Section two. Governing organs and administration of the Foundation

5.1.-Composition:

5.1.1.- A Board of Trustees is established as the governing body representing the Foundation and made up of a minimum of four Trustees and a maximum of ten, of whom one is the President and Founder D. Enrique Montoliu Romero and the rest are spokespersons. One of these spokepersons will act as Secretary.

5.1.2.- The members of the Board of Trustees will be people who commit themselves in an irrefutable way to the objectives of the Foundation and the duration of their post will be six years, renewable for equal periods. The appointment of the Trustees and, if it arises, their renewal, will be carried out according to the Statutes and in accordance with that set out in the laws of the judiciary.

5.1.3.- The role of Trustee is unpaid, notwithstanding the right to repayment or reimbursement which each Trustee has in respect of justifiable expenses which may be incurred in the performance of tasks related to their role.

5.1.4.- Under no circumstances can more than two members of the Board of Trustees belong to the same institution, public or private entity, or the same family up to the third grade of kinship.

5.2.- Functions and responsibilities of the Board of Trustees:

5.2.1.- The Board of Trustees is established as the highest governing body of the Foundation and its function is to promote the interventions necessary for the Foundation's aims to be achieved and so that the assets and rights which make up the Foundation are administered in a way which maintains fully the efficiency and the usefulness of the same.

5.2.2.- The Trustees are obliged to faithfully accomplish the aims of the Foundation in accordance with that laid down in the Law and Statutes of the Foundation, to take up an appointment in at least one of the Foundation's areas of work, to attend the Board of Trustees meetings and to safeguard the compliance and legality of agreements, as well as avoid as far as possible and within the law, the dissolution of the Foundation in order to preserve its aims and assets.

5.2.3.- The responsibilities of the Board of Trustees for the achievement of the said aims are the following:

a) To approve the budget for each financial year and any modifications as well as the operative objectives and intervention plans.

b) To prepare and approve the accounts and documents as laid out in article 16 of these Statutes.

c) To approve any modifications to the Statutes, within the terms and limits foreseen in the applicable law.

d) To approve any merger with another or other Foundations, within the terms and limits foreseen in the applicable law. For any merger agreement to be valid, it is necessary to have the vote of at least half plus one of all of the members of the Board of Trustees.

e) To adopt agreements on the expiry and liquidisation of the Foundation, within the terms and limits foreseen in the applicable law. For the validity of agreements relating to this point, it is necessary to have the vote of at least half plus one of all of the members of the Board of Trustees.

f) To adopt agreements on the transfer of title, encumbrance, agreements and arbitration on the assets and rights of the Foundation in accordance with the applicable law and the authorisation of the Protectorado de Fundaciones, when appropriate, executing the necessary communication.

g) To accept inheritances, legacies and donations.

h) To acquire assets and rights.

i) To appoint the Foundation's Secretary, the accountant and, in this case, the director or administrator-manager of the Foundation, at the proposal of the President.

j) To appoint the Trustees to fill the vacancies on the Board of Trustees, as well as the nomination of the President, always and in both cases at the proposal of the President.

k) To approve, at the proposal of the President, the personnel and the organisation chart of the Foundation, fixing the remuneration of each post.

l) To approve, at the proposal of the president, the regulations and rulings for an efficient governing and internal system of the Fundation and to resolve any questions that arise over the interpretation of the regulations and rulings which develop them.

m) To approve the establishment and concession of prizes, grants for research, as well as work programmes.

n) To approve extraordinary activities which could alter the contents of the annual budget.

ñ) To delegate to some of the Trustees or to the President himself the functions which are specifically determined.

o) All those functions and actions directed at the most efficient governing and administration of the Foundation and at the exact execution of its aims.

5.3.- Functions and responsibilities of the President.

5.3.1.- The President is the sole authority who holds and carries out with the maximum of dignity the representation of the Foundation before all classes of people and private and public entities; he convenes the ordinary and extraordinary meetings of the Board of Trustees, setting the agenda, presiding over the meeting and managing the discussions; he implements the agreements made by the Board of Trustees and ensures they are carried out, to do so he can carry out all kinds of acts and sign any necessary documents to this end; he ensures that the assets and rights that make up the patrimony of the Foundation are managed correctly, fully maintaining the efficiency and the usefulness of the same in accordance with the financial and economic criteria of a good director.

5.3.2.- In addition, the President can execute by delegation, if the Board of Trustees is in agreement, the functions which these Statutes assign to the Board of Trustees itself, except for the following:

1º. The contents of sections a), b), c), d), e), f), y ñ) of point 2 of this Article 5.

2º. Those which require the authorisation of the Protectorado.

5.3.3.- The President of the Board of Trustees is also responsible for convening, presiding over and closing the sessions held by the complementary bodies of the Foundation as well as managing their discussions, having the casting vote when decisions are tied during discussions.

