Document:

EXHIBIT 10.3
 

SUBSCRIPTION AGREEMENT

 

THIS SUBSCRIPTION AGREEMENT (this “Agreement”), dated as of November 18,
2005, by and among Force Protection, Inc., a Nevada corporation (the “Company”), and the subscribers identified
on the signature page hereto (each a “Subscriber”
and collectively “Subscribers”).

 

WHEREAS, the Company and the Subscribers are executing and
delivering this Agreement in reliance upon an exemption from securities
registration afforded by the provisions of Section 4(2) and/or
Regulation D (“Regulation D”) as
promulgated by the United States Securities and Exchange Commission (the “Commission”) under the Securities Act of
1933, as amended (the “1933 Act”).

 

WHEREAS, the parties desire that, upon the terms and
subject to the conditions contained herein, the Company shall issue and sell to
the Subscribers, as provided herein, and the Subscribers, in the aggregate,
shall purchase up to Seven Million Five Hundred Thousand Dollars ($7,500,000)
(the “Purchase Price”) of
principal amount of secured promissory notes of the Company (“Note” or “Notes”)
in the form attached hereto as Exhibit A;
and

 

WHEREAS, the aggregate proceeds of the sale of the Notes
contemplated hereby may be held in escrow pursuant to the terms of a Funds
Escrow Agreement to be executed by the parties substantially in the form
attached hereto as Exhibit B
(the “Escrow Agreement”).

 

NOW, THEREFORE, in consideration of the mutual covenants
and other agreements contained in this Agreement the Company and the
Subscribers hereby agree as follows:

 

1.                                       Conditions To
Closing.   Subject to the
satisfaction or waiver of the terms and conditions of this Agreement, on the Closing Date, each Subscriber shall
purchase and the Company shall sell to each Subscriber a Note in the principal
amount designated on the signature page hereto.  The aggregate principal amount of the Notes
to be purchased by the Subscribers on the Closing Date shall, in the aggregate,
be equal to the Purchase Price.  The
Closing Date shall be the date that subscriber funds representing the net
amount due to the Company from the Purchase Price is transmitted by wire
transfer or otherwise to or for the benefit of the Company.

 

At the Closing, the Company shall provide a “Pay
Off Letter” from GC Financial Services Inc. (“GC”)
in substantially the form attached as Exhibit B to the Funds Escrow
Agreement providing for the release of GC’s existing

 

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security interest in the assets of the Company and its Subsidiary (as
defined in Section 5(a) of this Agreement) upon payment to GC of the
amount set forth in the Pay Off Letter.

 

2.                                       Closing.  The consummation of the
transactions contemplated herein shall take place at the offices of Grushko &
Mittman, P.C., 551 Fifth Avenue, Suite 1601, New York, New York 10176,
upon the satisfaction of all conditions to Closing set forth in this Agreement
(“Closing Date”).

 

3.                                       Security Interest.   The
Subscribers will be granted a security interest in all the assets of the
Company, including ownership of Subsidiaries, and in the assets of the
Subsidiaries to be memorialized in a “Security
Agreement”, a form of which is annexed hereto as Exhibit C.   Each Subsidiary will execute and deliver to
the Subscribers a form of “Guaranty”
annexed hereto as Exhibit D.   The Company will execute such other
agreements, documents and financing statements reasonably requested by
Subscribers, which will be filed at the Company’s expense with the
jurisdictions, states and counties designated by the Subscribers.  The Company will also execute all such
documents reasonably necessary in the opinion of Subscriber to memorialize and
further protect the security interest described herein.  The Subscribers will appoint a Collateral
Agent to represent them collectively in connection with the security interest
to be granted to the Subscribers.  The
appointment will be pursuant to a “Collateral
Agent Agreement”, a form of which is annexed hereto as Exhibit E.

 

4.                                       Subscriber’s
Representations and Warranties.  Each
Subscriber hereby represents and warrants to and agrees with the Company only
as to such Subscriber that:

 

(a)                                  Information on
Company.   The Subscriber has been
furnished with or has had access at the EDGAR Website of the Commission to the
Company’s Form 10-KSB for the year ended December 31, 2004 as filed
with the Commission, together with all subsequently filed Forms 10-QSB, 8-K,
and filings made with the Commission available at the EDGAR website
(hereinafter referred to collectively as the “Reports”).  In addition, the Subscriber has received in
writing from the Company such other information concerning its operations,
financial condition and other matters as the Subscriber has requested in
writing (such other information is collectively, the “Other Written Information”), and considered
all factors the Subscriber deems material in deciding on the advisability of
investing in the Notes.

 

(b)                                 Information on
Subscriber.  The Subscriber is an “accredited investor”, as such term is
defined in Regulation D promulgated by the Commission under the 1933 Act, is
experienced in investments and business matters, has made investments of a
speculative nature and has purchased securities of United States publicly-owned
companies in private placements in the past and, with its representatives, has
such knowledge and experience in financial, tax and other business matters as
to enable the Subscriber to utilize the information made available by the
Company to evaluate the merits and risks of and to make an informed investment
decision with respect to the proposed purchase. 
Each Subscriber has the authority and is duly and legally qualified to
purchase and own the Notes.  The
Subscriber is able to bear the risk of such investment for an indefinite period
and to afford a complete loss thereof. 
The information set forth on the signature page hereto regarding
the Subscriber is accurate.

 

(c)                                  Purchase of Notes.  On the Closing Date, the Subscriber will
purchase the Notes as principal for its own account for investment only and not
with a view toward, or for resale in connection with, the public sale or any
distribution thereof.

 

(d)                                 Compliance with
Securities Act.  The Subscriber
understands and agrees that the Notes have not been registered under the 1933
Act or any applicable state securities laws, by reason of their issuance in a
transaction that does not require registration under the 1933 Act (based in
part on the accuracy of the representations and warranties of Subscriber
contained herein), and that such Notes must be held indefinitely unless a subsequent
disposition is registered under the 1933 Act or any applicable state securities
laws or is exempt from such registration.

 

(e)                                  Note
Legend.  The Note shall bear the
following legend:

 

“THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THIS NOTE MAY NOT BE SOLD, OFFERED FOR
SALE,

 

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PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO
THIS NOTE UNDER SAID ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
FORCE PROTECTION, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

 

(f)                                    Communication
of Offer.  The offer
to sell the Notes was directly communicated to the Subscriber by the
Company.  At no time was the Subscriber
presented with or solicited by any leaflet, newspaper or magazine article,
radio or television advertisement, or any other form of general advertising or
solicited or invited to attend a promotional meeting otherwise than in
connection and concurrently with such communicated offer.

 

(g)                                 No Governmental
Review.  Each Subscriber understands
that no United States federal or state agency or any other governmental or
state agency has passed on or made recommendations or endorsement of the Notes
or the suitability of the investment in the Notes nor have such authorities
passed upon or endorsed the merits of the offering of the Notes.

 

(h)                                 Correctness of
Representations.  Each Subscriber
represents as to such Subscriber that the foregoing representations and
warranties are true and correct as of the date hereof and, unless a Subscriber
otherwise notifies the Company prior to the Closing Date shall be true and
correct as of the Closing Date.

 

(i)                                     Survival.   The foregoing representations and warranties
shall survive the Closing Date for a period of two years.

 

5.                                       Company
Representations and Warranties. 
Except as set forth in the Reports, the Company represents and warrants
to and agrees with each Subscriber that:

 

(a)                                  Due
Incorporation.  The Company
and each of its subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of the respective jurisdictions of their
incorporation and have the requisite corporate power to own their properties
and to carry on their business as now being conducted.  The Company and each of its subsidiaries is
duly qualified as a foreign corporation to do business and is in good standing
in each jurisdiction where the nature of the business conducted or property
owned by it makes such qualification necessary, other than those jurisdictions
in which the failure to so qualify would not have a Material Adverse
Effect.  For purpose of this Agreement, a
“Material Adverse Effect” shall
mean a material adverse effect on the financial condition, results of
operations, properties or business of the Company taken as a whole.

 

(b)                                 Outstanding Stock.  All issued and outstanding shares of capital
stock of the Company and each of the Subsidiaries have been duly authorized and
validly issued and are fully paid and nonassessable.

 

(c)                                  Authority;
Enforceability.  This Agreement, the
Note, Funds Escrow Agreement and any other agreements delivered together with
this Agreement or in connection herewith (collectively “Transaction Documents”) have been duly
authorized, executed and delivered by the Company and are valid and binding
agreements enforceable in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors’ rights generally and
to general principles of equity.  The
Company has full corporate power and authority necessary to enter into and
deliver the Transaction Documents and to perform its obligations thereunder.

 

(d)                                 Additional
Issuances.   There are no outstanding
agreements or preemptive or similar rights affecting the Company’s common stock
or equity and no outstanding rights, warrants or options to acquire, or
instruments convertible into or exchangeable for, or agreements or
understandings with respect to the sale or issuance of any shares of common
stock or equity of the Company or other equity interest in any of the
subsidiaries of the Company except as described in the Reports.

 

(e)                                  Consents.  No consent, approval, authorization or order
of any court, governmental agency or body or arbitrator having jurisdiction
over the Company, or any of its Affiliates, the OTC Bulletin Board (the “Bulletin Board”) nor the Company’s
shareholders is required for the execution by the Company of the Transaction

 

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Documents and compliance and performance by the Company of its
obligations under the Transaction Documents, including, without limitation, the
issuance and sale of the Notes.  The
Transaction Documents and the Company’s performance of its obligations
thereunder has been approved unanimously by the Company’s directors.

 

(f)                                    No Violation or
Conflict.  Assuming the
representations and warranties of the Subscribers in Section 4 are true
and correct, neither the issuance and sale of the Notes nor the performance of
the Company’s obligations under this Agreement and all other agreements entered
into by the Company relating thereto by the Company will:

 

(i)                                     violate,
conflict with, result in a breach of, or constitute a default (or an event
which with the giving of notice or the lapse of time or both would be
reasonably likely to constitute a default) under (A) the articles or
certificate of incorporation, charter or bylaws of the Company, (B) to the
Company’s knowledge, any decree, judgment, order, law, treaty, rule, regulation
or determination applicable to the Company of any court, governmental agency or
body, or arbitrator having jurisdiction over the Company or any of its
subsidiaries or over the properties or assets of the Company or any of its
Affiliates, (C) the terms of any bond, debenture, note or any other
evidence of indebtedness, or any agreement, stock option or other similar plan,
indenture, lease, mortgage, deed of trust or other instrument to which the
Company or any of its Affiliates or subsidiaries is a party, by which the
Company or any of its Affiliates or subsidiaries is bound, or to which any of
the properties of the Company or any of its Affiliates or subsidiaries is
subject, or (D) the terms of any “lock-up” or similar provision of any
underwriting or similar agreement to which the Company, or any of its
Affiliates or subsidiaries is a party except the violation, conflict, breach,
or default of which would not have a Material Adverse Effect on the Company; or

 

(ii)                                  except in favor of
the Subscribers, result in the creation or imposition of any lien, charge or
encumbrance upon the Notes or any of the assets of the Company, its
subsidiaries or any of its Affiliates; or

 

(iii)                               result in the
activation of any anti-dilution rights or a reset or repricing of any debt or
security instrument of any other creditor or equity holder of the Company, nor
result in the acceleration of the due date of any obligation of the Company; or

 

(iv)                              result in the activation
of any piggy-back registration rights of any person or entity holding
securities of the Company or having the right to receive securities of the
Company.

 

(g)                                 The
Notes.  The Notes, upon issuance:

 

(i)                                     are, or will be,
free and clear of any security interests, liens, claims or other encumbrances,
subject to restrictions upon transfer under the 1933 Act and any applicable
state securities laws;

 

(ii)                                  have been, or will
be, duly and validly authorized;

 

(iii)                               will not have been
issued or sold in violation of any preemptive or other similar rights of the
holders of any securities of the Company; and

 

(iv)                              will not subject the
holders thereof to personal liability by reason of being such holders.

 

(h)                                 Litigation.  There is no pending or, to the best knowledge
of the Company, threatened action, suit, proceeding or investigation before any
court, governmental agency or body, or arbitrator having jurisdiction over the
Company, or any of its Affiliates that would affect the execution by the
Company or the performance by the Company of its obligations under the
Transaction Documents.  Except as
disclosed in the Reports, there is no pending or, to the best knowledge of the
Company, basis for or threatened action, suit, proceeding or investigation
before any court, governmental agency or body, or arbitrator having
jurisdiction over the Company, or any of its Affiliates which litigation if
adversely determined would have a Material Adverse Effect on the Company.

 

(i)                                     Reporting
Company.  The Company is a
publicly-held company subject to reporting obligations pursuant to Section 13
of the Securities Exchange Act of 1934, as amended (the “1934 Act”) and has a class of

 

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common shares registered pursuant to Section 12(g) of the
1934 Act.  Pursuant to the provisions of
the 1934 Act, the Company has timely filed all reports and other materials
required to be filed thereunder with the Commission during the preceding twelve
months.

 

(j)                                     Information
Concerning Company.  The Reports
contain all material information relating to the Company and its operations and
financial condition as of their respective dates which information is required
to be disclosed therein.   Since the date
of the financial statements included in the Reports, and except as modified in
the Other Written Information or in the Schedules hereto, there has been no
material adverse change in the Company’s business, financial condition or
affairs not disclosed in the Reports. 
The Reports do not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances when
made.

 

(k)                                  Defaults.   The Company is not in violation of its
articles of incorporation or bylaws.  The
Company is (i) not in default under or in violation of any other material
agreement or instrument to which it is a party or by which it or any of its
properties are bound or affected, which default or violation would have a
Material Adverse Effect on the Company, (ii) not in default with respect
to any order of any court, arbitrator or governmental body or subject to or
party to any order of any court or governmental authority arising out of any
action, suit or proceeding under any statute or other law respecting antitrust,
monopoly, restraint of trade, unfair competition or similar matters, or (iii) to
its knowledge not in violation of any statute, rule or regulation of any
governmental authority which violation would have a Material Adverse Effect on
the Company.

 

(l)                                     No General
Solicitation.  Neither the Company,
nor any of its Affiliates, nor to its knowledge, any person acting on its or
their behalf, has engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D under the 1933 Act) in
connection with the offer or sale of the Notes.

 

(m)                               Listing.  The Company’s common stock is quoted on the
Bulletin Board.  The Company has not
received any oral or written notice that its common stock is not eligible nor
will become ineligible for quotation on the Bulletin Board nor that its common
stock does not meet all requirements for the continuation of such
quotation.  The Company satisfies all the
requirements for the continued quotation of its common stock on the Bulletin
Board.

 

(n)                                 No Undisclosed
Liabilities.  The Company has no
liabilities or obligations which are material, individually or in the
aggregate, which are not disclosed in the Reports and Other Written
Information, other than those incurred in the ordinary course of the Company’s
businesses since December 31, 2004 and which, individually or in the
aggregate, would reasonably be expected to have a Material Adverse Effect.

 

(o)                                 No Undisclosed
Events or Circumstances.  Since December 31,
2004, no event or circumstance has occurred or exists with respect to the
Company or its businesses, properties, operations or financial condition, that,
under applicable law, rule or regulation, requires public disclosure or
announcement prior to the date hereof by the Company but which has not been so
publicly announced or disclosed in the Reports.

 

(p)                                 Capitalization.  The authorized and outstanding capital stock
of the Company as of the date of this Agreement and the Closing Date are set
forth on Schedule 5(p).  There are no options, warrants, or rights to
subscribe to, securities, rights or obligations convertible into or
exchangeable for or giving any right to subscribe for any shares of capital
stock of the Company except as disclosed in the Reports.  All of the outstanding shares of Common Stock
of the Company have been duly and validly authorized and issued and are fully
paid and nonassessable.

 

(q)                                 No Disagreements with Accountants and
Lawyers.  There are no disagreements of any kind
presently existing, or reasonably anticipated by the Company to arise, between
the Company and the accountants and lawyers formerly or presently employed by
the Company, including but not limited to disputes or conflicts over payment
owed to such accountants and lawyers.

 

(r)                                    Correctness of
Representations.  The Company
represents that the foregoing representations and warranties are true and
correct as of the date hereof in all material respects, and, unless the Company

 

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otherwise notifies the Subscribers prior to the Closing Date, shall be
true and correct in all material respects as of the Closing Date.

 

(s)                                  Survival.  The foregoing representations and warranties
shall survive the Closing Date for a period of two years.

 

6.                                       Regulation D
Offering.  The offer and issuance of
the Notes to the Subscribers is being made pursuant to the exemption from the
registration provisions of the 1933 Act afforded by Section 4(2) of
the 1933 Act and/or Rule 506 of Regulation D promulgated thereunder.  On the Closing Date, the Company will provide
an opinion reasonably acceptable to Subscriber from the Company’s legal counsel
opining on the availability of an exemption from registration under the 1933
Act as it relates to the offer and issuance of the Notes and other matters
reasonably requested by Subscribers.  A
form of the legal opinion is annexed hereto as Exhibit F.

