Notice of 2002 Annual and Special Meeting and Management … · 2016. 5. 5. · A: Georgeson...

Your vote counts!Do it now...It’s rewarding...Vote and you enter the prize pool!See Question No. 11 of the Management Proxy Circular for more details.

B Y M A I L , FA X O R I N P E R S O N

To vote by mail, complete the form and return it in the pre-addressed envelope.

Should you prefer to use the fax, please see Question No. 9 of theManagement Proxy Circular. For voting in person at the meeting,see Question No. 10.

Notice of 2002 Annual and Special Meetingand Management Proxy Circular

A NEW WAY TO PROVIDE VOTING INSTRUCTIONS

ON THE INTERNET

Most shareholders can now vote on the Internet. Your proxy formor voting instruction form holds the key: visit the website indi-cated on your form and use your Control Number and PIN Number.

B Y P H O N E ( no n - r e g i s ter e d holder s o n ly )

Check your voting instruction form.

You may be able to vote by phone your non-registered shares(e.g., your shares held through a bank, trust company, securitiesbroker or other nominee). See Question No. 22 of the ManagementProxy Circular.

T A B L E O F C O N T E N T S

Chairman and Chief Executive Officer’s letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

Notice of 2002 Annual and Special Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

Questions and Answers on Voting and Proxies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

Electronic Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Business to be Transacted at the Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Presentation of Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Election of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Appointment of Auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

Amendment to Articles of Incorporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Confirmation of By-Law One . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Other Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Nominees for Election as Directors and their Beneficial Ownership of Voting Securities . . . . . . . . . . . . . . . . .9

Directors’ and Officers’ Remuneration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Report on Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Shareholder Return Performance Graphs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

Executive Compensation Table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

Stock Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

Pension Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

Compensation of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20

Statement of Corporate Governance Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

Mandate of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Composition of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

Independence of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

Governance Information for Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

Board Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

Directors’ and Officers’ Liability Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

2003 Shareholder Proposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25

Schedule “A” – Special Resolution Authorizing an Amendment to BCE Inc.’s Articles of Incorporation . . . . .26

Schedule “B” – Resolution to Confirm By-Law One . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26

BCE Investor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29

1

Dear Shareholder:

You are invited to attend the Annual and Special Meeting of the shareholders of BCE Inc. which will be held at Place

Bonaventure, Exhibition Halls, 900, rue de La Gauchetière Ouest, Montréal, Québec on Wednesday, May 29, 2002, at

9:00 a.m. (Montréal Time).

The items of business to be acted upon are set forth in the Notice of 2002 Annual and Special Meeting and

Management Proxy Circular. This year, in addition to the usual business, you will be asked to vote on amendments to the

Articles of Incorporation and By-Laws of BCE.

Your participation in the affairs of the Corporation is important, regardless of the number of shares you hold.

This year, BCE is using its communications technology to facilitate the communication of your voting instructions, which

can be expressed either on the Internet, by mail, facsimile or in person. Whether you are unable to attend in person or

intend to be present at the meeting but nevertheless find it convenient to express your views in advance, BCE’s tech-

nology allows you all the flexibility you need to express your views. If your shares are not registered in your name but are

held in the name of a nominee, you may wish to consult the information on page 6 of the Management Proxy Circular with

respect to how to vote your shares.

Following the custom of past annual meetings, we will review with you the business and affairs of

the Corporation.

Sincerely yours,

J.C. Monty

Chairman and Chief Executive Officer

P.S. This Management Proxy Circular, as well as the BCE Inc. 2001 Annual Report and our quarterly financial information,

are posted on the BCE website (www.bce.ca), along with other information regarding BCE. Pay a visit and enroll to receive

shareholder communications electronically. If you cannot join us in person at our Annual and Special Meeting, take

advantage of the simultaneous webcast available on our website.

April 29, 2002

B C E I N C . 2 0 0 2 M A N A G E M E N T P R O X Y C I R C U L A R 3

QUESTIONS AND ANSWERS ON VOTING AND PROXIES

To ensure representation of your shares at the Annual and SpecialMeeting of BCE Inc. (“BCE” or the “Corporation”) to be held in Montréal,Québec on Wednesday, May 29, 2002 (the “Meeting”), PLEASE SELECTTHE MOST CONVENIENT WAY FOR YOU TO EXPRESS YOUR VOTING INSTRUC-TIONS (ON THE INTERNET, BY MAIL, FAX OR IN PERSON) AND FOLLOW THEINSTRUCTIONS. The following questions and answers provide guidanceon how to vote your shares. If you are not a registered shareholder(e.g., your shares are held through a bank, trust company, securi-ties broker of other nominee), please refer to Question No. 22 belowfor a description of the procedure to be followed.

1 . Q : W H O M C A N I C A LL I F I H AV E Q U E S T I O N S A B O U TT H E I N FO R M AT I O N C O N TA I N E D I N T H I S M A N A G E M E N TP R O X Y C I R C U L A R O R R E Q U I R E A S S I S TA N C E I NC O M PL E T I N G M Y P R O X Y FO R M ?

A : Georgeson Shareholder Communications Canada Inc.(“Georgeson”), our proxy solicitation agent, at 1-800-890-1037,for service in English, and at 1-888-890-2933, for service inFrench.

2 . Q : W H O I S S O LI C I T I N G M Y P R O X Y ?A: The Management of BCE. Solicitation of proxies will be primar-

ily by mail, supplemented by telephone or other contact, byemployees or agents of the Corporation at a nominal cost, andall costs thereof will be borne by the Corporation. TheCorporation has retained the services of Georgeson for thesolicitation of proxies in Canada and in the United States. Themaximum aggregate costs of Georgeson’s services are esti-mated to be $50,000.

3 . Q : W H AT A M I V OT I N G O N ?A : Four items: (1) the election of directors to the Board of

Directors of the Corporation until the close of the next annualmeeting, (2) the appointment of the auditors of theCorporation until the close of the next annual meeting, ( 3 ) aproposed amendment to the Articles of Incorporation of BCEand (4) the confirmation of By-Law One of BCE. Shares may bevoted for or withheld from voting on the election of directorsand the appointment of auditors. On other matters, you mayvote for or against the proposals. The Corporation’s Board ofDirectors and Management are recommending that share-holders vote FOR all four items.

4 . Q : W H O I S E N T I T L E D TO V OT E ?A : Common shareholders as at the close of business on April 5,

2002 or their duly appointed proxies will be entitled to attendthe Meeting or to register a vote.

As at March 30, 2002, 808,618,814 common shares of theCorporation are entitled to be voted at the Meeting.

5 . Q : H O W D O I V OT E ?A: There are two ways that you can vote your shares if you

are a registered shareholder: (1) by proxy or (2) in personat the Meeting.

There are three ways that you may vote by proxy: (1) onthe Internet (see Question No. 7), (2) by mail (see QuestionNo. 8) or (3) by fax (see Question No. 9).

If you wish to vote in person at the Meeting, do not com-plete or return the proxy form. Your vote will be taken andcounted at the Meeting. Returning a form of proxy in advancedoes not preclude you from attending the Meeting in person(see Question No. 10).

If you do not wish to attend the Meeting or do not wish tovote in person, your proxy will be voted for or against or with-held from voting in accordance with your instructions on theproxy. A proxy must be in writing and must be executed bythe shareholder or by the shareholder’s attorney authorizedin writing or, if the shareholder is a corporation or other legalentity, by an officer or attorney thereof duly authorized.

If your shares are registered in the name of a nominee,please see Question No. 22.

6 . Q : B Y W H E N M U S T I V OT E ?A : No later than 4:45 p.m. (Montréal Time) on Tuesday, May 28,

2002. All shares represented by proper proxy forms receivedby Computershare Trust Company of Canada (“Computershare”),BCE’s transfer agent prior to such time will be voted for oragainst or withheld from voting, in accordance with yourinstructions as specified in the proxy form, on any ballot thatmay be called at the Meeting.

M A N A G E M E N T P R O X Y C I R C U L A R D A T E D M A R C H 3 0 , 2 0 0 2 *

*Information as of March 30, 2002, except as otherwise indicated.

4 B C E I N C . 2 0 0 2 M A N A G E M E N T P R O X Y C I R C U L A R

7 . Q : H O W D O I G I V E V OT I N G I N S T R U C T I O N S O N T H EI N T E R N E T ?

A: Go to the following website: www.bce.ca. Enter your CONTROLNUMBER and PIN NUMBER (you will find these two numbers onthe enclosed proxy form). Follow instructions on the screen tocomplete, sign and return your form of proxy.

8 . Q : H O W D O I V OT E B Y M A I L ?A: By completing and signing the enclosed proxy form and

returning same in the envelope provided.

9 . Q : H O W D O I V OT E B Y FA X ?A: By completing and signing the enclosed proxy form and for-

warding same by fax at 1-866-249-7775 (toll-free withinCanada and the United States) or at 416-263-9524 (outsideCanada and the United States). IF YOUR SHARES ARE NOT REGIS-TERED IN YOUR NAME (E.G., IF THEY ARE HELD THROUGH ABANK, TRUST COMPANY, SECURITIES BROKER OR OTHERNOMINEE), DO NOT USE THE ABOVE FAX NUMBERS AS THEY AREONLY PROVIDED FOR REGISTERED SHAREHOLDERS. INSTEAD,USE THE FAX NUMBERS, IF ANY, PROVIDED BY YOUR NOMINEE(see Question No. 22).

1 0 . Q : H O W D O I V OT E I N P E R S O N ?A : By presenting your admission ticket (attached to the proxy

form) at the Meeting in order to facilitate your admission.Shareholders who do not bring their admission ticket willnevertheless be admitted to the Meeting after addressingthemselves to a representative of Computershare. Personswho are not shareholders may be admitted subject to the dis-cretion of the chairman of the Meeting and subject to anyspace constraints after addressing themselves to a represen-tative of Computershare. Non-registered shareholders wishingto attend the Meeting should refer to Question No. 22.

1 1 . Q : A R E P R I Z E S O F F E R E D FO R V OT I N G ?A: Yes! 20 prizes have been set aside to be awarded to share-

holders who vote their shares in relation to the 2002 Annualand Special Meeting of Shareholders. The contest marks thefirst time that BCE offers to its shareholders the possibility ofvoting on the Internet.

Winners will be selected randomly from among all regis-tered shareholders (i.e., shares registered in your namedirectly with BCE’s transfer agent) and beneficial shareholders(i.e., shares held indirectly through a broker or other nominee)who vote by returning their proxy form or voting instructionson the Internet, by mail, fax, phone (for non-registered share-holders only) or in person. Winners may chose one of twoavailable prizes: (i) a complete Bell ExpressVu direct to homesatellite television package including satellite dish, receiver,installation, and 12 months of free programming, or (ii) a subscription to GlobeInvestorGold.com providing in-depthstock market coverage and key financial information with realtime quotes (without 15 minute delay) from all major NorthAmerican markets.

All winners will be required to answer a skill testing ques-tion correctly. Full contest rules may be viewed on BCE’swebsite at www.bce.ca or may be obtained by sending astamped self-addressed envelope to BCE Vote rewardsprogram, 1000, rue de La Gauchetière Ouest, Suite 3700,Montréal, Québec, H3B 4Y7. This contest is void where prohib-ited by law or by the contest rules.

1 2 . Q : W H AT I F I S I G N T H E P R O X Y FO R M A S D E S C R I B E D I NT H I S M A N A G E M E N T P R O X Y C I R C U L A R ?

A : Signing the proxy form gives authority to Mr. J. C. Monty,Mr. R. J. Currie, Mr. J. E. Newall or Mrs. D. Soble Kaufman, all ofwhom are directors of the Corporation, to vote your sharesat the Meeting in accordance with the voting instructionsyou provide.


1 3 . Q : C A N I A P P O I N T S O M E O N E OT H E R T H A N T H E S ED I R E C TO R S TO V OT E M Y S H A R E S ?

A : Yes. You have the right to appoint some other person of yourchoice, who need not be a shareholder, to attend and act onyour behalf at the Meeting. If you wish to appoint a personother than the directors whose names are printed on theproxy form, please strike out those four printed namesappearing on the proxy form, and insert the name of yourchosen proxyholder in the space provided thereon to thiseffect. (NOTE: IT IS IMPORTANT TO ENSURE THAT ANY OTHERPERSON YOU APPOINT IS ATTENDING THE MEETING AND IS AWARETHAT HIS OR HER APPOINTMENT HAS BEEN MADE TO VOTE YOURSHARES. PROXYHOLDERS SHOULD, AT THE MEETING, PRESENTTHEMSELVES TO A REPRESENTATIVE OF COMPUTERSHARE ATTHE TABLE IDENTIFIED AS “ALTERNATE ATTORNEYS/EXTERNALPROXYHOLDERS”).

1 4 . Q : W H AT I F M Y S H A R E S A R E R E G I S T E R E D I N M O R E T H A NO N E N A M E O R I N T H E N A M E O F M Y C O R P O R AT I O N ?

A : If the shares are registered in more than one name, all thoseregistered should sign the proxy form. If the shares are regis-tered in the name of your corporation or any name other thanyours, you may require documentation evidencing your powerto sign the proxy form.

1 5 . Q : H O W W I LL M Y S H A R E S B E V OT E D I F I V OT E B Y P R O X Y ?A : The persons named in the proxy form must vote or withhold

from voting your shares in accordance with your instruc-tions on the proxy. In the absence of such instructions,however, your shares will be voted FOR the election tothe Board of Directors of the Corporation until the close ofthe next annual meeting of the nominees proposed byManagement mentioned in this Management Proxy Circularand on the proxy form, the appointment of Deloitte & ToucheLLP as the auditors of the Corporation until the close of the next annual meeting of shareholders, the proposedamendment to the Articles of Incorporation of BCE,the confirmation of By-Law One of BCE and in favourof Management’s proposals generally.

1 6 . Q : I F I C H A N G E M Y M I N D , C A N I TA K E B A C K M Y P R O X YO N C E I H AV E G I V E N I T ?

A : Yes. A shareholder who has voted by proxy may revoke it byvoting again in any manner (Internet, mail or fax). In addition,a shareholder may revoke a voted proxy by depositing aninstrument in writing (which includes another proxy form witha later date) executed by the shareholder or by the share-holder’s attorney authorized in writing with BCE’s CorporateSecretary at 1000, rue de La Gauchetière Ouest, Suite 3700,Montréal, Québec, Canada H3B 4Y7, at any time up to andincluding the last business day preceding the day of theMeeting, or any adjournment or postponement thereof, or bydepositing it with the chairman of the Meeting on the day ofthe Meeting, or any adjournment or postponement thereof.A shareholder may also revoke a proxy in any other mannerpermitted by law.

