UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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Filed by the Registrant x |
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Filed by a Party other than the Registrant o |
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Filed by the Registrant x
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Filed by a Party other than the Registrant o
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Check the appropriate box: |
x | Preliminary Proxy Statement |
| o | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
ox | Definitive Proxy Statement |
| o | Definitive Additional Materials |
| o | Soliciting Material under §240.14a-12 |
BUNGE LIMITED
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check all boxes that apply):
xNo fee required
oFee paid previously with preliminary materials
oFee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11
NOTICE OF ANNUAL GENERAL MEETING OF SHAREHOLDERS
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| Date and Time: | Thursday, May 11, 2023, at 11:00 a.m. Central Daylight Time |
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| Place: | This year's meeting is a virtual shareholders meeting at www.virtualshareholdermeeting.com/BG2023. |
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| Record Date: | March 13, 2023 |
| Shareholders as of the Record Date are entitled to notice of, and to vote at, the Annual General Meeting and at any subsequent adjournments or postponements. |
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| Voting: | |
| Your vote is very important. Whether or not you plan to join the Annual General Meeting, please promptly vote by internet, telephone or by mail so that your shares will be represented at the meeting. If you are a registered holder of our common shares (i.e., you hold your shares through our transfer agent, Computershare), please follow the instructions included in your proxy materials or on your proxy card to access the Annual General Meeting. If your common shares are held through an intermediary (i.e., brokerage firm, bank or other nominee), you should receive a voting instruction form from your brokerage firm, bank or other nominee. |
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| Meeting Details: | |
Please read carefully “Information About this Proxy Statement and Meeting” beginning on page 79 of this proxy statement to ensure that you comply with the requirements for voting and accessing the Annual General Meeting. |
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Payment of Filing Fee (CheckAt the appropriate box):Annual General Meeting, we are asking shareholders to vote on the following: |
xManagement Proposals | No fee required. |
o | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.Board Recommends |
| (1)Election of the 11 director nominees named in the proxy statement | Title of each class of securities to which transaction applies:PFOR |
| (2)Approval of a non-binding advisory vote on the compensation of our named executive officers | Aggregate number of securities to which transaction applies:PFOR |
| (3)A non-binding advisory vote on the frequency of future shareholder advisory votes on executive compensation | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):PONE YEAR |
| (4) | Proposed maximum aggregate valueAppointment of transaction: |
| (5) | Total fee paid: |
o | Fee paid previously with preliminary materials. |
o | Check box if any partDeloitte & Touche LLP as our independent auditor for fiscal year 2023, and authorization of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identifyAudit Committee of the filing for whichBoard of Directors to determine the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| independent auditor's fees | (1) | Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
| (3) | Filing Party: |
| (4) | Date Filed:PFOR |
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| Bunge Limited
1391 Timberlake Manor Parkway
St. Louis, Missouri 63017
U.S.A. |
Dear Shareholder:
Enclosed is the proxy statement for Bunge’s 2023 special shareholders meeting to be held on [●], [●], 2023.
You are being asked to vote upon a proposal to approve the Redomestication that would change the place of incorporation of the ultimate parent company of the Bunge Group from Bermuda to Switzerland. As part of the Redomestication, we will become a Swiss corporation and our corporate name will change to [●]. The number of shares you will own in [●], the Swiss company, will be the same as the number of common shares you held in Bunge Limited, the Bermuda company, immediately prior to the completion of the Redomestication, and your relative economic interest in Bunge will remain unchanged. And, while distributions paid by Swiss companies are generally subject to Swiss withholding tax, because we will make distributions out of qualifying capital contribution reserves, no Swiss withholding tax should apply to distributions paid by [●] for the foreseeable future.
After the completion of the transaction, [●] will continue the business operations conducted by Bunge Limited before the transaction. The shares of [●] will be listed on the New York Stock Exchange under the symbol “BG,” the same symbol under which your common shares are currently listed.
Bunge was incorporated in Bermuda when the then-separate Bunge companies consolidated in 1995. On [●], 2022, our Board of Directors unanimously approved the Redomestication to Switzerland, following an extensive review of our business operations and emerging trends in the global tax environment. Switzerland allows Bunge to align its corporate legal structure with its commercial operations, is more centrally located within our major markets and home of many global companies. It will locate Bunge in a country with balanced corporate governance requirements, more sophisticated financial and commercial infrastructure as well as a stable and well-developed legal system. We have had substantial operations in Switzerland for many years.
Our Redomestication to Switzerland is subject to various conditions, including shareholder approval and the approval of the Supreme Court of Bermuda (the “Bermuda Court”), and is expected to be completed later this year. We may delay or otherwise abandon the Redomestication if future events occur that cause us to determine that the Redomestication is no longer in the best interests of Bunge or its shareholders.
This proxy statement provides you with detailed information regarding the Redomestication. We encourage you to read this entire document carefully. You should carefully consider “Risk Factors” beginning on page [●] for a discussion of risks before voting at the meeting.
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| Shareholder Proposal | | | Board Recommend |
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| Shareholder ratification of termination pay | Kathleen Hyle
Chair of the Board of DirectorsOAGAINST
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Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in the transaction or determined if this proxy statement is truthful or complete. Any representation to the contrary is a criminal offense.
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| Bunge Limited
1391 Timberlake Manor Parkway
St. Louis, Missouri 63017
U.S.A. |
This proxy statement is dated [●] and is first being mailed to shareholders on or about [●].
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Bunge Limited
1391 Timberlake Manor Parkway
St. Louis, Missouri 63017
Important Notice of Internet Availability of Proxy Materials for the Annual General Meeting to be held on May 11, 2023: The Proxy Statement and Annual Report on Form 10-K are available at investors.bunge.com/investors/corporate-governance/governance-documents and www.ProxyVote.com.
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NOTICE OF MEETING OF BUNGE LIMITED SHAREHOLDERS
To Be Held On [●], 2023
To the holders of voting and non-voting shares of Bunge Limited:
We will hold a meeting of our shareholders online via live webcast at [●], commencing at [●] local time, on [●], 2023 to vote:
a.to approve the Redomestication that would change the place of incorporation of the ultimate parent company of the Bunge Group from Bermuda to Switzerland through a Bermuda law Scheme of Arrangement attached as Annex A to this proxy statement.
b.to adjourn the meeting to a later date to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Redomestication.
c.on any other matters that properly come before the meeting and any adjournments or postponements of the meeting.
The close of business on [●], 2023 is the record date for determining the shareholders entitled to notice of and to vote at the meeting or any adjournments or postponements of the meeting.
Please vote your shares to ensure your shares are represented. You should complete, sign and date the enclosed proxy and return it promptly in the enclosed envelope, whether or not you expect to attend the virtual meeting. You may revoke your proxy and vote in person if you decide to attend the virtual meeting. You may also designate proxies to vote your shares via the Internet or by telephone. Your Internet or telephone designation authorizes the named proxies to vote your shares in the same manner as if you marked, signed and returned your proxy card. Please review the instructions in the proxy statement and on your proxy card regarding each of these options.
The Redomestication is subject to various conditions, including the approval of the Bunge shareholders and the Supreme Court of Bermuda.
By Order of the Board of Directors | | | | | |
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[●],March 31, 2023 | Lisa Ware-Alexander Vice President, Deputy General Counsel and Corporate Secretary |
This proxy statement incorporates documents by reference. See “Where You Can Find More Information” beginning on page [●] for a listing of documents incorporated by reference. These documents are available to any person, including any beneficial owner, upon request directed to our Investor Relations department by telephone at 636-292-3014 or by submitting a written request to 1391 Timberlake Manor Parkway, Chesterfield, Missouri 63017, U.S.A., Attention: Ruth Ann Wisener. To ensure timely delivery of these documents, any request should be made by [●]. The exhibits to these documents will generally not be made available unless they are specifically incorporated by reference in this proxy statement.
TABLE OF CONTENTS
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Overview of the Redomestication | |
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| Proposals and Voting Recommendations for the Annual Meeting | |
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| 2022 Financial and Strategic Highlights | |
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Director Selection and Qualifications | |
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Equity Incentive Plans | |
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iBunge | 2023 Proxy Statement
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| Information About this Proxy Statement and Meeting | |
| Information About the Meeting | |
| Information About Voting | |
| Solicitation of Proxies | |
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Bunge | 2023 Proxy Statement ii
This summary highlights certain information contained in this proxy statement. As it is only a summary, please review the entire proxy statement before voting.
