Welcome to the Annual General Meeting of Shareholders ...€¦ · Welcome to the Annual General...
Transcript of Welcome to the Annual General Meeting of Shareholders ...€¦ · Welcome to the Annual General...
Local knowledge. Global power. 1
Welcome to the Annual General Meeting of Shareholders AEGON N.V.
Welkom op de jaarlijkse Algemene Vergadering van Aandeelhouders AEGON N.V.
In order to hear a simultaneous translation into English, we would like to offer you the use of a headset. Please, choose channel 4.
Voor het beluisteren van een simultaanvertaling in het Nederlands kunt u gebruikmaken van een koptelefoon. Kies hiervoor kanaal 3.
Local knowledge. Global power. 2
Dudley Eustace
Chairman Supervisory Board
Voorzitter Raad van Commissarissen
Local knowledge. Global power. 3
Agenda item 1 / Agendapunt 1
Opening
Agenda
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Agenda item 2 / Agendapunt 2
Presentation on the course of business andsignificant events in 2008
Presentatie over de gang van zaken enbelangrijke gebeurtenissen in 2008
Agenda
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Course of business and significant events in 2008
Alex Wynaendts, CEO & Chairman of the Executive Board
Local knowledge. Global power. 6
3
1
Strategy update June 2008
2
Reallocate capital towards businesses with higher growth and return prospects
Improve growth and returns from existing businesses
Manage AEGON as an international group
Strategic priorities to improve performance
Local knowledge. Global power. 7
Refocus towards businesses with higher growth and return prospects
* New markets = Central & Eastern Europe, Asia and Latin America
40-50%60%
2007 2008 Targetallocation 2012
New markets*
Western Europe
US
15-25%
40-50%
25-35%
10%
60%
30%
Global businesses5-10%
10%
55%
35%
Capital allocation
Local knowledge. Global power. 8
Global financial turmoil affected the economy
GDP growth expectations for 20091 (EUR million)
-3.0%
-1.0%
1.0%
Jun08
Jul08
Aug08
Sep08
Oct08
Nov08
Dec08
Jan09
Feb09
USEuro zoneUK
100
150
200
250
300
350
1925
1930
1935
1940
1945
1950
1955
1960
1965
1970
1975
1980
1985
1990
1995
2000
2005
2009
Total US credit market debt/GDP3 (%)
1. Source: Consensus Economics Inc. 20082. Bloomberg3. Total US credit market debt measured by the US Federal Reserve includes debt owed by domestic financial services firms, mortgages, corporate debt, federal
government debt, small business debt, consumer debt, state and local government debt, and foreign debt
Credit spread gapping2
Average corporate bond yields (%)
2.0
4.0
6.0
8.0
Dec/02 Dec/03 Dec/04 Dec/05 Dec/06 Dec/07 Dec/08
10 Y TreasuryAAAAABBB
Equity markets2
406080
100120140160180
2003 2004 2005 2006 2007 2008 2009
AEX (Amsterdam)S&P 500
FTSE 100
Indexed level (December 31, 2002=100)
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Maintainingstrong capital
bufferremains key
Strong capital buffer required
o Demand for guarantees
o Trust
Customers
Regulators
o Focus on capitalo Take a more
conservative stance
Fungibility of capital restricted
Financial marketso Volatilityo Illiquidityo Closed capital
markets
Increased cost of capital & less availability of capital
Increase of required capital
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Execution of strategy under difficult circumstances
CAPITAL
CONTINGENCYCOST
FOCUS
BUSINESS REVIEW
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Capital: EUR 1.7 billion of capital released in 2008
o Active risk reduction and diversification:
– Investment risks– Optimization of asset and liability
management– Securitization– Reinsurance transactions
o Transferring risk through reinsuranceo ViF securitizationo Further improvements ALM
o Sale of risky investments
o Reinsurance of non-life catastrophic risk
Americas United Kingdom
Netherlands
Other countries
EUR 1.7 billion of capital released in 2008 through capital preservation and de-risking measures
Local knowledge. Global power. 12
Americas United Kingdom
Netherlands
Other countries
o Salary freezeo Staff reductions / deferred hiring:
headcount reduction of ~560o Additional savings at various divisions
Cost: planned cost measures of EUR 150 million in 2009
o Return to 2007 cost baseo Restructuring program in the
distribution businesso Reduction in number of contract
serviceso Limited salary increases
o Operational changes to sourcing and ITo Reorganization marketing and customer
services o Headcount reduction of ~110 o Limited salary increaseso Savings in distribution
o Cost containment but room for growth
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~89% of common shares
~11% of common shares
100% of preferred
shares
Contingency: EUR 3 billion additional core capital structure
AEGON N.V.
