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INFORMATION FOR SHAREHOLDERS FOR

THE 2016 ANNUAL SHAREHOLDERS MEETING

May, 2016

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Information for Shareholders for the 2016

Annual Shareholders’ Meeting of Indra

This document was prepared by the Board of Directors of Indra Sistemas, S.A. (the

“Company” or “Indra”) in order to present to its Shareholders, fully and in detail, the

Agenda and the reasons for each Agenda Item for the next Annual Shareholders

Meeting (the “Meeting”), as well as the proposed resolutions that the Board of

Directors (the “Board”) has decided to submit to the Meeting for each Item of the

Agenda.

Just as in previous years, pursuant to its policy of following best practices in

corporate governance and transparency of information, and in accordance with the

Ley de Sociedades de Capital (“Corporations Act” or “LSC”), from the very start of

the Meeting the Board of Directors makes information available to Shareholders

explaining the contents of each one of the proposals that the Board will submit,

with the goal of facilitating Shareholder understanding of said proposals and

allowing Shareholders to submit their votes with a deeper understanding of the

issues.

In Item 1 of the Agenda, approval of the Financial Statements and of the

Management Report of Indra Sistemas, S.A. and its consolidated group are

proposed (and which form part of the Annual Corporate Governance Report for

fiscal 2015 in accordance with Article 538 of the LSC).

Item 2 of the Agenda is a proposal for allocation of losses realized during the fiscal

year ended 31 December, 2015.

In Item 3 of the Agenda, approval of the Board´s management for the fiscal year

ended 31 December, 2015 is proposed.

Regarding the three Agenda items above, the audited individual and consolidated

Annual Financial Statements and Management Report, the Report on Corporate

Governance, and the Annual Corporate Social Responsibility Report for fiscal 2015

are made available on the Company website upon call of the Meeting, along with

other relevant information.

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Item 4 of the Agenda includes a proposal for approval of a Segregation between

Indra Sistemas, S.A. as Segregated Company and Indra Corporate Services, S.L.U. as

Beneficiary Company in accordance with the Segregation Project approved by the

respective administrative bodies. All information relating to the transaction as

required by law is provided.

Item 5 of the Agenda includes a proposal for appointment of auditors for review of

the individual and consolidated annual financial reports for fiscal 2016, 2017 and

2018. Shareholders have available to them the Report on the Independence of the

External Auditor of the financial statements for fiscal 2015 drafted by the Audit

and Compliance Committee pursuant to the provisions of Article 529.14 of the LSC,

and which the Company has made public in conformance with recommendation 6

of the new Code of Good Corporate Governance for Listed Companies.

In Item 6 of the Agenda, the re-election of four Directors whose terms end this

year is proposed, accompanied by substantial supporting documentation for these

proposals. The proposal from the Nomination, Compensation and Corporate

Governance Committee and the supporting report from the Board regarding the re-

election of Independent Directors and outlining the competence, experience and

merits of the proposed candidates are placed at the disposal of Shareholders.

Additionally, the professional profile of each of the above referenced Directors is

included.

Items 7 and 8 of the Agenda propose, as is usual for listed companies, the renewal

of authority enabling the board of Directors to increase company capital and issue

instruments convertible or not for shares in the Company as well as other

instruments with subscription rights. In accordance with the provisions of the LSC,

the Board has issued the corresponding reports supporting said proposals.

Item 9 of the Agenda proposes approval of the amendment of the Bylaws with the

primary goal of harmonizing them with changes made to Article 529.14 of the LSC

and with the provisions of Disposición Final Cuarta, paragraph 20, of the Ley

22/2015 regarding Auditing of Financial Statements. Also, some language was

modified in order to make it more consistent with changes made to the

recommendations contained in the Code of Good Corporate Governance for Listed

Companies. In accordance with the provisions of Article 286 of the LSC, the Board,

as author of said proposal to modify the Bylaws, has drafted a corresponding

report supporting same, which is made available to Shareholders.

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In Item 10 of the Agenda, in accordance with the provisions of Article 541 of the

LSC, the Board submits, on a consultative basis, the 2015 Annual Report on

Director Compensation.

Item 12 of the Agenda reports to the Meeting regarding amendments approved by

the Board of Directors and introduced into the Board Rules since the last Meeting.

In addition to the documentation referred to, Shareholders may review the 2015

Annual Reports on the Proceedings of the Audit and Compliance Committee and of

the Nomination, Compensation and Corporate Governance Committee as well as

the Report Regarding Related Party Transactions issued by the Nomination,

Compensation and Corporate Governance Committee on the Company website,

which documents the Company makes public in accordance with best practices

regarding corporate governance.

All of the aforementioned information as well as the documents mentioned in the

call announcement and the call notice itself will remain accessible without

interruption on the Indra website (www.indracompany.com) from publication of the

call.

The Board of Directors,

26 May 2016

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a. Call to Order

b. Items 1, 2 and 3 of the Agenda. – Approval of the Individual and Consolidated

Financial Statements and the Management Report for the 2015 fiscal year. Approval

of the proposed allocation of losses for 2015. Approval of the Board of Directors’

management of the Company for the fiscal year ended 31 December, 2015.

c. Item 4 of the Agenda. – Approval of the Intercorporate Transfer from Indra

Sistemas, S.A. to its wholly owned subsidiary Indra Corporate Services, S.L.U.

d. Item 5 of the Agenda. – Appointment of auditors for the individual and consolidated

Annual Financial Statements and Management Reports for fiscal 2016, 2017 and

2018.

e. Item 6 of the Agenda. –Appointment and re-election of Directors.

f. Item 7 of the Agenda. – Delegation to the Board of Directors, with express power to

sub-delegate, the authority to increase the capital stock of the Company consistent

with the conditions contained in Article 297.1 b) of the LSC, including by means of

the issuance of redeemable shares, and the authority to exclude pre-emptive rights,

in which case any increase of capital pursuant to this delegation may not exceed

20% of the capital stock of the Company at the time of authorization at the Annual

Shareholders’ Meeting, it being understood that said limitation includes the amount

of any increase in capital which may arise from the approval and execution of the

proposal contained in Item 8 of the Agenda.

g. Item 8 of the Agenda. – Delegation to the Board of Directors, with express power to

sub-delegate, the authority to issue in one or more offerings, obligations, bonds

whether convertible or exchangeable or not, as well as other fixed income

instruments, warrants, and any other instruments conceding the right to acquire new

share issuances, outstanding shares of the Company or of other companies, with a

limit of 1.500 M€. This authorization includes the delegation of powers necessary,

when appropriate, to: (i) determine the bases and means of conversion, exchange or

exercise; (ii) increase capital stock in the amount necessary to carry out conversion

requests; and (iii) exclude pre-emptive rights for said issuances, limited to a maximum

of 20% of the nominal value of capital stock.

h. Item 9 of the Agenda. – Approval of the amendment of the Bylaws.

i. Item 10 of the Agenda. – Consultative vote on the Annual Compensation Report for

2015.

j. Item 11 of the Agenda. –Authorization and delegation of powers for the

formalization, registry, and execution of resolutions adopted at the Meeting.

k. Item 12 of the Agenda. – Information regarding amendment of the Board Rules.

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a. a. Announcement of call of the Meeting

Annual Shareholders Meeting

By resolution of the Board of Directors, Shareholders are called to the Annual Shareholders

Meeting of Indra Sistemas, S.A. to be held at the corporate offices located at Alcobendas

(Madrid), Avenida de Bruselas 35, this upcoming June 29th, 2016 at first call at 12:30 p.m. or,

in the event a quorum is not present the next day, June 30th, 2016 at the same time and place

on second call in order to consider and decide the following matters:

AGENDA

First. - Review and approval of the Financial Statements and the Management Report of Indra

Sistemas, S.A. and its Consolidated Group for the fiscal year ended 31 December 2015.

Second. - Approval of the proposed allocation of losses for fiscal 2015.

Third. - Approval of management by the Board of Directors during the fiscal year ended on 31

December 2015.

Fourth.- Approval of the Segregation between Indra Sistemas, S.A. (as Segregated Company)

and Indra Corporate Services, S.L.U. (Beneficiary Company) in accordance with the Segregation

Project approved by each company’s administrative bodies.

Fifth. - Appointment of auditors for the individual and consolidated Financial Statements and

Management Reports for fiscal 2016, 2017, and 2018.

Sixth. - Re-election of Directors

6.1. Re-election of Mr. Luis Lada Díaz as Independent Director, upon proposal by the

Nomination, Compensation and Corporate Governance Committee.

6.2. Re-election of Mr. Alberto Terol Esteban as Independent Director, upon proposal by the

Nomination, Compensation and Corporate Governance Committee.

6.3. Re-election of Mr. Juan March as Proprietary Director representing the equity interest of

Corporación Financiera Alba, S.A., upon proposal by the Board of Directors.

6.4. Re-election of Mr. Santos Martínez-Conde Gutiérrez-Barquín as Proprietary Director

representing the equity interest of Corporación Financiera Alba, S.A., upon proposal by the

Board of Directors.

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Seventh. - Delegation to the Board of Directors, with express power to sub-delegate, the

authority to increase the capital stock of the Company consistent with the conditions contained

in Article 297.1 b) of the LSC, including by means of the issuance of redeemable shares, and the

authority to exclude pre-emptive rights, in which case any increase of capital pursuant to this

delegation may not exceed 20% of the capital stock of the Company at the time of

authorization at the Annual Shareholders’ Meeting, it being understood that said limitation

includes the amount of any increase in capital which may arise from the approval and execution

of the proposal contained in Item 8 of the Agenda.

