprehensive, end-to-end capabilities with a mix of industry and digital technology expertise to support our clients in their customer experience and digital enablement transformations.

        TELUS International was born out of an intense focus on customer service excellence, continuous improvement and a values-driven culture, under the ownership of TELUS Corporation, a leading communications and information technology company in Canada. Since our founding, we have made a number of significant organic investments and acquisitions, with the goal of better serving our growing portfolio of global clients. We have expanded our agile delivery model to access highly qualified talent in multiple geographies, including Asia-Pacific, Central America, Europe and North America and developed a broader set of complex, digital-centric capabilities.

        We believe our ability to help clients realize better business outcomes begins with the talented team members we dedicate to supporting our clients because customer experience delivered by empathetic, highly skilled and engaged teams is key to providing a high-quality brand experience. We have a unique and differentiated culture that places people and a shared set of values at the forefront of everything we do. Over the past decade, we have made a series of investments in our people predicated upon the core philosophy that our "caring culture" drives sustainable team member engagement, retention and customer satisfaction.

        We have expanded our focus across multiple industry verticals, targeting clients who believe exceptional customer experience is critical to their success. Higher growth technology companies, in particular, have embraced our service offerings and quickly become our largest and most important industry vertical. Today, we are a leading digital customer experience ("CX") innovator that designs, builds and delivers next-generation solutions for global and disruptive brands. We believe we have a category-defining value proposition with a unique approach to combining both digital transformation and CX capabilities.

        We have built comprehensive, end-to-end capabilities with a mix of industry and digital technology expertise to support our clients in their customer experience and digital enablement journeys. Our services support the full scope of our clients' digital transformations and enable clients to more quickly embrace next-generation digital technologies to deliver better business outcomes. We provide strategy and innovation, next-generation technology and information technology ("IT") services, and CX process and delivery solutions to fuel our clients' growth. Our highly skilled and empathetic team members, together with our deep expertise in customer experience processes, next-generation technologies and

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expertise within our industry verticals, are core to our success. We combine these with our ability to discover, analyze and innovate with new digital technologies in our digital centers of excellence to continuously evolve and expand our solutions and services.

        We have built an agile delivery model with global scale to support next-generation, digitally-led customer experiences. Substantially all of our delivery locations are connected through a carrier-grade infrastructure backed by cloud technologies, enabling globally distributed and virtualized teams. The interconnectedness of our teams and ability to seamlessly shift interactions between physical and digital channels enables us to tailor our delivery strategy to clients' evolving needs. We have almost 50,000 team members located in 50 delivery locations across over 20 countries. Our delivery locations are strategically selected based on a number of factors, including access to diverse, skilled talent, proximity to clients and ability to deliver our services over multiple time zones and in multiple languages. We have established a presence in key global markets, which supply us with qualified, cutting-edge technology talent and we have been recognized as an employer of choice in many of these markets.

        Today, our clients include over 600 companies across high-growth verticals, including Tech and Games, Communications and Media, eCommerce and FinTech, Healthcare and Travel and Hospitality. Our relationship with TELUS, our largest client and controlling shareholder, has been instrumental to our success. TELUS provides significant revenue visibility, stability and growth, as well as strategic partnership with respect to co-innovation within our Communications and Media industry vertical. We have renewed our master services agreement with TELUS (the "TELUS MSA"). The renewed TELUS MSA provides for a new ten-year term commencing in January 2021, and for a minimum annual spend of $200.0 million, subject to adjustment in accordance with its terms. For more information, see "Certain Relationships and Related Party Transactions—Our Relationship with TELUS—Master Services Agreement".

        For the years ended December 31, 2019, 2018 and 2017, our revenues were $1,019.6 million, $834.6 million and $573.2 million, respectively, reflecting a compound annual growth rate of 34% over this period, and our pro forma revenue for the year ended December 31, 2019, was $1,571.4 million. For the nine months ended September 30, 2020 and 2019, our revenues were $1,139.3 million and $747.1 million, respectively and our pro forma revenue for the nine months ended September 30, 2020 and 2019, was $1,350.1 million and $1,154.0 million, respectively. Our net income was $69.0 million, $47.1 million and $43.4 million for the years ended December 31, 2019, 2018 and 2017, respectively, and our pro forma net loss for the year ended December 31, 2019, was $1.6 million. Our net income for the nine months ended September 30, 2020 and 2019, was $81.9 million and $41.7 million, respectively, and our pro forma net income (loss) for the nine months ended September 30, 2020 and 2019, was $78.1 million and $(21.7) million, respectively. Our adjusted net income ("TI Adjusted Net Income") was $82.4 million, $65.4 million and $56.7 million for the years ended December 31, 2019, 2018 and 2017, respectively and our adjusted EBITDA ("TI Adjusted EBITDA") was $225.6 million, $146.7 million and $113.8 million, respectively. For the nine months ended September 30, 2020 and 2019, TI Adjusted Net Income was $94.4 million and $56.6 million, respectively, and TI Adjusted EBITDA for these periods was $262.2 million and $161.9 million, respectively. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Measures" for a reconciliation of TI Adjusted Net Income and TI Adjusted EBITDA to net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, and see "Unaudited Pro Forma Condensed Combined Consolidated Financial Information" for more information regarding our pro forma financial measures.

Industry Background

        Technology, Innovation and Digital Enablement.    Technology is transforming the way businesses interact with their customers at an accelerating pace and scale. Across industries, customer experience has become a critically important competitive differentiator. Businesses face pressure to engage with

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their customers across digital and human channels, and seek to do so by combining technology with authentic human experience.

        Empowered and Engaged Customers.    The pervasiveness of next-generation technologies, which enables always-on connections, access to information 24/7 and greater variety of choice, has encouraged customer empowerment and raised their expectations. Customers are increasingly choosing experience over product and price. Customer experience has become a key competitive advantage, and it is critical for companies to manage this by partnering with customer service experts to represent their valued brands.

        Evolution of Customer Experience.    Contact centers have evolved from single-point, voice-based interaction hubs to omnichannel points of customer engagement. Companies increasingly view these omnichannel points of engagement as opportunities to build customer loyalty and increase wallet share. As the quality of these interactions matters even more today, companies need engaged, experienced, empathetic and technology-savvy employees representing their brands in their customer interactions.

        Importance of Building Trust and Security.    Companies and brands operating in the global digital marketplace need to engender trust in their online offerings in order to provide a feeling of safety that encourages customers to communicate and transact more. Accurate and rapid identification of content that violates the criteria of these offerings is of critical importance as user-generated content continues to grow, and expert human intervention is needed to handle content and customer concerns with the highest complexity. Additionally, fraud, identity theft and asset appropriation have become more pervasive. Companies are looking for solutions to assist in responding to these challenges.

        Challenges for Companies.    To meet modern customer expectations, companies must provide an experience that is not only personalized and empathetic, but consistent and integrated across omnichannel touchpoints, whether human or digital. To enable this, companies need partners with expertise in advanced analytics, artificial intelligence ("AI") and machine learning techniques to analyze data. In order to deliver this experience, companies need to re-design and re-engineer their processes, which is best executed by customer experience strategy and design consulting, IT services and process experts.

        Limitations of Incumbent Services Providers.    Delivering best-in-class omnichannel customer experiences requires highly trained professionals working in concert with leading digital technologies. We believe that traditional consulting, digital IT services and customer care and business process outsourcing companies lack the right combination of people, capabilities and technology to help companies address the entire spectrum of designing, building and delivering integrated end-to-end customer experience systems.

Our Market Opportunity

        Our solutions and services are relevant across multiple markets including IT services for digital transformation of customer experience systems ("DX") and digital customer experience management ("DCXM"). The worldwide market for DX was estimated by International Data Corporation ("IDC") to have been $147 billion in 2019. The worldwide market for DCXM was estimated by Everest Global, Inc. ("Everest Group") to have been $6 billion in 2018. Digital transformation services are estimated by IDC to grow at a compound annual growth rate of 21% from 2019 through 2023. The DCXM market is estimated by Everest Group to grow at a compound annual growth rate of 20%-25% from 2018 through 2021. In addition to DCXM, the Everest Group estimates the content moderation market to have been a $1.5 billion to $2.0 billion market in 2018 and expects it to experience estimated growth of 40%-50% from 2018 through 2021.

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Our Approach

        We are a leading digital customer experience innovator with a unique team culture and deep expertise in next-generation technologies and processes. We believe that our comprehensive capabilities and go-to-market strategy enable us to address our clients' varied needs in a flexible way that aligns with their objectives. Our focus on customer experience informs our approach to designing, building and delivering customer engagement and digital enablement solutions for our clients. We believe that customer experience delivered by empathetic, highly skilled and engaged teams is key to providing a high-quality brand experience to customers.

Our Competitive Strengths

        We have distinguished ourselves by leveraging the following competitive strengths:

        Cultural Differentiation.    We have a unique and differentiated culture that places people and a shared set of values at the forefront of everything we do. We have carefully cultivated our caring culture over the last 15 years by ensuring alignment with our team members and clients alike. We believe continuously investing in our culture and operating as a socially responsible company builds stronger relationships with our clients and team members, and positively impacts the communities in which we operate.

        Diverse Client Base Across Sectors.    We partner with a diverse set of disruptive and established clients across our core industry verticals, including Tech and Games, Communications and Media, eCommerce and FinTech, Healthcare and Travel and Hospitality. Within some of these industry verticals, we serve clients across several high-growth sub-sectors.

        Deep Domain Expertise.    We have developed expertise serving clients in our core verticals and sub-sectors, many of which are leading broader technology disruption. By serving clients in these sectors over the course of many years, we have built an understanding of their unique, industry-specific challenges and digital transformation journeys, as well as the solutions and services to address them. For example, within the Communications and Media industry vertical, our client engagements support digital transformation and innovation across our clients' digital stack, operations support system and business support system, modernization and testing and engineering of 5G networks for services such as internet of things ("IoT"). In the Tech and Games industry vertical, we believe we have been at the forefront of helping social networks manage the rapidly expanding volume of user-generated content on their platforms. We use AI/ML-assisted solutions to help clients monitor content for compliance with local policies and regulations. Additionally, we have partnered with several leading Games clients to support the high player growth they have seen over the past several years by deploying player support solutions that are based on our deep understanding of "gamer culture".

        Comprehensive, Integrated Capabilities to Enable Digital-First Experiences.    We have proactively built a set of integrated capabilities to deliver innovative customer experience solutions for our clients' customers. Our services span design, build and deliver so that we are able to offer clients a complete, transformative, digitally enabled solution, or a discrete solution to address or complement specific aspects of their existing customer experience strategies. We believe that our end-to-end solutions address client needs at all stages of their digital journeys and position us best to address their evolving priorities while expanding wallet share with them over time.

        Best-In-Class Technology and Processes.    We rely on best-in-class technology to power everything we do. By virtue of our TELUS pedigree, we have built our business with a deep understanding of the importance of technological reliability and availability, fueling our "always-on" carrier-grade network infrastructure. This infrastructure is augmented by our next-generation private and public cloud-based architecture, which enables our complete suite of integrated digital services and enables us to be agile, efficient and scalable.

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        Globally Scaled and Agile Delivery Model.    Over several years we have built a differentiated global delivery model enabled by next-generation technology with the scale and agility needed to best serve our clients. The sophistication, agility and scale of our delivery capabilities enable us to tailor our delivery strategy and respond quickly to shifting client demand as well as idiosyncratic events by pivoting client solutions across multiple regions, time zones and channels. For example, during the COVID-19 pandemic, we were able to continuously serve our clients' needs despite the mandatory closure of many facilities.

        Proven Leadership Team.    We have a proven leadership team with a successful track record of executing our strategic vision, driving growth across our business, integrating acquisitions both operationally and culturally and maintaining our unique culture. Our leaders not only possess significant and diverse skills and experience, but are committed to leading by example and living our values.

Our Growth Strategy

        We are dedicated to building on our current capabilities in digital transformation and customer experience management by deploying the following growth strategies:

        Expand Our Current and Potential Services with Existing Clients.    We seek to deepen existing client relationships by providing our clients with more of our existing services, as well as developing new adjacent services to address their evolving digital enablement and customer experience needs.

        Establish Relationships with New Clients.    We target potential clients that value customer experience as a brand differentiator. We prioritize potential clients that are experiencing significant growth and require a partner capable of evolving with them.

        Leverage Technology and Process to Drive Continuous Improvement.    We strive to continuously optimize the overall efficiency of our organization, enhance operating leverage and margins and better serve our clients by investing in best-in-class technologies.

        Enhance Core Capabilities with Strategic Acquisitions.    We seek out acquisition opportunities that expand the breadth of our service offerings, enhance the depth of our digital IT capabilities and accelerate our presence in attractive industry verticals, while maintaining alignment with our culture.

Recent Developments

Acquisition of Lionbridge AI

        On December 31, 2020, we completed the acquisition of Lionbridge AI, the data annotation business of Lionbridge Technologies, Inc., pursuant to the terms of a stock purchase agreement, dated November 6, 2020 for cash consideration of $939.0 million, subject to post-closing adjustments.

        Lionbridge AI is a market-leading global provider of crowd-based training data through various service offerings and the use of a proprietary annotation solution used in the development of artificial intelligence algorithms to power machine learning. Data annotation is the process of labeling data needed to train AI systems. Lionbridge AI annotates data in text, images, videos, and audio in more than 300 languages and dialects for some of North America's largest technology companies in social media, search, retail and mobile. Lionbridge AI has developed a proprietary data annotation solution of tools and processes that is used in combination with a flexible, crowdsourced community of over one million annotators, linguists and specialists across different languages, demographics and other characteristics across six continents. Lionbridge AI's solutions help improve data functionality and deliver secure, compliant, scalable and high-quality solutions for its clients. Lionbridge AI is headquartered in Waltham, Massachusetts.

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        In connection with the acquisition, we, along with Lionbridge AI, submitted a declaration filing with the Committee on Foreign Investment in the United States ("CFIUS"). At the end of its 30-day assessment of the declaration filing, CFIUS requested that we file a joint voluntary notice pursuant to Section 721 of the Defense Production Act, which triggered an additional 45-day review period. CFIUS advised us that the additional review is not directed specifically at our acquisition of Lionbridge AI, but is focused on certain commercial relationships TELUS has with certain foreign network infrastructure vendors. We have submitted the requested joint notice filing and provided additional information requested by CFIUS staff. Based on our discussions with CFIUS staff, we determined we could close the acquisition of Lionbridge AI before the expiry of the 45-day period. The statutory review period for the joint voluntary notice expires in March 2021. While we expect that CFIUS will complete its review of the joint voluntary notice and clear our acquisition of Lionbridge AI without condition, CFIUS may request that we and TELUS make assurances regarding our use in the United States of certain network infrastructure equipment sold by foreign entities. TELUS International does not believe assurances of this nature, if requested, or other conditions that could be imposed by CFIUS, if imposed, will have a material impact on its business. See "Risk Factors—Risks Related to Our Acquisition of Lionbridge AI and its Business—Our acquisition of Lionbridge AI remains subject to review by CFIUS and we are not certain how the outcome of the review will impact our business".

        We financed the acquisition with approximately $149.6 million in cash received from the issuance of 1,678,242 Class A common shares to TELUS, $80.4 million in cash received from the issuance of 901,101 Class B common shares to Baring and borrowings of $709.0 million under our credit agreement, of which $265.0 million was drawn on the term loan facilities, and the remainder on the revolving facilities.

        For more information on Lionbridge AI, please see "Lionbridge AI".

Preliminary Estimated Results for the Three Months and Year Ended December 31, 2020 (unaudited)

        Set forth below are certain preliminary and unaudited estimates of selected financial and other information for the three months and year ended December 31, 2020. The following information reflects our preliminary estimates with respect to such results based on currently available information, is not a comprehensive statement of our financial results and is subject to completion of our financial closing procedures which will not occur until after this offering is complete. Our financial closing procedures are not yet complete and, as a result, our actual results may change as a result of such financial closing procedures, final adjustments, management's review of results, and other developments that may arise between now and the time the financial results are finalized, and results could be outside of the ranges set forth below. These estimates should not be viewed as a substitute for our consolidated financial statements prepared in accordance with IFRS which will be filed with the SEC in our Annual Report on Form 20-F once available. Further, our preliminary estimated results are not necessarily indicative of the results to be expected for any future period as a result of various factors, including, but not limited to, those discussed in the sections titled "Risk Factors" and "Special Note Regarding Forward-Looking Statements". This information should be read in conjunction with our consolidated financial statements and the related notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" for prior periods included elsewhere in this prospectus. TI Adjusted EBITDA is a non-GAAP financial measure. For an explanation of this measure, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures".

        The preliminary estimated results for the three months and year ended December 31, 2020 do not reflect the acquisition of Lionbridge AI, which closed on December 31, 2020. For more information, see "Lionbridge AI".

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        The preliminary estimated results presented below have been prepared by, and are the responsibility of, management. Neither our independent registered public accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the preliminary estimated results presented below, nor have they expressed any opinion or any other form of assurance on such information or its achievability, and assume no responsibility for, and disclaim any association with, such preliminary estimated results.

        The following are the selected preliminary estimated financial results for the three months and year ended December 31, 2020, as well as a comparison to our financial results for the three months and year ended December 31, 2019:

 
  Three Months Ended December 31   Full Year Ended December 31  
(in millions)
  2020
Estimated Range
  2019
Actual
  2020
Estimated Range
  2019
Actual
 

Revenues arising from contracts with customers

  $ 430   $ 445   $ 272.5   $ 1,569   $ 1,584   $ 1,019.6  

Net Income

  $ 13   $ 20   $ 27.3   $ 95   $ 102   $ 69.0  

TI Adjusted EBITDA1

  $ 122   $ 130   $ 63.7   $ 384   $ 392   $ 225.6  

(1)
TI Adjusted EBITDA is a non-GAAP financial measure. The most comparable GAAP measure is net income and a reconciliation to net income is presented below. See Note 2 to "—Summary Historical Consolidated Financial and Other Data" for more information on TI Adjusted EBITDA.


 
  Three Months Ended December 31   Full Year Ended December 31  
(in millions)
  2020
Estimated Range
  2019
Actual
  2020
Estimated Range
  2019
Actual
 

Net Income

  $ 20   $ 13   $ 27.3   $ 102   $ 95   $ 69.0  

Add back (deduct):

                                     

Changes in business combination related provisions

            (12.1 )   (73 )   (73 )   (14.6 )

Interest expense

    10     12     8.3     44     46     36.3  

Foreign exchange

    (3 )   (6 )   (0.3 )   (1 )   (4 )   (2.6 )

Income taxes

    11     18     7.7     46     53     26.0  

Depreciation and amortization

    49     50     24.7     181     182     92.2  

Share-based compensation expense

    11     17     6.0     28     34     13.2  

Restructuring and other costs

    24     26     2.1     57     59     6.1  

TI Adjusted EBITDA

  $ 122   $ 130   $ 63.7   $ 384   $ 392   $ 225.6  

        Our revenue for the three months ended December 31, 2020 is estimated to be between $430 million and $445 million, compared to $272.5 million for the three months ended December 31, 2019. Our revenue for the full year ended December 31, 2020 is estimated to be between $1,569 million and $1,584 million, compared to $1,019.6 million for the full year ended December 31, 2019. The increase in revenue was from the contribution of our acquisitions that closed in 2020, as well as organic growth resulting from an increase in digital services and other service offerings provided to existing clients and, to a lesser extent, from new clients.

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        Our net income for the three months ended December 31, 2020 is estimated to be between $13 million and $20 million, as compared to $27.3 million for the three months ended December 31, 2019. The decrease in net income resulted from transaction costs incurred in connection with the acquisition of Lionbridge AI as well as higher depreciation and amortization expenses recognized in connection with the purchased intangibles from the acquisition of CCC, partly offset by higher revenue for the quarter. Our net income for the full year ended December 31, 2020 is estimated to be between $95 million and $102 million, as compared to $69.0 million for the year ended December 31, 2019. The increase in net income reflects organic growth as well as contribution from our acquisitions in 2020.

        Our TI Adjusted EBITDA for the three months ended December 31, 2020 is estimated to be between $122 million and $130 million, compared to $63.7 million for the three months ended December 31, 2019. Our consolidated TI Adjusted EBITDA for the full year ended December 31, 2020 is estimated to be between $384 million and $392 million, compared to $225.6 million for the full year ended December 31, 2019. The increase in TI Adjusted EBITDA was from accretive impacts of acquisitions as well organic growth from digital and other services with existing and new clients.

Risk Factors Summary

        Investing in our subordinate voting shares involves a high degree of risk. You should carefully consider the risks described in "Risk Factors" before making a decision to invest in our subordinate voting shares. If any of these risks actually occur, our business, financial condition and financial performance would likely be materially adversely affected. In such case, the trading price of our subordinate voting shares would likely decline and you may lose part or all of your investment. Below is a summary of some of the principal risks we face:

    We face intense competition from companies that offer services similar to ours.

    Our ability to grow and maintain our profitability could be materially affected if changes in technology and client expectations outpace our service offerings and the development of our internal tools and processes.

    If we cannot maintain our culture as we grow, our services, financial performance and business may be harmed.

    Our business and financial results could be adversely affected by economic and geopolitical conditions and the effects of these conditions on our clients' businesses and demand for our services.

    Two clients account for a significant portion of our revenue and loss of or reduction in business from, or consolidation of, these or any other major clients could have a material adverse effect.

    Our growth prospects are dependent upon attracting and retaining enough qualified team members to support our operations, as competition for highly skilled personnel is intense.

    Our business and financial results have been, and in the future may be, adversely impacted by the COVID-19 pandemic.

    Our recently completed acquisition of Lionbridge AI remains subject to CFIUS review.

    Our business would be adversely affected if individuals providing data annotation services through the crowdsourcing solutions we provide with our recently completed acquisition of Lionbridge AI were classified as employees and not as independent contractors.

    We may be unable to successfully identify, complete, integrate and realize the benefits of acquisitions or manage the associated risks.

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    Cyber-attacks or unauthorized disclosure resulting in access to sensitive or confidential information and data of our clients or their end customers could have a negative impact on our reputation and client confidence.

    Our business may not develop in ways that we currently anticipate due to negative public reaction to offshore outsourcing, proposed legislation or otherwise.

    Our ability to meet the expectations of clients of our content moderation services may be adversely impacted due to factors beyond our control and our content moderation team members may suffer adverse emotional or cognitive effects in the course of performing their work.

    The dual-class structure that will be contained in our articles has the effect of concentrating voting control and the ability to influence corporate matters with TELUS.

    TELUS will, for the foreseeable future, control the direction of our business.

    We have no history of operating as a separate, publicly-traded company.

Implications of Being an Emerging Growth Company and a Foreign Private Issuer

        As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an "emerging growth company", as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:

    an exemption that allows us to include less than five years of selected financial data in connection with this offering; and

    an exemption from the auditor attestation requirement on the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act").

        We may choose to take advantage of some, but not all, of these reduced requirements, and therefore the information that we provide holders of subordinate voting shares may be different than the information you might receive from other public companies in which you hold equity. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards applicable to public companies. We currently prepare our consolidated financial statements in accordance with IFRS as issued by the IASB, so we are unable to make use of the extended transition period. We will comply with new or revised accounting standards on or before the relevant dates on which adoption of such standards is required by the IASB.

        We may take advantage of these provisions until we are no longer an emerging growth company. We will cease to be an emerging growth company upon the earliest of the following:

    the last day of the first fiscal year in which our annual revenues were at least $1.07 billion;

    the last day of the fiscal year following the fifth anniversary of this offering;

    the date on which we have issued more than $1 billion of non-convertible debt securities over a three-year period; and

    the last day of the fiscal year during which we meet the following conditions: (i) the worldwide market value of our common equity securities held by non-affiliates as of our most recently completed second fiscal quarter is at least $700 million, (ii) we have been subject to U.S. public company reporting requirements for at least 12 months and (iii) we have filed at least one annual report as a U.S. public company.

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        We expect to cease to be an emerging growth company, and we expect to no longer be eligible to take advantage of these reduced requirements, upon completion of this initial public offering.

        Upon the effectiveness of the registration statement of which this prospectus forms a part, we will report under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as a non-U.S. company with foreign private issuer status. As long as we continue to qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including:

    the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act;

    the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and

    the rules under the Exchange Act requiring the filing with the Securities and Exchange Commission (the "SEC") of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events.

        In addition, we will not be required to file annual reports and financial statements with the SEC as promptly, or using the same forms, as U.S. domestic companies whose securities are registered under the Exchange Act, and are not required to comply with certain other rules and regulations under U.S. securities laws applicable to U.S. domestic companies whose securities are registered under the Exchange Act, including Regulation FD, which restricts the selective disclosure of material information.

        Foreign private issuers are also exempt from certain more stringent executive compensation disclosure rules under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act"). So long as we remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are not foreign private issuers.

Principal Shareholders

        Immediately following the completion of this offering, TELUS will own 66.6% and Baring Private Equity Asia, a leading global private equity investor, will own 31.5% of the combined voting power of our multiple voting shares and subordinate voting shares (68.0% and 29.9%, respectively, if the underwriters exercise their over-allotment in full). See "Risk Factors—Risks Related to Becoming a Public Company and Our Relationship with TELUS".

        In connection with this offering, we, TELUS and Baring have entered or will enter into certain agreements. See "Certain Relationships and Related Party Transactions—Our Relationship with TELUS" and "Certain Relationships and Related Party Transactions—Our Relationship with TELUS and Baring". In particular, in connection with this offering, we intend to enter into a shareholders' agreement with TELUS and Baring that will provide that:

    our board of directors will consist of eight directors at the time of this offering and will increase to 11 directors by the first anniversary of the offering;

    we will agree to nominate individuals designated by TELUS as directors representing half of our eight-director board at the time of consummation of this offering, and a majority of the board upon appointment of a ninth director to our board and thereafter, for so long as TELUS continues to beneficially own at least 50% of the combined voting power of our outstanding multiple voting shares and subordinate voting shares. Should TELUS cease to own at least 50% of the combined voting power of our multiple voting shares and subordinate voting shares, we will agree to nominate such number of individuals designated by TELUS in proportion to its

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      combined voting power for so long as TELUS continues to beneficially own at least 5% of the combined voting power of our outstanding multiple voting shares and subordinate voting shares, subject to a minimum of at least one director, and

    we will agree to nominate two individuals designated by Baring as directors at the time of consummation of this offering, which will be reduced to one individual designated by Baring upon appointment of a ninth director to our board and thereafter, for so long as Baring continues to beneficially own at least 5% of the combined voting power of our multiple voting shares and subordinate voting shares.

        Also, our Chief Executive Officer will be nominated to the board of directors by the Company. In addition, the shareholders' agreement will provide that for so long as TELUS continues to beneficially own at least 50% of the combined voting power of our multiple voting shares and subordinate voting shares, TELUS will be entitled, but not obligated, to select the chair of the board and the chairs of the human resources and governance and nominating committees.

        The shareholders' agreement will also provide that, so long as TELUS or Baring, as applicable, is entitled to nominate at least one individual to our board, it will be entitled, but not obligated, to designate at least one nominee for appointment to each of our human resources committee and governance and nominating committee. The shareholders' agreement will also provide that (i) so long as TELUS or Baring, as applicable, is entitled to nominate at least one individual to our board, it will be entitled, but not obligated, to designate one nominee for appointment to our audit committee for 90 days following the completion of this offering, and (ii) TELUS will continue to have such right thereafter, as long as it is entitled to nominate at least one individual to our board and, following the earlier of the first anniversary of the consummation of this offering or the appointment of a third independent director, as long as its nominee to the audit committee is independent. The above-described committee appointment rights are in each case subject to compliance with the independence requirements of applicable securities laws and listing requirements of the NYSE and TSX.

        The shareholders' agreement will also provide that, until TELUS ceases to hold at least 50% of the combined voting power of our multiple voting shares and subordinate voting shares, TELUS will have special shareholder rights related to certain matters including, among others, approving the selection, and the ability to direct the removal, of our Chief Executive Officer ("CEO"), approving the increase or decrease of the size of our board, approving the issuance of multiple voting shares and subordinate voting shares, approving amendments to our articles and authorizing the entry into a change of control transaction, disposing of all or substantially all of our assets, and commencing of liquidation, dissolution or voluntary bankruptcy or insolvency proceedings.