It should be noted that the participation in person by ashareholder in a vote by ballot at the Meeting will automati-cally revoke any proxy which has been previously given by theshareholder in respect of business covered by that vote.

1 7 . Q : W H AT I F A M E N D M E N T S A R E M A D E TO T H E S E M AT T E R SO R I F OT H E R M AT T E R S A R E B R O U G H T B E FO R E T H EM E E T I N G ?

A : The person named in the proxy form will have discretionaryauthority with respect to amendments or variations tomatters identified in the Notice of 2002 Annual and SpecialMeeting and to other matters which may properly comebefore the Meeting. As of the date of this Management ProxyCircular, the Management of the Corporation knows of no suchamendment, variation or other matter expected to comebefore the Meeting. If any other matters properly come beforethe Meeting, the persons named in the proxy form will vote onthem in accordance with their best judgment.

1 8 . Q : H O W W I LL T H E V OT E S B E C O U N T E D ?A : The election of directors, the appointment of auditors and

the confirmation of By-Law One of BCE will each be deter-mined by a majority of votes cast at the Meeting in proxy orby person (an ordinary resolution), while the amendment tothe Articles of Incorporation of BCE must be approved by theaffirmative vote of not less than two-thirds of the votes castat the Meeting by proxy or in person (a special resolution). Inthe case of equal votes, the chairman of the Meeting is entitledto a second or casting vote.


19 . Q : I S M Y V OT E C O N F I D E N T I A L ?A : Yes. Computershare counts and tabulates the proxies. This is

done independently of the Corporation to preserve the confi-dentiality of individual shareholder votes. Proxies are referredto the Corporation only in cases where a shareholder clearlyintends to communicate with Management (by making awritten statement on the proxy form), in the event of a proxycontest or when it is necessary to do so to meet the require-ments of applicable law.

2 0 . Q : H O W C A N I C O N TA C T T H E T R A N S F E R A G E N T ?A : You can contact the transfer agent by mail at:

Computershare Trust Company of Canada100 University Avenue9th FloorToronto, Ontario, Canada M5J 1V6

or by telephone:within Canada and the United States at 1-800-561-0934, or inthe Montréal area or from any country other than Canada andthe United States at 514-982-7555;

or by fax at 416-263-9524 (outside Canada and the UnitedStates) or at 1-866-249-7775 (toll-free within Canada and theUnited States);

or by e-mail at [email protected].

2 1 . Q : M AY T H E C O R P O R AT I O N A P P O I N T OT H E R A G E N T S ?A : Yes. The Corporation may appoint agents in cities other than

Toronto for the purpose of facilitating the delivery of proxies; ifsuch agents are appointed, Computershare will supply theirnames and addresses on request (in such a case, requestsshould be addressed to Computershare in the mannerdescribed in Question No. 20.)

2 2 . Q : I F M Y S H A R E S A R E N OT R E G I S T E R E D I N M Y N A M E B U T A R E H E L D I N T H E N A M E O F A N O M I N E E ( A B A N K ,T R U S T C O M PA N Y, S E C U R I T I E S B R O K E R , T R U S T E E O R OT H E R ) , H O W D O I V OT E M Y S H A R E S ?

A : (1) By providing voting instructions to your nominee. Yournominee is required to seek voting instructions from you inadvance of the Meeting. Accordingly, you will receive or havealready received from your nominee either a request for votinginstructions or a form of proxy for the number of shares youhold. Every nominee has its own procedures which should becarefully followed by non-registered shareholders to ensurethat their shares are voted at the Meeting. These proceduresgenerally allow voting by telephone, on the Internet, by mail orby fax. IF YOUR SHARES ARE NOT REGISTERED IN YOUR NAME, DONOT USE THE FAX NUMBERS PROVIDED IN QUESTION NO. 9 ORTHE CORPORATION’S WEBSITE AS THESE COORDINATES ARE ONLYVALID FOR REGISTERED SHAREHOLDERS.(2) By attending the Meeting in person. The Corporation doesnot have access to the names of its non-registered sharehold-ers. Therefore, if you attend the Meeting, the Corporation willhave no record of your shareholdings or of your entitlement tovote unless your nominee has appointed you as proxyholder. Ifyou wish to vote in person at the Meeting, insert your ownname in the space provided on the request for voting instruc-tions or proxy form to appoint yourself as proxyholder andfollow the instructions of your nominee. Non-registered share-holders who instruct their nominee to appoint themselves asproxyholders should, at the meeting, present themselves to arepresentative of Computershare at the table identified as“alternate attorneys/external proxyholders”. Do not otherwisecomplete the form sent to you as your vote will be taken andcounted at the Meeting.


ELECTRONIC DELIVERY

A . Q : W H AT I S E L E C T R O N I C D E LI V E R Y ?A: A voluntary program for e-mail notification to BCE sharehold-

ers that documents which must be delivered pursuant tosecurities legislation are available on BCE’s website. Everyyear, BCE delivers to its shareholders documentation, such asthis Management Proxy Circular and our Annual Report, thatmust by law be delivered to shareholders of a public company.BCE would like to make this process more convenient for itsshareholders and hence proposes that for those shareholderswho so wish it, they will be notified by e-mail when BCE’s doc-umentation is posted on BCE’s website (www.bce.ca). BCEbelieves that electronic delivery will benefit the environmentand reduce costs for BCE.

B . Q : D O I H AV E TO C O N S E N T TO E L E C T R O N I C D E LI V E R Y ?A: No. Electronic delivery is voluntary; shareholders who do not

consent will continue to receive such documentation by mail,as they have been receiving same for years.

C . Q : I F I C O N S E N T TO E L E C T R O N I C D E LI V E R Y , W H E N W I LLI T B E C O M E E F F E C T I V E ?

A: After July 1, 2002. Subject to any required regulatoryapprovals, electronic delivery will come into effect followingthe second quarter of 2002. If you consent to electronic deli-very, you will be notified of the availability on the BCE website(www.bce.ca) of all documentation which must be sent to youunder securities legislation after July 1, 2002.

D . Q : H O W C A N I C O N S E N T TO E L E C T R O N I C D E LI V E R Y ?A: By going to the following website: www.bce.ca. Click on the

vote online link and follow the instructions on screen. You willneed your Control Number and your PIN Number (you will findthese two numbers on the enclosed proxy form).

BUSINESS TO BE TRANSACTED AT THE MEETING(See Notice of 2002 Annual and Special Meeting)

1 . P R E S E N T A T I O N O F F I N A N C I A L S T A T E M E N T S

The consolidated financial statements for the year ended December 31,2001, and the report of the auditors thereon will be placed before theMeeting. The consolidated financial statements are included in the BCEInc. 2001 Annual Report which is being mailed to shareholders withthe Notice of 2002 Annual and Special Meeting and this ManagementProxy Circular.

2 . E L E C T I O N O F D I R E C T O R S (See item 1 on proxy form)

Thirteen directors are to be elected to hold office until the close of thenext annual meeting of the shareholders.

The thirteen persons nominated in this Management Proxy Circularare, in the opinion of Management, well qualified to direct theCorporation’s activities for the ensuing year.

All nominees have formally established their eligibility and willing-ness to serve as directors and were elected at the 2001 Annual andSpecial Meeting of BCE except for Messrs. A. S. Fell and R. C. Pozen whowere appointed to the Board in January 2002 and February 2002,respectively.

It is the intention of the persons whose names are printed in theenclosed proxy form to vote such proxy for the election of the nomi-nees listed herein unless otherwise specifically instructed on theproxy form.

If, prior to the Meeting, any of the listed nominees should becomeunavailable to serve, the persons designated in the proxy form willhave the right to use their discretion in voting for a properly qualifiedsubstitute.

The persons named as proxies in the enclosed proxy form intendto cast the votes represented by proxy at the Meeting FOR the elec-tion of the thirteen persons nominated in this Management Proxy Circular to serve as directors unless the holder of common shareswho has given such proxy has otherwise directed.

3 . A P P O I N T M E N T O F A U D I T O R S (See item 2 on proxy form)

A firm of auditors is to be appointed by vote of the shareholders at theMeeting to serve as auditors of the Corporation until the close of thenext annual meeting. The Board of Directors, on the advice of the AuditCommittee, recommends that Deloitte & Touche LLP be reappointed asthe Corporation’s auditors.

The persons named as proxies in the proxy form intend to castthe votes represented by proxy at the Meeting FOR the appointmentof Deloitte & Touche LLP as auditors of the Corporation unless theholder of common shares who has given such proxy has directedthat the common shares be withheld from voting.


4 . A M E N D M E N T T O A R T I C L E S O F I N C O R P O R A T I O N(See item 3 on proxy form)

The Corporation is governed by the Canada Business Corporations Act(the “CBCA”). Effective November 24, 2001, the first major changes tothe CBCA in over 25 years were enacted. The recent amendments tothe CBCA, inter alia, allow for greater corporate flexibility and recognizetechnological evolution.

As a global communications company bringing together connectiv-ity, content and commerce, BCE’s activities are bound to expandbeyond the borders of Canada. Already, BCE’s interests in TeleglobeInc. (“Teleglobe”) and BCE Emergis Inc. (“BCE Emergis”) haveincreased BCE’s presence in other countries. As the CBCA now providesthat a meeting of shareholders of a corporation may be held at a placeoutside Canada if the place is specified in the Articles of Incorporation,the Board of Directors and Management believe that BCE shouldamend its Articles of Incorporation to be in a position to avail itself,should the future development of the Corporation warrants it, of thepossibility to hold annual shareholders’ meetings outside Canada. TheCorporation does not currently expect to hold a shareholder meetingoutside of Canada for the next few years.

At the Meeting, you will be asked to consider and, if you consider itappropriate, adopt a special resolution (which requires the affirmativevote of not less than two-thirds of the votes cast at the Meeting byproxy or in person) in the form attached hereto as Schedule “A” toapply for a Certificate of Amendment under the CBCA to amend theArticles of Incorporation of BCE in order to provide for the possibility ofholding annual meetings of shareholders at places outside Canada.

5 . C O N F I R M A T I O N O F B Y - L A W O N E (See item 4 on proxy form)

Effective February 27, 2002, the Board of Directors enacted By-LawOne regulating generally the business and affairs of the Corporation.The Board of Directors and Management request that you considerand, if deemed appropriate, confirm By-Law One which replaced BCE’sBy-Law in effect immediately prior to February 27, 2002. By-Law Oneprovides for the appointment of a lead director to ensure that theBoard of Directors can function independently of Management in theevent that the directors determine from time to time that the Chairmanof the Board is an officer of the Corporation acting in an executivecapacity. By-Law One sets forth the general rules with respect to thebusiness and affairs of the Corporation, including the formalitiesassociated with shareholder meetings, the payment of dividends, com-munications between the Corporation and the shareholders, theappointment of directors and formalities associated with meetings ofthe Board of Directors and the framework for the execution of docu-ments on behalf of the Corporation. By-law One was adopted in largepart in response to the changes to the CBCA which became effective inNovember 2001 as well as in order to provide greater flexibility withrespect to the management of the business and affairs of theCorporation. By-Law One includes provisions relating to the holding ofdirector and shareholder meetings by electronic means, as well asrelating to the voting at shareholder meetings by electronic means.By-Law One also contains provisions permitting shareholder meetingsto be held in certain circumstances exclusively by various means of

communication facilities. By-Law One permits that notices of share-holder meetings may be given electronically, modifies the periodswithin which notices of shareholder meetings must be sent to not lessthan 21 days and not more than 60 days (by opposition to the previous21 and 50 days), reduces the quorum requirement from 25% to 20% formeetings of common shareholders, permits the payment of dividendsby electronic means as well as the payment of dividends in currenciesother than Canadian dollars, clarifies the timing of the effectiveness ofresignations of directors, reduces the notice period for meetings ofdirectors from 48 hours to 24 hours, provides that meetings of direc-tors may be held outside of as well as within Canada and provides thatdirectors may participate in meetings of directors by means of tele-phonic, electronic or other communication facilities. The text of By-LawOne is attached hereto as Appendix 1 to Schedule “B”; shareholderswho would like to have a copy of the previous By-Law as in effect priorto February 27, 2002 should contact the Corporate Secretary of BCE at514-870-8777 or by fax at 514-786-3801.

Pursuant to the CBCA, the Board of Directors has adopted By-LawOne and is required to submit same to BCE’s shareholders at thisannual meeting. At the Meeting, you will be asked to consider and, ifyou consider it appropriate, adopt, with or without variation, an ordi-nary resolution in the form attached hereto as Schedule “B” confirmingBy-Law One.

6 . O T H E R B U S I N E S S

The chairman of the Meeting will report on recent events of signifi-cance to the Corporation and on other matters of interest to theshareholders and will invite questions and comments from the floor.


NOMINEES FOR ELECTION AS DIRECTORS AND THEIR BENEFICIAL OWNERSHIP OF VOTING SECURITIES

Abbreviations BCI = Bell Canada International Inc., BCE Emergis = BCE Emergis Inc., Bell Globemedia = Bell Globemedia Inc., Teleglobe = Teleglobe Inc.

Director since Holdings

Richard James Currie, C.M., May 1995 BCE common 30,151Toronto, Ontario BCE share units(1) 15,302President and a director, George Weston Limited

(a food processing and distribution company).Lead Director, Chairman, Management Resources and Compensation

Committee and member, Corporate Governance Committee.Also a director of CAE Inc., Imperial Oil Limited and

Teleglobe.

Anthony Smithson Fell, O.C., January 2002 BCE common 10,000Toronto, OntarioChairman, RBC Dominion Securities Limited

(underwriters of government and corporate securities of all kinds)Mr. Fell has held the above position since 1998. He was also Chief Executive Officer,

of RBC Dominion Securities Limited from 1980 to 1998.Member, Audit Committee.Also a director of CAE Inc., Loblaw Companies Limited,

Munich Reinsurance Company of Canada and Teleglobe.

Donna Soble Kaufman, June 1998 BCE common 2,000Toronto, Ontario BCE share units(1) 6,661Lawyer and Corporate Director. BCI common 1,000Partner with Stikeman Elliott, Barristers & Solicitors, BCI share units(2) 6,089

until July 1997.Member, Audit Committee.Also a Director of BCI, Bell Globemedia, Hudson’s Bay Company,

Public Sector Pension Investment Board (Canada), TransAlta Corporation and UPM-Kymmene Corporation.

Thomas Edward Kierans, O.C., April 1999 BCE common 9,027Toronto, Ontario BCE share units(1) 2,748Chairman, Canadian Institute for Advanced Research (CIAR)

(the CIAR is Canada’s “research university without walls”; it conducts basic research programs in the social and natural sciences).

Member, Audit Committee.Also Chairman of the Board of CSI Global Education Inc. and Toronto Centre

and a director of Inmet Mining Corporation, IPSCO Inc., Manulife Financial Corporation, Petro-Canada and Teleglobe.