Annual General Meeting Information
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| Time and Date: | Thursday, May 11, 2023, at 11:00 a.m. Central Daylight Time, with log in beginning at 10:45 a.m. |
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| Location: | The Annual General Meeting will be a virtual meeting conducted exclusively online via live audio webcast, allowing shareholders to participate in the meeting from any location convenient to them. There will not be a physical meeting.
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| Record Date: | Shareholders of record as of the close of business on March 13, 2023 are entitled to vote. |
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| Voting: | Each issued and outstanding common share is entitled to one vote. You may vote by telephone, internet, mail or by accessing the Annual General Meeting. Please see "Information About Voting" on page 7182. |
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| Attendance: | To access the Annual General Meeting, please follow the instructions contained in "Information About the Meeting" on page Where You Can Find More Information80. Shareholders who access the meeting will be allowed to submit questions in our virtual shareholder meeting forum before and during the meeting.
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Proposals and Voting Recommendations for the Annual Meeting
A majority of votes cast is required to approve each proposal, unless otherwise indicated.
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| Proposal | Board's Voting
Recommendation | Page References
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| 1 | | Election of Directors | P FOR EACH NOMINEE | |
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| 2 | | Advisory Vote to Approve Named Executive Officer Compensation | P FOR | |
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| 3 | | Advisory Vote on the Frequency of Future Shareholder Advisory Votes on Executive Compensation | P ONE YEAR | |
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| 4 | | Appointment of Independent Auditor and Authorization of the Audit Committee of the Board to Determine the Independent Auditor's Fees | P FOR | |
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| 5 | | Shareholder Proposal Regarding Shareholder Ratification of Termination Pay | O AGAINST | |
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1 Bunge | 2023 Proxy Statement
Director Nominees
As part of the Board’s succession planning efforts, Mr. Fyrwald and Ms. Hyle will not be standing for re-election and will be retiring from the Board at the Annual General Meeting. The Board of Directors has nominated the 11 directors named below for election at the Annual General Meeting and recommends that shareholders vote FOR the election of each director nominee. Each nominee, except for Mr. Fransen and Ms. McGurk, is currently a director of the Company. The following table provides summary information about each nominee, including committee assignments, following the Annual General Meeting on May 11, 2023. See "Proposal 1 - Election of Directors" on page 8 for additional information regarding the nominees. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Director Since | Other Public Boards | | Committee Membership |
| Name | Age | Independent | Audit (1) | CGNC (2) | ERMC (3) | HRCC (4) | SCRC (5) |
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| Eliane Aleixo Lustosa de Andrade | 60 | 2022 | 3 | Yes | l | | | | l |
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| Sheila Bair | 68 | 2019 | 1 | Yes | l | l(C) | l | | |
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| Carol Browner | 67 | 2013 | 0 | Yes | | l | | | l(C) |
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| David Fransen | 65 | Nominee | 0 | Yes | | | l | l | |
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| Gregory Heckman | 60 | 2018 | 1 | No | | | | | |
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| Bernardo Hees | 53 | 2019 | 1 | Yes | | | | l | l |
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| Michael Kobori | 63 | 2021 | 0 | Yes | | | l | | l |
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| Monica McGurk | 53 | Nominee | 0 | Yes | | l | l | | |
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| Kenneth Simril | 57 | 2021 | 0 | Yes | l | | | l(C) | |
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| Henry "Jay" Winship | 55 | 2018 | 1 | Yes | l(C) | l | | l | |
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| Mark Zenuk | 55 | 2018 | 0 | Yes | | | l(C) | | |
| Board Chair |
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l = Member | | (1) | Audit Committee | | (4) | Human Resources and Compensation Committee |
| (C) = Chair | | (2) | Corporate Governance and Nominations Committee | | (5) | Sustainability and Corporate Responsibility Committee |
| | (3) | Enterprise Risk Management Committee |
Through its ongoing Board refreshment process, the Board strives to achieve the right balance of long-tenured directors, with years of experience and institutional knowledge, and new directors who bring diverse thinking to the boardroom.
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| Director Nominee Tenure | | Director Nominee Independence |
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| Average Tenure = 2.6 Years of Service | | |
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Bunge | 2023 Proxy Statement 2
Key Skills, Qualifications, Backgrounds and Experience Following the 2023 Annual General Meeting
Our director nominees possess a diverse range of relevant and complementary skills, qualifications, backgrounds and experience. Additional information regarding each director nominee's qualifications, experience and skills are included in the director nominee skills matrix and in each director nominee’s profile, which are included in "Proposal 1 - Election of Directors." This high-level summary presented in the chart below illustrates the principal board skills as a whole and is not intended to be an exhaustive list of the director nominee's contributions to the Board.
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| Public Company CEO Experience | | | | 2 | | | | | | | |
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| Financial | | | | | | | | | 7 | | |
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| Risk Management | | | | | | | | | | | 9 |
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| South America Business Expertise | | | | 2 | | | | | | | |
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| China Business Expertise | | | 1 | | | | | | | | |
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| Agricultural Industry | | | | | | | 5 | | | | |
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| Food Ingredient | | | | | 3 | | | | | | |
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| Digital | | | | 2 | | | | | | | |
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| Manufacturing and Logistics | | | | | | | | 6 | | | |
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| Government and Public Policy | | | | | 3 | | | | | | |
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| Sustainability | | | | | 3 | | | | | | |
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| Director Nominee Gender Diversity | | | Director Nominee Racial / Ethnic Diversity |
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3 Bunge | 2023 Proxy Statement
Corporate Governance Highlights
Our commitment to good corporate governance practices includes the following:
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| L | Active, Independent and Effective Board |
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| •10 out of 11 director nominees are independent •All Board committee members are independent •Independent, non-executive Board Chair and Deputy Chair •Executive sessions of independent directors at each Board and committee meeting •Board and committees have access to independent legal, financial, executive compensation and other advisors •Directors have unlimited access to Company officers and employees •Orientation and continuing education programs for directors •Balance of new and experienced directors •High rate of board attendance at Board and committee meetings, with average 2022 attendance of approximately 98% |
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ANNEX AG | Corporate Governance |
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| 73•Commitment to Board refreshment; average tenure of our Board is less than 3 years•Corporate Governance Principles include a diversity policy and robust director succession and refreshment processes •Commitment to actively seeking highly qualified women and individuals from historically underrepresented groups to include in the candidate pool from which Board nominees are selected; 36% of our directors are female and 36% are ethnically diverse •Director retirement age of 72 •In response to shareholder feedback, we amended our bye-laws to eliminate certain supermajority voting requirements in 2022 •Commitment to overseeing Environmental, Social and Governance (ESG) matters, including community relations, and, in 2022, refreshed committee charters to clarify ESG oversight •Annual Board review of Company strategy •Active risk oversight by full Board and subject matter oversight by the committees •Robust Board and committee self-assessments and director nomination processes •Board takes active role in management succession planning •Limitations on the number of other public companies Board members may serve on |
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| m | Shareholder Rights & Engagement |
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| •Long-standing and active shareholder outreach program with director participation •Single class of stock with equal voting rights •Annual election of directors •Simple majority voting standard at meetings implemented in 2022, including to remove directors without cause, to approve business combinations (as defined in the bye-laws) and to amend the bye-laws •10% or more of our issued and outstanding common shares may call a special meeting of shareholders •Bye-laws permit shareholders to nominate directors to the Board •No poison pill |
iiiBunge | 2023 Proxy Statement 4
2022 Financial and Strategic Highlights
In 2022, the Company experienced an exceptional year as we posted the strongest performance in our history to date. Our global platform, approach, and focused execution by our teams demonstrated the critical role we play in global food security: maintaining flows of crops from farmers to consumers in a volatile and demanding environment. At the same time, over the course of the year we made progress on executing our strategy to strengthen and expand our core business while positioning us to benefit over the long-term from the growing demand for food, feed and renewable fuel.
Highlights of our operational, strategic and financial achievements in 2022 are provided below:
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$10.51 full-year GAAP earnings per share | $13.91 adjusted earnings per share(1) | | Highest recorded adjusted Earnings Per Share ("EPS") in Company history |
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Introduced Earnings Growth Framework to increase mid-cycle baseline from $8.50 to ~$11.00 per share by end of 2026(2) | | Returned $549M to shareholders through dividends and share repurchases |
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| Agribusiness, Refined and Specialty Oils and Milling segments posted record full-year results | | Continued to reduce Scope 1, 2 and 3 emissions to achieve Science Based Target commitments by 2030 |
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| Financial return metrics continued to significantly exceed respective costs of capital | | Continued great progress on finding innovative, sustainable solutions for the renewables space |
(1)Adjusted EPS is a non-GAAP financial measure, see Appendix A – Reconciliation of Non-GAAP Financial Measures for reconciliation to the most directly comparable U.S. GAAP measure.