 

7.1.                              Covenants of the
Company.  The Company covenants and
agrees with the Subscribers as follows:

 

(a)                                  Reporting
Requirements.  From the
date of this Agreement and until the sooner of (i) two (2) years
after the Closing Date, or (ii) until all the Note has been satisfied,
will (x) cause its Common Stock to continue to be registered under Section 12(b) or
12(g) of the 1934 Act, (y) comply in all respects with its reporting and
filing obligations under the 1934 Act, and (z) comply with all reporting
requirements that are applicable to an issuer with a class of shares registered
pursuant to Section 12(b) or 12(g) of the 1934 Act, as applicable.  The Company will use its best efforts not to
take any action or file any document (whether or not permitted by the 1933 Act
or the 1934 Act or the rules thereunder) to terminate or suspend its
reporting and filing obligations under said acts until two (2) years after
the Closing Date.  Until the Note has
been satisfied, the Company will use its best efforts to continue the listing
or quotation of the Common Stock on the OTC Bulletin Board (“Principal Market”) or other market with the reasonable consent
of Subscribers holding a majority of the outstanding Note principal, and will
comply in all respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Principal Market.  The Company agrees to timely file a Form D
with respect to the Notes if required under Regulation D and to provide a copy
thereof to each Subscriber promptly after such filing.

 

(b)                                 Taxes.  From the date of this Agreement and until the
Note has been satisfied, the Company will promptly pay and discharge, or cause
to be paid and discharged, when due and payable, all lawful taxes, assessments
and governmental charges or levies imposed upon the income, profits, property
or business of the Company; provided, however, that any such tax, assessment, charge
or levy need not be paid if the validity thereof shall currently be contested
in good faith by appropriate proceedings and if the Company shall have set
aside on its books adequate reserves with respect thereto, and provided,
further, that the Company will pay all such taxes, assessments, charges or
levies forthwith upon the commencement of proceedings to foreclose any lien
which may have attached as security therefore.

 

(c)                                  Insurance.  From the date of this Agreement and until the
Note has been satisfied, the Company will keep its assets which are of an
insurable character insured by financially sound and reputable insurers against
loss or damage by fire, explosion and other risks customarily insured against
by companies in the Company’s line of business, in amounts sufficient to
prevent the Company from becoming a co-insurer and not in any event less than
one hundred percent (100%) of the insurable value of the property insured; and
the Company will maintain, with financially sound and reputable insurers,
insurance against other hazards and risks and liability to persons and property
to the extent and in the manner customary for companies in similar businesses
similarly situated and to the extent available on commercially reasonable
terms.

 

(d)                                 Books and
Records.  From the
date of this Agreement and until the Note has been satisfied, the Company will
keep true records and books of account in which full, true and correct entries
will be made of all dealings or transactions in relation to its business and
affairs in accordance with generally accepted accounting principles applied on
a consistent basis.

 

(e)                                  Governmental
Authorities.   From the
date of this Agreement and until the Note has been satisfied, the Company shall
duly observe and conform in all material respects to all valid requirements of
governmental authorities relating to the conduct of its business or to its
properties or assets.

 

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(f)                                    Intellectual
Property.  From the
date of this Agreement and until the Note has been satisfied, the Company shall
maintain in full force and effect its corporate existence, rights and
franchises and all licenses and other rights to use intellectual property owned
or possessed by it and reasonably deemed to be necessary to the conduct of its
business.

 

(g)                                 Properties.  From the date of this Agreement and until the
Note has been satisfied, the Company will keep its properties in good repair,
working order and condition, reasonable wear and tear excepted, and from time
to time make all necessary and proper repairs, renewals, replacements,
additions and improvements thereto; and the Company will at all times comply
with each provision of all leases to which it is a party or under which it
occupies property if the breach of such provision could reasonably be expected
to have a Material Adverse Effect.

 

(h)                                 Notice of Certain
Events.   The Company shall promptly
notify Subscribers if Company learns of the occurrence of (i) any event
which constitutes an Event of Default, together with a detailed statement by a
responsible officer of Company of the steps being taken to cure the effect of
such event; (ii) any legal, judicial or regulatory proceedings affecting
Company; (iii) any dispute between Company and any governmental regulatory
body or other entity that is likely to interfere with the normal business
operations of Company; or (iv) any adverse changes, either in any case or
in the aggregate, in the assets, liabilities, financial condition, business,
operations, affairs, or circumstances of Company from those reflected in the
Reports or by the facts warranted or represented in any Transaction
Document.  Company will notify Subscriber
in writing of any material change in its management or change its name or the
location of its chief executive office or principal place of business or the
place where it keeps its books and records.

 

7.2.                              Seniority.   Except as described in the Security
Agreement, until the Notes are fully satisfied, the Company shall not grant nor
allow any security interest to be taken in the assets of the Company or any
subsidiary of the Company; nor issue any debt, equity or other instrument which
would give the holder thereof directly or indirectly, a right in any assets of
the Company or any subsidiary of the Company, superior to any right of the
holder in or to such assets.

 

8.                                       Finder.    The Company on the one hand, and each
Subscriber (for himself only) on the other hand, agree to indemnify the other
against and hold the other harmless from any and all liabilities to any persons
claiming brokerage commissions or finder’s fees on account of services
purported to have been rendered on behalf of the indemnifying party in
connection with this Agreement or the transactions contemplated hereby and
arising out of such party’s actions.  The
Company represents that there are no parties entitled to receive fees,
commissions, or similar payments in connection with the Offering.

 

9.                                       Legal Fees.   On the Closing Date, the Company shall pay
to Grushko & Mittman, P.C., a fee of $15,000 (“Legal Fees”) as reimbursement for services
rendered to the Subscribers in connection with this Agreement and the purchase
and sale of the Notes (the “Offering”)
and acting as Escrow Agent.   The Legal
Fees will be payable out of funds held pursuant to the Escrow Agreement.

 

10.                                 Commitment Fee.   Each Subscriber will receive a credit
against its portion of the Purchase Price equal to 6.6666% of the Principal
Amount of the Note (“Commitment Fee”).  Each Subscriber will deliver its portion of the
Purchase Price to the Escrow Agent net of such Commitment Fee.

 

11.                                 Covenants of the Company Regarding
Indemnification.   The Company agrees to indemnify, hold
harmless, reimburse and defend the Subscribers, the Subscribers’ officers,
directors, agents, Affiliates, control persons, and principal shareholders,
against any claim, cost, expense, liability, obligation, loss or damage
(including reasonable legal fees) of any nature, incurred by or imposed upon
the Subscriber or any such person which results, arises out of or is based upon
(i) any material misrepresentation by Company or breach of any warranty by
Company in this Agreement or in any Exhibits or Schedules attached hereto, or
other agreement delivered pursuant hereto; or (ii) after any applicable
notice and/or cure periods, any breach or default in performance by the Company
of any covenant or undertaking to be performed by the Company hereunder, or any
other agreement entered into by the Company and Subscriber relating hereto.

 

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12.                                 Miscellaneous.

 

(a)                                  Notices.  All notices, demands, requests, consents,
approvals, and other communications required or permitted hereunder shall be in
writing and, unless otherwise specified herein, shall be (i) personally
served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air
courier service with charges prepaid, or (iv) transmitted by hand
delivery, telegram, or facsimile, addressed as set forth below or to such other
address as such party shall have specified most recently by written
notice.  Any notice or other
communication required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile machine, at the address or
number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business
day following the date of mailing by express courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur.  The addresses for
such communications shall be: (i) if to the Company, to: Force Protection, Inc.,
9801 Highway 78, #3, Ladson, SC 29456, telecopier: (843) 553-3832, with a copy
by telecopier only to: Amy Trombly, Esq., Trombly Business Law, 1320
Centre Street, Suite 202, Newton Center, MA 02459, Fax: (617) 243-0066, and (ii) if
to the Subscribers, to: the one or more addresses and telecopier numbers
indicated on the signature pages hereto, with an additional copy by
telecopier only to: Grushko & Mittman, P.C., 551 Fifth Avenue, Suite 1601,
New York, New York 10176, telecopier number: (212) 697-3575.

 

(b)                                 Entire
Agreement; Assignment.  This
Agreement and other documents delivered in connection herewith represent the
entire agreement between the parties hereto with respect to the subject matter
hereof and may be amended only by a writing executed by both parties.  Neither the Company nor the Subscribers have
relied on any representations not contained or referred to in this Agreement
and the documents delivered herewith.  
No right or obligation of the Company shall be assigned without prior
notice to and the written consent of the Subscribers.

 

(c)                                  Counterparts/Execution.  This Agreement may be executed in any number
of counterparts and by the different signatories hereto on separate
counterparts, each of which, when so executed, shall be deemed an original, but
all such counterparts shall constitute but one and the same instrument.  This Agreement may be executed by facsimile
signature and delivered by facsimile transmission.

 

(d)                                 Law Governing
this Agreement.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without regard to principles of conflicts of laws.  Any action brought by either party against
the other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts located
in the state of New York.  The parties and the individuals executing this
Agreement and other agreements referred to herein or delivered in connection
herewith on behalf of the Company agree to submit to the jurisdiction of such
courts and waive trial by jury. 
The prevailing party shall be entitled to recover from the other party
its reasonable attorney’s fees and costs. 
In the event that any provision of this Agreement or any other agreement
delivered in connection herewith is invalid or unenforceable under any
applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law.  Any such provision which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of
any other provision of any agreement.

 

(e)                                  Specific
Enforcement, Consent to Jurisdiction.  The Company and Subscriber acknowledge and
agree that irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed in accordance with their specific terms or
were otherwise breached.  It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent or cure breaches of the provisions of this Agreement and
to enforce specifically the terms and provisions hereof, this being in addition
to any other remedy to which any of them may be entitled by law or equity.  Subject to Section 12(d) hereof,
each of the Company, Subscriber and any signator hereto in his personal
capacity hereby waives, and agrees not to assert in any such suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction in
New York of such court, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper.  Nothing in this Section shall
affect or limit any right to serve process in any other manner permitted by
law.

 

8

 

(f)                                    Independent Nature of Subscribers.   The Company acknowledges
that the obligations of each Subscriber under the Transaction Documents are
several and not joint with the obligations of any other Subscriber, and no
Subscriber shall be responsible in any way for the performance of the
obligations of any other Subscriber under the Transaction Documents.  The
Company acknowledges that the decision of each Subscriber to purchase Notes has
been made by such Subscriber independently of any other Subscriber and independently
of any information, materials, statements or opinions as to the business,
affairs, operations, assets, properties, liabilities, results of operations,
condition (financial or otherwise) or prospects of the Company which may have
been made or given by any other Subscriber or by any agent or employee of any
other Subscriber, and no Subscriber or any of its agents or employees shall
have any liability to any Subscriber (or any other person) relating to or
arising from any such information, materials, statements or opinions.  The
Company acknowledges that nothing contained in any Transaction Document, and no
action taken by any Subscriber pursuant hereto or thereto shall be deemed to
constitute the Subscribers as a partnership, an association, a joint venture or
any other kind of entity, or create a presumption that the Subscribers are in
any way acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Documents.  The Company
acknowledges that each Subscriber shall be entitled to independently protect
and enforce its rights, including without limitation, the rights arising out
of the Transaction Documents, and it shall not be necessary for any
other Subscriber to be joined as an additional party in any proceeding for such
purpose.  The Company acknowledges that it has elected to provide all
Subscribers with the same terms and Transaction Documents for the convenience
of the Company and not because Company was required or requested to do so by
the Subscribers.  The Company acknowledges that such procedure with
respect to the Transaction Documents in no way creates a presumption that the
Subscribers are in any way acting in concert or as a group with respect to the
Transaction Documents or the transactions contemplated thereby.

 

SIGNATURE PAGE TO SUBSCRIPTION AGREEMENT (A)

 

Please acknowledge your acceptance of the
foregoing Subscription Agreement by signing and returning a copy to the
undersigned whereupon it shall become a binding agreement between us.

 

	
   

  	
  FORCE PROTECTION, INC.

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gordon
  McGilton

  	
   

  
	
   

  	
   

  	
  Name: Gordon
  McGilton

  
	
   

  	
   

  	
  Title: Chief
  Executive Offier

  
	
   

  	
   

  
	
   

  	
  Dated: as of November 18, 2005

  

 

	
  SUBSCRIBER

  	
   

  	
  NOTE PRINCIPAL

  	
   

  
	
  LONGVIEW EQUITY FUND, LP

  600 Montgomery Street, 44th Floor

  San Francisco, CA 94111

  Fax: (415) 981-5301 

  	
   

  	
  $

  	
  1,000,000.00

  	
   

  
					

 

 

	
  /s/ Wayne H. Coleson 

  	
   

  	
   

  	
   

  
	
  (Signature)

  By: Wayne H. Coleson, Investment Advisor

  	
   

  	
   

  

 

9

 

	
  SUBSCRIBER

  	
   

  	
  NOTE PRINCIPAL

  	
   

  
	
  LONGVIEW FUND, LP

  600 Montgomery Street, 44th Floor

  San Francisco, CA 94111

  Fax: (415) 981-5301

  	
   

  	
  $

  	
  6,500,000.00

  	
   

  
					

 

 

	
  /s/ S. Michael Rudolph

  	
   

  	
   

  	
   

  
	
  (Signature)

  By: S. Michael Rudolph, Investment Advisor

  	
   

  	
   

  

 

10

 

SCHEDULE 5(P)

 

CAPITALIZATION

 

 

	
  As at
  11/15/05 (all numbers rounded)

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Commmon
  stock outstanding

  	
   

  	
  36,000,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Other
  Warrants

  	
   

  	
  600,000

  	
   

  	
   

  	
   

  
	
  Series D
  Warrants

  	
   

  	
  3,000,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Employee
  Stock Options*

  	
   

  	
  1,000,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  =

  	
  40,600,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Preferred Series A

  	
  0

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Preferred Series B

  	
  0

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Preferred Series C

  	
  0

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Preferred Series D**

  	
  13004

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Series D
  converts

  (@$2.10/share) 

  	
  =

  	
  6,192,380

  	
   

  	
  Common
  Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  46,792,380

  	
   

  	
  Fully Diluted

  	
   

  

 

Employee
Stock Options vesting over various time intervals (figure shown assumes full
vesting and exercise)

Series D
Certificate of Designation grants various shareholder rights, including rights
relating to redemption, seniority and participation

 

11Exhibit 4.7

 

	
   

  	
  Allen & Overy LLP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THIRD SUPPLEMENTAL INDENTURE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  between

  
	
   

  	
   

  
	
   

  	
  AEGON N.V.,

  
	
   

  	
  as issuer

  
	
   

  	
   

  
	
   

  	
  and

  
	
   

  	
   

  
	
   

  	
  CITIBANK, N.A.,

  
	
   

  	
  as trustee

  
	
   

  	
   

  
	
   

  	
  dated as of
  November 23, 2005

  
	
   

  	
   

  
	
   

  	
  to the Indenture
  between

  
	
   

  	
   

  
	
   

  	
  AEGON N.V.,

  
	
   

  	
   

  
	
   

  	
  AEGON Funding
  Corp.,

  
	
   

  	
   

  
	
   

  	
  AEGON Funding
  Corp. II,

  
	
   

  	
   

  
	
   

  	
  and

  
	
   

  	
   

  
	
   

  	
  CITIBANK, N.A.,

  
	
   

  	
  as trustee,
  paying agent and calculation agent

  
	
   

  	
   

  
	
   

  	
  dated as of
  October 11, 2001

  
	
   

  	
   

  
	
   

  	
  $500,000,000
  principal amount of 6.50% Perpetual Capital Securities

  
	
   

  	
  $250,000,000
  principal amount of Floating Rate Perpetual Capital Securities

  

 

1

 

TABLE
OF CONTENTS

 

	
  Section

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  DEFINITIONS

  	
   

  
	
   

  	
  1.1

  	
  Definitions of Terms

  	
   

  
	
  2.

  	
  GENERAL
  TERMS AND CONDITIONS OF THE CAPITAL SECURITIES

  	
   

  
	
   

  	
  2.1

  	
  Designation and Principal
  Amount

  	
   

  
	
   

  	
  2.2

  	
  Maturity

  	
   

  
	
   

  	
  2.3

  	
  Form, Issuance, Registration
  and Exchange

  	
   

  
	
   

  	
  2.4

  	
  Payments

  	
   

  
	
   

  	
  2.5

  	
  Mandatory Payment Events;
  Mandatory Partial Payment Events

  	
   

  
	
  3.

  	
  REDEMPTION
  AND PURCHASES

  	
   

  
	
   

  	
  3.1

  	
  General

  	
   

  
	
   

  	
  3.2

  	
  Optional Redemption

  	
   

  
	
   

  	
  3.3

  	
  Redemption for Tax Reasons

  	
   

  
	
   

  	
  3.4

  	
  Redemption or Conversion for
  Regulatory Reasons

  	
   

  
	
   

  	
  3.5

  	
  Notice of Redemption

  	
   

  
	
   

  	
  3.6

  	
  Purchases

  	
   

  
	
   

  	
  3.7

  	
  Cancellation

  	
   

  
	
  4.

  	
  ALTERNATIVE
  INTEREST SATISFACTION MECHANISM

  	
   

  
	
   

  	
  4.1

  	
  General

  	
   

  
	
   

  	
  4.2

  	
  Notice of Exercise of
  Alternative Interest Satisfaction Mechanism

  	
   

  
	
   

  	
  4.3

  	
  Issue of Common Shares

  	
   

  
	
   

  	
  4.4

  	
  Receipt of Cash Proceeds in
  Respect of Issue of Common Shares to be Used to Satisfy Payment

  	
   

  
	
   

  	
  4.5

  	
  Reservation and
  Insufficiency of Common Shares

  	
   

  
	
   

  	
  4.6

  	
  Market Disruption

  	
   

  
	
   

  	
  4.7

  	
  Certification to Trustee

  	
   

  
	
  5.