Eighth. - Delegation to the Board of Directors, with express power to sub-delegate, the

authority to issue in one or more offerings, bonds or debentures, simple, convertible,

exchangeable into or for shares of the Company, as well as other fixed income instruments,

warrants, and any other instruments conceding the right to acquire new share issuances,

outstanding shares of the Company or of other companies, with a limit of 1,500 M€. This

authorization includes the delegation of powers necessary, when appropriate, to: (i) determine

the bases and means of conversion, exchange or exercise; (ii) increase capital stock in the

amount necessary to carry out conversion requests; and (iii) exclude pre-emptive rights for said

issuances, limited to a maximum of 20% of the nominal value of capital stock.

Ninth. - Approval of modification of Articles 31 and 31 bis of the Bylaws.

9.1. Approval of the modification of Article 31 of the Bylaws regarding the Audit Committee.

9.2. Approval of the modification of Article 31 bis of the Bylaws regarding the Nomination,

Compensation and Corporate Governance Committee.

Tenth. - Consultative voting on the Annual Compensation Report.

Eleventh.- Approval and delegation of authority to formalize, enter and carry out the

resolutions adopted at the Meeting.

Twelfth. - Information regarding changes to the Board Rules.

SUPPLEMENT TO THE CALL AND PRESENTATION OF NEW PROPOSALS FOR RESOLUTION

Shareholders representing at least three percent of the capital stock may request that a

supplement to the call of General Shareholders’ Meeting be published in order to include one

or more items on the Agenda, so long as the new items are accompanied with supporting

arguments or are certified. This right shall be exercised by sending a certified notification

indicating the identity of the Shareholder(s) exercising said right and the number of shares

that they own, and must be received at the Company’s registered office within five days

following the date when the call of the General Shareholders’ Meeting was published.

The supplement to the call, if any, will be published no less than fifteen days prior to 29 June

2016, the date set for the Shareholders’ Meeting at first call.

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During the same period of time described above, Shareholders representing at least three

percent of Company equity may also present proposals based on matters already included or

which ought to be included in the Agenda of the already called General Shareholders’ Meeting.

The Company will assure distribution of these proposed resolutions and their accompanying

documentation.

RIGHT TO INFORMATION

Until the fifth day before the scheduled Meeting, Shareholders may request information which

they deem appropriate or clarification from the Board of Directors or they may submit written

questions which they deem relevant regarding items appearing in the Agenda. Additionally,

they may request information or clarification or submit written questions regarding any public

information which the Company has submitted to the CNMV since 25 June 2015, the date of

the last Annual Shareholders’ Meeting. For these matters, Shareholders may apply to the

Shareholder Office by telephone at 91-4809800; or by email at

accionistas@indracompany.com or use forms placed on the Company website for that purpose

(www.indracompany.com). In order to do this, Shareholders should present reliable

identification (DNI, passport, or NIE), as well as provide information regarding the shares they

own.

From publication of the call and until the holding of the Meeting, every Shareholder who

wishes to do so may review the following information at the corporate offices or the Company

website (www.indracompany.com) and request that it be delivered immediately and free of

charge:

(i) Call notice

(ii) The total number of Company shares and voting rights on the date the Meeting is called.

(iii) Documents referred to in Article 272 of the LSC (Annual Financial Statements and

Management reports of Indra Sistemas, S.A. and its Consolidated Group for fiscal 2015, as

well as the report from the external auditor), which will be submitted to the Annual

Shareholders’ Meeting for approval as Item One of the Agenda.

(iv) Also regarding Item One of the Agenda, the Annual Report on Corporate Governance,

which forms an integral part of the Management Report.

(v) The Annual Corporate Social Responsibility Report for 2015.

(vi) The report regarding the independence of the 2015 Financial Statements auditor drafted

by the Audit and Compliance Committee.

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(vii) Regarding Item Four of the Agenda, in accordance with the provisions of the Ley de

Modificaciones Estructurales (“LME”), the Company website (www.indracompany.com)

contains the following documents, which may be downloaded and printed:

a. The Segregation Project;

b. The Annual Financial Statements and Management Reports for the last three

fiscal years, as well as the corresponding Auditors’ Reports for Indra Sistemas, S.A.;

c. The Segregation balance sheets of the participating companies;

d. The current bylaws of the companies participating in the Segregation as publically

registered;

e. The identity of the Directors of the companies participating in the Segregation and

the date they began occupying their posts.

It is to be noted that the Segregation Project was uploaded to the Company website

(www.indracompany.com) where it could be downloaded and printed on 19 May 2016, and

that the other listed documents in this section (vii) were uploaded on this even date.

(viii) The entire text of the proposals and resolutions regarding Items of the Agenda as well as

reports from the Board of Directors or supporting information regarding their contents as

required by law (Items 7, 8, and 9) or which have been otherwise considered convenient.

(ix) The names, professional profiles and class of each of the Directors whose re-election is

proposed in Item Six of the Agenda, as well as the reports from the Nomination,

Compensation and Corporate Governance Committee referred to in Article 529.16 of the

Ley de Sociedades de Capital (“LSC”).

(x) The 2015 Annual Compensation Report drafted by the Board of Directors and referred to in

Item Ten of the Agenda.

(xi) As regards Item Twelve of the Agenda, the current version of the Board Rules as amended.

(xii) Procedures established by the Company in order to make distance voting possible and the

forms made available to Shareholders to do so. Without prejudice to the foregoing, such

information will be made available here regarding such procedures.

(xiii) In accordance with the provisions of Recommendation 6 of the Code of Good Corporate

Governance for Listed Companies, the Annual Reports of the Audit and Compliance

Committee and of the Nomination, Compensation and Corporate Governance Committee for

fiscal 2015 as well as the report from the Nomination, Compensation and Corporate

Governance Committee regarding related party transactions.

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Pursuant to the provisions of Article 40.2 of the Ley de Modificaciones Estructurales de las

Sociedades Mercantiles, an outline of the Segregation Project referred to in Item Four of the

Agenda follows:

1. Participating companies: Indra Sistemas, S.A., a Spanish company with its registered office

in Alcobendas (Madrid), Avenida de Bruselas 35, registered in the Mercantile Registry of

Madrid Volume 865, Folio 28, Section 8, page M-1133 as Segregated Company and Indra

Corporate Services, S.L.U., a Spanish company with its registered office in Alcobendas

(Madrid), Avenida de Bruselas 35, registered in the Registro Mercantil de Madrid Volume

34657, Folio 157, Section 8, page M-623410 as Beneficiary Company.

2. The assets of the Segregated Company which, as a business unit, are to be transferred to

the Beneficiary Company, are all of those items contained in the following functional areas

of Indra Sistemas: Centro de Servicios Administrativos (“Administrative Services Area”);

branch and permanent establishment administrative unit; cash management services;

workplace safety, health and wellbeing unit; compensation, human capital and personnel

management administrative services; switchboard; purchase order administration unit;

general services unit; security unit; administrative service charges for management control

unit; legal/administrative support unit for tenders; corporate social responsibility and

documentation departments; and quality administration services. Said assets are laid out in

detail in Appendix 1 to the Segregation Project and available on the Company website.

3. There shall be no exchange or distribution of Beneficiary Company shares to shareholders

of Segregated Company since, in accordance with Article 74.2 of the LME, said

shareholders are not entitled to receive Beneficiary shares.

As a consequence of the Segregation, there will be a change in the composition of the

capital stock of the Segregated Company, but there shall be no reduction in capital since, in

accordance with Article 71 of the LME, the Segregated Company shall receive shares in

Beneficiary Company in exchange for the transferred business unit. To this end, and in

consideration of the actual or reasonable value of the transferred business unit, the

Beneficiary Company shall increase its capital stock, currently fixed at THREE THOUSAND

EUROS (3,000 €), to ONE MILLION TWO HUNDRED FORTY-EIGHT THOUSAND EIGHT

HUNDRED SIXTY-EIGHT EUROS (1,248,868 €), that is, it shall increase in the amount of

ONE MILLION TWO HUNDRED FORTY-FIVE THOUSAND EIGHT HUNDRED SIXTY-EIGHT

EUROS (1,245,868 €), and to accomplish this there shall be created ONE MILLION TWO

HUNDRED FORTY-FIVE THOUSAND EIGHT HUNDRED SIXTY-EIGHT (1,245,868) new

indivisible shares with a par value of ONE EURO (1.00 €) each, fully subscribed and paid in,

which will begin in sequence at the end of the existing shares, and shall be numbered

3,001 through 1,245,868 inclusive.

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It shall be unnecessary for the Segregated Company to receive any cash for rounding

purposes or for completion of the trade of shares.

The new shares shall be wholly owned by the Segregated Company, Indra Sistemas, which

shall have the right to benefit from earnings of the Beneficiary Company begining on the

date in which said Segregation is registered in the Mercantile Registry of Madrid.

4. The Segregation will have no impact on prohibited types of capital contribution or on

ancillary benefits.

5. No special rights or advantages of any kind will be delivered.

(i)

6. The Segregation will take effect for accounting purposes on 1 January 2016.

7. The bylaws of the Beneficiary Company are those which are registered in the Registro Mercantil de Madrid, without prejudice to the increase in capital to be produced as a result

of the Segregation.

8. In accordance with the provisions of Article 44 of the Labour Statute, the Beneficiary

Company will be subrogated to the rights and obligations of personnel involved in the

transferred business unit. The Segregation will have no impact whatsoever on the

administrative bodies or the corporate social responsibility of the Company.

SPECIAL INFORMATION TOOLS

In accordance with article 539 of the LSC, the Company has a corporate website

www.indracompany.com, in order to make it easier for Shareholders to exercise their right to

information and in order to distribute information required by applicable law.

From the time of publication of this call and up until the moment that the Meeting begins, the

above mentioned Company website will contain an Electronic Shareholders Forum accessible

to all Shareholders as well as to voluntary shareholder associations which are registered in

the special Registry created for that purpose at the Comisión Nacional del Mercado de Valores

(“CNMV”).

Rules governing access and use of the Electronic Shareholders Forum are available for review

on the same Company website in the section dedicated to the Annual Shareholders Meeting.