Brian Michael Levitt, May 1998 BCE common 2,813Montréal, Québec BCE share units(1) 11,030Co-Chair, Osler, Hoskin & Harcourt LLP, Business Lawyers.President and Chief Executive Officer of Imasco Limited until February 2000.Member, Management Resources and Compensation Committee.Also a director of Alcan Inc., Bell Globemedia, Cossette Communication

Group Inc., Domtar Inc. and Montreal Museum of Fine Arts.

(1) See the Report on Executive Compensation under the heading Share Units on page 13 and Compensation of Directors on page 20 for a descriptionof the share unit plans in effect for BCE officers and for BCE, Bell Canada, Bell Globemedia and Teleglobe directors, respectively.

(2) See the description of the BCI Share Unit Plan for non-officer directors of BCI in Note (2) to the table on page 22.

1 0 B C E I N C . 2 0 0 2 M A N A G E M E N T P R O X Y C I R C U L A R

NOMINEES FOR ELECTION AS DIRECTORS AND THEIR BENEFICIAL OWNERSHIP OF VOTING SECURITIES (continued)


Judith Maxwell, C.M., January 2000 BCE common 500Ottawa, Ontario BCE share units(1) 2,766President,Canadian Policy Research Networks Inc. (“CPRN”)

(CPRN is a non-profit organization whose mission is to create knowledge and lead public debate on social and economic issues important to Canadians. The research focuses on work, family, health and social policy).

Member, Audit Committee.Also a director of Bell Canada and Clarica Life Insurance Company.

John Hector McArthur, May 1995 BCE common 782Wayland, Massachusetts BCE share units(1) 16,155Dean Emeritus, Harvard University Graduate School of Business BCE Emergis 1,000

Administration. commonMember, Corporate Governance Committee and Management Resources BCE Emergis

and Compensation Committee. share units 1,148Also a director of AES Corporation, BCE Emergis, Cabot Corporation,

GlaxoSmithKline plc, KOC Holdings, A.S., Reuters Founders Share Company Limitedand Rohm and Haas Company.

Also a Senior Advisor to the President of the World Bank, Washington, DC.

Jean Claude Monty, C.M., May 1991 to BCE common 77,014Montréal, Québec September 1992 BCE share units(1) 230,126Chairman and Chief Executive Officer of BCE, and reappointed BCI common 5,000

Bell Canada and Teleglobe October 1997 BCE Emergis 5,000Also Chairman of the Board of BCE Emergis and Bell Globemedia and common

a director of BCI and Bombardier Inc.

James Edward Newall, O.C., May 1989 BCE common 6,439Calgary, Alberta BCE share units(1) 22,975Chairman, Newall and Associates (a consulting company).Chairman, Audit Committee and member, Corporate Governance Committee.Also Chairman of the Board of NOVA Chemicals Corporation and Canadian Pacific Railway Limited

and a director of Alcan Inc., Bell Canada, Maple Leaf Foods Inc., McCain Capital Corporation and Royal Bank of Canada.

Robert Charles Pozen, February 2002Newton, MassachusettsLecturer in Public Policy, Kennedy School of Government, Harvard University.Mr. Pozen served as President of Fidelity Management and Research Company from

1997 to 2001 and as Vice-Chairman of Fidelity Investments in 2000 and 2001.

(1) See the Report on Executive Compensation under the heading Share Units on page 13 and Compensation of Directors on page 20 for a description ofthe share unit plans in effect for BCE officers and for BCE, Bell Canada, Bell Globemedia and Teleglobe directors, respectively.

B C E I N C . 2 0 0 2 M A N A G E M E N T P R O X Y C I R C U L A R 1 1

NOMINEES FOR ELECTION AS DIRECTORS AND THEIR BENEFICIAL OWNERSHIP OF VOTING SECURITIES (continued)


Guy Saint-Pierre, O.C., May 1995 BCE common 6,291Montréal, Québec BCE share units(1) 15,157Chairman and a director, SNC-Lavalin Group Inc. BCI common 1,000

(an engineering-construction company).Chairman, Corporate Governance Committee.Also Chairman of the Board of Royal Bank of Canada and

a director of Alcan Inc., Bell Canada and General Motors of Canada Limited.

Paul Mathias Tellier, P.C., C.C., Q.C., April 1999 BCE common 1,700Montréal, Québec BCE share units(1) 12,326President and Chief Executive Officer and a director, Canadian National

Railway Company (“CN”)(CN operates Canada’s largest freight railway system).

Member, Management Resources and Compensation Committee.Also a director of Alcan Inc., Bell Canada, Bombardier Inc.,

Grand Trunk Corporation and McCain Foods Limited.

Victor Leyland Young, O.C., May 1995 BCE common 5,083St. John’s, Newfoundland BCE share units(1) 7,064Corporate Director. BCI common 500Member, Audit Committee. Aliant Inc. common 1000Also a director of Churchill Falls (Labrador) Corporation (CFLCO),

McCain Foods Limited and Royal Bank of Canada.

(1) See the Report on Executive Compensation under the heading Share Units on page 13 and Compensation of Directors on page 20 for a descriptionof the share unit plans in effect for BCE officers and for BCE, Bell Canada, Bell Globemedia and Teleglobe directors, respectively.


DIRECTORS’ AND OFFICERS’ REMUNERATION

R E P O R T O N E X E C U T I V E C O M P E N S A T I O N

C O M P E N S A T I O N P H I L O S O P H YThe objectives of BCE’s executive compensation policy are to assist inattracting and retaining executives, and to motivate them to achieveand surpass individual and group performance objectives consistentwith creating shareholder value and advancing BCE’s corporate success.

The compensation philosophy of BCE is to offer total compensationbased on a comparator group of major Canadian and U.S. corporations.A substantial portion of the cash compensation is contingent upon cor-porate performance. In addition, there are long-term incentiveprograms designed to motivate the attainment of longer-term objec-tives, to align executive and shareholder interests and to ensureopportunities for capital accumulation as share prices increase.

Underlying BCE’s compensation programs is an emphasis on shareownership, and officers of BCE are required to attain specified shareownership levels over a five-year period. Such levels are expressed asa percentage of annual base salary and range from 200% for the lowestofficer position to 500% for the Chief Executive Officer.

The Management Resources and Compensation Committee (“MRCC”)undertakes periodic reviews of BCE’s executive compensation policy toensure its continued effectiveness in meeting the foregoing objectives.

C O M P O S I T I O N O F T H E C O M P E N S A T I O N C O M M I T T E EThe MRCC is responsible for the administration of BCE’s executive com-pensation policy. The MRCC reports and makes recommendations onexecutive compensation matters to the Board of Directors.

The members of the MRCC are Messrs. R. J. Currie, B. M. Levitt, J. H.McArthur , R. C. Pozen (appointed in February 2002) and P. M. Tellier.Mr. Currie is Chairman of the committee. The MRCC met 4 times during2001. As a corporate practice, in 2001, the Chairman and ChiefExecutive Officer of BCE also attended MRCC meetings except whenmatters pertaining to him were discussed. He does not vote at MRCCmeetings.

T O T A L C O M P E N S A T I O NTotal compensation, which comprises salary, annual short-term incen-tive awards, long-term incentives, benefits and perquisites, iscompared to a group of widely-held Canadian and U.S. corporations. Thiscomparator group of companies is reviewed from time to time by theMRCC to ensure comparability in the current context. Total compensa-tion levels are set to reflect both the marketplace (to ensurecompetitiveness) and the responsibility of each position (to ensureinternal equity). The total compensation policy is positioned betweenthe 50th and the 75th percentile based on individual contribution andon meeting certain financial threshold targets, e.g. if positioned at the75th percentile, 25% of the companies pay more and 75% of the compa-nies pay less.

SalaryThe target salary is the mid-point of a salary range for an executiveofficer which is set at median levels in the comparator group to reflectsimilar positions in these companies using a direct comparison ofresponsibilities. Base salaries for executive officers are then deter-mined by the MRCC within the above policy.

The salary of Mr. Jean C. Monty of $1,300,000 per annum as ChiefExecutive Officer for 2001 was set at the mid-point of the foregoingsalary range, consistent with the above philosophy.

Annual Short-Term Incentive AwardsAs part of the executive compensation policy, the MRCC establishedannual short-term incentive target awards ranging in 2001 from 35% ofthe salary for the lowest eligible officer position to 100% for the ChiefExecutive Officer.

Annual awards are based upon two factors: (1) corporate performance — this is assessed on the basis of various

strategic business objectives and quantifiable financial targetsboth set at the beginning of the year as the Corporate Mandate bythe Board of Directors (see Strategic Planning (Corporate Mandate)under M A N D A T E O F T H E B O A R D on page 23). Strategic busi-ness objectives might include, for example, a specific corporateobjective with respect to a particular subsidiary, the developmentof new businesses, the improvement of management development,or the strengthening of certain relationships. Quantifiable financialtargets might include, for example, baseline earnings per share orcontribution to earnings from core businesses. Although the corpo-rate performance objectives have different relative weights,primary consideration is generally given to the quantifiable finan-cial targets for BCE and its principal business units; and

(2) individual contribution — this is evaluated on the basis of criteriawhich affect corporate performance, such as creativity and initia-tive in addressing business issues, succession planning andmanagement development.

On the basis of the above factors, the MRCC determines the size ofthe annual short-term incentive awards. More specifically, the amountof the awards is computed based on the product of the corporate per-formance factor and of the individual contribution factor. Actual awardsmay vary between zero and three times the target awards dependingon achievement of the above two factors. In most instances, they areonly paid at the beginning of the year with respect to performance inthe previous year. Executive officers who are eligible to participate inthe BCE Inc. Share Unit Plan for Senior Executives and Other KeyEmployees (1997) (the “Executive Share Unit Plan”) can elect to bepaid up to 100% of the annual short-term incentive awards in the formof share units (see Share Units on page 13).

Given his receipt of his whole annual short-term incentive award inshare units, no short-term incentive award in the form of cash wasgranted for the year 2001 to Mr. Monty in his capacity as ChiefExecutive Officer.

Long-Term Compensation

Stock OptionsOptions to purchase BCE common shares may be granted under stockoption plans of the Corporation to officers and other key employees ofthe Corporation and of certain of its subsidiaries (such stock optionplans being herein collectively referred to as the “BCE Stock OptionProgram”). Stock option awards vary according to salary level and donot take outstanding options into account. Grant levels depend on theposition of the incumbent and the total compensation relative to themarket. They are based on the value required to attain the applicablepercentile (i.e., between the 50th and 75th percentile in total marketcompensation, as previously discussed on page 12 under T O T A L C O M -P E N S A T I O N ) and translated to options based on the market value ofthe Corporation’s common shares on the day prior to the effective dateof the grant of the options (“Subscription Price”).

In addition, special grants of stock options may be approved to rec-ognize singular achievements or, exceptionally, to retain and motivateexecutives in order to further align executive and shareholder interestsand to motivate key employees (“Special Grants”).

The term of an option is normally ten years from the date of thegrant except in the case of retirement, cessation of employment, deathor an optionee’s employer ceasing to be the Corporation or a subsidiaryof the Corporation, in which case the term may be reduced in accor-dance with the provisions of the BCE Stock Option Program or inaccordance with decisions made from time to time by the MRCC undersuch program.

Except as indicated below, the right to exercise an option in itsentirety accrues by 25% annual increments over a period of four yearsfrom the date of grant unless otherwise determined by the MRCC at thetime of grant. For example, in the case of the Special Grants of options,the right to exercise such options may accrue over a longer period oftime. Furthermore, the BCE Stock Option Program was modified in 1999to provide special vesting provisions in the event of a Change of Control(as defined below) of the Corporation. If there occurs a Change ofControl of the Corporation and an optionee’s employment is terminatedby the Corporation other than for cause or by the optionee for goodreason (as set out in more detail in the BCE Stock Option Program, an“Unjustified Termination”) within 18 months following such Change ofControl, the options then held by such optionee with respect to whichthe right to exercise has not yet accrued become exercisable in full fora period of 90 days thereafter, or such longer period as the MRCC maydetermine. “Change of Control” is defined, in essence, as (i) an offeroracquiring 50% or more of the outstanding securities of a class of votingor equity securities of the Corporation; (ii) certain changes to the com-position of the majority of the Board of Directors of the Corporation; or(iii) the approval by the shareholders of the Corporation of plans oragreements providing for the disposition of all or substantially all theassets of the Corporation, the liquidation or dissolution of theCorporation or, in certain cases, the merger, consolidation or amalga-mation of the Corporation. Options held by an optionee principallyemployed in a BCE business unit, such as Bell Canada or such otherdirect or indirect subsidiary of the Corporation identified by the MRCC(a “Designated Business Unit”), with respect to which the right to exer-cise has not yet accrued will, in the event that the Corporation ceases

to hold at least a 50% interest but continues to hold at least a 20%interest in such Designated Business Unit and the employment of theoptionee is terminated in a manner which constitutes an UnjustifiedTermination within 18 months following the decrease in theCorporation’s interest in the Designated Business Unit, become exer-cisable in the same manner as described above with respect to aChange of Control. Options held by an optionee principally employed ina Designated Business Unit with respect to which the right to exercisehas not yet accrued will, in the event that the Corporation ceases tohold at least a 20% interest in such Designated Business Unit, becomeexercisable in full, effective upon the earlier of the date one year fol-lowing the occurrence of such event or the date of an UnjustifiedTermination of the optionee, for a period of 90 days thereafter or suchlonger period as the MRCC may determine.

Beginning in the latter part of 2001, the terms for BCE optionsgenerally provide that, should the holder cease to be employed by BCEor its subsidiaries and subsequently engages in Unfair EmploymentPractices (which includes using confidential BCE information for thebenefit of a subsequent employer), all then unexercised BCE optionsterminate, and, in addition, the holder shall reimburse to BCE theafter tax profit realized upon any option exercises in the preceding12 months.

The exercise price payable for each common share covered by anoption is generally the Subscription Price except where the MRCCmakes a determination that the exercise price should be higher thanthe Subscription Price or where the MRCC establishes, subject to anyrequired approval of the stock exchanges on which the common sharesof the Corporation are listed and posted for trading, that the exerciseprice should be less than the Subscription Price in the event that anoption to acquire shares of a subsidiary of the Corporation or acompany which is proposed to become a subsidiary of the Corporationis intended to be converted into an option to acquire common shares ofthe Corporation so that the economic position of the optionee is notaffected by such conversion.

Prior to November 1999, simultaneously with the granting of anoption, rights to a Special Compensation Payment (“SCP”) have beengranted by the optionee’s employer. A SCP is a cash payment repre-senting the excess of the market value of the shares on the date ofexercise over their Subscription Price. When SCPs are attached tooptions, the SCPs are triggered when the options are exercised.