  	
  REMEDIES

  	
   

  
	
   

  	
  5.1

  	
  Defaults; Collection of
  Indebtedness and Suits for Enforcement by Trustee

  	
   

  
	
  6.

  	
  SUBORDINATION

  	
   

  
	
   

  	
  6.1

  	
  Agreement to
  Subordinate

  	
   

  
	
   

  	
  6.2

  	
  Section 1401
  of the Base Indenture

  	
   

  
	
  7.

  	
  Covenants of the
  Company

  	
   

  
	
   

  	
  7.1

  	
  Mandatory
  Interest Payments

  	
   

  
	
   

  	
  7.2

  	
  Sufficiency of Shares

  	
   

  
	
   

  	
  7.3

  	
  Payment of
  Proceeds from Sale of Common Shares in Connection with the Alternative
  Interest Satisfaction Mechanism

  	
   

  
	
   

  	
  7.4

  	
  Listing

  	
   

  
	
   

  	
  7.5

  	
  Officer’s
  Certificate on Deferral

  	
   

  
	
   

  	
  7.6

  	
  Officer’s
  Certificate on Market Disruption Event

  	
   

  
	
  8.

  	
  FORM OF
  CAPITAL SECURITIES

  	
   

  
	
   

  	
  8.1

  	
  Form of
  Capital Securities

  	
   

  
	
  9.

  	
  ORIGINAL
  ISSUE OF CAPITAL SECURITIES

  	
   

  
	
   

  	
  9.1

  	
  Original
  Issue of Capital Securities

  	
   

  
	
  10.

  	
  WINDING
  UP

  	
   

  
	
   

  	
  10.1

  	
  Winding-Up

  	
   

  
					

 

ii

 

	
  11.

  	
  SATISFACTION AND
  DISCHARGE

  	
   

  
	
   

  	
  11.1

  	
  Satisfaction
  and Discharge

  	
   

  
	
  12.

  	
  TAXATION;
  ADDITIONAL AMOUNTS

  	
   

  
	
   

  	
  12.1

  	
  General

  	
   

  
	
   

  	
  12.2

  	
  Section 1006
  of the Base Indenture

  	
   

  
	
  13.

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
  13.1

  	
  Issuance of
  Definitive Securities

  	
   

  
	
   

  	
  13.2

  	
  Ratification
  of Base Indenture; Third Supplemental Indenture Controls

  	
   

  
	
   

  	
  13.3

  	
  Trustee Not
  Responsible for Recitals

  	
   

  
	
   

  	
  13.4

  	
  Calculation Agent

  	
   

  
	
   

  	
  13.5

  	
  Governing Law

  	
   

  
	
   

  	
  13.6

  	
  Severability

  	
   

  
	
   

  	
  13.7

  	
  Counterparts

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Schedule

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Form of
  6.50% Perpetual Capital Securities

  	
   

  
	
  2.

  	
  Form of
  Floating Rate Perpetual Capital Securities

  	
   

  

 

iii

 

THIRD SUPPLEMENTAL INDENTURE

 

THIRD
SUPPLEMENTAL INDENTURE dated as of November 23,
2005 (the Third Supplemental Indenture)

 

AMONG:

 

(1)           AEGON N.V., a
Netherlands public company with limited liability (AEGON N.V.
or the Company), having its
principal executive office at AEGONplein 50, 2501 CE, The Hague, The
Netherlands; and

 

(2)           CITIBANK, N.A., a
national banking association duly organized and existing under the laws of the
United States of America, as Trustee (the Trustee)
to the Indenture, dated October 11, 2001, between the Company, AEGON
Funding Corp. (AEGON Funding), AEGON Funding II
Corp. (AEGON Funding II) and the Trustee, as
modified by a supplemental indenture dated November 14, 2003, and a Second
Supplemental Indenture dated June 1, 2005, between the Company, AEGON
Funding, AEGON Funding II and the Trustee (together, the Base Indenture, and collectively with this
Third Supplemental Indenture, the Indenture).

 

In addition, Citibank, N.A., through its New York branch, has agreed to
act as Paying Agent and Calculation Agent hereunder.

 

WHEREAS:

 

(A)          the Company, AEGON Funding,
AEGON Funding II and the Trustee executed and delivered the Base Indenture to
provide for the future issuance of the Securities to be issued from time to
time in one or more series as might be determined under the Base Indenture, in
an unlimited aggregate principal amount, which may be authenticated and
delivered as provided in the Base Indenture;

 

(B)           Section 301 of the Base
Indenture permits the terms of any series of Securities to be established
pursuant to a Board Resolution or in one or more indentures supplemental to the
Base Indenture;

 

(C)           the Company desires to issue
two series of Securities, the terms of which it deems appropriate to set out in
this Third Supplemental Indenture;

 

(D)          pursuant to the terms of the
Base Indenture, the Company may issue Securities now and additional Securities
of the same or different series at later dates under the Base Indenture, as
established by the Company, and the Company desires to initially issue
$500,000,000 aggregate principal amount of Securities, entitled the 6.50%
Perpetual Capital Securities (the Fixed Rate Securities) plus $250,000,000
aggregate principal amount of Securities, entitled the Floating Rate Perpetual
Capital Securities (the Floating Rate Securities, and together with the Fixed Rate Securities, the Capital Securities) plus up to $50,000,000
aggregate principal amount of Fixed Rate Securities and up to $25,000,000
aggregate principal amount of Floating Rate Securities if, and to the extent
that, the underwriters of either series of the Capital Securities elect to
exercise their over-allotment options in whole or in part, the form and
substance of each series of the Capital Securities and any Fixed Rate
Securities or Floating Rate Securities issued as a result of the exercise of
the aforementioned options and the terms, provisions and conditions thereof to
be set forth as provided in the Base Indenture as supplemented by this Third
Supplemental Indenture;

 

1

 

(E)           pursuant to Section 301
of the Base Indenture, the Company desires to appoint Citibank, N.A., through
its New York branch, to act as Paying Agent with respect to each series of the
Capital Securities and as Calculation Agent, with respect to the Floating Rate
Capital Securities;

 

(F)           each series of the Capital
Securities shall be treated as a separate series of Securities in accordance
with the terms of the Indenture and for all purposes under the Indenture; and

 

(G)           the Company has duly
authorized the execution and delivery of this Third Supplemental Indenture and
requested that the Trustee execute and deliver this Third Supplemental
Indenture, and all requirements necessary to make this Third Supplemental
Indenture a valid and binding instrument in accordance with its terms have been
done.

 

NOW
THEREFORE, in consideration of the purchase and acceptance of
each series of the Capital Securities by the holders thereof, and for the
purpose of setting forth, as provided in the Indenture, the form and substance
of each series of the Capital Securities and the terms, provisions and
conditions thereof, as well as for other purposes set forth herein, the parties
hereto hereby agree as follows:

 

1.             DEFINITIONS

 

1.1          Definitions of
Terms

 

For all purposes
of the Indenture, except as otherwise expressly provided or unless the context
otherwise requires:

 

(a)           a
term defined in the Base Indenture and not otherwise defined herein has the
same meaning when used in this Third Supplemental Indenture;

 

(b)           unless
otherwise specified, a reference to a Section or Article is to a Section or
Article of this Third Supplemental Indenture;

 

(c)           headings
are for convenience of reference only and do not affect interpretation;

 

(d)           references
to the Capital Securities mean both series of Capital Securities; and

 

(e)           the following terms have the meanings set forth below for purposes of
this Third Supplemental Indenture and the Base Indenture as it relates to the
series of Capital Securities issued hereunder.

 

Accrued Interest Payment
means, at any time, the amount of interest that has continued to accrue after
an Interest Payment Date in respect of (i) an
Optionally Deferred Payment, (ii) the failure to make a payment when due
on an Interest Payment Date, (iii) certain payments which cannot be made
due to insufficient Common Shares to satisfy the Alternative Interest Satisfaction
Mechanism or (iv) failure to make a payment more than 14 days after its
due date due to a Market Disruption Event.

 

Additional Amounts has
the meaning specified in Section 12.1.

 

Alternative Interest Satisfaction
Mechanism has the meaning specified in Section 4.1.

 

Applicable Interest Rate
means in relation to (i) any Optionally Deferred Payment (ii) the
failure to make a payment when due on an Interest Payment Date, (iii) certain
payments which cannot be made due to insufficient Common Shares to satisfy the
Alternative Interest Satisfaction Mechanism or (iv) the failure

 

2

 

to make a Payment more than 14 days after its due
date due to a Market Disruption Event, (a) in the case of the Floating
Rate Securities, the interest rate payable on the Floating Rate Securities as
determined by the Calculation Agent for the Interest Period(s) during which
such Payment is deferred or (b) in the case of the Fixed Rate Securities,
6.50%.

 

Base Indenture has the meaning
specified in the Recitals.

 

Base Redemption Price has
the meaning specified in Section 3.2.

 

Business Day
means a day, other than a Saturday or Sunday, on which commercial banks and
foreign exchange markets are open for general business in New York and Amsterdam.

 

Calculation Agency Agreement
means the calculation agency agreement dated as of November 23, 2005,
between the Company and the Calculation Agent, relating to the Floating Rate
Securities under which the Calculation Agent agrees to perform the duties
required of it under the terms of the Indenture.

 

Calculation Agent
means Citibank, N.A., as calculation agent in relation to the Floating Rate
Securities, or its successor or successors for the time being appointed under
the Calculation Agency Agreement.

 

Capital Adequacy Regulations
means, at any time, the regulations, requirements, guidelines, policies or
decrees imposing obligations on AEGON N.V., as a holding company, with respect
to the maintenance of minimum levels of solvency margins and/or capital
adequacy ratios and/or comparable margins or ratios, as well as regarding the
supervision thereof by any existing or future regulator having primary
supervisory authority with respect to AEGON N.V.

 

Capital Securities has the meaning specified in the Recitals.

 

Common Shares means the common
shares, par value 0.12 euros per common share, of AEGON N.V.

 

Deferral Notice has
the meaning specified in Section 2.4(e).

 

Deferred Interest Satisfaction Date
means:

 

(i)            the
Interest Payment Date following the 19th Business Day after the Required
Deferral Condition fails to be met;

 

(ii)           if
other than an Interest Payment Date, the date on which the Company resolves to
satisfy a Mandatorily Deferred Payment or Optionally Deferred Payment, as
notified by the Company to the Trustee, the holders of Capital Securities and,
in the case of the Floating Rate Securities, also to the Calculation Agent; or

 

(iii)          the
date on which the Company is required to satisfy all Mandatorily Deferred
Payments and Optionally Deferred Payments as a result of the occurrence of a
Mandatory Payment Event or a Mandatory Partial Payment Event.

 

Deferred Payment means
a Mandatorily Deferred Payment and/or an Optionally Deferred Payment that has
not subsequently been satisfied or deferred as provided in Section 2.4.

 

DTC means The
Depository Trust Company.

 

3

 

Existing Capital Securities
means two series of the Company’s perpetual capital securities in aggregate
principal amount of €950 million and $500 million, respectively, issued under a
trust deed dated July 15, 2004 between AEGON N.V., as issuer, and ATC
Financial Services B.V., together with one series of perpetual capital
securities in aggregate principal amount of $1 billion issued under the Base
Indenture.

 

Fixed Rate Securities has
the meaning set forth in the Recitals.

 

Floating Rate Securities has
the meaning set forth in the Recitals.

 

Indenture has
the meaning specified in the Recitals.

 

Interest shall,
where appropriate, include Interest Amounts, Mandatorily Deferred Payments,
Optionally Deferred Payments and Accrued Interest Payments.

 

Interest Amount
means:

 

(i)            in
respect of an Interest Payment, the amount of interest payable on a Capital
Security for the relevant Interest Period; and

 

(ii)           in
the event of redemption due to a Tax Event or for regulatory reasons, any
interest accrued from (and including) the preceding Interest Payment Date (or,
if none, the Issue Date) to (but excluding) the due date for redemption, and,
if not an Interest Payment Date, as calculated (a) in the case of the
Fixed Rate Securities, on a 30/360 day basis and (b) in the case of the
Floating Rate Securities, on the basis of a 360-day year and the actual number
of days elapsed in the relevant Interest Period, but in either case not
including the date of redemption.

 

Interest Payment
means, in respect of an Interest Payment Date, the aggregate Interest Amount
for the Interest Period ending on such Interest Payment Date.

 

Interest Payment Date has
the meaning with respect to each of the Fixed Rate Securities and the Floating
Rate Securities as specified in Section 2.4(c).

 

Interest Period has
the meaning specified in Section 2.4(d).

 

Interest Rate
means (a) with respect to the Fixed Rate Securities, the interest rate set
forth in Section 2.4 (a) (Fixed Interest Rate)
or (b) with respect to the Floating Rate Securities, the interest rate set
forth in Section 2.4(b) (Floating Interest Rate).

 

Issue Date means
November 23, 2005.

 

Junior Guarantee
means any guarantee, indemnity or other contractual support arrangement entered
into by the Company in respect of securities (regardless of name or
designation) issued by one of the Company’s subsidiaries or Undertakings and
ranking, on a winding-up (faillissement
or vereffening na ontbinding) or
in respect of distributions or payment of dividends or any other payment
thereon, after the Capital Securities.

 

Junior Securities
means AEGON N.V.’s Common Shares or any of its other securities which rank
after the Capital Securities with respect to distributions on a return of
assets on its winding-up (faillissement
or vereffening na ontbinding) or
in respect of distributions or payment of dividends or any other payments
thereon.

 

4

 

LIBOR has the meaning
specified in Section 2.4(b).

 

Mandatorily Deferred Payment is
a payment that the Company is required to defer because the Required Deferred
Condition is met.

 

Mandatory Partial Payment
means a Payment in respect of each Capital Security in an amount that results
in payment of a proportion of a full Interest Payment on the Capital Security
on such Interest Payment Date equal to the proportion of a full payment on the
relevant Parity Securities and/or payment on the relevant Parity Guarantee paid
on the payment date in respect of the relevant Parity Securities and/or Parity
Guarantee immediately preceding such Interest Payment Date.

 

Mandatory Partial Payment Event has
the meaning specified in Section 2.5(c).

 

Mandatory Payment Event has
the meaning specified in Section 2.5(b).

 

Market Disruption Event means:

 

(i)            the
occurrence or existence of any suspension of or limitation imposed on trading
by reason of movements in price exceeding limits permitted by Euronext
Amsterdam N.V. or the New York Stock Exchange or on settlement procedures for
transactions in the Common Shares on Euronext Amsterdam N.V. or the New York
Stock Exchange if, in any such case, that suspension or limitation is material
in the context of the sale of the Common Shares;

 

(ii)           in
the opinion of the Company, there has been a substantial deterioration in the
price and/or value of the Common Shares or circumstances are such as to prevent
or to a material extent restrict the issue or delivery of the Common Shares;

 

(iii)          where,
pursuant to the terms of the Indenture, monies are required to be converted
from one currency into another currency in respect of any payment, the
occurrence of any event that makes it impracticable to effect such conversion;
or

 

(iv)          where,
in the opinion of the Company, there will have been such a change in national
or international financial, political or economic conditions or currency
exchange rates or exchange controls as would in the Company’s view be likely to
prejudice materially the success of the offering and distribution of the Common
Shares or dealings in the Common Shares in the secondary market, if any.

 

Optionally Deferred Payment is
a payment that the Company elects to defer pursuant to Section 2.4(g).

 

Outstanding Payment
means:

 

(i)            in
relation to any Interest Payment, any Deferred Payment or Interest Amount not
falling within the definition of Interest Payment, that such payment (a) has
either become due and payable or would have become due and payable except for
the non-satisfaction on the Relevant Date due to (1) a failure to meet the
conditions of payment pursuant to Section 2.4(h) or (2) the
deferral, postponement or suspension of such payment due to a Required Deferral
Condition, an Optionally Deferred Payment or insufficient Common Shares
available to satisfy the Alternative Interest Satisfaction Mechanism, or (3) failure
to make a payment more than 14 days after its due date due to a Market
Disruption Event; and (b) in any such case has not been satisfied; and

 

5

 

(ii)           in
relation to any Accrued Interest Payment, any amount thereof which has not been
satisfied whether or not payment has become due.

 

Parity Guarantee
means any guarantee, indemnity or other contractual support arrangement the
Company enters into with respect to securities (regardless of name or
designation) issued by any of the Company’s subsidiaries or Undertakings that
rank on its winding-up (faillissement or
vereffening na ontbinding) or in
respect of distributions or payments thereon equally with the Capital
Securities.

 

Parity Securities
means, in respect of the Company, any securities that rank equally with the
Capital Securities with respect to distributions on a return of assets on its
winding-up (faillissement or vereffening na ontbinding) or in respect
of distribution or payment of any amounts thereunder by the Company. For the
avoidance of doubt, the Capital Securities rank equally with the Existing
Capital Securities.

 

Paying Agent means
Citibank, N.A. as paying agent in relation to the Capital Securities, or its
successor or successors for the time being appointed in accordance with the
terms of the Indenture.

 

Payment
means any Interest Payment, Mandatorily Deferred Payment, Optionally Deferred
Payment, Accrued Interest Payment, payment of the Base Redemption Price or
Interest Amount not falling within the definition of Interest Payment.

 

Payment Default has
the meaning specified in Section 5.1(a).

 

Payment Event has
the meaning specified in Section 5.1(c).

 

Regular Record Date means
the March 1, June 1, September 1 or December 1, as
applicable, immediately preceding an Interest Payment Date.