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ATTENDANCE AND VOTING RIGHTS

Shareholders whose shares are registered in the books of account five days before the date

of the Meeting are allowed to attend. Each share shall be entitled to one vote at the Meeting.

In accordance with Article 197 bis of the LSC, the proposals contained in Items Six and Nine of

the Agenda are subject to individual and separate voting for each one of them, whether

voting is done in person or by electronic means made available by the Company for such

purpose. In the event that attendance cards provided by the share registry custodian do not

provide for individualized voting for each of the proposals, Shareholders may nonetheless

vote separately and individually for each proposal on the attendance card provided by the

custodian or on the card made available to Shareholders by the Company from the moment of

call on the Company website (www.indracompany.com). Otherwise, votes will be construed to

apply to all of the proposed resolutions contained in each of the above-mentioned items of

the Agenda. This card should be addressed to the Company duly signed, and it is essential that

in the event that the card placed at the disposal of Shareholders by the Company is used, that

it be sent with a photocopy of the owner’s DNI, NIE, or passport.

PROXY PROCEDURE AND PROCEDURE FOR LONG DISTANCE VOTING

The Board of Directors, under the power granted by Article 14 of the Bylaws and Articles 7

and 12 of the Board Rules, has authorized the following procedures and requirements for the

exercise of proxy rights and long distance voting at this Annual Shareholders Meeting:

1. Representation by long distance communication means

Shareholders not attending the Meeting may delegate their votes by any means indicated

below to another person, who need not be a Shareholder.

The designated representative who attends the Meeting must prove his or her identity in the

same fashion as attending Shareholders. The representative may exercise his or her proxy

and vote only by being physically present at the Meeting.

Any proxy or representation which does not expressly indicate the person to whom the proxy

is made or which is made generally to the Board of Directors will be conferred upon the

Secretary of the Meeting.

Unless otherwise indicated by the represented Shareholder, the proxy applies to resolutions

other than those drafted by the Board or to any matters permitted by law not included in the

Agenda which may be submitted to the Meeting.

In accordance with the provisions of Articles 523 and 526 of the LSC, it is to be noted that if

the representative is a Company Director, said representative may find himself in a situation

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of conflict of interest regarding Items 6.1, 6.2, 6.3, 6.4 and/or 10 of the Agenda, as well as

other proposals for resolutions not necessarily brought by the Board and regarding matters

which are not included in the Agenda which may nonetheless be submitted to vote at the

Meeting, when such is permitted by law.

For all proxies given to the Secretary of the Meeting or to a member of the Board of Directors

where the proxy card does not contain express instructions to vote against or to abstain, it is

understood that in all instances the represented Shareholder has given specific instructions to

vote in favour of all of the proposals drafted by the Board of Directors included in the Agenda.

In the event that a proxy be applied in the manner indicated above, should the proxy

empower the Secretary of the Meeting or a member of the Board of Directors, and the proxy

card contain no express instructions to vote in favour or to abstain, it will be understood that

the proxy has conferred instructions to vote against said proposals.

1.1. Delivery or Correspondence by mail

Proxy rights are conferred by filling in the section included for that purpose on the attendance

card provided by the share registry depository or that which the Company makes available to

Shareholders by means of its website (www.indracompany.com) in the section dedicated to

the General Shareholders’ Meeting. The Shareholder may obtain a Company proxy card by

downloading one from the website and printing it; retrieving one from the corporate offices;

or requesting that a copy be sent free of charge from the shareholder office.

The properly filled out and signed card should be sent by mail or hand delivered to the

corporate office (Oficina del Accionista, Av. de Bruselas 35, Alcobendas 28108, Madrid)

accompanied by a photocopy of an official government issued identification document.

No one may have more than one representative at the Meeting.

The Shareholder conferring his or her representation should communicate proxy and voting

instructions, if any, to the designated representative. When a proxy is given to a member of

the Board of Directors, the communication is complete upon receipt of the documentation

constituting same at the corporate office.

1.2. Electronic Means

The delivery of proxies and notice to the Company may be made electronically through the

Company website (www.indracompany.com.) The procedure that a Shareholder must follow

for exercising his right to vote is explained there in detail. The Shareholder must prove his or

her identity by means of an unexpired electronic DNI or a recognized irrevocable electronic

certificate issued by the Fábrica Nacional de la Moneda y Timbre (FNMT).

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2. Long Distance Voting

Shareholders may exercise their right to vote without the need of attending the Meeting

using means indicated below. Shareholders who vote in this way will be considered present

for the purposes of quorum.

2.1. Hand or Mail Delivery

The exercise of the right to vote by this procedure is accomplished by filling out the

appropriate section of the attendance card provided by the share depository or by completing

the one made available by the Company to Shareholders on its website

(www.indracompany.com) in the section dedicated to the General Shareholders’ Meeting. The

Shareholder may obtain a Company voting card by downloading and printing from the website,

by retrieving one from the corporate office or requesting one be sent free of charge from the

Shareholder Office.

A properly filled out card with original signature should be sent to the company office by post

or it may be hand delivered to the corporate office (Oficina del Accionista, Av. de Bruselas 35,

Alcobendas 28108, Madrid) accompanied by a photocopy of a government issued

identification document.

In the event that the card does not indicate the way to be voted, it will be assumed in all

cases that the Shareholder votes in favour of each of the proposed resolutions formulated by

the Board of Directors which appear in the Agenda published at call.

2.2. Electronic Means

Votes may be cast electronically by means of the system designed for such on the Company

website (www.indracompany.com). There, the Shareholder will find detailed explanation of

the procedure to follow in order to exercise voting rights. The Shareholder who wishes to use

this voting procedure must prove his identity using an unexpired electronic DNI or using a

recognized irrevocable electronic certificate issued by the Fábrica Nacional de la Moneda y

Timbre (FNMT).

3. Rules common to the exercise of proxy rights and long distance voting

3.1. Identity Verification

The Company reserves the right to verify information given by each Shareholder by matching

it with that provided by Iberclear, the entity in charge of the book entries for Company shares.

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In the event of a discrepancy between the number of shares communicated by the

Shareholder on the proxy card, by electronic voting, or by forms made available on the

corporate website (www.indracompany.com) and the number in the book entries as

communicated by Iberclear, the number of shares registered by Iberclear shall be considered

valid for quorum and voting purposes.

3.2. Artificial Persons

In the case of artificial person Shareholders, the Company reserves the right to require

evidence of the sufficiency and currency of the power of attorney presented by the natural

person acting in the Shareholder’s place.

3.3. Time Limit for Receipt by the Company

In order for proxies and distance votes to be valid they must be received by the Company

before 9:00 a.m. on 29 June 2016, the date planned for first call of the Meeting.

3.4. Revocation and Priority

(i) Proxies and exercise of the right to vote by long distance communication are always

revocable and should be revoked expressly and by the same means used for their delivery

within the period established for said voting.

(ii) Physical attendance of the Shareholder at the Meeting, as well as attendance by means

of a vote delivered by long distance revokes any proxy regardless of its date or form.

(iii) Physical attendance of the Shareholder at the Meeting revokes any vote sent by long

distance communication.

(iv) Any vote or proxy submitted by electronic means will always prevail over a vote made by

hand delivery or post.

3.5. Responsibility for Custody of the Electronic Certificate and the Devices for

Creating the Electronic Signature

(i) The Shareholder is exclusively responsible for the diligent use of his or her electronic DNI

and the data for creating electronic signatures and for custody of the electronic certificate for

exercising proxy rights or distance voting through electronic means.

(ii) The Shareholder using an electronic signature is responsible for proving that the

electronic certificate used has not expired or been revoked, suspended, or otherwise made

invalid at the moment the electronic signature is generated.

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3.6. Availability of Service

(i) The Company reserves the right to modify, suspend, cancel or restrict voting mechanisms

and electronic proxies when technical or security reasons so require.

(ii) The Company will not be responsible for any damages which might be suffered by the

Shareholder as a result of outages, overloads, fallen communication lines, connection failures,

postal service malfunction or any other eventuality of an equal or similar nature outside the

control of the Company which might hamper or impede the Shareholder from exercising voting

rights or proxy rights by long distance communication.

DATA PROTECTION

Pursuant to the provisions of the Ley Orgánica de Protección de Datos de Carácter Personal

15/1999, personal data that Shareholders or their representatives send to the Company in

order to exercise their rights to information, attendance rights, proxy or voting rights at the

Shareholders’ Meeting, or which may be sent by banks and Securities Brokers where

Shareholders have their shares deposited through Iberclear, will be used for the purposes of

facilitating the development, compliance and management of Shareholder relationships and,

where applicable, Shareholder representative relationships. Consequently, notice is given that

such data is collected in a file belonging to the Company and that right to access, correction,

cancellation and opposition may be made by communicating in writing to (Oficina del

Accionista, Av. de Bruselas 35, Alcobendas 28108, Madrid).

Additionally, notice is given that an audiovisual recording of the entire Meeting may be made

in order to facilitate its progress and to adequately distribute it. Said recording will be

retransmitted and will be made available to the public on the Company website

(www.indracompany.com).

Owners of data will always have the right in accordance with applicable law to access, correct,

oppose or delete any images recorded by INDRA. Said rights may be exercised through the

above indicated address.

NOTARIAL PARTICIPATION AT THE MEETING

The Board of Directors has agreed to require the presence of a Notary to record the minutes

of the Shareholders’ Meeting in accordance with that contained in Article 203.1 of the LSC.

Shareholders are informed that the Meeting may be held at second call, that is, on 30

June 2016 at 12:30 p.m.

17

Beginning one hour prior to the beginning of the Meeting and in the place where it is being

held, Shareholders and their properly appointed representatives may present their attendance

cards and proxies and, where applicable, documents confirming their legal representation, to

personnel charged with registration of Shareholders.