Public Market Dutch StateVereniging AEGON
Capital facilityEUR 3 billion
Non-voting securitiesEUR 3 billion
EUR
EUR
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o Dutch State representation on AEGON Supervisory Board- Two seats granted- Formal appointment by Annual General Meeting of Shareholders- Membership of Audit, Compensation and Nominating Committees
o State representatives approval required on certain decisions
o AEGON maintains full discretion to determine dividend on common shares
Contingency: EUR 3 billion additional core capital structure
Local knowledge. Global power. 15
Business review: continuous assessment of business mix
Measures taken in line with long term strategy
o Sale of real estate brokerage
US Netherlands
o New organizational structureo Downsizing of institutional spread
based balances in the USo Closing down of car credit insuranceo Merger of broker-dealers
o Strategic refocus of Canadian business
Canada
Local knowledge. Global power. 16
Despite market turmoil continued focus on execution of strategy
o Enhanced position in pension markets Hungary and Poland
o First step in fast-developing Turkish life insurance and pension market
o Expanded footprint in Latin America with Brazilian life insurance joint venture
o Presence in Spanish bank distribution channel extended
o Continued roll-out across highly developed coastal provinces and new asset management joint venture in China
o Launch of India life insurance and pension business
Local knowledge. Global power. 17
Remuneration
Alex Wynaendts, CEO & Chairman of the Executive Board
Leo van Wijk, Chairman Compensation Committee of the Supervisory Board
Local knowledge. Global power. 18
Remuneration AEGON
o Salary freeze for senior management (except for CAO increase in The Netherlands)
o Cancellation of worldwide stock option program for all employees, including management
o 2008 total variable compensation ~30% below 2007 levels (EUR 75 mln vs. EUR 105 mln)
o Variable remuneration of senior management restrained as much as possible in 2009 until a new remuneration policy is in place
o New remuneration policy to be implemented for senior management in 2010, in line with new Executive Board policy
Local knowledge. Global power. 19
Remuneration AEGON Executive Board
o No variable compensation over the year 2008
o No increase of fixed base salaries in 2009
o No variable compensation over the year 2009
o Severance payments limited to 1 year fixed base salary
o Development of new remuneration policy, to be submitted to the AGM in 2010
o Base salary Jan Nooitgedagt EUR 700,000 gross per year
o No sign-on bonuso Defined contribution pension plan to which
AEGON will contribute 25% of fixed salary
Local knowledge. Global power. 20
Agenda item 2 / Agendapunt 2
Presentation on the course of business andsignificant events in 2008
Presentatie over de gang van zaken enbelangrijke gebeurtenissen in 2008
Agenda
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Agenda item 3 / Agendapunt 3
Annual Report 2008 and Annual Accounts 2008:Proposal to adopt the Annual Accounts 2008
Jaarverslag 2008 en Jaarrekening 2008:Voorstel tot vaststelling van de Jaarrekening 2008
Agenda
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Full year 2008 results
Jos Streppel, Chief Financial Officer
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Strong capital position
EUR 2.9 billion
S&P risk-based insurance capital model excess capital in operating units above AA level and holding
December 31, 2007
EUR 1.6 billion
December 31, 2008
EUR 5.6 billion (183%)
Insurance Group Directive (IGD) surplus capital*
EUR 6.7 billion (190%)
AEGON’s IGD ratio of 183% compares well with the average for European peers of 144%**
* The calculation of the IGD (Insurance Group Directive) capital surplus and ratio have been changed from the disclosure in the previous year to better reflect regulatory solvency requirements of local regulators and are based on Solvency I capital requirements on IFRS for entities within the EU, and local regulatory solvency measurements for non-EU entities. Specifically, required capital for the life insurance companies in the US is calculated as two times the upper end of the Company Action Level range (200%) as applied by the NationalAssociation of Insurance Commissioners in the US.