 

Regulatory Event
means that the Company shall have become subject to supervision by any existing
or future regulator pursuant to law or regulation and that its solvency margin,
capital adequacy ratios or comparable margins or ratios under the Capital
Adequacy Regulations are or as a result of a Payment would become less than the
relevant minimum requirements as to be applied and enforced by such regulator
pursuant to the Capital Adequacy Regulations.

 

Relevant Date
means:

 

(i)            in
respect of any payment other than a Winding-Up Claim, the date on which such
payment first becomes due and payable but, if the full amount of the monies
payable on such date has not been received by the Trustee on or prior to such
date, the “Relevant Date” means the date on which such monies will have been so
received and notice to that effect will have been given to the holders in
accordance with Section 106 of the Base Indenture; and

 

(ii)           in
respect of a Winding-Up Claim, the date which is one day prior to the
commencement of the winding-up.

 

Required Deferral Condition
means the Company (i) is not Solvent or making the relevant Payment will
result in the Company becoming not Solvent or (ii) is subject to a
Regulatory Event or making the relevant Payment will result in the Company
becoming subject to a Regulatory Event.

 

Securities has
the meaning set forth in the Base Indenture.

 

6

 

Senior Creditors means all the
present and future creditors of the Company:

 

(i)            who
are unsubordinated creditors;

 

(ii)           whose
claims are, or are expressed to be, subordinated (whether only in the event of
a winding-up (faillissement or vereffening na ontbinding) or otherwise) only to the claims
of the Company’s unsubordinated creditors; and

 

(iii)          who
are subordinated creditors, other than those whose claims are, or are expressed
to rank, equally with, or junior to, the claims of holders of Capital
Securities.

 

Senior Debt means
indebtedness of the Company held by one or more of its Senior Creditors as
Senior Creditors.

 

Solvent
means the Company is (i) able to pay its debts to Senior Creditors as they
become due and (ii) the Company’s assets exceed the sum of its liabilities
(other than its liabilities to persons who are not Senior Creditors). For these
purposes, “assets” refers to the Company’s non-consolidated gross assets and “liabilities”
means its non-consolidated gross liabilities, in each case as shown by the
Company’s then latest published audited balance sheet but adjusted for
contingencies and for subsequent events and to such extent as the board of
directors, the auditors or, as the case may be, the liquidator may determine to
be appropriate.

 

Tax Event has
the meaning specified in Section 3.3.

 

Undertaking
means a corporate body, partnership, limited partnership, cooperative or an
incorporated association carrying on a trade or business with or without a view
to profit in which the Company has a direct or indirect financial, commercial
or contractual majority interest.

 

Winding-Up Claim
means, with respect to each series of Capital Securities, amounts in respect of
principal or payments in respect of which the conditions of payment pursuant to
Section 2.4(h) are not satisfied on the date upon which the same
would otherwise be due and payable by the Company in its winding-up (faillissement or vereffening na ontbinding) (upon
dissolution or otherwise) and on any redemption pursuant to Article 3. A
Winding-Up Claim will not bear interest.

 

2.             GENERAL TERMS AND CONDITIONS OF THE
CAPITAL SECURITIES

 

2.1          Designation and
Principal Amount

 

The aggregate
principal amount of Capital Securities of any series which may be authenticated
and delivered under this Indenture is unlimited.

 

2.2          Maturity

 

The Capital
Securities are perpetual securities and shall have no fixed maturity or
mandatory redemption date provided that the Company shall have the right to
redeem either series of the Capital Securities in accordance with Article 3.

 

7

 

2.3          Form, Issuance,
Registration and Exchange

 

The Capital
Securities of each series shall:

 

(a)           be
issued as Securities in minimum denominations of $25.00 and integral multiples
thereof represented by one or more Global Securities, and each such series shall
not be exchangeable for definitive securities except in the limited
circumstances as provided in Section 13.1; and

 

(b)           be
issued as Global Securities deposited with or on behalf of DTC or its nominee
and registered in the name of Cede & Co., as nominee of DTC; provided,
however, (i) such Global Securities may not be transferred except as a
whole by DTC to a nominee or a successor of DTC, unless and until the Capital
Securities of any such series are exchanged for definitive securities in the
limited instances as provided Section 13.1; (ii) beneficial interests
in Global Securities will be shown on, and transfers thereof will be effected
only through, the book-entry records of DTC and its direct or indirect
participants; and (iii) so long as DTC, or its nominee, is the holder of
the Global Securities, it will be considered the sole holder of the Global
Securities for all purposes under the Indenture.

 

2.4          Payments

 

(a)           Interest Rate – Fixed Interest Rate

 

The interest rate payable in
respect of the Fixed Rate Securities is equal to 6.50% per annum.  Interest on the Fixed Rate Securities will be
computed and paid on the basis of a 360-day year consisting of 12 months of 30
days each.

 

(b)           Interest Rate – Floating Interest Rate

 

(i)            The
annual rate of interest on the Floating Rate Securities will be reset quarterly
on each Interest Payment Date (each of these dates is also called an Interest Reset Date) and will be equal to the greater of (a) three-month
LIBOR plus 0.875% and (b) 4.00%. 
With respect to the initial interest period, however, the interest rate
will be [-]%.

 

(ii)           LIBOR for each Interest Reset Date, other than for
the initial interest rate, will be determined by the Calculation Agent as
follows:

 

LIBOR will be the offered
rate for deposits in U.S. dollars for the three month period which appears on “Telerate
Page 3750” at approximately 11:00 a.m., London time, two “London
banking days” prior to the applicable Interest Reset Date.

 

If this rate does not appear
on the “Telerate Page 3750” at such time and date, the Calculation Agent
will determine the rate on the basis of the rates at which deposits in U.S.
dollars are offered by four major banks in the London interbank market
(selected by the Calculation Agent after consulting with the Company) at
approximately 11:00 a.m., London time, two London banking days prior to
the applicable Interest Reset Date to prime banks in the London interbank
market for a period of three months commencing on that Interest Reset Date and
in a principal amount equal to an amount not less than $1,000,000 that is
representative for a single transaction in such market at such time.  In such case, the Calculation Agent will request
the principal London office of each of the aforesaid major banks to provide a
quotation of such rate.  If at least two

 

8

 

such quotations are
provided, LIBOR for that Interest Reset Date will be the average of the
quotations.  If fewer than two quotations
are provided as requested, LIBOR for that Interest Reset Date will be the
average of the rates quoted by three major banks in New York, New York
(selected by the Calculation Agent after consulting with the Company) at
approximately 11:00 a.m., New York time, two London banking days prior to
the applicable Interest Reset Date for loans in U.S. dollars to leading banks
for a period of three months commencing on that Interest Reset Date and in a
principal amount equal to an amount not less than $1,000,000 that is
representative for a single transaction in such market at such time; provided
that if fewer than three quotations are provided as requested, for the period
until the next Interest Reset Date, LIBOR will be the same as the rate
determined on the immediately preceding Interest Reset Date.

 

A “London banking day” is
any day, other than a Saturday or Sunday, in which dealings in U.S. dollar
deposits are transacted in the London interbank market.  “Telerate Page 3750” means the display
designated as “Page 3750” (or any successor page) on Moneyline Telerate, Inc.
or any successor service as may be nominated by the British Bankers’
Association for the purpose of displaying the London interbank rates of major
banks for United States dollar deposits.

 

(iii)          Determination
of Interest Rate and Aggregate Interest Amounts

 

The Calculation Agent will,
upon the determination of each interest rate as described herein, calculate the
aggregate interest amount and cause the interest rate and aggregate interest
amount payable in respect of an Interest Period to be notified to the Company,
the Trustee and the New York Stock Exchange (for purposes of notification to
the New York Stock Exchange, an electronic mail may be sent to Paris Madho at
pmadho@nyse.com or such other address as may be notified by the New York Stock
Exchange).

 

All calculations made by the
Calculation Agent in the absence of wilful misconduct, bad faith or manifest
error shall be conclusive for all purposes and binding on the Company and the
holders of Floating Rate Securities. The Company may appoint a successor
Calculation Agent at any time at the Company’s discretion and without notice.

 

Interest on the Floating
Rate Securities will be computed and paid on the basis of a 360-day year and
the actual number of days elapsed in the Interest Period, except that interest
for the initial period will be calculated from the original issue date. The
interest rate on the Floating Rate Securities will in no event be higher than
the maximum rate permitted by New York law, as the same may be modified by
United States law of general application.

 

(iv)          Determination
or Calculation by Trustee

 

If the Calculation Agent
does not at any time for any reason (i) determine the interest rate in
accordance with the provisions herein or (ii) calculate an Interest Amount
in accordance with the provisions herein, the Trustee or an agent on its behalf
will calculate the interest rate and Interest Amount. Such calculation will be
deemed to have been made by the Calculation Agent. The Trustee or such agent
will make the calculations in accordance with the foregoing provisions (with
any necessary consequential amendments) to the extent possible, and in such
manner as it deems fair

 

9

 

and reasonable in the
circumstances. All determinations or calculations made or obtained for these
purposes by or on behalf of the Trustee, will (in the absence of willful
default, bad faith or manifest error) be binding on the Company, the
Calculation Agent and the holders of Floating Rate Securities and (in the
absence of willful default or bad faith) the Trustee will have no liability to
the Company or to the holders of Floating Rate Securities in connection with
the exercise or non-exercise by it of its powers, duties and discretions
pursuant to these provisions.

 

(c)           Interest Payment Dates

 

(i)            Fixed
Rate Securities

 

Subject to the provisions
herein, interest on the Fixed Rate Securities will be payable quarterly in
arrears in equal payments for any full Interest Period on March 15, June 15,
September 15 and December 15 of each year, commencing on March 15,
2006, each such date with respect to Fixed Rate Securities is herein referred
to as an Interest Payment Date.  If any Interest Payment Date falls on a day
that is not a Business Day, the Company shall make the required payment on the
next succeeding Business Day, and no additional interest will accrue in respect
of any payment made on the next succeeding Business Day.

 

(ii)           Floating
Rate Securities

 

Subject to the provisions
herein, interest on the Floating Rate Securities will be payable quarterly in
arrears for any full Interest Period on March 15, June 15, September 15
and December 15 of each year, commencing on March 15, 2006.  If any date on which interest would otherwise
be payable falls on a day that is not a Business Day, then the interest payment
date will be the next succeeding Business Day, except if such next succeeding Business
Day falls in the next succeeding calendar month, in which case the interest
payment date will be the immediately precedent Business Day.  Such dates with respect to the Floating Rate
Securities are herein referred to as an Interest Payment Date.

 

The regular record dates for
each Interest Payment Date referred to in clauses (i) and (ii) immediately
above will be March 1, June 1, September 1 and December 1,
respectively.

 

(d)           Interest Period.  Subject to the conditions contained in the
Indenture, the Company shall make interest payments in an amount equal to the
interest accrued from (and including) the immediately preceding Interest
Payment Date in respect of which Interest has been paid on the relevant series
of Capital Securities or from (and including) the date of issue, if no such Interest
has been paid, to (but excluding) the next succeeding applicable Interest
Payment Date (each, an Interest Period).  The Company shall make the Interest Payments on
each series through the Paying Agent to the person in whose name the Capital
Security of the relevant series is registered on the Regular Record Date.  Each Capital Security of any series shall
cease to bear interest from the due date for redemption, if any, unless, upon
due presentation, payment of principal is improperly withheld or refused. In
such event, it shall continue to bear interest at the Interest Rate as provided
herein.

 

10

 

(e)           Required Deferral of Payments Before the Company is Subject to Capital
Adequacy Regulations.

 

(i)            Except
as required by Section 2.5, if, prior to such date as the Company becomes
subject to Capital Adequacy Regulations, on the 20th Business Day prior to the
date on which any payment (not including principal) with respect to either
series of the Capital Securities would otherwise be due and payable, the
Company determines that it is not Solvent or that payment of the relevant
payment or part thereof on such series of Capital Securities would result in it
becoming not Solvent, the Company shall defer such payment or such part thereof
on such series of Capital Securities, as the case may be, by giving notice to
the Trustee and the holders of the relevant series of the Capital Securities,
and in the case of the Floating Rate Securities, also to the Calculation
Agent.  Such deferred payment (together
with any required deferral due to a Regulatory Event (as described below)),
shall constitute a Mandatorily Deferred
Payment and such notice as well as any similar notice given in the
event of a Mandatorily Deferred Payment due to the occurrence of a Regulatory
Event or an Optionally Deferred Payment (as described below) shall constitute a
Deferral Notice.  A Deferral Notice shall be given not less
than 16 Business Days prior to the payment due date. This required deferral is
subject to the Alternative Interest Satisfaction Mechanism.

 

If, after the Company defers
a payment for this reason, the relevant Required Deferral Condition is no
longer met on the 20th Business Day preceding any subsequent Interest Payment
Date for such series of Capital Securities, then the Company shall satisfy such
payment on the relevant Deferred Interest Satisfaction Date by giving notice,
not less than 16 Business Days prior to the Deferred Interest Satisfaction
Date, to the Trustee and the holders of the relevant series of the Capital
Securities and, in the case of the Floating Rate Securities, also to the
Calculation Agent, that it will satisfy such payment on such date.

 

(ii)           The
Company shall not satisfy such payment on the relevant Deferred Interest
Satisfaction Date referred to above, if:

 

(A)          it
has previously elected to satisfy such payment earlier (provided that, at the
time of satisfying such payment, the relevant Required Deferral Condition fails
to be met) by delivering a notice to the Trustee and the holders of the
relevant holders of the Capital Securities and, in the case of the Floating
Rate Securities, also to the Calculation Agent, not less than 16 Business Days
prior to the relevant Deferred Interest Satisfaction Date that the Company will
satisfy such payment on such date; or

 

(B)           the
Company validly elects to use its right to optionally defer any such payment
that would otherwise have been required to be paid on such Deferred Interest
Satisfaction Date pursuant to Section 2.4(g).

 

(iii)          The
Company may only satisfy its obligation to pay a Mandatorily Deferred Payment
in accordance with the Alternative Interest Satisfaction Mechanism.  A Mandatorily Deferred Payment shall not
accrue interest, except as provided in Article 4.

 

11

 

(f)            Required Deferral of Payments After the Company Becomes Subject to
Capital Adequacy Regulations.

 

(i)            Except
as required by Section 2.5, if, after such date as the Company becomes
subject to Capital Adequacy Regulations, on the 20th Business Day prior to the
date on which any payment (not including principal) with respect to either
series of the Capital Securities would otherwise be due and payable, the
Company determines that it is subject to a Regulatory Event or that payment of
the relevant payment or part thereof on such series of Capital Securities would
result in it becoming subject to a Regulatory Event, the Company shall defer
such payment or such part thereof on such series of Capital Securities, as the
case may be, by giving a Deferral Notice to the Trustee and the holders of the
relevant series of the Capital Securities and, in the case of the Floating Rate
Securities, also to the Calculation Agent. 
A Deferral Notice must be given not less than 16 Business Days prior to
the payment due date.

 

If, after the Company defers
a payment for this reason, the relevant Required Deferral Condition is no
longer met on the 20th Business Day preceding any subsequent Interest Payment
Date for such series of Capital Securities, then it shall satisfy such payment
on the relevant Deferred Interest Satisfaction Date by giving notice, not less
than 16 Business Days prior to the Deferred Interest Satisfaction Date, to the
Trustee and the holders of the relevant series of the Capital Securities and,
in the case of the Floating Rate Securities, also to the Calculation Agent,
that it will satisfy such payment on such date.

 

(ii)           The
Company shall not satisfy such payment on the relevant Deferred Interest Satisfaction
Date referred to above, if:

 

(A)          the
Company has previously elected to satisfy such payment earlier (provided that,
at the time of satisfying such payment, the relevant Required Deferral
Condition fails to be met) by delivering a notice to the Trustee and the
holders of the relevant series of the Capital Securities and, in the case of
the Floating Rate Securities, also to the Calculation Agent, not less than 16
Business Days prior to the relevant Deferred Interest Satisfaction Date that it
will satisfy such payment on such date; or

 

(B)           the
Company validly elects to use its right to optionally defer any such payment
that would otherwise have been required to be paid on such Deferred Interest
Satisfaction Date pursuant to Section 2.4(g).

 

(iii)          The
Company may only satisfy its obligations to pay a Mandatorily Deferred Payment
in accordance with the Alternative Interest Satisfaction Mechanism. A
Mandatorily Deferred Payment shall not accrue interest, except as provided in Article 4.

 

(g)           Optionally Deferred Payment.

 

(i)            Subject
to the conditions contained in Section 2.5 below, the Company may at any
time in its sole discretion and for any reason defer all or part of any Payment
on either series of the Capital Securities that would in the absence of deferral
be due and payable by giving a Deferral Notice to the Trustee and the holders
of the relevant series of the Capital Securities and, in the case of the
Floating Rate Securities, also to the Calculation

 

12

 

Agent, not less than 16 Business Days prior to the relevant due date.
The Company shall then, subject to the absence of a Required Deferral
Condition, satisfy any such Optionally Deferred Payment at any time by means of
an issuance of Common Shares in accordance with the Alternative Interest
Satisfaction Mechanism, upon delivery of a notice to the Trustee and the
holders of the relevant series of the Capital Securities and, in the case of
Floating Rate Securities, also to the Calculation Agent, not less than 16
Business Days prior to the relevant Deferred Interest Satisfaction Date,
informing them of the Company’s election to so satisfy such payment and
specifying the relevant Deferred Interest Satisfaction Date.

 

(ii)           Optionally
Deferred Payments will bear interest at the applicable Interest Rate from (and
including) the date on which, but for such deferral, the Optionally Deferred
Payment would otherwise have been due to be made to (but excluding) the
relevant Deferred Interest Satisfaction Date.