Mr. Monty received a grant of 650,000 options in 2001 as ChiefExecutive Officer of BCE.

Share UnitsTo increase the alignment of executive and shareholder interests, BCEestablished the Executive Share Unit Plan pursuant to which shareunits (“Units”), each one being equivalent in value to one BCE commonshare, may be awarded to certain officers and other key employees ofthe Corporation and of certain BCE subsidiaries (the “Participants”).Unit awards may be annual awards or may be special awards to recog-nize singular achievements or to achieve certain corporate objectives.

On each BCE common share dividend payment date, additional Unitsare credited to the account of the Participants in an amount equivalentto dividends on outstanding BCE common shares. Following cessationof employment of a Participant, Units are paid, after remittance of



applicable withholding taxes, in BCE common shares purchased on theopen market.

There are no vesting conditions under the terms of the ExecutiveShare Unit Plan. Furthermore, the number and terms of outstandingUnits are not taken into account when determining whether and howmany new Units will be awarded.

The Executive Share Unit Plan allows eligible officers to elect to be paid up to 100% of the annual short-term incentive award in the formof share units in lieu of being paid in cash. Thus, once the MRCCapproves the annual short-term incentive awards based on the factorsdescribed under Annual Short-Term Incentive Awards, on the basis ofthe election of the eligible officer, the MRCC establishes the number ofUnits granted.

The MRCC recommended, and the Board of Directors approved, thatMr. Monty receive 44,910 Units based on an award of $1,500,000 inrespect of 2001. The basis for the determination of the award incorpo-rates two factors; Corporate Mandate targets applicable to each of theCorporation’s principal business units and an individual contributionfactor. The award reflects the fact that, in 2001, BCE did not fullyachieve the Corporate Mandate targets and with respect to the individ-ual contribution factor, the MRCC and the Board assessed thatMr. Monty had exceeded the targets.

I M P A C T O F D I S T R I B U T I O N B Y B C E O F S H A R E S O F N O R T E L N E T W O R K SIn connection with the distribution by the Corporation of an approxi-mate 35% ownership interest in Nortel Networks Corporation (“NortelNetworks”) as part of a Plan of Arrangement (the ‘‘Arrangement’’) onMay 1, 2000, the existing outstanding stock options granted by theCorporation were cancelled and options to acquire an equal number ofcommon shares of the Corporation on the same terms and conditionsas the original options and options to acquire common shares of NortelNetworks were issued in replacement (the “Nortel Replacement Options”)to reflect the reduced value and market price of the common shares ofBCE after giving effect to the Arrangement. Nortel Replacement Optionsare not governed by the BCE Stock Option Program but rather are gov-erned by stock option plans of Nortel Networks adopted in connectionwith the Arrangement, which include terms and conditions generallysimilar to the BCE Stock Option Program.

The SCPs attached to options granted prior to November 1999 underthe BCE Stock Option Program and still outstanding as at the time of theArrangement were replaced, in connection with the Arrangement, bySCPs attached respectively to the options to acquire BCE commonshares and to the Nortel Replacement Options issued in replacement ofsuch options so that such SCPs are triggered when the options toacquire BCE common shares or the Nortel Replacement Options, as thecase may be, are exercised. However, the payment of all SCPs out-standing at the time of the Arrangement remain the responsibility ofthe original employer.

Nortel Networks was not, at the time the Nortel ReplacementOptions were issued in connection with the Arrangement, and is not asubsidiary or an affiliate of the Corporation. As the performance of theNortel Networks shares are extrinsic to the Management of BCE andBCE no longer holds a material shareholding interest in NortelNetworks, BCE believes that, effective with the year 2001, disclosure of

the named executive officers’ holdings and exercise of NortelReplacement Options is not relevant to the disclosure of BCE’s execu-tive compensation.

E X E C U T I V E O F F I C E R SIn addition to being Chairman and Chief Executive Officer of BCE, Mr. Jean C. Monty is also Chairman and Chief Executive Officer of BellCanada and of Teleglobe, and Chairman of the Board of BCE Emergis andBell Globemedia Inc. (“Bell Globemedia”). His entire 2001 compensationwas determined by BCE’s Board of Directors in accordance with BCE’scompensation policies and paid to him by BCE.

Mr. Michael J. Sabia was President of BCE. In 2001 he was also Vice-Chair, Corporate of Bell Canada and was also appointed Chief OperatingOfficer in early 2002. He has remained Vice-Chairman of BCI untilNovember 16, 2001. His entire 2001 compensation was determined byBCE’s Board of Directors in accordance with BCE’s compensation policiesand paid to him by BCE.

Mr. John W. Sheridan is President of Bell Canada. His compensationis determined by Bell Canada’s Board of Directors in accordance withBell Canada’s compensation policies and paid by Bell Canada.

Mr. Terence J. Jarman was Chief Executive Officer of TeleglobeCommunications Corporation (‘‘TCC’’) in 2001. His entire 2001 compen-sation was determined by TCC’s Board of Directors in accordance withTCC’s compensation policies and paid to him by TCC.

Mr. Ivan Fecan was President and Chief Executive Officer of CTV Inc.(“CTV”) until January 9, 2001, when he was appointed President andChief Executive Officer of Bell Globemedia. Mr. Fecan’s compensationwas paid during part of the year in accordance with CTV’s compensationpolicies and for the remainder of the year in accordance with BellGlobemedia’s compensation policies.

The compensation policies of Bell Canada are substantially the sameas those of BCE except that their short-term incentive plans tie theirpayouts to their specific corporate objectives set out at the beginningof the year. The compensation policies of TCC and Bell Globemedia arecompatible with those of BCE, except that their short-term incentiveplans tie their payouts to their specific corporate objectives set out atthe beginning of the year. Stock option grants to Messrs. Sheridan,Jarman and Fecan in 2001 were approved by the BCE Board of Directorsupon the recommendation of each subsidiary.

Report presented February 27, 2002 by:R.J. CURRIE, CHAIRMANB.M. LEVITTJ.H. McARTHURP.M. TELLIER

S H A R E H O L D E R R E T U R N P E R F O R M A N C E G R A P H SThe graph below compares the yearly percentage change in the cumu-lative total shareholder return of the Corporation’s common sharesagainst the cumulative total shareholder return of the TSE 300Composite Index and the S&P Telecommunication Services Index for thefive-year period commencing December 31, 1996 and endingDecember 31, 2001.*

BCE$100 151 188 433 619 532

TSE 300$100 115 113 149 160 140

S&P Tel.$100 138 205 240 145 125

S&P Telecommunication ServicesThe S&P Telecommunication Index consists of 53 companies worldwideincluding among others: BCE, Telus Corp., the U.S. regional Bell operatingcompanies (BellSouth Corp., SBC Communications Inc., VerizonCommunications Inc., Qwest Communications International Inc.),European Incumbent Local Exchange Carriers (BT Group PLC, DeutscheTelekom AG, France Telecom SA, Telecom Italia SPA, Telefonica SA), U.S.long-distance providers (Sprint Corp., AT&T Corp., WorldCom Inc.), andwireless companies (AT&T Wireless Services Inc., Vodafone Group PLC,Orange PLC, China Mobile Hong Kong Ltd., NTT DoCoMo Inc.).

BCE Total Return IndexBCE Return Index value is based on price for shares held plus dividendsdue.

The Five-year Cumulative Total Return on $100 Investment graph hasbeen adjusted to reflect the distribution to the BCE common share-holders of an approximate 35% ownership interest in Nortel Networksby way of the Arrangement. For the purposes of such graph, it has beenassumed that the 1.570386 common shares of Nortel Networksreceived, as a result of the Arrangement, on a post-split basis for eachBCE common share held were sold by the BCE common shareholder onMay 5, 2000 (the first trading day when the BCE common sharesstarted trading ex-Nortel Networks) and that the proceeds from suchdisposition were invested into BCE common shares on such date(without taking into account any brokerage fee).

As supplemental information, you will find herein below a chart for theperiod starting May 5, 2000 to December 31, 2001 in order to assistyou in comparing the yearly percentage change in the cumulative totalshareholder return of BCE’s common shares against the cumulativetotal shareholder return of the TSE 300 Composite Index and the S&PTelecommunication Services Index, without giving any effect to the dis-tribution of the Nortel Networks common shares.

* Assumes that the initial value of the investment in the Corporation’scommon shares, the TSE 300 Composite Index and the S&PTelecommunication Services Index was $100 and that all subse-quent dividends were reinvested. All prices for the Corporation’scommon shares were taken from The Toronto Stock Exchange. TheTSE 300 Total Return data is obtained from The Globe and Mail andthe S&P Telecommunication Services return data is obtained fromReuters Information Services (Canada) Limited.


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Five-year Cumulative Total Return on $100 InvestmentDecember 31, 1996 – December 31, 2001

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May 5,2000

Dec. 31,2000

Dec. 31,2001

Cumulative Total Return on $100 Investment*May 5, 2000 – December 31, 2001

S&P Telecommunication ServicesTSE 300BCE


E X E C U T I V E C O M P E N S A T I O N T A B L EThe table on the following page sets forth the compensation for the financial years ended December 31, 2001, 2000 and 1999 for the individualwho occupied the position of Chief Executive Officer and the four other most highly compensated executive officers of the Corporation for 2001.Those listed in the table are referred to herein as the “Named Executive Officers”.

S U M M A R Y C O M P E N S A T I O N T A B L E

Annual compensation Long-term compensation

Awards

Securities under Restricted Shares orOther annual Options / Restricted All other

Name and principal position Year Salary Bonus compensation SARs granted Share Units compensation

($) ($) ($) (#) ($) ($)

(1) (2) (3)(4) (5)(6) (7)

2001 1,300,000 — 312,163 650,000 44,910 Share Units 33,094based on $1,500,000

2000 1,218,000 — 132,319 — 53,928 Share Units 24,311,401based on $2,114,300

1999 1,148,000 1,419,000 91,864 — 66,004 Share Units 32,126based on $1,000,000

2001 690,000 — 51,926 50,000 21,556 Share Units 19,136based on $720,000



2001 600,000 720,000 259,928 200,000 — 90,701


1999 337,500 140,000 131,058 50,400 — 163,415


2000 628,783 — 1,032,212 436,832 14,488 Share Units 1,218,934based on $588,900

1999 337,500 183,500 — 50,400 — 15,260

2001 700,000 367,500 — 150,000 — 952

2000 — — — — — —

1999 — — — — — —

Ivan FecanPresident andChief Executive Officer,Bell Globemedia

Terence J. JarmanChief Executive Officer,TCC

John W. SheridanPresident,Bell Canada

Michael J. SabiaPresident andChief Operating Officer,BCE

Jean C. MontyChairman andChief Executive Officer,BCE

(1) Mr. Monty was appointed President and Chief Executive Officer on May 6, 1998. In addition, he became Chairman on April 26, 2000 and ceased to bePresident on December 1, 2000.

Mr. Sabia was appointed Executive Vice-President of BCE on July 3, 2000, President on December 1, 2000 and President and Chief Operating Officereffective March 1, 2002. Between October 1, 1999 and July 2, 2000, Mr Sabia was Chief Executive Officer of BCI.

Mr. Sheridan was appointed President – Bell Ontario on January 1, 1999, Vice-Chair, Market Groups, Bell Canada on January 27, 2000 and President,Bell Canada on October 25, 2000.

Mr. Jarman was appointed President and Chief Executive Officer of Bell Nexxia on January 1, 1999, Vice-Chair, Corporate of Bell Canada on January 27,2000 and Chief Executive Officer of TCC on April 12, 2000.


Mr. Jarman resigned as Chief Executive Officer of TCC on January 23, 2002. For part of 2002, Mr. Jarman will stay on as Advisor to the Chief ExecutiveOfficer of BCE with continued salary and benefits and will thereafter be on a paid leave of absence for approximately two years. During the leave ofabsence, options held by Mr. Jarman prior to his leave will continue to vest, and he will continue to accrue service under the Pension plan of BellCanada and his SERP (as defined under Pension Arrangements). His SERP eligibility criteria will be amended to recognize his 27 years of service.

Mr. Fecan joined BCE on January 9, 2001 as President and Chief Executive Officer of Bell Globemedia. Mr Fecan was not an Executive Officer of BCEprior to such date.

(2) In the case of Mr. Monty, “Other annual compensation” consists of perquisites and other benefits comprised primarily, in 1999, of an amount of$71,567 (converted from U.S. dollars to Canadian dollars at the rate of 1.4858 being the average of the exchange rates in effect during 1999), in2000, of an amount of $112,136 (converted from U.S. dollars to Canadian dollars at the rate of 1.4852 being the average of the exchange rates ineffect during 2000) and in 2001, of an amount of $288,359 (converted from U.S. dollars to Canadian dollars at the rate of 1.5484 being the averageof the exchange rates in effect during 2001), representing BCE’s aggregate incremental cost related to the personal use by Mr. Monty of BCE’s cor-porate aircraft.

In the case of Mr. Sabia, “Other annual compensation” includes additional cash payments of $35,000, $100,000 and $41,667 for 1999, 2000 and2001, respectively, and additional life insurance coverage, as per the terms of his employment arrangement, and an amount of $21,552 paid in lieuof vacation in 2000.

In the case of Mr. Sheridan and Mr. Jarman “Other annual compensation” consists of SCPs attached to the options to acquire BCE common sharesunder the BCE Stock Option Program made upon the exercise of such options, and for Mr. Jarman in 2000, a payment of $90,996 in lieu of vacation,in 2000 and 2001, payments of $43,726 and $72,814, respectively, in lieu of perquisites and housing assistance payments of $43,682 and$153,849, respectively, to account for a market differential as a result of his transfer to Washington, D.C.

For Mr. Fecan, the terms of his employment with Bell Globemedia provide that perquisites and other benefits will continue for a period of one year subse-quent to termination of his employment.

Except for Mr. Monty in 1999, 2000 and 2001 and for Mr. Jarman in 2000 and 2001, perquisites and other personal benefits for the Named ExecutiveOfficers are not included since they did not exceed minimum threshold disclosure levels in 1999, 2000 and 2001.

(3) Options granted under the BCE Stock Option Program which is described in the Report on Executive Compensation. In the case of Mr. Jarman, in 2000,he was awarded options to acquire 200,379 BCE common shares as well as options to acquire 259,839 Teleglobe common shares under the TeleglobeInc. Stock Option Plan, which represent options to acquire 236,453 BCE common shares as a result of the Teleglobe Arrangement (as defined below).[In the case of Mr. Sabia, in 2001 he was granted an additional 50,000 BCE options to bring the 2000 appointment grant of 342,900 to the level ofmultiple for his position. For 1999, he was granted options to acquire 65,000 BCE common shares as well as options to acquire 180,000 commonshares of BCI granted under the Bell Canada International Long-Term Incentive (Stock Option) Program (1997) (the ‘‘BCI Stock Option Program’’) ofwhich 90,000 were replaced by options to acquire 114,557 BCE common shares converted in accordance with a share price ratio methodology whichpreserved the existing economic interest and which are included in the options to acquire 342,900 BCE common shares granted in 2000.] For adescription of the Teleglobe Inc. Stock Option Plan and the BCI Stock Option Program refer to Teleglobe’s most recent Annual Information Form andBCI’s most recent Management Proxy Circular, respectively, filed with Canadian securities regulatory authorities.