        See "Certain Relationships and Related Party Transactions—Our Relationship with TELUS and Baring—Shareholders' Agreement".

        Because TELUS will hold more than 50% of the combined voting power of our multiple voting shares and subordinate voting shares, we will be a "controlled company" under the corporate governance rules for NYSE-listed companies. Therefore, we will be permitted to, and we intend to, elect not to comply with certain NYSE corporate governance requirements. See "Management—Controlled Company Exemption".

        So long as we remain a foreign private issuer, we will also continue to be exempt from some of the corporate governance standards that are applicable to U.S. domestic companies under the NYSE listing requirements.

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Corporate Structure

        The following simplified diagrams illustrate our corporate structure and voting power after giving effect to the Share Class Reclassification Transactions immediately before and following the consummation of this offering, after giving effect to the acquisitions of CCC and Lionbridge AI and the Share Class Reclassification Transactions, as described on the inside front cover of this prospectus and in "Description of Share Capital" and assuming no exercise of the underwriters' over-allotment option.

GRAPHIC

GRAPHIC


(1)
Consists of shares held by TELUS Communications Inc., 1276431 B.C. Ltd., 1276433 B.C. Ltd., 1276435 B.C. Ltd., 1276436 B.C. Ltd., and TELUS International Holding Inc., each a wholly-owned subsidiary of TELUS.

(2)
For a listing of our significant subsidiaries and their respective jurisdictions of formation or incorporation, see "Business—Corporate Structure".

Corporate Information

        TELUS International (Cda) Inc. was incorporated under the Business Corporations Act (British Columbia) on January 2, 2016. We directly or indirectly own 100% of all of our operating subsidiaries. Our delivery locations, from where team members serve our clients, are operated from subsidiaries located in the relevant jurisdiction.

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        Our headquarters and principal executive offices are located at Floor 7, 510 West Georgia Street, Vancouver, British Columbia, Canada V6B 0M3 and our telephone number is (604) 695-3455. Our website address is www.telusinternational.com. The information on or accessible through our website is not part of and is not incorporated by reference into this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only.

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The Offering

Subordinate voting shares offered by us

  21,929,824 subordinate voting shares.

Subordinate voting shares offered by the selling shareholders

 

11,403,509 subordinate voting shares (or 16,403,509 subordinate voting shares if the underwriters exercise their over-allotment option in full).

Subordinate voting shares to be outstanding after this offering

 

42,715,577 subordinate voting shares (or 47,715,577 subordinate voting shares if the underwriters exercise their over-allotment option in full).

Multiple voting shares to be outstanding after this offering

 

223,728,993 multiple voting shares (or 218,728,993 multiple voting shares if the underwriters exercise their over-allotment option in full).

Over-allotment option to purchase additional subordinate voting shares

 

Baring has granted the underwriters an option, exercisable within 30 days from the date of the prospectus, to purchase up to an additional 5,000,000 subordinate voting shares solely to cover over-allotments, if any, in connection with this offering.

Voting rights

 

Following this offering, we will have two classes of shares outstanding: multiple voting shares and subordinate voting shares. The rights of the holders of our multiple voting shares and subordinate voting shares are substantially identical, except with respect to voting and conversion.

 

The subordinate voting shares will have one vote per share and the multiple voting shares will have 10 votes per share. See "Description of Share Capital—Authorized Share Capital".

 

After giving effect to this offering, the subordinate voting shares will collectively represent 16.0% of our total issued and outstanding shares and 1.9% of the combined voting power attached to all of our issued and outstanding shares (17.9% and 2.1%, respectively, if the underwriters' over-allotment option is exercised in full) and the multiple voting shares will collectively represent 84.0% of our total issued and outstanding shares and 98.1% of the combined voting power attached to all of our issued and outstanding shares (82.1% and 97.9%, respectively, if the underwriters' over-allotment option is exercised in full).

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Conversion rights

 

The subordinate voting shares are not convertible into any other class of shares. The multiple voting shares are convertible into subordinate voting shares on a one-for-one basis at the option of the holder or upon the sale of multiple voting shares to an unaffiliated third party. Our articles will also provide that multiple voting shares will automatically convert into subordinate voting shares if such multiple voting shares are held by a person other than TELUS, Baring or their respective permitted holders. In addition, multiple voting shares held by TELUS or its respective permitted holders, and multiple voting shares held by Baring or its respective permitted holders, will automatically convert into subordinate voting shares if TELUS or Baring and their respective permitted holders, as applicable, no longer as a group beneficially own at least 10%, respectively, of our issued and outstanding multiple voting shares and subordinate voting shares on a combined basis. See "Description of Share Capital—Authorized Share Capital—Conversion".

Take-over bid protection

 

In accordance with applicable Canadian regulatory requirements designed to ensure that, in the event of a take-over bid, the holders of subordinate voting shares will be entitled to participate on an equal footing with holders of multiple voting shares, we will enter into the Coattail Agreement (as defined herein) with holders of multiple voting shares. The Coattail Agreement will contain provisions customary for dual-class corporations listed on the TSX, designed to prevent transactions that otherwise would deprive the holders of subordinate voting shares of rights under applicable take-over bid legislation in Canada to which they would have been entitled if the multiple voting shares had been subordinate voting shares. See "Description of Share Capital—Certain Important Provisions of our Articles and the BCBCA—Take-Over Bid Protection".

Use of proceeds

 

We estimate that the net proceeds to us from this offering will be approximately $493.9 million, based on an assumed initial public offering price of $24.00 per share, the midpoint of the price range set forth on the cover page of this prospectus, after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. We will not receive any proceeds from the sale of subordinate voting shares in this offering by the selling shareholders, including upon the sale of subordinate voting shares if the underwriters exercise their over-allotment option.

 

We intend to use the net proceeds from this offering in order to repay outstanding borrowings under one or more revolving or term loan facilities of our credit agreement and for general corporate purposes. See "Use of Proceeds" for additional information.

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Conflicts of Interest

 

Affiliates of CIBC World Markets Inc., RBC Dominion Securities Inc., BMO Nesbitt Burns Inc., Scotia Capital Inc., TD Securities Inc., Wells Fargo Securities, LLC, MUFG Securities Americas Inc. and National Bank Financial Inc. are lenders under one or more of the revolving credit facilities or the term loan facility of our credit agreement. As described in the section entitled "Use of Proceeds", a portion of the net proceeds from this offering will be used to repay borrowings under one or more of the revolving credit facilities or the term loan facilities of our credit agreement. Because we expect that more than 5% of the net proceeds of this offering will be received by affiliates of CIBC World Markets Inc., Scotia Capital Inc., TD Securities Inc., RBC Dominion Securities Inc., BMO Nesbitt Burns Inc., Wells Fargo Securities, LLC, MUFG Securities Americas Inc. and National Bank Financial Inc. this offering is being conducted in compliance with Rule 5121, as administered by the Financial Industry Regulatory Authority, or FINRA. J.P. Morgan Securities LLC has agreed to act as the "qualified independent underwriter" with respect to this offering and has performed due diligence investigations and participated in the preparation of the registration statement of which this prospectus forms a part. See the section "Underwriting—Conflicts of Interest".

Directed Share Program

 

At our request, the underwriters have reserved up to 5% of the subordinate voting shares to be sold by us and offered by this prospectus for sale, at the initial public offering price, to certain individuals, through a directed share program, including employees, directors and other persons associated with us who have expressed an interest in purchasing subordinate voting shares in the offering. The number of subordinate voting shares available for sale to the general public will be reduced by the number of reserved subordinate voting shares sold to these individuals. Any reserved subordinate voting shares not purchased by these individuals will be offered by the underwriters to the general public on the same basis as the other subordinate voting shares offered under this prospectus. See "Underwriting—Directed Share Program" for additional information.

Proposed NYSE and TSX trading symbol for our subordinate voting shares

 

"TIXT".

Risk factors

 

You should carefully read the section entitled "Risk Factors" and other information included in this prospectus for a discussion of factors that you should consider before deciding to invest in our subordinate voting shares.

        Unless we specifically state otherwise, all information in this prospectus assumes no exercise by the underwriters of their over-allotment option to purchase up to an additional 5,000,000 subordinate voting shares from Baring.

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        The number of subordinate voting shares to be outstanding after this offering includes 21,929,824 subordinate voting shares to be issued by us in this offering (assuming the underwriters do not exercise their over-allotment option) and excludes:

    up to 3,008,781 subordinate voting shares issuable upon the exercise of U.S. dollar-denominated equity share option awards previously issued to certain of our executive officers and outstanding as of the date of this prospectus, at exercise prices ranging from $4.87 to $8.94, which includes 2,616,138 subordinate voting shares that are or will become exercisable upon the completion of this offering; and

    up to 23,980,011 subordinate voting shares issuable pursuant to the compensation plans we intend to adopt in connection with the offering.

        Upon completion of the offering, assuming no exercise of the over-allotment option by the underwriters, our issued and outstanding share capital will consist of 42,715,577 subordinate voting shares and 223,728,993 multiple voting shares.

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SUMMARY HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA

        The following tables present summary historical consolidated financial data for our business. We have derived summary consolidated statements of income and other comprehensive income data for the years ended December 31, 2019, December 31, 2018, and December 31, 2017, and summary consolidated statements of financial position data as at December 31, 2019, and December 31, 2018, from our audited consolidated financial statements included in this prospectus. The consolidated statement of financial position as at December 31, 2017, is not included in this prospectus. The summary historical consolidated financial data for the years ended December 31, 2018, and December 31, 2017, have been presented without the retrospective application of IFRS 16 Leases and may not be comparable to the summary historical consolidated financial data for the year ended December 31, 2019. We have derived summary consolidated statements of income and other comprehensive income data for the nine months ended September 30, 2020, and September 30, 2019, and summary consolidated statements of financial position data as at September 30, 2020, from our unaudited condensed interim consolidated financial statements included in this prospectus.

        The summary unaudited pro forma condensed combined consolidated statements of income for the nine months ended September 30, 2020 and 2019, and the year ended December 31, 2019, and the unaudited pro forma condensed interim consolidated statement of financial position data as at September 30, 2020, presented below have been derived from our unaudited pro forma condensed combined consolidated financial information included in this prospectus. The summary unaudited pro forma information set forth below reflects our historical combined financial information, as adjusted to give effect to the acquisitions of CCC and Lionbridge AI and the Share Class Reclassification Transactions as if such acquisitions and the Share Class Reclassification Transactions had occurred on January 1, 2019, the first day of our fiscal year ended December 31, 2019. The pro forma consolidated statement of financial position data only reflects, on a pro forma basis, adjustments for the acquisition of Lionbridge AI. The acquisition of CCC was completed on January 31, 2020, and therefore our consolidated statement of financial position as at September 30, 2020 already reflects the acquisition of CCC. The historical per common share data presented below has not been adjusted to reflect the Share Class Reclassification Transactions. Pro forma per common share data includes both subordinate voting shares and multiple voting shares. The summary unaudited pro forma information has been presented for informational purposes only and do not purport to represent the actual results of operations that we, CCC and Lionbridge AI would have achieved had we been combined during the periods presented and are not intended to project the future results of operations that the combined company may achieve as a result of these acquisitions. For more information on CCC, see "CCC", for more information on Lionbridge AI, see "Lionbridge AI" and for more information on the Share Class Reclassification Transactions, see the inside cover of the prospectus and "Description of Share Capital".

        We prepare our consolidated financial statements in accordance with IFRS as issued by the IASB. You should read this data together with our consolidated financial statements and related notes appearing elsewhere in this prospectus and the information under the captions "Capitalization", "Selected Historical Consolidated Financial Data", "Unaudited Pro Forma Condensed Combined Consolidated Financial Information" and "Management's Discussion and Analysis of Financial Condition and Results of Operations". Our historical results are not necessarily indicative of the results

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that should be expected in any future period, and our results for any interim period are not necessarily indicative of the results to be expected for a full year.

 
  Years Ended
December 31
  Nine Months Ended
September 30
 
Consolidated Statements of Income Data:
  Pro Forma
2019
  2019   2018   2017   Pro Forma
2020
  2020   Pro Forma
2019
  2019  
 
  ($ in millions, except per share amounts and percentages)
 

Revenues

                                                 

Revenues arising from service contracts with customers—service

  $ 1,571.4   $ 1,019.6   $ 834.6   $ 573.2   $ 1,350.1   $ 1,139.3   $ 1,154.0   $ 747.1  

Operating Expenses

                                                 

Goods and services purchased

    350.7     182.9     174.9     105.8     288.6     219.4     266.3     132.9  

Employee benefits expense

    929.3     630.4     522.5     366.5     793.0     708.0     686.5     463.5  

Depreciation

    85.5     73.1     31.3     25.4     73.9     72.6     62.3     53.1  

Amortization of intangible assets

    133.0     19.1     18.2     6.8     102.4     59.7     99.9     14.4  

Total Operating Expenses

    1,498.5     905.5     746.9     504.5     1,257.9     1,059.7     1,115.0     663.9  

Operating Income

    72.9     114.1     87.7     68.7     92.2     79.6     39.0     83.2  

Changes in business combination-related provisions

    (14.6 )   (14.6 )   (12.6 )       (73.4 )   (73.4 )   (2.5 )   (2.5 )

Interest expense(1)

    66.3     36.3     23.2     10.1     52.8     34.3     49.3     28.0  

Foreign exchange

    (3.7 )   (2.6 )   8.1     (0.5 )   2.2     2.2     (3.1 )   (2.3 )

Income Before Income Taxes

    24.9     95.0     69.0     59.1     110.6     116.5     (4.7 )   60.0  

Income taxes

    26.5     26.0     21.9     15.7     32.5     34.6     17.0     18.3  

Net Income

  $ (1.6 ) $ 69.0   $ 47.1   $ 43.4   $ 78.1   $ 81.9   $ (21.7 ) $ 41.7  

Net Income Per Common Share(1)

                                                 

Basic

  $ (0.01 ) $ 1.64   $ 1.12   $ 1.09   $ 0.33   $ 1.66   $ (0.09 ) $ 0.99  

Diluted

  $ (0.01 ) $ 1.63   $ 1.12   $ 1.09   $ 0.33   $ 1.65   $ (0.09 ) $ 0.99  

Other Data

                                                 

TI Adjusted Net Income(2)

  $ 133.2   $ 82.4   $ 65.4   $ 56.7   $ 100.4   $ 94.4   $ 94.6   $ 56.6  

TI Adjusted Basic Earnings per Share(2)

  $ 0.58   $ 1.95   $ 1.56   $ 1.42   $ 0.43   $ 1.92   $ 0.41   $ 1.34  

TI Adjusted Diluted Earnings per Share(2)

  $ 0.58   $ 1.95   $ 1.56   $ 1.41   $ 0.42   $ 1.90   $ 0.41   $ 1.34  

TI Adjusted EBITDA(3)

  $ 358.1   $ 225.6   $ 146.7   $ 113.8   $ 296.2   $ 262.2   $ 259.4   $ 161.9  

Cash provided by operating activities

    N/A   $ 141.6   $ 93.5   $ 90.9     N/A   $ 161.3     N/A   $ 94.0  

TI Free Cash Flow(4)

    N/A   $ 78.8   $ 43.0   $ 49.5     N/A   $ 112.2     N/A   $ 47.4  

TI Organic Revenue(5)

    N/A   $ 1,005.6   $ 607.2   $ 533.5     N/A   $ 811.0     N/A   $ 733.1  

TI Gross Profit Margin(6)

    N/A     33.2 %   32.4 %   33.5 %   N/A     31.4 %   N/A     32.8 %

TI Adjusted Gross Profit Margin (%)(6)

    N/A     42.3 %   38.3 %   39.1 %   N/A     43.0 %   N/A     41.8 %

 

 
   
   
   
   
  As at
September 30
 
 
  As at December 31   Pro Forma
as at
September 30,
2020
 
Consolidated Statement of Financial Position Data:
  2019   2018   2017   2020  
 
  ($ in millions)
   
 

Cash and temporary investments, net

  $ 79.5   $ 65.6   $ 85.4   $ 138.9   $ 138.9  

Property, plant and equipment, net

    301.0     115.2     103.5     369.5     366.7  

Intangible assets, net

    89.7     104.8     35.0     1,289.6     646.6  

Goodwill, net

    418.4     421.2     228.8     1,466.2     1,003.9  

Total assets

    1,169.0     909.1     601.9     3,725.4     2,575.5  

Current maturities of long-term debt

    42.8     6.0     6.0     90.2     77.0  

Long-term debt

    477.7     302.0     264.3     1,768.7     1,070.4  

Total liabilities

    923.2     712.4     502.1     2,775.1     1,831.4  

Common equity

    245.8     196.7     99.8     950.3     744.1  

Total liabilities and owners' equity

    1,169.0     909.1     601.9     3,725.4     2,575.5  

(1)
Historical per common share data has not been adjusted to reflect the Share Class Reclassification Transactions. Net income per common share on a pro forma basis is calculated after giving effect to the CCC and Lionbridge acquisitions and the Share Class Reclassification Transactions that will occur at the time of the offering. Pro forma per common share data includes both subordinate voting shares and multiple voting shares. For more information on the Share Class Reclassification Transactions, see the inside cover of this prospectus and "Description of Share Capital". For a calculation of basic and diluted common shares outstanding on a pro forma basis, see note (g) to footnote 2, below.

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    Net income per common share calculated on a pro forma basis does not give effect to this offering and the expected application of the net proceeds of this offering. We expect the offering will include the issuance of 21,929,824 subordinate voting shares by us at an assumed initial public offering price of $24.00 per share (which is the midpoint of the estimated price range set forth on the cover page of this prospectus). We expect to use the net proceeds from the issuance of 21,929,824 subordinate voting shares of approximately $493.9 million, after deducting the estimated underwriting discounts and commissions, to repay outstanding borrowings under our credit agreement. Interest expense for the nine months ended September 30, 2020 and the year ended December 31, 2019 on a pro forma basis would have been lower by approximately $6.3 million and $8.6 million, respectively, if the offering and the application of the net proceeds of the offering occurred on January 1, 2019.

(2)
TI Adjusted Net Income, TI Adjusted Basic Earnings per Share and TI Adjusted Diluted Earnings per Share. We regularly monitor TI Adjusted Net Income, adjusted basic earnings per share ("TI Adjusted Basic EPS") and adjusted diluted earnings per share ("TI Adjusted Diluted EPS"), which are non-GAAP financial measures, as they are useful for management and investors to better understand our ability to manage operational costs, to evaluate our operating performance, and to facilitate a period-over-period comparison of our results. We calculate TI Adjusted Net Income by excluding changes in business combination-related provisions, restructuring and other costs, share-based compensation expense, foreign exchange gain/loss and amortization of purchased intangible assets, and the related tax impacts of these adjustments, from net income, the most directly comparable GAAP measure. Changes in business combination-related provisions, share based compensation expense, foreign exchange gain/loss and amortization of purchased intangible assets are non-cash items and we do not consider these excluded items to be indicative of our operating performance. Restructuring and other costs are largely comprised of business acquisition costs and integration expenses that are not reflective of our ongoing operations. We calculate TI Adjusted Basic Earnings Per Share by dividing the TI Adjusted Net Income by the basic total weighted average number of common shares outstanding during the period. We calculate TI Adjusted Diluted Earnings Per Share by dividing the TI Adjusted Net Income by the diluted total weighted average number of common shares outstanding during the period. TI Adjusted Diluted Earnings Per Share is calculated to give effect to share option awards and restricted share units. Historical per common share data presented below has not been adjusted to reflect the Share Class Reclassification Transactions.
 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  Pro Forma
2019(a)
  2019   2018   2017   Pro Forma
2020(a)
  2020   Pro Forma
2019(a)
  2019  
 
  ($ in millions, except per share amounts)
 

Net income

  $ (1.6 ) $ 69.0   $ 47.1   $ 43.4   $ 78.1   $ 81.9   $ (21.7 ) $ 41.7  

Add back (deduct):

                                                 

Changes in business combination-related provisions(b)

    (14.6 )   (14.6 )   (12.6 )       (73.4 )   (73.4 )   (2.5 )   (2.5 )

Restructuring and other costs(c)

    52.9     6.1     3.7     8.9     10.2     33.2     50.8     4.0  

Share-based compensation expense(d)

    13.8     13.2     5.8     4.0     17.5     17.1     7.4     7.2  

Foreign exchange (gain) loss(e)

    (3.7 )   (2.6 )   8.1     (0.5 )   2.2     2.2     (3.1 )   (2.3 )

Amortization of purchased intangible assets(f)

    127.9     14.9     14.7     3.2     96.3     53.6     96.0     11.1  

Tax effect of the adjustments above

    (41.5 )   (3.6 )   (1.4 )   (2.3 )   (30.5 )   (20.2 )   (32.3 )   (2.6 )

TI Adjusted Net Income

  $ 133.2   $ 82.4   $ 65.4   $ 56.7   $ 100.4   $ 94.4   $ 94.6   $ 56.6  

TI Adjusted Basic Earnings per Share(g)

  $ 0.58   $ 1.95   $ 1.56   $ 1.42   $ 0.43   $ 1.92   $ 0.41   $ 1.34  

TI Adjusted Diluted Earnings per Share(g)

  $ 0.58   $ 1.95   $ 1.56   $ 1.41   $ 0.42   $ 1.90   $ 0.41   $ 1.34  

(a)
The Lionbridge AI net income component of pro forma TI Adjusted Net Income, TI Adjusted Basic EPS and TI Adjusted Diluted EPS includes shared cost allocations from the parent company of approximately $22 million in 2019 and approximately $18 million in 2018. We anticipate the equivalent costs to be approximately $10 million to operate Lionbridge AI as a standalone entity on a full year basis.

(b)
Changes in business combination-related provisions is largely comprised of non-cash accounting gains recognized on the revaluation and settlement of provisions for written put option liabilities to acquire the remaining non-controlling interests in our subsidiaries.

(c)
Restructuring and other costs are largely comprised of business acquisition costs and integration expenses, which include goods and services purchased and employee benefit expenses that are not reflective of our ongoing operations. These costs are dependent on a number of factors and are generally inconsistent in amount and frequency, as well as significantly impacted by the timing and size of related acquisitions. Additionally, the size, complexity and volume of past acquisitions, which often drives the magnitude of acquisition related costs, may not be indicative of the size,

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    complexity and volume of future transactions. These costs are included in our operating results, as set out in the following table:

 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  Pro Forma
2019
  2019   2018   2017   Pro Forma
2020
  2020   Pro Forma
2019
  2019  
 
  ($ in millions)
 

Goods and services purchased

  $ 52.6   $ 5.8   $ 0.6   $ 7.7   $ 7.5   $ 30.5   $ 50.7   $ 3.9  

Employee benefits expense

    0.3     0.3     3.1     1.2     2.7     2.7     0.1     0.1  

Restructuring and other costs

  $ 52.9   $ 6.1   $ 3.7   $ 8.9   $ 10.2   $ 33.2   $ 50.8   $ 4.0  
(d)
We exclude share-based compensation expense because it is a non-cash charge and the changes in the value of our company may have a significant impact on share-based compensation expense in any given period, which can prevent a comparison of our operating results among the periods.

(e)
We exclude foreign exchange adjustments because it allows for comparison of operating results among the periods, without regard to fluctuations in the foreign exchange rates to which we have exposure and which result in fluctuations that are not reflective of the underlying performance of our business.

(f)
We exclude amortization of purchased intangible assets because this is a non-cash charge and it allows management and investors to evaluate our operating results as if these assets had been developed internally rather than acquired in a business combination. We do not exclude the revenue generated by such purchased intangible assets from our revenues and, as a result, TI Adjusted Net Income includes revenue generated, in part, by such purchased intangible assets.

(g)
The following table presents reconciliations of the denominators of the basic and diluted per share computations on a historical and pro forma basis:
 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  Pro Forma
2019
  2019   2018   2017   Pro Forma
2020
  2020   Pro Forma
2019
  2019  

Basic total weighted average number of common shares outstanding

    230,728,356     42,151,421     41,931,848     40,000,000     236,131,200     49,279,664     230,728,356     42,151,421  

Effect of dilutive securities

                                                 

Share option awards

    629,105     139,801     89,310     72,809     1,401,921     311,538     515,736     114,608  

Diluted total weighted average number of common shares outstanding

    231,357,461     42,291,222     42,021,158     40,072,809     237,533,121     49,591,202     231,244,092     42,266,029  

    Historical common shares outstanding has not been adjusted to reflect the Share Class Reclassification Transactions. The shares outstanding on a pro forma basis does not give effect to the expected issuance of 21,929,824 million subordinate voting shares by us in connection with this offering.

    For more information on the Share Class Reclassification Transactions, see the inside cover of this prospectus and "Description of Share Capital".

    We expect to use the net proceeds of this offering of $493.9 million to repay outstanding borrowings under our credit agreement. As a result of this repayment our interest expense will be reduced. See note 1 above. Assuming the consummation of this offering and the application of the proceeds from the offering as described above had occurred on January 1, 2019, our pro forma basic and diluted common shares outstanding and our pro forma net income per common share, as adjusted, in each case for the offering, as of September 30, 2020 would have been:

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  Pro Forma
Full Year
Ended
December 31,
2019
  Pro Forma
Nine Months
Ended
September 30,
2020
 

Numerator:

             

Pro forma net income (loss)

  $ (1.6 ) $ 78.1  

Interest expense, net-of-tax, that would not have been incurred

    8.6     6.3  

Pro forma net income, as adjusted for the offering

    7.0     84.4  

Denominator:

   
 
   
 
 

Pro forma basic total weighted average number of shares outstanding

    230,728,356     236,131,200  

Number of subordinate voting shares whose proceeds will be used to repay debt

    21,929,824     21,929,824  

Pro forma basic total weighted average number of shares outstanding, as adjusted for the offering

    252,658,180     258,061,024  

Effect of dilutive securities

    629,105     1,401,921  

Pro forma diluted total weighted average number of shares outstanding, as adjusted for the offering

    253,287,285     259,462,945  

Pro forma basic earnings per share, as adjusted for the offering

  $ 0.03   $ 0.33  

Pro forma diluted earnings per share, as adjusted for the offering

  $ 0.03   $ 0.33  
(3)
TI Adjusted EBITDA.    We regularly monitor TI Adjusted EBITDA, which is a non-GAAP financial measure, because this is a key measure regularly used by management to evaluate our business performance. As such, we believe it is useful to investors in understanding and evaluating the performance of our business. This measure excludes from net income non-cash items and items that do not reflect the underlying performance of our business and should not, in our opinion, be considered in a valuation metric, or should not be included in an assessment of our ability to service or incur debt. These items were added back for the same reasons described above in TI Adjusted Net Income. TI Adjusted EBITDA should not be considered an alternative to net income in measuring our performance, and it should not be used as an exclusive measure of cash flow. We believe a net income measure that excludes these non-cash items and items that do not reflect the underlying performance of our business is more reflective of underlying business trends, our operational performance and overall business strategy.
 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  Pro Forma
2019(e)
  2019   2018   2017   Pro Forma
2020(e)
  2020   Pro Forma
2019(e)
  2019  
 
  ($ in millions)
 

Net income

  $ (1.6 ) $ 69.0   $ 47.1   $ 43.4   $ 78.1   $ 81.9   $ (21.7 ) $ 41.7  

Add back (deduct):

                                                 

Changes in business combination-related provisions(a)

    (14.6 )   (14.6 )   (12.6 )       (73.4 )   (73.4 )   (2.5 )   (2.5 )

Interest expense

    66.3     36.3     23.2     10.1     52.8     34.3     49.3     28.0  

Foreign exchange(b)

    (3.7 )   (2.6 )   8.1     (0.5 )   2.2     2.2     (3.1 )   (2.3 )

Income taxes

    26.5     26.0     21.9     15.7     32.5     34.6     17.0     18.3  

Depreciation and amortization

    218.5     92.2     49.5     32.2     176.3     132.3     162.2     67.5  

Share-based compensation expense(c)

    13.8     13.2     5.8     4.0     17.5     17.1     7.4     7.2  

Restructuring and other costs(d)

    52.9     6.1     3.7     8.9     10.2     33.2     50.8     4.0  

TI Adjusted EBITDA

  $ 358.1   $ 225.6   $ 146.7   $ 113.8   $ 296.2   $ 262.2   $ 259.4   $ 161.9  

(a)
Changes in business combination-related provisions is largely comprised of non-cash accounting gains recognized on the revaluation and settlement of provisions for written put option liabilities to acquire the remaining non-controlling interests in our subsidiaries.

