General Meeting Documentation

Telefonica SA
02 April 2004

2004 ANNUAL GENERAL SHAREHOLDERS' MEETING OF 'TELEFONICA, S.A.'





 1. Calling and Agenda of the Annual General Shareholders' Meeting.


 2. Proposals to be submitted for the approval of the Annual General
    Shareholders' Meeting


  • Complete text of proposals of resolutions


  • Annex I: Regulations of the General Shareholders' Meeting of 'Telefonica,
    S.A.'

CALLING AND AGENDA



                              TELEFONICA, S.A.


                      Annual General Shareholders' Meeting






The Board of Directors of 'Telefonica, S.A.' (the Company) has resolved to CALL
the Annual General Shareholders' Meeting of the Company, to be held in Madrid on
April 29th, 2004 at 12:00 a.m. on first call at Recinto Ferial de la Casa de
Campo, Pabellon de Cristal, Avenida de Portugal, s/n(o)., and on April 30th,
2004 at 12:00 a.m. on second call in the same place, if necessary legal quorum
is not reached on first call.


The purpose of this call is to submit to the consideration and approval of the
Annual General Shareholders' Meeting, the items stated in the Agenda below.


                                     AGENDA


 I. Examination and approval, if applicable, of the Annual Accounts and
    Management Report of 'Telefonica, S.A.' and its Consolidated Group of
    Companies, as well as the proposal for the application of the results of
    'Telefonica, S.A.', and that of the management of the Company's Board of
    Directors, all for the 2003 financial year.


II. Shareholder remuneration, distribution of dividends from 2003 net income and
    from the Additional Paid- in capital reserve.


III. Designation of the Accounts Auditor for the 2004 fiscal year.


IV. Authorization for the acquisition of treasury stock, directly or through
    Group companies.


 V. Approval, if appropriate, of the Regulations of the General Meeting of
    Shareholders of 'Telefonica, S.A.'


VI. Delegation of powers to formalize, construe, correct and execute the
    resolutions adopted by the Annual General Shareholders' Meeting.



In addition, pursuant to the provisions of article 115 of the Spanish Stock
Market Act (Ley del Mercado de Valores), in accordance with the wording of this
article stipulated in Act 26/2003 of July 17th, 2003, the General Shareholders'
Meeting shall be informed of the Regulations of the Board of Directors of
'Telefonica, S.A.', as adapted to this Act.


The Board of Directors has also agreed to request the presence of a Public
Notary to draw up the minutes of the Meeting, in accordance with article 114 of
the Spanish Corporations Act (Ley de Sociedades Anonimas) in relation with
articles 101 and 103 of the Mercantile Registry's rules and regulations
(Reglamento del Registro Mercantil)


Lastly, shareholders are advised that based on experience in previous years, the
General Meeting may foreseeably be held on second call at 12 o'clock on April
30th, 2004 at the above-mentioned address.


Madrid, April 1st 2004



PROPOSALS TO BE SUBMITTED FOR THE APPROVAL OF THE ANNUAL GENERAL SHAREHOLDERS'
MEETING


Point I on the Agenda: Examination and approval, if applicable, of the Annual
Accounts and Management Report of Telefonica, S.A. and its Consolidated Group of
Companies, as well as the proposal for the application of the results of
Telefonica, S.A., and that of the management of the Company's Board of
Directors, all for the 2003 financial year.


A)     Approval of the Annual Accounts (Balance Sheet, Profit and Loss
Statement, and Notes to the Accounts) and Management Reports of Telefonica, S.A.
and its Consolidated Group of companies corresponding to 2003 financial year
(closed on December 31st of said year) as drawn up by the Board of Directors of
the Company at its meeting held of February 25th, 2004, as well as the Company
management performed by the Board of Directors of Telefonica, S.A. during said
financial year.


In the Individual Accounts, the Balance Sheet as of December 31st, 2003 reflects
assets and liabilities in the amount of 49,189.56 million Euros each, and the
Profit and Loss Statement, as of the end of the financial year, reflects a
positive result for an amount of 1,373.71 million Euros.


In the Consolidated Accounts, the Balance Sheet, as of December 31st, 2003,
reflects assets and liabilities for an amount of 62,075.20 million Euros each,
and the Profit and Loss Statement, as of the close of the financial year,
reflects a positive result in the amount of 2,203.58 million Euros.


 B. Approval of the following proposal for Application of the Results of
    Telefonica, S.A. for the financial year 2003:


Distribution of the net income obtained by Telefonica, S.A. in 2003, equalling
1,373,706,538.23 Euros, as follows:


  • 137,370,653.82 Euros (10 % of annual net income) to the legal reserve.

  • At the most, 991,178,272.20 Euros as a dividend distribution,
    corresponding to a fixed dividend of 0.20 Euros per share for all
    4,955,891,361 shares forming the Company capital stock.

  • The remainder of net income to the voluntary reserve, equalling at least
    245,157,612.21 Euros.


                Telefonica has submitted to the UK Listing Authority a copy of
                the following documents:


              • Account Auditor's Report, Annual Accounts and Management
                Report of 'Telefonica, S.A.', all for the 2003 financial year


              • Account Auditor's Report, Annual Accounts and Management
                Report of the Consolidated Group of Companies, all for the 2003
                financial year.


                These documents will shortly be available for inspection at the
                UK Listing Authority's Document Viewing Facility, which is
                situated at:


                                Financial Services Authority

                                25 The North Colonnade

                                Canary Wharf

                                London

                                E14 5 HS




Point II on the Agenda: Shareholder remuneration, distribution of dividends from
2003 net income and from the Additional Paid- in capital reserve.