Pursuant to the terms of his employment with BCE, in the event of his retirement, or in the event of an acquisition of control of BCE by another partyor group, all outstanding BCE stock options held by Mr. Monty will immediately vest and will be outstanding for their remaining normal term.

SCPs were attached to all options granted in 1999 to the Named Executive Officers who were granted options that year under the BCE Stock OptionProgram, except for 65,000 BCE Options granted to Mr. Sabia in 1999. Freestanding Stock Appreciation Rights (“SARs”) cannot be granted under theBCE Stock Option Program.

(4) The numbers shown represent the number of securities under options as originally granted; in connection with the subsequent distribution by theCorporation of an approximate 35% ownership interest in Nortel Networks, options to acquire common shares of the Corporation outstanding on May1, 2000 were cancelled and replaced by (a) options to acquire an equal number of common shares of the Corporation and (b) options to acquirecommon shares of Nortel Networks and the exercise prices of such options were established so as to preserve the economic value of the optionsoriginally granted, all as indicated on page 14 under the heading “Impact of Distribution by BCE of shares of Nortel Networks”.

(5) Units which are equivalent in value to BCE common shares were awarded. The number of Units awarded was determined on the basis of the averageclosing price of BCE common shares on The Toronto Stock Exchange and the Montreal Exchange on the day prior to the effective date of the award ofUnits except for the 2000 and 2001 awards which were determined on the basis of the closing price of BCE common shares on The Toronto StockExchange only on the day prior to the effective date of such awards. The dollar amount included in the summary compensation table represents thepre-tax value of the Units at the time of the award. On each BCE common share dividend payment date, additional Units are credited to the accountof the Named Executive Officers in an amount equivalent to dividends on outstanding BCE common shares. For further information, see the Reporton Executive Compensation. Aggregate holdings of Units and their value as at December 31, 2001 are as follows: Mr. Monty 143,994 Units with a valueof $5,185,258, Mr. Sabia 25,509 Units with a value of $918,614, Mr. Sheridan 18,132 Units with a value of $652,939 and Mr. Jarman 14,831 Units witha value of $534,083.

(6) The numbers of Units originally awarded have been amended to reflect the Arrangement, as described on page 14 under the heading “Impact ofDistribution by BCE of shares of Nortel Networks”.

(7) “All other compensation” includes the following payments: company contributions under the BCE Employees’ Savings Plan (1970) which is describedbelow and, in the case of Mr. Jarman, payments for life insurance premiums, for 2000, payment in lieu of company contributions under the BCEEmployees’ Savings Plan (1970) and, for January 1999, a health program allowance which is described below, and in the case of Mr. Fecan, paymentsfor life insurance premiums.


Option / SAR Grants during the most recently completed financial year

Market value of% of Total options / securities underlying

Securities under SARs granted to options / SARsName options / SARs granted employees in Exercise or base price on the date of grant Expiration date

(#) financial year ($ / Security) ($ / Security)

(1) (2) (2) (3) (2)

Jean C. Monty 650,000 5.6% $40.65 $40.65 Feb. 27, 2011Michael J. Sabia 50,000 (4) 0.4% $40.65 $40.65 Feb. 27, 2011John W. Sheridan 200,000 1.7% $40.65 $40.65 Feb. 27, 2011Terence J. Jarman 134,000 1.2% US$26.64 US$26.64 Feb. 27, 2011Ivan Fecan 100,000 0.9% $40.65 $40.65 Feb. 27, 2011Ivan Fecan 50,000 0.4% $40.45 $40.45 July 24, 2011

(1) Each option granted under the BCE Stock Option Program covers one common share of the Corporation. No Special Compensation Payments wereattached to options granted to the Named Executive Officers under the BCE Stock Option Program. The BCE Stock Option Program is described in theReport on Executive Compensation.

(2) As freestanding SARs have not been granted, the numbers relate solely to stock options.

(3) The exercise price of the stock options outlined in this table is equal to the closing price of the Corporation’s common shares on The Toronto StockExchange on the day prior to the effective date of the grant of the options. In the case of Mr. Jarman, the exercise price has been converted to USdollars using the February 27, 2001 exchange rate of 1.5259.

(4) Mr. Sabia was granted 50,000 BCE options to bring the 2000 appointment grant of 342,900 options to the level of multiple for his position.

S T O C K O P T I O N SThe following table sets forth individual grants of stock options under the BCE Stock Option Program and the Teleglobe Inc. Stock Option Plan during the financial year ended December 31, 2001 to each of the Named Executive Officers.

Under the BCE Employees’ Savings Plan (1970), employees of BCE, Bell Canada and TCC, including executive officers, are eligible to make a basic con-tribution towards the purchase of BCE common shares of up to 6% of their basic wages matched by a BCE or Bell Canada contribution of $1 for every$3 contributed by the employee and by a TCC contribution of $1 for every $2 contributed by the employee.

The health program allowance mentioned above is equal to 1.5% of salary and was paid by BCE in January 1999, to all management employees residingin the Province of Québec. In the case of Mr. Sabia, such health allowance is equal to 1.5% of salary and was paid by BCI for the years 1999 and 2000.

“All other compensation” also includes, in the case of Mr. Monty, Mr. Sheridan and Mr. Jarman gains from the exercise of SCPs under the BCE StockOption Program attached to Nortel Replacement Options received as a result of the Arrangement and exercised in 2000. In addition, in the case ofMr. Sheridan, “all other compensation” includes an amount of $75,000 which was paid by Bell Canada in 2001 for the year 2001, in 2000 for the year2000 and of $150,000 in 1999 representing an amount of $75,000 for each of the years 1998 and 1999, with respect to Mr. Sheridan’s relocationfrom Ottawa to Toronto and in the case of Mr. Jarman, an amount of $276,487 in respect of relocation expenses in 2000.


The following table sets forth details of all exercises of stock options by each of the Named Executive Officers under the BCE Stock Option Programand the Teleglobe Inc. Stock Option Plan (which stock options are exercisable for BCE common shares as a result of the arrangement involving theCorporation and Teleglobe (the ‘‘Teleglobe Arrangement’’) and the BCI Stock Option Program during the financial year ended December 31, 2001,and the financial year-end value of unexercised options on an aggregated basis.

Aggregated option / SAR exercises during the most recently completed financial year and financial year-end option / SAR values

Value of unexercisedSecurities acquired Aggregate value Unexercised options / SARs “in-the-money” options / SARs

Name on exercise realized at December 31, 2001 at December 31, 2001

(#) ($) (#) ($)

(1) (2) (3) (1) (3) (4)

Exercisable Unexercisable Exercisable Unexercisable

Jean C. Monty BCE — — 396,550 768,850 8,708,195 2,561,128Michael J. Sabia BCE — — 138,603 319,297 1,765,335 2,414,444Michael J. Sabia BCI — — 90,000 — — —John W. Sheridan BCE 13,975 395,761 45,540 399,147 — 1,314,854Terence J. Jarman BCE — — 134,921 503,094 543,442 1,309,894Ivan Fecan BCE — — — 150,000 — —

(1) Decimals, which may result from fractional shares under option due to the replacement of options or underlying securities in connection with theTeleglobe Arrangement have been omitted.

(2) The aggregate value realized is calculated using the closing prices for a board lot of common shares of the Corporation or of BCI, as the case may be, onThe Toronto Stock Exchange on the date of exercise, less the exercise price. Excludes value received as a Special Compensation Payment which is disclosedin the Summary compensation table under “Other annual compensation” and described in the Report on Executive Compensation.

(3) As freestanding SARs have not been granted, the numbers relate solely to stock options.

(4) The value of unexercised “in-the-money” options is calculated using the closing prices for a board lot of common shares of the Corporation or of BCI,as the case may be, on The Toronto Stock Exchange on December 31, 2001, less the exercise price of “in-the-money” options. “In-the-money” optionsare options that can be exercised at a profit, i.e. the market value of the shares is higher than the price at which they may be bought from theCorporation or BCI, as the case may be. The value of unexercised “in-the-money” options, in the case of Mr. Jarman, includes options granted underthe Teleglobe Inc. Stock Option Plan, the exercise price of which has been converted from U.S. dollars to Canadian dollars using the December 31, 2001exchange rate of 1.5926.

(5) As disclosed under the Report on Executive Compensation, this table does not reflect Nortel Networks Replacement Options issued to BCE ExecutiveOfficers as part of the Arrangement relating to the distribution by BCE of an approximate 35% ownership interest in Nortel Networks.

P E N S I O N A R R A N G E M E N T SNamed Executive Officers participate in the non-contributory definedbenefit pension plan of the Corporation or of Bell Canada (the “BCEPension Plan”), with the exception of Mr. Fecan who participates in theBell Globemedia Defined Contribution Pension Plan. The Corporation’sand Bell Canada’s plans are substantially similar. In addition, eligibleNamed Executive Officers (with the exception of Mr. Fecan) enter intosupplementary executive retirement agreements (“SERPs”). The follow-ing table shows estimated annual pension benefits payable, under theBCE Pension Plan and SERPs, upon retirement on December 31, 2001 atage 65, to eligible Named Executive Officers in specified average earn-ings and service classifications. In no case may an eligible officerreceive under the basic BCE Pension Plan and the SERP an annualaggregate pension benefit from BCE and its subsidiaries in excess of70% of average pensionable earnings.

Pension plan table

Pensionable Credited years of service earnings 20 30 40

$ 500,000 164,600 239,600 312,100700,000 232,600 338,600 441,100900,000 300,600 437,600 570,100

1,300,000 436,600 635,600 828,1001,700,000 572,600 833,600 1,086,1002,100,000 708,600 1,031,600 1,344,1002,500,000 844,600 1,229,600 1,602,1002,900,000 980,600 1,427,600 1,860,1003,300,000 1,116,600 1,625,600 2,118,100

Benefits shown above are not subject to any deductions forgovernment benefits or other offset amounts. The benefits are partiallyindexed annually to increases in the Consumer Price Index but in nocase can indexation exceed 4%.


The following describes the pensions payable to the eligible NamedExecutive Officers under the BCE Pension Plan, as supplemented by theSERPs:(a) Eligible Named Executive Officers are credited with an additional

0.5 year of pensionable service for each year of service as anofficer of the Corporation or of a subsidiary or associated companyof the Corporation.

(b) Pensions are based on pensionable service and the average of thebest consecutive 36 months of pensionable earnings. Pensionableearnings include salary, short-term incentive and annual share unitawards. The inclusion of such awards is subject to a maximum limit.

(c) Pensions are delivered for life with a spousal survivor benefit enti-tlement of approximately 60%.

(d) A retirement allowance equal to one year’s base salary is payableat time of retirement. (This amount is not included in computingthe officer’s pensionable earnings).

(e) Eligible officers generally become eligible to SERP benefits uponreaching: (i) age 55 or more and the sum of age and service equalsor exceeds 85; (ii) age 60 or more and the sum of age and serviceequals or exceeds 80; or (iii) age 65 and 15 years of service. Forpurposes of this paragraph (e), service excludes the additional0.5 year of pensionable service credited for each year of service ofan officer.

(f) For purposes of computing their total retirement benefits, as ofDecember 31, 2001, Mr. Monty had 38.3 years of credited service,Mr. Sabia, 9.5 years, Mr. Sheridan, 25.7 years and Mr. Jarman,26.7 years. This note sets forth additional information as of suchdate with respect to certain executive officers.

Mr. Monty, age 54, under the terms of his employment with BCEis entitled to retire at any time with pensionable earnings equal tothose determined by Nortel Networks based on his Nortel Networkssalary and bonus history unless the pensionable earnings for hisemployment at BCE exceed his pensionable earnings at NortelNetworks. At this time, Mr. Monty’s pensionable earnings areU.S. $1,575,600 (Cdn. $2,509,301 converted using the December 31,2001 exchange rate of Cdn.$1.5926 per U.S. dollar). UnderMr. Monty’s pension arrangement, if his pensionable earnings atBCE exceed his pensionable earnings at Nortel Networks, he mayelect, at time of retirement, to convert his pension to U.S. dollars atthe then prevailing exchange rate. Until age 55, the pension bene-fits will be payable by BCE on the terms and conditions set out inMr. Monty’s employment contract with Nortel Networks asdescribed in Nortel Networks’ 1998 Proxy Circular and ProxyStatement. As a result of the application of such terms and condi-tions, Mr. Monty would be eligible to receive his pension at a ratenot less than 1.3% per year of service credited. After the age of 55,the pension benefits will be payable on the BCE terms and condi-tions set out above in this section. Upon retirement from BCE, noretirement allowance is payable to Mr. Monty.

Mr. Sabia, age 48, under the terms of his offer of employment byBCE is entitled to retire at anytime from age 60. In addition, an addi-tional 6.5 years of service will be credited for the purpose ofcomputing his retirement benefit and the reduction applied to hispension for early retirement will be 1.5% per year if he retires

between the ages of 60 and 65. These additional benefits will vestat a rate of 331⁄3% per completed year of service after his date of hirefrom BCI which is October 1, 1999.

In addition, in the case of involuntary termination of employmentfor reasons other than for cause or related to Mr. Sabia’s individualperformance, Mr. Sabia would be entitled to a severance payoutequal to up to three times his annual salary plus target bonus andimmediate vesting of the special option grant made under the BCEStock Option Program in 1999.

As Chief Executive Officer of TCC until his resignation on January23, 2002, Mr. Jarman, age 50, was accruing service under thePension Plan of Bell Canada and for the purposes of his SERP withBell Canada. Mr. Jarman will continue to accrue service under thePension Plan of Bell Canada and for purposes of his SERP with BellCanada during the remainder of his paid leave of absence. See noteno. 1 to the Summary Compensation Table. His SERP eligibility crite-ria has been amended to recognize his 27 years of service.

C O M P E N S A T I O N O F D I R E C T O R SIn 2001, each director who was not an employee of BCE (hereafterreferred to as an “outside director”) was entitled to be paid $35,000 perannum for services as a director. Each outside director was also enti-tled to be paid $5,000 per annum per committee for services as amember of any standing committee of the Board and $5,000 perannum for services as chairman of any standing committee of theBoard. In all cases, outside directors were entitled to an attendance feeof $1,500 per meeting. Outside directors required to travel over 1,000kilometres from their principal residence received twice the attendancefees otherwise payable (a) for Board meetings and (b) for Committeemeetings held on a day when the Board was not meeting. Non-Canadiandirectors are entitled to be paid the foregoing amounts in U.S. dollarsconverted at par.