** Peers include AXA, Aviva, Allianz, CNP, Swiss Life, Prudential plc, Zurich Financial
NAIC RBC ratio 350%336%
Local knowledge. Global power. 24
Core capital primarily impacted by unrealized losses
Dec 31, 07excluding
revaluationreserves
Net income Movements inforeign currency
translationreserves
Dividends andcoupons on
perpetuals (netof tax)
Convertible corecapital securities
Other changes Dec 31, 08excluding
revaluationreserves
Revaluationreserves
Dec 31, 08
Core capital* development 2008(EUR billion)
o Decline in core capital primarily driven by unrealized losses (revaluation reserve)o Widening of credit spreads had a significant impact on unrealized losses o Unrealized bond losses are not a good indication for future credit losses
16.2
AEGON did not reclassify securities from available-for-sale to held-to-maturity
(7.2)3.0 (0.1)
9.1
(0.2) (0.9)(1.1)15.7
* Core capital is the sum of shareholders’ equity and the EUR 3 billion convertible core capital securities issued to Vereniging AEGON and funded by the Dutch State
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Underlying earnings to net income development in 2008 (EUR million)
1,573 (1,619) 35
(1,038)(12) (21)
(1,082)
2008 net loss driven by fair value items and impairments
2008 net income mainly impacted by financial markets:o Underlying earnings affected by reserves strengthening, DPAC* and lower fees o Underperformance of fair value itemso Impairments on structured assets, financial institutions, high yield and equity o Net income also includes an extraordinary tax charge of EUR 490 million
Underlying earnings before tax
Fair value items performance
Gains on investments
Impairment charges
Other charges Income tax Net income
* Deferred policy acquisition costs
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2007 2008 2007 2008
New life salesAmericas(USD million)
o 2008 new life sales down 20% to EUR 2,631 million – In the Americas Boli/Coli* and life reinsurance drove the decline in sales– UK sales held up well due to growth in individual annuities and corporate pension markets– Dutch new life sales declined although retail life sales were resilient
2007 2008
1,276 945 1,183 1,222 260 219
2008 new life sales impacted by market turmoil
New life salesUnited Kingdom(GBP million)
New life salesThe Netherlands(EUR million)
* Bank-owned and corporate-owned life insurance
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2007 2008 2007 2008
o 2008 net deposits of EUR 3.4 billion (+38%)– Continued strong inflows in institutional fee based products, retirement plans in the US– Strong increase in net deposits driven by fixed annuities
o 2008 gross deposits of EUR 40.8 billion (-8%)– Growth of fixed annuities in the US– Other countries higher due to inclusion of asset management JV in China
2007 2008
3,723 3,680 1,567 5,947 755 1,642
Strong deposits drive net inflows
Gross VA* depositsAmericas(USD million)
Gross FA* depositsAmericas(USD million)
Total gross depositsOther countries(EUR million)
* VA = Variable annuities; FA = Fixed annuities
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2007 2008 2007 2008
Value of new businessAmericas(USD million after tax)
o 2008 value of new business down 10% to EUR 837 million– VNB in Americas up 4% due to a rise in fixed annuities sales– Higher VNB in the UK driven by higher margins– Lower VNB in Other countries mainly due to lower sales in Taiwan– VNB in the Netherlands declined whereas the IRR rose to 10.8%
2007 2008
581 604 157 186 51 43
Strong value of new business