(b)
We exclude foreign exchange adjustments because we believe such exclusion allows for comparison of our operating results among the periods, without regard to fluctuations in the foreign exchange rates to which we have exposure as these fluctuations are not reflective of the underlying performance of our business.

(c)
We exclude share-based compensation expense because it is a non-cash charge and the changes in the value of the Company may have a significant impact on share-based compensation expense in any given period, which can prevent a comparison of our operating results among the periods.

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(d)
Restructuring and other costs are largely comprised of business acquisition costs and integration expenses, which include goods and services purchases and employee benefit expenses that are not reflective of our ongoing operations. These costs are dependent on a number of factors and are generally inconsistent in amount and frequency, as well as significantly impacted by the timing and size of related acquisitions. Additionally, the size, complexity and volume of past acquisitions which often drives the magnitude of acquisition related costs, may not be indicative of the size, complexity and volume of future transactions. These costs are included in our operating results as set out in the following table:

(e)
The Lionbridge AI component of pro forma TI Adjusted EBITDA includes shared cost allocations from the parent company of approximately $22 million in 2019 and approximately $18 million in 2018. We anticipate the equivalent costs to be approximately $10 million to operate Lionbridge AI as a standalone entity on a full year basis.
 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  Pro Forma
2019
  2019   2018   2017   Pro Forma
2020
  2020   Pro Forma
2019
  2019  
 
  ($ in millions)
 

Goods and services purchased

  $ 52.6   $ 5.8   $ 0.6   $ 7.7   $ 7.5   $ 30.5   $ 50.7   $ 3.9  

Employee benefits expense

    0.3     0.3     3.1     1.2     2.7     2.7     0.1     0.1  

Restructuring and other costs

  $ 52.9   $ 6.1   $ 3.7   $ 8.9   $ 10.2   $ 33.2   $ 50.8   $ 4.0  
(4)
TI Free Cash Flow.    We use free cash flow ("TI Free Cash Flow"), which is a non-GAAP financial measure, and ratios based on it, to conduct and evaluate our business because, although it is similar to cash provided by operating activities, we believe it is a more conservative measure of cash flows since capital expenditures are a necessary component of our ongoing operations and our liquidity assessment. We calculate TI Free Cash Flow by excluding capital expenditures from cash provided by operating activities.
 
  Years Ended
December 31
  Nine Months Ended
September 30
 
 
  2019   2018   2017   2020   2019  
 
  ($ in millions)
 

Cash provided by operating activities

  $ 141.6   $ 93.5   $ 90.9   $ 161.3   $ 94.0  

Less: capital expenditures

    (62.8 )   (50.5 )   (41.4 )   (49.1 )   (46.6 )

TI Free Cash Flow

  $ 78.8   $ 43.0   $ 49.5   $ 112.2   $ 47.4  
(5)
TI Organic Revenue.    We regularly monitor organic revenue ("TI Organic Revenue"), which is a non-GAAP financial measure, as it is a useful measure for management and investors to understand and evaluate how we are integrating our acquisitions and to facilitate a year-over-year comparison of our results. TI Organic Revenue excludes revenue arising from contracts with customers-service generated from our acquisitions in the twelve-month period after the date of each acquisition ("TI Acquisition Revenue"). We calculate year-over-year growth in TI Organic Revenue as TI Organic Revenue in the current year less revenue in the prior year divided by revenue in the prior year, which in 2019 was 20% and 2018 was 6%.
 
  Years Ended
December 31
  Nine Months
Ended
September 30
 
 
  2019   2018   2017   2020   2019  
 
  ($ in millions)
 

Revenues arising from contracts with customers—service

  $ 1,019.6   $ 834.6   $ 573.2   $ 1,139.3   $ 747.1  

Less: TI Acquisition Revenue

    (14.0 )   (227.4 )   (39.7 )   (328.3 )   (14.0 )

TI Organic Revenue

  $ 1,005.6   $ 607.2   $ 533.5   $ 811.0   $ 733.1  
(6)
TI Adjusted Gross Profit and TI Adjusted Gross Profit Margin.    Gross profit excluding depreciation and amortization ("TI Adjusted Gross Profit") and adjusted gross profit margin ("TI Adjusted Gross Profit Margin") are useful measures for management and investors alike to assess how efficiently we are servicing our clients and to be able to evaluate the growth in our cost base, excluding depreciation and amortization, as a percentage of revenue. We calculate TI Adjusted Gross Profit by excluding depreciation and amortization from the nearest GAAP measure, gross profit. We exclude depreciation and amortization expense because the timing of the underlying capital expenditures and other investing activities do not correlate directly with the revenue from contracts with clients in a given reporting period. TI Adjusted Gross Profit subtracts from revenue delivery costs including salaries, bonuses, fringe benefits, contractor fees and client-related travel costs for our team members who are assigned to client queues as well as licensing fees, network infrastructure costs and facilities costs required to service our clients. We calculate TI Gross Profit Margin as gross profit divided by revenues

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    arising from contracts with customers. We calculate TI Adjusted Gross Profit Margin as TI Adjusted Gross Profit divided by revenues arising from contracts with customers.

 
  Years Ended
December 31
  Nine Months
Ended
September 30
 
 
  2019   2018   2017   2020   2019  
 
  ($ in millions, except percentages)
 

Revenues arising from contracts with customers—service

  $ 1,019.6   $ 834.6   $ 573.2   $ 1,139.3   $ 747.1  

Less: Operating expenses

    (905.5 )   (746.9 )   (504.5 )   (1,059.7 )   (663.9 )

Add back: Indirect and administrative expenses

    224.7     182.4     123.2     277.7     161.5  

Gross profit

    338.8     270.1     191.9     357.3     244.7  

Add back: Depreciation and amortization

    92.2     49.5     32.2     132.3     67.5  

TI Adjusted Gross Profit

  $ 431.0   $ 319.6   $ 224.1   $ 489.6   $ 312.2  

TI Gross Profit Margin

    33.2 %   32.4 %   33.5 %   31.4 %   32.8 %

TI Adjusted Gross Profit Margin

    42.3 %   38.3 %   39.1 %   43.0 %   41.8 %

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RISK FACTORS

        This offering and investing in our subordinate voting shares involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information contained in this prospectus, including our consolidated financial statements and the related notes appearing at the end of this prospectus, before deciding to invest in our subordinate voting shares. Other risks and uncertainties that we do not presently consider to be material, or of which we are not presently aware, may become important factors that affect our future financial condition and financial performance. If any of those or the following risks actually occur, our business, financial condition, financial performance, liquidity and prospects could suffer materially, the trading price of our subordinate voting shares could decline and you could lose all or part of your investment. See also "Special Note Regarding Forward-Looking Statements".

Risks Related to Our Business

We face intense competition from companies that offer services similar to ours. If we are unable to differentiate to compete effectively, our business, financial performance, financial condition and cash flows could be materially adversely impacted.

        The market for the services we offer is very competitive and we expect competition to intensify and increase from a number of our existing competitors, including professional services companies that offer consulting services, information technology companies with digital capabilities, and traditional contact center and business process outsourcing ("BPO") companies that are expanding their capabilities to offer higher-margin and higher-growth digital services. In addition, the continued digital expansion of the services we offer and the markets we operate in will result in new and different competitors, many of which may have significantly greater market recognition than we do in the markets we are entering, as well as increased competition with existing competitors who are also expanding their services to cover digital capabilities.

        Many of these existing and new competitors have greater financial, human and other resources, greater technological expertise, longer operating histories and more established relationships in the verticals that we currently serve or may expand to serve in the future. In addition, some of our competitors may enter into strategic or commercial relationships among themselves or with larger, more established companies in order to increase their ability to address client needs or enter into similar arrangements with potential clients. In addition, we compete with other service providers for talent in some of the regions in which we operate, particularly where access to a qualified workforce is limited, which can impact our talent recruitment efforts and increase our attrition and labor cost. We also face competition from service providers that operate in countries where we do not have delivery locations because our clients may, to diversify geographic risk and for other reasons, seek to reduce their dependence on any one country by shifting work to another country in which we do not operate. All of these factors present challenges for us in retaining and growing our business.

        From time to time, our clients who currently use our services may determine that they can provide these services in-house. As a result, we face the competitive pressure to continually offer our services in a manner that will be viewed by our clients as better and more cost-effective than what they could provide themselves.

        Our inability to compete successfully against companies that offer services similar to ours and to offer our clients a compelling alternative to taking the services we provide in-house could result in increased client churn, revenue loss, pressures on recruitment and retention of team members, service price reductions and increased marketing and promotional expenses, or reduced operating margins which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

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Our ability to grow and maintain our profitability could be materially affected if changes in technology and client expectations outpace our service offerings and the development of our internal tools and processes, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        Our growth, profitability and the diversity of our revenue sources will depend on our ability to develop and adopt new technologies to expand our existing offerings, proactively identify new revenue streams and improve cost efficiencies in our operations, all while meeting rapidly evolving client expectations. Although we are focused on maintaining and enhancing the range of our digital offerings, we may not be successful in anticipating or responding to our clients' expectations and interests in adopting evolving technology solutions and the integration of these technology solutions into our offerings may not achieve the intended enhancements or cost reductions in our operations. New services and technologies offered by our competitors may make our service offerings uncompetitive, which may reduce our clients' interest in our offerings and our ability to attract new clients. Our failure to innovate, maintain technological advantages or respond effectively and timely to changes in technology could have a material adverse effect on our business, financial performance, financial condition and cash flows.

If we fail to establish our digital brand and successfully market our digital service offerings, our growth prospects, anticipated business volumes and financial performance may be adversely affected.

        Certain of our existing clients and potential new clients may only know us for our voice-based customer support services. Our ability to realize our digital first strategy and increase revenue across our core verticals, including Tech and Games, Communications and Media, eCommerce and FinTech, Healthcare and Travel and Hospitality, depends on our promotion of our ability to provide digital services in these areas to existing and potential clients. If we are not successful in establishing our digital brand and marketing our expanded service offerings to our existing and potential clients, our ability to shift our existing clients into more profitable digital services and attract new clients to these service offerings may be limited, which may adversely affect our growth prospects and anticipated business volumes and financial performance.

If we cannot maintain our culture as we grow, our services, financial performance and business may be harmed.

        We believe that our unique customer first and caring culture has led to our ability to attract and retain a highly skilled, engaged and motivated workforce. This has driven our strong client retention and the higher satisfaction scores we receive from our clients' customers, which has, in part, been responsible for our growth and differentiation in the marketplace. It may become more difficult for us to maintain a culture that supports our success if we continue to evolve our products and services, grow into new geographies, open new delivery locations, increase the number of team members and acquire new companies. If our unique culture is not maintained, our ability to attract and retain highly skilled team members and clients across our core verticals may be adversely impacted, and our operational and financial results may be negatively affected.

If we fail to maintain a consistently high level of service experience and implement and communicate high quality corporate sustainability and social purpose activities, our ability to attract new and retain existing clients and team members could be adversely affected.

        Our clients' loyalty, likelihood to expand the services that they use with us and the likelihood to recommend us is dependent upon our ability to provide a service experience that meets or exceeds our clients' expectations and that is differentiated from our competitors. Our ability to attract new clients, retain our existing clients and attract and retain team members is highly dependent on the satisfaction ratings that our clients provide about us and the satisfaction ratings that our clients receive from their

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customers based on the services we provide, all of which affects our reputation. We believe our focus on client experience is critical to attracting new clients and retaining and growing our business with our existing clients. If we are unable to maintain a consistently high level of service, our clients could change service providers, our revenues and profitability could be negatively impacted, and our reputation could suffer.

        In addition, the corporate sustainability and social purpose activities in which we are involved also assist us in attracting and retaining clients. The corporate sustainability and social purpose activities that we are involved in are important to our company and are a part of our culture, and thus it is also becoming a differentiating factor for clients in selecting a service provider. More and more companies, including many of our clients, are demanding that their service providers embody corporate sustainability and social purpose goals that reflect their own brand image and are consistent with the ones their customers and other stakeholders have adopted. If we are unable to meet or exceed the evolving expectations of our clients in these areas or implement high quality corporate sustainability and social purpose activities on a timely basis, and effectively communicate them to our clients, our reputation may suffer, which may negatively impact our ability to attract new and retain existing clients. Our corporate sustainability and social purpose activities are also important to our team members, and our failure to meet or exceed the evolving expectations of our team members in these areas could have adverse impacts on our ability to attract and retain talent upon which our service offerings depend. As a result, we have in the past invested significant resources in developing and maintaining our corporate sustainability and social purpose activities, and the required levels of such investments may increase in the future as such activities become increasingly important to our clients and team members, which would increase our costs and may adversely affect our financial performance and cash flows.

        Although we strive to implement a "customer-first" culture, any failure to maintain a consistently high level of customer service, or a market perception that we do not maintain high-quality customer service, or a failure to communicate effectively or meet our clients' and team members' expectations about our corporate sustainability and social purposes initiatives, could adversely affect our ability to attract new clients and retain existing clients, and increase attrition and other costs associated with retaining talent, all of which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

Our business and financial results could be adversely affected by economic and geopolitical conditions and the effects of these conditions on our clients' businesses and levels of business activity, demand for our services, as well as our and our clients' liquidity and access to capital.

        The COVID-19 pandemic has caused, and is likely to continue to cause, additional slowdown in the global economy, as is evidenced by the recent declines in investments, exports and industrial production. The global spread of COVID-19 has created, and is likely to continue to create, significant volatility, uncertainty and economic disruption. In addition, volatility in the domestic politics of major markets may lead to changes in the institutional framework of the international economy. For further information, see "—Our business and financial results have been, and in the future may be, adversely impacted by the COVID-19 pandemic".

        The global economy has entered into a deep recessionary period and there continue to be similar signs of continued economic slowdown and weakness around the world. Globally, countries may require additional financial support, sovereign credit ratings may continue to decline and there may be default on sovereign debt obligations of certain countries. Any of these global economic conditions may increase the cost of borrowing and cause credit to become more limited, which could have a material adverse effect on our business, financial condition, financial performance and cash flows.

        Changes in the general level of economic activity, such as decreases in business and consumer spending, could result in a decrease in demand for the products and services that our clients provide to

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their customers, and consequently reduce our clients' demand for our services, which would reduce our revenue. Economic and political uncertainty could undermine business confidence and cause potential new clients to delay engaging us and our existing clients to reduce or defer their spending on our services or reduce or eliminate spending under existing contracts with us. These developments, or the perception that any of them could occur, have had and may continue to have a material adverse effect on global economic conditions and the stability of global financial markets. For example, the withdrawal of the United Kingdom from the European Union in January 2020, commonly referred to as "Brexit", has created significant political and economic uncertainty regarding the future trading relationship between the United Kingdom and the European Union. These and other economic and geopolitical conditions may affect our business in a number of ways, as we have operations in over 20 countries and we service clients across multiple geographic regions. If any of these conditions affect the countries in which our largest clients, including TELUS, are located or conduct their business, we may experience reduced demand for and pricing pressure on our services, which could lead to a reduction in business volumes and could adversely affect financial performance.

        The cost and availability of credit has been and may continue to be adversely affected by illiquid credit markets and wider credit spreads. The current global economic slowdown and the possibility of continued turbulence or uncertainty in the European Union, United States, countries in Asia and international financial markets and economies, and the political climate in the United States, may adversely affect our liquidity and financial condition, and the liquidity and financial condition of our clients. If these market conditions continue or worsen, it may limit our ability to access financing or increase our cost of financing to meet liquidity needs, and affect the ability of our clients to use credit to purchase our services or to make timely payments to us, which could result in material adverse effects on our business, financial condition, financial performance and cash flows.

        We cannot predict the timing or duration of an economic slowdown or the timing or strength of a subsequent economic recovery generally or in our targeted verticals, including Travel and Hospitality. If macroeconomic conditions worsen or the current global economic conditions continue for a prolonged period of time, we are not able to predict the impact that such conditions will have on our business, financial condition, financial performance and cash flows.

If we are unable to accurately forecast our pricing models or optimize the mix of products and services we provide to meet changing client demands, or if we are unable to adapt to changing pricing and procurement demands of our clients, our business, financial performance, financial condition and cash flows may be adversely affected.

        Our contracts generally use a pricing model that provides for per-productive-hour or per-transaction billing models and compensation for materials and licensing costs. Industry pricing models are evolving, and companies are increasingly requesting transaction- or outcome-based pricing or other alternative pricing models, which require us to accurately forecast the cost of performance of the contract against the compensation we expect to receive. These forecasts are based on a number of assumptions relating to existing and potential contracts with existing and potential clients, including assumptions related to the team members, other resources and time required to perform the services and our clients' ultimate use of the contracted service. If we make inaccurate assumptions in pricing our contracts, our profitability may be negatively affected. In addition, if the number of our clients that request alternative pricing models continues to increase in line with industry trends, we may be unable to maintain our historical levels of profitability under these evolving alternative pricing models and our financial performance may be adversely affected, or we may not be able to offer pricing that is attractive relative to our competitors. Some of our clients' may continue to evolve their procurement methodology by increasing the use of alternative methods, such as reverse auctions. These methods may impact our ability to gain new business and maintain profit margins, and may require us to adapt our sales techniques, which we may be unsuccessful in doing in a timely manner or at all.

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        In addition, the revenue and income generated from the services we provide to our clients may decline or vary as the type and volume of services we provide under our contracts change over time, including as a result of a shift in the mix of products and services provided. For example, our lower-complexity interactions, such as voice-based interaction services, generate services with lower margins compared to our more complex, sensitive and localized content moderation and digital services, and a shift in the mix of these two types of services by a client could cause a meaningful change in our revenue from that client and the profitability of the services we provide. Furthermore, our clients, some of which have experienced significant and adverse changes in their business, substantial price competition and pressures on their profitability, have in the past and may in the future demand price reductions, decrease the volume of work or complexity of the services we are providing to them, automate some or all of their processes or change their customer experience strategy by moving more work in-house or to other providers, any of which could reduce our profitability. Any inability to accurately forecast the pricing that we use for our contracts, or any significant reduction in or the elimination of the use of the services we provide to any of our clients or any requirement to lower our prices that, in each case, we fail to anticipate, would harm our business, financial performance, financial condition and cash flows.

Two clients account for a significant portion of our revenue and loss of or reduction in business from, or consolidation of, these or any other major clients could have a material adverse effect on our business, financial condition, financial performance and prospects.

        We have derived and believe that, in the near term, we will continue to derive, a significant portion of our revenue from a limited number of large clients. TELUS, our controlling shareholder, is our largest client and, for the fiscal years ended December 31, 2019 and 2018, TELUS accounted for approximately 26% and 24% of our revenue. For the nine-month period ended September 30, 2020, TELUS accounted for approximately 20% of our revenue, respectively. Google, Inc. ("Google") was our second largest client in the fiscal years ended December 31, 2019 and 2018 and accounted for approximately 12% and 14% of our revenue in such periods, respectively. In addition, Google is the largest client of Lionbridge AI, the data annotation business we acquired on December 31, 2020. Google accounted for 65% of Lionbridge AI's revenue in the year ended December 31, 2019. As a result of our acquisition of Lionbridge AI, an even greater percentage of our revenue will be dependent on Google. Our second largest client for the nine-month period ended September 30, 2020, which is a leading social media company, represented approximately 16% of our revenue for such period. We do not have a comparative figure for this client for the same period in the previous year.

        Our largest client, based on our revenues earned from them, is TELUS, our controlling shareholder. We provide services to TELUS under the TELUS MSA, which was renewed effective January 1, 2021. The renewed TELUS MSA provides for a new ten-year term commencing January 2021. The renewed TELUS MSA provides for a minimum annual spend of $200.0 million, subject to adjustment in accordance with its terms, although TELUS has the ability to delay or terminate specific services for certain specified reasons with limited notice. See "Certain Relationships and Related Party Transactions—Our Relationship with TELUS—Master Services Agreement". In addition, the master services agreements ("MSAs") with all other clients do not have minimum annual spend and the terms of these master service agreements permit our clients to delay, postpone or even terminate contracted services at their discretion and with limited notice to us.

        Additionally, the volume of work performed for specific clients or the revenue we generate can vary from year to year. For example, a client may demand price reductions, change its customer engagement strategy or move work in-house. Also, in many of the verticals in which we offer services, the continued consolidation activity could result in the loss of a client if, as a result of a merger or acquisition involving one or more of our clients, the surviving entity chooses to use one of our competitors for the services we currently provide or to provide the services we offer in-house. Our

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clients may also choose to consolidate their providers as they grow, as their business needs change, or as their leadership changes, and we could be removed from a client's vendor network. As a result of the foregoing, a major client in one year may not provide the same level of revenue in any subsequent year. Any significant reduction in or elimination of the use of the services we provide as a result of consolidation or our removal from a key client's provider network would result in reduced revenue to us and could harm our business. In addition, such consolidation may encourage clients to apply increasing pressure on us to lower the prices we charge for our solutions. All the foregoing could have a material adverse effect on our business, financial condition, financial performance and prospects.

Our client contracts, which can be canceled at any time, are generally long-term, requiring us to estimate the resources and time required for the contracts upfront, and contain certain price benchmarking, compliance-related penalties and other provisions adverse to us, all of which could have an adverse effect on our business, financial performance, financial condition and cash flows.

        Although the term of our client contracts typically ranges from three to five years, with the vast majority of contracts having a term of three years, such contracts may be terminated by our clients for convenience with limited notice and without payment of a penalty or termination fee. Additionally, our clients, other than TELUS, are not contractually committed to provide us with specific volumes under the contracts we enter into with them. Our clients may also delay, postpone, cancel or remove certain of the services we provide without canceling the whole contract, which would adversely impact our revenue. Any failure to meet a client's expectations could result in a cancellation or non-renewal of a contract or a reduction in the services provided by us. We may not be able to replace any client that elects to terminate or not renew its contract with us, which would reduce our revenues. The loss of or financial difficulties at any of our clients could have an adverse effect on our business, financial performance, financial condition and cash flows. For example, certain of our clients in our Travel and Hospitality vertical have experienced adverse pressures on their businesses as a result of the COVID-19 pandemic, which has affected the revenue we receive from these engagements, and we have had clients who entered into insolvency proceedings and have defaulted on their obligations to us.

        Additionally, our contracts require us to comply with, or facilitate, our clients' compliance with numerous and complex legal regimes on matters such as anti-corruption, internal and disclosure control obligations, data privacy and protection, wage-and-hour standards, and employment and labor relations. Many of our contracts contain provisions that would require us to pay penalties to our clients and/or provide our clients with the right to terminate the contract if we do not meet pre-agreed service level requirements. Failure to meet these requirements or accurately estimate the productivity benefits could result in the payment of significant penalties to our clients, which in turn could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        A few of our contracts allow the client, in certain limited circumstances, to request a benchmark study comparing our pricing and performance with that of an agreed list of other service providers for comparable services. Based on the results of the study and depending on the reasons for any unfavorable variance, we may be required to make improvements in the services we provide, reduce the pricing for services on a prospective basis to be performed under the remaining term of the contract, or our clients could elect to terminate the contract, any of which could have an adverse effect on our business, financial performance, financial condition and cash flows.

        Some of our contracts contain provisions which, to various degrees, restrict our ability to provide certain services to other of our clients or to companies who are in competition with our clients. Such terms may restrict the same team members from providing services for competing clients, require us to ensure a certain distance between the locations from where we serve competing clients or prevent us from serving a competing client from locations in the same country, all of which reduce our flexibility in deploying our team members and delivery locations in the most effective and efficient manner and

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may force us to forego opportunities to attract business from companies that compete with our existing clients, even if such opportunities are more profitable or otherwise attractive to us.

        Additionally, a number of our service contracts provide for high or unlimited liability for the benefit of our clients related to damages resulting from breaches of privacy or data security in connection with provision of our services. Violations of the terms of these contracts could subject us to significant legal liability. See "—The unauthorized disclosure of sensitive or confidential client and customer data could expose us to protracted and costly litigation, damage our reputation and cause us to lose clients".

        Furthermore, in some of our digital customer experience management contracts we commit to long-term pricing structures under which we bear the risk of cost overruns, completion delays, resource requirements, wage inflation and adverse movements in exchange rates in connection with these contracts. If we fail to accurately estimate the team members, other resources and time required for these longer term contracts and their overall expected profitability, potential productivity benefits over time, future wage inflation rates or currency exchange rates (if we fail to effectively hedge our currency exchange rate exposure) or if we fail to complete our contractual obligations within the contracted timeframe, our financial performance, financial condition and cash flows may be negatively affected. See "—If we are unable to accurately forecast our pricing models or optimize the mix of products and services we provide to meet changing client demands, or if we are unable to adapt to changing pricing and procurement demands of our clients, our business, financial performance, financial condition and cash flows may be adversely affected".

We may face difficulties in delivering complex projects for our clients that could cause clients to discontinue their work with us, which may have a material adverse impact on our financial performance, financial condition and cash flows.

        We have, over time, been expanding the nature, scope and complexity of our engagements. Our ability to offer a wider breadth of more complex services to our clients depends on our ability to attract new or existing clients to an expanded collection of service offerings. When seeking to obtain engagements for complex projects, we are more likely to compete with large, well-established international firms, many of which have greater resources and market reputation than we do. To compete for these projects, we will likely incur increased sales and marketing costs. Obtaining mandates for more complex projects will require us to establish closer relationships with our clients and develop a more thorough understanding of their operations. Our ability to establish such relationships will depend on a number of factors, including our ability to form a team with the necessary proficiency in these new services. We cannot be certain that we will effectively meet client needs at the necessary scale in the required timeframes in connection with these services. For example, if a new program requires us to hire a large number of team members with specific skills in a specific geography, we could face challenges in implementing the program on a client's desired timetable or at all. Our failure to deliver services that meet the requirements specified by our clients could result in termination of client contracts, which could result in us being liable to our clients for significant penalties or damages and negatively impact our reputation. More complex projects may involve multiple engagements or stages, and there is a risk that a client may choose not to retain us for later stages or may cancel or delay additional planned engagements, which may be the more profitable portions of the overall planned engagement. Such cancellations or delays make it difficult to plan for project resource requirements and inaccuracies in such resource planning and allocation may have a material adverse impact on our financial performance, financial condition and cash flows.

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We often face a long selling cycle to secure a new client or a new program with an existing client. If we are not successful in obtaining and efficiently maintaining contractual commitments after the selling cycle our business, financial performance, financial condition and cash flows may be adversely affected.

        We often face a long selling cycle to secure a new client contract or launch a new program for an existing client. When we are successful in obtaining a new engagement, which is generally followed by a long implementation period in which the services are planned in detail and we demonstrate to a client that we can successfully integrate our processes and resources with their operations. During this time a contract is also negotiated and agreed. Before or after entering into a definitive contract with a client, we may run a pilot program that may or may not be successful. There is then a long ramping up period in order to commence providing the services. We typically incur significant business development expenses during the selling cycle and may experience misalignment with the client on the magnitude of investment. Misalignment may occur when the client does not have prior experience with the type and scope of services that we are offering. At the end of this selling cycle, we may not succeed in winning a new client's business due to a variety of factors, including changes in the client's decision to move forward with our services, in which case we receive no revenues and may receive no reimbursement for such expenses. A potential client may choose a competitor or decide to perform the work in-house prior to the time a final contract is signed. Our clients may also experience delays in obtaining internal approvals or delays associated with technology or system implementations, thereby further lengthening the implementation cycle. If we enter into a contract with a client, we will typically receive no revenues until implementation actually begins. If we are not successful in obtaining contractual commitments after the selling cycle, in maintaining contractual commitments after the implementation cycle or in maintaining or reducing the duration of unprofitable initial periods in our contracts, our business, financial performance, financial condition and cash flows may be adversely affected.