(2)We have not presented a comparable U.S. GAAP financial measure for the Earnings Growth Framework financial measure presented on an adjusted, non-GAAP basis because the information necessary for such presentation is unavailable at this time. The information necessary to prepare the comparable U.S. GAAP presentation could result in significant differences from the non-GAAP financial measure presented in this proxy statement.
5 Bunge | 2023 Proxy Statement
Sustainability Highlights
We also deepened our commitment to sustainability and further embedded climate-focused decision-making into our strategies, operations and investments. We’ve taken robust actions to reduce our own environmental footprint and increased our collaboration with partners, customers and other stakeholders to improve the sustainability of the food production chain. Our approach to sustainability reflects our three priority areas, and includes some of the important achievements described below:
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| Action on Climate | | | Responsible Supply Chains | | | Accountability |
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| Further reduction in GHG emissions for Scopes 1, 2 and 3 | | Increased sourcing of deforestation-free commodities | | Achieved ESG targets under $1.75B sustainability-linked revolving credit facility |
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| Joint venture with Chevron to increase the supply of renewable plant-based fuels | | Began enhancing our global human rights strategy | | Developed a new global contributions policy to promote education and food security |
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| Strengthened climate-related risk and opportunity framework | | Created partnerships to increase soybean traceability in high-risk deforestation areas | | Supported employee development through new trainings and learning programs |
We view sustainability as a key part of our strategy to maximize long-term shareholder value, as we believe that operating responsibly and providing products that help our customers and farmers achieve their sustainability goals provides us opportunities to (1) grow our business, (2) increase customer collaboration and loyalty, (3) retain, attract and motivate employees, and (4) reduce our impact on the environment.
Executive Compensation Highlights
Our executive compensation philosophy is built upon a strong foundation of linking pay with performance over the long-term and is structured to:
•Align the interests of executives with the long-term interests of shareholders. The majority of pay opportunity for our Named Executive Officers (NEOs) is delivered in the form of performance-based incentives.
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| Base Salary | Annual Cash Incentive | Long-Term Equity-Based Incentive |
CEO Target Total Compensation Mix(1) | 9% | 15% | 76% |
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| | 91% Variable |
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| Base Salary | Annual Cash Incentive | Long-Term Equity-Based Incentive |
Other NEO Target Total Compensation Mix(1) | 21% | 19% | 60% |
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(1) Base salary, target annual cash incentive and target value of equity awards at grant.
Bunge | 2023 Proxy Statement 6
•Drive business goals and strategies. Incentive plan targets are directly tied to business goals and strategies, including ESG goals, and are based upon metrics that drive long-term value creation.
•Reward profitable growth and increased shareholder value. Performance metrics balance earnings growth and returns on investment. The pay mix is equity leveraged, resulting in realized compensation in line with stock price performance.
The table below highlights our current executive compensation practices that drive performance and serve our shareholders' long-term interests.
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OVERVIEW OF THE REDOMESTICATIONWHAT WE DO | | WHAT WE DON'T DO |
We are seeking shareholder approval at the meeting of a merger transaction by way of the Bermuda law Scheme of Arrangement, attached to this proxy statement as Annex A (the “Scheme of Arrangement”) that will effectively change the place of incorporation of the parent company of the Bunge Group from Bermuda to Switzerland (the “Redomestication”).
If the Scheme of Arrangement becomes effective, it will effect a share exchange (the “Share Exchange”) pursuant to which (i) your common shares of Bunge Limited (“Bunge-Bermuda”) will be exchanged for an equal number of registered shares of [●] (“Bunge-Switzerland”) and (ii) Bunge-Switzerland will become the parent company of the Bunge Group.
Bunge incorporated in Bermuda in 1995 when the then-separate Bunge group of companies consolidated into a single company. Over the past few years, Bunge has undertaken an extensive review of its business operations and the emerging trends in the global tax environment. As part of this review, Bunge performed a substantial analysis of alternative jurisdictions to which the Company might redomesticate. Switzerland was determined to be the best jurisdiction in which to redomesticate because it allows Bunge to better align its corporate legal structure with Bunge’s commercial operations and because Bunge has conducted substantial business operations in Switzerland for decades. Switzerland is also a jurisdiction that is well suited for global companies and offers a well-developed corporate, legal and regulatory environment.
As part of this review, Bunge has taken into account likely legislative tax changes proposed by the member states of the Organization for Economic Cooperation and Development (or "OECD") and in particular the Pillar 2 Model Rules, aiming at introducing a global minimum corporate tax rate of 15% on financial statement income. The focus of the OECD is to discourage multinational corporations from using low tax or no tax jurisdictions (tax havens) to avoid taxation.
Our Redomestication to Switzerland is subject to various conditions, including shareholder approval and the approval of the Bermuda Court, and is expected to be effective later this year. We may, however, delay or otherwise abandon the Redomestication if future events occur that cause our board of directors to determine that the Redomestication is no longer in the interest of Bunge or its shareholders.
If the Redomestication is completed:
•the place of incorporation and principal executive office of [●] will be Switzerland;
•the operational headquarters of the Bunge Group will remain in St. Louis, Missouri;
•our corporate name will be changed to [●];
•holders of shares in Bunge Limited will automatically receive shares in [●] on an one-for-one basis, and their relative economic interest in the Bunge Group will remain unchanged; and
•[●] shares will be listed for trading on the NYSE under the ticker symbol “BG”.
Bunge’s current dividend rate, shareholder communications and related matters will be unchanged. The effects of Redomestication on Bunge and its shareholders are explained in “Certain Tax Considerations” starting at page [●] and “Comparison of Shareholder Rights” starting at page [●].
The Redomestication will be completed pursuant to the Scheme of Arrangement, which is subject to shareholder approval and the approval of the Bermuda Court. The Scheme of Arrangement contemplates a merger by which (i) [●] will become the publicly traded parent company of the Bunge Group and (ii) holders of Bunge Limited common shares will receive common shares of [●] on a one-for-one basis.
The Redomestication involves several steps.
1) Incorporation of a new company registered in Geneva, Switzerland, named [●] (“Bunge-Switzerland”), as a direct, wholly-owned subsidiary of Bunge Limited, the Bermuda company whose shares you currently own (“Bunge-Bermuda”).
2) Bunge-Switzerland, in turn, forms a new Bermuda subsidiary named Horizon Merger Company Limited (“Bunge-MergerCo”).
3) Following the Bunge-Bermuda shareholders' meeting to be held on [●] and a hearing of the Bermuda Court scheduled for [●], assuming we have obtained the necessary shareholder and court approvals, Bunge-MergerCo will merge with Bunge-Bermuda by way of the Scheme of Arrangement, with Bunge-Bermuda as the surviving company. As a result of the Redomestication, Bunge-MergerCo will cease to exist, and Bunge-Bermuda will become a direct, wholly-owned subsidiary of Bunge-Switzerland.
4) Effective for the date that is one day after the effective date of the merger of Bunge-Bermuda with Bunge-MergerCo ("Effective Date"), Bunge-Bermuda will make a U.S. tax election to be treated as a disregarded entity for U.S. tax purposes.
The diagram that follows depicts the Redomestication:
In this proxy statement, we sometimes refer to Bunge-Bermuda and Bunge-Switzerland as “we,” “our” or “Bunge.”
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QUESTIONS AND ANSWERS ABOUT THE REDOMESTICATIONP | We Do award 60% of target total compensation for other NEOs on average and 76% for our CEO in long-term equity-based incentives | | O | We Don't allow repricing of stock options or buy out underwater stock options without shareholder approval |
| P | We Do use multiple performance metrics for short-term and long-term awards | | O | We Don't have single trigger change of control provisions |
| P | We Do have comprehensive disclosure of metrics and goals | | O | We Don't have golden parachute excise tax gross ups |
| P | We Dohave long-term incentives that are majority performance-based | | O | We Don't allow hedging or pledging of Company shares or holding Company shares in margin accounts |
| P | We Do have robust share ownership guidelines for directors, executive officers and other senior leaders | | O | We Don't allow transactions by directors, officers and Company insiders in Company stock without pre-clearance |
| P | We Doconduct an annual compensation risk assessment for employee incentive plans | | O | We Don't have excessive executive perquisites |
| P | WeDo have a clawback policy | | | |
Q: What am I being asked
Shareholder Engagement Highlights
Shareholder feedback is a key input to vote on at the meeting?
