PSA - 2019 Universal Registration Document

GROUPE PSA Risk factors DPEF.B

Riskfactors

Riskmanagement andcontrolprocesses

[DPEF.B] [DV.3] Diversity and equalopportunity For Groupe PSA,diversityis a sourceof addedvalue as long as equalopportunities are guaranteed. TheGroupis characterised by its diversecultures,nationalitiesand ages. The automotiveindustry is, however,still associatedwith masculine stereotypes and gender equality is not highly developed.

To redressthe biasesfoundin its businesssegment,Groupe PSA voluntarilyapplies an equal opportunitiespolicy. The Group’s priorities and commitments focus on gender diversity in skills-sets,access for women to all levels of responsibility,HR processes that guarantee equal opportunities and the deconstruction of stereotypes. By encouragingequalopportunityand foundingits practiceson objective criteria based on skills and results, the Group is encouragingthe commitmentand motivationof each employee and developing a culture of performance and economic

efficiency. (See 2.4.5)

RISKS RELATEDTO INTELLECTUALPROPERTY RIGHTS AVERAGERISK 1.5.4.4.

Riskfactors

Riskmanagement andcontrolprocesses

Withinthe contextof its businessoperations, the Groupis obliged to developnumerousinnovationswhichmay be copiedby third parties, thus depriving the Group of a legitimate economic advantage in respect ofthe technologies that it has created.

TheGrouppayscarefulattentionto protecting its creations via its intellectual property rights and legal action is taken against producersof counterfeitspare parts and any other partiesthat breachthe Group’s rights. In 2019, 1,183 new patent applications by Groupe PSAwere publishedin France. For additionalinformationon the Group’s patent policy, please r ferto paragraph 4.5.3.

Risks Related to the PSA-FCA Merger LOW RISK

1.5.5

The exchangeratio will not be adjustedfor changesin the value of PSA ordinary shares or FCA common shares or for developments in the businessof theGroupor the businessof FCA beforethemerger iscompleted. Upon the consummationof the merger, the Group’s shareholders will be entitled to receive 1.742 common shares of the combined companyfor eachPSAordinarysharethat theyown.This exchange ratio will not be adjustedfor changesin the value of PSA ordinary shares or the value of FCA commonshares, or for changesin the relativevalue of the businessof the Groupor the businessof FCA betweenthedateof thecombinationagreementandthe dateof the closingof themerger.Sharepricechangesmayresultfroma variety of factors that are beyond the control of the Group, including changesin the Group’sor FCA’s respectivebusinesses,operations or prospects,regulatoryconsiderations, legal proceedingsor in the general business,market, industryor economicconditions.Market assessmentsof the benefitsof themergerand of the likelihoodthat the mergerwill be completed,and relatedarbitrageactivities,may also have an effect on share prices. If the value of PSA ordinary shares relative to the value of FCA common shares increases or decreases (or the value of the Group’s business increases or decreasesrelative to the value of the FCA business)prior to the effectivenessof the merger, the market value of the combined company’scommonsharesthat shareholderswill hold followingthe merger may be higher or lower than the relative values of their shares on a standalone basis at the date of the combination agreement or the dateof this document. The merger is subject to receipt of antitrust approvals from several competition authorities and the expiration of the applicablewaiting period under the Hart Scott Rodino Act (the “HSR Act”). As a condition to obtaining the required antitrust approvals, the relevant regulatory authorities may impose conditionsthat could have an adverse effect on the combined

companyor, if suchapprovalsare not obtained,couldpreventthe consummationof the merger. Before the merger may be completed, any waiting period (or extensionthereof)applicableto the mergermust have expiredor been terminated, and any competition approvals, consents or clearancesrequiredin connectionwith the mergermust have been received,in eachcase,underthe applicableantitrustlawsof the EU, under the HSR Act, and under the competition laws of the Federative Republic of Brazil, the Republic of Chile, the United States of Mexico, the People’s Republic of China, Japan, the Republicof India,the Republicof SouthAfrica,People’sDemocratic Republic of Algeria, the Kingdom of Morocco, Israel, the Swiss Confederation,Ukraine, the Russian Federation, the Republic of Serbia, the Republic of Turkey, and, potentially, the Argentine Republic.The consummationof the mergermight be delayeddue to the time required to fulfill the requests for informationby the relevant regulatory authorities.The terms and conditions of any antitrust approvals, consents and clearances that are ultimately grantedmay imposeconditions,terms,obligationsor restrictionson the conductof the combined company’sbusiness. The Group and FCA are obligated under the combination agreementto take all actionsnecessaryto consummatethe merger as soon as reasonably practicable, including the relevant competitionapprovals and to undertake and comply with such commitments as the regulatory authorities may require as a conditionfor such competitionapprovals.As an exceptionto the foregoing, neither the Group nor FCA are required to nor may, withoutthe consentof the other party, undertakeor complywith any commitmentsor take any action(i) if any such commitmentor action,individuallyor in the aggregate,would,or wouldreasonably be expectedto, result in a substantialdetrimentto the combined company or (ii) unless any such commitment or action is conditioned upon the consummation f the merger.

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GROUPE PSA - 2019 UNIVERSAL REGISTRATION DOCUMENT