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TRANSCRIPT
Annual General Meeting ofAnnual General Meeting of Shareholders AEGON N.V.
The Hague, May 16, 2012
Welcome to the Annual General Meeting of Shareholders
Welkom op de jaarlijkse Algemene Vergadering van Aandeelhouders
In order to hear a simultaneous translation into English,g please choose channel 2
Voor het beluisteren van een simultaanvertaling in het Voor het beluisteren van een simultaanvertaling in het Nederlands kiest u kanaal 1
2
Rob RoutsRob Routs
Chairman Supervisory Board
Voorzitter Raad van CommissarissenVoorzitter Raad van Commissarissen
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Agenda item 1 / Agendapunt 1
OpeningOpening
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Agenda item 2 / Agendapunt 2
Presentation on the course of business in 2011
Presentatie over de gang van zaken in 2011in 2011
5
Transforming AEGONTransforming AEGON
In pursuit of sustainable growthIn pursuit of sustainable growth
Alex Wynaendts CEO & Chairman of the Executive Board
2011: A year of transformation
� Restructuring of AEGON’s operations
� Sharpened focus on core business � Sharpened focus on core business
� Completed repayment to Dutch State
� Strengthening of capital position
A d i i di id d� Announced intention to resume dividend
Transformed AEGON 7
Transformed AEGON
Need to respond to challenges in today’s environment
� Continued volatility financial markets
� New realities for our business � New realities for our business
► Aging populations
► Governments withdrawing
► Customer needs
► Social media
� Enhancing our position for the future
8
g p
Financial markets remain challenging
Interest rates remain historically low(10-year benchmark rates)
Mixed development equity markets(January 2010 = 100; in local currency)
4
4.5
120
130
2.5
3
3.5
90
100
110
1.5
2
70
80
US UK NL S&P 500 FTSE AEX
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Negative economic impact from continuing Euro crisis
... as Euro crisis continues (Sovereign spreads versus 10-year German Bunds)
Mild recession projected for Eurozone ... (Development consensus forecasts GDP 2012)
1600
3
4
1200
1400
1600
2
600
800
1000
0
1
J F M A M J J A S O N D J F M A
2011 2012 200
400
-1
J F M A M J J A S O N D J F M A
US UK Eurozone
Month of forecast
0
Jan/
11
Feb/
11
Mar
/11
Apr
/11
May
/11
Jun/
11
Jul/1
1
Aug
/11
Sep
/11
Oct
/11
Nov
/11
Dec
/11
Jan/
12
Feb/
12
Mar
/12
Apr
/12
Spain Portugal Ireland Italy France
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US UK Eurozone Spain Portugal Ireland Italy France
t
t t
f h i fi i l f
A customer-centric organization
� Connecting with our customers
I i i li biliti� Investing in online capabilities
� Improving service levelsImproving service levels
� Measuring customer satisfaction
� Helping people take responsibility
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for their financial future
Sharing common values…
W ki T th
Working
Working Together
� Fully leverage knowledge and expertise across AEGON Working Together
B i i Cl it
Bringing
Bringing Clarity
� Open and ongoing dialogue with our stakeholders Bringing Clarity
Exceeding expectations
Exceeding
Exceeding expectations
� Excel and being accountable for what we do and how we do it
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Expectations
… to further deliver on AEGON’s strategic priorities
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-
Towards sustainable growth
� Exited businesses deemed no longer corelonger core
� Increase fee-based business; � Increase fee based business; reduce spread business
� Pursue organic growth in CEE, Asia and Latin AmericaAsia and Latin America
� Expand and broaden distribution 14
Expand and broaden distribution
Towards sustainable growth
� Measure customer loyalty consistently Measure customer loyalty consistently
� Understand our customer and chosen customer segments
� Deliver simple and transparent solutions
� Build strong brands and leverage hisponsorships
� Introduced global set of market 15
� Introduced global set of market conduct principles
Towards sustainable growth
� Increase operational efficiency and improve service levels
� Investing in new technology and greater innovationgreater innovation
Ad ti R ibl � Adopting a Responsible Investment Policy
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Towards sustainable growth
� Increased accountability
� Focus on supporting innovation
� First Global Employee SurveyFirst Global Employee Survey