José Antonio Escalona de Molina

Secretary of the Board of Directors

18

b. Items 1, 2 and 3 of the Agenda

First.- Approval of the individual and consolidated Financial Statements and

the Management Report for fiscal 2015

PROPOSED RESOLUTIONS

1. “Approve the Annual Financial Statements and the Management Report for Indra Sistemas, S.A. for the fiscal year ended 31 December 2015 and drafted by the Board of Directors at its meeting held 17 March 2016.

In accordance with procedures followed by the Company regarding corporate governance, attention is expressly directed to Note 37 of the individual Annual Report and to section C.1.45 of the Annual Report on Corporate Governance which is incorporated into the Management Report, where obligations assumed by the Company in the event of termination of the contractual relationship of senior management -- including Executive Directors -- are described.

The annual financial statements reflect losses of 466,181,909.77 €.”

2. “Approve the consolidated Annual Financial Statements and the Management Report of the group of companies headed by Indra Sistemas, S.A. corresponding to the fiscal year ended 31 December, 2015 and drafted by the Board of Directors on 17 March, 2016. The consolidated Financial Statements show losses of 641,852 thousand euros, of which 641,189 thousand euros are attributable to the parent company.”

19

Second. - Approval of the proposed allocation of losses for fiscal 2015.

The annual financial statements for the fiscal year ended 31 December, 2015 drafted by the Board of Directors at its meeting held 17 March 2015 show losses in the amount of 466,181,909.77 €.

It is proposed that said result be applied as follows:

- 466,181,909.77 € Loss carried forward

In accordance with the provisions of Article 273.4 of the LSC, the Company possesses a capital reserve equivalent to 5% of goodwill shown on the Company balance sheet, making unrestricted reserves available to it in the event of negative earnings:

14,012,547.70 € goodwill -14,012,547.70 € voluntary reserves

20

Third.- Approval of management by the Board of Directors for the

fiscal year ended 31 December, 2015.

PROPOSED RESOLUTION

“Approve management of the Board of Directors during the fiscal year ended 31

December 2015 based upon information contained in the Annual Financial Statements

and the Management Report.”

REASONS FOR THE PROPOSALS

The Financial Statements and the Management Report for the 2015 fiscal year are

made available to the Shareholders and were communicated in accordance with law

to the Comisión Nacional del Mercado de Valores (“Spanish Securities Market

Commission” or “CNMV”) on 21 April, 2016.

The Financial Statements include the balance sheet, the income statement, a

statement of recognised income and expense, statement of owners' equity, a

statement of cash flows and the Annual Report.

The Management Report includes, among other things, the Annual Report on

Corporate Governance.

The Financial Statements and Management Report have been certified by the Chief

Executive Officer and the Chief Financial Officer of the Company, verified by the

Audit and Compliance Committee prior to its preparation by the Board, and audited

by the independent firm KPMG without any exceptions or reservations.

In accordance with the requirements of the Ley de Mercados de Valores (“Securities

Exchange Act” or “LMV”), the Directors of the Company have signed a declaration of

responsibility relating to the contents of the Financial Statements and the

Management Report for the 2015 fiscal year.

The proposed allocation of losses is in accordance with the provisions of Article

273.4 of the LSC, which requires that a capital reserve equivalent to 5% of goodwill

as shown on the balance sheet be available, and that unrestricted reserves be

applied to it in the event of negative earnings.

The Annual Corporate Governance Report details the activity and workings of the

Board and its committees during the fiscal year as well as the level of achievement

21

by the Company of the recommendations contained in the Code of Good Corporate

Governance for Listed Companies.

The Annual Report on Corporate Social Responsibility gives a complete view of

Indra’s social and environmental performance, and offers a global and holistic

description of its impact on all its stakeholders. Said Report was reviewed by the

Nomination, Compensation and Corporate Governance Committee and approved by

the Board of Directors on May 26th, 2016. Its content has also been verified by

KPMG Asesores.

Based on the above, the Board proposes that the Shareholders approve the

Financial Statements and the Management Report of Indra and its Consolidated

Group, the allocation of losses included in same, as well as the management and

actions of the Board during the 2015 fiscal year.

Additional Documents: The Financial Statements and Management Report of Indra

Sistemas, S.A. and its Consolidated Group for the fiscal year ended December 31, 2015

and their respective audit reports, the Annual Report on Corporate Governance, which is

an integral part of the Management Report, as well as the Annual Report on Corporate

Social Responsibility, are made available together with this document to the Shareholders

on the Company website at the moment the Meeting is called. Shareholders will also find

the information made public 29 February, 2016 concurrent with publication of the

Activity Report and Results for 2015 as well as information the Company makes regularly

available to Shareholders and interested investors at the Company web site

(www.indracompany.com) Click “Presentation to Investors” then “Corporate Presentation.”

22

c. Item 4 of the Agenda. Approval of the Segregation between Indra

Sistemas, S.A. as Segregated Company and Indra Corporate Services, S.L.U.

as Beneficiary Company, in accordance with the Segregation Project approved by the respective administrative bodies.

PROPOSED RESOLUTION

“Approve the Segregation of a business unit from Indra Sistemas, S.A. (“Segregated Company” or “Indra Sistemas”), which business unit consists of resources currently dedicated to providing specific administrative services to Indra Sistemas, S.A. and other companies in the group, to its wholly owned subsidiary Indra Corporate Services, S.L.U. (“Beneficiary Company”).

(a) Approval of the Segregation Balance Sheet

In accordance with the provisions of the first paragraph of Article 36.1 of the Ley de Modificaciones Estructurales (“Corporate Restructuring Act” or “LME”), approve wholly and without exception as the Segregation Balance Sheet the balance sheet closed 31 December 2015 and made part of the Annual Financial Statements for the fiscal year ended 31 December, 2015 approved at the Meeting under Item 1 above.

Additionally, in accordance with the provisions of Article 37 of the LME, i t is averred that the above referenced Segregation Balance Sheet has been verified by the auditor of the Company’s financial statements. The Segregation Balance Sheet contains no changes in valuations.

(b) Approval of the Transfer

In accordance with the provisions of Article 40.1 of the LME, approve the transfer, which

entails: (i) transfer of the entirety of a business unit consisting of assets of the

Transferor (which will not be dissolved) to the Transferee, and (ii) an increase in the

capital stock of the Transferee in a proper amount so that the Transferor may receive

shares created by Transferee.

The Beneficiary Company, Indra Corporate Services, S.L.U., is a wholly owned subsidiary

of the Segregated Company. As such, the transaction is considered a special type of

Segregation under Articles 52 and 73.1 of the LME and therefore is exempt under Article

49 of the LME from the requirement to produce a report from administrators or from

experts.

Therefore, the Segregation agreed to by all members of the companies’ administrative

bodies on 29 April, 2016 is ratified, as well as the Segregation procedure carried out

23

in strict conformance with said agreement. The Segregation is reproduced in part in

compliance with Article 228.1 of the Reglamento del Registro Mercantil (“Commercial

Registry Regulations” or “RRM”), wherein are described the “necessary circumstances”

contemplated by said Article, except for the content of the appendices, due to their

length, and which appear below for convenience:

“1. IDENTITY OF THE COMPANIES PARTICIPATING IN THE TRANSFER

1.1. Segregated Company:

(i) Name: Indra Sistemas, S.A.

(ii) Type of Company: Sociedad Anónima.

(iii) Address: Alcobendas (Madrid), Avenida de Bruselas 35.

(iv) Data of the Company registration in the Commercial Registry: Registered in the Commercial Registry of Madrid, Volume 865, Folio 28, Section 8, page M-1133.

1.2. Beneficiary Company:

(i) Name: Indra Corporate Services, S.L.U.

(ii) Type of Company: Sociedad de Responsabilidad Limitada.

(iii) Address: Alcobendas (Madrid), Avenida de Bruselas 35.

(v) Data of the Company registration in the Commercial Registry: Registered in the Commercial Registry of Madrid, Volume 34657, Folio 157, Section 8, page M-623410.

2. ASSETS TO BE TRANSFERRED

2.1. PRECISE DESCRIPTION AND CHARACTERISTICS OF ASSETS AND LIABILITIES TO BE TRANSFERRED TO TRANSFEREE. VALUATION OF ASSETS TO BE TRANSFERRED

2.1.1. The assets of the Segregated Company which, as a business unit, are to be transferred to the Beneficiary, are all of those items contained in the following functional areas of Indra Sistemas: Centro de Servicios Administrativos (“Administrative Services Area” or “CSA”); branch and permanent establishment administrative unit; cash management services; workplace safety, health and wellbeing unit; compensation, human capital and personnel management administrative services; switchboard; purchase order administration unit; general services unit; security unit; administrative service charges for management control unit; legal/administrative support unit for tenders; corporate social responsibility and

24

documentation departments; and quality administration services. Pursuant to the provisions of Article 74.1 of the LME, said assets are laid out in detail in Appendix 1 to this Segregation Project. The Beneficiary Company will also be subrogated to the contractual position of Indra Sistemas regarding those contracts which are part of and which are affected by any economic unit which is the object of the Segregation

2.1.2. In accordance with Article 31.9 of the LME as it relates to Article 74 of the LME, the total valuation of the assets to be transferred appears in the following section.

2.2. RECEIPT OF SHARES OF THE BENEFICIARY COMPANY BY THE SEGREGATED COMPANY AND THE DATE UPON WHICH THE NEW SHARES ACQUIRE THE RIGHT TO RECEIVE EARNINGS

2.2.1. There shall be no exchange or distribution of Beneficiary Company shares to shareholders of Segregated Company since, in accordance with Article 74.2 of the LME, said shareholders are not entitled to receive Beneficiary Company shares.

2.2.2. As a consequence of the Segregation, there will be a change in the composition of the capital stock of the Segregated Company, but there shall be no reduction in capital since, in accordance with Article 71 of the LME, the Segregated Company shall receive shares of the Beneficiary Company in exchange for the transferred business unit.