In 2001, Mr. Currie, for his role as lead director, was granted 30,000BCE phantom stock options for the years 2001 to 2003. He will receiveat the time of exercise of each phantom stock option, a cash paymentequal to the difference between the market price at the time of exerciseand the market price at the time of grant. The term of such phantomoptions is 10 years from the date of the grant, except in the case ofretirement, resignation or death, in which case the term is reduced inaccordance with the provisions of the BCE Stock Option Program. Theright to exercise the total number of phantom options accrues by 331⁄3%a year starting on the first anniversary from the date of grant. The otherterms of the phantom options are generally similar to the SCPs under theBCE Stock Option Program.

BCE has taken steps to align more closely the interests of its outsidedirectors with those of its shareholders. Since May 1, 1997, the retainerportion of the outside directors’ remuneration is required to be paid inthe form of share units under The BCE Inc. Share Unit Plan for Non-Employee Directors (1997) (the “Directors’ Share Unit Plan”).

The annual retainer is payable quarterly. Accordingly, each quarter,a number of share units equal to the number of shares that could bepurchased on the open market for a dollar amount equal to the quar-terly retainer fee is credited to the account maintained by theCorporation for each outside director under the Directors’ Share UnitPlan. On each BCE common share dividend payment date, dividend-like

credits in the form of share units are added to each outside director’saccount maintained under the Directors’ Share Unit Plan, to reflectdividends on BCE’s common shares. No shares are purchased on theopen market under the Directors’ Share Unit Plan until such time as anoutside director ceases to be a member of the Board of Directors.Following the cessation of an outside director ’s Board service, BCEcauses to be purchased on the open market a number of BCE commonshares equal to the outside director ’s credit balance under theDirectors’ Share Unit Plan after remittance of applicable withholdingtaxes and such shares are then delivered to the departing director.Subject to the consent of the Corporate Governance Committee (“CGC”),outside directors have, in addition, the option of causing the other feesto which they become entitled to be paid in share units under theDirectors’ Share Unit Plan.

BCE has adopted a Long-Term Incentive (Stock Option) Program forNon Employee Directors (2000) (the “Directors Stock Option Program”).The Directors Stock Option Program contemplates a one time grant of15,000 options to acquire common shares of the Corporation at the thencurrent market price, to each person who was a director at the estab-lishment of the program, or who is subsequently appointed or electedduring the five-year term of the program. In 2001, no options weregranted nor exercised under the program. In accordance with the termsof the Directors Stock Option Program, directors who ordinarily resideoutside of Canada at the time of grant may be granted options to acquirean additional 7,500 common shares of the Corporation. This latitudeexists in order to reflect the Board of Directors’ intent to ensure theCorporation’s ability to compete with other large corporations in attractingdirectors on a worldwide basis. A maximum of 375,000 common sharesare issuable pursuant to the exercise of options granted under theDirectors Stock Option Program. The exercise price for options is set at the market value of BCE’s common shares on the last trading day prior to the date of the grant. Options granted under the DirectorsStock Option Program may be exercised for a period of 10 years from thedate of the grant, or subject to early termination, three years after theretirement from the Board or death of their holder. Unless terminatedearlier by the Board, no new options may be granted under the DirectorsStock Option Program after November 22, 2005. The program mayhowever be renewed in accordance with any required corporate and regulatory approvals.

During the last completed financial year, some outside directors ofBCE also received compensation from certain subsidiaries of theCorporation for services in their capacity as directors of such sub-sidiaries. Ms. J. Maxwell and Messrs. J.E. Newall, G. Saint-Pierre andP.M. Tellier were directors of Bell Canada and Bell Canada Holdings Inc.for all of 2001. Mr. J.H. McArthur was a director of BCE Emergis for all of2001. Mrs. D. Soble Kaufman was a director of BCI for all of 2001.Mrs. D. Soble Kaufman and Mr. B.M. Levitt have been directors ofBell Globemedia since January 9, 2001. Mrs. D. Soble Kaufman andMr. B.M. Levitt were directors of Bell ExpressVu Inc. until January 17,2001. Messrs. R.J. Currie and T.E. Kierans were directors of Teleglobe forall of 2001. All the directors of BCE were directors of Telesat Canada forall of 2001.

Directors’ fees, including both retainers and attendance fees, are nolonger paid to BCE directors who are officers of BCE and who serve onthe boards of directors of BCE’s subsidiary companies. Such fees areeither paid directly to BCE or not paid at all.



Annual retainer Attendance fees

Subsidiaries Board of Directors Committees Committee Chairman Board of Directors Committees

Bell Canada (1) $23,000 $4,000 $4,000 $1,000 $1,000BCI (2) US$20,000 – US$1,000 US$ 750 US$ 500BCE Emergis (3) $20,000 $1,000 $1,000 $ 500 $ 500Bell Globemedia (4) $23,000 – – $1,000 –Teleglobe (5) $23,000 $4,000 $4,000 $1,000 $1,000

(1) The Bell Canada share unit plan was amended in 2001 in order to facilitate the movement of directors among Boards of Directors within the BCE groupof companies. The amendments do so by recognizing service on other Boards of Directors in the BCE group of companies and permit participatingdirectors to transfer the share units earned under the Bell Canada share unit plan to their account under the BCE share unit plan. Once so transferred,the share units are thereafter governed by the BCE share unit plan and are cancelled under the Bell Canada share unit plan.

(2) BCI has established a share unit plan for directors of BCI who are not employees of BCI, BCE or their subsidiaries. Under this plan, 50% of the annualretainer fee of U.S. $20,000 is paid in share units (“BCI Units”), each of which is equivalent in value to one BCI common share. Following cessation ofservice on BCI’s Board of Directors, BCI Units will be paid to the director in BCI common shares or in cash, at BCI’s discretion, and after remittance ofapplicable withholding taxes. The other fees to which directors become entitled may, subject to the consent of BCI’s Corporate Governance Committee,also be paid in the form of share units under the share unit plan.

(3) BCE Emergis has established a share unit plan for directors of BCE Emergis who are not employees of BCE Emergis, BCE or their subsidiaries. Under theplan, 100% of all fees, other than attendance fees, paid to directors are paid in share units (“BCE Emergis Units”), each of which is equivalent in value toone BCE Emergis common share. Following cessation of service on BCE Emergis’ Board of Directors, BCE Emergis Units will be paid to the director in BCEEmergis common shares after deduction of applicable withholding taxes or in cash, based on the market value of the common shares, net of applicablewithholding taxes. Under this plan, attendance fees may also be paid in the form of share units at the election of the director. Mr. J.H. McArthur waselected to the Board of Directors of BCE Emergis on, and has been participating in this plan since, March 28, 2000. In addition, options to acquire commonshares of BCE Emergis may be granted to directors of BCE Emergis. However, following a policy adopted by the board of directors of BCE Emergis in 2000,an outside director may not be granted more than 25,000 stock options upon joining the board of directors of BCE Emergis and more than 5,000 stockoptions annually.

(4) BCE directors who serve as directors of Bell Globemedia may elect to receive directors fees under the form of BCE Share Units.

(5) BCE directors who serve as directors of Teleglobe may elect to receive directors fees under the form of BCE Share Units.

STATEMENT OF CORPORATE GOVERNANCE PRACTICES

BCE seeks to attain high standards of corporate governance as theBoard of Directors and Management of BCE believe that good corporategovernance practices tend to contribute to the creation and mainte-nance of shareholder value while poor ones may undermine it. TheBoard of Directors has carefully considered the corporate governanceguidelines adopted by The Toronto Stock Exchange (“TSE”) and believesthat BCE is well aligned with all the recommendations contained in the guidelines. BCE’s corporate governance practices contemplate that each outside director should be invited to sit on at least one of BCE’s board committees. The current members of the threeBCE board committees, all of which are outside, unrelated directors, areindicated below:

Mr. R. J. Currie is Chairman of the MRCC and a member of the CGC.Mr. A. S. Fell is a member of the Audit Committee. Mrs. D. Soble Kaufmanis a member of the Audit Committee. Mr. T. E. Kierans is a member of theAudit Committee. Mr. B. M. Levitt is a member of the MRCC. Ms. J. Maxwellis a member of the Audit Committee. Mr. J. H. McArthur is a member of the MRCC and of the CGC. Mr. J. E. Newall is the Chairman of the Audit Committee and a member of the CGC. Mr. R.C. Pozen is amember of the MRCC. Mr. G. Saint-Pierre is the Chairman of the CGC.Mr. P. M. Tellier is a member of the MRCC. Mr. V. L. Young is a member ofthe Audit Committee.

In order to provide an effective process for BCE to supervisethe businesses of its subsidiaries and associated companies, BCE’scorporate governance practices also envisage that each BCE outsidedirector shall be invited by the BCE CGC to sit on the board of directorsof at least one of BCE’s principal business units.

At the date hereof, the following outside directors sit on the board ofdirectors of the BCE group of companies indicated below:

Director BCE group of Companies

Mr. Richard J. Currie Teleglobe, Telesat CanadaMr. Anthony S. Fell Teleglobe, Telesat CanadaMr. Thomas E. Kierans Teleglobe, Telesat CanadaMr. Brian M. Levitt Bell Globemedia, Telesat CanadaMs. Judith Maxwell Bell Canada, Telesat CanadaMr. John H. McArthur BCE Emergis, Telesat CanadaMr. J. Edward Newall Bell Canada, Telesat CanadaMr. Robert C. Pozen Telesat CanadaMr. Guy Saint-Pierre Bell Canada, Telesat CanadaMrs. Donna Soble Kaufman BCI, Bell Globemedia, Telesat CanadaMr. Paul M. Tellier Bell Canada, Telesat CanadaMr. Victor L. Young Telesat Canada

The following description summarizes BCE’s corporate governancepractices indicating where appropriate, by means of footnotes, thenumber of the corresponding TSE guideline.


M A N D A T E O F T H E B O A R DThe Board of Directors has overall responsibility for the managementand supervision of the management of the affairs of the Corporation.The Board has established an administrative procedure whichprescribes the rules governing the approval of transactions carried outin the course of the Corporation’s operations, the delegation of authorityand the signing or execution of documents on behalf of the Corporation.For instance, the appointment of officers as well as the authorization ofinvestments and expenditures above a certain dollar threshold aresubject to review and approval by the Board(1).

In performing its responsibilities, the Board, a committee of theBoard or an individual director may, as required, and subject to theapproval of the Chairman of the CGC, engage an outside adviser at theexpense of the Corporation(2).

More specifically, the Board assumes the following principal respon-sibilities(3):(i) Strategic Planning (Corporate Mandate)(4): The Board of Directors

approves BCE’s corporate strategy. One meeting of the Board ofDirectors per year is set aside for a substantial strategic planningreview and a subsequent session later in the same year considersand approves BCE’s strategies and business plan and annualbudget. Key objectives of the strategy as well as quantifiable financial targets taken from the business plan and annual budget are incorporated into an annual management mandate(Corporate Mandate) and approved at a Board meeting early in thefollowing year.

(ii)Succession Planning, including Appointing, Training and MonitoringSenior Management(5): As part of its mandate, the Board ofDirectors focuses on the integrity, quality, and continuity ofmanagement required to attain the Corporation’s goals. The MRCCreviews and reports to the Board of Directors on successionplanning, on senior management appointments and developmentand on the performance of management in relation to the CorporateMandate at six-month intervals. Annually, the MRCC measuresmanagement’s performance and compensation against the com-bined set of objectives comprised in the Corporate Mandate. A moredetailed description of the role played by the MRCC may be foundhereinafter under Board committees and particularly under THEMANAGEMENT RESOURCES AND COMPENSATION COMMITTEE.

(iii)Monitoring of Financial Performance, Financial Reporting and RiskManagement(6): The Audit Committee reviews, reports and providesrecommendations to the Board of Directors on financial perfor-mance, financial reporting and risk management. See Boardcommittees and particularly THE AUDIT COMMITTEE for a descriptionof the activities of the Audit Committee.

(iv)Communications Policy(7): The Board approves periodically a com-munications plan to address communications with shareholders,employees, financial analysts, governments and regulatory author-ities, the media and the Canadian and international communities.Procedures for receiving feedback from shareholders have alsobeen developed. For instance, in addition to the annual meeting,

lines of communication (meetings, conferences, press releases andquarterly conference calls) have been established with the invest-ment community and the media to explain BCE’s results andcorporate strategy as well as to answer questions. BCE also has atoll free number for shareholder enquiries 1-800-561-0934 and forinvestor relations 1-800-339-6353. In addition, BCE presents detailedinformation on its business on the BCE website (www.bce.ca).

C O M P O S I T I O N O F T H E B O A R DAs of March 30, 2002, the Board is composed of thirteen directors, allof whom were throughout 2001 outside and unrelated directors, exceptMr. J.C. Monty, the Chairman and Chief Executive Officer of theCorporation (Mr. A. S. Fell and Mr. R. C. Pozen were appointed to the BCEBoard in January 2002 and February 2002, respectively; they are bothalso outside and unrelated directors). The unrelated directors repre-sent a wide variety of business sectors. Certain directors may bepartners in or officers of entities that provide legal, financial or otherservices to the corporation or its subsidiaries. These directors are con-sidered unrelated given that such services are provided on customarycommercial terms by such entities and received by the Corporation orits subsidiaries in the ordinary course of their respective businessesand the ability of the Corporation or its subsidiaries to obtain suchservices from any one of such entities in particular is not consideredmaterial to the Corporation and its subsidiaries on a consolidatedbasis.(8)

The Board of Directors’ objective, with respect to its composition, isto have a sufficient range of skills, expertise and experience to ensurethat the Board can carry out its functions effectively and to have a rea-sonable geographical representation in relation to BCE’s shareholders.Directors are selected for their ability to contribute on the broad rangeof issues with which the Board of Directors must deal. The Board ofDirectors of the Corporation reviews, through the CGC, the contributionsof the directors and determines whether its size promotes effective-ness and efficiency. BCE’s Board of Directors believes that the Boardhas optimal size to promote effectiveness and efficiency(9).