 A. Approval of the payment of a cash dividend from 2003 net income of a gross
    amount of 0.20 Euros for each Company share issued, in circulation and
    carrying entitlement to this dividend.


    Payment shall be made on May 14th, 2004 through the participating entities
    in Iberclear (Sociedad de Gestion de los Sistemas de Registro, Compensacion
    y Liquidacion de Valores, S.A.), the Spanish securities registrar, clearing
    and settlement company.

    Tax shall be withheld on gross amounts payable in all circumstances as
    required by applicable legislation.

 B. Approval of distribution of the issue premium through the payment of a fixed
    gross sum of 0.20 Euros per share from the Additional Paid- in capital
    reserve for each Company share issued, in circulation and carrying
    entitlement to benefit from this distribution.


Payment shall be made on November 12th, 2004 through the participating entities
in Iberclear.

Tax shall be withheld on gross amounts payable in all circumstances as required
by applicable legislation.

Pursuant to the provisions of article 289.1 of the Spanish Corporations Act (Ley
de Sociedades Anonimas), it is hereby stated that the approval of debenture and
bondholder syndicates for the bonds and debentures in circulation is unnecessary
for the distribution of this payment, provided the decrease in reserves does not
diminish the initial proportional relationship between the sum of capital and
reserves and the debentures repayable.


Point III on the Agenda: Designation of the Accounts Auditor for the 2004
financial year.


To designate the company 'Deloitte & Touche Espana, S.L.' as Accounts Auditor
for the verification of the Annual Accounts, and the Management Reports of
'Telefonica, S.A.' and its Consolidated Group of Companies, corresponding to
financial year 2004.




Point IV on the Agenda: Authorization for the acquisition of treasury stock,
directly or through Group companies.


 A. To authorize, as set forth in Article 75 et seq of the current Spanish
    Corporations Act (Ley de Sociedades Anonimas), the acquisition, at any
    moment and as many times as considered necessary by 'Telefonica, S.A.' -
    either directly, or through any of the subsidiary companies of which it is
    the dominant company - of the Company's treasury stock, through a
    purchase-sale or by any other legal onerous title.


    The minimum acquisition price or compensation will be equivalent to the
    nominal value of the treasury stock acquired and the maximum acquisition
    price or compensation will be equal to the market value of the treasury
    stock on an official secondary market at the time of the acquisition.


    Said authorization is granted for a period of 18 months reckoned from the
    date of the holding of the current Annual General Shareholders' Meeting, and
    is expressly subject to the limitation that, at any time, the nominal value
    of the treasury stock acquired under this authorization, added to those
    already held by 'Telefonica, S.A.' and any of the controlled subsidiary
    companies, may exceed 5 percent of the share capital at the time of the
    acquisition, respecting the limitations set for the acquisition of treasury
    stock as imposed by the regulatory authorities of the markets on which
    Telefonica, S.A. shares are quoted.


    It is expressly noted that the authorization granted for the acquisition of
    treasury stock can be used wholly or partially for the acquisition of these
    shares of Telefonica, S.A., and that the Company must deliver or transfer to
    its directors or workers, or to those of the companies of its Group,
    directly or as a consequence of these having exercised their option rights,
    all within the framework of the referenced remuneration systems at the
    market value of the shares of the company approved in due form.


 B. To empower the Board of Directors, in the broadest possible terms, to
    exercise the authorization derived from this resolution and to execute the
    remaining items included in this, enabling the Board of Directors to
    delegate in the Executive Committee, the Executive Chairman of the Board or
    any other person expressly empowered by the Board to this effect.


 C. The unexecuted part of the resolution adopted by the Company's Annual General
    Shareholders' Meeting of April 11th, 2003, in relation with point IV of the
    Agenda of this same Meeting, shall remain null and void.




Point V on the Agenda: Approval, if appropriate, of the Regulations of the
General Meeting of Shareholders of Telefonica, S.A.


Approval of the proposed Regulations of the General Meeting of Shareholders of
Telefonica, S.A. submitted to this body by the Board of Directors of the
Company. A full, accurate copy of this text is included in annex.





                        SEE ANNEX I: Regulations of the General Meeting of
                        Shareholders of Telefonica, S.A.


Point VI on the Agenda: Delegation of powers to formalize, construe, correct and
execute the resolutions adopted by the Annual General Shareholders' Meeting.


To jointly empower the Executive Chairman, the Director-Secretary and Vice
Secretary non Director of the Board of Directors, so that any of them may
formalize and execute the preceding resolutions, and may grant the public and
private documents that are necessary or appropriate for such purpose (including
those for the interpretation, clarification, rectification of errors, and
correction of defects) for their most exact compliance and registration, when
mandatory, in the Mercantile Registry (Registro Mercantil) or any other public
registry.



    ANNEX I:


    REGULATIONS OF THE GENERAL SHAREHOLDERS' MEETING OF 'TELEFONICA, S.A.'





                                    PROPOSED


   REGULATIONS OF THE GENERAL SHAREHOLDERS' MEETING OF 'TELEFONICA, S.A.'


31st March 2004

                                    PREAMBLE




These Regulations of the General Shareholders' Meeting of 'Telefonica, S.A.'
aim, within the framework of the laws in force, to reinforce its transparency as
a listed stock company, as well as to gather and organise the different aspects
of calling, organisation and development of the General Shareholders' Meeting in
a single text, to provide the shareholder a framework to guarantee and
facilitate exercise of their rights in relation to the governing body of the
Company, with particular attention to the shareholders' right to information and
to participate in the deliberations and voting, ensuring the maximum diffusion
of the calling and proposals of resolutions that are submitted to the General
Shareholders' Meeting, all in order to ensure maximum transparency and
efficiency in forming the will and decision making by the Meeting.


