Talan Holding S.A.S.

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Application for relief from the prospectus and registration requirements for certain trades made in connection with an employee share offering by a French issuer -- the issuer cannot rely on the employee exemption in section 2.24 of National Instrument 45-106 Prospectus Exemptions as the securities are not being offered to Canadian employees directly by the issuer but rather through special purpose entities -- Canadian participants will receive disclosure documents -- the special purpose entities are subject to the supervision of the local securities regulator -- Canadian employees will not be induced to participate in the offering by expectation of employment or continued employment -- there is no market for the securities of the issuer in Canada -- the number of Canadian participants and their share ownership are de minimis -- relief granted, subject to conditions.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25, 53 and 74(1).

National Instrument 45-106 Prospectus Exemptions.

National Instrument 45-102 Resale of Securities.

September 16, 2022

[TRANSLATION]

IN THE MATTER OF THE SECURITIES LEGISLATION OF QUÉBEC AND ONTARIO (the Jurisdictions) AND IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS AND IN THE MATTER OF TALAN HOLDING S.A.S. (the Filer)

DECISION

Background

The securities regulatory authority or regulator of each of the Jurisdictions (Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) for:

1. an exemption from the prospectus requirement (the Prospectus Relief) so that such requirement does not apply to trades of units (the Units) of a fund named "TALAN" (the Fund), a fonds commun de placement d'entreprise or "FCPE", a form of collective shareholding vehicle commonly used in France for the conservation and custodianship of shares held by employee-investors in employee share ownership plans, made pursuant to an Employee Offering (as defined below) to or with Qualifying Employees (as defined below) resident in the Offering Jurisdictions (as defined below) (collectively, the Canadian Employees, and Canadian Employees who subscribe for Units, the Canadian Participants); and

2. an exemption from the dealer registration requirement (the Registration Relief, and together with the Prospectus Relief, the Exemption Sought) so that such requirement does not apply to the Filer and its Local Related Entities (as defined below), the Fund, and Equalis Capital France (the Management Company) in respect of trades in Units made pursuant to an Employee Offering to or with Canadian Employees.

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the Autorité des marchés financiers is the principal regulator for this application;

(b) the Filer has provided notice that section 4.7(1) of Regulation 11-102 respecting Passport System, CQLR, c. V-1.1. r. 1 (Regulation 11-102) is intended to be relied upon in Alberta and British Columbia (together with the Jurisdictions, the Offering Jurisdictions); and

(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in Regulation 14-101 respecting Definitions, CQLR, c. V-1.1, r. 3, Regulation 11-102 and Regulation 45-106 respecting Prospectus Exemptions, CQLR, c. V-1.1, r. 21, have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a corporation formed under the laws of France. It is not and has no current intention of becoming a reporting issuer under the securities legislation of any jurisdiction of Canada. The head office of the Filer is located in France. The shares of the Filer (the Shares) and Units are not currently listed for trading on any stock exchange in Canada and there is no intention to have the Shares or the Units so listed.

2. As of the date hereof, the Filer carries business in Canada through certain local related entities that include Talan Canada Inc., Talan Conseils Canada Inc., 6362222 Canada Inc. (dba Createch) Projexia Inc., and Insum Solutions Inc. (the Local Related Entities, together with the Filer and its other related entities, the Talan Group).

3. Each Local Related Entity is controlled directly or indirectly by the Filer and is not, and has no current intention of becoming, a reporting issuer under the securities legislation of any jurisdiction of Canada. The Canadian headquarters of the Talan Group is in Québec.

4. The Filer has established a global employee offering (the 2022 Employee Offering) and expects to establish subsequent global employee offerings following 2022 for the next four years that are substantially similar (the Subsequent Employee Offerings, and together with the 2022 Employee Offering, the Employee Offerings) for Qualifying Employees (as defined below)

5. Only persons who are employees of an entity forming part of the Talan Group during the subscription period for an Employee Offering and who meet other employment criteria (the Qualifying Employees) will be allowed to participate in the relevant Employee Offering.

6. The Fund was established for the purpose of implementing the 2022 Employee Offering and the Subsequent Employee Offerings and facilitating the participation of Qualifying Employees in the Employee Offerings. There is no current intention for the Fund to become a reporting issuer under the securities legislation of any jurisdiction of Canada.

7. The Fund is a FCPE and is registered with and has been approved by the French Autorité des marchés financiers (the French AMF).