A: You are being asked to vote on the Redomestication, which will effectively change our placecompensation program. Between 2014, when we began our annual shareholder engagement program, and 2021, an average of incorporation from Bermuda to Switzerland by way86% of votes cast were in favor of our executive compensation program. At our 2022 Annual General Meeting, 96.7% of the Scheme of Arrangement.
As a result of the Redomestication, Bunge-Bermuda will become a direct, wholly-owned subsidiary of Bunge-Switzerland, and you will become a shareholder of Bunge-Switzerland. Your common shares of Bunge-Bermuda will be cancelled and you will receive,votes cast on a one-for-one basis with your Bunge-Bermuda shares that have been cancelled, new shares of Bunge-Switzerland.
You also are being asked toour annual say-on-pay vote on a proposal to adjourn the meeting to a later date to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Redomestication proposal.
Q: Why do you want to change your place of incorporation from Bermuda to Switzerland?
A: Bunge incorporatedwere in Bermuda in 1995 when the then-separate Bunge group of companies consolidated into a single company. Over the past few years, Bunge has done an extensive review of its business operations and the emerging trends in global tax environment. As part of this review, Bunge performed a substantial analysis of alternative jurisdictions in which it might redomesticate. Switzerland was determined to be the best jurisdiction in which to redomesticate because it allows Bunge to better align its corporate legal structure with its commercial operations. Switzerland is a jurisdiction that is well suited for global companies and offers a well-developed corporate, legal and regulatory environment.
As part of this review, Bunge has taken into account likely legislative tax changes proposed by the member states of the Organization for Economic Cooperation and Development (or "OECD") and in particular the Pillar 2 Model Rules, aiming at introducing a global minimum corporate tax rate of 15% on financial statement income. The focus of the OECD is to discourage multinational corporations from using low tax or no tax jurisdictions (tax havens) to avoid taxation.
As part of the Redomestication, Bunge will be locating its publicly traded parent company to Switzerland, a jurisdiction in which Bunge has operated for decades and for which we have significant substance. Switzerland is the home of many global companies, and if the Redomestication is approved, [●] will be located in a country with balanced corporate governance requirements, more sophisticated financial and commercial infrastructure as well as a stable and well-developed legal system.
Q: Will the Redomestication affect our current or future operations?
A: The Redomestication will have no significant impact on how we conduct our day-to-day operations. The locationsfavor of our future operations will depend on the needsexecutive compensation program.
Annually, we reach out to our top shareholders representing 40 - 50% of our business, independent of our legal domicile.
Q: Will the Redomestication dilute my economic interest?
A: No, the Redomestication will not dilute your economic interest in the Bunge Group. Immediately after the Redomestication, the number of issued and outstanding shares, of Bunge-Switzerland will be the same as the number of issued and outstanding shares of Bunge-Bermuda immediately before the completion of the Redomestication. Bunge-Switzerland will hold, in addition, [●] shares for future use to satisfy its obligations to deliver shares in connection with awards granted under our equity incentive plans and for such other purposeswell as Bunge-Switzerland's board of directors may determine. Bunge-Switzerland will assume Bunge-Bermuda’s existing obligation to deliver shares under our equity incentive plans. Because Bunge-Bermuda will be a wholly-owned subsidiary of Bunge-Switzerland after the Redomestication, your economic interest will not change in the Redomestication.
Q: Is the Redomestication taxable to me?
A: Determining the tax consequences of the Redomestication to you may be complex and will depend on your specific situation. The Redomestication is intended to be a “reorganization” under Section 368(a) of the U.S. Internal Revenue Code, where U.S. holders of shares of Bunge-Bermuda are generally not expected to recognize gain or loss on the exchange of such shares solely for shares of Bunge-Switzerland in the Redomestication. Under Swiss tax law, no Swiss tax is generally due for non-Swiss holders of Bunge-Bermuda shares on the ultimate receipt of
Bunge-Switzerland shares in the Redomestication. If you are a Swiss holder and are a beneficial owner of Bunge Limited shares, the Redomestication may result in Swiss tax consequences to you and you are therefore urged to contact your tax advisors. Other jurisdictions may tax holders on the ultimate receipt of shares in Bunge-Switzerland depending on the tax residence of the holder. We urge you to consult your tax advisor for a full understanding of the tax consequences of the Redomestication to you.
Q: Will there be Swiss withholding tax on future distributions, if any, by Bunge-Switzerland?
A: Because we will make distributions from qualifying capital contribution reserves, Swiss withholding tax should not apply to distributions paid to Bunge-Switzerland shareholders from Bunge-Switzerland for the foreseeable future.
Swiss federal withholding tax of 35% is generally due on distributions to Bunge-Switzerland shareholders from Bunge-Switzerland out of available earnings or other non-qualifying reserves for Swiss withholding tax purposes, regardless of the place of residency of the shareholder, subject to exceptions discussed below which we plan to use to substantially eliminate the Swiss withholding tax for the foreseeable future.
Distributions to shareholders in relation to a reduction of par value or paid out of qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration will be exempt from Swiss withholding tax. Bunge-Switzerland expects to pay distributions out of such qualifying capital contribution reserves for the foreseeable future, and as a result, any such distributions to shareholders will be exempt from the Swiss withholding tax. Upon completion of the Redomestication, we expect Bunge-Switzerland to have a par value of $[0.01] per share and qualifying capital contribution reserves per share recognized by the Swiss Federal Tax Administration, such that the combination of the two should approximate the market capitalization value of Bunge-Bermuda immediately prior to the completion of the Redomestication. It is estimated that the Swiss withholding tax would not be applicable for the foreseeable future.
After we have depleted qualifying capital contribution reserves, distributions will be subject to the 35% Swiss withholding tax. Bunge-Switzerland will be required to withhold at such rate and remit on a net basis any payments made to a holder of Bunge-Switzerland shares and pay such withheld amounts to the Swiss Federal Tax Administration. The shareholder may be entitled to a full or partial refund of the Swiss withholding tax, depending on where the holder is tax resident. You are urged to consult your tax adviser for a full understanding of the tax consequences.
Q: Will there be Swiss withholding tax on future share repurchases, if any, by Bunge-Switzerland?
A: Under Swiss law, repurchases of shares for the purposes of capital reduction are generally treated as a partial liquidation subject to 35% Swiss withholding tax, irrespective of the tax residency of the shareholder. However, the 35% Swiss withholding tax is not applicable to certain share repurchases, and we expect to utilize certain tax attributesproxy advisory firms and other arrangements to substantially reduce or eliminate this tax burden for the foreseeable future. The repurchase of shares for purposes other than capital reduction, such as to retain as treasury shares for use in connection with equity incentive plans, convertible debt, similar instruments or acquisitions, will not be subject to the 35% Swiss withholding tax. Any portion of the repurchase price attributable to par value or qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration will not be subject to the 35% Swiss withholding tax. Upon completion of the Redomestication, we expect Bunge-Switzerland to have a par value and qualifying capital contribution reserves for Swiss withholding tax purposes such that the combination of the two should result in a substantial reduction of the 35% Swiss withholding tax for the foreseeable future.
Q: What are qualifying capital contribution reserves?
A: Under Swiss statutory reporting requirements and for Swiss withholding tax purposes, qualifying capital contribution reserves represent, among other things, the amount per share by which the issue price of a share exceeds its par value. Qualifying capital contribution reserves may, subject to the restrictions described under “Description of Bunge-Switzerland Shares—Distributions” and “Description of Bunge-Switzerland Shares—Repurchases of Registered Shares,” be returned to shareholders, including through distributions and share repurchases. Distributions to shareholders out of qualifying capital contribution reserves that have previously been recognized by the Swiss Federal Tax Administration are exempt from Swiss withholding tax, as are distributions by virtue of a reduction of par value. Please note that qualifying capital contribution reserves for Bunge-Switzerland’s statutory reporting purposes and Swiss withholding tax purposes (which sometimes is also referred to as additional paid-in capital) will not be the same as additional paid-in capital reflected on Bunge-Switzerland’s consolidated financial statements prepared in accordance with U.S. GAAP.
Q: When do you expect the Redomestication to be completed?
A: We are working towards completing the Redomestication as quickly as possible and it remains subject to shareholder approval and the approval of the Bermuda Court. We currently expect to complete the Redomestication this year. However, the Redomestication may be delayed or otherwise abandoned if further events occur that cause our board of directors to determine that the Redomestication is no longer in the best interest of Bunge or its shareholders.
Q: What will I receive for my Bunge-Bermuda shares?