5.3.4.- The Jardín de l’Albarda forms part of the assets of the Foundation and is the symbol of the objectives of the Foundation. The house which forms part of it is and will be the institutional residence of whoever occupies the role of President of the Foundation, and it must be preserved with the diligence and dignity attached to the social representation that it implies and in the same conditions in which the President Founder maintains it.

5.4.- Term of office, replacement, cessation, suspension, obligations and rights of the members of the Board of Trustees:

5.4.1.- Of the President

5.4.1.1.- The duration of the term of office of the Trustee-President is indefinite.

5.4.1.2.- The term of office of successive Presidents will be indefinite with those limitations laid out in sections 7.2.3 y 7.3.3 of these Statutes.

5.4.2.- Of the remaining Trustees

5.4.2.1.- The term of office for the Trustees will be for six years with the possibility of being re-elected for terms of similar duration.

5.4.2.2.- The Trustees will take up their posts after having expressly accepted the post in one of the ways laid out in Article 13 of Ley 8/1998, dated 8th December, for Fundaciones de la Comunidad Valenciana.

5.4.2.3.- When more than two Trustees are to be substituted simultaneously, and in order to guarantee the continuity and efficient functioning of the Foundation, a draw will be held, if the Trustees affected have expressed their wish to remain in their post, to determine which Trustee or Trustees will have their term of office extended for one more year, in such a way that succession does not affect more than two Trustees at the same time.

5.4.2.4.- The appointment of new Trustees will be agreed by the Board of Trustees, on the proposal of the President-Founder and, where appropriate, by successive Presidents, from among persons of legal age, with full legal capacity and who prove that they do not hold managerial posts in any political, trade union or religious organisations.

5.4.2.5.- All Trustees are obliged to take up a role in at least one of the areas of work created by the Board of Trustees on the `proposal of the President, in accordance with the needs of the Foundation. At each meeting of the Board of Trustees, each trustee must inform of the responsibilities he has taken up as well as results achieved. Only in exceptional and duly justified circumstances can the Board of Trustees exempt a Trustee from this obligation.

5.4.2.6.- Cessation: The cessation of the Trustees of the Foundation will happen under the following circumstances:

a) Because of the death, or the declaration of the death, as well as the expiry of the judicial person.

b) Because of their incapacity, disqualification or incompatibility in accordance with that laid down by Law.

c) Because of the cessation of the post for which they were named as member of the Board of Trustees.

d) For not carrying our their role with the diligence of a loyal representative, if a judicial sentence determines this to be the case.

e) By a judicial resolution which admits the action of responsibility because of damage or harm caused by acts contrary to the Law or the Statutes or those carried out negligently.

f) Because of the passing of the period of their term of office with those exceptions laid out in these Statutes .

g) By resignation expressed in any of the ways detailed in the current legislation.

h) By accepting managerial roles in political, trade union or religious rganisations.

i) By cessation agreed by a qualified majority of the Board of Trustees, in which case it must be caused, justified and be in response to the following causes:

ii.- Continued or unjustified non-attendance at more than three sessions of the Board of Trustees.

In any of the cases detailed in this section, the Trustee affected will have the right to be heard by the Board of Trustees before the adoption of the agreement of cessation.

5.4.2.7.- Suspension: The suspension of the Trustees can be agreed provisionally by the Judge when the action of responsibility is filed against them.

5.4.2.8.- The replacement, cessation and suspension of Trustees will be written in the Registro de Fundaciones.

5.4.2.9.- Obligations of the Trustees: the obligations of the Trustees are:

a) To attend the sessions convened.

b) To carry our their role personally, to involve themselves in at least one of the areas of work of the Foundation, fulfilling diligently the obligations assumed and keeping the Board of Trustees informed when necessary.

c) To maintain discretion on matters which they know as a consequence of the carrying out of their role, except with the express authorisation of the Board of Trustees.

d) To inform the President of any change of address and absences longer than two months.

e) When a trustee cannot attend a meeting for justified reasons, he can delegate his vote to another member of the Board of Trustees. This delegation of his vote cannot be exercised in the case of the appointment of new Trustees.

5.4.2.10.- Rights of the Trustees: the Trustees will have the right to:

a) Receive the notification of the meetings of the Board of Trustees at least seven days in advance.

b) Receive a copy of the minutes of the meetings of the Board of Trustees.

c) Access the documentation regarding the matters to be discussed at the convened meetings.

d) Suggest proposals to the President for their inclusion in the agenda of the meetings, also ask questions or raise any other business.

e) Receive compensation for any expenses incurred when attending the meetings and others incurred in the carrying out of their reaponsibilities.

f) Visit the property and assets of the Foundation on written request to the President and his acceptance of this, in order to enable coordination of visits.

g) Delegate his vote under the conditions stipulated in these Statutes.

