Result of Meeting

Telefonica SA
6 September 2001


'TELEFONICA, S.A.', on behalf of which and represented by Joaquin de Fuentes 
Bardaji, in his position as General Vice-Secretary and Vice-Secretary of the 
Board of Directors of the above-mentioned company, hereby presents the following
announcement:

In compliance with the terms and conditions of the quotation-linked options 
programme on TELEFONICA, S.A. ('TELEFONICA') shares for the employees of the 
Telefonica Group companies, entitled the 'TIES PROGRAMME', the Board of 
Directors of TELEFONICA resolved, at its meeting held today, September 5th, 
2001, to extend the Programme to include those company employees that form part 
of the companies that have joined the Telefonica Group after April 7th, 2000 
(the date set at the outset of the Programme) and prior to December 31st, 2000 
(hereinafter, 'New Beneficiaries').

The aforementioned 'TIES Programme' was approved by the Annual General 
Shareholders' Meeting of TELEFONICA held on April 7th, 2000 and the Board 
meetings of February 23rd and June 28th 2000, specifying, in their entirety, all
the terms and conditions of the Programme, among which the possibility to extend
this Programme was also included and set forth in the Abridged Prospectus 
registered with the Spanish Securities Commission on November 14th, 2000 and 
February 16th, 2001.

Due to the aforementioned extension of this Programme, the total number of New 
Beneficiaries is estimated to stand at 1,850 employees, which breaks down, in 
terms of companies and geographical positioning, into 51 in Spain, 1,507 in 
Argentina, 126 in Mexico, 65 in Brazil, 36 in the US, 36 in Venezuela and 29 in 
Italy.

In order to join the 'TIES Programme', the New Beneficiaries are entitled to 
acquire the TELEFONICA shares that form part of the Initial Allotment -the 
number of which varies in accordance with the individual's salary level, as was 
the case with the original Beneficiaries-at four euros and ninety cents (Euros 
4.90), which is equivalent to the price of five euros (Euros 5) paid by the 
initial Beneficiaries of the 'TIES Programme', once this had been adjusted to 
offset the dilution effect of the capital increase charged to freely disposable 
reserves carried out by Telefonica in March 2001, in the ratio of one new share 
for every 50 already held.

The shares from the Initial Allotment will total 30,781 should all the New 
Beneficiaries decide to join the Programme and these same shares will derive, as
foreseen, from those subscribed by Banco Bilbao Vizcaya Argentaria, S.A. and la 
Caja de Ahorros y Pensiones de Barcelona acting as the Agents for the 'TIES 
Programme' within the framework of the capital increase executed by TELEFONICA 
and set forth in the Abridged Prospectus registered with the Spanish National 
Securities Commission on February 16th, 2001, and therefore issuing the 
necessary share subscription contracts and purchase options signed on November 
14, 2000 by TELEFONICA and the two banking entities mentioned above.


The New Beneficiaries that acquire the shares corresponding to the Initial 
Allotment will receive, free-of-charge, the Variable Allotment (which was also 
previously received by the Beneficiaries of the 'TIES Programme') of 26 purchase
options on TELEFONICA shares for each share acquired, which may be exercised at 
the price of five euros (Euros 5), subject to the adjustments made to the terms 
and conditions of the 'TIES Programme'. The conditions, procedure and periods 
set forth for the New Beneficiaries of the 'TIES Programme' to exercise their 
corresponding options purchase rights, as well as the remaining rules applicable
to the participation of the New Beneficiaries, will be the same as those set at 
the moment of the launching of the 'TIES Programme' and set forth in the 
Abridged Prospectus registered and included in the official files of the Spanish
National Securities Commission on November 14th, 2000, and the Supplement to 
this Prospectus registered and included in the official files of the 
aforementioned Commission on January 9th, 2001.

Madrid, September 5th, 2001.

The information contained herein does not constitute an offer of securities for 
sale in the United States