2.2.3. To this end, and in consideration of the actual or reasonable value of the transferred business unit, the Beneficiary Company shall increase its capital stock, currently fixed at THREE THOUSAND EUROS (3,000 €), to ONE MILLION TWO HUNDRED FORTY-EIGHT THOUSAND EIGHT HUNDRED SIXTY-EIGHT EUROS (1,248,868 €), that is, it shall increase in the amount of ONE MILLION TWO HUNDRED FORTY-FIVE THOUSAND EIGHT HUNDRED SIXTY-EIGHT EUROS (1,245,868 €), and to accomplish this there shall be created ONE MILLION TWO HUNDRED FORTY-FIVE THOUSAND EIGHT HUNDRED SIXTY-EIGHT (1,245,868) new indivisible shares with a par value of ONE EURO (1.00 €) each, fully subscribed and paid in, which will begin in sequence at the end of the existing shares, and shall be numbered 3,001 through 1,245,868 inclusive.

It shall be unnecessary for the Segregates Company to receive any cash for rounding purposes or for completion of the trade of shares.

The new shares shall be wholly owned by the Segregated Company, Indra Sistemas, which shall have the right to benefit from earnings of the Beneficiary Company beginning on the date in which said Segregation is registered in the Registro Mercantil de Madrid.

25

3. IMPACT ON PROHIBITED TYPES OF CONTRIBUTIONS TO CAPITAL OR ANCILLARY BENEFITS

3.1. The Segregation will have no impact in this regard, given that neither of the companies allow contributions to capital other than goods or rights liable to economic appraisal (Article 58 of the LSC), there are no existing ancillary benefits, and no compensation whatsoever will be paid to any shareholders of the companies participating in the Segregation.

4. SPECIAL RIGHTS

4.1. There are no shareholders or equity interest owners with special rights nor are there holders of securities other than shares or equity interests. Therefore, no special rights will be granted nor any type of option offered to any person.

5. INDEPENDENT EXPERTS AND ADVANTAGES FOR ADMINISTRATORS

5.1. No type of advantage will accrue either to any administrator of the participating companies or to the Segregated Company.

5.2. Given that the Beneficiary Company is a sociedad de responsabilidad limitada (“limited liability company”) and, in addition, is a wholly owned subsidy of the Segregated Company, under the provisions of Articles 52.1, 77 and 78 of the LME, the Segregation may be executed without the need for a concurring expert opinion.

6. EFFECTIVE DATE OF SEGREGATION FOR ACCOUNTING PURPOSES

6.1. The Segregation shall take place for accounting purposes on 1 January 2016, in accordance with the General Accounting Plan.

7. BYLAWS OF THE TRANSFEREE

The bylaws of the Beneficiary Company are those which are registered in the Registro Mercantil de Madrid, without prejudice to the increase in capital to be produced as a result of the Transfer described in section 2.2. above, and which will eventually come about as a result of the split-off.

8. FINANCIAL STATEMENT DATES FOR THE ENTITIES PARTICIPATING IN THE SEGREGATION

8.1. The financial statements used as a basis for the transaction arising from this Project shall be (i) the closing balance sheet on 31 December 2015 for Indra

26

Sistemas, which forms part of the Annual Financial Statements which are submitted for approval to the Annual Shareholders’ Meeting of Indra Sistemas, S.A. for 2016 and (ii) the closing balance sheet on its date of incorporation in the case of the Beneficiary Company.

8.2. In accordance with the provisions of Article 37 of the LME, the balance sheet of Indra Sistemas is audited. The Beneficiary Company has no obligation to have its annual financial statements audited.

9. POSSIBLE CONSEQUENCES OF THE SEGREGATION ON EMPLOYMENT, AS WELL AS ITS GENERAL LONG TERM IMPACT ON THE ADMINISTRATIVE BODIES AND CORPORATE SOCIAL RESPONSIBILITY OF COMPANY

In accordance with the provisions of Article 44 of the Labour Statute, the Beneficiary Company will be subrogated to the rights and obligations of personnel involved in the transferred business unit. The Segregation will have no impact whatsoever on the administrative bodies or the corporate social responsibility of the Company.

10. TAX RULES

10.1. Since the Segregation complies with the requirements contained in Chapter VII of Title VII of Ley 27/2014 of 27 November regarding taxation of companies under the special rules for mergers, asset transfers, securities swaps, and changes of registered office, the special rules are applicable to this Segregation.

10.2. Therefore, in compliance with the requirements contained in Corporate Tax rules, the Beneficiary Company will communicate completion of the present Transfer to the competent Tax Authorities once said Transfer has been registered in the Registro Mercantil.’

c) Tax rules

As indicated in the Transfer Agreement, since the Segregation complies with the requirements contained in Chapter VII of Title VII of Ley 27/2014 of 27 November regarding taxation of companies under the special rules for mergers, asset transfers, securities swaps, and changes of registered office, said special rules are applicable to this Transfer. Therefore, in compliance with the requirements contained in Corporate Tax rules, the Beneficiary Company will communicate completion of the present Transfer to the competent Tax Authorities once said Transfer has been registered in the Registro Mercantil.

d) Delegation of Powers Related to the Segregation

27

The Chairman, Secretary and Vice Chair of the Board of Directors and each of them indistinctly shall have the power to act in the name of and represent the Company (either individually or in coordination, in their discretion, with the other party to the Segregation) in order to:

(i) report to Company employees regarding the Segregation, and generally comply with the Disposición Adicional Primera of the LME and Articles 44 and 64 of the Labour Statute; (ii) perform any activities or supervision before any natural or artificial person, public or private, of any nationality (such as the Registro Mercantil, the Registro de la Propiedad or any other registries) which they deem fit, for example:

- publish the Segregation agreement, in accordance with the provisions of Article 43.1 of the LME, once in the “Boletín Oficial del Registro Mercantil” and in one of the daily newspapers of general circulation in the Province in which the Beneficiary Company and the Segregated Company have their registered offices or, should such be more convenient, rely upon an individual communication system as authorized in Article 43.2 of the LME; and

- provide guarantees to satisfy any creditors who may exercise their right to object, or ensure that a credit entity provide such a guarantee in accordance with the terms of Article 44 of the LME.

(iii) reach any agreements and negotiate and deliver any public or private documents necessary or convenient in accordance with applicable law in order to register or generally to execute the agreements adopted at the Annual Shareholders’ Meeting of the Company and the consequences of said agreements. The above includes, for example, appearing before a notary public in order to issue the following documents together with the agreements and affidavits which accompany them, including:

- clarifying or correcting any of the details included in any document or agreements made public; - issuing corrective, complementary, or explanatory documents when such become necessary in order to accomplish the filing of the Segregation with the Registro Mercantil;

- requesting, if necessary, that a partial registration of the relevant documents be accepted in the Registro Mercantil should a portion of them be rejected for filing .”

28

JUSTIFICATION FOR THE PROPOSAL

The proposed transaction is part of the project of creating a Shared Services Center by

Indra Sistemas, S.A., a center which will provide centralized administrative services to

Indra Sistemas as well as other companies within its group.

This transaction will permit:

Centralization within a single business unit the provision of administrative

services to Indra Sistemas and other entities within the Indra Group, with an

accompanying improvement in those services by means of integrated

management.

Promotion of continuous improvement in levels of services provided.

Enablement and support for the provision of administrative services to third

parties not a part of the Indra Group.

Streamlining and simplification of organizational structures in this area.

Achievement of more homogenization and efficiency in processes and

systems.

In light of the above, it is proposed that the Shareholders approve the Segregation by

Indra Sistemas, S.A. of the business unit consisting of assets which currently are

dedicated to the provision of specific administrative services to the Transferor and other

companies within the group to its wholly owned subsidiary Indra Corporate Services,

S.L.U. as Transferee, using as the Segregation balance sheet the closing balance for the

end of the fiscal year as submitted for approval at the Meeting in Item 1 of the Agenda.

It is also proposed that this Segregation be submitted under the non-taxable activity

rules provided for in Ley 27/2014, of 27 November, regarding Corporate Taxation.

Documents attached: information required by Ley 3/2009, of 3 April, regarding

structural changes in commercial enterprises; that is: the Segregation Project, the annual

financial statements and management reports for the past three fiscal years for Indra

Sistemas, S.A. accompanied by its Auditor Reports (legally required of the Company);

Segregation balance sheets for the participating companies; the current bylaws of said

companies and relationships between their administration, giving their particulars and the

dates in which they rose to their posts.

29

d. Item 5 of the Agenda Appointment of auditors for the individual and

consolidated Annual Financial Statements and Management Report corresponding

to fiscal 2016, 2017 and 2018.

PROPOSED RESOLUTION

“In accordance with the provisions of Article 264.1 of the LSC and upon motion by the

Audit and Compliance Committee, DELOITTE, S.L. shall be appointed as auditor of the

individual and consolidated Annual Financial Statements and Management Report of the

Company corresponding to fiscal 2016, 2017 and 2018.”

REASON FOR THE PROPOSAL

Once Ley 22/2015 of 20 July regarding Auditing of Accounts was ratified, which

determined the options available in Spain among those contained in the “Regulation (EU)

No. 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific

requirements regarding statutory audit of public-interest entities,” the Audit and

Compliance Committee solicited proposals for designation as Account Auditor for the

upcoming fiscal years. The bid process – to which several prestigious and internationally

experienced auditing firms were invited – was carried out under conditions imposed by

the Committee ensuring the highest level of independence. Also, during the process the

Committee took the necessary steps to ensure that the firm to be proposed met all

eligibility requirements and possessed the independence and qualities imposed by the

above mentioned legislation.

In light of the proposals presented and other considerations, the Audit and Compliance

Committee, in carrying out is duties under Article 529.14 4 e) of the LSC, brought to the

Board the proposal that Deloitte, S.L. be named Account Auditor for Indra Sistemas, S.A.

and its consolidated group for fiscal 2016, 2017, and 2018.