Value of new businessUnited Kingdom(GBP million after tax)
Value of new businessThe Netherlands(EUR million after tax)
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Conclusions
o Earnings clearly impacted by financial markets
o Core business remains resilient
o Capital position remains strong
o Cost reductions underway
o Adequate contingencies in place
Weathering the storm
Local knowledge. Global power. 30
Agenda item 3 / Agendapunt 3
Annual Report 2008 and Annual Accounts 2008:Proposal to adopt the Annual Accounts 2008
Jaarverslag 2008 en Jaarrekening 2008:Voorstel tot vaststelling van de Jaarrekening 2008
Agenda
Local knowledge. Global power. 31
Voting procedure / Stemprocedure
Voorafgaand aan de stemming
- Plaats de smartcard aande bovenzijde met degoudkleurige chip naar voren
- Uw naam verschijnt inhet display
Tijdens stemming
- De stemkeuzes verschijnenop het display
- Druk op toets
- 1 = Voor
- 2 = Tegen
- 3 = Onthouding
- Uw stemkeuze verschijntop het display
- Tijdens de stemperiodekunt u uw stem wijzigen
- Uw laatste keuze geldt
Prior to the voting
- Insert the smartcardin the device with the goldenchip facing you
- Your name appears inthe display
During the voting
- The voting options appearon the display
- Press button- 1 = For- 2 = Against- 3 = Abstain
- Your choice appears onthe display
- During the voting youcan change your vote
- Your last choice counts
Local knowledge. Global power. 32
Agenda item 3 / Agendapunt 3
Annual Report 2008 and Annual Accounts 2008:Proposal to adopt the Annual Accounts 2008
Jaarverslag 2008 en Jaarrekening 2008:Voorstel tot vaststelling van de Jaarrekening 2008
Vote / Stemming
Vote on / Stemming over
Local knowledge. Global power. 33
Agenda
Agenda item 4 / Agendapunt 4
Dividend 2008
Dividend over het boekjaar 2008
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o Dividend policy unchanged - based on capital and cash flow positiono No final dividend payment on common shares as part of capital
preservation measures
Dividend of EUR 0.30 per share
Dividend (EUR)
0.240.300.31 0.32
0.550.62
0.300.30
2006 2007 2008Interim dividendFinal dividendFull year dividend
Local knowledge. Global power. 35
Agenda
Agenda item 4 / Agendapunt 4
Dividend 2008
Dividend over het boekjaar 2008
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Agenda
Agenda item 5 / Agendapunt 5
Proposal to release the members of theExecutive Board from liability for their duties
Voorstel tot het verlenen van kwijting aande leden van de Raad van Bestuur
Local knowledge. Global power. 37
Vote / Stemming
Agenda item 5 / Agendapunt 5
Proposal to release the members of theExecutive Board from liability for their duties
Voorstel tot het verlenen van kwijting aande leden van de Raad van Bestuur
Vote on / Stemming over
Local knowledge. Global power. 38
Agenda
Agenda item 6 / Agendapunt 6
Proposal to release the members of theSupervisory Board from liability for their duties
Voorstel tot het verlenen van kwijting aan deleden van de Raad van Commissarissen
Local knowledge. Global power. 39
Vote / Stemming
Vote on / Stemming overAgenda item 6 / Agendapunt 6
Proposal to release the members of theSupervisory Board from liability for their duties
Voorstel tot het verlenen van kwijting aan deleden van de Raad van Commissarissen
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Agenda item 7 / Agendapunt 7
Proposal to appoint the independent auditor
Voorstel tot benoeming van de externe accountant
Agenda
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Vote / Stemming