 

(h)           Conditions of Payment.

 

(i)            Before
the Company becomes subject to Capital Adequacy Regulations, any Payment
relating to either series of the Capital Securities (or use of the proceeds of
the issue of Common Shares in accordance with the Alternative Interest
Satisfaction Mechanism described herein) shall be made only if the Company is
Solvent at the time of payment (or at the time of using the proceeds of the
issue of such Common Shares). The Company shall make no Payment relating to any
series of the Capital Securities (nor use any proceeds of the issue of Common
Shares in accordance with the Alternative Interest Satisfaction Mechanism)
unless the Company would still be Solvent immediately after such Payment (or
use of the proceeds of such Common Shares). The Company’s redemption or
purchase of any series of the Capital Securities constitutes a payment that is
subject to this condition.

 

(ii)           After
the Company becomes subject to Capital Adequacy Regulations, any Payment
relating to either series of the Capital Securities (or use of the proceeds of
the issue of Common Shares in accordance with the Alternative Interest
Satisfaction Mechanism) shall be made only if the Company is not subject to a
Regulatory Event at the time of payment (or at the time of using the proceeds
of the issue of such Common Shares). The Company shall make no Payment relating
to any such series of the Capital Securities (nor use any proceeds of the issue
of Common Shares in accordance with the Alternative Interest Satisfaction
Mechanism) unless it is not subject to a Regulatory Event and could make the
Payment (or use of the proceeds of such Common Shares) and still not be subject
to a Regulatory Event thereafter. The Company’s redemption or purchase of either
series of the Capital Securities constitutes a payment that is subject to this
condition.

 

(iii)          Winding-Up
Claim

 

A Winding-Up Claim shall be
payable by the Company in its winding-up (faillissement
or vereffening na ontbinding) as
provided in Section 10.1.

 

13

 

(iv)          Set-Off

 

By purchasing Capital
Securities the holders of Capital Securities and the Trustee will be deemed to
have waived any right of set-off, counterclaim or combination of accounts with
respect to the Capital Securities or the Indenture (or between the Company’s
obligations regarding the Capital Securities and any liability owed by a holder
or the Trustee to the Company) that the holders of Capital Securities or the
Trustee might otherwise have against the Company. Each holder will, by virtue
of holding any Capital Security, be deemed to have waived all such rights of
set-off.

 

(i)            Deferral Notice.

 

The Company shall
give a Deferral Notice in the case of a Required Deferral Condition and may
give a Deferral Notice, in its sole discretion and for any reason, in the case
of an Optionally Deferred Payment, except that any such Deferral Notice as to a
payment required to be paid pursuant to a Mandatory Payment Event or Mandatory
Partial Payment Event pursuant to Section 2.5(a) below shall have no
force or effect.

 

2.5          Mandatory Payment
Events; Mandatory Partial Payment Events

 

The Company shall
make payments on each series of the Capital Securities in the following
circumstances:

 

(a)           If a
Mandatory Payment Event or Mandatory Partial Payment Event occurs then all
Mandatorily Deferred Payments and Optionally Deferred Payments on each series
of the Capital Securities shall become mandatorily due and payable in full on
the date of the event, notwithstanding any further Deferral Notice or an
occurrence or continuance of a Required Deferral Condition.  Notwithstanding any provision to the contrary
herein, the Company shall only satisfy its obligations to pay such Mandatorily
Deferred Payments and Optionally Deferred Payments in accordance with the
provisions of the Alternative Interest Satisfaction Mechanism.  The Company shall promptly notify the Trustee
and the Calculation Agent of the occurrence of any Mandatory Payment Event or
Mandatory Partial Payment Event.

 

(b)           If a
Mandatory Payment Event occurs, then the Interest Payments payable on the next
four consecutive Interest Payment Dates, the next two consecutive Interest
Payment Dates or the next Interest Payment Date, as the case may be, on each
series of the Capital Securities, following the Mandatory Payment Event,
depending on whether the Junior Security, the Parity Security or the security
benefiting from a Junior Guarantee or a Parity Guarantee pays dividends or
income distributions on an annual basis, a semi-annual basis or a quarterly
basis, as the case may be, shall be mandatorily due and payable in full on the
relevant Interest Payment Dates with respect to such series. The Company may,
but shall not be required, to satisfy its obligation to make the Interest
Payment payable on such Interest Payment Date in accordance with the
Alternative Interest Satisfaction Mechanism.

 

A Mandatory Payment Event occurs if:

 

(i)            the
Company declares, pays or distributes a dividend or makes a payment (other than
a dividend in the form of Common Shares) on any of its Junior Securities or
makes a payment on a Junior Guarantee;

 

14

 

(ii)           any
of the Company’s subsidiaries or Undertakings, declares, pays or distributes a
dividend on any security issued by it benefiting from a Junior Guarantee or
makes a payment (other than a dividend in the form of Common Shares) on any
security issued by it benefiting from a Junior Guarantee;

 

(iii)          the
Company or any of its subsidiaries or Undertakings redeems, purchases or
otherwise acquires for any consideration any of the Company’s Junior
Securities, Parity Securities or securities issued by any of its subsidiaries
or Undertakings benefiting from a Junior Guarantee or Parity Guarantee, other
than:

 

(A)          by
conversion into or in exchange for its Common Shares;

 

(B)           in
connection with transactions effected by or for the account of its customers or
customers of any of its subsidiaries or in connection with the distribution,
trading or market making activities in respect of those securities;

 

(C)           in
connection with its satisfaction of the Company’s, or the satisfaction by any subsidiary
of the Company of its obligations under any of the Company’s or any subsidiary
of the Company’s employee benefit plans or similar arrangements with or for the
benefit of employees, officers, directors or consultants of the Company or any
of its subsidiaries;

 

(D)          as a
result of a reclassification of the Company or any of its subsidiaries or the
exchange or conversion of one class or series of capital stock for another
class or series of capital stock; or

 

(E)           the
purchase of fractional interests in shares of the Company’s capital stock or
the capital stock of any of its subsidiaries pursuant to the conversion or
exchange provisions of that capital stock (or the security being converted or
exchanged); or

 

(iv)          any
moneys are paid to or made available for a sinking fund or for redemption of
any Junior Securities, Parity Securities or any securities issued by any of its
subsidiaries or Undertakings benefiting from a Junior Guarantee or Parity
Guarantee;

 

in all such cases described
in (i) through (iv) above, except where it concerns a payment,
purchase or redemption that the Company is obliged to make pursuant to its
Articles of Association as they read prior to the relevant deferral or equity
swap, forward, repo or equity derivative transactions it concludes prior to the
relevant deferral.

 

(c)           If a
Mandatory Partial Payment Event occurs, then Mandatory Partial Payments shall
be mandatorily due and payable in respect of each Capital Security of each
series. Such Mandatory Partial Payments will be payable on the next four
consecutive Interest Payment Dates, the next two consecutive Interest Payment
Dates or the next Interest Payment Date, as the case may be, on each series of
the Capital Securities, after the occurrence of such Mandatory Partial Payment
Event, depending on whether the Parity Securities pay dividends or income
distributions on an annual basis, a semi-annual basis or a quarterly basis, as
the case may be. The Company may, but will not be required to, satisfy its
obligation to pay any Mandatory Partial Payments in accordance with the
Alternative Interest Satisfaction Mechanism.

 

15

 

A Mandatory Partial Payment Event occurs if:

 

(i)            the
Company declares, pays or distributes a dividend or makes a payment on any of
its Parity Securities or makes any payment on any of its Parity Guarantees
(except where it concerns a payment, purchase or redemption that the Company is
obliged to make pursuant to its Articles of Association as they read prior to
the relevant deferral or equity swap, forward, repo or equity derivative
transactions concluded by the Company prior to the relevant deferral); or

 

(ii)           any of
its subsidiaries or Undertakings declares, pays or distributes a dividend on
any security issued by it benefiting from a Parity Guarantee or makes a payment
on any security issued by it benefiting from a Parity Guarantee.

 

3.             REDEMPTION AND PURCHASES

 

3.1          General

 

Any redemption
made in accordance with this Article 3 shall be made in accordance with Section 1102
and Sections 1104 through Section 1106 of the Base Indenture.

 

3.2          Optional
Redemption

 

Subject to Section 2.4(h),
the Company may redeem each series of the Capital Securities in whole (but not
in part) at its option, on December 15, 2010, or on any Interest Payment
Date thereafter at their aggregate principal amount together with Outstanding
Payments due through the date of redemption, the Base Redemption Price. 
Neither series of Capital Securities is redeemable at the option of the
holder of a Capital Security at any time.

 

3.3          Redemption for
Tax Reasons

 

(a)           The
Company may, by giving notice of redemption, redeem in whole (but not in part) each
series of the Capital Securities at their Base Redemption Price if a Tax Event
occurs. A Tax Event will occur if the Company
determines that immediately prior to the giving of the notice referred to
below, on the next Interest Payment Date with respect to such series of Capital
Securities, any of the following would occur or be occurring.

 

(i)            The
Company would, for reasons outside its control, be unable to make such payment on
such series without being required to pay Additional Amounts and the Company cannot
avoid the requirement or circumstance by taking measures as it (acting in good
faith) deems appropriate.

 

(ii)           Payments
of amounts in respect of interest on such series of the Capital Securities,
including, for the avoidance of doubt, the issue of Common Shares pursuant to
the Alternative Interest Satisfaction Mechanism, may be treated as “distributions”
within the meaning of Section II of the Dividend Withholding Tax Act 1965
(Wet op de dividendbelasting 1965; or
such other provision as may from time to time supersede or replace Section II
of the Dividend Withholding Tax Act 1965 for the purposes of such definition)
and the Company cannot avoid the requirement or circumstance by taking such
measures as it (acting in good faith) deems appropriate.

 

16

 

(iii)          As a
result of any proposed change or amendment to the laws of the Netherlands, or
any proposed change in the application of official or generally published
interpretation of such laws, or any interpretation or pronouncement by any
relevant tax authority that provides for a position with respect to such law or
regulations that differs from the previously generally accepted position in
relation to similar transactions or which differs from any specific written
confirmation given by a tax authority in respect of such series of the Capital
Securities, which change or amendment becomes, or would become, effective, or
in the case of a change or proposed change in law if such change is enacted
(or, in the case of a proposed change, is expected to be enacted) by Act of
Parliament or made by Statutory Instrument on or after November 17, 2005,
there is more than an insubstantial risk that the Company will not obtain
substantially full relief for the purposes of Dutch corporation tax for any
payment of interest including, for the avoidance of doubt, where the payment of
interest is to be satisfied by the issue of Common Shares pursuant to the
Alternative Interest Satisfaction Mechanism and it cannot avoid this risk by
taking such measures as it (acting in good faith) deems appropriate.

 

(b)           Upon
the occurrence of a Tax Event, the Company is required, before it gives a
notice of redemption in accordance with Section 3.5, to deliver to the
Trustee a written legal opinion of independent Netherlands counsel of
recognized standing, selected by the Company, in a form satisfactory to the
Trustee confirming that such Tax Event has occurred. The Trustee will accept
such opinion as sufficient evidence of the conditions set out above, in which
event it will be conclusive and binding on the holders of Capital Securities.

 

3.4          Redemption or
Conversion for Regulatory Reasons

 

If, at any time
after the Company becomes subject to Capital Adequacy Regulations, the relevant
regulator has determined that securities of the nature of either series of the
Capital Securities cannot qualify as “own funds” or “core capital” (Tier 1
capital or equivalent) for the purposes of determination of such Capital
Adequacy Regulations, then:

 

(a)           the
Company may at any time, by giving notice of redemption, redeem in whole (but
not in part) such series of the Capital Securities at its Base Redemption
Price; or

 

(b)           subject
to compliance with applicable regulatory requirements, the Company may at any
time convert or exchange such series of the Capital Securities in whole (but
not in part) to another series of its capital securities having materially the
same terms as such series of the Capital Securities and which are no less favorable to the holders than the current terms of
such series of the Capital Securities. Any conversion of such series of the
Capital Securities into another series of capital securities as described
herein will be made on not less than 30 nor more than 60 days’ notice before
the applicable conversion date to the holders of the relevant series of the
Capital Securities and the Trustee. The Company is permitted to satisfy its
obligation to pay any Mandatorily Deferred Payment or Optionally Deferred
Payment due upon conversion only in accordance with the Alternative Interest
Satisfaction Mechanism pursuant to Article 4.

 

3.5          Notice of
Redemption

 

Before the
Company may redeem any series of the Capital Securities, it must give not less
than 30 nor more than 60 days’ notice before the applicable redemption date to
the Trustee and holders thereof. Any notice of redemption is irrevocable and
must be given in accordance with Sections 1102 and 1104 of the

 

17

 

Base
Indenture.  If the redemption price in
respect of the Capital Securities of the series to be redeemed is improperly
withheld or refused and is not paid by the Company, interest on such Capital
Securities will continue to be payable until the redemption price is actually
paid.

 

3.6          Purchases

 

The Company may
purchase on the open market at any time Capital Securities in any manner and at
any price. Purchased Securities may be held, resold or, at its option,
cancelled, as provided in Section 3.7.

 

3.7          Cancellation

 

Cancellation of
any Capital Securities so redeemed by the Company will be effected by reducing
the principal amount of the relevant Global Securities, and any Capital
Securities so cancelled may not be reissued or resold and the Company’s
obligations in respect of any such cancelled Capital Securities will be
discharged.

 

4.             ALTERNATIVE INTEREST SATISFACTION
MECHANISM

 

4.1          General

 

The Company shall
satisfy any Mandatorily Deferred Payments and any Optionally Deferred Payments
(with any interest accrued thereon, as applicable) on either series of the
Capital Securities using proceeds raised by the Alternative
Interest Satisfaction Mechanism. 
In addition, the Company may elect at any time to satisfy its obligation
to make any Payment (other than Deferred Payments and a payment of principal)
in respect of either series of the Capital Securities to holders of the
relevant series of the Capital Securities by using the Alternative Interest
Satisfaction Mechanism.

 

4.2          Notice of
Exercise of Alternative Interest Satisfaction Mechanism

 

If the Company
uses the Alternative Interest Satisfaction Mechanism, it will notify the
Trustee and, in the case of the Floating Rate Securities, also the Calculation
Agent, not less than 16 Business Days prior to the relevant Interest Payment
Date for the applicable series.

 

4.3          Issue of Common
Shares

 

If the Company
satisfies any Payment in accordance with the Alternative Interest Satisfaction
Mechanism then, subject to the conditions in Sections 4.5 and 4.6, the
following shall occur.

 

(a)           By
close of business on or before the seventh Business Day prior to the relevant
Interest Payment Date or Deferred Interest Satisfaction Date the Company shall
have authorized for issue such number of Common Shares as, in its
determination, have a market value (after conversion from euro into U.S.
dollars, if applicable) of not less than the relevant Payment to be satisfied.

 

(b)           The
Company shall procure purchasers for such Common Shares as soon as possible
after the above mentioned authorization for the issue of Common Shares, but not
later than the fourth Business Day prior to the Relevant Date.

 

(c)           If,
after the operation of the above procedures, there would, in the Company’s
opinion, be a shortfall on the date on which the relevant Payment is due, the
Company shall issue further

 

18

 

Common Shares in accordance
with the provisions of this Indenture to ensure that a sum at least equal to
the relevant Payment is available to make the Payment in full on the relevant
due date, provided that if, despite these efforts, such a shortfall exists on
the relevant due date the Company shall continue to issue Common Shares until
the Trustee shall have received funds equal to the full amount of such
shortfall.

 

4.4          Receipt of Cash
Proceeds in Respect of Issue of Common Shares to be Used to Satisfy Payment

 

If the Company
elects or if it is required to make a Payment hereunder by using the proceeds
of an issue of Common Shares, and, in accordance with its obligations, the
Company issues such Common Shares under this Indenture, the Company shall sell
such Common Shares in the market. Subject to Section 2.4(h), the cash
proceeds the Company receives on the sale of the Common Shares in the market
will be used to satisfy the relevant Payment or, as the case may be, the
relevant part of such Payment. The Company will transfer the cash proceeds (or
such amount of cash proceeds as is necessary (after conversion from euro to
U.S. dollars) to make the relevant Payment) to the Paying Agent on the Business
Day preceding the relevant payment date for payment by the Paying Agent, on the
relevant payment date, towards the relevant Payments to be satisfied.  The Paying Agent shall pay to the holders of
the applicable series of Capital Securities the proceeds of the sale of Common
Shares in respect of the relevant Payment.

 

4.5          Reservation and
Insufficiency of Common Shares

 

(a)           The
Company shall keep available for issue enough Common Shares as it reasonably
considers would be required to satisfy from time to time the next year’s
scheduled Interest Payments and any Mandatorily Deferred Payments or Optionally
Deferred Payments on each series of the Capital Securities. No damages will be
payable for breach of this covenant but, if the Company breaches this
requirement, the Trustee may require that the Company holds, as soon as
practicable, an extraordinary general meeting of its shareholders at which the
Company shall seek a resolution to remedy the breach. The Trustee is not
obligated to monitor the Company’s compliance with this Section 4.5(a) and
is entitled to assume, unless a Responsible Officer of the Trustee has actual
knowledge to the contrary, that the Company is complying with its obligations
under this Section 4.5(a).