The CGC receives suggestions for candidates from individual Boardmembers, the Chief Executive Officer, shareholders, as well as profes-sional search organizations. A guideline for the selection of directorsprovides that directors elected for the first time after 1996 will committo being available for a minimum period of five-years, and will not nor-mally be eligible to stand for re-election if they have served on theBoard for a period of 10 successive one-year terms. Former ChiefExecutive Officers of the Corporation may be invited to serve on theBoard for a period not to exceed a total of three successive one-yearterms after retirement. The CGC is also charged with the administrationof BCE’s directors’ attendance policy, pursuant to which BCE’sCorporate Secretary must report to the CGC the name of any directorwho held his or her position during the entire previous year and who didnot attend 75% of the Board and Committee meetings. The CGC mustassess whether the director ’s attendance record is due to health orother exceptional non-recurring reasons and must take into account itsassessment of the director’s attendance record in recommending tothe Board the list of nominees for election as directors at the nextannual meeting of shareholders(10).

(1) TSE guidelines No. 1 and 11(2) TSE guideline No. 14(3) TSE guideline No. 11(4) TSE guideline No. 1(a),(5) TSE guideline No. 1(c)

(6) TSE guideline No. 1(b)(7) TSE guideline No. 1(d)(8) TSE guidelines No. 2 and 3(9) TSE guidelines No. 4 and 7

(10) TSE guideline No. 12


I N D E P E N D E N C E O F T H E B O A R D ( 11 )

The Corporation’s By-Laws provide that the directors may determinefrom time to time whether the Chairman (i) shall not be an officer andshall act solely in a non-executive capacity or (ii) shall be an officeracting in an executive capacity. Should the Board decide that theChairman shall be an officer of the Corporation acting in an executivecapacity, the Board would then designate one of its members as the“lead director” with the responsibility of ensuring that the Board canfunction independently of Management.

For the time being, the Board decided that the chair should not beseparate from Management. Given that the Chairman of the Board is anexecutive position, the Board appointed a lead director, Mr. Currie, who,as a non-employee director, has responsibility to ensure that the Boardcan function independently of Management. It is the practice of the BCEBoard to meet without Management at regularly scheduled Board meet-ings. In addition, directors can add items to Board agendas which aredistributed in advance of meetings and agendas for committee meetingsare under the responsibility of the chairman of such committees.Furthermore, the Board meets without the Chief Executive Officer whenhis performance and compensation are discussed and, finally, there isa process (which includes a questionnaire distributed to directors by theChairman of the CGC) by which feedback is periodically sollicited fromdirectors on how the Board can operate more effectively.

G O V E R N A N C E I N F O R M A T I O N F O R D I R E C T O R S ( 12 )

Upon joining the Board, directors are given the opportunity to meetwith members of senior management to familiarize themselves withthe business of the Corporation and are provided with a “ReferenceBook for Directors” which is periodically updated and contains informa-tion about the history and current status of BCE, the special legislationaffecting BCE, BCE’s investments, shareholders and Code of Conduct,as well as the governance and mandate of the Board and of its commit-tees and the directors’ duties and liabilities.

B O A R D C O M M I T T E E SThere are three standing committees of the Board of Directors: theAudit Committee, the CGC and the MRCC. These committees meet atpreset times throughout the year. Additional meetings are held asrequired. The Audit Committee met eight times in 2001, the CGC fourtimes, and the MRCC four times. The Audit Committee is composed ofsix members, the CGC of four members and the MRCC of five members.Each committee is composed exclusively of outside (i.e., non-manage-ment) directors and of unrelated directors ( 1 3 ) .

T H E C O R P O R A T E G O V E R N A N C E C O M M I T T E E ( 1 4 )

The CGC reviews, reports and, where appropriate, provides recommen-dations to the Board on: candidates for election to the Board ofDirectors and matters of corporate governance including standards ofperformance for directors; the size of the Board; tenure of directors;performance of directors; directors’ remuneration in relation to currentcompensation practices; the structure, responsibility and compositionof Board committees; and the merits of shareholder proposals. The CGCalso undertakes periodic surveys of all directors to allow each director

to assess the effectiveness of the Board as well as to appraise his orher own participation on the Board. It reports to the Board periodicallyon the Board’s assessment of its effectiveness. It also assists newlyappointed Board members in becoming acquainted with theCorporation and its governance process.

T H E M A N A G E M E N T R E S O U R C E S A N D C O M P E N S A T I O N C O M M I T T E E ( 1 5 )

The MRCC reviews, reports and, where appropriate, provides recommen-dations to the Board on: the appointment of the Chief Executive Officerand other officers; existing management resources and successionplans for officers and other management ranks; the performance of theChief Executive Officer and other officers; the Corporation’s executivecompensation policy and the compensation of the Chief Executive Officerand other officers; and any proposed major changes in organization orpersonnel, or changes to the Corporation’s pension and benefit plans.

T H E A U D I T C O M M I T T E E ( 1 6 )

The roles and responsibilities of the Audit Committee are specificallyset forth in BCE’s Administrative Resolution. The Audit Committeereviews, reports and, where appropriate, approves or provides recom-mendations to the Board on: the annual and interim consolidatedfinancial statements (including the related management discussionand analysis) and the integrity of the financial reporting of theCorporation; the adequacy of the Corporation’s processes for identify-ing and managing risk; the adequacy of its internal control system; theadequacy of its processes for complying with laws and regulations; theappropriateness of, and compliance with, the policies and practices ofthe Corporation relating to business ethics; the appointment, terms ofengagement, independence and proposed fees of the Corporation’sauditors; the appointment and mandate of the internal auditor; the relationship between related entities’ audit committees and that of theCorporation; and the relationship between the Audit Committee, otherstanding committees of the Board and Management. The Audit Committeehas direct communication channels with the internal and external auditors to discuss and review specific issues as appropriate. In 2001,the aggregate amounts paid for professional services rendered byBCE’s auditors, Deloitte & Touche LLP (“D&T”), and its affiliates to BCEand its subsidiaries were approximately $10.5 million for audit ser-vices, $20 million for financial information systems design andimplementation and $17.2 million for all other services; the compara-tive figures for 2000 were approximately $8.2 million, $15.2 millionand $9.1 million, respectively. The $17.2 million of other non-auditservices in 2001 included approximately 54% of services which, in theopinion of BCE’s management, relate to audit and accounting types ofservices arising out of D&T’s ongoing audit work for BCE and its subsidiaries. Deloitte Touche Tohmatsu (the global Deloitte & Touchefirm) announced on February 6, 2002 its intent to separate its auditand consulting businesses. One unit will provide mainly audit and auditrelated services (“D&T Auditing”), and the other unit will provide mainlyfinancial consulting services (“D&T Consulting”). As a result of thisseparation which is scheduled to occur in 2002, it is expected thatfinancial information systems design and implementation services willno longer be rendered by D&T Auditing to BCE and its subsidiaries.

The Audit Committee also advises the Board of Directors on policywith respect to the administration, funding and investment of theCorporation’s pension plan (the “Plan”) and fund (the “Fund”) and the

(11) TSE guidelines No. 4, 5 and 12(12) TSE guideline No. 6(13) TSE guidelines No. 4, 5, 8, 9, 10 and 13

(14) TSE guidelines No. 4, 5, 6, 7, 8 and 10(15) TSE guidelines No. 1(c) and 11(16) TSE guidelines No. 1(b), 1(e) and 13

unitized pooled fund sponsored by the Corporation for the collectiveinvestment of the Fund and participating subsidiaries’ pension funds(the “Master Fund”). More particularly, the Audit Committee reviews theimpact of the Plan liabilities and funding of proposed changes to bene-fits under the Plan; approves long-term funding objectives in relation tothe Plan liabilities; approves the appointment or removal of the actuaryof the Plan; and with respect to the Plan, the Fund and the Master Fund,reviews the system in place for carrying out the Corporation’sresponsibilities as employer and administrator of the Plan, the Fundand the Master Fund, including supervision and monitoring procedures,and reports to the Board of Directors on its appropriateness; approveschanges to the investment policies and goals to be followed in theinvestment of the Fund and the Master Fund; reviews the investmentperformance of the Fund and the Master Fund; and reviews and approvesthe audited financial statements of the Fund and the Master Fund.

The New York Stock Exchange (“NYSE”) has recently adopted newlisting standards relating to the effectiveness of audit committees.While BCE is not required to comply with the new NYSE rules, BCE generally expects to comply with the composition and expertiserequirements of the new NYSE listing standards, which require eachaudit committee to consist of at least three directors, all of whom haveno relationship to the company that may interfere with the exercise of their independence from management and the company, eachmember of the audit committee to be financially literate and at least one member of the audit committee to have accounting or related financial management expertise. BCE’s Audit Committee meetsall three requirements.

DIRECTORS’ AND OFFICERS’ LIABILIT Y INSURANCE

Directors’ and Officers’ liability insurance in the aggregate amount ofU.S. $280 million (approximately Cdn. $446 million) is purchased forthe protection of all the directors and officers of the Corporation, itssubsidiaries and certain of its associated companies against liabilityincurred by such directors and officers. In 2001, the aggregate amountcharged against earnings by the Corporation for its portion of thepremium paid in respect of its directors and officers as a group wasCdn. $851,215. In any case in which the Corporation is not permitted bylaw to reimburse the insured, the deductible is nil. Where theCorporation is permitted to reimburse the insured, the deductible isU.S. $1,000,000 (approximately Cdn. $1.6 million).

ADDITIONAL INFORMATION

The following documents are available to any person upon request.Requests should be addressed to the Corporate Secretary of BCE, at1000, rue de La Gauchetière Ouest, Suite 3700, Montréal, Québec,Canada H3B 4Y7:(a)one copy of BCE’s latest Annual Information Form, together with one

copy of any document, or the pertinent pages of any document,incorporated by reference therein;

(b)one copy of the comparative financial statements of BCE for its mostrecently completed financial year together with the accompanyingreport of the auditors thereon, both contained in the most recentBCE Inc. Annual Report, and one copy of any interim financial state-ments of BCE subsequent to the financial statements for its mostrecently completed financial year; and

(c)one copy of the management proxy circular for the most recentannual meeting of shareholders.Since 1994, Canadian ownership and control regulations (the

“Regulations”) are prescribed under the Telecommunications Act. Tomaintain the eligibility of Bell Canada and certain of its subsidiaries toact as Canadian common carriers under the Telecommunications Act,the level of non-Canadian ownership of BCE’s voting shares cannotexceed 331⁄3 % and BCE may not be otherwise controlled by non-Canadians. The Regulations under the Telecommunications Act giveBCE, as the holding corporation for Canadian common carriers such asBell Canada, certain powers to monitor and control the level of non-Canadian ownership of its voting shares. Such powers include the rightto refuse to register a transfer of voting shares to a non-Canadian, toforce a non-Canadian to sell his or her voting shares and to suspend thevoting rights attached to that person’s shares, if that person’s holdingwould jeopardize BCE’s status as a “Canadian” under the Regulations.In 1996, the federal government brought the Canadian ownershiprules for broadcasting licensees, such as CTV, (a subsidiary of BCE)generally in line with the foregoing rules for Canadian common carri-ers by raising the maximum allowable investment in voting sharesfrom 20% to 331⁄3% at the holding company level. However, reflectingcultural concerns over increased foreign control of broadcasting activ-ities, a restriction was introduced that prevents a holding companythat exceeds the former 20% limit or its directors from exercisingcontrol or influence over any programming decisions of a subsidiarylicensee. To the best of BCE’s knowledge, the level of non-Canadianownership of BCE’s common shares was approximately 10.4 % per centas at March 30, 2002. BCE monitors and periodically reports on thelevel of non-Canadian ownership of its common shares.

2003 SHAREHOLDER PROPOSALS

Shareholder proposals must be submitted no later than December 30,2002 to be considered for inclusion in next year’s Management ProxyCircular for the purposes of BCE’s 2003 Annual Meeting of shareholders.

I, the undersigned, Corporate Secretary of BCE Inc., hereby certify that the contents of this Management Proxy Circular, includingSchedule “A” and Schedule “B” hereto, and the sending thereof to eachshareholder entitled to receive notice of and vote at the Meeting, toeach director and to the auditors of the Corporation were approved bythe Board of Directors of the Corporation effective March 30, 2002.

Marc J. RyanCorporate Secretary

Certified at Montréal,this 30th day of March, 2002



SCHEDULE “A”

Resolved, as a special resolution:

1. THAT the Corporation be and it is hereby authorized and directed toapply for a Certificate of Amendment under Section 173 of the CanadaBusiness Corporations Act to amend its Articles in order to provide forthe possibility of holding annual meetings of shareholders of theCorporation at places outside Canada;

2. THAT the Articles of the Corporation be amended by inserting thefollowing immediately after the last paragraph of Item 7 thereof:

“The annual meeting of shareholders of the Corporation (whether or notalso held as a special meeting) may be held outside Canada, in the fol-lowing places:

a) the greater metropolitan area of any of the following cities in theUnited States of America: Boston (Massachusetts), Chicago(Illinois), Dallas (Texas), Denver (Colorado), Detroit (Michigan),Houston (Texas), Los Angeles (California), Miami (Florida), New York(New York), Philadelphia (Pennsylvania), San Francisco (California),Seattle (Washington), Washington (District of Columbia);

b) the greater metropolitan area of any other city in the United Statesof America which is the capital of any State of the United States ofAmerica;

c) the greater metropolitan area of any city which is the capital of anymember-country of the European Union; or

d) to the extent permitted by the Canada Business Corporations Act,any other city outside Canada designated from time to time by theBoard of Directors of the Corporation in connection with the thennext annual meeting of shareholders”.

3. THAT the directors of the Corporation be authorized to revoke thisspecial resolution before it is acted on without further approval of theshareholders of the Corporation; and

4. THAT any officer or the Assistant Corporate Secretary of theCorporation be and each of them is hereby authorized, for and onbehalf and in the name of the Corporation, to sign and deliver alldocuments and to take such action as such person may consider to be necessary, desirable or useful to carry out the intent and purposeof this resolution.

SCHEDULE “B”

RESOLVED, as an ordinary resolution, that By-Law One of BCE Inc. inthe form attached as Appendix 1 hereto, is hereby confirmed as a by-law of BCE Inc.

APPENDIX 1

BY-LAW ONEA by-law to regulate generally the business and affairs of theCorporation

PART 1SHAREHOLDERS

Section 1.01 Meetings – Subject to the laws governing theCorporation and the Articles of the Corporation, meetings of share-holders of the Corporation may be held at such place and at such timeas the directors, the Chairman of the Board or the President, if he is adirector, shall determine.

Section 1.02 Notice of Meetings and Documentation – Notice ofthe time and place of a meeting of shareholders shall be sent not lessthan 21 days nor more than 60 days before the meeting to each share-holder entitled to vote at the meeting, to each director and to theauditors of the Corporation. Where there is more than one person regis-tered as a shareholder in respect of any share or shares, such noticemay be given to whichever of such persons is named first in the secu-rities register of the Corporation and any notice so given shall besufficient notice to all of them.