Thus, 'Telefonica, S.A.' has implemented an essential component to the modern
structure of corporate governance of major listed companies, notwithstanding the
adaptations or reforms of those Regulations when eventual changes to the by-laws
require this, or experience of their application makes it advisable, and in any
case the ultimate decision on any amendment to the Regulations lies with the
actual General Shareholders' Meeting.



                                   I N D E X




TITLE I.     INTRODUCTION


      • Article 1.     Object and purpose

      • Article 2.     Currency, interpretation and modification

      • Article 3.     Publication and registration




TITLE II.     NATURE, COMPETENCE AND TYPES OF GENERAL MEETING


      • Article 4.     Nature of the General Meeting

      • Article 5.     Competence of the General Meeting

      • Article 6.     Types of General Meetings




TITLE III.     CALLING AND PREPARATION OF THE GENERAL MEETING


      • Article 7.     Power and obligation to call

      • Article 8.     Publication and announcement of the calling

      • Article 9.     Information available for shareholders from publication
        of announcement of the calling

      • Article 10.     Right to information

      • Article 11. Suggestions made by the shareholders




TITLE IV.     ORGANISATION AND CONSTITUTION OF THE GENERAL MEETING


      • Article 12.     Right to attend

      • Article 13.     Delegation and representation

      • Article 14.     Organisation of the General Meeting

      • Article 15.     Drawing up the Roll of Attendance

      • Article 16.     Constitution of the General Meeting

      • Article 17.     Board presiding the General Meeting. Chairman and
        Secretary of the General Meeting




TITLE V.     PROCEEDINGS OF THE GENERAL MEETING


      • Article 18.     Commencement of the meeting

      • Article 19.     Interventions

      • Article 20.     Powers of the Chairman to moderate and organise the
        General Meeting

      • Article 21.     Voting on the proposed resolutions

      • Article 22.     Passing resolutions and announcing the results

      • Article 23.     Conclusion of the General Meeting




TITLE VI.     EXTENSION AND SUSPENSION OF THE GENERAL MEETING


      • Article 24.     Extension

      • Article 25.     Suspension




TITLE VII.     MINUTES OF THE GENERAL MEETING AND ANNOUNCEMENT OF THE
RESOLUTIONS PASSED BY IT


      • Article 26.     Minutes of the General Meeting

      • Article 27.     Announcement of the resolutions


                                     * * *






                             TITLE I. INTRODUCTION




Article 1. Object and purpose.


The object of these Regulations is to establish the principles of organisation
and operation of the General Shareholders' Meeting of 'Telefonica, S.A.'
(hereinafter the Company), in order to enable the shareholders to exercise their
relevant rights, all pursuant to the terms of the Act and the Articles of
Association.




Article 2. Currency, interpretation and modification.


1. These Regulations shall be applicable to the General Meetings of Shareholders
of the Company that are called after its date of approval.


2. The Regulations will be interpreted according to the legal and statutory
regulations that are applicable and fundamentally according to their spirit and
purpose.


     3. The Board of Directors may propose that the General Shareholders'
Meeting amend these Regulations when, it its opinion, it is considered
convenient or necessary. The proposal for amendment must be accompanied by a
report to justify it.




Article 3. Publication and registration.


1. These Regulations, as well as their later amendments, shall be subject to
notification to the National Stock Exchange Committee and later registration at
the Business Registry of Madrid.


2. The current text of these Regulations will be available to the shareholders
at the Company registered office and on its web page (www.telefonica.es).






           TITLE II. NATURE, COMPETENCE AND TYPES OF GENERAL MEETING


Article 4. Nature of the General Meeting.


The General Shareholders' Meeting is the supreme deciding body of the Company,
through which it expresses the corporate will and articulates the right of the
shareholders to intervene in decision making by the Company, in the matters of
its competence.




Article 5. Competence of the General Meeting.


The General Shareholders' Meeting shall have the competence to deliberate and
pass resolutions on all the matters that the corporate regulations and Articles
of Association reserve for its decision and, in general, on all matters within
its legal scope of competence that are submitted to it, at the instance of the
Board of Directors and the actual shareholders, and in the manner foreseen by
law and in the Articles of Association.




Article 6. Types of General Meetings.


1. The General Shareholders' Meeting may be ordinary or extraordinary.


2. The Ordinary General Shareholders' Meeting, previously called to that end,
must meet within the first six months of each financial year to examine the
company management, to approve, if appropriate, the accounts of the previous
financial year and to resolve on application of the results. It may also pass
resolutions on any other matter within the remit of the General Shareholders'
Meeting, as long as this is on the agenda and the Meeting has been constituted
with the capital attendance required by the Act or the Company Articles of
Association.


3. All Meetings not foreseen in the preceding paragraph shall be considered
extraordinary.




           TITLE III. CALLING AND PREPARATION OF THE GENERAL MEETING


Article 7. Power and obligation to call.


1. The General Shareholders' Meeting must be formally called by the Board of
Directors of the Company, or by its Executive Committee, notwithstanding express
delegation to that end that those bodies may make in favour of any of its
members.


2. The Board of Directors, or the Executive Committee, may convene the General
Shareholders' Meeting whenever it considers convenient or appropriate to the
corporate interests and shall be obliged, in all cases, to call the Ordinary
General Shareholders' Meeting within the first six months of each financial
year, and to call the Extraordinary General Shareholders' Meeting whenever it is
requested in writing by shareholders who own at least five per cent of the share
capital, stating the matters to be discussed in their application. In that case,
the calling of the General Shareholders' Meeting shall be made for it to be held
within thirty days following the date on which notarial requirement to convene
is received, and the agenda must include at least the matters that were the
object of the application.