A: After the Redomestication, you will hold one Bunge-Switzerland share for each Bunge-Bermuda share you held immediately prior to the completion of the Redomestication.
Q: Do I have to take any action to exchange my Bunge-Bermuda shares?
A: No. Your Bunge-Bermuda common shares will be exchanged for Bunge-Switzerland shares without any action on your part. All of Bunge-Bermuda’s common shares are issued in uncertificated book-entry form. All of Bunge-Switzerland’s shares will also be issued in uncertificated book-entry form.
Q: May I trade Bunge-Bermuda shares between the date of this proxy statement and the Effective Date?
A: Yes. The Bunge-Bermuda shares will continue to trade during this period.
Q: After the Redomestication, where may I trade Bunge-Switzerland shares?
A: The Bunge-Switzerland shares will be listed and traded on the NYSE under the symbol “BG,” the same symbol under which your Bunge-Bermuda shares are currently listed.
Q: What vote of Bunge-Bermuda shareholders is required to approve the proposals?
A: The Redomestication proposal must be approved by the affirmative vote of holders of Bunge-Bermuda common shares representing a majority in number and at least 75% in value of the Bunge-Bermuda common shares present and voting at the meeting, whether in person or by proxy. The affirmative vote of holders of a majority of the Bunge-Bermuda common shares present in person or by proxy at the meeting and entitled to vote on the matter is required to approve the adjournment proposal. Please see “The Shareholders Meeting—Record Date; Voting Rights; Vote Required for Approval.”
Q: What vote does my board of directors recommend?
A: The Bunge-Bermuda board of directors unanimously recommends that Bunge-Bermuda’s shareholders vote “FOR” both of the proposals.
Q: How do I vote?
A: You may vote three ways:
•By telephone or online: If you are a shareholder of record, you may appoint your proxy by telephone, or electronically through the internet, by following the instructions on your proxy card.
•By mail: If you are a shareholder of record, you may appoint your proxy by marking, dating and signing your proxy card and returning it by mail in the enclosed postage-paid envelope.
•At the meeting: We will hold a meeting of our shareholders online via live webcast at [●], commencing at [●] local time, on [●], 2023. If you are planning to attend the virtual meeting, you may vote your shares at the meeting.
Q: May I submit my proxy by the Internet or telephone?
A: Yes. Instead of submitting your vote by mail on the enclosed proxy card, you may give your voting instruction by the Internet or telephone. Shareholders of record who do not hold their shares through a bank, broker or nominee may grant a proxy to vote on the Internet at [●] or by telephone by calling the number listed on the proxy card. Please have your proxy card in hand when calling or going online. If you hold your shares in the name of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee when voting your shares.
Q: What if I plan to attend the shareholder meeting?
A: The shareholder meeting will be a virtual meeting conducted exclusively online via live audio webcast, allowing shareholders to participate in the meeting from any location convenient to them. There will not be a physical meeting.
Even if you plan to virtually attend the shareholder meeting, we recommend that you submit your proxy anyway. If you are a holder of record, you may still attend the shareholder meeting and vote.
Q: How do I access the shareholder meeting?
A: To be admitted to the shareholder meeting visit [●] and enter the 16-digit control number found on your proxy card or voter instruction form. If you hold your common shares through a brokerage firm, bank or other nominee, you should follow the instructions provided by your brokerage firm, bank other holder of record to be able to participate in the meeting.
Q: What if I have trouble accessing the shareholder virtually?
A: The virtual meeting platform is fully supported across browsers (internet Explorer, Firefox, Chrome and Safari) and devices (desktops, laptops, tablets and cell phones) running the most updated version of applicable software and plugins. You should ensure that you have a strong internet connection wherever you intend to participate in the meeting. We encourage you to access the meeting prior to the start time. You will be able to log in beginning at [●], Central Time on [●], 2023. We will have a technician ready to assist you with any technical difficulties you may have accessing the shareholder meeting. If you encounter any difficulties accessing the shareholder meeting, please call the technical support number that will be posted on the virtual meeting platform login page.
Q: If I can't participate in the live shareholder webcast, can I vote or listen to it later?
A: You may vote your common shares before the meeting by following the instructions on your proxy card or voter instruction form. You do not need to access the webcast to vote if you submitted your vote via proxy in advance of the shareholder meeting. We do not intend to record the shareholder meeting; however, we will disclose the results on a Form 8-K that we will file with the SEC within four business days of the shareholder meeting.
Q: If my shares are held in “street name” by my broker, will my broker vote my shares for me?
A: No. We recommend that you contact your broker. Your broker can give you directions on how to instruct the broker to vote your shares. Your broker may not be able to vote your shares unless the broker receives appropriate instructions from you.
Q: If my shares are held “street name” by my broker, how do I register in advance to access the shareholder meeting?
A: If you are a registered holder of common shares (i.e., you hold your shares through our transfer agent, (Computershare), you do not need to register in advance to access the shareholder meeting. Please follow the instructions described above and on your proxy card or voter instruction form that you received.
If you hold your common shares through a brokerage firm, bank or other nominee, you should follow the instructions provided by your brokerage firm, bank or other holder of record to be able to participate in the meeting.
Q: May I change my vote after I grant my proxy?
A: Yes. You may change your vote at any time before your proxy is voted at the meeting. You may revoke your proxy any time prior to its exercise by:
•giving written notice of the revocation to the Corporate Secretary of Bunge-Bermuda;
•if you are a holder of record, or a beneficial holder with a proxy from the holder of record, by accessing and voting at the shareholder meeting;
•revoking the proxy by telephone or the Internet; or
•properly completing and executing a later-dated proxy and delivering it to the Corporate Secretary of Bunge-Bermuda at or before the meeting.
If you have instructed a broker to vote your shares, you must follow the procedure provided by your broker to change those instructions.
Your attendance alone will not revoke your proxy. To revoke a proxy, you must take one of the actions described above. Any written notice of revocation must be sent to the attention of the Bunge-Bermuda Corporate Secretary at 1391 Timberlake Manor Parkway, Chesterfield, Missouri 63017, U.S.A.
Q: Are proxy materials available on the Internet?
A: Yes.
Q: Whom should I call if I have questions about the meeting or the Redomestication?
A: You should contact either of the following:
Bunge-Bermuda:
Ruth Ann Wisener
Investor Relations
1391 Timberlake Manor Parkway
Chesterfield, Missouri 63017, U.S.A.
Phone: (636) 292-3014
our proxy solicitor:
[●]
industry thought leaders.
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SUMMARY97% of Shareholders voted FOR Say-on-Pay at our 2022 Annual General Meeting | | | Engagement Methods | | | Engagement Topics | | | Who Participates |
| | •Individual investor meetings •Annual meeting of shareholders •Quarterly earnings calls •Informational materials and public filings | | | •Company Overview •Business Highlights •Corporate Governance •Diversity & Inclusion •Sustainability •Executive Compensation | | | •Board of Directors •Executive Leadership Team •Investor Relations •Subject Matter Experts
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Engage institutional investors representing 40 - 50% of issued and outstanding shares | | | | | | |
This summary highlights selected information from this proxy statement. It does not contain allFurther, in 2022 we commenced in-depth consultations, led by a leading ESG advisory organization, with a consortium of the information that is importantinvestors to you. To understand the Redomestication more fully,support our efforts to enhance transparency around our sustainability strategy, performance and for a more complete legal description of the Redomestication, you should read carefully the entire proxy statement, including the annexes. The Scheme of Arrangement attached as Annex A to this proxy statement is the legal document that outlines the Redomestication. The articles of association and organizational regulations of Bunge-Switzerland summarized herein will govern our company after the completion of the Redomestication. We encourage you to read those documents and summaries. Unless otherwise indicated, currency amounts in this proxy statement are stated in United States dollars.
Parties to the Redomestication
Bunge-Bermuda: Bunge-Bermuda is an exempted company limited by shares incorporated under the laws of Bermuda. We are registered with the Registrar of Companies in Bermuda under registration number EC20791. We trace Bunge’s history back to 1818 when we were founded as a trading company in Amsterdam, The Netherlands. We are a holding company and substantially all of our operations are conducted through our subsidiaries. Our corporate headquarters are located at 1391 Timberlake Manor Parkway, Chesterfield, Missouri, 63017, United States of America, and our telephone number is (314) 292-2000. Our registered office is located at 2 Church Street, Hamilton, HM 11, Bermuda.