Gl b l T l t R i l h d� Global Talent Review launched
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A more comprehensive view of AEGON’s performance
� First integrated Review and � First integrated Review and Sustainability Report
� Reflects full integration of sustainability issues in business strategy andgyoperations
E plains links bet een� Explains links between: ► Financial performance
Strategy► Strategy ► Governance ► Social economic and environmental context
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► Social, economic and environmental context
Strengthened position to deliver sustainable earnings growth
TransformingTransforming Tomorrow
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Agenda item 2 / Agendapunt 2
Presentation on the course of business in 2011
Presentatie over de gang van zaken in 2011in 2011
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Agenda item 3.1 / Agendapunt 3.1
Annual Report 2011Annual Report 2011
Jaarverslag 2011
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Full year 2011 &Full year 2011 & first quarter 2012 results
Jan Nooitgedagt CFO & Member of the Executive Board
2011 Underlying earnings reflect a year of transformation 1 522 MLN
EUR million � Strategic decisions
2011
1,522 MLN � Lower interest rates
and equity markets 2011 1,522 and equity markets
R d UK 2010 1,833
� Redress program UK
2009 1,129
� Provisioning to account for rising life
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expectancy rates
2011 Net income
872 MLN
EUR million � Lower underlying earnings
2011
872 MLN earnings
� Fewer gains on 2011 872 � Fewer gains on
investments
2010 1,760
� Offset decrease in i t d l
2009 204
income tax and lower impairment charges
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25
Cost savings in 2011 offset by restructuring charges
� Cost savings in line with plans and strategic focus
� Investments in new propositions Distribution initiatives ► Distribution initiatives
► Pension platform UK
� Restructuring charges mainly in NL and UK
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2011 Sales & deposits demonstrate strength of franchise
New life sales Gross deposits New life sales
1 835 MLN
EUR million Gross deposits
32 BLN
EUR billion
2011
1,835 MLN
2011
32 BLN
2011 1,835
2011 32
2010 2,081
2010 33
2009 1,950
2009 28
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Return on equity
6 7%
In % � RoE for ongoing business 7 9%
2011
6.7% business 7.9%
X Higher average 2011 6.7
X Higher average shareholder’s equity
2010 8.6 X Lower underlying
earnings 2009
5.1
earnings
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3 5% 0 % 0 3% 0 % %
Capital base ratio of 74.2% - on target to exceed 75% by end 2012 ExcessCapital Group
IGD US
RBC ratio UK
Pillar I Netherlands
IGD
EUR 1 2
Excess capital in holding
Capital base ratio
195% 453% 149% 195%December 31, 2011 73.5% EUR 1.2 bln
Capital base ratio roll forward
73.5% 0.2% 0.3% 0.2% 74.2%
Q4 2011 Retained Up-streamed Holding Q1 2012
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earnings capital from operating units
and other
► Demonstrating strength of franchise
Q1 2012: sales and earnings increase; strong capital position maintained
� Underlying earnings 3% up to EUR 425 million ► Business growth, cost reductions and favorable markets g ,
� Net income 59% up to EUR 521 million ► Positive fair value items and low impairments
� Total sales 25% up to EUR1 8 billionTotal sales 25% up to EUR1.8 billion
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� Operating expenses reduced by 7%
� Strong capital position and operational free cash flows � Strong capital position and operational free cash flows
( g
Focus on delivering on targets*
Achieve return on equity of Grow underlying earnings before tax by
Double fee-based earnings to Increase annual normalized operational free cash flow to
10-12% by 2015
7-10% on average per annum
30-35% €1.3-1.6 billion
y g p between 2010 and 2015 of underlying earnings by 2015 by 2015
35% Fee-based earnings
€405 million
Normalized operational free cash flow
Underlying earnings before tax
3%
Return on equity
6.9% (7.8% excluding
of Q1 2012 underlying earnings Q1 2012
million Q1 12 compared to Q1 11
run-off capital)
Q1 2012
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* Main economic assumptions embedded in targets: annual gross equity market return of 9%, 10 year US interest rate of 4.75% in 2016 and EUR/USD rate of 1.35.
