02. PRISA, A GLOBAL GROUP ANNUAL REPORT 2011 Directors shall offer their resignations to the Board of Directors and, if deemed appropriate, formally resign in the following cases: a) When they are subject to any of the legally established prohibitions or grounds for disqualification. b) When based on a criminal offense they are indicted in ordinary felony proceedings or have been convicted in a misdemeanor proceeding. c) When they have received a serious reprimand from the Board of Directors for failure to fulfill their obligations as Directors. d) When the reasons for which they were appointed have ceased to exist and, in particular, when an independent director or an owner-director looses his respective status as such. e) When in the course of a year they fail to attend more than three meetings of the Board of Directors without just cause. f) When their remaining on the Board is deemed inappropriate, under the terms of Article 31.5 of the Board Regulations, and may directly, indirectly or through third parties associated with the Board Member, imperil the loyal and diligent exercise of his or her functions with regards to company interests. Under the terms of the aforementioned Article 31.5, in all those situations where there exists a conflict of interests, or one may be reasonably be expected to exist, and this is deemed to constitute a structural and permanent conflict between the Board Member (or between an associate, or in the case of a director representing controlling shareholders, a shareholder who proposed his or her appointment, or any other party directly or indirectly related to him or her) and with the Company or Group companies, said Member will be deemed to have failed to fulfill the duties inherent in his or her post. The Board of Directors shall not propose the removal of any independent director before completing the term of office set forth in the bylaws for which he was 26 appointed, unless the Board deems that there is just cause for doing so and after seeking the opinion of the Corporate Governance, Appointments and Remuneration Committee. In that regard, just cause shall be deemed to exist when the director has failed to fulfill the duties inherent in his post. Committee members shall leave their posts when they cease to be directors. Evaluation of the performance and composition of the Board of Directors Evaluation of the performance and composition of the Board of Directors is approved by the Board, after a report from the Corporate Governance, Appointments and Remuneration Committee (articles 5.3X and 25 of the Board Regulations). Information The company’s Annual Corporate Governance Report (ACGR) provides detailed information on the shares held by the board members in the company, the posts they hold in the different PRISA companies, as well as posts and stakes held in other companies, analogous or complementary to the Group’s mission. The ACGR also provides information on the Board members’ overall remuneration and the source of this. Transparency Formal and transparent policy regarding the remuneration of company directors Remuneration Policy The Board of Directors and the Corporate Governance, Appointments and Remuneration Committee approves the annual remuneration policy of the Board of Directors and the Management team. Remuneration policy, integrated within the Management Report accompanying the annual accounts, will be subject to approval at the General Shareholders’ Meeting. The Annual Corporate Governance Report will provide information regarding the remuneration of executives and the management team. Furthermore, the Company complies with Article 260 of the LSA