Article 8. Publication and announcement of the calling.


1. The General Shareholders' Meeting must be called by announcement in the
Official Journal of the Business Registry and in at least one of the major
newspapers published in the province where the Company registered office is
located, with the legally established minimum notice before the date set for it
to be held.


The calling of the General Meeting shall also be reported to the National Stock
Exchange Committee and the Governing Bodies of the relevant markets.


Likewise, calling of the General Meeting shall be announced on the Company web
page.


2. The announcements of calling must contain all the mentions required by the
Act according to the cases and, in any case, shall state the place, day and time
of the meeting at first calling and all the matters to be discussed at the
Meeting (agenda). It may also state the place, day and time for the second
session of the Meeting to convene, if appropriate.




Article 9. Information available for shareholders from publication of
announcement of the calling.


1. As of the date of publication of the announcement calling the General
Shareholders' Meeting, the Company shall provide the shareholders the documents
and information that must be provided to them by legal requirement or according
to the Articles of Association, in relation to the different points on the
agenda, and those documents and information shall be included on the Company web
page as of that date. Notwithstanding this, the shareholders may obtain the
documents and information, immediately and free of charge, at the Company
registered office, as well as requesting it to send or deliver them free of
charge, in the cases and on the terms legally established.


2. Likewise, as of the date of publication of the announcement calling the
General Shareholders' Meeting, and in order to facilitate attendance at the
General Meeting by shareholders, in addition to the documents and information
required by law, the Company shall place all matters the Company considers
convenient to the said ends on its web page, and for merely illustrative
purposes, the following:


     a. The text of all the proposals of resolutions that are to be submitted to
        the General Meeting and which have been approved at that time by the
        Board of Directors, notwithstanding them being amended by that body up
        to the date of the Meeting, when legally possible.


     b. Information on the place where the General Meeting is to be held,
        describing, when appropriate, the means of access to the hall.


     c. Procedure to obtain attendance cards or certificate issued by the
        entities legally authorised to do so.


     d. Means and procedures to grant representation at the General Meeting.


     e. If established, means and procedures to vote by mail.


     f. Any other aspects of interest to monitor the meeting, such as the
        existence, or not, of means of simultaneous translation, foreseeable
        conference call of the General Meeting or information in other
        languages.

This information may be subject to changes at any time, in which case the
relevant amendments or clarifications will be published on the Company web page.



3. The Company shall deliver the information and documentation referred to in
section 1 and paragraph a) of section 2 above of this article to the National
Stock Exchange Committee and other Governing Bodies of the appropriate Markets;
it shall also provide that information and documentation to the depositary
entity or entities of the programmes through which the Company is listed on
certain foreign Markets.




Article 10. Right to information.


1. From the moment when the announcement convening the General Shareholders'
Meeting is published, and until the seventh day before that foreseen to hold it
at first calling, any shareholder may apply in writing to the Board of Directors
to the Company for the information or clarifications he may consider necessary,
or pose the questions deemed appropriate in writing, on the matters included in
the Agenda of the Meeting published when its calling was announced, or
concerning the information available to the public that the Company has provided
the National Stock Exchange Committee since holding the immediately previous
General Shareholders' Meeting.


The Board of Directors shall be obliged to provide the information or
clarifications requested in writing, up to the day the General Meeting is held,
as well as to reply in writing to the questions raised. The replies to the
questions and requests for information submitted shall be sent through the
Secretary to the Board of Directors by any of its members, or by any person
expressly empowered by the Board of Directors for that purpose.


2. While the General Shareholders' Meeting is being held, the shareholders of
the Company may verbally request the information or clarification they consider
convenient concerning the matters included in the agenda and, if it is not
possible to satisfy the shareholder's right at that moment, the Directors shall
be obliged to provide that information in writing within seven days of
conclusion of the Meeting.


3. The Directors shall be obliged to provide the information requested under the
preceding two sections, except in cases in which, in the opinion of the
Chairman, publicity of the information requested may be damaging to corporate
interests.


Information shall not be refused when the application is backed by shareholders
representing at least one quarter of the share capital.




Article 11. Suggestions made by the shareholders.


     Notwithstanding the right of the shareholders, in the cases and on the
terms legally foreseen, for inclusion of certain matters on the Agenda of the
Meeting they have applied to have called, the shareholders may at all times and
following accreditation of their identity as such, through the Shareholder's
Office, make suggestions related to the organisation, operation and competences
of the General Meeting.




                   TITLE IV. ORGANISATION AND CONSTITUTION OF

                              THE GENERAL MEETING


Article 12. Right to attend.


1. The General Shareholders' Meeting may be held by shareholders who own at
least a number of shares requiring a minimum face value of 300 euros, as long as
these are registered in their name on the relevant register of annotations to
account five days prior to the date on which it is held, and they accredit by
means of the relevant attendance card or nominative certificate issued by any of
the entities participating in the body that manages that accounting register, or
directly by the Company itself, or in any other manner admitted under current
law. That card or certificate may be used by the shareholders as a document to
grant representation for the Meeting concerned.


2. Shareholders who are not holders of the minimum number of shares required to
attend may at all times delegate their representation, as indicated in the
following article, upon a shareholder who is entitled to attend the Meeting, as
well as form groups with other shareholders in the same situation, till they
gather the necessary shares, and representation must be granted to one of them.
The grouping must be carried out specifically for each Meeting and be recorded
by any written means.


3. The Chairman may authorise attendance by any person deemed appropriate,
although the Meeting may revoke that authorisation.