8. Under the employee share ownership plan of the Filer (the Plan), each Employee Offering will be made as follows:

a. Canadian Participants will subscribe for the Units, and the Fund will then subscribe for Shares on behalf of Canadian Participants using the Canadian Participants' contributions and the Matching Contribution from the Local Related Entities that employ the Canadian Participants.

b. The subscription price will be equal to the fair market value of the Shares as calculated by Paper Audit & Conseil, an independent expert appointed by the Filer.

c. Any dividends paid on the Shares held in the Fund will be contributed to the Fund and used to purchase additional Shares. To reflect this reinvestment, no new Units will be issued. Instead, the reinvestment will increase the asset base of the Fund as well as the value of the Units held by Canadian Participants.

d. All Units acquired by Canadian Participants will be subject to a hold period of approximately five years (the Lock-Up Period), subject to certain exceptions prescribed by French law and adopted under the offering in Canada (such as death, disability, or termination of employment).

e. At the end of the relevant Lock-Up Period, a Canadian Participant may: (i) request the redemption of his or her Units in consideration for a cash payment equal to the then fair market value of the Shares as calculated by an independent expert, or (ii) continue to hold his or her Units in the Fund and request the redemption of those Units at a later date.

f. In the event of an early exit resulting from a Canadian Participant exercising one of the exceptions to the Lock-Up Period and meeting the applicable criteria, the Canadian Participant may request the redemption of Units in the Fund in consideration for a cash payment equal to the then fair market value of the underlying Shares.

g. As indicated in paragraph 12(a) above, the Local Related Entity employing a Canadian Participant will also contribute on behalf of such Canadian Participant an amount into the Plan based on predetermined matching contribution rules (the Matching Contribution).

9. For the 2022 Employee Offering, for each contribution that a Canadian Participant makes into the Plan up to and including the Canadian dollar equivalent of [EURO]500, the Local Related Entity employing such Canadian Participant will contribute an additional 100% of such amount into the Plan on behalf of such Canadian Participant. For the portion of each contribution that a Canadian Participant makes that is equal to or greater than the Canadian dollar equivalent of [EURO]501 and up to and including the Canadian dollar equivalent of [EURO]1,000, the Local Related Entity employing such Canadian Participant will contribute an additional 50% of such amount into the Plan on behalf of such Canadian Participant. For clarity, the maximum contribution by a Local Related Entity in respect of a Canadian Participant is the Canadian dollar equivalent of [EURO]750 (i.e., 100% of the Canadian dollar equivalent of first [EURO]500 contribution and 50% of the Canadian dollar equivalent of the next [EURO]500 contribution).

10. Under French law, an FCPE is a limited liability entity. The portfolio of the Fund will consist almost entirely of Shares, but may, from time to time, include cash in respect of dividends paid on the Shares which will be reinvested in Shares and cash or cash equivalents pending investments in Shares and for the purposes of Unit redemptions.

11. The Fund is managed by the Management Company, which is a portfolio management company governed by the laws of France. The Management Company is registered with the French AMF as an investment manager and complies with the rules of the French AMF. The Management Company is not, and has no current intention of becoming, a reporting issuer under the securities legislation of any jurisdiction of Canada.

12. The Management Company's portfolio management activities in connection with an Employee Offering and the Fund are limited to subscribing for Shares from the Filer, selling such Shares as necessary in order to fund redemption requests and investing available cash in cash equivalents.

13. The Management Company is also responsible for preparing accounting documents and publishing periodic informational documents of the Fund. The Management Company's activities will not affect the underlying value of the Shares.

14. None of the entities forming part of the Talan Group, the Fund, the Management Company or any of their directors, officers, employees, agents or representatives will provide investment advice to the Canadian Employees with respect to an investment in the Shares or the Units.

15. None of the entities forming part of the Talan Group, the Management Company or the Fund are currently in default of the securities legislation of any jurisdiction of Canada.

16. Shares issued pursuant to an Employee Offering will be deposited in the Fund through Banque Fédérative du Crédit Mutuel (the Depositary), a large French commercial bank subject to French banking legislation. For any Subsequent Employee Offering, the Depositary may change. In the event of such a change, the successor to the Depositary will remain a large French commercial bank subject to French banking legislation. The Depositary carries out orders to purchase, trade and sell securities in the portfolio and takes all necessary action to allow the Fund to exercise the rights relating to the securities held in its portfolio.

17. The Management Company and the Depositary are obliged to act exclusively in the best interests of the holders of the Units (including Canadian Participants) and are liable to them under French legislation for any violation of the rules and regulations governing the FCPE, any violation of the rules of the FCPE, or for any self-dealing or negligence.

18. Participation in an Employee Offering is voluntary, and the Canadian Employees will not be induced to participate in an Employee Offering by expectation of employment or continued employment.

19. The total amount invested by a Canadian Employee pursuant to an Employee Offering cannot exceed 25% of their estimated gross annual compensation (the Employee Contribution). Amounts contributed by a Canadian Employee's employer through the Matching Contribution (as defined below) are not factored into the Employee Contribution.