Given the proposal of the Committee, the Board of Directors agreed to bring the same

proposal to the Annual Shareholders’ Meeting.

30

e. Item 6 of the Agenda. – Re-election of Directors.

PROPOSED RESOLUTIONS

6.1 Re-elect as Director for the statutory period of 3 years as an Independent Director

upon proposal by the Nomination, Compensation and Corporate Governance Committee,

Mr. Luis Lada Díaz. Identifying information regarding the proposed Director will be

entered into the Registro Mercantil.

6.2 Re-elect as Director for the statutory period of 3 years as an Independent Director

upon proposal by the Nomination, Compensation and Corporate Governance Committee,

Mr. Alberto Terol Esteban. Identifying information regarding the proposed Director will be

entered into the Registro Mercantil.

6.3 Re-elect as Director for the statutory period of 3 years as a Proprietary Director

upon proposal by the Board of Directors, Mr. Juan March de la Lastra as representative of

the equity interest of Corporación Financiera Alba, S.A. Identifying information regarding

the proposed Director will be entered into the Registro Mercantil.

6.4 Re-elect as Director for the statutory period of 3 years as a Proprietary Director

upon proposal by the Board of Directors, Mr. Santos Martínez-Conde Gutiérrez-Barquín as

representative of the equity interest of Corporación Financiera Alba, S.A. Identifying

information regarding the proposed Director will be entered into the Registro Mercantil.”

Consistent with the provisions of Article 197 bis of the LSC, proposals included in this

Agenda Items are to be voted upon individually and separately whether votes are cast in

person or electronically by means created by the Company for such purpose. In the event

that attendance cards issued by share depositories do not individually break out each of

the proposals, Shareholders may indicate their votes for each of them separately and

individually in the same attendance card or on the form which the Company makes

available to Shareholders on its website (www.indracompany.com) upon call of the

Meeting. The card used by the Shareholder should be properly signed.

31

REASONS FOR THE PROPOSALS

The Board has adopted the proposal from the Nomination, Compensation and Corporate

Governance Committee for re-election of Messrs. Lada and Terol and proposes, after a

favourable report from the same committee, the re-election of Messrs. March and

Martínez-Conde.

With this proposal of the Board, it would continue to contain 13 members, two of whom

would be Executive and the rest non-Executive. Of those, 7 Directors would be

Independent, representing 53.8% of members of the Board. In addition, the proportion of

Proprietary Directors would remain plainly representative of the Shareholder structure of

the Company. This composition of the Board fully complies with that contained in the

Board Rules and the Code of Good Governance for Listed Companies as regards the size

and qualitative composition of the Board, as well as international standards related to

independence of the Board.

In crafting the proposal for re-election of Directors brought before the Meeting, upon

proposal from the Nomination, Compensation and Corporate Governance Committee in the

case of the Independent Directors and the Board, after a prior favourable report from the

Nomination, Compensation and Corporate Governance Committee for the Proprietary

Directors, the Board of Directors took the following factors into consideration:

As regards the sufficiency of knowledge possessed by the Directors whose re-

election is proposed, the professional profiles required by the Board should be

judged based on the following criteria:

o The Board has expressed in its Selection Policy for Directors and has

stated publically on various occasions what profiles are required for its members,

the last time during the Annual Shareholders Meeting in 2015, when it stated that

“the group must include sufficient knowledge, experience and capabilities in the

following areas: (i) knowledge of the sectors in which the Company does business

as well as related sectors with similar traits; (ii) economics and financial control;

(iii) evaluation and supervision of senior managers along with a high level of

competence in human resources; (iv) the general economic context and the

context of the geographic markets most relevant to the Company; and (v)

management and entrepreneurship.”

o Mr. Lada has extensive professional experience in diverse companies in the

information technology sector; in economic and financial matters, auditing and

control; in economics in general; international experience in geographical markets

of importance to the Company; and business management experience.

32

o Mr. Terol possesses extensive experience and knowledge in the sectors in

which the Company operates; in economic and financial matters, auditing and

control; in economics in general; international experience in geographical markets

of importance to the Company; and business management and entrepreneurship.

o Mr. March is Executive Chairman of Banca March and an executive director

of Corporación Financiera Alba and has extensive experience in economic and

financial matters and control; in economics in general; business management and

entrepreneurship, as well as international experience.

o Mr. Martínez-Conde is CEO of Corporación Financiera Alba and director of

Banca March and has extensive experience in economic and financial matters and

control; in economics in general; and business management and entrepreneurship.

Capacity for dedication required in order to carry out their duties of each of the

Directors proposed for re-election.

The Nomination, Compensation and Corporate Governance Committee has verified

that the other professional activities of the Directors whose re-election is proposed,

and whose professional profiles are available on the Company website and in the

area created upon call of the Meeting in the corresponding Agenda Item, allow them

to devote sufficient and effective dedication to the Board of Directors and the rest of

the Committees of which they are members at Indra.

Past performance in their post for the Directors whose re-election is proposed.

The Board has issued a very favourable review of their performance during the prior

three year term. During said evaluation, their high level of attendance at meetings of

the Board and of the committees to which they belong was also taken into

consideration, which attendance was as follows: (i) in the case of Mr. Lada: Board of

Directors 87% and Strategy Committee 100%; (ii) in the case of Mr. Terol: Board of

Directors, 87%, Strategy Committee 100% Audit and Compliance Committee 100%;

(iii) in the case of Mr. March: Board of Directors 80%, Strategy Committee 75%,

Nomination, Compensation and Corporate Governance Committee, 87.5%; and (iv) in

the case of Mr. Martínez-Conde: Board of Directors, 100%, Audit and Compliance

Committee, 93.33% and Nomination, Compensation and Corporate Governance

Committee, 100%.

In every case when a Director was unable to personally attend a Board or committee

meeting, he delivered a proxy to another member of the Board with voting

instructions.

33

Maintenance of the requirements for the Director category for each Director

considered.

Upon approval of the Annual Report on Corporate Governance, the Board specifically

examined compliance with the legal definition for Independent Directors contained in

section four of Article 529.12 of the LSC, and concluded that no professional or

personal circumstances exist which would affect their independent status. The

tenure of the Independent Directors whose re-election is proposed is nine years in

the case of Mr. Lada and six years in the case of Mr. Terol.

As regards the Proprietary Directors, in accordance with the provisions of the Board

Rules, the Nomination, Compensation and Corporate Governance Committee has

verified that the significant shareholder whose interests are represented on the

Board has maintained as of this date the equity participation in the Company which

allowed its representation on the Board.

Gender Diversity

Board Rules provide that the Nomination, Compensation and Corporate Governance

Committee pay particular attention to criteria which promote gender diversity

amongst members of the Board when selecting candidates for directorships. It has

done this in the past few years during replacement of Directors, although it is in the

area of Independent Directors where the Board and the Nomination, Compensation

and Corporate Governance Committee have the greatest capacity to act, given the

much wider field of candidates available to fill those posts. As for Proprietary

Directors, the Board and the Committee may only recommend that Shareholders

consider appointment of women to represent their equity interests; in the case of

Executive Directors, circumstances have yet to arise that make the appointment of a

woman possible. For its part, the current Selection Policy for Directors has as a goal

that by the year 2020 the number of female Board members represent at least thirty

percent of the total.

Upon approval by the Shareholders of the re-election of the proposed nominees, the

Board will maintain its number of two women members, who represent 28% of the

Independent Directors and 18% of the External Directors.

Following Company practice in these matters and consistent with best practices in

corporate governance, proposals for appointment and re-election of Directors are to be

voted upon individually and separately whether votes are cast in person or electronically

by means created by the Company for such purpose. In the event that attendance cards

issued by share depositories do not provide for voting for each Director individually,

Shareholders may indicate their votes for each of them separately and individually on the

34

same attendance card or on a document attached to it, delivered to the Company, and

properly signed.

COMPOSITION OF THE BOARD OF DIRECTORS 2016

External Directors 11

Independent Directors

7

Proprietary Directors

4

Shareholder SEPI 2

Shareholder CFA 2

Executive Directors 2

Chairman 1

CEO 1

TOTAL 13

Additional Documents: Current professional profiles of the Directors whose re-election

is proposed (said profiles contain identifying information, C.V. and class of Director) as

well as the resulting composition of the Board by Director class upon approval of the

resolution brought before the Meeting will be made available to Shareholders upon call to

order on the Company website. The reports drafted by the Nomination, Compensation and

Corporate Governance Committee and by the Board in accordance with the provisions of

Article 529.16 of the LSC will also be made available separately to Shareholders.

35

f. Item 7 of the Agenda.- Delegation to the Board of Directors, with express

power to sub-delegate, the authority to increase the capital stock of the

Company consistent with the conditions contained in Article 297.1.b) of the LSC,

including by means of the issuance of redeemable shares, and the authority to

exclude pre-emptive rights, in which case any increase of capital pursuant to this

delegation may not exceed 20% of the capital stock of the Company at the time

of authorization at the Annual Shareholders’ Meeting, it being understood that

said limitation includes the amount of any increase in capital which may arise

from the approval and execution of the proposal contained in Item 8 of the

Agenda.

PROPOSED RESOLUTION

In accordance with the report drafted by the Board of Directors under the provisions of

Article 286 of the LSC, delegate to the Board the power to increase, in one or more

tranches, the capital stock of the Company at any time and under terms and limits

contained in Article 297.1 b) of the LSC, that is, within five years from the date of

adoption of the resolution and in an amount not to exceed one half of the current capital

of the company.

Increases in capital stock carried out under this authority will be done by means of

issuance and sale of new shares, with or without a share premium, and paid for in cash.

