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The computation of diluted earnings per common share for the years ended December 31, 2004, 2003 and 2002 include the weighted average common shares that would be issuable upon conversion of Bunge’s 3.75% convertible notes due 2022, having a $250 million aggregate principal amount. The convertible notes are convertible into Bunge’s common shares at the option of a holder, among other circumstances, during any calendar quarter in which the closing price of Bunge’s common shares for at least 20 trading days of the last 30 trading days of the immediately preceding calendar quarter is more than 120% of the conversion price of $32.1402 or approximately $38.57 per share. The initial conversion rate is 31.1137 common shares of Bunge Limited for each $1,000 principal amount of notes converted. 

The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2004, 2003 and 2002. 

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## notes to the consolidated financial statements 

## 25. stock-based compensation 

equity incentive plan In 2001, Bunge established its Equity Incentive Plan which is a shareholder approved plan. Under the plan, the compensation committee of the board of directors may award equity-based compensation to officers, employees, con- sultants and independent contractors. Awards under the plan may be in the form of stock options (statutory or non-statutory), restricted stock units (performance-based or time-vested) or other awards. 

stock option awards Generally, stock options to purchase Bunge Limited common shares are non-statutory and granted at not less than fair market value on the date of grant, as deter- mined under the Equity Incentive Plan. Options generally vest on a pro-rata basis over a three-year period on the anniversary date of the grant. Vesting may be accelerated in certain circum- stances such as a change in control of Bunge. 

restricted stock units Performance-based restricted stock units and time-vested restricted stock units are granted to a limited number of key employees. The performance-based restricted stock units are awarded at the beginning of a three- year performance period and vest following the end of the three-year performance period. The vesting of the performance- based restricted stock units is dependent on Bunge obtaining certain targeted cumulative earnings per share (EPS) or segment operating profit (for awards granted to employees of operating companies) during the three-year performance period. The targeted cumulative EPS under the plan is based on income per share from continuing operations adjusted for non-recurring charges and other one-time events at the discretion of Bunge’s compensation committee. Vesting may be accelerated in certain situations such as a change in control of Bunge. The actual award is calculated based on a sliding scale whereby 50% of the granted performance-based restricted stock unit award vests if the minimum target is achieved. No vesting occurs if cumulative EPS or the segment operating profit is less than the minimum target. The award is capped at 150% of the grant for cumulative EPS performance in excess of the maximum target for the 2002 and 2003 grants and 200% of the grant for cumulative EPS per- formance or segment operating profit in excess of the maximum target for the 2004 grants. Performance-based restricted stock unit awards may be paid out, at the participant’s election, subject 