Article 6º-System of meetings.

6.1.- The Board of Trustees will meet in ordinary session at least twice a year, once every six months.

6.2.- In addition, it will meet in extraordinary sessions when convened by the President, on his own initiative, or at the request of the Trustees.

6.3.- The Board of Trustees, when convened, will be considered validly quorate when at least three members are in attendance, in addition to the President. This quorum should remain in force during the whole meeting. The attendance of the President and the Secretary of the Board of Trustees, or their legal substitutions, is always required.

6.4.- If, at the first call, there is not the necessary quorum, according to the guidelines set out in the previous paragraph, the meeting will automatically be reconvened at the same time two days later. If the necessary quorum is still not achieved, the President will cancel the session, postponing the points of the agenda until the next subsequent meeting, be it ordinary or extraordinary.

6.5.- In spite of the above, the Board of Trustees will be considered convened and will be validly constituted, without prior summons, whenever all the Trustees are present and accept unanimously the holding of the session, determining the agenda at the beginning of the meeting.

6.6.- The secretary will keep minutes of each session, to include the place, date and time held, the Trustees attending, whether it is an ordinary or extraordinary session, the points to be discussed, the votes cast, specifying who voted for and against, as well as abstentions, and the regulatory part of the agreements adopted.

6.7.- The minutes, once approved by the Board of Trustees, will be written in the Libro de Actas, authorized by the signatures of the President and the Secretary..

6.8.- The agreements reached by the Board of Trustees will be accredited by means of certfication issued and approved by the President, or whoever is the alternative, and by the Secretary.

6.9.- The Board of Trustees will adopt its agreements, as a general rule, by a simple majority of the members present, but with the exceptions detailed in these Statutes and unless the current law demands a qualified majority,

6.10.- Each Trustee has one vote which can be delegated to another member of the Board of Trustees if he is unable to attend a meeting. The delegation will be specified and exclusive to that session, should be formalised in writing and given to the President before the start of the session.

6.11.- In all cases, the President has the casting vote to resolve any draws which arise during voting.

Article 7º.-Substitution of the President

7.1.- Temporary substitution:

The President will establish and communicate to the Board of Trustees annually a substitution order in case of absence, illness or other justified reason preventing him from carrying out his role, so that his role is always carried out to guarantee the efficient functioning of the Foundation.

If after a year a new order of substitutions is not set out, the previous order will be considered extended without the need for any other procedure. ,

7.2.- Resignation of the President - Founder:

7.2.1.- If the President-Founder presents his voluntary resignation from the post of Trustee 1º and President, he can nominate the person to replace him in his post and their term of office will extend up to the death of the Founder, except when the former establishes a shorter or longer period and communicates it irrefutibly to the Board of Trustees.

7.2.2.- In the case of the latter point, the President-Founder can, when he nominates a successor as President, remain on the Board of Trustees of the Foundation, in which case he will become the Trustee-Founder with the same powers as the other Trustees.

7.2.3.- The Presidents who succeed the President-Founder or the President nominated by him in accordance with that laid down in the previous section, can resign from the post without losing the status of Trustee, communicating the request to the Board of Trustees in an infallible manner.

7.3.- Appointment and cessation of the President

7.3.1.- In cases not covered in the previous section, the President can propose to the Board of Trustees the person he considers should succeed him. The agreement of the Board of Trustees should be by absolute majority.

7.3.2.- If the post of President remains vacant without the succession being resolved, the Presidency will be occupied temporarily or for an interim period by the person who has been Trustee for the longest time or, if there are two or three who have been in post for the same time, by the oldest in years. At a maximum of six months the new President will be elected by the members of the Board of Trustees.

7.3.3.- Successive Presidents can be substituted in their post of President of the Board of Trustees on a temporary basis or permanently with the unanimous agreement of all remaining Trustees, when ill health justifies it or as a result of serious deficiencies in his management of his post or serious damage to the statutory aims and objectives of the Foundation. The agreement to substitute or to dismiss him will also imply, necessarily and smultaneously, the apppointment of the new President.

7.3.4.- The Presidents elected will carry out their role for an indefinite period.

Article 8º.-Reinforced majority.

8.1. To adopt agreements on the following subjects it is necessary to have the vote of at least half plus one of the members who make up the Board of Trustees:

a) Modification of the Statutes.

b) Merger of the Foundation with another or others.

c) Adoption of agreements on the expiry or the liquidisation of the Foundation.

d) Transfer of title, encumbrance, agreements and arbitrage of assets and rights of the Foundation which need the authorisation of the Protectorado.

e) Creation and elimination of complementary bodies of the Foundation.

f) Appointment of new Trustees, of the President and of the members of the complementary bodies of the Foundation, as well as their cessation.