        The COVID-19 pandemic has exacerbated the risks and costs described in this section, including, in certain cases, by lengthening the sales cycles for our services. The extent to which the COVID-19 pandemic will continue to impact our sales cycle will depend on numerous evolving factors which we may not be able to accurately predict, including: the duration and scope of the pandemic; the effect on our potential and existing clients and client demand for our services and solutions and the speed and efficiency with which they can engage with our teams during the sales cycle and implementation processes; our ability to sell and provide our services and solutions; the ability of our clients to pay for our services and solutions; and any further closures of our and our clients' offices and facilities.

Our growth prospects are dependent upon attracting and retaining enough qualified team members to support our operations, as competition for highly skilled personnel is intense, and failure to do so may result in an adverse impact on our business and financial results.

        Our business is highly competitive and labor-intensive. Our growth prospects, success and ability to meet our clients' expectations and our growth objectives depends on our ability to recruit and retain team members with the right technical skills and/or language capabilities at competitive cost levels. We need to continuously attract and seek new talent, and there is significant competition for professionals with skills necessary to perform the services we offer to our clients. In addition, in some of the geographies we operate there may be a limited pool of potential professionals with the skills we seek. The increased competition for these professionals increases our costs to recruit and retain team members and presents challenges for us in finding team members for our client programs. In particular, we depend on attracting and retaining key sales and account management talent. If we are unable to attract and retain key sales and account management talent, it may reduce our ability to gain new business and maintain existing client relationships.

        Additionally, our failure to provide innovative benefits to our team members could decrease our competitiveness as an employer and adversely impact our ability to attract and retain a skilled workforce. To attract and retain highly skilled team members, we have had to offer, and believe we will

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need to continue to offer, differentiated compensation packages, specific to the geography and skill sets of the team members we are seeking to attract and hire. We have also had to incur costs to provide specialized services and amenities to our team members that impact the profitability of our business. We may need to make significant investments to attract and retain new team members and we may not realize sufficient returns on these investments. An increase in the attrition rate among our team members, particularly among our higher-skilled workforce, would increase our recruiting and training costs and decrease our operating efficiency, productivity and profit margins. From time to time, we have also experienced higher levels of voluntary attrition, and, in those periods, we have been required to expend time and resources to recruit and retain talent, restructure parts of our organization, and train and integrate new team members. If we are not able to effectively attract and retain team members, we may see a decline in our ability to meet our clients' demands, which may impact the demand for our services and we may not be able to innovate or execute quickly on our strategy, and our ability to achieve our strategic objectives will be adversely impacted and our business will be harmed.

        Additionally, evolving technologies, competition and/or client demands may entail high costs associated with retaining and retraining existing team members and/or attracting and training team members with new backgrounds and skills. Changing team member demographics, organizational changes, inadequate organizational structure and staffing, inadequate team member communication, changes in the effectiveness of our leadership, a lack of available career and development opportunities, changes in compensation and benefits, the unavailability of appropriate work processes and tools, client reductions and operational efficiency initiatives may also negatively affect team member morale and engagement, harm our ability to retain acquired talent from our acquisitions, increase team member turnover, increase the cost of talent acquisition and negatively impact service delivery and the customer experience. If we are unable to attract and retain sufficient numbers of highly skilled professionals, our ability to effectively lead our current projects and develop new business could be jeopardized, and our business, financial performance, financial condition and cash flows could be materially adversely affected.

The inelasticity of our labor costs relative to short-term movements in client demand could adversely affect our business, financial condition and financial performance.

        Our business depends on maintaining large numbers of team members to service our clients' business needs and on being able to quickly respond to new client programs or new programs for existing clients. As a result, and consistent with our caring culture, we try where possible not to terminate team members in response to temporary declines in demand when existing projects end or when clients terminate services. Moreover, rehiring and retraining team members at a later date could force us to incur additional expenses and we may not be able to do so in a timely manner. Additionally, any termination of our team members could also have a negative impact on our hiring and recruitment efforts and the morale of the remaining team members and could involve the incurrence of significant additional costs in the form of severance payments to comply with labor regulations in the various jurisdictions in which we operate, all of which would have an adverse impact on our operating profit margins. Furthermore, we are subject to a variety of legal requirements related to the termination of team members in the countries and cities where we operate. These factors limit our ability to adjust our labor costs for unexpected changes in client demand, which could have a material adverse effect on our business, financial condition and financial performance, particularly if demand for our services fails to meet the levels we anticipate. See "—Our growth prospects are dependent upon attracting and retaining enough qualified team members to support our operations, as competition for highly skilled personnel is intense, and failure to do so may result in an adverse impact on our business and financial results".

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Team member wage increases in certain geographies may prevent us from sustaining our competitive advantage and may reduce our profit margin.

        Our most significant costs are the salaries and related benefits of our team members. For example, wage costs in India, the Philippines, Romania and Ireland have historically been significantly lower than wage costs in the United States, Canada and Europe for comparably skilled professionals, which has been one of our competitive advantages. As economic growth increases in the countries where we benefit from lower wage costs, concurrent with increased demand by us and our competitors for skilled employees, wages for comparably skilled employees are increasing at a faster rate than in the United States, Canada and Europe, which may, over time, reduce this competitive advantage. In connection with potential future growth, we may need to increase the levels of team member compensation more rapidly than in the past to remain competitive in attracting and retaining the quality and number of team members that our business requires. As the scale of our analytics services increases, wages as a percentage of revenues will likely increase as wages are generally higher for team members performing analytics services than for team members performing digital customer experience services. To the extent that we are not able to control or share wage increases with our clients, wage increases may reduce our margins and cash flows. We may not be successful in our attempts to control such costs.

Our policies, procedures and programs to safeguard the health, safety and security of our team members and others may not be adequate.

        As at September 30, 2020, we have almost 50,000 team members working in over 20 countries. We have undertaken to implement what we believe to be the best practices to safeguard the health, safety and security of our team members, independent contractors, clients and others at our worksites. If these policies, procedures and programs are not adequate, or team members do not receive related adequate training or do not follow these policies, procedures and programs for any reason, the consequences may be harmful to us, which could impair our operations and cause us to incur significant legal liability or fines as well as reputational damage and negatively impact the engagement of our team members. Our insurance may not cover, or may be insufficient to cover, any legal liability or fines that we incur for health, safety or security incidents.

Our senior management team is critical to our continued success and the loss of one or more members of our senior management team could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        Our future success substantially depends on the continued services and performance of the members of our senior management team, and key team members possessing technical and business capabilities, including industry expertise, that are difficult to replace. Specifically, the loss of the services of our executive leadership team, and in particular, Jeffrey Puritt, our Chief Executive Officer, could seriously impair our ability to continue to manage and expand our business. There is intense competition for experienced senior management and personnel with technical and industry expertise in the industry in which we operate, and we may not be able to retain these officers or key team members. Although we have entered into employment and non-competition agreements with all of our executive officers, certain terms of those agreements may not be enforceable and, in any event, these agreements do not ensure the continued service of these executive officers.

        In addition, we currently do not maintain "key person" insurance covering any member of our management team. The loss of any of our key team members, particularly to competitors, could have a material adverse effect on our business, financial performance, financial condition and cash flows.

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If more stringent labor laws become applicable to us, if we are subject to more employment-related litigation, or if more of our team members unionize, or if our team members strike or cause other labor-related disruptions, our business and financial results may be adversely affected.

        Some of the geographies where we operate have stringent employee-friendly labor legislation, including legislation that sets forth detailed procedures for dispute resolution and employee separations that impose financial obligations on employers. Therefore, in some countries, it may be difficult for us to maintain flexible human resource policies and discharge team members when there is a business need, and our compensation and/or legal expenses may increase significantly. Additionally, in certain of the states and regions in which we operate, we are subject to stringent wage and hour requirements, which has exposed us to claims brought by individual team members and team member groups. Although these claims are not individually or in the aggregate material, we expect to be subject to more such claims in the future.

        In addition, some of our team members, including those of Lionbridge AI in certain regions have formed unions and works councils and others may choose to do so in the future. In certain regions, our employees and those of Lionbridge AI are subject to collective bargaining agreements. In certain countries, we are subject to laws that could require us to establish a co-determined supervisory board which could subject us to significant additional administrative requirements. As a result, we may be required to raise wage levels or grant other benefits that could result in an increase in our compensation expenses or lack of flexibility, or take on increased costs to address administrative requirements, in which case our financial performance and cash flows may be materially and adversely affected.

        Furthermore, strikes by, or labor disputes with, our team members at our delivery locations and independent contractors of Lionbridge AI may adversely affect our ability to conduct business. Work interruptions or stoppages could have a material adverse effect on our business, financial performance, financial condition and cash flows.

We are vulnerable to natural disasters, technical disruptions, pandemics, accidents and other events impacting our facilities that could severely disrupt the normal operation of our business and adversely affect our business, financial performance, financial condition and cash flows.

        Our delivery locations and our data and voice communications, including in Central America, India, Ireland and the Philippines, in particular, may be damaged or disrupted as a result of natural disasters or extreme weather events, including those resulting from or exacerbated by climate change, such as earthquakes, floods, volcano eruptions, heavy rains, winter storms, tsunamis and cyclones; epidemics or pandemics, including the COVID-19 pandemic; technical disruptions and infrastructure breakdowns including damage to, or interruption of, electrical grids, transportation systems, communication systems or telecommunication cables; issues with information technology systems and networks, including computer glitches, software vulnerabilities and electronic viruses or other malicious code; accidents and other events such as fires, floods, failures of fire suppression and detection, heating, ventilation or air conditioning systems or other events, such as protests, riots, labor unrest, security threats and terrorist attacks. Any of these events may lead to the disruption of information systems and telecommunication services for sustained periods and may create delays and inefficiencies in providing services to clients and potentially result in closure of our sites. They also may make it difficult or impossible for team members to reach or work in our business locations. Some locations may not be well-suited to work-from-home approaches to providing client services due to connectivity, infrastructure or other issues. Damage or destruction that interrupts our provision of services could adversely affect our reputation, our relationships with our clients, our leadership team's ability to administer and supervise our business or may cause us to incur substantial additional expenditures to repair or replace damaged equipment or sites. We also may be liable to our clients for disruption in service resulting from such damage or destruction. Our resiliency and disaster recovery plans may not

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be adequate to provide continuity and reliability of service during disruptions or reduce the duration and impact of service outages sufficiently or at all. While we currently have commercial liability insurance, our insurance coverage may be insufficient or may not provide coverage at all for certain events. Furthermore, we may be unable to secure such insurance coverage at premiums acceptable to us in the future, or such insurance may become unavailable. Prolonged disruption of our services could also entitle our clients to terminate their contracts with us or require us to pay penalties or damages to our clients. Any of the above factors may materially adversely affect our business, financial performance, financial condition and cash flows.

We may choose to expand our operations to additional countries, which carries significant risks, and we may not be successful in maintaining our current profit margins in, or repatriating cash from, our new locations due to factors beyond our control.

        We have offices and operations in various countries around the world and provide services to clients globally. An important component of our growth strategy is our continuing international expansion, which depends in part on the availability of the resources we require in order to conduct business in new markets. We continuously evaluate additional locations outside of our current operating geographies in which to invest in delivery locations, in order to maintain an appropriate cost structure for our client programs. We cannot predict the availability of qualified workers, monetary and economic conditions or the existence or extent of government support in other countries. Additionally, we may expand into less developed countries that have less political, social or economic stability and more vulnerable infrastructure and legal systems. Although some of these factors will influence our decision to establish operations in another country, there are inherent risks beyond our knowledge and control, including exposure to currency fluctuations, political and economic instability, unexpected changes in regulatory regimes, foreign exchange restrictions and foreign regulatory restrictions. We may also face difficulties integrating new facilities in different countries into our existing operations. One or more of these factors, or other factors relating to expanded international operations, could affect our ability to repatriate cash, result in increased operating expenses and make it more difficult for us to manage our costs and operations, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

Our business may not develop in ways that we currently anticipate and demand for our services may be reduced due to negative reaction to offshore / nearshore outsourcing or automation from the public.

        We developed our strategy for future growth based on certain assumptions regarding our industry, future demand in the market for our services and the manner in which we would provide these services, including the assumption that a significant portion of the services we offer will continue to be delivered through offshore / nearshore facilities. The trend of transitioning key business processes to offshore / nearshore third parties may not continue and could reverse. In addition, we cannot accurately predict the impact that the COVID-19 pandemic might have on our clients' outsourcing demands and efforts, which might be lower in the future, as some of our clients might decide to refrain from offshore / nearshore outsourcing due to the pressures they face from increased domestic unemployment resulting from the COVID-19 pandemic.

        The issue of domestic companies outsourcing services to organizations operating in other countries is a topic of political discussion in the United States, as well as in Europe, countries in the Asia-Pacific region and other regions where we have clients. Some countries and special interest groups have expressed a perspective that associates offshore outsourcing with the loss of jobs in a domestic economy. This has resulted in increased political and media attention, especially in the United States, where the subject of outsourcing has been a focus of the current presidential administration. It is possible that there could be a change in the existing laws that would restrict or require disclosure of offshore outsourcing or impose new standards that have the effect of restricting the use of certain visas

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in the foreign outsourcing context. The measures that have been enacted to date are generally directed at restricting the ability of government agencies to outsource work to offshore business service providers. These measures have not had a significant effect on our business because governmental agencies are not currently a focus of our operations. Some legislative proposals, however, would, for example, require delivery locations to disclose their geographic locations, require notice to individuals whose personal information is disclosed to non-U.S. affiliates or subcontractors, require disclosures of companies' foreign outsourcing practices, or restrict U.S. private sector companies that have federal government contracts, federal grants or guaranteed loan programs from outsourcing their services to offshore service providers. In addition, changes in laws and regulations concerning the transfer of personal information to other jurisdictions could limit our ability to engage in work that requires us to transfer data in one jurisdiction to another. Potential changes in tax laws may also increase the overall costs of outsourcing or affect the balance of offshore and onshore business services. Such changes could have an adverse impact on the economics of outsourcing for private companies in the United States, which could, in turn, have an adverse impact on our business with U.S. clients.

        Similar concerns have also led certain European Union jurisdictions to enact regulations which allow team members who are dismissed as a result of transfer of services, which may include outsourcing to non-European Union companies, to seek compensation either from the company from which they were dismissed or from the company to which the work was transferred. This could discourage European Union companies from outsourcing work offshore and/or could result in increased operating costs for us. In addition, there has been publicity about the negative experiences, such as theft and misappropriation of sensitive customer data of various companies that use offshore outsourcing.

        Additionally, we may face negative public reaction to increased automation of or reduction in employment positions through the use of artificial intelligence or the other technologies we use to provide our services, which could reduce the demand for many of our digital service offerings. Increased negative public perception by public and private companies and related legislative efforts in economies around the world could have adverse impact on the demand for our services.

Terrorist attacks and other acts of violence, including those involving any of the countries in which we or our clients have operations, could lead to or exacerbate an economic recession and pose significant risks to our team members and facilities.

        Terrorist attacks and other acts of violence or war may adversely affect worldwide financial markets and could potentially lead to, or exacerbate, an economic recession, which could adversely affect our business, financial performance, financial condition and cash flows. These events could adversely affect our clients' levels of business activity and precipitate sudden significant changes in regional and global economic conditions and cycles. These events also pose significant risks to our team members and to our delivery locations and operations around the world. We generally do not have insurance for losses and interruptions caused by terrorist attacks, military conflicts and wars. Any such event could have a material adverse effect on our business, financial performance, financial condition and cash flows.

If we are not able to manage our resource utilization levels or price our services appropriately, our business, financial performance, financial condition and cash flows may be adversely affected.

        Our profitability is largely a function of the efficiency with which we use our resources, particularly our team members and our delivery locations and the pricing that we are able to obtain for our services. Our resource utilization levels are affected by a number of factors, including our ability to attract, train, and retain team members, transition team members from completed projects to new assignments, forecast demand for our services (including potential client reductions in required resources or terminations) and maintain an appropriate number of team members in each of our delivery locations, as well as our need to dedicate resources to team member training and development.

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The prices we are able to charge for our services are affected by a number of factors, including price competition, our ability to accurately estimate revenues from client engagements, our ability to estimate resources and other costs for long-term pricing, margins and cash flows for long-term contracts, our clients' perceptions of our ability to add value through our services, introduction of new services or products by us or our competitors, and general economic and political conditions. Therefore, if we are unable to appropriately price our services or manage our resource utilization levels, there could be a material adverse effect on our business, financial performance, financial condition and cash flows.

Our operating results may experience significant variability and, as a result, it may be difficult for us to make accurate financial forecasts and our actual operating results may experience variability, including falling short of our forecasts.

        Our growth has not been, and in the future is not expected to be, linear as our period-to-period results have been in the past and may, in the future, fluctuate due to certain factors, including client demand, a long selling cycle, delays or failures by our clients to provide anticipated business, losses or wins of key clients, variations in team member utilization rates resulting from changes in our clients' operations, delays or difficulties in expanding our delivery locations and infrastructure (including hiring new team members or constructing new delivery locations), capital investment amounts that may be inappropriate if our financial forecasts are inaccurate, changes to our pricing structure or that of our competitors, currency fluctuations, seasonal changes in the operations of our clients, our ability to recruit team members with the right skillset, failure to meet service delivery requirements as a result of technological disruptions, the timing of acquisitions and other events identified in this prospectus, all of which may significantly impact our results and the accuracy of our forecasts from period to period. For example, the volume of business with some of our clients in our Travel and Hospitality vertical is significantly affected by seasonality, with our revenue typically higher in the third and fourth quarters due to spending patterns of our clients with calendar fiscal years.

        Our revenues are also affected by changes in pricing under our contracts at the time of renewal or by pricing under new contracts. In addition, while we seek to forecast the revenue we expect to receive with a client when we enter into a contract, most of our contracts do not commit our clients to provide us with a specific volume of business over a specific period and, therefore, the associated revenue from such a contract could decline, and such forecasts may not prove to be correct. See "—If we are unable to accurately forecast our pricing models or optimize the mix of products and services we provide to meet changing client demands, or if we are unable to adapt to changing pricing and procurement demands of our clients, our business, financial performance, financial condition and cash flows may be adversely affected". We are experiencing declines in revenues related to service programs we have with, for example, clients in our Travel and Hospitality vertical due to the COVID-19 pandemic. In addition, our clients are generally able to delay or postpone services for which we have been contracted to provide and, in many cases, terminate existing service contracts with us with limited notice, all of which could adversely impact revenue we expect to generate in any period. The selling cycle for our services and the budget and approval processes of prospective clients make it difficult to predict the timing of for the services we provide to our clients, entering into definitive agreements with new clients. The completion of implementation varies significantly based upon the complexity of the processes being implemented.

        As a result, it may be difficult for us to accurately make financial forecasts and our actual operating results may experience variability, including falling short of our forecasts.

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Our inability to manage our rapid growth effectively could have an adverse effect on our business and financial results.

        Since we were founded in 2005, we have experienced rapid growth and significantly expanded our operations. We have delivery locations in over 20 countries. The number of our team members has increased significantly over the past several years. We expect to develop and improve our internal systems in the locations where we operate in order to address the anticipated continued growth of our business. We are also continuing to look for delivery locations outside of our current operating geographies to decrease the risks of operating from a limited number of countries. We may not, however, be able to effectively manage our infrastructure and team member expansion, open additional delivery locations or hire additional skilled team members as and when they are required to meet the ongoing needs of our clients and to meet our current growth trajectory, and we may not be able to develop and improve our internal systems. We also need to manage cultural differences between our team member populations and that may increase the risk for employment law claims. Our inability to execute our growth strategy, to ensure the continued adequacy of our current systems or to manage our expansion, capital and other resources effectively could have a material adverse effect on our business, financial performance, financial condition and cash flows.

Our business and financial results have been, and in the future may be, adversely impacted by the COVID-19 pandemic.

        The global outbreak of COVID-19 continues to evolve. The COVID-19 pandemic has spread to nearly all countries around the world, including each of the countries where our delivery locations are located, and has created significant uncertainty and disruption. Governmental measures and regulations, such as city or country-wide lockdowns, local, domestic and international travel restrictions as well as closures of the enabling infrastructure necessary for our business to operate smoothly, have resulted, and may in the future result, in restrictions on our ability to fully deliver services to our clients. Such measures present concerns that may dramatically affect our ability to conduct our business effectively, including, but not limited to, adverse effects on our team members' health, a slowdown and often a stoppage of delivery, work, travel and other activities which are critical for maintaining on-going business activities. Our ability to continue operations effectively during the COVID-19 pandemic is dependent on a number of factors, such as the continued availability of high-quality internet bandwidth, an uninterrupted supply of electricity, the sustainability of social infrastructure to enable our team members who are working remotely to continue delivering services, and on otherwise adequate conditions for remote-working, all of which are outside of our control. For example, some of the geographies in which our team members work remotely may not be well-suited to work-from-home approaches to providing client services due to connectivity or other issues with the local infrastructure. The effects of the pandemic have caused our clients to defer decision making, delay planned work, reduce volumes or seek to terminate current agreements with us. Additionally, a number of our clients in our Travel and Hospitality vertical have been and may, in the future, be negatively impacted as a result of the pandemic and the corresponding reduction in demand for their services may negatively affect the revenue we will be generating from those clients. As a result of the COVID-19 pandemic, we have had to temporarily close a number of our sites in accordance with government ordinances applicable in the various jurisdictions in which we operate. Closures of sites for such extended periods of time may impact our ability to retain and attract talent, which may have negative impacts on our human resources costs and our profitability.

        Given the uncertainty around the severity and duration of the impact of the COVID-19 pandemic on our clients' businesses and the countries and communities in which we operate, including the possible resurgence of infection rates, spread to communities previously not significantly affected and the changes in the mitigation and protective measures used to combat COVID-19, we cannot

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reasonably estimate its impact on our future business, financial performance, financial condition and cash flows.

        Following guidance from local public health authorities in the countries in which we operate, we have taken various measures to help reduce the spread of the virus and maintain the health and safety of our workforce, including, but not limited to, implementing remote-working arrangements and restricting access to sites and implementing other measures to help maintain the safety of our workforce, which allows us to carry out operations. We have currently enabled approximately 95% of our team members to work from home. For team members who continue to work on TELUS International premises, we have introduced comprehensive safety practices, including, but not limited to, distributing masks and sanitizers, hourly site sanitization in high-traffic areas, thermal screening and daily health questionnaires, discontinued multiple use of workstations and equipment and imposed restrictions on access and movement within our sites to enhance social distancing. The effects of these policies may negatively impact productivity and the magnitude of any effect will depend, in part, on the length and severity of the restrictions and other limitations and on how such measures will affect our ability to conduct our business in the ordinary course. Some of these measures have required us to provide services and operate client processes in a remote environment that is not directly supervised, and while this has been acknowledged by our clients, such alternative operating models may affect the quality of service we are able to provide to our clients. Evolving interpretations of compliance and audit requirements may alter our profitability for clients that utilize flexible work models from home or remote environments. See "—The unauthorized disclosure of sensitive or confidential client and customer data could expose us to protracted and costly litigation, damage our reputation and cause us to lose clients".

        International and domestic travel bans imposed as emergency measures by governments, our reduced ability to hire new team members, disruptions to our supply chain, lockdowns in geographies where clients are located and temporary closures of our delivery locations have impaired, and may continue to impair our ability to generate new business or expand our relationships with existing clients and, hence, may have a negative impact on our growth, financial condition, results and the future price of our shares. Further, although we have not experienced significant issues with our managerial and financial reporting to date as a result of a restriction on travel or otherwise, in the future we may suffer delays in managerial and financial reporting, be unable to perform audits and apply effective internal controls over financial reporting, or fail to abide by other regulatory or compliance requirements to which we are subject as a result of the effects of the COVID-19 pandemic.

        The increase in remote working may also result in client privacy, IT security and fraud concerns as well as increase our exposure to potential wage and hour issues. An at-home workforce introduces increased risks to satisfying our contractual obligations and maintaining the security and privacy of the data we process. In addition, as a result of the acquisition of Lionbridge AI, we have become subject to the client privacy, IT security and fraud concerns associated with a workforce largely composed of independent contractors who use and rely on their own equipment.

        To the extent the COVID-19 pandemic adversely affects our business, financial condition, financial performance and cash flows, it may also have the effect of heightening many of the other risks described in this "Risk Factors" section.

We rely on computer hardware, purchased or leased, and software licensed from and services rendered by third parties in order to provide our solutions and run our business and any loss of the right to use, disruption of supply of, or failures of third-party hardware, software or services could have an adverse effect on our business, financial performance, financial condition and cash flows.

        We rely on computer hardware, purchased or leased, and software licensed from, and services rendered by, third parties in order to provide our solutions and run our business, other than the

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independent contractors in our data annotation business who generally use their own equipment. Third-party hardware, software and services may not continue to be available on commercially reasonable terms, or at all. Licenses for such third-party technologies may be terminated or not renewed, and we may be unable to license such third-party technologies in the future. Any loss of the right to use or any failures of third-party hardware, software or services could result in delays in our ability to provide our solutions or run our business until equivalent hardware, software or services are developed by us or, if available, identified, obtained and integrated, which could be costly and time-consuming and may not result in an equivalent solution, any of which could have an adverse effect on our business, financial performance, financial condition and cash flows.

        We also rely on third-party suppliers to provide equipment and components necessary for our operations. Reliance on such third-party suppliers reduces our control over delivery schedules and quality of equipment and our international third-party suppliers may be subject to adverse economic conditions, all of which may ultimately impact our operations and our ability to effectively deliver services to our clients.

        Further, clients could assert claims against us in connection with service disruption and/or cease conducting business with us altogether as a result of problems with the hardware we use to deliver services. Even if not successful, a claim brought against us by any of our clients would likely be time-consuming and costly to defend and could seriously damage our reputation and brand, making it harder for us to sell our solutions, any of which could have an adverse effect on our business, financial performance, financial condition and cash flows.

We rely upon third-party providers of "cloud" computing services to operate certain aspects of our services and any disruption of or interference with our use of these cloud providers or increase in cost of their services could adversely impact our business, financial performance, financial condition and cash flows.

        We rely on a limited number of cloud computing providers for a distributed computing infrastructure platform for our business operations, or what is commonly referred to as a "cloud" computing service. We have architected our software and computer systems so as to utilize data processing, storage capabilities and other services provided by these providers. Degradation or disruption of, interference with, or loss of our use of such cloud services may adversely impact our provision of services, and consequently, such events may adversely affect our revenues, reputation, our relationships with our clients, our leadership team's ability to administer and supervise our business or may cause us to incur substantial additional expenditure to repair or replace damaged equipment or sites. We may also be liable to our clients for such disruptions in services. Prolonged disruption of our services could also entitle our clients to terminate their contracts with us or require us to pay penalties or damages to our clients. As a result of our reliance on these providers, including the complexity that a switch from one cloud provider to another would involve, increases in costs for these services may significantly increase our costs of operations. Additionally, certain of these vendors provide services to us pursuant so such vendors' contracts with TELUS, and as a result, such services may be subject to interruptions due to factors beyond our control, or may be renegotiated from time to time without our participation on terms we cannot control. Any disruption of or interference with our use of these cloud providers or material changes in the price for such services would adversely impact our operations and our business, financial performance, financial condition and cash flows may be adversely impacted.

We or our vendors may disrupt our clients' operations as a result of telecommunications or technology downtime or interruptions, which would have a negative impact on our revenues or reputation and cause us to lose clients.