Vote on / Stemming overAgenda item 7 / Agendapunt 7
Proposal to appoint the independent auditor
Voorstel tot benoeming van de externe accountant
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Agenda item 8 / Agendapunt 8
Proposal to appoint Mr. J.J. Nooitgedagt to the Executive Board
Voorstel tot benoeming van de heer J.J. Nooitgedagt als lid van de Raad van Bestuur
Agenda
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Proposal to appoint / Voorstel tot benoeming
Curriculum vitaeName / Naam Jan NooitgedagtAge / Leeftijd 55Nationality / Nationaliteit DutchShares held in the company /Aantal aandelen in de vennootschap
None
Former occupations / Vorige functies
Various positions at Ernst & Young, including Managing Partner for the Netherlands and Belgium, and member of the Global Managing Group
Membership of other Boards / Andere bestuursfuncties
None
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Agenda item 8 / Agendapunt 8
Proposal to appoint Mr. J.J. Nooitgedagt to the Executive Board
Voorstel tot benoeming van de heer J.J. Nooitgedagt als lid van de Raad van Bestuur
Agenda
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Agenda item 8 / Agendapunt 8
Proposal to appoint Mr. J.J. Nooitgedagt to the Executive Board
Voorstel tot benoeming van de heer J.J. Nooitgedagt als lid van de Raad van Bestuur
Vote / Stemming
Vote on / Stemming over
Local knowledge. Global power. 46
Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. D.G. Eustace to the Supervisory Board
Voorstel tot herbenoeming van de heer D.G. Eustace als lid van de Raad van Commissarissen
Agenda
Local knowledge. Global power. 47
Proposal to reappoint / Voorstel tot herbenoeming
Curriculum vitaeName / Naam Dudley EustaceAge / Leeftijd 73Nationality / Nationaliteit Joint British and CanadianShares held in the company /Aantal aandelen in de vennootschap
None
Main occupation / Hoofdfunctie Non-executive board member of various companiesFormer occupations / Vorige functies
Vice-Chairman and CFO of Royal Philips Electronics N.V.; Chairman of Smith & Nephew plc, London UK
Other memberships / Andere (bestuurs)functies
Member of the European Advisory Council for Rothschilds; Chairman of the Supervisory Board of the Nielsen Company; Member of the Council of the University of Surrey in the United Kingdom
Local knowledge. Global power. 48
Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. D.G. Eustace to the Supervisory Board
Voorstel tot herbenoeming van de heer D.G. Eustace als lid van de Raad van Commissarissen
Agenda
Local knowledge. Global power. 49
Agenda item 9 / Agendapunt 9
Proposal to reappoint Mr. D.G. Eustace to the Supervisory Board
Voorstel tot herbenoeming van de heer D.G. Eustace als lid van de Raad van Commissarissen
Vote / Stemming
Vote on / Stemming over
Local knowledge. Global power. 50
Agenda
Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. S. Levy to the Supervisory Board
Voorstel tot herbenoeming van de heer S. Levy als lid van de Raad van Commissarissen
Local knowledge. Global power. 51
Proposal to reappoint / Voorstel tot herbenoeming
Curriculum vitaeName / Naam Shemaya LevyAge / Leeftijd 61Nationality / Nationaliteit FrenchShares held in the company /Aantal aandelen in de vennootschap
None
Main occupation / Hoofdfunctie Non-executive director of Nissan Motor Company, Renault Spain and Safran
Former occupation / Vorige functie
Executive Vice-President and CFO of Renault Group
Membership of other Boards / Andere bestuursfuncties
Member of the Supervisory Boards of SegulaTechnologies Group and TNT N.V.