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Conclusion
� 2011, a year of transformation; positioning for the future
�� Underlying earnings affected by financial markets Underlying earnings affected by financial markets, UK exceptional charges and provisioning for rising life
� Restructuring in the UK finalized; in the Netherlands on track
�� Strong franchise evidenced by resilient sales Strong franchise evidenced by resilient sales
� Capital position remains strong
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May 12th 2011
► The Executive Board policy already complied with DNB requirements
Remuneration policy
� AEGON Global Remuneration Framework introduced throughout � AEGON Global Remuneration Framework introduced throughout AEGON Group to comply with new European regulations for financial institutions
� The Executive Board policy was adopted by the AGM onThe Executive Board policy was adopted by the AGM on
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► The Executive Board policy already complied with DNB requirements, some refinements were implemented
Executive Board remuneration 2011
� Remuneration in 2011 � Remuneration in 2011
► Fixed compensation paid in 2011 increased marginally to reflect cost of living increase awarded to all AEGON staff in The Netherlandsliving increase awarded to all AEGON staff in The Netherlands
► No variable pay has been paid in 2011
� Variable Compensation over 2011
► The Executive Board decided to forego the cash payment payable in 2012
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► The Executive Board decided to forego the cash payment payable in 2012 over AEGON’s 2011 performance year
► Number of shares made available in 2012 is 34,607 and 22,501 for Mr. Wynaendts and Mr. Nooitgedagt respectively
► The remaining part (60%) of variable compensation over the performance fyear 2011 is to be paid out in future years subject to ex-post assessments
–
Executive Board remuneration 2012
� Adjustment of base pay to reflect cost of living increases awarded to all staff of AEGON in the Netherlands in previous years
� Variable compensation based on: ► Financial targets (75%), aligned with 2015 AEGON N.V. targets
• Underlying earnings after tax • Return on equity • Market consistent value of new business
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• Return on economic required capital • Sustainability: AEGON’s score for the Dow Jones Sustainability Index
► Personal targets (25%) ► Personal targets (25%) • Large projects/issues – e.g. EU commitments, Solvency II • Strategy review • HR and Sustainability related subjects e g talent development employee engagement • HR and Sustainability related subjects e.g. talent development, employee engagement
Agenda item 3.1 / Agendapunt 3.1
Annual Report 2011Annual Report 2011
Jaarverslag 2011
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Agenda item 3.2 / Agendapunt 3.2
Annual Accounts 2011: Proposal to adopt the Annual Accounts 2011
Jaarrekening 2011:Jaarrekening 2011: Voorstel tot vaststelling van de
Jaarrekening 2011
36
Voting procedure / Stemprocedure
Prior to the voting: – Insert card with chip facing you
Name appears in display
Vóór de stemming: – Plaats kaart met chip naar voren
Naam verschijnt in venster – Name appears in display
During the voting: – Voting options appear in display
– Naam verschijnt in venster
Tijdens de stemming: – Stemkeuzes verschijnen in venster
– Press button:
1 = For 2 = Against
– Maak uw keuze:
1 = Vóór 2 = Tegen 2 = Against
3 = Abstain
– Choice appears in display
2 = Tegen 3 = Onthouding
– Keuze verschijnt in venster – During voting you can change
your vote – Last choice counts
– Tijdens stemming kunt u uw keuze wijzigen
– Laatste keuze geldt
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Vote on / Stemming over: Agenda item 3.2 / Agendapunt 3.2
Annual Accounts 2011: Proposal to adopt the Annual Accounts 2011
Jaarrekening 2011:Jaarrekening 2011: Voorstel tot vaststelling van de
Jaarrekening 2011
38
Agenda item 4 / Agendapunt 4
Proposal to approve the dividend 2011Proposal to approve the dividend 2011
V t l t t dk i h t di id dVoorstel tot goedkeuring van het dividend over het boekjaar 2011
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AEGON’s dividend policy
� Aiming for a sustainable dividend, which can grow over time if performance of the company allows so
� Cash flows received from operating units are used for holding expenses, including funding costs
� Cash flow after holding expenses available to execute strategy and to fund dividends ► Balance prudence versus offering an attractive dividend ► Local insurance regulations
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Value of stock dividend approximately equal to cash dividend