        Our dependence on our offshore / nearshore delivery locations to deliver services requires us to maintain active voice and data communications and transmission among our delivery locations, our international technology hubs and our clients' offices. Although we maintain redundant facilities and

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communications links and have business continuity plans in place, disruptions could result from, among other things, technical breakdowns, faulty systems or software, computer glitches, viruses and other malicious software, weather conditions, global pandemics and geopolitical instability. Further, our business continuity plans may not be entirely successful in mitigating the effects of such events. A prolonged interruption, or frequent or persistent interruptions, in the availability of our services could disrupt our clients' operations and materially harm our reputation and business, especially if we are not able to rapidly transition to an alternative service delivery model using a different delivery location or a different client service team. We also depend on certain significant vendors for facility storage and related maintenance of our main technology equipment and data at those technology hubs, as well as for some of the third-party technology and platforms we sometimes use to deliver our services. Any failure by these vendors to perform those services, any temporary or permanent loss of our equipment or systems, or any disruptions to basic infrastructure like power and telecommunications could impede our ability to provide services to our clients, have a negative impact on our revenues or reputation and cause us to lose clients, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

We may be unable to successfully identify, complete, integrate and realize the benefits of acquisitions or manage the associated risks, all of which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        A key part of our business strategy is to continue to selectively consider acquisitions or investments, some of which may be material. Through the acquisitions we pursue, we may seek opportunities to expand the scope of our existing services, add new clients or enter new geographic markets. There can be no assurance that we will successfully identify suitable candidates in the future for strategic transactions at acceptable prices or at all, have sufficient capital resources to finance potential acquisitions or be able to consummate any desired transactions. Our failure to complete potential acquisitions in which we have invested or may invest significant time and resources could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        Acquisitions, including completed acquisitions, involve a number of risks, including diversion of management's attention from operating our business, developing our relationships with key clients and seeking new revenue opportunities, failure to retain key personnel of acquired companies, legal risks and liabilities relating to the acquisition or the acquired entity's historic operations which may be unknown or undisclosed and for which we may not be indemnified fully or at all, failure to integrate the acquisition in a timely manner, and, in the case of our potential acquisitions, our ability to finance the acquisitions on attractive terms or at all, any of which could have a material adverse effect on our business, financial performance, financial condition and cash flows. Future acquisitions may also result in the incurrence of indebtedness or the issuance of additional equity securities.

        We could also experience financial or other setbacks if transactions encounter unanticipated problems, including problems related to execution, integration or underperformance relative to prior expectations. Post-acquisition activities include the review and alignment of employee cultures, accounting policies, treasury policies, corporate policies such as ethics and privacy policies, employee transfers and moves, information systems integration, optimization of service offerings and the establishment of control over new operations. Such activities may not be conducted efficiently and effectively. Our management may not be able to successfully integrate any future acquired business into our operations and culture on our anticipated timeline or at all, or maintain our standards, controls and policies, which could negatively impact the experience of our clients, optimization of our service offerings and control over operations and otherwise have a material adverse effect on our business, financial performance, financial condition and cash flows. Consequently, any acquisition we complete may not result in anticipated or long-term benefits or synergies to us or we may not be able to further develop the acquired business in the manner we anticipated.

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        Following the completion of acquisitions, we may be required to rely on the seller to provide administrative and other support, including financial reporting and internal controls over financial reporting, and other transition services to the acquired business for a period of time. We may not have experience in working with the sellers of the business we have acquired to obtain the necessary support to operate a newly acquired business. There can be no assurance that the seller will do so in a manner that is acceptable to us.

We may need to raise additional funds to pursue our growth strategy or continue our operations, and we may be unable to raise capital when needed or on acceptable terms, which could lead us to be unable to expand our business.

        From time to time, we may seek additional financing to fund our growth, enhance our technology, respond to competitive pressures or make acquisitions or other investments. We cannot predict the timing or amount of any such capital requirements at this time. General economic, financial or political conditions in our markets may deteriorate or other circumstances may arise, which, in each case, may have a material adverse effect on our cash flows and our business, leading us to seek additional capital. We may be unable to obtain financing on satisfactory terms, or at all. In this case, we may be unable to expand our business at the rate desired, or at all, and our financial performance may suffer. Financing through issuances of equity securities would be dilutive to holders of our shares.

If we are unable to collect our receivables from, or bill our unbilled services to, our clients, our financial performance, financial condition and cash flows could be adversely affected.

        Our business depends on our ability to successfully obtain payment from our clients for work performed and to bill and collect on what are usually relatively short cycles. We evaluate the financial condition of our clients and maintain allowances against receivables. We might not accurately assess the creditworthiness of our clients. Actual losses on client balances could differ from those that we currently anticipate and, as a result, we might need to adjust our allowances. Macroeconomic conditions, such as any domestic or global credit crisis or disruption of the global financial system, including as a result of the COVID-19 pandemic, could also result in financial difficulties for our clients, up to and including insolvency or bankruptcy, as well as limit their access to the credit markets and, as a result, could cause clients to delay payments to us, request modifications to their payment arrangements that could increase our receivables balance, or default on their payment obligations to us. We have had clients in the past who have entered into insolvency proceedings and have defaulted on their obligations to us. Timely collection of client balances also depends on our ability to complete our contractual commitments, including delivering on the service level our clients expect, and bill and collect our contracted revenues. If our client is not satisfied with our services or we are otherwise unable to meet our contractual requirements, we might experience delays in the collection of and/or be unable to collect our client balances, and if this occurs, our financial performance, financial condition and cash flows could be adversely affected. In addition, if we experience an increase in the time to bill and collect for our services, our cash flows could be adversely affected.

As a result of becoming a public company in the United States, we will become subject to additional regulatory compliance requirements, including Section 404 of the Sarbanes-Oxley Act. We have identified a material weakness in our internal control over financial reporting.

        As a foreign private issuer listed on the NYSE, we will incur legal, accounting and other expenses that we did not previously incur. We will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act, the NYSE listing requirements and other applicable securities rules and regulations, as well as the Foreign Corrupt Practices Act. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time consuming or costly and increase demand on our systems and resources. The Exchange

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Act requires that, as a public company, we file or furnish annual and certain other reports with respect to our business, financial condition and result of operations.

        Effective internal control over financial reporting is necessary for us to provide reliable financial reports. Effective internal controls, together with adequate disclosure controls and procedures, are designed to prevent or detect material misstatement due to fraud or error and to provide reasonable assurance as to the reliability of financial reporting. Deficiencies in our internal controls may adversely affect our management's ability to record, process, summarize, and report financial data on a timely basis. As a public company, we will be required by Section 404 of the Sarbanes-Oxley Act and applicable Canadian securities laws, including National Instrument 52-109—Certification of Disclosure in Issuers' Annual and Interim Filings, to include a report of management's assessment on our internal control over financial reporting and, beginning with our annual report for the year ending December 31, 2021, an independent auditor's attestation report on our internal control over financial reporting in our annual reports on Form 20-F or Form 40-F, subject to certain exceptions. Compliance with Section 404 will significantly increase our compliance costs and management's attention may be diverted from other business concerns, which could adversely affect our financial performance. We may need to hire more team members in the future or engage outside consultants to comply with these requirements, which would further increase expenses. If we fail to comply with the applicable requirements of the Sarbanes-Oxley Act in the required timeframe, we may be subject to sanctions, investigations or other enforcement actions by regulatory authorities, including the SEC and the .

        Prior to this offering, similar to other private companies, neither we nor our independent registered public accounting firm were required to deliver an opinion on the effectiveness of our internal control over financial reporting. Our independent registered public accounting firm's audit for the years ended December 31, 2017, 2018 and 2019, included assessments of internal control over financial reporting as a basis for designing their audit procedures, but not for the purpose of expressing an opinion on the effectiveness of our internal control over financial reporting. We have identified material weaknesses in our internal control over financial reporting as at December 31, 2019. A "material weakness" is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement in our financial statements will not be prevented or detected on a timely basis. Specifically, the material weaknesses relate to the ineffective design of controls relating to the review and approval of revenue recognition and journal entries at our less significant subsidiaries and the related ineffective design of risk assessment procedures, deployment of control activities, and monitoring of internal control over financial reporting at these subsidiaries. We have taken steps to address these material weaknesses and continue to implement our remediation plan. The implementation of our remediation plan may be time consuming and may place significant demands on our financial and operational resources. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Internal Control—Financial Reporting". We cannot assure you, however, that these remediation measures will fully address the material weaknesses in our internal control over financial reporting or that we will conclude that the material weaknesses have been fully remediated. Additionally, we cannot assure you that we will not identify a material weakness or significant deficiency in the future. If we fail to maintain an effective system of internal control over financial reporting in the future, we may not be able to accurately and timely report on our operating results or financial condition, which could adversely affect investor confidence in our company and the market price of our subordinate voting shares.

We may not be able to realize the entire book value of goodwill and other intangible assets from acquisitions.

        We anticipate recording a significant amount of goodwill and intangible assets in connection with our acquisition strategy. For example, the acquisitions of CCC and Lionbridge AI have increased our goodwill and intangible assets balances significantly. Our carrying value of goodwill and intangible

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assets is periodically tested for impairment on an annual basis. We assess our goodwill and intangible assets by comparing the recoverable amounts of our cash generating unit to its carrying value. To the extent that the carrying value exceeds its recoverable amount, the excess amount would be recorded as a reduction in the carrying value of the asset and any remainder would be recorded as a reduction in the carrying value of the assets on a pro-rated basis. In the event that the carrying amount of goodwill or the intangible assets are impaired, any such impairment would be charged to earnings in the period of impairment. Since this involves the use of critical accounting policies and estimates, we cannot assure that future impairment of goodwill or intangible assets will not have a material adverse effect on our financial performance.

We may incur liabilities for which we are not insured, and may suffer reputational damage in connection with certain claims against us.

        We could be sued directly for claims that could be significant, such as claims related to breaches of privacy or network security, infringement of intellectual property rights, violation of wage and hour laws, or systemic discrimination, and our contracts may not fully limit or insulate us from those liabilities. Additionally, in our contracts with our clients, we indemnify our clients for losses they may incur for our failure to deliver services pursuant to the terms of service set forth in such service contracts, and a limited number of our service contracts provide for high or unlimited liability for the benefit of our clients related to damages resulting from breaches of privacy or data security in connection with the provision of our services. Although we have various insurance coverage plans in place, including coverage for general liability, errors or omissions, property damage or loss and information security and privacy liability, that coverage may not continue to be available on reasonable terms or in sufficient amounts to cover one or more claims. The policies may also have exclusions which would limit our ability to recover under them, the limits under the policy may be insufficient, or our insurers may deny coverage following their investigation of a claim. Currently we do not have insurance in place for certain types of claims, such as patent infringement, violation of wage and hour laws, failure to provide equal pay in the United States and our indemnification obligations to our clients based on employment law, because it is either not available or is not economically feasible. The successful assertion of one or more large claims against us that are excluded from our insurance coverage or exceed available insurance coverage, or changes in our insurance policies (including premium increases, the imposition of large deductible or co-insurance requirements, changes in terms and conditions or outright cancellation or non-renewal of coverage), could have a material adverse effect on our business, financial performance, financial condition and cash flows. Furthermore, the assertion of such claims, whether or not successful, could cause us to incur reputational damage, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

We may not be able to comply with the covenants in our credit agreement, service our debt or obtain additional financing on competitive terms, which could result in a default of our credit agreement.

        Our credit agreement contains various restrictive covenants. Our ability to comply with the restrictive covenants in our credit agreement, including the net debt to EBITDA ratio covenant will depend upon our future performance and various other factors, including but not limited to the impacts of the COVID-19 pandemic on our business, financial performance, financial condition and cash flows, any prolonged recessionary economic environment that may develop and competitive factors, many of which are beyond our control. The credit agreement also contains covenants related to our relationship with TELUS, which are not in our control. We may not be able to maintain compliance with all of these covenants. In that event, we may not be able to access the borrowing availability under our credit agreement and we may need to seek an amendment to our credit agreement or may need to refinance our indebtedness. There can be no assurance that we can obtain future amendments of or waivers under our existing and any future credit agreements and instruments, or refinance borrowings under

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our credit agreement, and, even if we were able to obtain an amendment or waiver in the future, such relief may only last for a limited period. Any noncompliance by us with the covenants under our credit agreement could result in an event of default thereunder, which may allow the lenders to accelerate payment of the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies. In the event our creditors accelerate the repayment of our indebtedness, we cannot assure you that we would have sufficient assets to make such repayment.

        Our cash flow from operating activities will provide the primary source of funds for our debt service payments. If our cash flow from operating activities declines, we may not be able to service or refinance our current debt, which could adversely affect our business and financial condition. Our credit facility exposes us to changes in interest rates. We currently hedge a portion of our variable rate interest exposure but such hedging activities may not be successful in mitigating the risk of increasing interest rates, which may increase our debt service payments.

In preparing our financial statements, we make certain assumptions, judgments and estimates that affect amounts reported in our consolidated financial statements, which, if not accurate, may significantly impact our financial results.

        In preparing our financial statements, we make certain assumptions, judgments and estimates that affect amounts reported in our consolidated financial statements, which, if not accurate, may significantly impact our financial results. We make assumptions, judgments and estimates for a number of items, including those listed in the section "Management's Discussion and Analysis of Financial Condition and Results of Operations—Quantitative and Qualitative Disclosures about Market Risk—Critical Accounting Policies and Estimates". These assumptions, judgments and estimates are drawn from historical experience and various other factors that we believe are reasonable under the circumstances as at the date of the consolidated financial statements. Actual results could differ materially from our estimates, and such differences could significantly impact our financial results.

Fluctuations in foreign currency exchange rates could harm our financial performance.

        Our functional currency is the U.S. dollar, but we also generate revenue and incur expenses in other currencies, including the euro, the Philippine peso and the Canadian dollar. As we expand our operations to new countries, our exposure to fluctuations in these currencies may increase and we may incur expenses in other currencies. There may be fluctuations in currency exchange rates between the U.S. dollar and other currencies we transact in which may adversely impact our financial results. In addition, the impact of the COVID-19 pandemic on macroeconomic conditions may impact the proper functioning of financial and capital markets and result in unpredictable fluctuations in foreign currency exchange rates.

        Our financial performance could be adversely affected over time by certain movements in exchange rates, particularly if currencies in which we incur expenses appreciate against the U.S. dollar or if the currencies in which we receive revenues depreciate against the U.S. dollar. Although we take steps to hedge a portion of our foreign currency exposures, there is no assurance that our hedging strategy will be successful or that the hedging markets will have sufficient liquidity or depth for us to implement our strategy in a cost-effective manner. In addition, in some countries such as India and China, we are subject to legal restrictions on hedging activities, as well as convertibility of currencies, which could limit our ability to use cash generated in one country to invest in another and could limit our ability to hedge our exposures. Finally, our hedging policies only provide near term protection from exchange rate fluctuations. If currencies in which we incur expenses appreciate against the U.S. dollar, we may have to consider additional means of maintaining profitability, including by increasing pricing or reducing costs, which may or may not be achievable.

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Our financial condition could be negatively affected if countries reduce or withdraw tax benefits and other incentives currently provided to companies within our industry or if we are no longer eligible for these benefits.

        TELUS International operates in various jurisdictions including Austria, Bosnia and Herzegovina, Bulgaria, Canada, China, El Salvador, France, Germany, Guatemala, India, Ireland, Latvia, the Philippines, Poland, Romania, Slovakia, Spain, Switzerland, Turkey and the United States, which increases our exposures to multiple forms of taxation. Our tax expense and cash tax liability in the future could be adversely affected by various factors, including, but not limited to, changes in tax laws (including tax rates), regulations, accounting principles or interpretations, the potential adverse outcome of tax examinations and international tax complexity and compliance. Changes in the valuation of deferred tax assets and liabilities, which may result from a decline in our profitability or changes in tax rates or legislation, could have a material adverse effect on our tax expense.

        Our subsidiaries file tax returns and pay taxes in the various jurisdictions in which they are a resident and carry on their business activities. Our tax expense and cash tax liability (including interest and penalties) could be adversely affected if a country were to successfully argue that any of our subsidiaries is resident in, or carries on business in, a country that is different from any jurisdiction in which it files its tax returns and pays taxes.

        Certain cross-border payments may be subject to withholding taxes in the jurisdiction of the payer. Our tax expense and cash tax liability (including interest and penalties) could be adversely affected if a country were to successfully argue that any cross-border payments by our subsidiaries are subject to withholding tax in a manner or at a rate that is different from any amounts actually withheld in respect of any applicable withholding taxes. In addition, our tax expense and cash tax liability (including interest and penalties) could be adversely affected if a country were to dispute the quantum and timing of any deduction related to any cross-border payment.

        Certain of our delivery locations in India, which were established in Special Economic Zones ("SEZ"), are eligible for tax incentives until 2024. These delivery locations are eligible for a 100% income tax exemption for the first five years of operation and a 50% exemption for a period of up to ten years thereafter if certain conditions are met. Minimum tax is paid on income subject to the SEZ incentives which generates credits that can be carried forward for 15 years to be applied against taxes payable on regular income. Additionally, there were new delivery locations established during the fiscal year ended March 31, 2019, which are eligible for tax incentives until 2034. While the SEZ incentive program for new facilities was terminated effective March 31, 2020, we anticipate establishing additional delivery locations in existing SEZs in the future that should be eligible for the same incentives.

        As our SEZ legislation benefits are being phased out, our Indian tax expense may materially increase and our after-tax profitability may be materially reduced, unless we can obtain comparable benefits under new legislation or otherwise reduce our tax liability. Minimum taxes imposed on the exempt income may increase our tax expense in future years if the minimum tax credits cannot be fully utilized during the carryover period.

        We also benefit from corporate tax incentives for our Philippine delivery locations. These incentives are administered by the Philippine Economic Zone Authority ("PEZA") and initially provide a four-year tax holiday for each PEZA registered location, followed by a preferential tax rate of 5% of gross profit. The PEZA incentive regime yields an average effective tax rate of less than 10% of pre-tax income with the rate determined by how many of the PEZA registered locations were in the exemption period during the year. The proposed Corporate Recovery and Tax Incentives for Enterprises ("CREATE") Act released in May 2020, contains modifications to existing tax incentive programs with a proposal to increase the 5% tax on gross profit to 10% by 2023. Failure to qualify for favorable tax regimes in the Philippines (including as a result of their repeal) could result in income generated from

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centers in the Philippines being taxed at the prevailing annual tax rate (which is proposed, under CREATE, to be reduced from 30% to 25% effective immediately, and ultimately to 20% by 2027).

        Our operations in El Salvador benefit from a favorable tax exemption. Failure to qualify for the favorable tax regime in El Salvador (including as a result of its repeal) could result in income generated from centers in El Salvador being taxed at the prevailing annual tax rate of 30%.

        Our operations in the United States may be subject to the Base Erosion and Anti-Abuse Tax ("BEAT") starting in 2021. The BEAT operates as a minimum tax (10% for taxable years before 2026 and 12.5% thereafter) and is generally calculated as a percentage of the "modified taxable income" of an "applicable taxpayer". The BEAT applies for a taxable year only to the extent it exceeds a taxpayer's regular corporate income tax liability for such year (determined without regard to certain tax credits). Certain subsidiaries organized in the United States are expected to become "applicable taxpayers" in 2021 so they may incur a BEAT tax liability. In addition, the Internal Revenue Service ("IRS") could disagree with our calculation of the amount of the BEAT tax liability or otherwise assert we owe additional tax. If our subsidiaries in the United States are subject to the BEAT, it could significantly increase their tax liability.

        As a result of the foregoing, our overall effective tax rate may increase in future years and such increase may be material and may have an adverse impact on our business, financial performance, financial condition and cash flows.

If tax authorities were to successfully challenge the transfer pricing of our cross-border intercompany transactions, our tax liability may increase.

        We have cross-border transactions among our subsidiaries in relation to various aspects of our business, including operations, financing, marketing, sales and delivery functions. Canadian transfer pricing regulations, as well as regulations applicable in other countries in which we operate, require that any international transaction involving associated enterprises be on arm's-length terms and conditions. We view the transactions entered into by our subsidiaries to be in accordance with the relevant transfer pricing laws and regulations. If, however, a tax authority in any jurisdiction successfully challenges our position and asserts that the terms and conditions of such transactions are not on arm's length terms and conditions, or that other income of our affiliates should be taxed in that jurisdiction, we may incur increased tax liability, including accrued interest and penalties, which would cause our tax expense to increase, possibly materially, thereby reducing our profitability and cash flows, which in turn could have a material adverse effect on our financial performance, effective tax rate and financial condition.

Tax legislation and the results of actions by taxing authorities may have an adverse effect on our operations and our overall tax rate.

        The Government of Canada or other jurisdictions where we have a presence could enact new tax legislation which could have a material adverse effect on our business, financial performance, financial condition and cash flows. In addition, our ability to repatriate surplus earnings from our delivery locations in a tax-efficient manner is dependent upon interpretations of local laws, possible changes in such laws and the renegotiation of existing bilateral tax treaties. Changes to any of these may adversely affect our overall tax rate, or the cost of our services to our clients, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

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Certain income of our non-Canadian subsidiaries may be taxable in Canada, and if the Canadian tax authorities were to successfully dispute the quantum of such income, our tax expense and tax liability may increase.

        Certain income of our non-Canadian subsidiaries that is passive in nature or that has a particular connection to Canada may be taxable in Canada under the "foreign affiliate property income" ("FAPI") regime in the Income Tax Act (Canada). Our tax expense and cash tax liability (including interest and penalties) could be adversely affected if the Canadian tax authorities were to successfully dispute the quantum of any FAPI earned by our non-Canadian subsidiaries, thereby adversely affecting our business, financial performance, financial condition and cash flows.

We and our clients are subject to laws and regulations globally, which increases the difficulty of compliance and may involve significant costs and risks. Any failure to comply with applicable legal and regulatory requirements could have a material adverse effect on our business, financial performance, financial condition and cash flows.

        The jurisdictions where we operate, as well as our contracts, require us to comply with or facilitate our clients' compliance with numerous, complex and sometimes conflicting legal regimes, both domestically and internationally. These laws and regulations relate to a number of aspects of our business, including anti-corruption, internal and disclosure control obligations, data privacy and protection, wage-and-hour standards, employment and labor relations, trade protections and restrictions, import and export control, tariffs, taxation, sanctions, data and transaction processing security, payment card industry data security standards, records management, user-generated content hosted on websites we operate, privacy practices, data residency, corporate governance, anti-trust and competition, team member and third-party complaints, telemarketing regulations, telephone consumer regulations, government affairs and other regulatory requirements affecting trade and investment. Our clients are located around the world, and the laws and regulations that apply include, among others, U.S. federal laws and regulations such as the Fair Credit Reporting Act, Gramm-Leach-Bliley Act, the Health Insurance Portability and Accountability Act ("HIPAA"), the Health Information Technology for Economic and Clinical Health Act, Telephone Consumer Protection Act, Telemarketing Sales Rule, state laws on third-party administration services, utilization review services, data privacy and protection telemarketing services or state laws on debt collection in the U.S., collectively enforced by numerous federal and state government agencies and attorneys general, as well as similar consumer protection laws in other countries in which our clients' customers are based. Failure to perform our services in a manner that complies with any such requirements could result in breaches of contracts with our clients. The application of these laws and regulations to our clients is often unclear and may at times conflict. The global nature of our operations increases the difficulty of compliance. For example, in many foreign countries, particularly in those with developing economies, it is common to engage in business practices that are prohibited by regulations applicable to us or our clients, including Canada's Corruption of Foreign Public Officials Act and the United States Foreign Corrupt Practices Act. We cannot provide assurance that our clients will not take actions in violation of our internal policies or Canadian or United States laws. Compliance with these laws and regulations may further be challenged by the remote-working environment caused by the COVID-19 pandemic. For example, payment card industry and HIPAA guidance is evolving in light of the increase in remote-working conditions globally, and thus there exists uncertainty over the additional cost and ability to comply with such evolving standards. Compliance with these laws and regulations may involve significant costs, consume significant time and resources or require changes in our business practices that result in reduced revenue and profitability. We may also face burdensome and expensive governmental investigations or enforcement actions regarding our compliance, including being subject to significant fines. Non-compliance could also result in fines, damages, criminal sanctions against us, our officers or our team members, prohibitions on the conduct of our business, and damage to our reputation, restrictions on our ability to process information, allegations by our clients that we have not performed our contractual obligations

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or other unintended consequences. In addition, we are required under various laws to obtain and maintain accreditations, permits and/or licenses for the conduct of our business in all jurisdictions in which we have operations and, in some cases, where our clients receive our services, including the United States, Canada and Europe. If we do not maintain our accreditations, licenses or other qualifications to provide our services or if we do not adapt to changes in legislation or regulation, we may have to cease operations in the relevant jurisdictions and may not be able to provide services to existing clients or be able to attract new clients. Our failure to comply with applicable legal and regulatory requirements could have a material adverse effect on our business, financial performance, financial condition and cash flows.

We are subject to economic, political and other risks of doing business globally and in emerging markets.

        We are a global business with a substantial majority of our assets and operations located outside Canada and the United States. In addition, our business strategies may involve expanding or developing our business in emerging market regions, including Europe and Asia-Pacific. Due to the international nature of our business, we are exposed to various risks of international operations, including:

    adverse trade policies or trade barriers;

    inflation, hyperinflation and adverse economic effects resulting from governmental attempts to control inflation, such as the imposition of wage and price controls and higher interest rates;

    difficulties in enforcing agreements or judgments and collecting receivables in foreign jurisdictions;

    exchange controls or other currency restrictions and limitations on the movement of funds, such as on the remittance of dividends by subsidiaries;

    inadequate infrastructure and logistics challenges;

    sovereign risk and the risk of government intervention, including through expropriation, or regulation of the economy;

    challenges in maintaining an effective internal control environment with operations in multiple international locations, including language and cultural differences, expertise in international locations and multiple financial information systems;

    concerns relating to the protection and security of our personnel and assets; and

    labor disruptions, civil unrest, significant political instability, wars or other armed conflict.

        These risks may impede our strategy by limiting the countries and regions in which we are able to expand. The impacts of these risks may also only materialize after we have begun preparations and made investments to provide services in this new country or region. The exposure to these risks may require us to incur additional costs to mitigate the impact of these risks on our business.

        Additionally, there continues to be a great deal of uncertainty regarding U.S. and global trade policies for companies with multinational operations like ours. In recent years, there has been an increase in populism and nationalism in various countries around the world and, consequently, historical free trade principles are being challenged. For example, the U.S. government has indicated its intent to adopt a new approach to trade policy and, in some cases, to renegotiate, or potentially terminate, certain existing bilateral or multi-lateral trade agreements. As we continue to operate our business globally, our success will depend, in part, on the nature and extent of any such changes and how well we are able to anticipate, respond to and effectively manage any such changes.

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        Finally, international trade and political disputes can adversely affect the operations of multinational corporations like ours by limiting or disrupting trade and business activity between countries or regions. For example, we may be required to limit or halt operations, terminate client relationships or forego profitable client opportunities in countries which may, in the future, be subject to sanctions or other restrictions on business activity by corporations such as ours, by U.S. or Canadian legislation, executive order or otherwise. Some of our clients have been targeted by and may, in the future, be subject to such sanctions. Additionally, failure to resolve the trade dispute between the countries may also lead to unexpected operating difficulties in certain countries, including enhanced regulatory scrutiny, greater difficulty transferring funds or negative currency impacts.

        All the foregoing could have a material adverse effect on our business, financial performance, financial condition and prospects.

Some of our contractual arrangements with our clients require us to deliver a minimum quality of service, and our failure to meet those quality standards could adversely impact our business or subject us to liability or penalties.

        Most of our agreements with clients contain service level and performance requirements, including requirements relating to the quality of our services. The services we provide are often critical to our clients' businesses, and any failure to consistently provide those services in accordance with contractual specifications, whether as a result of errors made by our team members or otherwise, could disrupt the client's business and result in harm to our reputation, reduction of the likelihood that our clients recommend us to others, an obligation for us to pay penalties to the client under the contract, a reduction in revenues or a claim for substantial damages against us, regardless of whether we are responsible for that failure. In addition, lockdowns and other measures imposed by governments around the world, as well as other resulting impacts of the COVID-19 pandemic, may result in our temporary inability to meet the service level and performance requirements of our clients. If we fail to meet our contractual obligations or otherwise breach obligations to our clients or vendors, we could be subject to legal liability.