Notice of shareholder meetings or any other notices or documentsintended for shareholders may be given by prepaid mail, facsimile, orby any electronic or other communication facilities. The Board ofDirectors may establish, by resolution, procedures to give, deliver orsend a notice or other document to the shareholders, directors and audi-tors by any means permitted under the laws governing the Corporationor pursuant to the Articles or by-laws of the Corporation. In the eventthat it is impossible or impracticable for any reason whatsoever to givenotice as otherwise permitted under the laws governing theCorporation, notice may be given by advertisement published once in anewspaper in such cities or places as the directors may from time totime determine.

Subject to applicable laws, a notice or other document shall bedeemed to have been given, delivered or sent (i) when it is deliveredpersonally or to the recorded address pursuant to Section 1.13 hereof;(ii) when it has been deposited in a post office or post office letter box;or (iii) when it has been dispatched or delivered for dispatch by meansof facsimile, electronic or other communication facilities.

Section 1.03 Omission of Notification – The accidental omission togive, deliver or send any notice to any shareholder, director or auditoror the non-receipt of any notice by any such person or any irregularityor error in any notice or in the giving, delivery or sending thereof shallnot invalidate any action taken at any meeting held pursuant to suchnotice or otherwise founded thereon.

Section 1.04 Participation by Electronic Means – Any person enti-tled to attend and vote at a meeting of shareholders may (i) vote at themeeting in person or by proxy (and, subject to any determinationsmade from time to time by the directors, may appoint a proxy by anymethod permitted by law, including over the Internet, by the input ofdata using telephonic facilities or by reproduction using facsimile orelectronic facilities) and (ii) may participate in the meeting by meansof telephonic, electronic or other communication facilities that permitall participants to communicate adequately with each other during themeeting, if the Corporation makes available such communication facilities.

Section 1.05 Meetings by Electronic Means – The Board of Directorsmay determine the manner in which meetings of shareholders shall beheld (either at a specified place, or by means of telephonic, electronicor other communication facilities that permit all participants to com-municate adequately with each other, or a combination of theforegoing), as permitted by the laws governing the Corporation and theArticles of the Corporation; and when calling a meeting of shareholders,the Board of Directors may determine that such meeting will be heldentirely by means of such telephonic, electronic or other communicationfacilities; provided that all participants shall be able to communicateadequately with each other during the meeting.

Section 1.06 Quorum – Except as otherwise provided in the Articlesof the Corporation, the holders present in person or by proxy of not lessthan 20% of the outstanding shares of the Corporation entitled to bevoted at a meeting of shareholders shall constitute a quorum.

If a quorum is not present within 30 minutes of the opening of themeeting, the meeting shall be adjourned to such date, not less than15 days nor more than 30 days thereafter, and to such time and placeas may be designated by the chairman of the meeting, and except asrequired by the laws governing the Corporation, it shall not be neces-sary to give notice of the adjourned meeting other than byannouncement at the earlier meeting that is adjourned and by adver-tisement in each newspaper in which notice of the record date for theoriginal meeting was published. Notwithstanding the foregoing, theCorporation shall not be required to announce by way of advertisementin newspapers the adjournment of the meeting to a date not more thanthree business days after the original meeting to the extent that theonly item of business at such adjourned meeting is the designation bythe chairman of a date, time and place for a further adjournment of themeeting. At any adjourned meeting, the holders of shares of theCorporation present in person or by proxy, whether they hold more orless than 20% of the outstanding shares of the Corporation entitled tovote at the meeting, shall constitute a quorum and may transact thebusiness and any amendments thereto for which the meeting was orig-inally called, and any other business which may come properly beforesuch adjourned meeting.

A person participating in a meeting by means of telephonic, elec-tronic or other communication facilities shall be deemed for thepurposes hereof to be present at the meeting.

Section 1.07 Chairman of Meeting – The Chairman of the Board, or inhis absence, the lead director, if any, appointed under Section 2.07hereof, or in his absence, the President, if he is a director, or in his absence, any officer who is a director, or in his absence, any

Vice-President who is a shareholder, shall preside as chairman at anymeeting of the shareholders. If all of the foregoing be absent, thepersons present and entitled to vote at said meeting shall choose oneof their number to act as chairman of the meeting.

Section 1.08 Procedure at Meetings – The chairman of any meetingof shareholders shall conduct the meeting and shall determine the pro-cedure thereof in all respects. The decision of the chairman on all mattersor things, including but without in any way limiting the generality of theforegoing, any question regarding the validity or invalidity of any instru-ments of proxy, shall be conclusive and binding upon the meeting.

Section 1.09 Persons entitled to be present – The only personsentitled to attend a meeting of shareholders shall be those entitled tovote thereat, the directors, the auditors and others who, although notentitled to vote, are entitled or required under the laws governing theCorporation or the Articles of the Corporation to be present at themeeting. Any other person may be admitted by permission of the chair-man of the meeting or with the consent of the meeting.

Section 1.10 Scrutineers – The chairman of a meeting of shareholdersmay, or if a ballot is to be taken shall, appoint one or more persons, whoneed not be shareholders, to act as scrutineers at any such meeting.

Section 1.11 Voting – Voting at any meeting of shareholders shall beby a show of hands by holders present (or represented by proxy) atsuch meeting except where, either before or after any vote by show ofhands a ballot is required by the chairman of the meeting or isdemanded by any person present and entitled to vote at the meeting. Arequirement or a demand for a ballot may be withdrawn at any timeprior to the taking of the ballot. Any ballot shall be taken in such mannerand either at once or after adjournment, as the chairman of the meetingshall direct. Unless otherwise required by law or by the Articles of theCorporation, a majority of the votes cast shall be sufficient for all pur-poses and shall be the decision of the meeting. A declaration by thechairman of any meeting that a vote taken upon a question has beencarried or carried unanimously or by particular majority, or lost or notcarried by a particular majority, shall be conclusive evidence of thefact. In case of an equality of votes either upon a show of hands or upona ballot, the chairman of the meeting shall be entitled to a casting votein addition to the vote or votes to which the chairman is entitled as ashareholder or proxyholder. Where there is more than one person regis-tered as a shareholder in respect of any share or shares and if morethan one of such persons be present at any meeting in person or byproxy, that one of the said persons so present whose name stands firstin the securities register of the Corporation in respect of such share orshares shall alone be entitled to vote in respect thereof.

To the extent permitted by the by-laws or the Articles of theCorporation or by the laws governing the Corporation, the directors mayestablish, in connection with any meeting of shareholders, proceduresregarding voting at the meeting by means of telephonic, electronic orother communication facilities, and make available such communica-tion facilities consistent with those procedures. The directors maydetermine from time to time that the voting at any specific meetingshall be held entirely by such means.



Section 1.12 Dividends and Other Amounts – A dividend or otheramount payable in cash with respect to the outstanding shares of theCorporation may be paid by cheque drawn on a financial institution orby electronic means to or to the order of each registered holder ofshares of the class or series in respect of which it is to be paid. Chequesmay be sent by prepaid ordinary mail or delivered to such registeredholder at his address as recorded in the securities register of theCorporation, unless such holder has otherwise directed. In case of jointholders, a cheque shall, unless such joint holders have otherwisedirected, be made payable to the order of all such joint holders and ifmore than one address is recorded in the securities register of theCorporation in respect of such joint holding, a cheque shall be mailed ordelivered to the first address so recorded. The mailing or delivery ofsuch cheque as aforesaid, unless the same is not paid on due presen-tation, shall satisfy and discharge all liability for the dividends (or otheramounts) for the sum represented thereby plus the amount of any tax,levy or duty which the Corporation was required to and did withhold. Inthe event of non-receipt of any cheque by the person to whom it is sentas aforesaid, the Corporation shall issue to such person a replacementcheque for a like amount upon such terms as to indemnity, reimburse-ment of expenses and evidence of non-receipt as the directors or anyofficer or agent designated by them may from time to time prescribe,whether generally or in any particular case.

Dividends or other amounts payable in cash with respect to the out-standing shares of the Corporation may be paid to shareholders inCanadian currency or in equivalent amounts of a currency or currenciesother than Canadian currency. The Board of Directors may declare divi-dends or other amounts in any currency or in alternative currenciesand make such provisions as it deems advisable for the payment ofsuch dividends or other amounts.

Section 1.13 Addresses of Shareholders – Every shareholder shallfurnish to the Corporation or to any agent appointed by the Corporationan address to which all notices and documents intended for the share-holders shall be sent by prepaid mail or hand delivery. If a shareholderfails to furnish such an address, the address of such shareholder shallbe deemed to be that of the office at which the central securities regis-ter of the Corporation is maintained; provided that the Treasurer maychange or cause to be changed the address of any shareholder in accor-dance with any information believed by him or her to be reliable.

The Corporation may maintain a supplemental list of shareholderswho consent to receive notices or documents intended for the share-holders by means of electronic or other communication facilities. Suchsupplemental list and the electronic addresses contained therein shallnot be included in, and shall be deemed not to form part of, the securi-ties register required to be maintained by the Corporation or theshareholders’ lists or supplemental shareholders’ lists required to befurnished by the Corporation in certain circumstances. In the eventthat the Corporation is unable to deliver, in accordance with such sup-plemental list, notices or documents required to be delivered by thelaws governing the Corporation or pursuant to the Articles or by-laws ofthe Corporation to a shareholder at the electronic address provided tothe Corporation, the Corporation shall deliver such notices or docu-ments at the address of such shareholder maintained in the securitiesregister in accordance with the first paragraph of this Section 1.13.

PART 2DIRECTORS

Section 2.01 Election and Term of Office – The directors shall beelected at each annual meeting of shareholders, except as otherwiseprovided by the laws governing the Corporation. Each director shall holdoffice (i) until the next annual meeting; (ii) until such person ceasesto be a director as provided by the Articles of the Corporation or thelaws governing the Corporation; or (iii) until the resignation of suchdirector becomes effective, that is, at the time a written resignation issent to the Corporation or at the time specified in the resignation,whichever is later.

Section 2.02 Time, Place and Notice of Meetings – As soon as maybe practicable after the annual meeting of shareholders in each year, ameeting of such of the newly elected directors as are then present maybe held, without notice, provided that they shall constitute a quorum,for the appointment of the officers and the election of the Chairman ofthe Board and the President of the Corporation, if he is a director, andthe transaction of such other business as may come before themeeting.

Subject to the provisions of any resolution of the directors, (i) meet-ings of the directors may be called at any time by or by order of theChairman of the Board, the President, if he is a director, any officer whois a director or any two directors; and (ii) notice of the time and placeof each meeting of the directors shall be delivered, mailed, or commu-nicated by means of telephonic, electronic or any other communicationfacilities to each director at least 24 hours, excluding holidays, beforethe time fixed for the meeting, save that no notice shall be necessary ifall the directors are present or if, either before or after the meeting isheld, those absent waive notice.

Meetings of the Board of Directors may be held at any place withinor outside Canada. In addition, meetings of the Board of Directors maybe held by means of telephonic, electronic or other communicationfacilities that permit all directors to communicate adequately with eachother during the meeting, if the Corporation makes available such com-munication facilities and in accordance with the procedures, if any, thatmay be adopted from time to time by the directors.

Section 2.03 Par ticipation to Meetings – If all the directors of theCorporation consent, a director may participate in a meeting of theBoard of Directors or of a committee of directors by means of tele-phonic, electronic or other communication facilities that permit alldirectors to communicate adequately with each other during themeeting, if the Corporation makes available such communication facil-ities and in accordance with the procedures, if any, that may beadopted from time to time by the directors.

Section 2.04 Quorum and Voting – The directors may, from time totime, fix by resolution the quorum for meetings of the directors butunless so fixed three directors shall constitute a quorum. At anymeeting of the directors, any question shall be decided by a majority ofthe votes cast. A director participating in a meeting by means oftelephonic, electronic or other communication facilities shall bedeemed for the purposes hereof to be present at the meeting.

Section 2.05 Chairman of Meeting – Subject to the provisions of anyresolution of the directors, the Chairman of the Board, or in hisabsence, the President, if he is a director, or in the absence of all ofthem, any officer who is a director, or in the absence also of any suchofficer, such director as the meeting shall select, shall act as chairmanof the meeting.

Section 2.06 Number of Directors – Subject to the provisions of thelaws governing the Corporation and of the Articles of the Corporation,the number of directors shall be as determined from time to time byresolution of the directors.

Section 2.07 Chairman of the Board – The directors may determine,as they shall deem appropriate from time to time, that the Chairman ofthe Board: (i) shall not be an officer of the Corporation and shall actsolely in a non-executive capacity; or (ii) shall be an officer of theCorporation and shall act in an executive capacity. Should the directorsat any time determine that the Chairman of the Board shall be for thetime being an officer of the Corporation and shall act in an executivecapacity, they shall as soon as practicable appoint from among them-selves a director (hereinafter referred to as the “lead director”) who isnot an employee of the Corporation or any of its subsidiaries to ensurethat the Board of Directors can function independently of managementof the Corporation.

PART 3EXECUTION OF DOCUMENTS

Section 3.01 Execution of Documents – The directors may from time totime determine the officers or other persons by whom any documentsof the Corporation shall be executed and the manner of executionthereof, including the use of reproduction by means of facsimile or elec-tronic facilities of any or all signatures and the use of the corporate sealor a reproduction thereof by means of facsimile or electronic facilities.

PART 4REPEAL

Section 4.01 Repeal – Upon the date of this By-Law becoming effec-tive, BY-LAW NO. 1 shall be repealed, provided that such repeal shall notaffect the previous operation of BY-LAW NO. 1 or affect the validity ofany act done or right, privilege, obligation or liability acquired orincurred under, or the validity of any contract or agreement made pur-suant to such BY-LAW NO. 1 prior to its repeal and provided further thatall by-laws of the Corporation previously repealed shall remainrepealed. All officers and persons acting under BY-LAW NO. 1 shall,notwithstanding its repeal, continue to act as if appointed under theprovisions of this By-Law or by the Canada Business Corporations Actand all resolutions of the shareholders or directors passed under anyrepealed by-law shall continue good and valid except to the extentinconsistent with this by-law and until amended or repealed.

BCE INVESTOR RELATIONS

Information concerning the Corporation, in addition to the documentsreferred to on page 25 of the BCE Inc. Notice of 2002 Annual and SpecialMeeting and Management Proxy Circular, is available upon request fromInvestor Relations, at 1000, rue de La Gauchetière Ouest, Suite 3700,Montréal, Québec, Canada H3B 4Y7, or by calling 1-800-339-6353. Thisadditional information includes the management’s discussion andanalysis of the first, second and third quarter results of the Corporationand the Corporation’s quarterly supplements to its earnings pressreleases. These documents, as well as the Corporation’s AnnualInformation Form, annual and quarterly reports and news releases, arealso available on the Corporation’s website (www.bce.ca).


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