Bunge-Switzerland: Bunge-Switzerland is a newly formed Swiss company and is currently wholly-owned by Bunge-Bermuda. Bunge-Switzerland has not engaged in any business or other activities other than in connection with its formation and the Redomestication. As a result of the Redomestication, Bunge-Switzerland will become the ultimate parent company of the Bunge Group, including Bunge-Bermuda.
The registered office and principal executive office of Bunge-Switzerland are located at Route de Florissant 13 1206 Geneva, Switzerland. The telephone number of Bunge Switzerland is +41 22 592 91 00.
Bunge-MergerCo: Bunge-MergerCo is a Bermuda exempted company newly formed for the purpose of merging with Bunge-Bermuda in the Redomestication, with Bunge-Bermuda as the surviving company. Bunge-MergerCo is a direct, wholly-owned subsidiary of Bunge-Switzerland. Bunge-MergerCo has not engaged in any business or other activities other than in connection with its formation and the Redomestication.
The registered office and principal executive office of Bunge-MergerCo are located at 2 Church Street, Hamilton, HM 11, Bermuda. The telephone number of Bunge MergerCo is [●].
The Redomestication (see page [●])
The Redomestication will effectively change our place of incorporation from Bermuda to Geneva, Switzerland.
The Redomestication involves several steps. First, we have formed Bunge-Switzerland as a direct, wholly-owned subsidiary of Bunge-Bermuda. Bunge-Switzerland, in turn, has formed Bunge-MergerCo, a new Bermuda subsidiary. Following the Bunge-Bermuda shareholders' meeting to be held on [●], 2023 and a hearing of the Bermuda Court scheduled for [●], 2023, and assuming we have obtained the necessary shareholder and court approvals, Bunge-MergerCo will merge with Bunge-Bermuda by way of the Scheme of Arrangement, with Bunge-Bermuda as the surviving company. As a result of the Redomestication Bunge-MergerCo will cease to exist, and Bunge-Bermuda will become a direct, wholly-owned subsidiary of Bunge-Switzerland. Effective for the date that is one day after the Effective Date, Bunge-Bermuda will make a U.S. tax election to be treated as a disregarded entity for U.S. tax purposes.
After the Redomestication, you will continue to own an interest in a parent company that will continue to conduct the business operations as conducted by Bunge-Bermuda before the Redomestication. The number of shares you will own in Bunge-Switzerland will be the same as the number of shares you owned in Bunge-Bermuda immediately prior to the Redomestication, and your relative economic interest in the Bunge Group will remain unchanged.
engagement.
87 Bunge | 2023 Proxy Statement
Reasons for the Redomestication (see page [●])
The decision by the Board of Directors to complete the Redomestication follows an extensive review of our business operations and emerging trends in the global tax environment. Switzerland was determined to be the best jurisdiction to redomesticate as it allows Bunge to better align its corporate legal structure with Bunge’s commercial operations. Switzerland is also a jurisdiction that is well suited for global companies and offers a well-developed corporate, legal and regulatory environment.
Tax Considerations (see page [●])
Determining the tax consequences of the Redomestication to you may be complex and will depend on your specific situation. The Redomestication is intended to be a “reorganization” under Section 368(a) of the U.S. Internal Revenue Code, where U.S. holders of shares of Bunge-Bermuda are generally not expected to recognize gain or loss on the exchange of such shares solely for shares of Bunge-Switzerland in the Redomestication. Under Swiss tax law, no Swiss tax is generally due for non-Swiss holders of Bunge-Bermuda shares on the ultimate receipt of Bunge Switzerland shares in the Redomestication. If you are a Swiss holder and are a beneficial owner of Bunge Limited shares, the Redomestication may result in Swiss tax consequences to you and you are therefore urged to contact your tax advisors. Other jurisdictions may tax holders on the ultimate receipt of shares in Bunge-Switzerland depending on the tax residence of the holder. We urge you to consult your tax advisor for a full understanding of the tax consequences of the Redomestication to you.
Rights of Shareholders (see page [●])
Most of the principal attributes of Bunge-Bermuda’s common shares and Bunge-Switzerland’s registered shares will be similar. However, there are differences between your rights under Swiss law and under Bermuda law. In addition, there are differences between Bunge-Bermuda’s constituent documents and Bunge-Switzerland’s proposed constituent documents. We discuss these differences in detail under “Description of Bunge-Switzerland Shares” and “Comparison of Rights of Shareholders.”
Stock Exchange Listing (see page [●])
Immediately following the Redomestication, the shares of Bunge-Switzerland will be listed on the New York Stock Exchange under the symbol “BG,” the same symbol under which the Bunge-Bermuda common shares are currently listed.
Court Approval of the Redomestication (see page [●])
If shareholders of Bunge-Bermuda approve the Redomestication, a request will be filed with the Bermuda Court to approve the Redomestication. The Bermuda Court may impose such conditions as it deems appropriate in relation to the Redomestication but may not impose any material changes without the joint consent of Bunge-Bermuda, and Bunge-Switzerland. In determining whether to exercise its discretion and approve the Redomestication, the Bermuda Court will be required to determine, among other things, whether the Scheme of Arrangement is fair to Bunge-Bermuda’s shareholders in general and might reasonably have been approved by a shareholder of Bunge-Bermuda acting in his own interests.
Market Price and Dividend Information (see page [●])
On [●], the last trading day before the public announcement of the Redomestication, the closing price of the Bunge-Bermuda common shares on the New York Stock Exchange was $[●] per share. On [●], the most recent practicable date before the date of this proxy statement, the closing price of the Bunge-Bermuda common shares was $[●] per share.
No Appraisal Rights (see page [●])
Under Bermuda law, the shareholders of Bunge-Bermuda do not have any right to an appraisal of the value of their shares or payment for them in connection with the Redomestication.
Accounting Treatment of the Redomestication (see page [●])
Under U.S. GAAP, the Redomestication represents a transaction between entities under common control. Assets and liabilities transferred between entities under common control are accounted for at cost. Accordingly, the assets and liabilities of Bunge-Switzerland will be reflected at their carrying amounts in the accounts of Bunge-Bermuda under U.S. GAAP on the Effective Date.
Shareholders Meeting (see page [●])
Time, Place, Date and Purpose: The shareholders meeting will be held online via live webcast at [●], commencing at [●] local time, on [●]. At the meeting, Bunge-Bermuda’s board of directors will ask the shareholders to vote to approve:
•the Redomestication, which will be effected by the Scheme of Arrangement, in connection with the Agreement and Plan of Merger, pursuant to which Bunge-Bermuda would merge with Bunge-MergerCo, with Bunge-Bermuda as the surviving company, and each holders of Bunge-Bermuda common shares will receive Bunge-Switzerland shares on a one-for-one basis;
•a motion to adjourn the meeting to a later date to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Redomestication; and
•any other matters that properly come before the meeting and any adjournments or postponements of the meeting.
Record Date: Only holders of record of Bunge-Bermuda common shares on [●] are entitled to notice of and to vote at the meeting or any adjournment or postponement of the meeting.
Quorum: The holders of more than 50% of our issued and outstanding voting common shares throughout the meeting will constitute a quorum. Abstentions and “broker non-votes” will be counted toward the presence of a quorum, but will not be considered votes cast on any of the proposals brought before, the special meeting.
Financial Statements
Pro forma financial statements for Bunge-Switzerland are not presented in this proxy statement because no significant pro forma adjustments are required to be made to the historical consolidated statement of operations of Bunge-Bermuda for the year ended December 31, 2021. Those financial statements are included in Bunge-Bermuda’s Annual Report on Form 10‑K for the year ended December 31, 2021.
Recommendation of the Board of Directors
The Bunge-Bermuda board of directors unanimously recommends that Bunge-Bermuda’s shareholders vote “FOR” the Redomestication. The Bunge-Bermuda board of directors also unanimously recommends that Bunge-Bermuda’s shareholders vote “FOR” the adjournment proposal, which is not a condition to the Redomestication.
Required Vote (see page [●])
Approval of the Redomestication requires the affirmative vote of holders of Bunge-Bermuda common shares representing a majority in number and at least 75% in value of the Bunge-Bermuda common shares present in person or by proxy at the meeting and entitled to vote on the matter. The affirmative vote of holders of at least a majority of the Bunge-Bermuda common shares present in person or by proxy at the meeting and entitled to vote on the matter is required to approve the adjournment proposal. See “The Shareholders Meeting—Record Date; Voting Rights; Vote Required for Approval.”