20. The maximum value of Shares that may be subscribed for by the Qualifying Employees under the 2022 Employee Offering is [EURO]9,000,000 (the Maximum Offering Size). If subscriptions received from Qualifying Employees under an Employee Offering would result in an acquisition of value of Shares by the Fund in excess of the Maximum Offering Size, a reduction will be applied as follows:

a. the largest individual subscription or subscriptions will be reduced to the value of the next largest subscription;

b. if such reduction does not reduce the aggregate value of Shares subscribed for under the Employee Offering below the Maximum Offering Size, the value of the largest subscriptions, including those reduced in value pursuant to step 20.a) above, will be reduced to the value of the next largest subscription;

c. if the reduction of the subscriptions described at step 20.b) does not reduce the aggregate value of Shares subscribed for under the Employee Offering below the Maximum Offering Size, step 20.b) above will be repeated until the aggregate value of shares subscribed for under the Employee Offering is below the Maximum Offering Size.

21. Units are not transferable by holders of such Units except upon redemption and other than as reflected in the decision document.

22. The Unit value of the Fund will be calculated and reported to the French AMF on a regular basis, based on the net assets of the Fund divided by the number of Units outstanding. The value of Units will be based on the value of the underlying Shares, but the number of Units of the Fund will not correspond to the number of the underlying Shares (as dividends will be reinvested in additional Shares and increase the value of each Unit).

23. All management charges relating to the Fund will be paid from the assets of the Fund or by the Filer, as provided in the regulations of the Fund.

24. Canadian Employees will receive an information package in the French or English language, according to their preference, which will include a summary of the terms of the Employee Offering and a description of Canadian income tax consequences of subscribing for and holding Units and requesting the redemption of such Units at the end of the applicable Lock-Up Period. Canadian Participants will have access to a copy of the rules of the Fund. Canadian Employees can have access, through their management or their human resources services, to a copy of a presentation of the Filer, its annual consolidated financial statements and audited, as well as a copy of the information documents of the Filer deposited with the French AMF relating to the Shares and the rules of the Fund. The new value of the Shares and general information on the business of the Filer will also be communicated annually to the Canadian Participants. Canadian Participants will receive an initial statement of their holdings under the Plan together with an updated statement at least once per year.

25. As at June 20, 2022, there were approximately 423 Canadian Employees of which 388 are in Québec, 33 are in Ontario, 1 is in British Columbia, and 1 is in Alberta, representing, in the aggregate, less than 8% of the number of Qualifying Employees in the Talan Group.

26. As of the date hereof and after giving effect to any Employee Offering, the Filer is and will be a "foreign issuer" as such term is defined in section 2.15(1) of Regulation 45-102 respecting Resale of Securities, CQLR, c. V-1.1, r. 20 (Regulation 45-102), section 2.8(1) of Ontario Securities Commission Rule 72-503 -- Distributions Outside Canada (OSC Rule 72-503), and section 11(1) of Alberta Securities Commission Rule 72-501Distributions to Purchasers Outside Alberta (ASC Rule 72-501).

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:

1. for the 2022 Employee Offering:

a) the prospectus requirement will apply to the first trade in any Units acquired by Canadian Participants pursuant to this decision unless the following conditions are met:

i. the issuer of the security was a foreign issuer on the distribution date, as such term is defined in section 2.15(1) of Regulation 45-102, section 2.8(1) of OSC Rule 72-503 and section 11(1) of ASC Rule 72-501;

ii. the issuer of the security:

(A) was not a reporting issuer in any jurisdiction of Canada at the distribution date, or

(B) is not a reporting issuer in any jurisdiction of Canada at the date of the trade; and

iii. the first trade is made

(A) through an exchange, or a market, outside of Canada, or

(B) to a person outside of Canada;

2. for any Subsequent Employee Offering under this decision completed within five years from the date of this decision:

a) the representations, other than those in paragraphs 2, 9, 20 and 25, remain true and correct in respect of that Subsequent Employee Offering; and

b) the conditions set out in (a) above are satisfied as of the date of any distribution of a security under such Subsequent Employee Offering (varied such that any references therein to the 2022 Employee Offering are read as references to the relevant Subsequent Employee Offering); and

3. in the Provinces of Ontario and Alberta, the prospectus exemption above, for the first trade in any Units acquired by Canadian Participants pursuant to this decision, is not available with respect to any transaction or series of transactions that is part of a plan or scheme to avoid the prospectus requirements in connection with a trade to a person or company in Canada.

"Frédéric Belleau"

Directeur principal des fonds d'investissement

Quebec Securities Commission

OSC File #: 2022/0362