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Agenda
Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. S. Levy to the Supervisory Board
Voorstel tot herbenoeming van de heer S. Levy als lid van de Raad van Commissarissen
Local knowledge. Global power. 53
Agenda item 10 / Agendapunt 10
Proposal to reappoint Mr. S. Levy to the Supervisory Board
Voorstel tot herbenoeming van de heer S. Levy als lid van de Raad van Commissarissen
Vote / Stemming
Vote on / Stemming over
Local knowledge. Global power. 54
Agenda item 11 / Agendapunt 11
Proposal to appoint Mr. A.W.H. Docters van Leeuwen to the Supervisory Board
Voorstel tot benoeming van de heer A.W.H. Docters van Leeuwenals lid van de Raad van Commissarissen
Agenda
Local knowledge. Global power. 55
Proposal to appoint / Voorstel tot benoeming
Curriculum vitaeName / Naam Arthur Docters van LeeuwenAge / Leeftijd 63Nationality / Nationaliteit DutchShares held in the company /Aantal aandelen in de vennootschap
None
Main occupation / Hoofdfunctie Chairman of Holland Financial Centre(until May 1, 2009)
Former occupation / Vorige functie
Chairman of the Netherlands Authority for the Financial Markets (AFM); Chairman of the Board of Procurators-General of the Netherlands; Director-General of the Security Service of the Netherlands
Membership of other Boards / Andere bestuursfuncties
Chairman of the Advisory Board of MeesmanInvestments B.V.; Chairman of the Advisory Board of Independent Risk Solutions; Member of the College of Deans Avicenna Academy for Leadership; Senior Research Fellow at Netherlands School for Public Administration
Local knowledge. Global power. 56
Agenda item 11 / Agendapunt 11
Proposal to appoint Mr. A.W.H. Docters van Leeuwen to the Supervisory Board
Voorstel tot benoeming van de heer A.W.H. Docters van Leeuwen als lid van de Raad van Commissarissen
Agenda
Local knowledge. Global power. 57
Agenda item 11 / Agendapunt 11
Proposal to appoint Mr. A.W.H. Docters van Leeuwen to the Supervisory Board
Voorstel tot benoeming van de heer A.W.H. Docters van Leeuwenals lid van de Raad van Commissarissen
Vote / Stemming
Vote on / Stemming over
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Agenda item 12 / Agendapunt 12
Proposal to authorize the Executive Board to issue common shares
Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen
Agenda
Local knowledge. Global power. 59
Agenda item 12 / Agendapunt 12
Proposal to authorize the Executive Board to issue common shares
Voorstel tot machtiging van de Raad van Bestuur tot uitgifte van gewone aandelen
Vote / Stemming
Vote on / Stemming over
Local knowledge. Global power. 60
Agenda item 13 / Agendapunt 13
Proposal to authorize the Executive Board to restrict or exclude pre-emptive rights upon issuing common shares
Voorstel tot machtiging van de Raad van Bestuur tot beperking of uitsluiting van voorkeursrechten bij de uitgifte
van gewone aandelen
Agenda
Local knowledge. Global power. 61
Vote / Stemming
Vote on / Stemming overAgenda item 13 / Agendapunt 13
Proposal to authorize the Executive Board to restrict or exclude pre-emptive rights upon issuing common shares
Voorstel tot machtiging van de Raad van Bestuur tot beperking of uitsluiting van voorkeursrechten bij de uitgifte
van gewone aandelen
Local knowledge. Global power. 62
Agenda
Agenda item 14 / Agendapunt 14
Proposal to authorize the Executive Board to acquire shares in the Company
Voorstel tot machtiging van de Raad van Bestuur tot verkrijging vaneigen aandelen door de Vennootschap
Local knowledge. Global power. 63
Vote / Stemming
Vote on / Stemming overAgenda item 14 / Agendapunt 14
Proposal to authorize the Executive Board to acquire shares in the Company
Voorstel tot machtiging van de Raad van Bestuur tot verkrijging vaneigen aandelen door de Vennootschap
Local knowledge. Global power. 64
Agenda
Agenda item 15 / Agendapunt 15
i. Retirement of Mr. W.F.C. Stevens as a member of the Supervisory Board
ii. Retirement of Mr. J.B.M. Streppel as a member of the Executive Board
i. Aftreden van de heer W.F.C. Stevens als lid van de Raad van Commissarissen
ii. Aftreden van de heer J.B.M. Streppel als lid van de Raad van Bestuur
Local knowledge. Global power. 65
Agenda
Agenda item 16 / Agendapunt 16
Any other business
Wat verder ter tafel komt
Local knowledge. Global power. 66
Agenda
Agenda item 17 / Agendapunt 17
Close of the meeting
Sluiting
Local knowledge. Global power.
Thank you
Dank u wel