Proxies (see page [●])
General: A proxy card is being sent to each shareholder as of the record date. If you properly received a proxy card, you may grant a proxy to vote on the proposals by marking your proxy card appropriately, executing it in the space provided, dating it, and returning it to us. If you hold your shares in the name of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee when voting your shares. If you have timely submitted a properly executed proxy card or provided your voting instructions by telephone or on the Internet and clearly indicated your votes, your shares will be voted as indicated.
Revocation: You may revoke your proxy card at any time prior to its exercise by:
•giving written notice of the revocation to the Corporate Secretary of Bunge-Bermuda;
•if you are a holder of record, or a beneficial holder with a proxy from the holder of record, by accessing and voting at the shareholder meeting;
•voting again by telephone or the Internet; or
•properly completing and executing a later-dated proxy and delivering it to the Corporate Secretary of Bunge-Bermuda at or before the meeting.
However, your attendance alone will not revoke your proxy.
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RISK FACTORSPROPOSAL 1 — ELECTION OF DIRECTORS |
Before you decide how to vote
Election of Directors
Our Board, based on the Redomestication, you should carefully considerrecommendations of the following risk factors, in additionCorporate Governance and Nominations Committee, has nominated each of the eleven nominees listed below for election at the Annual General Meeting and to the other information contained in this proxy statementcommittees and roles indicated, each to hold office until next year's annual general meeting. Mr. Paul Fribourg resigned from the Board effective December 31, 2022, and, as part of the Board's succession strategy, Mr. Erik Fyrwald and Ms. Kathleen Hyle have chosen to not stand for re-election at the Annual General Meeting.
Each of Messrs. Heckman and Winship were initially selected as a director pursuant to the respective Cooperation Agreements with Continental Grain Company, D.E. Shaw Valence Portfolios, L.L.C. and D.E. Shaw Oculus Portfolios, L.L.C., each of which expired on November 12, 2019. While the selection of Messrs. Heckman and Winship is no longer required, the Corporate Governance and Nominations Committee and the documents incorporatedBoard believe they are qualified nominees who are committed to promoting the long-term interests of our shareholders. Other than Mr. Fransen and Ms. McGurk, each nominee is presently a member of the Board. Each nominee has agreed to serve if elected.
Nominees
The Board believes that the nominees possess the requisite tenure, diversity and variety of complementary skills, qualifications, backgrounds and experience that contribute to the Board's ability to oversee our operations and to shape our long-term business strategy. The following director nominee skills matrix is a high-level summary which highlights the top four skills of each director nominee and is not intended to be an exhaustive list of each director nominee’s skills or contributions to the Board. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Aleixo
Lustosa | Bair | Browner | Fransen | Heckman | Hees | Kobori | McGurk | Simril | Winship | Zenuk |
| Key Skills and Experience | | | | | | | | | | | |
| Public Company CEO Experience | | | | | P | P | | | | | |
| Financial | P | P | | P | | P | | | P | P | P |
| Risk Management | P | P | P | P | P | | P | P | | P | P |
| South America Business Expertise | P | | | | | P | | | | | |
| China Business Expertise | | P | | | | | | | | | |
| Agricultural Industry | | | | | P | | P | | P | P | P |
| Food Ingredient | | | | | P | | | P | P | | |
| Digital | | | | P | | | | P | | | |
| Manufacturing and Logistics | | | | P | | P | P | | P | P | P |
| Government and Public Policy | P | P | P | | | | | | | | |
| Sustainability | | | P | | | | P | P | | | |
| Tenure and Independence | | | | | | | | | | | |
| Board Tenure (Years Completed) | 0 | 3 | 9 | 0 | 4 | 3 | 1 | 0 | 1 | 4 | 4 |
| Independent | P | P | P | P | | P | P | P | P | P | P |
| Demographics | | | | | | | | | | | |
| Age | 60 | 68 | 67 | 65 | 60 | 53 | 63 | 53 | 57 | 55 | 55 |
| Gender Identity | F | F | F | M | M | M | M | F | M | M | M |
| Asian | | | | | | | P | | | | |
| Black/African American | | | | | | | | | P | | |
| Hispanic/Latino | P | | | | | P | | | | | |
| White/Caucasian | | P | P | P | P | | | P | | P | P |
Nationality(1) | BR | US | US | UK | US | BR/US | US | US | US | US | CA/US |
(1) For Nationality, BR = Brazil, US = United States, UK = United Kingdom and CA = Canada
Bunge | 2023 Proxy Statement 8
The following paragraphs set forth information about the nominees and their expected committee memberships and roles following the Annual General Meeting.
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Eliane Aleixo Lustosa de Andrade, 60 Board Member since 2022
Committees: Audit; Sustainability and Corporate Responsibility
| Ms. Aleixo Lustosa most recently served as Managing Director at the Brazilian Development Bank, National Bank for Economic and Social Development, where she was responsible for capital markets and the execution of the Brazilian Privatization Program. Earlier in her career, she was the Chief Financial Officer of LLX Logística S.A. (currently Prumo Logística S.A.), Vice President of Finance and Control of Grupo Abril S.A., Executive Director of Globex Utilidades S.A. and Chief Investment Officer of the Petrobras’ Employee Pension Fund. Ms. Aleixo Lustosa currently serves as a non-employee director of the following companies: Grupo CCR S.A., BrasilAgro S.A., and Aegea Saneamento S.A. She has been a referee of the Brazilian Arbitration Chamber of Novo Mercado Bovespa - B3 - Brazilian Stock Market, since 2004, and is member of the Bluebell Index advisory board. Ms. Aleixo Lustosa has a Ph.D in Finance and Master’s of Arts and Bachelor of Arts degrees in Economics from Pontifical Catholic University of Rio de Janeiro, Brazil, where she later served as a professor of microeconomics and international relations. She has two Board Member Certificates, one issued by Competent Boards – Global ESG & Climate Certificate & Designation Program and one issued by the Brazilian Institute of Corporate Governance, where she also teaches Corporate Governance.
Skills and Qualifications: Ms. Aleixo Lustosa brings to the Board significant experience in global capital markets and financial risk management, as well as regulation and public policy and advising large, complex organizations in both the public and private sectors. She also has experience and insights into South America capital and energy markets. |
Sheila Bair, 68 Board Member since 2019
Deputy Chair since 2021
Committees: Audit; Corporate Governance and Nominations (Chair); Enterprise Risk Management
| Ms. Bair is the former Chair of the Federal Deposit Insurance Corporation (FDIC), where she served in that capacity from 2006 to 2011. After leaving the FDIC, she joined the Pew Charitable Trust as a senior advisor, a role she held from 2011 through 2015. Ms. Bair also served as president of Washington College from 2015 to 2017, and senior advisor to the international law firm DLA Piper, from 2014 to 2015. Earlier in her career, she also served as Assistant Secretary for Financial Institutions at the U.S. Department of the Treasury (2001 to 2002), Senior Vice President for Government Relations of the New York Stock Exchange (1995 to 2000), Commissioner of the Commodity Futures Trading Commission (1991 to 1995), and as counsel to Kansas Republican Senate Majority Leader Bob Dole (1981 to 1988). She continues her work on public policy issues as chair emeritus of the Systemic Risk Council, as a founding director of the Volcker Alliance, and as a Senior Fellow of the Center for Financial Stability. Ms. Bair is a non-employee director of Lion Electric Company, where she serves as a member of the Compensation Committee and chairs the Nomination and Corporate Governance Committee. She is a former Board Chair of Fannie Mae and non-employee director of Host Hotels & Resorts, Inc., Thomson Reuters and the Industrial and Commercial Bank of China Ltd. She is an accomplished author and has written several books on financial issues. In 2021, she was appointed trustee of the prestigious Economists for Peace and Security, and the Eminent Persons Group, which advises the IFRS Foundation on sustainability financial disclosures. She holds a bachelors from the University of Kansas and a J.D. from the University of Kansas School of Law. She also holds honorary doctorates from Kansas University, Amherst College and Drexel University. Skills and Qualifications: Ms. Bair brings to the Board significant experience in global capital markets and financial risk management, as well as regulation and public policy, and advising large, complex organizations in both the public and private sectors. |
9 Bunge | 2023 Proxy Statement
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Carol Browner, 67 Board Member since 2013
Committees: Corporate Governance and Nominations; Sustainability and Corporate Responsibility (Chair)
| Ms. Browner is senior of counsel at Covington & Burling LLP, a multinational law firm, and is a member of their environmental, social and governance practice. From 2011 to 2021, Ms. Browner was senior counsel at Albright Stonebridge Group, a global advisory firm. From 2009 to 2011, she served as Assistant to President Barack Obama and director of the White House Office of Energy and Climate Change Policy. From 2001 to 2008, Ms. Browner was a founding principal of the Albright Group and Albright Capital Management LLC. Previously, she served as Administrator of the Environmental Protection Agency from 1993 to 2001. She also chairs the board of the League of Conservation Voters and is a sustainability advisor to Neutron Holdings, Inc., d/b/a Lime. She holds a J.D. and B.A. from the University of Florida. Skills and Qualifications: Ms. Browner brings to the Board significant experience in regulation and public policy, the environment and sustainability, particularly with respect to agriculture, energy and renewable fuels, and also advising large, complex organizations in both the public and private sectors. |
David Fransen, 65 Board Nominee
Committees:
Enterprise Risk Management; Human Resources and Compensation
| Mr. Fransen was Chairman and non-employee director of Vitol S.A., Geneva, from 2017 until his retirement from Vitol in 2020. Prior to that, Mr. Fransen worked at Vitol Group from 1986 to 2017 serving as a director of various Vitol Group companies and holding roles of increasing responsibility, including leading the global gasoline trading group; heading the Bermuda office; Group Head of Information Technology; Chief Operations Officer; and Member of the Executive Committee. Early in his career, he worked at British Petroleum PLC (1979-1986) in marketing and planning and as a trader. Mr. Fransen was a founding member of the Swiss Trading and Shipping Association from 2006 to 2019, and served as President for 6 years. Mr. Fransen is a former non-employee director of Greenfields Petroleum. Mr. Fransen holds a BSC (Hons) in Mathematics and Computer Science from Royal Holloway College, London, and a Certificate in Management Studies.