Article 13. Delegation and representation.


     1. All shareholders who are entitled to attend the General Shareholders'
Meeting May be represented at it by another person, even if not a shareholder.
The representation must be granted specifically for each Meeting, either using
the delegation formula printed on the attendance card, or in any other legally
permitted way, except for what is set forth in article 108 of the Stock Company
Act for cases of family representation and granting of general powers.


     The documents recording delegation or representation at the General
Shareholders' Meeting shall state the instructions concerning the sense of the
vote, it being understood that, if no specific instructions are given, the
representative will vote in favour of the resolution proposals put forward by
the Board of Directors on the matters on the agenda.


     If there are no voting instructions because the General Shareholders'
Meeting is to resolve on matters that are not on the agenda and thus unknown on
the date of the delegation, that may be submitted to ballot at the Meeting, the
representative must cast the vote in the sense he deems most appropriate,
according to the interest of the Company and party represented. The same shall
apply when the relevant proposal or proposals submitted for decision by the
Meeting are not formulated by the Board of Directors.


     If the document of representation or delegation does not state the specific
person or persons the shareholder grants representation to, it shall be
understood to be granted in favour of the Chairman of the Board of Directors of
the Company, or whoever may stand in for him to chair the General Meeting, or,
indistinctly, in favour of the person appointed by the Board of Directors and
notified in advance in the official announcement of the calling.


In cases in which a public request for representation is formulated, the
Director who obtains it shall have the voting restriction applied to him that is
established in article 114 of the Stock Market Act for cases of conflicts of
interest.


     The representation may always be revoked. Personal attendance at the
General Meeting by the party represented shall be considered revocation.


     2. Individual shareholders who do not have full capacity to act and
corporate shareholders shall be represented by those who, by law, exercise their
representation, duly accredited.


3. In any event, in cases of voluntary representation as well as those of legal
representation, no more than one representative may be had at the Meeting.


     4. The Chairman of the General Shareholders' Meeting, or by his delegation,
the Secretary to same, shall resolve all doubts arising concerning the validity
and effectiveness of the documents accrediting the right of any shareholder to
attend the General Shareholders' Meeting individually or by grouping shares with
other shareholders, as well as delegation or representation in favour of another
person, ensuring that only documents that fail to meet the minimum essential
requisites are considered invalid or ineffective, as long as those defects have
not been corrected.




Article 14. Organisation of the General Meeting.


     1. The General Shareholders' Meeting shall meet at the place stated in the
calling, within the area where the Company has its registered office, on the day
and at the time also stated in the calling.


     2. In order to ensure correct exercise of the right to attend the General
Shareholders' Meeting, as well as to guarantee the safety of those attending and
due proceedings of the General Meeting, the access control system and
surveillance and protection systems the Board of Directors considers adequate
shall be established.


     3. The sessions of the General Shareholders' Meeting may be held in one
hall or several adjoining halls, or ones that are not adjoining, but located
within the same building complex or compound, as long as the Board of Directors
considers there are justified reasons for this. In such case, the audiovisual
means shall be provided to allow interactivity and intercommunication between
the halls in real time.


     4. In order to encourage the widest diffusion of the proceedings of the
General Shareholders' Meeting and the resolutions passed by it, access to the
place where the Meeting is held may be provided for representatives of the
media, as well as financial analysts and other duly accredited experts. To that
same end, the Chairman of the Meeting may allow total or partial broadcasting or
audiovisual recording of the General Meeting.


     5. On entry to the premises where the General Shareholders' Meeting is
held, the attendees shall be provided the full text of the proposed resolutions
to be submitted for approval by the General Meeting, with the exception, as
appropriate, of proposals that have been put forward immediately prior to the
Meeting being held, that it has not been possible to deliver. The shareholders
shall be informed of the latter during the Meeting and, in all cases, before the
shareholders' turn to speak.




     6. No photographic, video, recording or similar devices may be used in the
hall or halls where the General Shareholders' Meeting is held, except to the
extent allowed by the Chairman. Control mechanisms shall be set up at the place
of access to the hall or halls to ensure fulfilment of that provision.






Article 15. Drawing up the Roll of Attendance.


     1. In order to proceed to prepare the Roll of Attendance, admission of the
delegations shall take place enough time in advance on the day set in the
calling to hold the General Shareholders' Meeting, so the shareholders, or those
who validly represent them, may deliver or send their respective delegations to
the registered office of the Company and, if appropriate, the documents that
accredit their representation, all notwithstanding the relevant control at the
place and on the date foreseen to hold the General Meeting.


     2. Likewise, at the place and on the date foreseen to hold the General
Shareholders' Meeting, from the moment when the access doors are opened to the
place where the Meeting is held, the shareholders attending the Meeting
personally, or those validly representing them at it, must deliver their
respective attendance cards and delegations to the staff in charge of
registering shareholders, exhibiting the documents to accredit their identity
and, if appropriate, representation and groups of shares.


     3. The register of shareholders present and represented at the General
Shareholders' Meeting may be taken by manual methods, or using optic reader
systems or other technical means considered adequate.


     4. In order that the General Shareholders' Meeting may begin at the time
foreseen in the calling, the attendance card and delegation registration process
shall end minutes before the time foreseen to begin the General Shareholders'
Meeting; and, once that process has concluded and the existence of sufficient
quorum to validly constitute the Meeting at first or second calling, as
appropriate, has been verified, the Board presiding the General Meeting shall be
formed and it may commence.


     5. Once the General Shareholders' Meeting is validly constituted, and in
order to complete recording of the Roll of Attendance, the attendance cards or
delegations presented after constitution of the Board presiding and commencement
of the session must be admitted, as long as these are presented before the
shareholders' turn to speak begins.