For each increase, it will be up to the Board to decide if the new shares should be common, preferred, redeemable, non-voting or any other type permitted by law. It is further agreed to empower the Board to set the terms and conditions of any

increases in capital stock and the types of shares when such are not made explicit in this

resolution, as well as freely offering new unsubscribed shares during the period or

periods for exercising pre-emptive rights. The Board may also decide that, in the event

that the capital increase is not fully subscribed, that such increase shall only be in the

amount actually subscribed and that the corresponding article in the Bylaws will be

amended regarding capital stock and number of shares.

For any of the increases in capital stock realized under the aegis of the present authority,

the Board shall have the power to waive, partially or entirely, any pre-emptive rights

under the terms of Article 506 of the LSC, so long as this authority is limited to increases

in capital stock brought about under this resolution, so long as its purpose is consistent

with Item 8 of the Agenda, and so long as the maximum amount authorized, in the

aggregate, is no more than 20% of the current capital stock of the Company.

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The Company may apply, when appropriate, for permission to trade the shares issued by

the Company pursuant to this authority on secondary markets whether regulated or not,

over the counter or on an exchange, domestic or foreign, and the Board is empowered0 to

carry out procedures necessary for listing with competent bodies of the various national

or foreign securities markets.

The Board of Directors is expressly authorized by these presents to delegate, under the

provisions of Article 249 bis section L) of the LSC, the power to develop, complete,

implement, interpret and correct capital stock increases referred to this agreement.

The current delegation of authority will render null and void any unused portion of that

authority granted at the Meeting held 21 June 2012.

Additional Documents: the report drafted by the Board of Directors in accordance with

Article 286 of the LSC justifying the proposal made for this Agenda Item will be made

available to Shareholders upon call to order at the corporate website.

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g. Item 8 of the Agenda. Delegation to the Board of Directors, with express

power to sub-delegate, the authority to issue in one or more offerings, bonds or

debentures, simple, convertible, exchangeable into or for shares of the

company, as well as other fixed income instruments, warrants, and any other

instruments conceding the right to acquire new share issuances, outstanding shares

of the Company or of other companies, with a limit of 1,500 M€. This authorization

includes the delegation of powers necessary, when appropriate, to: (i) determine the

bases and means of conversion, exchange or exercise; (ii) increase capital stock in the

amount necessary to carry out conversion requests; and (iii) exclude pre-emptive

rights for said issuances, limited to a maximum of 20% of the nominal value of capital

stock

PROPOSED RESOLUTION

In accordance with the report drafted by the Board of Directors under the provisions of

Article 286 of the LSC:

Delegate to the Board, in accordance with the general provisions regarding the issuance

of securities and in accordance Articles 297.1 b), 417, and 511 of the LSC, and Article 319

of the Reglamento del Registro Mercantil (“Rules of the Commercial Registry”), the power

to issue tradable securities in accordance under the following conditions:

1. Instruments subject to the Issue

The tradable securities referred to in the present delegation of authority may consist of

bonds or debentures, or simple or convertible or redeemable securities for already issued

Company shares, as well as other fixed income instruments, warrants, or any other

instrument with pre-emptive rights or rights to acquire currently issued shares of the

Company and any other securities or financial instruments tied to Company earnings.

2. Maximum amount of the delegation

It is to be noted that, pursuant to the provisions of the LSC, the Company is not subject to

a legal limit on the issuance of these debentures. Nonetheless, the maximum total

amount for any issue or issues of securities as described above which may be made under

the authority of the present delegation to the Board is to be voluntarily fixed at 1,500

million euros or its equivalent in another currency at the time of its issue.

For the purposes of calculating the above referenced limit, in the event that the warrants

include premiums or fees for their exercise, such amounts will be included.

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3. Period

Issuance of the securities which are the subject of this authorization will take place in

one or more tranches during a period of no longer than five years beginning on the date

of adoption of this resolution.

4. Scope

For illustrative purposes only, the Board will receive the following authority which, in the

event of issuance of convertible and/or redeemable debentures, will be exercised in

accordance with standards later approved following the provisions of Article 414 of the

LSC:

a) To agree to the issuance of debentures in one or more tranches and to

determine the price of each issue setting: the date or dates of issue; the

number of securities and their par value which, in the event of

convertible securities will not be less than the par value of shares at the

time of issue; the rate of interest, dates and payment procedures for

coupons; the time and conditions for redemption and their expiry date;

subordination terms, if any; redemption rates, premiums and lot sizes;

guarantees; the manner to be recorded using titles or book entries; anti-

dilution clauses; the maximum amount per subscriber; the place and time

for subscription; pre-emptive rights; and, generally, any other condition of

issuance as well as procedures for surrender or redemption of the

securities.

b) To decide not to make any issue by not exercising its authority. Upon

expiration of the time established for the issuance of securities, whether

fixed income, convertible, redeemable or not, should the Board not make

use of its authority, such shall be considered expired and have no effect

whatsoever.

c) In the case of convertible and/redeemable securities, determine if they

will be voluntary or forced, and to determine in either event the timing

and conversion period for the issuance, which may not exceed the expiry

date for the issued security, as well as determine whether the conversion

and/or redemption is to be done by delivery of shares or synthetic

instruments or derivatives, with the attendant right to underwrite

derivatives when appropriate.

d) In the case of warrants and analogous securities which give rise to

subscription or acquisition rights in shares, fix the issuance price and/or

premium, the strike price -- which may be fixed, determinable or variable -

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- and the procedure, conversion period and other applicable terms for

exercise of the acquisition or subscription rights of the underlying

securities.

e) Determine subscription terms, priority of securities and any subordination

clauses and the law to be applied to the issuance.

f) Request, when appropriate, permission to trade any issued securities in

foreign or domestic secondary markets under the terms and conditions of

applicable rules and, in general, any other condition for their issuance.

g) Make early redemption of any convertible or redeemable issue or issues.

h) Extend the registration period open to third parties before said period

expires or reduce the volume of the issue to the amount subscribed upon

close of said period.

i) Authorize, when appropriate, the creation of a defence association or

bondholder syndicate and appointment of a trustee in accordance with

the provisions of Article 403 et seq. of the LSC and with applicable law.

j) Set the foundational rules to apply to the legal relationship between the

Company and the bondholder syndicate or syndicates created in

accordance with the provisions of the LSC and applicable law.

k) Modify the terms and conditions of the issues when considered

appropriate and subject to obtaining any necessary permission and

agreement of the corresponding bondholder syndicates or at their

meetings, as the case may be.

l) Correct, clarify, interpret, specify or supplement any resolutions adopted

at the Annual Shareholders’ Meeting or those contained in any filings or

documents produced as a result and, in particular, any defects, errors or

omissions, whether of style or of substance, which might impair giving

full effect to those resolutions at the Registro Mercantil, Registros

Oficiales de la Comisión Nacional del Mercado de Valores or any other

place.

m) Edit and publish any prospectus that it deems necessary.

5. Conditions and ratios for conversion and/or redemption.

As regards determining the conditions and ratios for conversion and/or redemption, the

resolution establishes the following criteria:

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(i) The securities issued under the authority of this resolution may be convertible and/or

redeemable for Company stock at a fixed or variable conversion or redemption

rate, at a fixed or determinable strike price, it being up to the discretion of the

Board to determine if they are convertible or redeemable, as well as to determine

whether conversion or redemption be forced or voluntary, at the discretion of the

issuer, subject to general conditions or those of specific application and, in the

event that they be voluntary at the option of the bondholder or of Indra Sistemas,

S.A., or in the occurrence of some event or condition, the frequency and period

established upon issuance, which may not exceed fifteen (15) years from the date

of issue.

(ii) The Board may also establish, in the event that the issue be convertible or

redeemable, that the issuer reserve the right to choose between conversion to

new shares or exchange for outstanding shares of Indra Sistemas, S.A., fixing the

type of shares to be delivered at the time that said conversion or redemption

takes place, including also the right to choose to deliver a mix of new and

outstanding shares of Indra Sistemas, S.A., settlement through payment of the

difference in value in cash, and including making the redemption through

derivatives or synthetic instruments, in which case the Board may underwrite

derivatives which may be necessary or convenient in order to hedge any risks

arising out of the transaction. In any event, the issuer is to treat equally all

convertible and/or redeemable fixed income securities holders on any given date.

(iii) For the purposes of conversion and/or redemption, the securities will be valued at par

and Company shares will be have a fixed or determinable price set at the time of

issue as a function of the listed value of Indra Sistemas, S.A. shares on the Bolsa

on the date(s) and during the period(s) set in the issue documents, with or without

a discount or premium, it being up to the discretion of the Board to decide the

conversion and/or redemption criteria which it deems appropriate.

The Board may also decide to issue convertible and/or redeemable fixed income securities

with a variable conversion and/or redemption rate. In these cases, the share price

of Indra Sistemas, S.A. for the purposes of conversion and/or redemption will be

determined by the Board, which may include a premium or a discount in the share

price resulting from the established criteria. The premium or discount may be

different for each conversion and/or redemption date for each issue and, when

applicable, for each tranche.

(iv) Upon conversion or redemption, fractional shares due to a bondholder will be rounded

down to the nearest whole number by default, and each bondholder will receive

the difference in cash between the value of the number of shares to be received

in accordance with the issue and the actual number received.

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(v) Under no circumstances shall the price of shares upon conversion be less than par.

Also, in accordance with the provisions of Article 415 of the LSC, no bonds may be

convertible into shares when their par value is below the share par value.

At the time of approval of an issue of convertible bonds pursuant to the authority

contained in this resolution, the Board will issue an administrators’ report

describing in detail and in accordance with the above described criteria, the

conditions and ratios for conversion specifically applicable to the subject issue. An

auditor who is not the auditor for Indra Sistemas, S.A., named for this purpose by

the Registro Mercantil, will also issue a report in accordance with the provisions of

Article 414 of the LSC, and both documents will be made available as soon as the

issue has been agreed by the Board of Directors.