 

(b)           (i)            If the Company is to satisfy
a Payment pursuant to the Alternative Interest Satisfaction Mechanism and it
does not, on the date when the number of Common Shares required to be issued is
determined, have a sufficient number of Common Shares available for issue, then
it shall promptly notify the Trustee and the holders of the relevant series of
the Capital Securities and, in the case of the Floating Rate Securities, also
the Calculation Agent, that all or part, as the case may be, of the relevant
Payment cannot be so satisfied due to the insufficient number of authorized
Common Shares.

 

(ii)           Upon
the occurrence of the circumstances contemplated in Section 4.5(b)(i), the
Payment or part thereof shall be satisfied following the date of the next
annual general meeting or extraordinary general meeting of the Company’s
shareholders at which a resolution is passed making a sufficient number of
Common Shares available to satisfy all or such part of the relevant Payment.

 

(iii)          However,
if the number of Common Shares authorized to be issued at any such meeting
contemplated by Section 4.5(b)(ii) is insufficient to satisfy all or
such part of the

 

19

 

relevant Payment then the Company will apply the proceeds of those
Common Shares so issued in partial satisfaction of all or such part of the
relevant Payment.

 

(c)           Following
the passage of any such resolution, the Company shall notify the Trustee and
the holders of the relevant series of the Capital Securities and, in the case
of the Floating Rate Securities, also the Calculation Agent of the date upon
which the relevant Payment or, as the case may be, the part thereof is to be
made on not less than 16 Business Days’ notice and the Trustee shall provide
notice to the Company of the amount of Accrued Interest Payments, if any,
payable in connection with such Payment.

 

(d)           The
relevant Payment or part thereof that is not so satisfied will, unless it is a
Mandatorily Deferred Payment that had been deferred as provided in Sections 2.4(e) or
2.4(f) and has not subsequently been satisfied or deferred in accordance
with an optional deferral as provided in Section 2.4(g), continue to
accrue interest from (and including) the date on which Payment would otherwise
have been due to (but excluding) the date on which such Payment or part thereof
is satisfied or, in the event of a Market Disruption Event, the date on which
such Payment or part thereof would, but for the occurrence of such Market
Disruption Event, have been satisfied (from which date interest (if any) will
accrue on such Payment in accordance with Section 4.6) at the Interest
Rate.

 

(e)           If,
in the case of an insufficiency of Common Shares, the Company does not hold an
annual general meeting within six months of giving the notice set forth in Section 4.5(b)(i),
at which a resolution to make a sufficient number of Common Shares so available
is proposed, the Trustee will by notice require the Company to convene an
extraordinary general meeting at which such a resolution will be proposed, on a
date falling within 10 weeks of such notice from the Trustee.

 

(f)            In
the event that any such resolution proposed at any such annual general meeting
or extraordinary general meeting is rejected, such resolution will be proposed
at each annual general meeting or any extraordinary general meeting thereafter
until such time as such resolution has been passed by the Company’s
shareholders.

 

4.6          Market Disruption

 

(a)           Notwithstanding
the provisions of Section 4.3 if, in the Company’s opinion, a Market
Disruption Event exists on or after the 15th Business Day preceding any date
upon which a payment or part thereof is due to be made or satisfied with
respect to any series of the Capital Securities using the Alternative Interest
Satisfaction Mechanism, then the Company may give notice to the Trustee and the
holders of the relevant series of the Capital Securities and, in the case of
the Floating Rate Securities, also to the Calculation Agent, as soon as
possible after the Market Disruption Event has arisen or occurred, whereupon
the relevant payment will be deferred until such time as, in the Company’s
opinion, the Market Disruption Event no longer exists.

 

(b)           Any
such deferred payment or part thereof will be satisfied as soon as practicable
after the Market Disruption Event no longer exists. The Company shall notify
the Trustee of the date on which such deferred Payment or part thereof will be
satisfied and the Trustee shall provide notice to the Company of the amount of
any Accrued Interest Payments, if any, payable in connection with such deferred
payment.  The Company shall then notify
the Paying Agent and the holders of the relevant series of the Capital
Securities and, in the case of the Floating Rate Securities, also the
Calculation Agent, in accordance with Section 106 of the Base Indenture of

 

20

 

the date on which such
deferred payment or part thereof will be satisfied and the amount of any
Accrued Interest Payments, if any, payable in connection with such deferred
payment.

 

(c)           Except
as provided in the next sentence, interest will not accrue on such deferred
payment or part thereof, however, during a Market Disruption Event. If the
Company does not make the relevant payment or part thereof for a period of 14
days or more after its due date, even if the Market Disruption Event is
continuing, interest will accrue on such deferred payment or part thereof from
(and including) the date on which the relevant payment or part thereof was due
to be made to (but excluding) the date on which such payment or part thereof is
made. Any such interest shall accrue at the Interest Rate and shall be
satisfied only in accordance with the Alternative Interest Satisfaction
Mechanism pursuant to this Article 4 and as soon as reasonably practicable
after the relevant deferred payment is made. No liability will attach to the
Trustee or its agents if, as a result of a Market Disruption Event or any other
event outside the control of the Trustee or any such agent, the Trustee or any
such agent is unable to comply with its duties in connection with any payment
made pursuant to the Alternative Interest Satisfaction Mechanism.

 

4.7          Certification to
Trustee

 

The Company shall
certify to the Trustee that the proceeds used to make any Mandatorily Deferred
Payments or Optionally Deferred Payments with respect to any series of the
Capital Securities have been funded through the issue of Common Shares that
will provide the cash amount due in respect of the Mandatorily Deferred
Payments or Optionally Deferred Payments.

 

5.             REMEDIES

 

5.1          Defaults;
Collection of Indebtedness and Suits for Enforcement by Trustee

 

(a)           Payment Default, whenever used herein with
respect to any series of the Capital Securities, means solely the following
event (regardless of the reason for the Payment Default and whether it is
voluntary, involuntary or is effected by operation of law pursuant to any
judgment, decree or order of any court or any order, rule or regulation of
any administrative or governmental body):

 

the Company fails
to pay or set aside for payment the amount due to satisfy any payment on such
series of the Capital Securities when due, and such failure continues for 14
days; provided that a Payment Event shall not constitute a Payment Default.

 

(b)           If a
Payment Default occurs and is continuing with respect to a series of the
Capital Securities, the Trustee may pursue all legal remedies available to it
including judicial proceedings in the Netherlands (but not elsewhere) for the
collection of the sums due and unpaid on such series of Capital Securities or
its winding-up (faillissement or vereffening na ontbinding), but the
Trustee may not declare the principal amount of any outstanding Capital
Security of such series to be due and payable.

 

(c)           A Payment Event (and not a Payment Default)
shall occur if at the end of the 14-day period set forth in Section 5.1(a) the
Company fails to make such payment as a result of the existence of a Required
Deferral Condition.

 

21

 

If a Payment
Event occurs and is continuing, the Trustee may institute winding-up
proceedings (faillissement or vereffening na ontbinding) exclusively in
the Netherlands, but may not pursue any other legal remedy, including a
judicial proceeding for the collection of the sums due and unpaid.

 

(d)                                 In the case of a
Mandatory Payment Event or Mandatory Partial Payment Event, requiring payment
of Interest on a succeeding Interest Payment Date with respect to a series of
the Capital Securities, if the Company fails to make such mandatory payment of
Interest as a result of:

 

(i)                                     the existence of
a Required Deferral Condition; or

 

(ii)                                  a deferral of an
Interest Payment as permitted under the terms of the Indenture,

 

the relevant
Interest Payment due on such series of the Capital Securities shall constitute
an Outstanding Payment and will accumulate with any other Outstanding Payments
until paid and will constitute neither a Payment Default nor a Payment Event.

 

(e)                                  Subject to the
provisions of this Section 5.1, and without prejudice to Sections 504 and
505 of the Base Indenture, the Trustee may at its discretion and without
further notice institute such proceedings against the Company as it may think
fit to enforce any term or condition binding on the Company under the
Indenture, the applicable series of the Capital Securities (other than for the
payment of any principal or satisfaction of any Payments in respect of such
series of Capital Securities); provided that the Company will not by virtue of
the institution of any such proceedings be obliged to pay any sum or sums, in
cash or otherwise, sooner than it would otherwise have been obligated to pay.

 

(f)                                    The Trustee shall
not be bound to take any of the foregoing actions against the Company to
enforce the terms of this Indenture or any series of the Capital Securities
unless (i) it will have been so requested by an extraordinary resolution
or in writing by the holders of at least 25% in principal amount of such series
of the Capital Securities then outstanding and (ii) it will have been
offered reasonable security or indemnity satisfactory to it against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request.

 

(g)                                 Notwithstanding
the foregoing, holders of each series of the Capital Securities have the
absolute and unconditional right to institute suit for the enforcement of any
payment on their Capital Securities when due in accordance with Section 508
of the Base Indenture and such right may not be impaired without the consent of
the holder.

 

(h)                                 Without prejudice
to Sections 504 and 505 of the Base Indenture, the Trustee is and shall be
fully authorized by each and any holder of record of a Capital Security of each
series to commence winding-up proceedings (faillissement
or vereffening na ontbinding)
in the Netherlands.

 

(i)                                     Notwithstanding
the foregoing, the right to institute winding-up proceedings (faillissement or vereffening na ontbinding) is limited to
circumstances where payment has become due.

 

(j)                                     Sections 501, 502
and 503 of the Base Indenture shall not apply with respect to any series of the
Capital Securities.

 

22

 

6.                                      SUBORDINATION

 

6.1                               Agreement
to Subordinate

 

The Company
covenants and agrees, and each holder of a series of the Capital Securities
issued hereunder, by such holder’s acceptance thereof, likewise covenants and
agrees, that such series of the Capital Securities issued hereunder (i)(A) shall
rank pari passu with respect to each other, (B) shall be similarly
subordinated as, and accordingly rank pari passu with, the Existing Capital
Securities and (C) shall rank pari passu with other Parity Securities,
Parity Guarantees and other debt obligations expressed to be similarly
subordinated as and, accordingly, ranking pari passu with, such series of the
Capital Securities, such other Parity Guarantees and Parity Securities, (ii) are
and shall be subordinated (achtergesteld),
and accordingly be subject in right of payment to prior payment in full upon
liquidation, moratorium of payments or bankruptcy of the Company, to the claims
of Senior Creditors, present and future, and (iii) shall rank in priority
to any Junior Securities and Junior Guarantees.

 

6.2                               Section 1401
of the Base Indenture

 

With respect to each
series of the Capital Securities, the provisions of Section 6.1 replace in
their entirety Section 1402 of the Base Indenture. In addition, with
respect to each series of the Capital Securities, Section 1402 through Section 1416
of Article Fourteen of the Base Indenture is hereby amended by replacing
the term “Senior Debt” as used in such sections with the term “Senior Debt” as
defined in this Third Supplemental Indenture.

 

7.                                      COVENANTS OF THE COMPANY

 

7.1                               Mandatory
Interest Payments

 

Subject to the
existence of a Required Deferral Condition, the Company agrees that it will not
defer any payment required to be paid as a result of a Mandatory Payment Event
or Mandatory Partial Payment Event (as contemplated by Section 2.5(a) only)
on any series of the Capital Securities.

 

7.2                               Sufficiency
of Shares

 

(a)                                  The Company
agrees to keep available for issue enough Common Shares as it reasonably
considers would be required to satisfy from time to time the next year’s
scheduled Interest Payments and any Mandatorily Deferred Payments or Optionally
Deferred Payments on each series of the Capital Securities. No damages will be
payable for breach of this covenant but, if the Company breaches this
requirement, the Trustee may require that the Company holds, as soon as
practicable, an extraordinary general meeting of its shareholders at which the
Company shall seek a resolution to remedy the breach.

 

(b)                                 The Trustee is
not obligated to monitor the Company’s compliance with this Section 7.2(a) and
is entitled to assume, unless a Responsible Officer of the Trustee has actual
knowledge to the contrary, that the Company is complying with its obligations
under this Section 7.2(a).

 

7.3                               Payment
of Proceeds from Sale of Common Shares in Connection with the Alternative
Interest Satisfaction Mechanism

 

The Company
agrees that immediately on receipt of the proceeds of the sale of Common Shares
in connection with the Alternative Interest Satisfaction Mechanism, it shall
pay proceeds from the sale of

 

23

 

such Common
Shares to the Paying Agent, either in Euros or converted into U.S. dollars, in
such amount as shall enable the Paying Agent to make the relevant Payment in
full on the relevant Interest Payment Date or Deferred Interest Satisfaction
Date.

 

7.4                               Listing

 

The Company will
use reasonable efforts to maintain the listing of each series of the Capital
Securities on the stock exchange on which it was listed on or about the Issue
Date or, if it is unable to do so having used such efforts or if the
maintenance of any such listing is agreed by the Trustee to be unduly
burdensome, use all reasonable efforts to obtain and maintain a quotation or
listing of each series of Capital Securities on such other stock exchange or
exchanges or securities market or markets as the Company may (with the prior
written approval of the Trustee) decide so that each series of the Capital
Securities is listed on at least one stock exchange or securities market.

 

7.5                               Officer’s
Certificate on Deferral

 

If the Company
elects or is obliged to defer any Payment in accordance with Section 2.4
on any series of the Capital Securities, it shall deliver to the Trustee, no
later than the sixteenth Business Day prior to the relevant Interest Payment
Date on such series, an Officer’s Certificate, certifying that the Required
Deferral Condition was met on the 20th Business Day prior to the relevant
Interest Payment Date and if the Company shall elect to satisfy a deferred
Interest Payment on an earlier date than the Interest Payment Date following
that on which the Required Deferral Condition fails to be met, deliver to the
Trustee not later than the sixteenth Business Day prior to making such payment
an Officer’s Certificate certifying that the Required Deferral Condition was no
longer, on a date no more than 16 Business Days prior to the delivery of such
certificate, met.

 

7.6                               Officer’s
Certificate on Market Disruption Event

 

If, in the
opinion of the Company, there exists a Market Disruption Event as a consequence
of which a Payment may be deferred under Section 4.6, it shall deliver to
the Trustee within two Business Days of such Market Disruption Event having
arisen or the Company having become aware of the same, an Officer’s Certificate
specifying the details of such Market Disruption Event.

 

8.                                      FORM OF CAPITAL SECURITIES

 

8.1                               Form of
Capital Securities

 

The Fixed Rate
Securities shall be substantially in the form of Schedule 1 hereto. The
Floating Rate Securities shall be substantially in the form of Schedule 2
hereto. Schedules 1 and 2 hereto are hereby incorporated into and expressly
made a part of this Third Supplemental Indenture.

 

9.                                      ORIGINAL ISSUE OF CAPITAL SECURITIES

 

9.1                               Original
Issue of Capital Securities

 

Fixed Rate
Securities in the initial aggregate principal amount of up to $550,000,000 and
Floating Rate Securities in the initial aggregate principal amount of up to
$275,000,000 may, upon execution of this Third Supplemental Indenture, be
executed by the Company and delivered to the Trustee for authentication, and
the Trustee shall thereupon authenticate and deliver such Capital Securities to
or upon the written order of the Company, in accordance with Section 303
of the Base Indenture.

 

24

 

There is no limit
on the amount of Capital Securities of any series which may be issued
subsequent to this Third Supplemental Indenture.

 

10.                               WINDING UP

 

10.1                        Winding-Up

 

If at any time an
order is made, or an effective resolution is passed, for the Company’s
winding-up (faillissement or vereffening na ontbinding) (except in any
such case a solvent winding-up solely for the purpose of a reconstruction,
amalgamation or the substitution of a successor in business, the terms of which
reconstruction, amalgamation or substitution have previously been approved in
writing by the Trustee or by an extraordinary resolution of the Company’s
shareholders), the Company will pay the holders of each series of Capital
Securities in respect of each such Capital Security (in lieu of any other
payment by the Company) a winding-up amount. Each series of the Capital
Securities will rank on the Company’s winding-up (faillissement or vereffening
na ontbinding) in priority to distributions on Junior Securities,
Junior Guarantees and all classes of the Company’s share capital and will rank
equally with each other and among themselves and will rank equally with any
Parity Securities and Parity Guarantees, including the Company’s Existing
Capital Securities, then outstanding, but will be subordinated in right of
payment to the prior payment in full of the claims of the Company’s Senior
Creditors, present and future.

 

11.                               SATISFACTION AND DISCHARGE

 

11.1                        Satisfaction
and Discharge

 

The Company
covenants and agrees, and each holder of Capital Securities issued hereunder,
by such holder’s acceptance thereof, likewise covenants and agrees, that all
Capital Securities shall be issued as Securities subject to the provisions of Article 4
of the Base Indenture.