AEGON’s dividend proposal
� Proposed final dividend for 2011 of EUR 0.10 per common share
� Related to second half of 2011
� To be paid in cash or stockp
� Value of stock dividend approximately equal to cash dividend
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Vote on / Stemming over: Agenda item 4 / Agendapunt 4
Proposal to approve the dividend 2011Proposal to approve the dividend 2011
V t l t t dk i h t di id dVoorstel tot goedkeuring van het dividend over het boekjaar 2011
42
Agenda item 5 / Agendapunt 5
Proposal to release the members of the pExecutive Board from liability for their duties
Voorstel tot het verlenen van kwijting aan de leden van de Raad van Bestuurleden van de Raad van Bestuur
43
Vote on / Stemming over: Agenda item 5 / Agendapunt 5
Proposal to release the members of the pExecutive Board from liability for their duties
Voorstel tot het verlenen van kwijting aan de leden van de Raad van Bestuurleden van de Raad van Bestuur
44
Agenda item 6 / Agendapunt 6
Proposal to release the members of the Supervisory Board from liabilitySupervisory Board from liability
for their duties
Voorstel tot het verlenen van kwijting aan de leden van de Raad van Commissarissenleden van de Raad van Commissarissen
45
Vote on / Stemming over: Agenda item 6 / Agendapunt 6
Proposal to release the members of the Supervisory Board from liabilitySupervisory Board from liability
for their duties
Voorstel tot het verlenen van kwijting aan de leden van de Raad van Commissarissenleden van de Raad van Commissarissen
46
Agenda item 7 / Agendapunt 7
Proposal to appoint the independent auditorProposal to appoint the independent auditor
Voorstel tot benoeming van de externe accountantexterne accountant
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process
Appointment independent auditor
� Proposal to appoint Ernst & Young for 2012 accounts ► Based on recommendation Audit Committee ► Lead audit partner rotated in 2011
� Audit tender process ► Audit for the 2014 accounts will be put to tender ► New legislation to be expected: mandatory audit firm rotation from 2014
or l tlater
� AGM 2013 ► Proposal to appoint external auditor for 2013 accounts ► Proposal to appoint external auditor for 2014 accounts based on outcome
tendertender process
48
Vote on / Stemming over: Agenda item 7 / Agendapunt 7
Proposal to appoint the independent auditorProposal to appoint the independent auditor
Voorstel tot benoeming van de externe accountantexterne accountant
49
Agenda item 8 / Agendapunt 8
Proposal to reappoint Mr. I.W. Bailey, II to thep pp y, Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer I.W. Bailey, II als lid
van de Raad van Commissarissen
50
-
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Irving W. Bailey, II
A 70 Age: 70
Nationality: Americany
Memberships other boards:
- Board of Directors of Computer Sciences CorpBoard of Directors of Computer Sciences Corp. - Board of Directors of Hospira, Inc. Not listedNot listed
- Senior advisor to Chrysalis Ventures, LLC
Agenda item 8 / Agendapunt 8
Proposal to reappoint Mr. I.W. Bailey, II to thep pp y, Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer I.W. Bailey, II als lid
van de Raad van Commissarissen
52
Vote on / Stemming over: Agenda item 8 / Agendapunt 8
Proposal to reappoint Mr. I.W. Bailey, II to thep pp y, Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer I.W. Bailey, II als lid
van de Raad van Commissarissen
53
Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. R.J. Routs to the p pp Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer R.J. Routs als lid
van de Raad van Commissarissen
54
Robert J. Routs
A 65 Age: 65
Nationality: Dutchy
Memberships other boards: - Chairman Supervisory Board DSM N VChairman Supervisory Board DSM N.V. - Vice-chairman Supervisory Board KPN N.V. - Member Board of Directors Canadian Utilities LtdMember Board of Directors Canadian Utilities Ltd. - Member Board of Directors A.P. Møller–Mærsk A/S - Member Board of Directors AECOM Technology Corp.
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Member Board of Directors AECOM Technology Corp.
Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. R.J. Routs to the p pp Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer R.J. Routs als lid
van de Raad van Commissarissen
56
Vote on / Stemming over: Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. R.J. Routs to the p pp Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer R.J. Routs als lid
van de Raad van Commissarissen
57
Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. B. van der Veer to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer B. van der Veer als lid
van de Raad van Commissarissen
58
Member Supervisory Board Siemens Nederland N.V. - Member Supervisory Board FrieslandCampina N.V.