6. Conditions and ratios for exercising warrants and other analogous securities.

In the event that warrants and other analogous securities which give rise to subscription

or acquisition rights to Company shares are issued, because of their atypical nature, the

provisions of the LSC as they relate to convertible bonds will be applied by analogy. As

regards the conditions and ratios for their exercise, the Board will be empowered to

determine, in the broadest possible terms, the criteria applicable for acquisition or

subscription right conferred by securities of this type issued under the authority of the

power so delegated and applying to them the criteria established in section 5 above,

making any changes necessary in order to make them compatible with the specific

characteristics of this type of security.

7. Exclusion of pre-emption rights and increase in capital.

This delegation to the Board also includes, by illustration, but is not limited to

delegation of the following:

(i) Authority of the Board, pursuant to the provisions of Article 511 of the LSC as it relates

to Article 417 of the same statute to waive, totally or partially, pre-emptive rights of

Shareholders. In any case, the Board may decide to suspend pre-emptive rights for

Shareholders regarding specific issuances of convertible bonds or securities, warrants

and other similar instruments which it may decide to issue under the power vested in it

by this resolution, drafting, at the time that said issuance is approved and in accordance

with applicable law, a report detailing the specific corporate best interests which justify

said suspension, which shall also be the subject of a concurrent report from an

independent expert who is not the auditor of the Company financial statements, named

by the Registro Mercantil and referenced in Articles 414, 417 and 511 of the LSC. Said

reports shall be published on the Company website as soon as the terms of issuance

have been decided.

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This authority shall in all instances be limited to those capital increases brought about

under the terms of this authorization and which meet the objectives of Item Seven of

the Agenda for the Annual Shareholders’ Meeting and up to an aggregate limit of 20%

of the capital stock of the Company at the time the resolution is adopted.

(ii) The power to increase capital in the amount necessary to meet demand for conversion

and/or the exercise of pre-emptive rights in shares.

This power may be exercised only so long as the Board, does not exceed the limit of one

half of the company capital stock as provided for in Article 297.1 b) of the LSC, when

adding together the capital increase made necessary to bring about the issuance of

convertible securities or those which give rise to share subscription rights, and all other

increases in capital agreed upon in accordance with the power vested to it at this

Annual Shareholders’ Meeting. This authorization for increase in capital includes that of

issuing and placing into circulation, in one or more tranches, the number of shares

necessary in order to bring about such conversion and/or exercise of subscription rights

in shares, as well as the power to amend the article of the Bylaws related to the amount

of capital stock and, if necessary, rescind the part of any said capital increase made

unnecessary for conversion and/or exercise of subscription rights.

(iii) The power to create and establish the conditions and ratios for conversion, redemption

and/or exercise of subscription right and/or the acquisition of shares arising from the

issued securities, taking into account the criteria established in the sections above.

(iv) The delegation to the Board includes the broadest possible powers under law which

may be necessary for the interpretation, application, execution and promotion of the

issuances of securities convertible or redeemable for shares in Indra Sistemas, S.A., in

one or more tranches, and the corresponding increase in capital, if any, vesting as well

powers to correct and supplement the same in all manners that may be appropriate, as

well as becoming compliant with those legal requirements necessary to bring them

about, and including the power to correct omissions or mistakes in said agreements

which may be pointed out by any domestic or foreign authority, civil servant or body,

vesting as well the power to adopt any and all agreements and deliver whatever public

and private documents it considers necessary or convenient in order to carry out prior

issuances of convertible or redeemable securities and the corresponding increase in

capital under written or oral instructions from the Registro Mercantil or, generally, any

other competent foreign or domestic authority, civil servant, or institution.

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8. Permission to trade.

Indra Sistemas, S.A. may apply, when appropriate, for permission to trade shares issued by

Indra Sistemas, S.A. pursuant to this authority on domestic or foreign secondary markets

granting the Board to the maximum extent permitted by law to fulfill such requirements

and perform such acts necessary for listing before the competent bodies of the various

domestic and foreign exchanges.

It is expressly noted that in the event that a request to delist is made at a later date, that

it will be done following the same formalities as the request for listing, to the extent that

such are applicable and, in such an event, the interests of Shareholders and bondholders

who abstain or vote against such measure will be guaranteed in accordance with

applicable law. Also, it is expressly stated that Indra Sistemas, S.A. submits itself to

existing and future rules regarding the Bolsa, especially those related to trading, listing

and delisting.

9. Power to sub-delegate.

The Board of Directors is expressly authorized by these presents to delegate, under the

provisions of Article 249 bis section L) of the LSC, the power to develop, complete,

implement, interpret and correct capital stock increases referred to this agreement.

The current delegation of authority will render null and void any unused portion of that

authority granted at the Meeting held 21 June 2012.

Additional Documents: the report drafted by the Board of Directors in accordance with

Article 286 of the LSC justifying the proposal made for this Agenda Item will be made

available to Shareholders upon call to order at the corporate website.

44

h. Item 9 of the Agenda- Approval of changes to Articles 31 and 31 bis of the

Bylaws

9.1 Approval of amendment to Article 31 of the Bylaws regarding the Audit and

Compliance Committee.

PROPOSED RESOLUTION

“Amend Article 31 of the Bylaws regarding the Audit and Compliance Committee, the new text of which shall read as follows:

‘Article 31. - The Board of Directors will appoint an Audit and Compliance Committee from its membership. All the members of the Audit and Compliance Committee must be non-Executive Directors of the Company and the majority of them must be Independent Directors.

Subject always to applicable law, rules regarding this Committee will be found within the Board Rules, treating such matters as its composition, technical knowledge of its members, duties, powers and rules of procedure, with a bias towards maintaining independence in the performance of its duties.’” 9.2 Approval of amendment to Article 31 bis of the Bylaws regarding the

Nomination, Compensation and Corporate Governance Committee.

PROPOSED RESOLUTION

“Amend Article 31 bis of the Bylaws regarding the Nomination, Compensation and Corporate Governance Committee, the new text of which shall read as follows:

‘Article 31 bis. - The Board of Directors will appoint a Nomination, Compensation and Corporate Governance Committee from its membership. All the members of the Nomination, Compensation and Corporate Governance Committee must be non-Executive Directors of the Company and the majority of them must be Independent Directors. It will appoint a Chairman among its members, which Chairman must be an Independent Director. Subject always to applicable law, rules regarding this Committee will be found within the Board Rules, treating such matters as its composition, technical knowledge of its members, duties, powers and rules of procedure, with a bias towards maintaining independence in the performance of its duties.

45

The Board may divide the functions of this Committee among two separate

committees.’”

Additional Documents: the report drafted by the Board of Directors in accordance with

Article 286 of the LSC justifying the proposal made for this Agenda Item will be made

available to Shareholders.

46

i. Item 10 of the Agenda. - Consultative Vote on the Annual Report on

Director Compensation.

PROPOSED RESOLUTION

“Consistent with that contained in Article 27.6 of the Board Rules of the Company and in Article 541 of the LSC, the Company has made public the 2015 Annual Report on Director Compensation which was approved by the Board of Directors upon proposal by the Nomination, Compensation and Corporate Governance Committee in its meeting held 17 March, 2015.

Said Report is submitted to the Meeting for voting on a consultative basis.”

REASON FOR THE PROPOSAL

This resolution is to be submitted to a non-binding vote at the Meeting in accordance

with applicable law.

The 2015 Annual Report on Director Compensation faithfully follows the content and

format prescribed by CNMV Circular 7/2015, and was communicated as a relevant event

on 21 April 2016.

Additional Document: The Annual Compensation Report for 2015.

47

j. Item 11 of the Agenda .- Authorization and delegation of powers for

ratification, registry and execution of resolutions passed at the Meeting

PROPOSED RESOLUTION

“Delegate to the Chairman of the Board of Directors, the Vice Chair, the Secretary of the

Board, and the Vice Secretary or any of them the power to certify and publish resolutions

adopted at the present Meeting and in particular the power of interpretation, correction,

execution and completion of them. The power to correct entails making any amendments

and additions which may be necessary or appropriate as a consequence of comments or

demands of securities market regulatory bodies, stock markets, the Registro Mercantil,

and any other public authority with competencies related to the adopted resolutions.”

48

k. Item 12 of the Agenda .- Information regarding changes to the Board Rules

In accordance with the provisions of Article 528 of the LSC and the Board Rules,

participants at this Meeting are informed that, at its meetings held 29 July 2015 and 26

May 2016, the Board of Directors agreed to modify the Board Rules.

At the 29 July 2015 meeting, the Board approved a new text of the Board Rules that

harmonized it with changes made to the LSC by means of Ley 31/2014 of 3 December

and adapted them to the Code of Good Corporate Governance for Listed Companies.

Additionally, stylistic changes were made to some Articles.

At its 26 May 2016 meeting, the Board has approved additional changes to the Board

Rules with the following goals:

- harmonize them with changes made to the LSC by means of Ley 22/2015 of 20 July

regarding Auditing of Accounts (Article 18 of the Board Rules), specifically as regards

knowledge possessed by members of the Audit Committee (Article 18)

- reflect resolutions regarding the creation of an Executive Committee and elimination

of the Strategy Committee (Articles 16 and 17)

- raise to 6 the maximum number of members who may belong to the Audit and

Compliance Committee and to the Nomination, Compensation and Corporate

Governance Committee (Articles 18 and 19)

- insert express mention of the powers possessed by the Nomination, Compensation

and Corporate Governance Committee and which are not expressly provided for by

Law (Article 19).

These last changes will be in force after the Annual Shareholders Meeting. At that

moment they will be communicated to the Spanish Stock Exchange Commission and

registered within the Commercial Registry of Madrid.

The above complies fully with the information required by Article 528 of the LSC.

Additional Document: the current text of the Board Rules will be made available to

Shareholders upon call to order at the corporate website.