        We may enter into non-standard agreements because we perceive an important economic opportunity by doing so or because our personnel did not adequately adhere to our guidelines for the entry into contracts with new or existing clients. In addition, with respect to our client contracts, the contracting practices of our competitors may cause contract terms and conditions that are unfavorable to us to become standard in the marketplace. If we cannot or do not perform our obligations with clients or vendors, we could face legal liability and our contracts might not always protect us adequately through limitations on the scope and/or amount of our potential liability. If we cannot, or do not, meet our contractual obligations to provide solutions and services to clients, and if our exposure is not adequately limited through the enforceable terms of our agreements, we might face significant legal liability and our business, financial performance, financial condition and cash flows could be materially and adversely affected. Similarly, if we cannot, or do not, meet our contractual obligations with vendors, such as licensors, the vendors may have the right to terminate the contract, in which case we may not be able to provide clients solutions and services dependent on the products or services provided to us by such contracts.

The unauthorized disclosure of sensitive or confidential client and customer data could expose us to protracted and costly litigation, damage our reputation and cause us to lose clients.

        We are typically required to process, and sometimes collect and/or store sensitive data, including, but not limited to, personal data regulated by the General Data Protection Regulation ("GDPR"), The Personal Information Protection and Electronic Documents Act, California Consumer Privacy Act ("CCPA"), the California Invasion of Privacy Act, Personal Data Protection Bill of 2018, and the Data Privacy Act of 2012, of our clients' end customers in connection with our services, including names,

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addresses, social security numbers, personal health information, credit card account numbers, checking and savings account numbers and payment history records, such as account closures and returned checks. In addition, we collect and store data regarding our team members. As a result, we are subject to various data protection laws and regulations (as described above), and other industry-specific regulations and privacy laws and standards in the countries in which we operate, including the GDPR, the CCPA, the HIPAA, the Health Information Technology for Economic and Clinical Health Act and the Payment Card Industry Data Security Standard, and the failure to comply with such laws could result in significant fines and penalties. The legislative and regulatory frameworks for privacy issues is constantly evolving in many countries where we operate and are likely to remain uncertain and dynamic for the foreseeable future. Legislators and regulators in numerous jurisdictions are increasingly adopting new privacy, information security and data protection guidance, laws and regulations, and compliance with current or future privacy, information security and data protection laws and regulations could result in higher compliance, technology or operating costs. The interpretation and application of such laws is often unclear or unsettled, and such laws may be interpreted and applied in a manner inconsistent with our current policies and practices, which may require changes to the features of our company's platform or prohibit certain of our operations in certain jurisdictions. In addition, certain jurisdictions have adopted laws and regulations that restrict the transfer of data belonging to residents outside of their country. These laws and regulations could limit our ability to transfer such data to the locations in which we conduct operations, which would place limitations on our ability to operate our business.

        Many jurisdictions, including all U.S. states, have enacted laws requiring companies to notify individuals and authorities of security breaches involving certain types of personal information. In addition, our agreements with our clients may obligate us to investigate and notify our clients of, and provide cooperation to our clients with respect to, such breaches. Many of our agreements with our clients do not include any limitation on our liability to them with respect to breaches of our obligation to keep the information we receive from them confidential. A failure to comply with these notification requirements could expose us to liability.

        In the European Union, the GDPR went into effect in May 2018. The GDPR supersedes European Union member states' national protection laws and imposes privacy and data security compliance obligations and increased penalties for noncompliance. In particular, the GDPR has introduced numerous privacy-related changes for companies operating within and outside the European Union, including greater control for, and rights granted to, data subjects, increased data portability for European Union consumers, data breach notification requirements, restrictions on automated decision-making and increased fines. GDPR enforcement has begun, and companies have faced fines for violations of certain provisions. Fines can reach as high as 4% of a company's annual total revenue, potentially including the revenue of a company's international affiliates. Additionally, foreign governments outside of the European Union are also taking steps to fortify their data privacy laws and regulations. For example, Brazil, India, the Philippines as well as some countries in Central America and Asia-Pacific and some U.S. states, have implemented or are considering GDPR-like data protection laws which could impact our engagements with clients (existing and potential), vendors and team members in those countries. The GDPR and the introduction of similar legislation in other jurisdictions increases the cost of regulatory compliance and increases the risk of non-compliance therewith, which could have an adverse effect on our business, financial performance, financial condition and cash flows.

        Although our network security and the authentication of our customer credentials are designed to protect against unauthorized disclosure, alteration and destruction of, and access to, data on our networks, it is impossible for such security measures to be perfectly effective. There can be no assurance that such measures will function as expected or will be sufficient to protect our network infrastructure against certain attacks, and there can be no assurance that such measures will successfully prevent or mitigate service interruptions or further security incidents. All network infrastructure is

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vulnerable to rapidly evolving cyber-attacks, and our user data and corporate systems and security measures may be breached due to the actions of outside parties (including malicious cyberattacks), team member error, malfeasance, internal bad actors, a combination of these, or otherwise. A breach may allow an unauthorized party to obtain access to or exfiltrate our data or our users' or clients' data. Additionally, outside parties may attempt to fraudulently induce team members, users or clients to install malicious software, disclose sensitive information or access credentials, or take other actions that may provide access to our data or our users' or clients' data. Because modern networking and computing environments are increasing in complexity and techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently, increase in sophistication over time or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, we may be unable to anticipate these techniques or implement adequate preventative measures. If an actual or perceived breach of our security occurs (or a breach of a client's security that can be attributed to our fault or is perceived to be our fault), the market perception of the effectiveness of our security measures could be harmed and we could lose users and clients. Security breaches also expose us to a risk of loss of this information, class action or other litigation brought both by clients and by individuals whose information was compromised, remediation costs, increased costs for security measures, loss of revenue, damage to our reputation, and potential liability.

        While we believe our team members undergo appropriate training, if any person, including any of our team members, negligently disregards or intentionally breaches controls or procedures with which we are responsible for complying with respect to such data or otherwise mismanages or misappropriates that data, or if unauthorized access to or disclosure of data in our possession or control occurs, we could be subject to significant liability to our clients or our clients' customers for breaching contractual confidentiality and security provisions or for permitting access to personal information subject to privacy laws, as well as liability and penalties in connection with any violation of applicable privacy laws or criminal prosecution. Unauthorized disclosure of sensitive or confidential client or team member data, whether through breach of computer systems, systems failure, team member negligence, fraud or misappropriation, or otherwise, could damage our reputation and cause us to lose clients and result in liability to individuals whose information was compromised. Similarly, unauthorized access to or through our information systems and networks or those we develop or manage for our clients, whether by our team members or third parties, could result in negative publicity, damage to our reputation, loss of clients or business, class action or other litigation, costly regulatory investigations and other potential liability.

        Additionally, remote-working solutions deployed during the COVID-19 pandemic could result in heightened confidentiality risks on account of services being delivered in a physically unsupervised environment and via computer systems and networks outside of our control and management. If any person, including any of our team members, intentionally or inadvertently penetrates our perimeter or internal network security, computing infrastructure or otherwise mismanages or misappropriates sensitive data, or discloses or distributes any such data in an unauthorized manner, we could be subject to significant liability and class action or other lawsuits from our clients or their customers for breaching contractual confidentiality provisions or privacy laws, or investigations and penalties from regulators. Under some of our client contracts, we have, from time to time, agreed to pay for the costs of remediation or notice to end users or credit monitoring, as well as other costs.

        In addition, certain third parties to whom we outsource certain of our services or functions, or with whom we interface, store our information assets or our clients' confidential information, as well as those third parties' providers, are also subject to the risks outlined above. Although we generally require our vendors to hold sufficient liability insurance and provide indemnification for any liability resulting from the vendor's breach of the services agreement, a breach or attack affecting these third parties, any delays in our awareness of the occurrence of such breach or attack, and our or third parties' inability to promptly remedy such a breach or attack, could also harm our reputation, business,

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financial performance, financial condition and cash flows, and could subject us to liability for damages to our clients and their customers. Failure to select third parties that have robust cybersecurity and privacy capabilities may also jeopardize our ability to attract new clients, who may factor their assessment of risks associated with such third parties in their decision.

        Cyber-attacks penetrating the network security of our data centers or any unauthorized disclosure or access to confidential information and data of our clients or their end customers could also have a negative impact on our reputation and client confidence, which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

Our team members, contractors, consultants or other associated parties may behave in contravention of our internal policies or laws and regulations applicable to us, or otherwise act unethically or illegally, which could harm our reputation or subject us to liability.

        We have implemented and expect to implement a number of internal policies, including a code of ethics and conduct and policies related to security, privacy, respectful behavior in the workplace, anti-bribery and anti-corruption, security, localized labor and employment regulations, health and safety and securities trading in order to promote and enforce ethical conduct and compliance with laws and regulations applicable to us. Compliance with these policies requires awareness and understanding of the policies and any changes therein by the parties to whom they apply. We may fail to effectively or timely communicate internal policies or changes therein to our team members, contractors, consultants or other associates, and such persons may otherwise fail to follow our policies for reasons beyond our control. We are exposed to the risk that our team members, independent contractors, consultants or other associates may engage in activity that is unethical, illegal or otherwise contravenes our internal policies or the laws and regulations applicable to us, whether intentionally, recklessly or negligently. It may not always be possible to identify and deter misconduct, and the precautions we take to detect and prevent this activity may be ineffective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with these laws or regulations. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including harm to our reputation and the imposition of significant fines or other sanctions, all of which could have a material adverse effect on our client relationships, business, financial condition and financial performance.

Our ability to meet the expectations of clients of our content moderation services, including the expectations of their users, and the expectations of our clients towards our ability to meet the demands of their future growth, may be adversely impacted due to factors beyond our control, which could have an adverse effect on our business, reputation, financial performance, financial condition and cash flows, and could expose us to liability.

        Our content moderation team members may erroneously or deliberately flag or remove content or fail to take action with respect to content that is not in accordance with the requirements set out by our clients. Any combination of the foregoing may result in a failure to meet our clients' expectations, which could result in clients reducing or terminating their services with us and which could have an adverse effect on our business, reputation, financial performance, financial condition and cash flows.

        The content that our team members analyze is selected for review by our clients and moderated by our team members based on our clients' policies and rules. The tools used by our clients to identify content may fail to identify content that violates relevant content policy or community guidelines or, in certain jurisdictions, legal requirements. This could be the result of deliberate evasive actions by users, limitations in our clients' content identification tools, bias, errors, malfunctions and other factors. In addition, our team members may erroneously moderate content due to the subjective nature of our clients' policies or rules or simply because of a mistake. Objectionable content that our clients and their

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users expect our content moderation team members to review and remove could therefore not be subject to review by our team members or be improperly moderated. Although the design of the methods employed to select content for review are not within the scope of the services we provide, the failure of objectionable content to be appropriately moderated on our clients' platform, for whatever reason, could adversely impact our reputation for content moderation service delivery and our ability to attract and retain clients. Additionally, a failure to properly moderate objectionable content on our clients' platform could expose us to liability to users of our clients' platform. Furthermore, as we continue to expand our content moderation service offerings, certain clients may require us to assume liability for failure to comply with certain contractual requirements imposed by the client related to certain objectionable user-generated content on our clients' platforms, which may increase our costs and materially impact our results of operations.

        Furthermore, as demand for our content moderation solutions grows, we will need to scale our operations to address the demand from our clients. Although the amount of content that we are required to moderate under our contracts with our clients is agreed to in advance, our clients may experience a sudden, unexpected increase in content requiring moderation resulting in an unplanned increase in the need for our services for which a contract is not in place. In the face of this increased demand from our clients, we may not be able to effectively scale our operations by hiring, training and integrating new qualified content moderation team members. Any inability to quickly scale our content moderation team or to meet the demands of our content moderation clients may result in a loss of clients or business or damage to our reputation, which could have an adverse effect on our business, reputation, financial performance, financial condition and cash flows.

Our content moderation team members may suffer adverse emotional or cognitive effects in the course of performing their work, which could adversely affect our ability to attract and retain team members and could result in increased costs, including due to claims against us.

        Our content moderation team members are tasked with reviewing discriminatory, threatening, offensive, illegal or otherwise inappropriate multimedia content. Reviewing this content is emotionally and cognitively challenging for many of our team members, which may result in our team members suffering adverse psychological or emotional consequences. These impacts could lead to higher expenses to support our team members, higher levels of voluntary attrition and increased difficulty retaining and attracting team members. If we are not able to effectively attract and retain content moderation team members, we may experience a decline in our ability to meet our clients' expectations, which may adversely impact the demand for our services.

        Additionally, we may be required under applicable law to provide accommodations for team members who experience or who assert they are experiencing mental health consequences. These accommodations could result in increased costs and reductions in the availability of team members who can perform these tasks, which could have a material adverse effect on our financial results. Our content moderation team members may also make claims under workers' compensation programs or other public or private insurance programs in connection with negative mental health consequences experienced in connection with their employment, which could result in increased costs. We may also be exposed to claims by team members under applicable labor and other laws. Such litigation, whether or not ultimately successful, could involve significant legal fees and result in costly remediation, including payments for psychological treatment and ongoing monitoring, preventative intervention and treatment costs, which could have a material adverse effect on our financial results. While we have taken meaningful measures to ensure the well-being of our team members, these measures may not be sufficient to mitigate the effects on team members or our potential liability under applicable law.

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Our business could be materially and adversely affected if we do not protect our intellectual property or if our services are found to infringe on the intellectual property of others.

        Our success depends in part on certain methodologies, practices, tools and technical expertise we utilize in providing our services. We engage in designing, developing, implementing and maintaining applications and other proprietary materials. In order to protect our rights in these various materials, we may seek protection under trade secret, patent, copyright and trademark laws. We also generally enter into confidentiality and nondisclosure agreements with our clients and potential clients, and third-party vendors, and seek to limit access to and distribution of our proprietary information. For our team members and independent contractors, we require confidentiality and proprietary information agreements. These measures may not prevent misappropriation or infringement of our intellectual property or proprietary information and a resulting loss of competitive advantage. Additionally, we may not be successful in obtaining or maintaining trademarks for which we have applied.

        We may be unable to protect our intellectual property and proprietary technology or brand effectively, which may allow competitors to duplicate our technology and products and may adversely affect our ability to compete with them. Given our international operations, the laws, rules, regulations and treaties in effect in the jurisdictions in which we operate, the contractual and other protective measures we take may not be adequate to protect us from misappropriation or unauthorized use of our intellectual property, or from the risk that such laws could change. To the extent that we do not protect our intellectual property effectively, other parties, including former team members, with knowledge of our intellectual property may leave and seek to exploit our intellectual property for their own or others' advantage. We may not be able to detect unauthorized use and take appropriate steps to enforce our rights, and any such steps may not be successful. Infringement by others of our intellectual property, including the costs of enforcing our intellectual property rights, may have a material adverse effect on our business, financial performance, financial condition and cash flows.

        In addition, competitors or others may allege that our systems, processes, marketing, data usage or technologies infringe on their intellectual property rights. Non-practicing entities may also bring baseless, but nonetheless costly to defend, infringement claims. We could be required to indemnify our clients if they are sued by a third party for intellectual property infringement arising from materials that we have provided to the clients in connection with our services and deliverables. We may not be successful in defending against such intellectual property claims or in obtaining licenses or an agreement to resolve any intellectual property disputes. Given the complex, rapidly changing and competitive technological and business environment in which we operate, and the potential risks and uncertainties of intellectual property-related litigation, we cannot provide assurances that a future assertion of an infringement claim against us or our clients will not cause us to alter our business practices, lose significant revenues, incur significant license, royalty or technology development expenses, or pay significant monetary damages or legal fees and costs. Any such claim for intellectual property infringement may have a material adverse effect on our business, financial performance, financial condition and cash flows.

We may be subject to litigation and other disputes, which could result in significant liabilities and adversely impact our financial results.

        From time to time, we are subject to lawsuits, arbitration proceedings, and other claims brought or threatened against us in the ordinary course of business. These actions and proceedings may involve claims for, among other things, compensation for personal injury, workers' compensation, employment discrimination and other employment-related damages, damages related to breaches of privacy or data security, breach of contract, property damage, liquidated damages, consequential damages, punitive damages and civil penalties or other losses, or injunctive or declaratory relief. In addition, we may also be subject to class action lawsuits, including those alleging violations of the Fair Labor Standards Act, state and municipal wage and hour laws, and misclassification of independent contractors.

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        Due to the inherent uncertainties of litigation and other dispute resolution proceedings, we cannot accurately predict their ultimate outcome. The outcome of litigation, particularly class action lawsuits, is difficult to assess or quantify. Class action lawsuits may seek recovery of very large or indeterminate amounts. Accordingly, the magnitude of the potential loss may remain unknown for substantial periods of time. These proceedings could result in substantial cost and may require us to devote substantial resources to defend ourselves. The ultimate resolution of any litigation or proceeding through settlement, mediation, or a judgment could have a material impact on our reputation and adversely affect our financial performance and financial position.

Risks Related to Our Acquisition of Lionbridge AI and its Business

        Many of the risks affecting our business also impact the business of Lionbridge AI, which we acquired on December 31, 2020. In connection with the acquisition of Lionbridge AI, we are subject to the following risks.

Our acquisition of Lionbridge AI remains subject to review by CFIUS and we are not certain how the outcome of the review will impact our business.

        We completed our acquisition of Lionbridge AI on December 31, 2020. In connection with the acquisition, we submitted a declaration filing with CFIUS. At the end of its 30-day assessment of the declaration filing, CFIUS requested that we file a joint voluntary notice pursuant to Section 721 of the Defense Production Act, which triggered an additional 45-day review period. Our understanding is that the additional CFIUS review is focused on certain commercial relationships that TELUS, our controlling shareholder, has with certain foreign telecom network infrastructure vendors. We have submitted the requested joint notice filing and provided additional information requested by CFIUS staff. Based on our discussions with CFIUS staff, we determined we could close the acquisition of Lionbridge AI prior to the conclusion of the pending CFIUS review. While we believe that CFIUS will complete its review of the joint voluntary notice and clear our acquisition of Lionbridge AI without condition, CFIUS may instead request that we and TELUS make assurances regarding our use in the United States of certain telecom network infrastructure equipment sold by foreign entities. The statutory review period for the joint voluntary notice expires in March 2021, at which point CFIUS will either clear the transaction or initiate a 45-day formal investigation. We can provide no assurance regarding the resolution of the CFIUS process, including whether the possible conditions that are described above will be the only conditions that are imposed on us or TELUS. CFIUS may impose additional conditions or mitigation measures, which could increase our estimated costs or otherwise negatively impact our consolidated operations. Although CFIUS has authority to require divestitures in connection with its review of any transaction, it is our understanding that CFIUS sought an additional review period due to its interest in the commercial relationships of TELUS and not based on concerns regarding our business or that of Lionbridge, and we believe based on our discussion with CFIUS staff that the likelihood of a divestment outcome in connection with the Lionbridge acquisition is remote.

Our business would be adversely affected if individuals providing their data annotation services through Lionbridge AI's crowdsourcing solutions were classified as employees.

        The classification of certain individuals who provide their services through third party digital platforms as independent contractors is currently being challenged in courts, by legislators and by government agencies in the United States and many other countries where our Lionbridge AI business uses the services of independent contractors. Lionbridge AI has been involved in, and we expect to be involved in, litigation related to this classification. Although Lionbridge AI has made and we will make assessments of the different legal and regulatory implications related to the independent contractor classification of its annotators, we generally believe that most individuals who provide their data annotation services through Lionbridge AI's crowdsourcing solution are independent contractors

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because, among other things, they can choose whether, when, and where to provide services, are free to provide services on competitors' platforms, and use their own equipment. We may not be successful in defending the independent contractor classification in the jurisdictions where we operate or where such classification is challenged. The costs associated with defending, settling, or resolving any future lawsuits (including demands for arbitration) relating to the independent contractor classification could be material to our business.

        Changes to foreign, state, and local laws governing the definition or classification of independent contractors, or judicial decisions regarding independent contractor classification, could require classification of our independent contractors as employees (or workers, quasi-employees or other statuses in jurisdictions where those statuses exist) and/or representation of our crowd members by labor unions. If, as a result of legislation or judicial decisions, we are required to classify independent contractors as employees (or as workers, quasi-employees or other statuses in jurisdictions where those statuses exist), we would incur significant additional expenses for compensating independent contractors, potentially including expenses associated with the application of wage and hour laws (including minimum wage, overtime, and meal and rest period requirements), employee benefits, social security contributions, taxes (direct and indirect), and penalties. In addition, if we are required to classify independent contractors as employees in any jurisdiction, this may impact our current financial statement presentation. Further, any such reclassification would require us to change our business model for these services, and consequently have an adverse effect on our business and financial condition. If any of the foregoing were to occur on a widespread basis, we would not realize the expected value of the acquisition of Lionbridge AI and our business, financial condition and results of operations would be adversely affected.

If we are unable to attract or maintain a critical mass of qualified independent contractors, whether as a result of competition or other factors, the crowdsourcing solution of the Lionbridge AI business will become less appealing to our clients, and our financial results would be adversely impacted.

        The success of the Lionbridge AI business depends significantly on its ability to attract and retain a large number of individuals to serve as annotators in various geographic markets. If individuals choose not to offer their services through the Lionbridge AI crowdsourcing solution, or elect to offer them through a competitor's solution, we may lack a sufficient supply of qualified individuals to service the entirety of our clients' demand with sufficient speed, scale and quality or at all. To the extent that we are unable to onboard a sufficient number of individuals to provide data annotation services, we may need to increase the incentives that we offer to individuals providing those services in order to maintain sufficient capacity to service our clients, which will increase costs and make our services less competitive. In addition, if Lionbridge AI's top clients reduce the volume of services they receive from the Lionbridge AI business or otherwise limit, modify or terminate their relationships with us, including as a result of the change of control in Lionbridge AI in connection with the acquisition, we may lack sufficient opportunities for our independent contractors to provide annotation services, which may reduce the perceived utility of our solution.

        The number of independent contractors on Lionbridge AI's crowdsourcing solution could decline or fluctuate as a result of a number of factors, including individuals ceasing to provide their services through the solution, low switching costs between competitor solutions or services, pricing models (including our inability to maintain or increase certain incentives), or other aspects of our business.

        If we were to experience the foregoing supply constraints with respect to recruiting or retaining individuals on our solution, we may not be able to realize the expected value of the acquisition of Lionbridge AI and our business, financial condition and results of operations would be adversely affected.

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We may not be able to integrate Lionbridge AI into our ongoing business operations, which may result in our inability to fully realize the intended benefits of the acquisition, or may disrupt our current operations, which could have a material adverse effect on our business, financial position and results of operations.

        Although we have begun the integration of the operations of Lionbridge AI into our business, this process involves complex operational, technological and personnel-related challenges, which are time-consuming and require significant investment and may disrupt our ongoing business operations. Furthermore, integration involves a number of risks, including, but not limited to:

    difficulties or complications in combining the companies' operations;

    differences in controls, procedures and policies, regulatory standards and business cultures among the combined companies;

    the diversion of management's attention from our current business operations;

    the potential loss of key personnel who choose not to remain with us after the acquisition;

    labor disputes, strikes and other disruptions arising from the collective bargaining agreements in Finland, Germany and France;

    the potential loss of key clients who choose not to do business with the combined company, including as a result of change of control provisions being triggered by the acquisition in agreements with key clients, and changes to contractual terms demanded by clients in light of the acquisition;

    difficulties or delays in consolidating Lionbridge AI's information technology and other platforms, including implementing systems designed to continue to ensure that we maintain effective disclosure controls and procedures and internal control over financial reporting for the combined company and enable us to continue to comply with IFRS and applicable U.S. and Canadian securities laws and regulations;

    unanticipated costs and other assumed contingent liabilities, including the assumption of Lionbridge AI's existing, threatened and pending litigation;

    difficulty comparing and integrating financial reporting due to differing financial and/or internal reporting systems;

    making any necessary modifications to internal controls over financial reporting to comply with applicable rules and regulations;

    possible tax costs or inefficiencies associated with integrating the operations of the combined global company;

    we are dependent on a subsidiary of the seller of the Lionbridge AI business, for certain functions following the closing of the acquisition under the terms of our transition services agreement, including the use of its proprietary, tech-enabled workforce recruitment, training and management software platform and database, and it may take longer than expected for us to put in place internal replacement functionality; and/or

    the subsidiary of the seller of the Lionbridge AI business may not perform as anticipated under the transition services agreement.

        These factors could cause us to not fully realize the anticipated financial and/or strategic benefits of the Lionbridge AI acquisition, which could have a material adverse effect on our business, financial condition and/or results of operations.

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Even if we are able to successfully integrate Lionbridge AI into our business operations, we may not be able to realize the revenue and other synergies and growth that we anticipate from the acquisition as expected.

        Even if we are able to successfully integrate Lionbridge AI in our company, we may not be able to realize the revenue and other synergies and growth that we anticipate we should achieve from the acquisition in the time frame that we currently expect or at all, and the costs of achieving these benefits may be higher than what we currently expect, because of a number of risks, including, but not limited to the following:

    the acquisition may not advance our business strategy as we expected;

    we may not be able to increase Lionbridge AI's client base as expected;

    Lionbridge AI's top clients, five of whom represented 98% of its revenues for the year ended December 31, 2019, with Google representing 65% of revenues in this period, may limit the volume of services they purchase from Lionbridge AI or otherwise limit or terminate the relationship with Lionbridge AI;

    we may not be as successful in our cross-selling efforts among our clients and Lionbridge AI's clients as expected;

    the carrying amounts of goodwill and other purchased intangible assets may not be recoverable;

    the size of growth in the data annotation market may not meet our expectations and may not grow at the anticipated rate or at all;

    the combined entity may be unable to successfully compete in Lionbridge AI's markets;

    Lionbridge AI's independent contractors may be legally required to be classified as employees (or workers or quasi-employees where those statuses exist); and

    Lionbridge AI may experience a lack of supply of independent contractors that inhibits its ability to serve clients.

        As a result of these and other risks applicable to Lionbridge AI's business, some of which may be currently unknown to us, the Lionbridge AI acquisition and integration may not contribute to our results of operations as expected, we may not achieve the expected synergies when expected or at all, and we may not achieve the other anticipated strategic and financial benefits of the acquisition.

The risks arising with respect to the historic business and operations of Lionbridge AI may be different than we anticipate, which could significantly increase the costs and decrease the benefits of the acquisition and materially and adversely affect our operations going forward.

        Although we performed significant financial, legal, technological and business due diligence with respect to Lionbridge AI, we may not have appreciated, understood or fully anticipated the extent of the risks associated with its business and the acquisition and integration. In the stock purchase agreement we entered into with LBT Investment Holdings, LLC, we have been indemnified for certain matters in order to mitigate the consequences of certain breaches of surviving covenants and the risks associated with historic operations. Although we have the benefit of the indemnification provisions of the stock purchase agreement and the escrow funds and insurance policies that Lionbridge AI and we have in place, our exercise of due diligence and risk mitigation strategies may not anticipate or mitigate the full risks of the acquisition and the associated costs. We may not be able to contain or control the costs associated with unanticipated risks or liabilities, which could materially and adversely affect our business, liquidity, capital resources or results of operations.

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One of Lionbridge AI's clients accounts for 65% of its revenue and five clients represent 98% of its revenue and loss of or reduction in business from, or consolidation of, these or any of these clients could have a material adverse effect on its and our business, financial condition, financial performance and prospects.

        Lionbridge AI has derived a significant portion of its revenue from its top five clients. Google, Lionbridge AI's top client, individually accounted for approximately 65% of revenues for the year ended December 31, 2019, with Lionbridge AI's top five clients combined accounting for approximately 98% of revenues for the same the period. The loss of any of these five clients or a loss of revenue from any one of these clients, whether as a result of our acquisition of Lionbridge AI or otherwise, would have a material adverse effect on our business, financial condition, financial performance and prospects.

Data annotators may be replaced by developing technology, which could have a material adverse effect on our business, financial condition, financial performance and prospects.