 

12.                               TAXATION; ADDITIONAL AMOUNTS

 

12.1                        General

 

Any amounts to be
paid by the Company on any series of the Capital Securities (including
principal, Interest Amounts, Mandatorily Deferred Payments or Optionally
Deferred Payments, Mandatory Partial Payments, Accrued Interest Payments and
Winding-Up Claims) shall be made without withholding of or deduction for any
present or future taxes, duties, assessments or other charges imposed by the
government of the Netherlands or the government of a jurisdiction in which a
successor to the Company is organized, unless the withholding or deduction of
such taxes, duties, assessments or charges is required by law. In that event,
the Company will pay such additional amounts (Additional
Amounts), as may be necessary in order that the net amounts received
by holders of the relevant series of Capital Securities after such withholding
or deduction equal the respective amounts of principal and interest which would
have been received in respect of such Capital Securities in the absence of such
withholding or deduction, except that no such Additional Amounts shall be
payable in relation to any payment with respect to any Capital Security:

 

(a)                                  to,
or to a third party on behalf of, a holder who is liable to such taxes, duties,
assessments or governmental charges in respect of such Capital Security by
reason of such holder having some connection with the Netherlands other than
the mere holding of such Capital Security; or

 

25

 

(b)                                 to,
or to a third party on behalf of, a holder, if such withholding or deduction
may be avoided by complying with any statutory requirement or by making a
declaration of non-residence or other similar claim for exemption to the
relevant tax authority; or

 

(c)                                  to,
or to a third party on behalf of, a holder, that is a partnership, or a holder,
that is not the sole beneficial owner of the Capital Security or which holds
the Capital Security in a fiduciary capacity, to the extent that any of the
members of the partnership, the beneficial owner or the settler or beneficiary
with respect to the fiduciary would not have been entitled to the payment of an
Additional Amount had each of the members of the partnership, the beneficial
owner, settler or beneficiary, as the case may be, received directly his
beneficial or distributive share of the payment; or

 

(d)                                 presented
for payment (where presentation is required) more than 30 days after the
Relevant Date except to the extent that the holder would have been entitled to
such Additional Amounts on presenting the same for payment on the last day of
such period of 30 days; or

 

(e)                                  where
such withholding or deduction is imposed on a payment to an individual and is
required to be made pursuant to the European Union Council Directive of June 3,
2003 on the taxation of savings income, implementing the conclusions of the
ECOFIN Council meeting of November 26-27, 2000 or any law implementing or
complying with, or introduced in order to conform to such Directive, or similar
measures adopted by a number of third countries and territories.

 

In the event that
any payment is satisfied through the Alternative Interest Satisfaction
Mechanism, then any Additional Amounts that are payable must also be satisfied
through the issue of Common Shares.

 

References herein
to principal, Interest Amounts, Mandatorily deferred Payments, Optionally
Deferred Payments, Mandatory Partial Payments or Accrued Interest Payments
shall be deemed to include any Additional Amounts that may be payable, if
applicable.

 

12.2                        Section 1006
of the Base Indenture

 

The provisions of
Section 1006 of the Base Indenture are hereby replaced by Section 12.1
hereof and shall not apply with respect to either series of the Capital
Securities.

 

13.                               MISCELLANEOUS

 

13.1                        Issuance
of Definitive Securities

 

(a)                                  So long as DTC
holds the Global Securities, the Global Securities will not be exchangeable for
definitive Securities of the applicable series of the Capital Securities
unless: (i) DTC notifies the Trustee that it is unwilling or unable to
continue to hold the book-entry Capital Securities or DTC ceases to be a
clearing agency registered under the Exchange Act and the Trustee does not
appoint a successor to DTC which is registered under the Exchange Act within
120 days; (ii) a Payment Default relating to such series has occurred and
is continuing; (iii) a Payment Event relating to such series has occurred;
(iv) in the event of the Company’s winding-up (faillissement or vereffening
na ontbinding) it fails to make a payment on the relevant series of
the Capital Securities when due; or (v) at any time following a
determination by the Company in its sole discretion that the Global Securities
representing any series of the Capital Securities should be exchanged for
definitive Securities of such series in registered form.

 

26

 

(b)                                 Each person
having an ownership or other interest in the Capital Securities must rely
exclusively on the rules and procedures of DTC or any participant therein,
as the case may be, and any agreement with any participant of DTC or any participant
therein, as the case may be, or any other securities intermediary through which
that person holds its interest to receive or direct the delivery of possession
of any definitive security.

 

(c)                                  Any definitive
Securities will be issued in registered form only in denominations of $25.00
and any integral multiples thereof and shall be substantially in the form of
the Global Security included as (i) Schedule 1 hereto in respect of
Fixed Securities and (ii) Schedule 2 hereto in respect of Floating
Rate Securities, with such insertions, omissions, substitutions and other
variations as appropriate for definitive Securities as evidenced by the
execution of such securities. To the extent permitted by law, the Company and
the Trustee are entitled to treat the person in whose name any definitive
Security is registered as its absolute owner.

 

(d)                                 Payments in
respect of each series of definitive Securities will be made to the person in
whose name the definitive Securities are registered as it appears in the
register for that series. Payments will be made in respect of each series of the
Capital Securities by check drawn on a bank in New York or, if the holder
requests, by transfer to the holder’s account in New York. Definitive
Securities must be presented to the Paying Agent for redemption.

 

(e)                                  If the Company
issues definitive Securities in exchange for Global Securities, DTC, as holder
of the Global Securities, will surrender it against receipt of the definitive
Securities for the applicable series, cancel the book-entry securities of that
series and distribute the definitive Securities of that series to the person in
the amounts that DTC specifies.

 

(f)                                    If definitive
Securities are issued in the limited circumstances as set forth above, such
Securities may be transferred in whole or in part in denominations of any whole
number of Securities upon surrender of the definitive Securities certificates
together with the form of transfer endorsed on it, duly completed and executed
at the specified office of the Trustee. If only part of a Securities
certificate is transferred, a new Securities certificate representing the
balance not transferred will be issued to the transferor.

 

13.2                        Ratification
of Base Indenture; Third Supplemental Indenture Controls

 

The Base
Indenture, as supplemented by this Third Supplemental Indenture, is in all
respects ratified and confirmed. This Third Supplemental Indenture shall be
deemed part of the Base Indenture in the manner and to the extent herein and
therein provided. The provisions of this Third Supplemental Indenture shall
supersede the provisions of the Base Indenture to the extent the Base Indenture
is inconsistent herewith with respect to any series of the Capital Securities
and any other series of Capital Securities issued hereunder.

 

13.3                        Trustee
Not Responsible for Recitals

 

The recitals
contained herein are made by the Company and not by the Trustee, and the
Trustee assumes no responsibility for the accuracy thereof. The Trustee makes
no representation as to the validity or sufficiency of this Third Supplemental
Indenture or any series of the Capital Securities. The Trustee shall not be
accountable for the use or application by the Company of any series of the
Capital Securities or the proceeds thereof.

 

27

 

13.4                        Calculation
Agent

 

So long as any of
the Floating Rate Securities are outstanding, the Company will ensure that
there will always be a Calculation Agent. If the Calculation Agent is unable or
unwilling to act as such, or if it fails to make a determination, calculation
or otherwise fails to perform its duties, as appropriate, the Company will
appoint (on terms acceptable to the Trustee) an independent investment bank
acceptable to the Trustee to act as such in its place. Subject to certain
limited exceptions, neither the termination of the appointment of the
Calculation Agent nor the resignation of the Calculation Agent will be
effective without a successor having been appointed.  All calculations and determinations made by
the Calculation Agent in relation to the Floating Rate Securities (except in
the case of manifest error) are final and binding on the Company, the Trustee
and the holders of the Floating Rate Securities.

 

13.5                        Governing
Law

 

This Third
Supplemental Indenture and each series of the Capital Securities shall be
governed by and construed in accordance with the laws of the State of New York,
except for Article 6 and Article 10, to the extent it relates to
subordination, which shall be governed by and construed in accordance with the
laws of the Netherlands.

 

13.6                        Severability

 

If any provision
in the Indenture or in any series of the Capital Securities is determined to be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

 

13.7                        Counterparts

 

The parties may
sign any number of copies of this Third Supplemental Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement. Any signed copy shall be sufficient proof of this Third Supplemental
Indenture.

 

28

 

IN WITNESS
WHEREOF, the parties hereto have caused this Third
Supplemental Indenture to be duly executed as of the day and year first above
written.

 

	
   

  	
  AEGON N.V.

  
	
   

  	
   

  	
  as Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CITIBANK N.A., as Trustee

  
	
   

  	
   

  	
  Paying Agent
  and Calculation Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

29

 

SCHEDULE 1

 

FORM OF 6.50%
PERPETUAL CAPITAL SECURITIES

 

THIS SECURITY IS A GLOBAL
SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT
BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO
TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN
THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

The rights of the holders of
the Securities are, to the extent and in the manner set forth in Section 1402
of the Base Indenture and Article 6 of the Third Supplemental Indenture,
subordinated to Senior Debt, and this Security is issued subject to the
provisions of Article 14 of the Base Indenture and Article 6 of the
Third Supplemental Indenture, and the holder of this Security, by accepting the
same, agrees to and shall be bound by such provisions. The terms of this
paragraph are governed by, and shall be construed in accordance with, the laws
of the Netherlands.

 

AEGON N.V.

 

6.50% Perpetual Capital Securities

 

No.

CUSIP No.:

ISIN No.:

COMMON CODE:

 

AEGON N.V., a corporation
duly organized and existing under the laws of the Netherlands (herein called
the Company, which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to CEDE & Co., or registered assigns,
the principal sum of $                              
(but only at such times as set forth in the Indenture with respect to Optional
Redemption, Redemption for Tax Reasons or Redemption or Conversion for
Regulatory Reasons in Article 3 of the Third Supplemental Indenture) and
to pay interest thereon from November 23, 2005 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, quarterly in
arrears on March 15, June 15, September 15 and December 15
in each year, commencing on March 15, 2006, and at such other times as are
set forth in the Indenture at the rate of 6.50% per annum, until the principal
hereof is paid or made available for payment. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the March 1, June 1,
September 1 or December 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. If interest is required
to be calculated for any period less than a year, it shall be calculated based
on a 360-day year consisting of twelve 30-day months. If any Interest Payment
Date or the redemption date of the Securities falls on a day that is not a
Business Day, the Company shall make the required payment on the next
succeeding Business Day and no additional Interest shall accrue in respect of
the payment made on that next succeeding Business Day.

 

Subject to the immediately
following paragraph, if applicable, any Payment on this Security which is
payable, and is paid or duly provided for, on any Interest Payment Date or on
any date on which the Company makes any Payment (including any payment of
Additional Amounts in accordance with Article 12 of the Third Supplemental
Indenture) shall be paid in U.S. dollars to the registered holder, including
through a Paying Agent

 

S-1

 

by wire-transfer of same-day
funds to the holder or, at the option of the Company, by check mailed to the
address of the holder as it appears in the Company’s Security Register. For so
long as this Security is held in global form, all payments shall be made in
U.S. dollars by wire-transfer of same-day funds.

 

The Company shall under
certain circumstances, and in accordance with the Indenture, defer payments of
interest on this Security. Any interest on this Security which is not paid or
duly provided for on any applicable Interest Payment Date, together with any
other payments in respect of this Security not paid on any date on which such
Payment has become due and payable or would have become due and payable except
that payment is not made as permitted by the Indenture, so long as the same
remains unpaid, shall constitute “Outstanding Payments.” Outstanding Payments
will accumulate until paid and will constitute neither a Payment Default nor a
Payment Event. Outstanding Payments on this Security, when paid, as provided
subject to the conditions in the Indenture, will be paid on the Deferred
Interest Satisfaction Date to the holder in whose name this Security is
registered at the close of business on a Special Record Date for the Payment
due on such Deferred Interest Satisfaction Date to be fixed by the Trustee,
notice of which shall be given to holders of Securities not less than 10 days
prior to such Special Record Date, or be paid in any other lawful manner not
inconsistent with the requirements of any securities exchange on which this Security
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in the Indenture.

 

Outstanding Payments, other
than certain Accrued Interest Payments, shall not bear interest.  Certain Accrued Interest Payments will accrue
interest at the Interest Rate. The amount of interest so accrued in respect of
any Accrued Interest Payments, if any, will be satisfied as and when the
Outstanding Payments are satisfied in accordance herewith. The amount of
additional interest payable with respect to any Accrued Interest Payments, if
any, will be calculated by the Trustee in accordance with the provisions of the
Indenture.

 

Except in the case of a
Mandatory Payment Event or a Mandatory Partial Payment Event, the Company may
satisfy any Optionally Deferred Payment at any time on not less than 16
Business Days’ notice to the Trustee and holders in accordance with the Third
Supplemental Indenture, and any Required Deferral Interest Payment shall be
satisfied on the relevant Deferred Interest Satisfaction Date, by giving not
less than 16 Business Days’ notice to the Trustee and holders, if the Required
Deferral Condition is no longer met on the 20th Business Day preceding any
subsequent Interest Payment Date, provided that the Company has not previously
paid such amount and does not validly elect to defer such payment as an
Optionally Deferred Payment.

 

Reference is hereby made to
the further provisions of this Security set forth on the reverse hereof, which
further provisions shall for all purposes have the same effect as if set forth
at this place.

 

Unless the certificate of
authentication hereon has been executed by the Trustee referred to on the
reverse hereof by manual signature, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.

 

S-2

 

IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed.

 

	
   

  	
  AEGON N.V.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Attest:

 

This is one of the
Securities of the series designated herein and referred to in the Third
Supplemental Indenture.

 

Dated:

 

 

	
   

  	
  Citibank, N.A.

  
	
   

  	
   

  	
  As Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

S-3

 

[Reverse of Security]

 

This Security is one of a
duly authorized issue of securities of the Company (herein called the Securities), issued and to be issued in one or more series
under an Indenture, dated as of October 11, 2001, as modified by a
supplemental indenture dated November 14, 2003, and a second supplemental
indenture dated June 1, 2005, between the Company, AEGON Funding Corp.,
AEGON Funding Corp. II and the Trustee (together called the Base Indenture), and a third supplemental indenture, dated
as of November 23, 2005 (herein called the Third
Supplemental Indenture and together
with the Base Indenture, the Indenture),
between the Company and Citibank, N.A., as Trustee (herein called the Trustee, which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of
the terms of the Securities and the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee, the holders of
Senior Debt and the holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities are
subject to all such terms. This Security is one of the series designated on the
face hereof and there is no limitation on the amount of Securities of such
series which may be issued.

 

Except in a bankruptcy, all
payments on this Security will be conditional upon not triggering the Required
Deferral Condition.  The Required Deferral Condition will be met if the Company (i) is not Solvent or making the relevant Payment
will result in the Company becoming not Solvent or (ii) is subject to a
Regulatory Event or making the relevant Payment will result in the Company
becoming subject to a Regulatory Event.

 

The Securities will
constitute direct, unsecured subordinated obligations of the Company, subject
to the Solvency Conditions, and the subordination provisions described herein
and in the Indenture, and will rank pari passu with respect to each other and
any other Parity Securities or Parity Guarantees and in priority to any Junior
Securities or Junior Guarantees.

 

If the Company fails to pay
or set aside for payment the amount due to satisfy any Payment on the
Securities when due and such failure continues for 14 days, it will constitute
a Payment Default (provided, however,
that if the Company fails to make any payment of interest required to be paid
as a result of a Mandatory Payment Event or Mandatory Partial Payment Event as
a result of the existence of a Required Deferral Condition, or due to a deferral
of an Interest Payment as permitted under the terms of the Indenture, that
payment will constitute an Outstanding Payment and will accumulate with any
other Outstanding Payments until paid, but will constitute neither a Payment
Default or a Payment Event (as defined below)). If any Payment Default occurs
and is continuing, the Trustee may pursue all legal remedies available to it,
including commencing a judicial proceeding for the collection of the sums due
and unpaid or the winding-up (faillissement or
vereffening na ontbinding) of the
Company in the Netherlands (but not elsewhere), but the Trustee may not declare
the principal amount of any outstanding Securities to be due and payable. If
the Company fails to make payment when due, and such failure continues for 14
days as a result of the existence of a Required Deferral Condition, such
failure does not constitute a Payment Default but instead constitutes a Payment Event.  On a
Payment Event, the Trustee may institute winding-up proceedings (faillissement or vereffening na ontbinding) exclusively in
The Netherlands, but may not pursue any other legal remedy, including a
judicial proceeding for the collection of the sums due and unpaid.  The Trustee shall not be bound to take any of
the foregoing actions against the Company to enforce the terms of the Indenture
or the Securities unless (i) it will have been so requested by an
extraordinary resolution or in writing by the holders of at least 25% in
principal amount of the Securities then outstanding and (ii) it will have
been offered reasonable security or indemnity satisfactory to it against the
costs, expenses and liabilities which might be incurred by it in compliance
with such request.  Notwithstanding the
foregoing, the right to institute winding-up proceedings (faillissement or vereffening na ontbinding) is limited to
circumstances where payment has become due. 
Notwithstanding the foregoing, holders of this Security have the

 

S-4

 

absolute and unconditional
right to institute suit for the enforcement of any payment when due and such
right may not be impaired without the consent of the holder as provided in Section 508
of the Base Indenture.

 

All payments in respect of
the Securities shall be made by the Company without withholding of or deduction
for any present or future taxes, duties, assessments or other charges imposed
by the government of the Netherlands or the government of a jurisdiction in
which a successor to the Company is organized (or any political subdivision or
taxing authority thereof or therein) (Taxes), unless
the withholding or deduction of such Taxes is required by law. To the extent
any such Taxes are so levied or imposed, the Company will, subject to the
exceptions and limitations set forth in Section 12 of the Third
Supplemental Indenture, pay such Additional Amounts to the holder of any
Security as may be necessary in order that the net amounts received by holders
of the Securities after such withholding or deduction equal the respective
amounts of principal and interest which would have been received in respect of
the Securities in the absence of such withholding or deduction, except that no
such Additional Amounts shall be payable in relation to any payment with
respect to the Securities.

 

Except as provided below,
the Securities are not redeemable at the option of the Company prior to December 15,
2010.