Ben van der Veer
A 61 Age: 61
Nationality: Dutchy
Memberships other boards: - Member Supervisory Board TomTom N.V. - Member Supervisory Board Reed Elsevier N.V. - Non-executive member Board of Directors Reed
El i PLC Elsevier PLC Not listed
Member Supervisory Board Siemens Nederland N V -
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Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. B. van der Veer to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer B. van der Veer als lid
van de Raad van Commissarissen
60
Vote on / Stemming over: Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. B. van der Veer to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer B. van der Veer als lid
van de Raad van Commissarissen
61
Agenda item 11 / Agendapunt 11
Proposal to reappoint Mr. D.P.M. Verbeek to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer D.P.M. Verbeek als lid
van de Raad van Commissarissen
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-
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Member Advisory Board CVC Europe - Member Advisory Board OVG Re/developers
Dirk P.M. Verbeek
A 61 Age: 61
Nationality: Dutchy
Memberships other boards:Memberships other boards: Not listed
Chairman Supervisory Board Robeco Groep N V- Chairman Supervisory Board Robeco Groep N.V. - Member Supervisory Board Aon Groep Nederland B.V. - Advisor to President and CEO of Aon CorporationAdvisor to President and CEO of Aon Corporation - Chairman of Benelux Advisory Board Leonardo & Co. B.V. - Member Advisory Board CVC Europe
Agenda item 11 / Agendapunt 11
Proposal to reappoint Mr. D.P.M. Verbeek to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer D.P.M. Verbeek als lid
van de Raad van Commissarissen
64
Vote on / Stemming over: Agenda item 11 / Agendapunt 11
Proposal to reappoint Mr. D.P.M. Verbeek to p pp the Supervisory Board
Voorstel tot herbenoeming vanVoorstel tot herbenoeming van de heer D.P.M. Verbeek als lid
van de Raad van Commissarissen
65
Agenda item 12 / Agendapunt 12
Proposal to authorize the Executive Board pto issue common shares
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot uitgifte
van gewone aandelen
66
Vote on / Stemming over: Agenda item 12 / Agendapunt 12
Proposal to authorize the Executive Board pto issue common shares
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot uitgifte
van gewone aandelen
67
Agenda item 13 / Agendapunt 13
Proposal to authorize the Executive Board to restrict or exclude pre emptive rights upon to restrict or exclude pre-emptive rights upon
issuing common shares
Voorstel tot machtiging van deg gRaad van Bestuur tot beperking of uitsluiting
van voorkeursrechten bij de uitgifte vanvan voorkeursrechten bij de uitgifte van gewone aandelen
68
Vote on / Stemming over: Agenda item 13 / Agendapunt 13
Proposal to authorize the Executive Board to restrict or exclude pre emptive rights upon to restrict or exclude pre-emptive rights upon
issuing common shares
Voorstel tot machtiging van deg gRaad van Bestuur tot beperking of uitsluiting
van voorkeursrechten bij de uitgifte vanvan voorkeursrechten bij de uitgifte van gewone aandelen
69
Agenda item 14 / Agendapunt 14
Proposal to authorize the Executive Board to issue common shares underto issue common shares under
incentive plans
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone
aandelen in het kader van incentive-plannen
70
Vote on / Stemming over: Agenda item 14 / Agendapunt 14
Proposal to authorize the Executive Board to issue common shares underto issue common shares under
incentive plans
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone
aandelen in het kader van incentive-plannen
71
Agenda item 15 / Agendapunt 15
Proposal to authorize the Executive Board pto acquire shares in the company
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot verkrijging van eigen
aandelen door de vennootschap
72
Vote on / Stemming over: Agenda item 15 / Agendapunt 15
Proposal to authorize the Executive Board pto acquire shares in the company
Voorstel tot machtiging van de Voorstel tot machtiging van de Raad van Bestuur tot verkrijging van eigen
aandelen door de vennootschap
73
Agenda item 16 / Agendapunt 16
Any other businessAny other business
Wat verder ter tafel komt
74
Agenda item 17 / Agendapunt 17
Close of the meetingClose of the meeting
Sluiting van de vergadering
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Thank you Thank you
Dank u welDank u wel
WWW.AEGON.COM
Please return your voting device and voting card before departingvoting card before departing
Wilt u voor uw vertrek uw stemkastje en stempas inleveren
7777