        The field of data annotation is evolving rapidly. Our data annotation business relies on a team of global data annotators to enact solutions for clients. Developing technology may in the future replace data annotators in performing the annotation services that our human data annotators currently provide. We do not know if, when or to what extent such a change or other technological developments that shifts from the use of human data annotators to a fully technological solution may occur. If our business model does not evolve with such technological developments, such developments could have a material adverse effect on our business, liquidity, capital resources and results of operations.

We face increasing competition from companies that offer services similar to the ones offered by our Lionbridge AI business. If we are unable to differentiate to compete effectively, our business, financial performance, financial condition and cash flows could be materially adversely impacted.

        The market for the services offered by our Lionbridge AI business is increasingly competitive and we expect competition to intensify and increase from a number of existing and new competitors. Competitors may have significantly greater market recognition than we do in the field of data annotation and other competitors may be better positioned to market themselves to smaller and mid-sized markets. Many of these existing and new competitors have greater financial, human and other resources, greater technological expertise, longer operating histories and more established relationships than we do in the field of data annotation. In addition, some of these competitors may enter into strategic or commercial relationships among themselves or with larger, more established companies in order to increase their ability to address client needs and increase market share. From time to time, clients who currently use our data annotation services may determine that they can provide these services in-house. As a result, we face the competitive pressure to continually offer our data annotation services in a manner that will be viewed by our clients as better and more cost-effective than what they could provide themselves.

        Our inability to compete successfully against companies that offer services similar to our data annotation services and to offer our clients a compelling alternative to taking the services we provide in-house could result in increased client churn, revenue loss, pressures on recruitment and retention of data annotators, service price reductions and increased marketing and promotional expenses, or reduced operating margins which could have a material adverse effect on our business, financial performance, financial condition and cash flows.

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Risks Related to Becoming a Public Company and Our Relationship with TELUS

We have no history of operating as a separate, publicly-traded company, and may not have access to the same resources and advantages that we would have if we did not become a public company, such that our historical financial information is not necessarily representative of the results that we would have achieved as a separate, publicly-traded company and may not be a reliable indicator of our future results.

        Although we will remain as a consolidated subsidiary of TELUS for the foreseeable future and continue to enjoy certain benefits, including access to a broad range of service operations outside of our own area of operations (including with certain vendors where we receive services pursuant to such vendor's contract with TELUS), higher purchasing power, and lower overhead costs for certain corporate functions such as investor relations that are provided to us by TELUS, following our initial public offering there is a risk that, by separating from TELUS, we may incur higher costs for certain functions and overhead as we establish independent corporate functions, lose opportunities to pursue integrated strategies with TELUS' other businesses, lose more favorable access to capital markets and other funding facilitated by TELUS, engage vendors for services on terms that are not as favorable as when we had previously received services from such vendors under a TELUS agreement, and become more susceptible to market fluctuations and other adverse events, than we would have been if we did not become a public company. Additionally, as part of TELUS, we have been able to leverage its historical market reputation and performance to recruit and retain key personnel to run our business. As a publicly-traded company, we will not have the same historical market reputation and it may be more difficult for us to recruit or retain such key personnel. Furthermore, after this offering, the cost of capital for our businesses may be higher than TELUS' cost of capital prior to the offering. Other changes may occur in our cost structure, management, financing and business operations as a result of operating as a company separate from TELUS, and these changes could be material to us. As a result, our historical financial information is not necessarily representative of the results that we would have achieved as a separate, publicly-traded company and may not be a reliable indicator of our future results.

We expect that TELUS and its directors and officers will have limited liability to us and could engage in business activities that could be adverse to our interests and negatively affect our business.

        TELUS and its directors and officers will have no legal obligation to refrain from engaging in the same or similar business activities or lines of business as we do or from doing business with any of our clients. Any such activities could be adverse to our interests and could negatively affect our business, financial performance, financial condition and cash flows.

Potential indemnification liabilities to TELUS pursuant to various intercompany agreements could materially and adversely affect our businesses, financial condition, financial performance and cash flows.

        The agreements between us and TELUS, among other things, provide for indemnification obligations designed to make us financially responsible for substantially all liabilities that may exist relating to our business activities, whether incurred prior to or after the initial public offering. If we are required to indemnify TELUS under the circumstances set forth in the agreements we enter into with TELUS, we may be subject to substantial liabilities. Please refer to the section entitled "Certain Relationships and Related Party Transactions—Our Relationship with TELUS".

After the offering, certain of our executive officers and directors may have actual or potential conflicts of interest.

        Certain of our executive officers and directors may have relationships with third parties that could create, or appear to create, potential conflicts of interest. Our executive officers and directors who are executive officers and directors of our significant shareholders could have, or could appear to have,

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conflicts of interests such as where our significant shareholders are required to make decisions that could have implications for both them and us. See "Management".

We may have received better terms from unaffiliated third parties than the terms we will receive in our agreements with TELUS.

        The agreements we have entered into and that we will enter into with TELUS in connection with this offering, including the TELUS MSA, the transition and shared services agreement and the master reseller agreement, were prepared, in certain cases, in the context of our initial public offering. These agreements were negotiated by us with TELUS and may not reflect terms that would have been agreed to in an arm's-length negotiation between unaffiliated third parties. For more information on the agreements we have entered into, or will enter into, please refer to the section entitled "Certain Relationships and Related Party Transactions".

Risks Related to Our Subordinate Voting Shares

The dual-class structure that will be contained in our articles has the effect of concentrating voting control and the ability to influence corporate matters with TELUS and Baring, who held our shares prior to our initial public offering.

        Following the consummation of this offering, we will have two classes of shares outstanding: multiple voting shares and subordinate voting shares. Our multiple voting shares will have ten votes per share and our subordinate voting shares, which are the shares we and the selling shareholders are selling in this offering, will have one vote per share. TELUS and Baring are the only shareholders who hold the multiple voting shares. Following the completion of this offering, it is expected that TELUS will have approximately 66.6% of the combined voting power of our outstanding shares and Baring will have approximately 31.5% of the combined voting power of our outstanding shares (or, if the underwriters' over-allotment option is exercised in full, TELUS and Baring would have approximately 68.0% and 29.9%, respectively, of the combined voting power of our outstanding shares following this offering).

        As a result of the dual-class share structure, TELUS will control a majority of the combined voting power of our shares and therefore be able to control all matters submitted to our shareholders for approval until such date that TELUS sells its multiple voting shares, chooses to voluntarily convert them into subordinate voting shares or it retains less than 10% of our outstanding shares on a combined basis, which would result in the automatic conversion of its remaining multiple voting shares into subordinate voting shares. This concentrated control will limit or preclude your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents and any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring shareholder approval. The voting control may also prevent or discourage unsolicited acquisition proposals that you may feel are in your best interest as one of our shareholders. Future transfers by holders of multiple voting shares, other than permitted transfers to such holders' respective affiliates or to other permitted transferees, will result in those shares automatically converting to subordinate voting shares, which will have the effect, over time, of increasing the relative voting power of those holders of multiple voting shares who retain their multiple voting shares. For additional information, see "Description of Share Capital".

        In addition, because of the ten to one voting ratio between our multiple voting shares and subordinate voting shares, the holders of our multiple voting shares will continue to control a majority of the combined voting power of our outstanding shares even where the multiple voting shares represent a substantially reduced percentage of our total outstanding shares. The concentrated voting control of holders of our multiple voting shares will limit the ability of our subordinate voting shareholders to influence corporate matters for the foreseeable future, including the election of

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directors as well as with respect to decisions regarding amending of our share capital, creating and issuing additional classes of shares, making significant acquisitions, selling significant assets or parts of our business, merging with other companies and undertaking other significant transactions. As a result, holders of multiple voting shares will have the ability to influence or control many matters affecting us and actions may be taken that our subordinate voting shareholders may not view as beneficial. The market price of our subordinate voting shares could be adversely affected due to the significant influence and voting power of the holders of multiple voting shares. Additionally, the significant voting interest of holders of multiple voting shares may discourage transactions involving a change of control, including transactions in which an investor, as a holder of the subordinate voting shares, might otherwise receive a premium for the subordinate voting shares over the then-current market price, or discourage competing proposals if a going private transaction is proposed by one or more holders of multiple voting shares.

        Even if TELUS were to control less than a majority of the voting power of our outstanding shares, it may be able to influence the outcome of such corporate actions due to the director appointment rights and special shareholder rights we expect to grant to TELUS as part of the shareholders' agreement to be entered into in connection with our initial public offering. See "—TELUS will, for the foreseeable future, control the direction of our business, and the concentrated ownership of our outstanding shares and our entry into a shareholders' agreement in connection with this offering will prevent you and other shareholders from influencing significant decisions".

TELUS will, for the foreseeable future, control the direction of our business, and the concentrated ownership of our outstanding shares and our entry into a shareholders' agreement in connection with this offering will prevent you and other shareholders from influencing significant decisions.

        We expect to enter into a shareholders' agreement with TELUS and Baring providing for certain director nomination rights for TELUS and Baring and providing for a number of special shareholder rights for TELUS. Under the terms of the shareholders' agreement, we will agree to nominate individuals designated by TELUS as directors representing half of our eight-director board at the time of consummation of this offering, and a majority of the board upon appointment of a ninth director and thereafter, for as long as TELUS continues to beneficially own at least 50% of the combined voting power of our outstanding multiple voting shares and subordinate voting shares. Should TELUS cease to own at least 50% of the combined voting power of our outstanding multiple voting shares and subordinate voting shares, we will agree to nominate to our board such number of individuals designated by TELUS in proportion to its combined voting power, for so long as TELUS continues to beneficially own at least 5% of combined voting power of our outstanding multiple voting shares and subordinate voting shares, subject to a minimum of at least one director. The shareholders' agreement will also provide for appointment and observer rights for Baring. In addition, the shareholders' agreement will provide that: (1) for so long as TELUS continues to beneficially own at least 50% of the combined voting power of our multiple voting shares and subordinate voting shares, TELUS will be entitled, but not obligated, to select the chair of the board and the chairs of the human resources and governance and nominating committees; and (2) for so long as TELUS has the right to designate a nominee to our board of directors, it will also be entitled, but not obligated, to designate at least one nominee to the human resources and governance and nominating committees and one nominee for our apppointment to our audit committee (provided that following the earlier of the first anniversary of this offering or the appointment of a third independent director, such audit committee nominee will be independent), subject to compliance with the independence requirements of applicable securities laws and listing requirements of the NYSE and TSX. The shareholders' agreement will also provide for committee appointment rights for Baring. For more information on these director nomination rights, see "Certain Relationships and Related Party Transactions—Our Relationship with TELUS and Baring—Shareholders' Agreement".

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        Immediately following the completion of this offering, TELUS will have approximately 66.6% of the combined voting power of our outstanding shares (or 68.0% if the underwriters exercise their over-allotment option in full). Pursuant to the shareholders' agreement, Baring has agreed not to, directly or indirectly, sell, transfer or otherwise dispose of any multiple voting shares or subordinate voting shares without first discussing in good faith any such sale transaction with TELUS and providing TELUS with a right to purchase such shares. Should such right of first offer be provided and exercised, the combined voting power of our outstanding shares held by TELUS may increase further. As long as TELUS controls at least 50% of the combined voting power of our outstanding shares, it will generally be able to determine the outcome of all corporate actions requiring shareholder approval, including the election and removal of directors. Even if TELUS were to control less than 50% of the combined voting power of our outstanding shares, it will be able to influence the outcome of such corporate actions due to the director appointment rights and special shareholder rights we have granted to TELUS as part of the shareholders' agreement.

        In addition, pursuant to the shareholders' agreement, until TELUS ceases to hold at least 50% of the combined voting power of our outstanding shares, TELUS will have special shareholder rights related to certain matters including, among others, approving the selection, and the ability to direct the removal, of our CEO, approving the increase or decrease of the size of our board, approving the issuance of multiple voting shares and subordinate voting shares, approving amendments to our articles and authorizing entering into a change of control transaction, disposing of all or substantially all of our assets, and commencing liquidation, dissolution or voluntary bankruptcy or insolvency proceedings. As a result, certain actions that our board would customarily decide will require consideration and approval by TELUS and our ability to take such actions may be delayed or prevented, including actions that our other shareholders, including you, may consider favorable. We will not be able to terminate or amend the shareholders' agreement, except in accordance with its terms. See "Certain Relationships and Related Party Transactions—Our Relationship with TELUS and Baring—Shareholders' Agreement". We will also enter into a Collaboration and Financial Reporting Agreement with TELUS in connection with this offering that will, among other things, specify that certain matters or actions we take require advance review and consultation with TELUS. The agreement will also stipulate certain actions that require TELUS International board approval. See "Certain Relationships and Related Party Transactions—Collaboration and Financial Reporting Agreement".

        TELUS' interests may not be the same as, or may conflict with, the interests of our other shareholders. Investors in this offering will not be able to affect the outcome of any shareholder vote while TELUS controls the majority of the combined voting power of our outstanding shares and TELUS will also be able to exert significant influence over our board through its director nomination rights.

        As TELUS' interests may differ from ours or from those of our other shareholders, actions that TELUS takes with respect to us, as our controlling shareholder and pursuant to its rights under the shareholders' agreement, may not be favorable to us or our other shareholders. TELUS has indicated that it intends to remain our controlling shareholder for the foreseeable future.

Our dual-class structure may render our subordinate voting shares ineligible for inclusion in certain stock market indices, and thus adversely affect the trading price and liquidity of our subordinate voting shares.

        We cannot predict whether our dual-class structure will result in a lower or more volatile market price of our subordinate voting shares, in negative publicity or other adverse consequences. Certain index providers have announced restrictions on including companies with multi-class share structures in certain of their indices. For example, S&P Dow Jones has changed its eligibility criteria for inclusion of shares of public companies on the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P Composite 1500, to exclude companies with multiple classes of shares. As a result, our dual-class structure may prevent the inclusion of our subordinate voting shares in such indices, and

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mutual funds, exchange-traded funds and other investment vehicles that attempt to passively track these indices will not be able to invest in our subordinate voting shares, each of which could adversely affect the trading price and liquidity of our subordinate voting shares. In addition, several shareholder advisory firms have announced their opposition to the use of multiple class structure and our dual-class structure may cause shareholder advisory firms to publish negative commentary about our corporate governance, in which case the market price and liquidity of the subordinate voting shares could be adversely affected.

Upon the listing of our subordinate voting shares, we will be a controlled company within the meaning of the listing requirements of the NYSE and, as a result, will qualify for, and intend to rely on, exemptions from certain corporate governance requirements; you will not have the same protections afforded to shareholders of companies that are subject to such requirements.

        TELUS will continue to control a majority of the combined voting power in our company after completion of this offering, which means we will qualify as a controlled company within the meaning of the corporate governance standards of the NYSE. We expect to elect to be treated as a controlled company. Under these rules we may elect not to comply with certain corporate governance requirements, including the requirements that, within one year of the date of the listing of our subordinate voting shares:

    we have a board of directors that is composed of a majority of independent directors, as defined under the NYSE listing requirements;

    we have a compensation committee that is composed entirely of independent directors; and

    we have a nominating and governance committee that is composed entirely of independent directors.

We expect to rely on the NYSE controlled company provisions, which means we do not expect to have a board of directors that is composed of a majority of independent directors, nor will our human resources and governance and nominating committees be composed entirely of independent directors for the foreseeable future.

If TELUS sells a controlling interest in us to a third party in a private transaction, we may become subject to the control of a presently unknown third party.

        Following the completion of this offering, TELUS will continue to own a controlling interest in our company. TELUS will have the ability, should it choose to do so, to sell its controlling interest in us in a privately negotiated transaction, which, if sufficient in size, could result in a change of control of our company. Such a transaction could occur without triggering the rights under the Coattail Agreement (as defined in "Description of Share Capital—Take Over Bid Protection") and may occur even if the multiple voting shares are converted into subordinate voting shares.

        If TELUS privately sells its controlling interest in our company, we may become subject to the control of a presently unknown third party. Such third party may have conflicts of interest with those of other shareholders. In addition, if TELUS sells a controlling interest in our company to a third party, our future indebtedness may be subject to acceleration and our other commercial agreements and relationships could be impacted, all of which may adversely affect our ability to run our business as described herein and may have a material adverse effect on our business, financial performance, financial condition and cash flows.

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As a foreign private issuer, we are not subject to certain U.S. securities law disclosure requirements that apply to a domestic U.S. issuer, which may limit the information publicly available to our shareholders.

        As a foreign private issuer we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act and therefore there may be less publicly available information about us than if we were a U.S. domestic issuer. For example, we are not subject to the proxy rules in the United States and disclosure with respect to our annual meetings will be governed by Canadian requirements. In addition, our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder. Therefore, our shareholders may not know on a timely basis when our officers, directors and principal shareholders purchase or sell our securities.

        We will be exempt from Regulation FD, which prohibits issuers from making selective disclosures of material non-public information. While we will comply with the corresponding requirements relating to proxy statements and disclosure of material non-public information under Canadian securities laws, these requirements differ from those under the Exchange Act and Regulation FD, and holders of our subordinate voting shares should not expect to receive the same information at the same time as such information is provided to U.S. domestic companies. Additionally, we will have four months after the end of each fiscal year to file our annual report with the SEC and will not be required under the Exchange Act to file or furnish quarterly reports with the SEC as promptly as U.S. domestic companies whose securities are registered under the Exchange Act.

        Additionally, as a foreign private issuer, we are not required to file or furnish quarterly and current reports with respect to our business and financial performance. Following this offering, we intend to submit, on a quarterly basis, interim financial data to the SEC under cover of the SEC's Form 6-K. Furthermore, as a foreign private issuer, we intend to take advantage of certain provisions in the NYSE listing requirements that allow us to follow Canadian law for certain governance matters. See "Management—Corporate Governance".

If you purchase subordinate voting shares in this offering, you will suffer immediate and substantial dilution of your investment.

        The initial public offering price of our subordinate voting shares is substantially higher than the net tangible book value per subordinate voting share. Therefore, if you purchase our subordinate voting shares in this offering, you will pay a price per share that substantially exceeds our pro forma net tangible book deficit per share after the closing of this offering. Based on an assumed initial public offering price of $24.00 per share, the midpoint of the price range set forth on the cover page of this prospectus, you will experience immediate dilution of $28.92 per subordinate voting share, representing the difference between our pro forma net tangible book value per subordinate voting share after giving effect to this offering and the initial public offering price.

        We also have a number of outstanding options to purchase subordinate voting shares with exercise prices that are below the estimated initial public offering price of our subordinate voting shares. To the extent that these options are exercised, you will experience further dilution. See "Dilution" for more detail.

We cannot assure you that a market will develop for our subordinate voting shares or what the price of our subordinate voting shares will be. Investors may not be able to resell their subordinate voting shares at or above the initial public offering price.

        Before this offering, there was no public trading market for our subordinate voting shares, and we cannot assure you that one will develop or be sustained after this offering. Any delay in the commencement of trading of our subordinate voting shares on the NYSE or the TSX would impair the liquidity of the market for subordinate voting shares and make it more difficult for holders to sell their

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subordinate voting shares. If an active market does not develop or is not sustained, it may be difficult for you to sell your subordinate voting shares. This may affect the pricing of the subordinate voting shares in the secondary market, the transparency and availability of trading prices, the liquidity of the subordinate voting shares and the extent of regulation applicable to us. We cannot predict the prices at which our subordinate voting shares will trade. The initial public offering price for our subordinate voting shares will be determined through negotiations between us, the selling shareholders and the underwriters and may not bear any relationship to the market price at which our subordinate voting shares will trade after the closing of this offering or to any other established criteria of the value of our business. It is possible that, in future quarters, our operating results may be below the expectations of securities analysts and investors. As a result of these and other factors, the price of our subordinate voting shares may decline, possibly materially.

Our operating results and share price may be volatile, and the market price of our subordinate voting shares after this offering may drop below the price you pay.

        Our quarterly operating results are likely to fluctuate in the future in response to numerous factors, many of which are beyond our control, including each of the risks set forth in this section. In addition, securities markets worldwide have experienced, and are likely to continue to experience, significant price and volume fluctuations. This market volatility, as well as general natural, economic, market or political conditions, could subject the market price of our subordinate voting shares to price fluctuations regardless of our operating performance. Our operating results and the trading price of our subordinate voting shares may fluctuate in response to various factors, including the risks described above.

        These and other factors, many of which are beyond our control, may cause our operating results and the market price and demand for our subordinate voting shares to fluctuate substantially. Fluctuations in our quarterly operating results could limit or prevent investors from readily selling their subordinate voting shares and may otherwise negatively affect the market price and liquidity of subordinate voting shares. In addition, in the past, when the market price of a stock has been volatile, holders of that stock have sometimes instituted securities class action litigation against the company that issued the shares. If any of our shareholders brought a lawsuit against us, we could incur substantial costs defending the lawsuit. Such a lawsuit could also divert the time and attention of our management from our business, which could significantly harm our profitability and reputation. We may also decide to settle lawsuits on unfavorable terms. Furthermore, during the course of litigation, there could be negative public announcements of the results of hearings, motions or other interim proceedings or developments, which could have a negative effect on the market price of our subordinate voting shares.

A significant portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future. This could cause the market price of our subordinate voting shares to drop significantly, even if our business is doing well.

        Sales of a substantial number of our subordinate voting shares in the public market, or the perception in the market that the holders of a large number of subordinate voting shares or securities convertible into subordinate voting shares intend to sell their subordinate voting shares, could reduce the market price of our subordinate voting shares. Following the consummation of this offering, shares that are not being sold in this offering held by certain of our directors, executive officers and by TELUS and Baring will be subject to a lock-up period provided under lock-up agreements executed in connection with this offering described in "Underwriting" and restricted from immediate resale under U.S. federal securities laws and, in certain cases, Canadian securities laws as described in "Shares Eligible for Future Sale". All of these shares will, however, be able to be resold after the expiration of the lock-up period, as well as pursuant to customary exceptions thereto or upon the waiver of the

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applicable lock-up agreement by certain of the underwriters, subject to any restrictions imposed on sales under applicable securities laws as described under "Shares Eligible for Future Sale".

        In addition, after this offering, up to 3,008,781 subordinate voting shares may be issued upon exercise of outstanding share options and 23,980,011 subordinate voting shares will be reserved for future issuance under the compensation plan we expect to adopt in connection with the offering. Once we register these subordinate voting shares, they can be freely sold in the public market upon issuance, subject to the terms of the lock-up agreements. Upon effectiveness of this registration statement, subject to the satisfaction of applicable exercise periods and the expiration or waiver of the lock-up agreements referred to above, the subordinate voting shares issued upon exercise of outstanding share options will be available for immediate resale in the United States in the open market. Additionally, TELUS and Baring, as holders of an aggregate of 223,728,993 of our multiple voting shares (218,728,993 if the underwriters' over-allotment option is exercised in full), will, upon completion of this offering, be entitled, under a registration rights agreement we will enter into with them, to certain rights with respect to the registration of the sale of the subordinate voting shares held by them or issuable upon conversion of their multiple voting shares. TELUS and Baring are entitled to convert their multiple voting shares into subordinate voting shares at any time. See "Certain Relationships and Related Party Transactions—Our Relationship with TELUS and Baring—Registration Rights Agreement".

        As restrictions on resale end, the market price of our subordinate voting shares could decline if the holders of currently restricted subordinate voting shares sell them or are perceived by the market as intending to sell them. Further, we cannot predict the size of future issuances of our subordinate voting shares or the effect, if any, that future issuances and sales of subordinate voting shares will have on the market price of our subordinate voting shares.

We have no current plans to pay regular cash dividends on our subordinate voting shares following this offering and, as a result, you may not receive any return on investment unless you sell your subordinate voting shares for a price greater than that which you paid for it.

        We do not anticipate paying any regular cash dividends on our subordinate voting shares following this offering. Any decision to declare and pay dividends in the future will be made at the discretion of our board of directors and will depend on, among other things, our financial performance, financial condition, cash requirements, contractual restrictions and other factors that our board of directors may deem relevant. In addition, our ability to pay dividends is, and may be, limited by covenants of existing and any future outstanding indebtedness we or our subsidiaries incur. Therefore, any return on investment in our subordinate voting shares is solely dependent upon the appreciation of the price of our subordinate voting shares on the open market, which may not occur. See "Dividend Policy" for more detail.

Our articles, and certain Canadian legislation contain provisions that may have the effect of delaying or preventing a change in control, limit attempts by our shareholders to replace or remove our current directors and affect the market price of our subordinate voting shares.

        Certain provisions of our articles, together or separately, could discourage potential acquisition proposals, delay or prevent a change in control and limit the price that certain investors may be willing to pay for our subordinate voting shares. For instance, our articles to be effective upon completion of this offering will contain provisions that establish certain advance notice procedures for nomination of candidates for election as directors at shareholders' meetings. A non-Canadian must file an application for review with the minister responsible for the Investment Canada Act and obtain approval of the Minister prior to acquiring control of a "Canadian business" within the meaning of the Investment Canada Act, where prescribed financial thresholds are exceeded. Furthermore, limitations on the ability to acquire and hold our subordinate voting shares and multiple voting shares may be imposed by the

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Competition Act (Canada). This legislation permits the Commissioner of Competition to review any acquisition or establishment, directly or indirectly, including through the acquisition of shares, of control over or of a significant interest in us. Otherwise, there are no limitations either under the laws of Canada or British Columbia, or in our articles on the rights of non-Canadians to hold or vote our subordinate voting shares and multiple voting shares. Any of these provisions may discourage a potential acquirer from proposing or completing a transaction that may have otherwise presented a premium to our shareholders. See "Description of Share Capital—Certain Important Provisions of Our Articles and the BCBCA".

Because we are a corporation incorporated in British Columbia and some of our directors and officers are residents of Canada, it may be difficult for investors in the United States to enforce civil liabilities against us based solely upon the federal securities laws of the United States. Similarly, it may be difficult for Canadian investors to enforce civil liabilities against our directors and officers residing outside of Canada.

        We are a corporation incorporated under the laws of the Province of British Columbia with our principal place of business in Vancouver, Canada. Some of our directors and officers and some of the auditors or other experts named herein are residents of Canada and all or a substantial portion of our assets and those of such persons are located outside the United States. Consequently, it may be difficult for U.S. investors to effect service of process within the United States upon us or our directors or officers or such auditors who are not residents of the United States, or to realize in the United States upon judgments of courts of the United States predicated upon civil liabilities under the Securities Act of 1933, as amended (the "Securities Act"). Investors should not assume that Canadian courts: (1) would enforce judgments of U.S. courts obtained in actions against us or such persons predicated upon the civil liability provisions of the U.S. federal securities laws or the securities or blue sky laws of any state within the United States or (2) would enforce, in original actions, liabilities against us or such persons predicated upon the U.S. federal securities laws or any such state securities or blue sky laws.

        Similarly, some of our directors and officers are residents of countries other than Canada and the assets of such persons may be located outside of Canada. As a result, it may be difficult for Canadian investors to initiate a lawsuit within Canada against these non-Canadian residents, and it may be difficult to realize upon or enforce in Canada any judgment of a court of Canada against these non-Canadian residents since a substantial portion of the assets of such persons may be located outside of Canada. In addition, it may not be possible for Canadian investors to collect from these non-Canadian residents on judgments obtained in courts in Canada predicated on the civil liability provisions of securities legislation of certain of the provinces and territories of Canada. It may also be difficult for Canadian investors to succeed in a lawsuit in the United States, based solely on violations of Canadian securities laws.

There could be adverse tax consequences for our shareholders in the United States if we are a passive foreign investment company.