 

The Securities may be
redeemed in whole (but not in part), at the option of the Company and without
the consent of the holders or the Trustee, at a redemption price equal to their
aggregate principal amount, together with any Outstanding Payments accrued to
and including the date fixed for redemption: (i) on, December 15,
2010, or any Interest Payment Date thereafter; (ii) upon the occurrence of
a Tax Event, provided that the Company has already delivered to the Trustee a
written legal opinion in a form satisfactory to the Trustee of independent
Dutch counsel of recognized standing, selected by the Company, confirming that
a Tax Event has occurred; or (iii) if, at any time after the Company
becomes subject to Capital Adequacy Regulations, the relevant regulator has
determined that securities of the nature of the Securities cannot qualify as “own
funds” or “core capital” (Tier 1 capital or equivalent) for the purposes of
determination of such Capital Adequacy Regulations.

 

Subject to compliance with
applicable regulatory requirements, the Company may at any time convert or
exchange the Securities in whole (but not in part) to another series of its
capital securities having materially the same terms as the Securities and which
are no less favorable to the holders
than the current terms of the Securities. Any conversion of the Securities into
another series of capital securities as described herein will be made on not
less than 30 nor more than 60 days’ notice before the applicable conversion
date to the holders of the Securities and the Trustee.

 

The indebtedness evidenced
by this Security is, to the extent provided in the Indenture, subordinate and
subject in right of payment to the prior payment in full of all Senior Debt,
and this Security is issued subject to the provisions of the Indenture with
respect thereto. Each holder of this Security, by accepting the same, (i) agrees
to and shall be bound by such provisions; (ii) authorizes and directs the
Trustee on his or her behalf to take such actions as may be necessary or
appropriate to effectuate the subordination so provided; and (iii) appoints
the Trustee his or her attorney-in-fact for any and all such purposes. Each
holder hereof, by his or her acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Debt, whether now outstanding or hereafter created,
incurred, assumed or guaranteed, and waives reliance by each such holder upon
said provisions.

 

References herein to
principal, Interest Amounts, Mandatorily Deferred Payments, Optionally Deferred
Payments, Mandatory Partial Payments or Accrued Interest Payments shall be
deemed to include any Additional Amounts that may be payable, if applicable.

 

The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
holders of the Securities of each series to be

 

S-5

 

affected under the Indenture
at any time by the Company and the Trustee with the consent of the holders of a
majority in principal amount of the Securities at the time Outstanding of each
series to be affected. The Indenture also contains provisions permitting the
holders of a majority in principal amount of the Securities of each series at
the time outstanding, on behalf of the holders of all Securities of such
series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the holder of this Security shall be conclusive
and binding upon such holder and upon all future holders of this Security and
of any Security issued upon the registration of transfer hereof or in exchange
therefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.

 

No reference herein to the
Indenture and no provision of this Security or of the Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and any premium and interest on this Security at the
times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture
and subject to certain limitations therein set forth, the transfer of this
Security is registrable in the Security Register, upon surrender of this
Security for registration of transfer at the office or agency of the Company in
any place where the principal of and any premium and interest on this Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.

 

The Securities of this
series are issuable only in registered form without coupons in denominations of
$25.00 and any integral multiple thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities of this series
shall be represented by a Global Security and are not exchangeable for
definitive Securities of this series except in specific circumstances set forth
in the Indenture.

 

No service charge shall be
made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

 

Prior to due presentment of
this Security for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not
this Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.

 

This Security is a Global
Security and is subject to the provisions of the Indenture relating to Global
Securities, including the limitations in Section 305 thereof on transfers
and exchanges of Global Securities.

 

This Security and the
Indenture shall be governed by and construed in accordance with the laws of the
State of New York except for the subordination provisions contained herein and
in the Indenture, which shall be governed by and construed in accordance with
the laws of the Netherlands.

 

All terms used in this
Security which are defined in the Indenture shall have the meanings assigned to
them in the Indenture.

 

S-6

 

SCHEDULE 2

 

FORM OF FLOATING
RATE PERPETUAL CAPITAL SECURITIES

 

THIS SECURITY IS A GLOBAL
SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT
BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO
TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN
THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

The rights of the holders of
the Securities are, to the extent and in the manner set forth in Section 1402
of the Base Indenture and Article 6 of the Third Supplemental Indenture,
subordinated to Senior Debt, and this Security is issued subject to the
provisions of Article 14 of the Base Indenture and Article 6 of the
Third Supplemental Indenture, and the holder of this Security, by accepting the
same, agrees to and shall be bound by such provisions. The terms of this
paragraph are governed by, and shall be construed in accordance with, the laws
of the Netherlands.

 

AEGON N.V.

 

Floating
Rate Perpetual Capital Securities

 

No.

CUSIP No.:

ISIN No.:

COMMON CODE:

 

AEGON N.V., a corporation
duly organized and existing under the laws of the Netherlands (herein called
the Company, which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to CEDE & Co., or registered assigns,
the principal sum of $                              
(but only at such times as set forth in the Indenture with respect to Optional
Redemption, Redemption for Tax Reasons or Redemption or Conversion for
Regulatory Reasons in Article 3 of the Third Supplemental Indenture) and
to pay interest thereon from November 23, 2005 or from the most recent
Interest Payment Date to which interest has been paid or duly provided for,
quarterly in arrears on March 15, June 15, September 15 and December 15
in each year, commencing on March 15, 2006, and at such other times as are
set forth in the Indenture at a rate equal to the greater of (a) three-month
LIBOR (as determined by the Calculation Agent in the accordance with the
Calculation Agency Agreement) plus 0.875% and (b) 4.00%, to be reset
quarterly on each Interest Payment Date (as defined below), until the principal
hereof is paid or made available for payment. 
With respect to the initial interest period, however, the interest rate
will be [-]%.  The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the March 1, June 1,
September 1 or December 1 (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date.  Interest shall be calculated on the basis of
a 360-day year and the actual number of days elapsed in the Interest Period.  If any date on which interest would otherwise
be payable falls on a day that is not a Business Day, then the interest payment
date will be the next succeeding Business Day, except if such next succeeding
Business Day falls in the next succeeding calendar month, in which case the
interest payment date will be the immediately preceding Business Day (the
applicable date an Interest Payment Date).

 

S-7

 

Subject to the immediately
following paragraph, if applicable, any Payment on this Security which is
payable, and is paid or duly provided for, on any Interest Payment Date or on
any date on which the Company makes any Payment (including any payment of
Additional Amounts in accordance with Article 12 of the Third Supplemental
Indenture) shall be paid in U.S. dollars to the registered holder, including
through a Paying Agent by wire-transfer of same-day funds to the holder or, at
the option of the Company, by check mailed to the address of the holder as it
appears in the Company’s Security Register. For so long as this Security is
held in global form, all payments shall be made in U.S. dollars by
wire-transfer of same-day funds.

 

The Company shall under
certain circumstances, and in accordance with the Indenture, defer payments of
interest on this Security. Any interest on this Security which is not paid or
duly provided for on any applicable Interest Payment Date, together with any
other payments in respect of this Security not paid on any date on which such
Payment has become due and payable or would have become due and payable except
that payment is not made as permitted by the Indenture, so long as the same
remains unpaid, shall constitute “Outstanding Payments.” Outstanding Payments
will accumulate until paid and will constitute neither a Payment Default nor a
Payment Event. Outstanding Payments on this Security, when paid, as provided
subject to the conditions in the Indenture, will be paid on the Deferred
Interest Satisfaction Date to the holder in whose name this Security is
registered at the close of business on a Special Record Date for the Payment
due on such Deferred Interest Satisfaction Date to be fixed by the Trustee,
notice of which shall be given to holders of Securities not less than 10 days
prior to such Special Record Date, or be paid in any other lawful manner not
inconsistent with the requirements of any securities exchange on which this
Security may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture.

 

Outstanding Payments, other
than certain Accrued Interest Payments, shall not bear interest.  Certain Accrued Interest Payments will accrue
interest at the Interest Rate. The amount of interest so accrued in respect of
any Accrued Interest Payments, if any, will be satisfied as and when the
Outstanding Payments are satisfied in accordance herewith. The amount of
additional interest payable with respect to any Accrued Interest Payments, if
any, will be calculated by the Trustee in accordance with the provisions of the
Indenture.

 

Except in the case of a
Mandatory Payment Event or a Mandatory Partial Payment Event, the Company may
satisfy any Optionally Deferred Payment at any time on not less than 16
Business Days’ notice to the Trustee and holders in accordance with the Third
Supplemental Indenture, and any Required Deferral Interest Payment shall be
satisfied on the relevant Deferred Interest Satisfaction Date, by giving not
less than 16 Business Days’ notice to the Trustee and holders, if the Required
Deferral Condition is no longer met on the 20th Business Day preceding any
subsequent Interest Payment Date, provided that the Company has not previously
paid such amount and does not validly elect to defer such payment as an
Optionally Deferred Payment.

 

Reference is hereby made to
the further provisions of this Security set forth on the reverse hereof, which
further provisions shall for all purposes have the same effect as if set forth
at this place.

 

Unless the certificate of
authentication hereon has been executed by the Trustee referred to on the
reverse hereof by manual signature, this Security shall not be entitled to any
benefit under the Indenture or be valid or obligatory for any purpose.

 

S-8

 

IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed.

 

	
   

  	
  AEGON N.V.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Attest:

 

This is one of the
Securities of the series designated herein and referred to in the Third
Supplemental Indenture.

 

Dated:

 

 

	
   

  	
  Citibank, N.A.

  
	
   

  	
   

  	
  As Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

S-9

 

[Reverse of Security]

 

This Security is one of a
duly authorized issue of securities of the Company (herein called the Securities), issued and to be issued in one or more series
under an Indenture, dated as of October 11, 2001, as modified by a
supplemental indenture dated November 14, 2003, and a second supplemental
indenture dated June 1, 2005, between the Company, AEGON Funding, AEGON
Funding II and the Trustee (together called the Base
Indenture), and a third supplemental indenture, dated as of November 23,
2005 (herein called the Third  Supplemental Indenture and together with the Base Indenture,
the Indenture), between the Company and
Citibank, N.A., as Trustee (herein called the Trustee,
which term includes any successor trustee under the Indenture), and reference
is hereby made to the Indenture for a statement of the terms of the Securities
and the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee, the holders of Senior Debt and the
holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. The Securities are subject to all such
terms. This Security is one of the series designated on the face hereof and
there is no limitation on the amount of Securities of such series which may be
issued.

 

Except in a bankruptcy, all
payments on this Security will be conditional upon not triggering the Required
Deferral Condition.  The Required Deferral Condition will be met if the Company (i) is not Solvent or making the relevant Payment
will result in the Company becoming not Solvent or (ii) is subject to a
Regulatory Event or making the relevant Payment will result in the Company
becoming subject to a Regulatory Event.

 

The Securities will
constitute direct, unsecured subordinated obligations of the Company, subject
to the Solvency Conditions, and the subordination provisions described herein
and in the Indenture, and will rank pari passu with respect to each other and
any other Parity Securities or Parity Guarantees and in priority to any Junior
Securities or Junior Guarantees.

 

If the Company fails to pay
or set aside for payment the amount due to satisfy any Payment on the
Securities when due and such failure continues for 14 days, it will constitute
a Payment Default (provided, however,
that if the Company fails to make any payment of interest required to be paid
as a result of a Mandatory Payment Event or Mandatory Partial Payment Event as
a result of the existence of a Required Deferral Condition, or due to a
deferral of an Interest Payment as permitted under the terms of the Indenture,
that payment will constitute an Outstanding Payment and will accumulate with
any other Outstanding Payments until paid, but will constitute neither a
Payment Default or a Payment Event (as defined below)). If any Payment Default
occurs and is continuing, the Trustee may pursue all legal remedies available
to it, including commencing a judicial proceeding for the collection of the
sums due and unpaid or the winding-up (faillissement
or vereffening na ontbinding)
of the Company in the Netherlands (but not elsewhere), but the Trustee may not
declare the principal amount of any outstanding Securities to be due and
payable. If the Company fails to make payment when due, and such failure
continues for 14 days as a result of the existence of a Required Deferral
Condition, such failure does not constitute a Payment Default but instead
constitutes a Payment Event.  On a Payment Event, the Trustee may institute
winding-up proceedings (faillissement or
vereffening na ontbinding)
exclusively in The Netherlands, but may not pursue any other legal remedy,
including a judicial proceeding for the collection of the sums due and
unpaid.  The Trustee shall not be bound
to take any of the foregoing actions against the Company to enforce the terms
of the Indenture or the Securities unless (i) it will have been so
requested by an extraordinary resolution or in writing by the holders of at
least 25% in principal amount of the Securities then outstanding and (ii) it
will have been offered reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request. 
Notwithstanding the foregoing, the right to institute winding-up
proceedings (faillissement or vereffening na ontbinding) is limited to
circumstances where payment has become due. 
Notwithstanding the foregoing, holders of this Security have the

 

S-10

 

absolute and unconditional
right to institute suit for the enforcement of any payment when due and such
right may not be impaired without the consent of the holder as provided in Section 508
of the Base Indenture.

 

All payments in respect of
the Securities shall be made by the Company without withholding of or deduction
for any present or future taxes, duties, assessments or other charges imposed
by the government of the Netherlands or the government of a jurisdiction in
which a successor to the Company is organized (or any political subdivision or
taxing authority thereof or therein) (Taxes), unless
the withholding or deduction of such Taxes is required by law. To the extent
any such Taxes are so levied or imposed, the Company will, subject to the
exceptions and limitations set forth in Section 12 of the Third
Supplemental Indenture, pay such Additional Amounts to the holder of any
Security as may be necessary in order that the net amounts received by holders
of the Securities after such withholding or deduction equal the respective
amounts of principal and interest which would have been received in respect of
the Securities in the absence of such withholding or deduction, except that no
such Additional Amounts shall be payable in relation to any payment with
respect to the Securities.

 

Except as provided below,
the Securities are not redeemable at the option of the Company prior to December 15,
2010.

 

The Securities may be
redeemed in whole (but not in part), at the option of the Company and without
the consent of the holders or the Trustee, at a redemption price equal to their
aggregate principal amount, together with any Outstanding Payments accrued to
and including the date fixed for redemption: (i) on, December 15,
2010, or any Interest Payment Date thereafter; (ii) upon the occurrence of
a Tax Event, provided that the Company has already delivered to the Trustee a
written legal opinion in a form satisfactory to the Trustee of independent
Dutch counsel of recognized standing, selected by the Company, confirming that
a Tax Event has occurred; or (iii) if, at any time after the Company
becomes subject to Capital Adequacy Regulations, the relevant regulator has
determined that securities of the nature of the Securities cannot qualify as “own
funds” or “core capital” (Tier 1 capital or equivalent) for the purposes of
determination of such Capital Adequacy Regulations.

 

Subject to compliance with
applicable regulatory requirements, the Company may at any time convert or
exchange the Securities in whole (but not in part) to another series of its
capital securities having materially the same terms as the Securities and which
are no less favorable to the holders
than the current terms of the Securities. Any conversion of the Securities into
another series of capital securities as described herein will be made on not
less than 30 nor more than 60 days’ notice before the applicable conversion
date to the holders of the Securities and the Trustee.

 

The indebtedness evidenced
by this Security is, to the extent provided in the Indenture, subordinate and
subject in right of payment to the prior payment in full of all Senior Debt,
and this Security is issued subject to the provisions of the Indenture with
respect thereto. Each holder of this Security, by accepting the same, (i) agrees
to and shall be bound by such provisions; (ii) authorizes and directs the
Trustee on his or her behalf to take such actions as may be necessary or
appropriate to effectuate the subordination so provided; and (iii) appoints
the Trustee his or her attorney-in-fact for any and all such purposes. Each
holder hereof, by his or her acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Debt, whether now outstanding or hereafter
created, incurred, assumed or guaranteed, and waives reliance by each such
holder upon said provisions.

 

References herein to
principal, Interest Amounts, Mandatorily Deferred Payments, Optionally Deferred
Payments, Mandatory Partial Payments or Accrued Interest Payments shall be
deemed to include any Additional Amounts that may be payable, if applicable.

 

The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
holders of the Securities of each series to be

 

S-11

 

affected under the Indenture
at any time by the Company and the Trustee with the consent of the holders of a
majority in principal amount of the Securities at the time Outstanding of each
series to be affected. The Indenture also contains provisions permitting the
holders of a majority in principal amount of the Securities of each series at
the time outstanding, on behalf of the holders of all Securities of such
series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the holder of this Security shall be conclusive
and binding upon such holder and upon all future holders of this Security and
of any Security issued upon the registration of transfer hereof or in exchange
therefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.

 

No reference herein to the
Indenture and no provision of this Security or of the Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and any premium and interest on this Security at the
times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture
and subject to certain limitations therein set forth, the transfer of this
Security is registrable in the Security Register, upon surrender of this
Security for registration of transfer at the office or agency of the Company in
any place where the principal of and any premium and interest on this Security
are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.

 

The Securities of this
series are issuable only in registered form without coupons in denominations of
$25.00 and any integral multiple thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities of this series
shall be represented by a Global Security and are not exchangeable for
definitive Securities of this series except in specific circumstances set forth
in the Indenture.

 

No service charge shall be
made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

 

Prior to due presentment of
this Security for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not
this Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.

 

This Security is a Global
Security and is subject to the provisions of the Indenture relating to Global
Securities, including the limitations in Section 305 thereof on transfers
and exchanges of Global Securities.

 

This Security and the
Indenture shall be governed by and construed in accordance with the laws of the
State of New York except for the subordination provisions contained herein and
in the Indenture, which shall be governed by and construed in accordance with
the laws of the Netherlands.

 

All terms used in this
Security which are defined in the Indenture shall have the meanings assigned to
them in the Indenture.

 

S-12

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