     The shareholders duly accredited, or their representatives, who have not
presented their attendance cards before the turn to speak begins, may attend the
meeting, but will not be included on the Roll of Attendance and will thus not be
considered to have attended the Meeting.




     6. Preparation of the Roll of Attendance and resolution of matters arising
in relation to it is the remit of the Secretary to the Board, who shall exercise
that competence by delegation by the Board presiding the Meeting, which may
appoint two or more teller shareholders to aid the Secretary to draw up the Roll
of Attendance.




     At the end of the Roll of Attendance, the number of shareholders present or
represented shall be determined, as well as the amount of capital they hold,
specifying that of shareholders with voting rights.


     7. The Roll of Attendance shall be included on magnetic media, that shall
be kept in an envelope or sealed container, the cover of which shall bear the
relevant identification proceedings signed by the Secretary to the General
Shareholders' Meeting with the approval of the Chairman of same. The Minutes of
the Meeting shall record the inclusion of the Roll of Attendance on computer
media.




Article 16. Constitution of the General Meeting.


1. The ordinary or extraordinary General Shareholders' Meeting shall be
constituted at first or second calling. The legal and statutory quorums to
constitute the Meeting shall be required.


     If, by the terms of the law or Articles of Association, a minimum
percentage of the share capital is required for valid constitution of the
ordinary or extraordinary General Shareholders' Meeting, or to validly pass
certain resolutions, and that attendance is not achieved at the second calling
according to the Roll of Attendance, the agenda of the General Shareholders'
Meeting shall be limited to the rest of the points on same that do not require
that specific minimum attendance of capital for valid constitution of the
Meeting or to pass resolutions.


2. Absence of shareholders once the General Shareholders' Meeting is constituted
shall not affect the validity of its constitution.


     3. The members of the Board of Directors must attend the General
Shareholders' Meeting, but should they fail to attend, this shall not affect the
valid constitution of the Meeting.




Article 17. Board presiding the General Meeting. Chairman and Secretary of the
General Meeting.


     1. The Board presiding the General Shareholders' Meeting shall be formed by
the Chairman and Secretary to the General Meeting, and by the members of the
Board of Directors attending the meeting.





 2. The General Shareholders' Meeting shall be chaired by the Chairman of the
    Board of Directors and, in his absence, by a Vice-Chairman of the same
    Board, in the relevant order if there are various, being replaced, in the
    event of vacancy, absence or illness, by the most senior Director appointed
    and, in the event of equal seniority, by the elder one. The acting Secretary
    shall be the Secretary to the Board of Directors and, failing that, a
    Vice-Secretary, in the relevant if there are various, being replaced, in the
    event of vacancy, absence or illness, by the least senior Director appointed
    and, in the event of equal seniority, by the youngest one.


If, once the General Shareholders' Meeting has commenced, the Chairman or
Secretary of same has to leave it for any reason, his duties shall be undertaken
by the relevant persons according to what is set forth in the preceding
paragraph and the session of the Meeting shall continue.


3. When any circumstance arises due to which the Chairman of the Meeting
considers it advisable, even while present at the meeting, he may temporarily
entrust moderation of the debate to any member of the Board of Directors he
considers fit, or the Secretary to the Meeting, who shall stand in for the
Chairman.


4. The Chairman may have any expert he considers appropriate attend the Meeting
to assist him.






                  TITLE V. PROCEEDINGS OF THE GENERAL MEETING




Article 18. Commencement of the meeting.


     After having verified the existence of sufficient quorum for valid
constitution of the Meeting, and once the Board presiding the General
Shareholders' Meeting is formed, its proceedings shall commence. The Chairman,
or by his delegation, the secretary, shall publicise the provisional data
concerning the number of shareholders with voting rights present or represented
in attendance at the meeting at that moment, the number of shares for one and
the other and the percentage of capital they represent.


     Then, considering that data, the Chairman shall declare the General
Shareholders' Meeting validly constituted, at first or second calling, as
appropriate, and then, if the presence of a Notary Public has been required, he
shall take the floor to ask the attendees whether they have any reservations or
complaints concerning the data stated and the valid constitution of the Meeting,
so it may be duly recorded in the Minutes of same.


     If the presence of a Notary Public has not been required, the references to
him in this article shall be understood to refer to the Secretary to the General
Shareholders' Meeting.




Article 19. Interventions.


     1. Once the session has commenced, the Chairman shall invite the
shareholders who wish to speak at the General Shareholders' Meeting to request
information, or to deliver any other statement in relation to the points on the
agenda, to make this known, after indicating, by means of their attendance card
or relevant certificate, their identifying particulars and the number of shares
they own or, if appropriate, represent.


          2. Once the Board presiding the Meeting has the list of shareholders
who wish to speak, and after the presentation by the Chairman of the Meeting, or
the persons he may appoint for that purpose, of the relevant reports and, in any
case, before voting on the matters included on the agenda, the Chairman shall
grant the floor for the shareholders to speak. The shareholders will speak in
the order in which they are called by the Board presiding.


     Those speaking who so wish, may request that the full written text of their
intervention be included in the Minutes of the Meeting, to which end they must
deliver it to the Notary Public taking the minutes of the meeting at that time,
or failing that, the Secretary or personnel aiding one or the other.


     3. It is the remit of the Chairman, on the terms established by the Act, to
provide the information or clarifications requested, although, when he sees fit
due to the matter these concern, he may entrust this to the Chairman of any of
the Committees of the Board, a member of the Board presiding, or any director,
employee, expert or advisor to the Company. The Chairman may determine, in each
case, according to the information or clarifications requested, whether the
answer will be given individually or in groups by subjects, and what is set
forth in article 10 of these Regulations must be taken into account.