        Based on the Company's income, assets and business activities, including the receipt and application of the proceeds of the issue and sale of the subordinate voting shares, the Company does not believe that it was a "passive foreign investment company" (a "PFIC") for its 2019 taxable year and the Company expects that it will not be classified as a PFIC for U.S. federal income tax purposes for its current taxable year or in the near future. The determination of PFIC status is made annually at the end of each taxable year and is dependent upon a number of factors, some of which are beyond the Company's control, including the relative values of the Company's assets and its subsidiaries, and the amount and type of their income. As a result, there can be no assurance that the Company will not be a PFIC in 2020 or any subsequent year or that the IRS will agree with the Company's conclusion regarding its PFIC status and would not successfully challenge our position. If we are a PFIC for any

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taxable year during which a U.S. person holds our subordinate voting shares, such U.S. person may suffer certain adverse federal income tax consequences, including the treatment of gains realized on the sale of subordinate voting shares as ordinary income, rather than as capital gain, the loss of the preferential rate applicable to dividends received on subordinate voting shares by individuals who are U.S. persons, the addition of interest charges to the tax on such gains and certain distributions and increased U.S. federal income tax reporting requirements. If, contrary to current expectations, we were a PFIC for U.S. federal income tax purposes, certain elections (such as a mark-to-market election or qualified electing fund election) may be available to U.S. shareholders that may mitigate some of these adverse U.S. federal income tax consequences. United States purchasers of our subordinate voting shares are urged to consult their tax advisors concerning United States federal income tax consequences of holding our subordinate voting shares if we are considered to be a PFIC. See the discussion under "Certain U.S. Federal Income Tax Considerations for U.S. Persons—PFIC Rules".

Our articles will provide that any derivative actions, actions relating to breach of fiduciary duties and other matters relating to our internal affairs will be required to be litigated in Canada or the United States, as the case may be, which could limit your ability to obtain a favorable judicial forum for disputes with us.

        Our articles, to be effective upon completion of this offering, will include a forum selection provision that provides that, unless we consent in writing to the selection of an alternative forum, the Supreme Court of British Columbia, Canada and the appellate courts therefrom, will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf; (ii) any action or proceeding asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, or other employees to us; (iii) any action or proceeding asserting a claim arising pursuant to any provision of the Business Corporations Act (British Columbia) (the "BCBCA") or our articles; or (iv) any action or proceeding asserting a claim otherwise related to the relationships among us, our affiliates and their respective shareholders, directors and/or officers, but excluding claims related to our business or such affiliates. The forum selection provision will also provide that our securityholders are deemed to have consented to personal jurisdiction in the Province of British Columbia and to service of process on their counsel in any foreign action initiated in violation of the foregoing provisions. This forum selection provision will not apply to any causes of action arising under the Securities Act, or the Exchange Act. The Securities Act provides that both federal and state courts have concurrent jurisdiction over suits brought to enforce any duty or liability under the Securities Act or the rules and regulations thereunder, and the Exchange Act provides that federal courts have exclusive jurisdiction over suits brought to enforce any duty or liability under the Exchange Act or the rules and regulations thereunder. Unless we consent in writing to the selection of an alternative forum, the United States District Court for the Southern District of New York (or, if the United States District Court for the Southern District of New York lacks subject matter jurisdiction over a particular dispute, the state courts in New York County, New York) shall be the sole and exclusive forum for resolving any complaint filed in the United States asserting a cause of action arising under the Securities Act and the Exchange Act. Investors cannot waive, and accepting or consenting to this forum selection provision does not represent you are waiving compliance with U.S. federal securities laws and the rules and regulations thereunder. See "Description of Share Capital—Certain Important Provisions of our Articles and the BCBCA—Forum Selection".

        The enforceability of similar forum selection provisions in other companies' organizational documents, however, has been challenged in legal proceedings in the United States, and it is possible that a court could find this type of provision to be inapplicable, unenforceable, or inconsistent with other documents that are relevant to the filing of such lawsuits. If a court were to find the forum selection provision to be effective upon completion of this offering to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions. If upheld, the forum selection provision may impose additional litigation costs on shareholders in pursuing any such claims. Additionally, the forum selection provision, if upheld, may limit our

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shareholders' ability to bring a claim in a judicial forum that they find favorable for disputes with us or our directors, officers or employees, which may discourage the filing of lawsuits against us and our directors, officers and employees, even though an action, if successful, might benefit our shareholders. The courts of the Province of British Columbia and the United States District Court for the Southern District of New York may also reach different judgments or results than would other courts, including courts where a shareholder considering an action may be located or would otherwise choose to bring the action, and such judgments may be more or less favorable to us than to our shareholders.

TELUS International (Cda) Inc. is a holding company and, as such, it depends on its subsidiaries for cash to fund its operations and expenses, including future dividend payments, if any.

        As a holding company, our principal source of cash flow will be distributions from our operating subsidiaries. Therefore, our ability to fund and conduct our business, service our debt and pay dividends, if any, in the future will principally depend on the ability of our subsidiaries to generate sufficient cash flow to make upstream cash distributions to us. Our subsidiaries are separate legal entities, and although they are wholly-owned and controlled by us, they have no obligation to make any funds available to us, whether in the form of loans, dividends or otherwise. Claims of any creditors of our subsidiaries generally will have priority as to the assets of such subsidiary over our claims and claims of our creditors and shareholders. To the extent the ability of our subsidiaries to distribute dividends or other payments to us is limited in any way, our ability to fund and conduct our business, service our debt and pay dividends, if any, could be harmed.

If securities or industry analysts do not begin to publish or cease publishing research or reports about us, our business or our market, or if they change their recommendations regarding our subordinate voting shares, the price and trading volume of our subordinate voting shares could decline.

        The trading market for our subordinate voting shares is expected to be influenced by the research and reports that industry or securities analysts publish about us, our business, our market and our competitors. If any of the analysts who cover us or may cover us in the future change their recommendation regarding our subordinate voting shares adversely, or provide more favorable relative recommendations about our competitors, the price of our subordinate voting shares could decline. If securities or industry analysts fail to regularly publish reports on us, we could fail to gain, or if any analyst who covers us or may cover us in the future were to cease coverage of our company, we could lose visibility in the financial markets, which in turn could cause the price or trading volume of our subordinate voting shares to decline.

Our organizational documents will permit us to issue an unlimited number of subordinate voting shares, multiple voting shares and preferred shares without seeking approval of the holders of subordinate voting shares.

        Our articles will permit us to issue an unlimited number of subordinate voting shares, multiple voting shares and preferred shares. We anticipate that we may, from time to time, issue additional subordinate voting shares in the future in connection with acquisitions or to raise capital for general corporate or other purposes.

        One of the reasons for our initial public offering is to provide us with the ability to use our subordinate voting shares in the future to fund acquisitions to grow our business. Subject to the requirements of the NYSE and the TSX, we will not be required to obtain the approval of the holders of subordinate voting shares for the issuance of additional subordinate voting shares. Although the rules of the TSX generally prohibit us from issuing additional multiple voting shares, there may be, with the approval of TELUS, certain circumstances where additional multiple voting shares may be issued, including with applicable regulatory, stock exchange and shareholder approval. Any further issuances of subordinate voting shares or multiple voting shares will result in immediate dilution to

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existing shareholders and may have an adverse effect on the value of their shareholdings. Additionally, any further issuances of multiple voting shares will significantly lessen the combined voting power of our subordinate voting shares due to the ten-to-one (10-to-1) voting ratio between our multiple voting shares and subordinate voting shares. TELUS and Baring, as holders of our multiple voting shares, may also elect at any time or, in certain circumstances be required to convert their multiple voting shares into subordinate voting shares, which would increase the number of subordinate voting shares. See "Certain Relationships and Related Party Transactions".

        Our articles to be in effect at the time of the completion of this offering will also permit us to issue an unlimited number of preferred shares, issuable in series and, subject to the requirements of the BCBCA, having such designations, rights, privileges, restrictions and conditions, including dividend and voting rights, as our board of directors may determine and which may be superior to those of the subordinate voting shares. The issuance of preferred shares could, among other things, have the effect of delaying, deferring or preventing a change in control of the Company and might adversely affect the market price of our subordinate shares. We have no current or immediate plans to issue any preferred shares following the completion of this offering. Subject to the provisions of the BCBCA and the applicable requirements of the NYSE and the TSX, we will not be required to obtain the approval of the holders of subordinate voting shares for the issuance of preferred shares or to determine the maximum number of shares of each series, create an identifying name for each series and attach such special rights or restrictions as our board of directors may determine. See "Description of Share Capital".

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains forward-looking statements concerning our business, operations and financial performance and condition, as well as our plans, objectives and expectations for our business operations and financial performance and condition. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as "aim", "anticipate", "assume", "believe", "contemplate", "continue", "could", "due", "estimate", "expect", "goal", "intend", "may", "objective", "plan", "predict", "potential", "positioned", "seek", "should", "target", "will", "would" and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology.

        These forward-looking statements include, but are not limited to, statements about:

    our ability to execute our growth strategy, including by expanding services offered to existing clients and attracting new clients;

    our ability to maintain our corporate culture and competitiveness of our service offerings;

    our ability to attract and retain talent;

    the pending review by CFIUS of our acquisition of Lionbridge AI;

    our ability to integrate, and realize the benefits of, our acquisitions of CCC, MITS and Lionbridge AI;

    the relative growth rate and size of our target industry verticals;

    our relationship with TELUS following the consummation of this offering;

    our projected operating and capital expenditure requirements; and

    the impact of the COVID-19 pandemic on our business, financial condition, financial performance and liquidity.

        These factors should not be construed as exhaustive and should be read with the other cautionary statements in this prospectus. These forward-looking statements are based on our current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management's beliefs and assumptions, and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this prospectus may turn out to be inaccurate. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under "Risk Factors" and elsewhere in this prospectus. Potential investors are urged to consider these factors carefully in evaluating the forward-looking statements. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. These forward-looking statements speak only as at the date of this prospectus. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC and the Canadian securities regulatory authorities, after the date of this prospectus. See "Where You Can Find More Information".

        This prospectus contains estimates, projections, market research and other information concerning our industry, our business, and the markets for our services. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are

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assumed in this information. Unless otherwise expressly stated, we obtained this industry, business, market and other data from our own internal estimates and research as well as from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry and general publications, government data and similar sources.

        In addition, assumptions and estimates of our and our industry's future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in "Risk Factors". These and other factors could cause our future performance to differ materially from our assumptions and estimates.

        Any references to forward-looking statements in this prospectus include forward-looking information within the meaning of applicable Canadian securities laws.

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INDUSTRY AND MARKET DATA

        This prospectus includes market data and forecasts with respect to current and projected market sizes for digital transformation of customer experience systems and digital customer experience management. Although we are responsible for all of the disclosure contained in this prospectus, in some cases we rely on and refer to market data and certain industry forecasts that were obtained from third party surveys, market research, consultant surveys, publicly available information and industry publications and surveys that we believe to be reliable. Unless otherwise indicated, all market and industry data and other statistical information and forecasts contained in this prospectus are based on independent industry publications, reports by market research firms or other published independent sources and other externally obtained data that we believe to be reliable.

        The Everest Group report (Customer Experience Management (CXM) Annual Report 2019: Delivering Next-Generation Contract Center Services, Everest Group, September 2019) and its content described and cited herein (the "Everest Group Report") represents research opinions or viewpoints, not representations or statements of fact. Unless otherwise specifically stated in the Everest Group Report, the Everest Group Report has not been updated or revised since the original publication date of the Everest Group Report. The opinions expressed in the Everest Group Report are subject to change without notice. Everest Group disclaims all representations and warranties, expressed or implied, with respect to the Everest Group Report, including any warranties of merchantability or fitness for a particular purpose, accuracy or completeness of information. Nothing in the Everest Group Report is considered part of this prospectus.

        Information used in preparing the Everest Group Report may have been obtained from or through the public, the companies in the Everest Group Report, or third-party sources. Everest Group assumes no responsibility for independent verification of such information and has relied on such to be complete and accurate in all respects. To the extent such information includes estimates or forecasts, Everest Group has assumed that such estimates and forecasts have been properly prepared.

        Some market and industry data, and statistical information and forecasts, are also based on management's estimates. Any such market data, information or forecast may prove to be inaccurate because of the method by which we obtain it or because it cannot always be verified with complete certainty given the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties, including those discussed under the captions "Risk Factors" and "Special Note Regarding Forward-Looking Statements".

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USE OF PROCEEDS

        We estimate that the net proceeds to us from our issuance and sale of 21,929,824 subordinate voting shares in this offering will be approximately $493.9 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. This estimate assumes an initial public offering price of $24.00 per subordinate voting share, the midpoint of the price range set forth on the cover page of this prospectus. We will not receive any additional proceeds if the underwriters exercise their over-allotment option to purchase additional subordinate voting shares from Baring.

        We will not receive any proceeds from the sale of subordinate voting shares in this offering by the selling shareholders. After deducting underwriting discounts and commissions, the selling shareholders will receive approximately $262.1 million of net proceeds from this offering (or approximately $377 million if the underwriters exercise their over-allotment option in full). See "Principal and Selling Shareholders".

        Each $1.00 increase (decrease) in the assumed initial public offering price of $24.00 per subordinate voting share, the midpoint of the estimated price range set forth on the cover page of this prospectus, would increase (decrease) our net proceeds by approximately $21 million, assuming the number of subordinate voting shares offered by us, as set forth on the cover page of this prospectus, remains the same, after deducting the estimated underwriting discounts and estimated offering expenses payable by us. Each increase (decrease) of 1.0 million subordinate voting shares in the number of subordinate voting shares offered by us would increase (decrease) the net proceeds from this offering by approximately $23 million, assuming the assumed initial public offering price remains the same, after deducting the estimated underwriting discounts and estimated offering expenses payable by us. The information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at pricing. Any increase or decrease in the net proceeds would not change our intended use of proceeds.

        We intend to use the net proceeds from this offering to repay outstanding borrowings under one or more of the revolving credit facilities or the term loan facilities of our credit agreement and for general corporate purposes. As at September 30, 2020, we had $351.5 million of borrowings outstanding under the revolving credit facilities and $585.0 million outstanding under the term loan facilities of our credit agreement. In connection with the acquisition of Lionbridge AI, we made additional borrowings of $709.0 million under our credit agreement, of which $265.0 million was drawn on the term loan facilities, and the remainder on the revolving facilities. See "Description of Certain Indebtedness".

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DIVIDEND POLICY

        We have never declared or paid dividends on our subordinate voting shares. We currently intend to retain all available funds and any future earnings to support operations and to finance the growth and development of our business. As such, we do not intend to declare or pay cash dividends on our subordinate voting shares in the foreseeable future. Any future determination to pay dividends will be made at the discretion of our board of directors subject to applicable laws and will depend upon, among other factors, our financial performance, financial condition including leverage levels, contractual restrictions, capital requirements and merger and acquisition opportunities. Our future ability to pay cash dividends on our subordinate voting shares is currently limited by the terms of our credit agreement and may be limited by the terms of any future debt or preferred securities.

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CAPITALIZATION

        The following table sets forth our cash and cash equivalents and capitalization as at September 30, 2020:

    on an actual basis;

    on a pro forma basis giving effect to (i) the exercise by Baring of its option to purchase 1,070,253 shares of our Class B common shares for $66.5 million and the application of the proceeds to reduce indebtedness under the credit facility and (ii) the acquisition of Lionbridge AI, including (A) borrowings of $709.0 million under our credit agreement, of which $265.0 million was drawn on the term loan facilities, and the remainder on the revolving facilities and (B) the issuance of 1,678,242 Class A common shares to TELUS and 901,101 Class B common shares to Baring;

    on a pro forma as adjusted basis giving effect to (i) the pro forma items described immediately above and (ii) the Share Class Reclassification Transactions; and

    on a pro forma as further adjusted basis giving effect to (i) the pro forma items described immediately above, (ii) the issuance and sale of 21,929,824 subordinate voting shares by us in this offering at an assumed initial public offering price of 24.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and our receipt of the estimated net proceeds after deducting the underwriting discounts and estimated offering expenses payable by us (excluding the potential exercise by the underwriters of their over-allotment option) and (iii) the application of the net proceeds therefrom to repay outstanding borrowings under one or more revolving or term loan facilities of our credit agreement, as described in "Use of Proceeds".

        We financed our acquisition of Lionbridge AI with approximately $149.6 million in cash received from the issuance of 1,678,242 Class A common shares to TELUS, $80.4 million in cash received from the issuance of 901,101 Class B common shares to Baring and borrowings of $709.0 million under our credit agreement, of which $265.0 million was drawn on the term loan facilities, and the remainder on the revolving facilities.

        Actual data as at September 30, 2020 in the table below is derived from our unaudited condensed interim consolidated financial statements included in this prospectus. The pro forma data included in the table below is unaudited and is provided for illustrative purposes only.

        You should read this information together with our consolidated financial statements appearing elsewhere in this prospectus and the information set forth under the headings "Summary Historical

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Consolidated Financial and Other Data", "Use of Proceeds", and "Management's Discussion and Analysis of Financial Condition and Results of Operations".

 
  As at
September 30, 2020
($ in millions)
 
 
  Actual   Pro Forma   Pro Forma As
Adjusted
  Pro Forma As
Further
Adjusted
 

Cash and cash equivalents(1)

  $ 138.9   $ 138.9   $ 138.9   $ 138.9  

Total short-term debt

  $ 11.1   $ 11.1   $ 11.1   $ 11.1  

Long term debt

                         

Credit facility(2)

  $ 936.5   $ 1,579.0   $ 1,579.0   $ 1,085.1  

Deferred debt transaction costs

    (7.8 )   (11.3 )   (11.3 )   (11.3 )

Lease liabilities

    218.7     221.2     221.2     221.2  

Total long-term debt

    1,147.4     1,788.9     1,788.9     1,295.0  

Owners' equity:

                         

Class A common shares—unlimited shares authorized; 31,304,419 shares issued and outstanding, actual; 32,982,661 shares issued and outstanding, pro forma; no shares authorized, issued and outstanding, pro forma as adjusted and pro forma as further adjusted

    224.9     374.5          

Class B common shares—unlimited shares authorized; 16,282,910 shares issued and outstanding, actual; 18,254,264 shares issued and outstanding, pro forma; no shares authorized, issued and outstanding, pro forma as adjusted and pro forma as further adjusted

    312.2     459.1          

Class C common shares—unlimited shares authorized; 928,660 shares issued and outstanding, actual and pro forma; no shares authorized, issued and outstanding, pro forma as adjusted and pro forma as further adjusted

    50.7     50.7          

Class D common shares—unlimited shares authorized; 722,021 shares issued and outstanding, actual and pro forma; no shares authorized, issued and outstanding, pro forma as adjusted and pro forma as further adjusted

    20.0     20.0          

Class E common shares—unlimited shares authorized; 1,449,004 shares issued and outstanding, actual and pro forma; no shares authorized, issued and outstanding, pro forma as adjusted and pro forma as further adjusted

    90.0     90.0          

Share option awards

    1.6     1.6     1.6     1.6  

Subordinate Voting Shares—no shares authorized, issued and outstanding, actual and pro forma; 20,785,753 shares authorized, issued and outstanding, pro forma as adjusted; 42,715,577 shares authorized, issued and outstanding, pro forma as further adjusted

            110.2     679.4  

Multiple Voting Shares—no shares authorized, issued and outstanding, actual and pro forma; 235,132,502 shares authorized, issued and outstanding, pro forma as adjusted; 223,728,993 shares authorized, issued and outstanding pro forma as further adjusted

            884.1     841.2  

Share issuance cost

    (6.8 )   (6.8 )   (6.8 )   (30.5 )

Retained earnings

    11.5     11.5     11.5     11.5  

Accumulated other comprehensive income

    40.0     40.0     40.0     40.0  

Total owners' equity

    744.1     1,040.6     1,040.6     1,543.2  

Total capitalization

  $ 1,891.5   $ 2,829.5   $ 2,829.5   $ 2,838.2  

(1)
Includes cash and temporary investments, net.
(2)
As of December 31, 2020, there were approximately $1,568 million of borrowings outstanding.

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        The 42,715,577 subordinate voting shares issued and outstanding pro forma as further adjusted excludes:

    up to 3,008,781 subordinate voting shares issuable upon the exercise of U.S. dollar-denominated equity share option awards previously issued to certain of our executive officers and outstanding as of the date of this prospectus, at exercise prices ranging from $4.87 to $8.94, which includes 2,616,138 subordinate voting shares that are or will become exercisable upon the completion of this offering; and

    up to 23,980,011 subordinate voting shares issuable pursuant to the compensation plans we intend to adopt in connection with the offering.

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DILUTION

        If you invest in our subordinate voting shares in this offering, your interest will be diluted to the extent of the difference between the initial public offering price per subordinate voting share in this offering and the pro forma net tangible book value per subordinate voting share after this offering. Dilution results from the fact that the initial public offering price per subordinate voting share is substantially in excess of the net tangible book value per share (which includes both our subordinate voting shares and multiple voting shares) attributable to the existing shareholders for our presently outstanding shares. Our net tangible book value per share represents the amount of our total tangible assets (total assets less intangible assets) less total liabilities, divided by the number of shares issued and outstanding. The presentation in this section gives effect to the Share Class Reclassification Transactions as if they had occurred on September 30, 2020.

        As at September 30, 2020, we had a historical net tangible book value of $(906.4) million, or $(3.97) per share, based on 228,091,563 shares outstanding as at such date. As of September 30, 2020, we had pro forma net tangible book value of $(1,805.5) million, or $(7.38) per share, based on 244,514,745 shares outstanding after, in each case, giving effect to the issuance of common shares to Baring on October 19, 2020 in connection with its exercise of a previously issued option, the acquisitions of CCC and Lionbridge AI and the Share Class Reclassification Transactions. Dilution is calculated by subtracting net tangible book value per subordinate voting share from the assumed initial public offering price of $24.00 per subordinate voting share, which is the midpoint of the price range set forth on the cover page of this prospectus.

        Investors participating in this offering will incur immediate and substantial dilution. After September 30, 2020, after giving effect to the sale of subordinate voting shares in this offering, assuming an initial public offering price of $24.00 per subordinate voting share (the midpoint of the price range set forth on the cover page of this prospectus), less the underwriting discounts and estimated offering expenses payable by us, our pro forma net tangible book value as at September 30, 2020, would have been approximately $(1,311.6) million, or $(4.92) per share. This amount represents an immediate increase in net tangible book value of $2.46 per share to the existing shareholders and immediate dilution of $28.92 per subordinate voting share to investors purchasing our subordinate voting shares in this offering.

        The following table illustrates this dilution on a per subordinate voting share basis:

Assumed initial public offering price per subordinate voting share

        $ 24.00  

Pro forma net tangible book value per share as at September 30, 2020

  $ (7.38 )      

Increase in pro forma net tangible book value per share attributable to new investors in this offering (subordinate voting shares sold by us)

    2.46        

Pro forma net tangible book value per share after this offering

                 (4.92 )

Dilution in net tangible book value per subordinate voting share to new investors in this offering

        $ 28.92  

        Each $1.00 increase in the assumed initial public offering price of $24.00 per subordinate voting share, the midpoint of the estimated price range set forth on the cover page of this prospectus, would increase our pro forma net tangible book value per subordinate voting share after this offering by $0.08 per subordinate voting share and would decrease the dilution to new investors by $0.08 per subordinate voting share, assuming the number of subordinate voting shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and estimated offering expenses payable by us. Similarly, each $1.00 decrease in the assumed initial public offering price of $24.00 per subordinate voting share would decrease our pro forma net tangible book value per subordinate voting share after this offering by $0.08 per subordinate voting share and increase the dilution to new investors by $0.08 per subordinate voting share, assuming the number of

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subordinate voting shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and estimated offering expenses payable by us. Each increase of 1.0 million subordinate voting shares in the number of subordinate voting shares offered by us would increase the pro forma net tangible book value by $0.10 per subordinate voting share and decrease the dilution to new investors by $0.10 per subordinate voting share, assuming the assumed initial public offering price remains the same and after deducting the estimated underwriting discounts and estimated offering expenses payable by us. Similarly, each decrease of 1.0 million subordinate voting shares in the number of subordinate voting shares offered by us would decrease the pro forma net tangible book value by $0.10 per subordinate voting share and increase the dilution to new investors by $0.10 per subordinate voting share, assuming the assumed initial public offering price remains the same and after deducting the estimated underwriting discounts and estimated offering expenses payable by us.

        The following table summarizes, as at September 30, 2020, on the pro forma basis described above, the aggregate number of subordinate voting shares purchased from us, the total consideration paid to us, and the average price per subordinate voting share paid by purchasers of such subordinate voting shares and by new investors purchasing subordinate voting shares in this offering.

 
  Shares
Purchased
   
   
   
 
 
  Total Consideration   Average Price
Per
Subordinate
Voting Share
 
 
  Number   Percent   Amount   Percent  
 
  ($ in thousands, except per share amounts)
 

Existing shareholders(1)

    244,514,745     91.8 % $ 994,300     65.4 % $ 4.07  

New investors(1)

    21,929,824     8.2 % $ 526,316     34.6 % $ 24.00  

Total

    266,444,569     100.0 % $ 1,520,616     100.0 % $ 5.71  

(1)
Does not give effect to the sale of 11,403,509 subordinate voting shares by the selling shareholders in this offering or to the exercise of the underwriters of their over-allotment option.

        After giving effect to the sale of 11,403,509 subordinate voting shares by the selling shareholders in this offering, the percentage of our subordinate voting shares held by existing shareholders would be 22.0% and the percentage of our subordinate voting shares held by new investors would be 78.0%. If the underwriters were to fully exercise their over-allotment option to purchase an additional 5,000,000 subordinate voting shares from the selling shareholders, the percentage of our subordinate voting shares held by existing shareholders would be 19.7%, and the percentage of our subordinate voting shares held by new investors would be 80.3%.

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CCC

Overview of CCC

        On January 31, 2020, through the acquisition of a predecessor entity to Triple C Holding, we completed our acquisition of CCC for cash consideration of $873.0 million. CCC is a leading provider of higher-value-added business services with a focus on trust and safety, including content moderation. We have consolidated CCC in our financial results since the closing of the acquisition. On December 16, 2020, Triple C Holding was merged into TELUS International Germany GmbH with TELUS International Germany GmbH as the surviving entity.

        The following is a summary of financial results for CCC for the years ended December 31, 2019 and 2018, which are financial periods prior to our acquisition of CCC. You should read the following discussion together with the audited annual consolidated financial statements and related notes for CCC for such periods, which are included in this prospectus. You should also review the discussion and analysis of our financial condition and financial performance, which is included in "Management's Discussion and Analysis of Financial Condition and Results of Operations," and our unaudited condensed interim consolidated financial statements for the nine-month period ended September 30, 2020, which consolidate CCC from the date of the acquisition. You should also review our unaudited pro forma condensed combined consolidated financial information, which is included in this prospectus, which give effect to the acquisition of CCC by us as of January 1, 2019. See "Unaudited Pro Forma Condensed Combined Consolidated Financial Information".

        Operating revenues of CCC increased by €75.3 million, or 31.1%, to €317.9 million in 2019 due to growth in revenue from clients, including, in particular, revenues derived from a new client acquired at the end of 2017. Operating expenses in 2019 correspondingly increased by €44.2 million, or 21.4%, from 2018 as a result of increased employee benefits expenses resulting from additional personnel required to service the incremental growth in revenue. Employee benefits expense as a percentage of revenue was 62.8% in 2019 versus 63.3% in the prior year; this is due to the increase in the client mix towards higher margin accounts. Net income increased from €14.1 million in 2018 to €40.0 million in 2019, representing a 183.4% increase year-over-year.

        Total assets in 2019 increased by €8.7 million, or 2.5%, from 2018 principally as a result of increases in cash and cash equivalents, offset by amortization of intangible assets. Current liabilities in 2019 increased to €68.9 million from €44.6 million, or by 54.5%, from 2018 principally due to an increase in income and other taxes payable resulting from higher net income. Total liabilities decreased from €278.1 million in 2018 to €247.2 million in 2019, or by 11.1%, representing a decrease in long-term debt of €50.7 million, which was offset in part by the increase in income taxes payable noted above.

        Cash provided by operating activities increased from €47.0 million in 2018 to €87.9 million in 2019 due to an increase in net income adjusted for non-cash expenses of €20.6 million plus a change in working capital of €20.3 million. Cash used by investing activities in 2019 decreased by €119.7 million to €6.1 million, or by 95%, resulting from the cash payments of €113.4 million in January 2018 used to acquire CCC. Cash provided by financing activities in 2019 was a net cash outflow of €58.1 million, as compared to a net cash inflow of €94.1 million in the prior year. The change in the cash from financing activities was due to a €168.7 million long term debt issuance and capital contributions of €52.9 mi