Article 20. Powers of the Chairman to moderate and organise the General Meeting.


     1. The Chairman of the General Shareholders' Meeting has the power to
moderate and organise the proceedings of the Meeting, and must direct and
maintain the debate within the limits of the agenda and conclude these when he
considers each matter has been sufficiently discussed.


     2. When performing his duties of moderation and organisation of the General
Shareholders' Meeting, the Chairman, assisted by the Secretary, shall have the
following powers, among others:


 a. To organise performance of interventions by shareholders on the terms
    foreseen in these Regulations.


 b. To grant the floor to the shareholders who so request, when deemed
    appropriate, being able to withdraw it when a specific matter is considered
    to have been sufficiently debated, or when the proceedings of the meeting
    are hindered, or when the matter is not included on the agenda.


 c. To resolve, when considered necessary, extension of the time initially
    available to the shareholders to speak, or when the high number of
    interventions requested, or any other circumstance, makes it advisable, to
    set the maximum length of each intervention, or to limit the time for
    shareholders to speak when the matter is considered to have been
    sufficiently debated, respecting the principle of equal treatment of
    intervening shareholders in all cases.


 d. To moderate interventions by the shareholders, being able to require them to
    clarify matters that have not been sufficiently explained, or that are
    according to the agenda and within the appropriate rules of politeness when
    speaking, calling shareholders to order when their interventions are
    manifestly obstructionist or aimed at hindering the normal proceedings of
    the Meeting, and being able to take the appropriate measures to guarantee
    the normal proceedings of the Meeting continue.


 e. To announce the result of the voting personally, or through the Secretary.


 f. To resolve matters that may arise during the proceedings of the General
    Shareholders' Meeting concerning interpretation and application of the rules
    established in these Regulations.


 g. In general, to exercise the powers, even of order and discipline, that are
    convenient for appropriate proceedings of the meeting.




Article 21. Voting on the proposed resolutions.


     1. On conclusion, when appropriate, of the interventions by shareholders,
and when the answers are provided as foreseen in these Regulations, voting on
the relevant proposals of resolutions shall take place.


     The voting process on each one of the proposed resolutions shall take place
following the agenda foreseen in the calling and, if proposals are made on
matters on which the Meeting may resolve without them being included on the
agenda, these shall be submitted to voting after the relevant proposals on the
agenda called, except if the Chairman decides otherwise.


     2. Following complete or summarised reading by the Secretary, that may be
waived when the text of the relevant proposal for resolution on the point of the
agenda concern has been distributed among the shareholders at the beginning of
the General Shareholders' Meeting, voting shall proceed firstly on the proposals
of resolutions made in each case by the Board of Directors, and then, if
appropriate, voting on those made by other proposers, following the order set
for that purpose by the Chairman.


     In all cases, when a proposal of resolution is approved, all others on the
same matter that are incompatible with it shall automatically be withdrawn and
thus not be submitted to voting, which shall be stated by the Chairman of the
Meeting, or by the Secretary on delegation by the former.


     3. The following telling system will be used to vote on the proposals of
resolutions:


 a. In the case of voting on proposals of resolutions related to matters on the
    agenda, all shares attending the meeting, present or represented, according
    to the Roll of Attendance shall be considered votes in favour of the
    proposal submitted for voting, minus the votes of shares whose holders or
    representatives inform the tellers and other assistants of the Board
    presiding, or Notary Public if appropriate, by written communication or
    personal statement, of their vote against, in blank or their abstention.


 b. In the case of voting on proposals of resolutions concerning matters not
    included on the agenda, all shares attending the meeting, present or
    represented, according to the Roll of Attendance shall be considered votes
    against the proposal submitted for voting, minus the votes of shares whose
    holders or representatives inform the tellers and other assistants of the
    Board presiding, or Notary Public if appropriate, by written communication
    or personal statement, of their vote for, in blank or their abstention.


 b. For the purposes provided in paragraphs a) and b) above, for each one of the
    resolutions submitted for voting, the shares considered concurrent, present
    and represented at the meeting shall be all those recorded on the Roll of
    Attendance, minus the shares that, according to the laws in force, and
    according to the proposal for resolution submitted to voting, may not
    exercise the relevant voting right.


     Whatever the system used to calculate the votes, checking by the Board
presiding the Meeting or, exceptionally, in the case of that Board not having
been formed, by the Secretary to the Meeting, of the existence of a sufficient
number of votes in favour to attain the majority required in each case, will
allow the Chairman to declare the relevant proposal of resolution to be
approved.


          4. According to the provisions of the Articles of Association,
shareholders may delegate or exercise their right to vote on the relevant
proposals of the agenda items by postal correspondence, electronic mail, or any
other means of remote communication, as long as in such cases the Company has
established accredited procedures to duly guarantee the identity of the
individual exercising the right to vote and unequivocally record the identity
and status (shareholder or representative) of the voters, of the number of
shares which with he is voting and sense of the vote, or if appropriate,
abstention.


     The procedure or procedures that the Company may establish to such ends
shall determine the requisites, terms and conditions to exercise delegation or
the right to vote, and must be published in the announcement calling the General
Meeting and on the Company web page.




Article 22. Passing resolutions and announcing the results.


     1. The resolutions shall be passed by majority, that is, the proposals of
resolutions shall be approved when the number of votes in favour of each
proposal is greater than the number of votes against it (whatever the number of
blank votes and abstentions), notwithstanding the increased voting quorums
established in the Act and Articles of Association, and one must also take into
account the limitation of the maximum number of votes that may be cast by each
shareholder, as foreseen in article 21.2 of the Articles of Association.


          2. When voting has taken place on the proposals on the terms foreseen
in these Regulations, the Chairman personally, or through the Secretary, shall
proclaim the results, stating whether each one has been approved or rejected.




Article 23. Conclusion of the Meeting.


     Following voting on the proposals of resolutions and announcement of their
approval or rejection, the General Shareholders' Meeting shall be concluded and
the Chairman shall end the meeting.






           TITLE VI. EXTENSION AND SUSPENSION OF THE GENERAL MEETING








Article 24. Extension.


     At the proposal of the Chairman of the General Shareholders' Meeting, or at
the request of shareholders representing at least one quarter of the share
capital present or represented at the meeting, the General Shareholders' Meeting
may agree to extend the session for one or more consecutive days. If the place
where the successive sessions must be other than that of the first day due to
organisational reasons, that venue shall be notified, if possible, when the
extension is agreed; if not, it shall be notified as soon as determined, in an
adequate means of information that shall be set in the resolution on extension.


     Whatever the number of its sessions, the Meeting shall be considered a sole
event, and sole Minutes shall be taken for all the sessions. Thus, in the
successive sessions, it will not be necessary to reiterate fulfilment of the
requisites foreseen in the Act, in the Articles of Association, or in these
Regulations for its valid constitution.


     Only shareholders included on the Roll of Attendance will be entitled to
attend and vote at the successive sessions held due to extension of the General
Shareholders' Meeting. The shares held by the shareholders included on that Roll
of Attendance who leave, if appropriate, the subsequent sessions, shall not be
deducted and shall continue to be telled for the purposes of calculating the
majority required to pass resolutions. However, any shareholder who intends to
leave the latter sessions may, if he considers it convenient, inform the tellers
and other assistants to the Board presiding, or the Notary Public, if
appropriate, of that intention and the sense of his vote on the proposals that
are recorded on the agenda.




Article 25. Suspension.


     1. Exceptionally, if situations arise that substantially affect the proper
order of the meeting, or that temporarily prevent its normal proceedings, the
Chairman, having consulted the Board presiding the General Meeting, may agree to
suspend the session for the time required to re-establish the necessary
conditions for it to continue.


     In that case, the Chairman, also having consulted the Board presiding, may
adopt the measures deemed appropriate to avoid repetition of circumstances that
could again alter the proper order and proceedings of the meeting.


     2. If, once the session reconvenes, the circumstances that gave rise to
temporary suspension persist, the Chairman, having consulted the Board
presiding, may propose that the attendees extend the General Shareholders'
Meeting to the following day, as foreseen in the preceding article.


     If the extension is not agreed, or it is not possible to agree for any
reason, the Chairman of the Meeting, after consulting the Board presiding, may
decide to definitively suspend the Meeting, or to continue it, proceeding
directly to submit the proposals of resolutions on the agenda made by the Board
of Directors or shareholders up to that moment for approval, as long as the
following requisites are fulfilled:





 a. That any shareholder may have exercised his right to information since
    calling of the Meeting and the company has provided the relevant information
    and documentation according to the applicable legal and statutory
    provisions.


 b. That approval of all or some of the proposals on matters on the agenda is of
    notorious importance to the corporate interest, or that substantial damage
    may arise due to definitive suspension of the Meeting.


 c. That one may reasonably presume that the situation that had caused suspension
    of the Meeting would repeat itself on the meeting being reconvened.


     When, according to the terms foreseen in this section, they proceed
directly to voting on the proposals of resolutions, the shareholders present may
apply to the Board presiding, or Notary Public if appropriate, or to the
Directors in writing, for all information they may consider convenient
concerning the matters on the agenda of the Meeting, and the Directors must
attend to those requests in writing within seven days of that on which the
Meeting ends, notwithstanding the limitations foreseen in article 10.3 of these
Regulations.






 TITLE VII. MINUTES OF THE GENERAL MEETNIG AND ANNOUNCEMENT OF THE RESOLUTIONS
                                  PASSED BY IT




Article 26. Minutes of the Meeting.


          1. The deliberations and resolutions by the General Shareholders'
Meeting shall be recorded in the Minutes, that shall record at least all the
particulars required by the applicable legal and statutory provisions.


     2. The Minutes of the General Meeting may be drafted by its Secretary,
being approved by the actual Meeting after it is held and, failing that, within
the term of fifteen days, by the Chairman of the Meeting and two Interveners,
one on behalf of the majority and the other for the minority, appointed by the
Meeting as proposed by its Chairman. The Minutes approved in either of the two
ways shall be executive as of the date of its approval. Once the Minutes are
approved, they shall be signed by the Secretary to the Meeting with the approval
of the Chairman and transcribed in the Minutes Book.


     3. The Directors may require the presence of a Notary Public of their
choice to take the Minutes of the Meeting, and they shall be obliged to do so in
the cases when the applicable by-laws so require.


     The Notarial Certificate shall be considered the Minutes of the Meeting and
does not require its approval.




Article 27. Announcement of the resolutions.


     1. Notwithstanding the means of publicity that may be legally required in
each case, the shareholders may view the resolutions passed by the General
Shareholders' Meeting on the Company web page, on which their full text shall be
published as soon as possible after the Meeting ends.


     2. Resolutions due registration shall be presented for registration at the
Business Registry and will be published according to the applicable provisions.


     3. The Company shall report the resolutions passed by the General
Shareholders' Meeting to the National Stock Exchange Committee and the Governing
Bodies of the relevant Markets, either literally, or by means of a summary of
their content, as soon as possible after the Meeting ends.


                                     * * *



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