Skills and Qualifications: Mr. Fransen brings to the Board significant experience in finance and risk management, particularly with respect to energy markets in the U.S., Europe and South America. He also has significant experience with information technology, digital applications and cybersecurity, establishing and leading the information technology team of a large and complex Swiss multinational company. He also brings valuable experience in transportation and logistics, as well as leading a large and complex energy company. |
Bunge | 2023 Proxy Statement 10
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Gregory Heckman, 60 Board Member since 2018
| Mr. Heckman has served as Bunge Limited's CEO since 2019 and a director since October 2018. Mr. Heckman is Founding Partner of Flatwater Partners, a private investment firm, and has over 30 years of experience in the agriculture, energy and food processing industries. He served as CEO of The Gavilon Group from 2008 to 2015. During his time at Gavilon, he led the company through a period of considerable growth in both the agriculture and energy industries prior to the eventual sale of the agriculture business to Marubeni Corporation and the energy business to NGL Energy Partners. Prior to Gavilon, Mr. Heckman was Chief Operating Officer of ConAgra Foods Commercial Products and President and COO of ConAgra Trade Group. Mr. Heckman also serves as a non-employee director on the board of OCI NV, a global producer of fertilizer and chemicals. He is also a member of the North America Agribusiness Advisory Board of Rabobank, the New York Stock Exchange Board Advisory Council and the Aksarben Foundation Board of Governors. Mr. Heckman holds a B.S. in agriculture economics and marketing from the University of Illinois at Urbana-Champaign. Skills and Qualifications: Mr. Heckman's deep agribusiness and food industry knowledge and leadership experience, his proven track record in driving growth and shareholder value at Bunge and previous businesses he has led, as well as his experience as our CEO, provides the Board with valuable perspectives as we continue to grow our portfolio of businesses, while increasing our focus on sustainability and optimizing our operation and risk management execution.
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Bernardo Hees, 53 Board Member since 2019
Committees: Human Resources and Compensation; Sustainability and Corporate Responsibility
| Mr. Hees was a partner at 3G Capital, a global investment firm, from 2010 until the end of 2019. Mr. Hees served as CEO of The Kraft Heinz Company from July 2015 until June 2019 and as CEO of H.J. Heinz Company from June 2013 until its merger with Kraft Foods Group, Inc. in July 2015. Previously, Mr. Hees served as CEO of Burger King Worldwide Holdings, Inc., a global fast food restaurant chain, from September 2010 to June 2013 and Burger King Worldwide, Inc. from June 2012 to June 2013, and as CEO of América Latina Logística, a logistics company, from January 2005 to September 2010. Mr. Hees serves as Executive Chairman of the Board of Directors of Avis Budget Group, Inc. He holds a B.A. in Economics from the Pontifical Catholic University of Rio de Janeiro and an MBA from Warwick Business School in the United Kingdom. Skills and Qualifications: Mr. Hees' experience as a former chief executive of a large international consumer products company and his experience as a former partner of a global investment firm provides the Board with valuable perspective relating to global food and food ingredient supply chains. He also provides the Board with insights into the South American marketplace. He has a finance background, and a strong understanding of compensation and sustainability matters.
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11 Bunge | 2023 Proxy Statement
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Michael Kobori, 63 Board Member since 2021
Committees: Enterprise Risk Management; Sustainability and Corporate Responsibility
| Mr. Kobori is currently the Chief Sustainability Officer at Starbucks Coffee Company, a position he has held since 2020. Prior to joining Starbucks, he was with Levi Strauss & Co. where he served as Vice President, Sustainability from 2007 to 2020 and the Director, Global Code of Conduct from 2001 to 2006. Prior to that, he was with The Asia Foundation, where he supported human rights and economic development in Bangladesh, Thailand and Vietnam. Mr. Kobori currently serves on the Advisory Committee for Voluntary Foreign Assistance and the President's Leadership Council of The Asia Foundation. Mr. Kobori has been a lecturer in corporate sustainability at the Haas School of Business, University of California at Berkeley. He is the Executive Producer of Utopia Theatre Project, an artist-led social justice theater company. Mr. Kobori has served on a number of not-for profit boards and advisory commissions, including the Cotton Board, Better Cotton Initiative, Sustainable Apparel Coalition, ILO Better Work, and Levi Strauss Foundation. He holds a Masters of Public Policy and AB, Psychology and Asian Studies degrees from the University of California, Berkeley. Skills and Qualifications: Mr. Kobori brings to the Board significant experience in environmental matters, sustainability and public policy, particularly with respect to climate, agriculture and water. He also has experience working for a large multinational beverage and manufacturing company with complex supply chains. In addition, his extensive experience in the private sector provides unique perspectives on diversity and social justice matters. He also provides the Board with insights on business operations in Asia. |
Monica McGurk, 53 Board Nominee
Committees: Corporate Governance and Nominations; Enterprise Risk Management
| Ms. McGurk is currently the Chief Executive Officer of Tropicana and Mainstream Brands at Tropicana Brands Group, a position she has held since September 2022. Previously, she served as the Chief Global Growth Officer at Kellogg Company from 2019 to 2022 and the Chief Global Revenue and eCommerce Officer from 2018 to 2019. Prior to working at Kellogg Company, she worked at Tyson Foods and The Coca-Cola Company where she held various leadership positions in strategy and digital media. She is currently a non-employee director of the privately held company, PivotBio. Ms. McGurk holds a B.A. in Government from Harvard University and a M.B.A. and Certificate in Public Management along with a M.A. in Education from Stanford University. Additionally, she completed the Executive Education Agribusiness Seminar at Harvard Business School; Ethics of AI at the University of Helsinki, Finland; and Introduction to ESG at the Corporate Finance Institute.
Skills and Qualifications: Ms. McGurk brings to the Board significant experience in enterprise risk management, ESG, health and nutrition, food waste and packaging, as well as diversity, equity and inclusion initiatives at large multinational companies. She also has significant experience in digital, cybersecurity and AI. In addition, she also has significant leadership experience in each of these areas, including strategy and commercial initiatives globally. |
Bunge | 2023 Proxy Statement 12
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Kenneth Simril, 57 Board Member since 2021
Committees: Audit; Human Resources and Compensation (Chair)
| Mr. Simril is the former President and Chief Executive Officer of Fleischmann's Ingredients, a position he held from 2006 to 2021. Prior to joining Fleischmann's, he was the Chief Financial Officer and Chief Operations Officer of Clipper Corporation, a manufacturer of both custom and semi-custom items for the food service industry. Before Clipper Corporation, Mr. Simril was the Chief Financial Officer of ClearPath Networks Inc. He has also served in various finance and engineering roles with Mobil Oil Corporation and Exxon Mobil Corporation. Mr. Simril is a former non-employee director of At Home Group, Inc. He currently serves as an independent director of American Funds managed by the Capital Group, a privately held company. He holds a B.S. in Petroleum Engineering from the University of Southern California and an MBA from Harvard Business School.
Skills and Qualifications: Mr. Simril brings to the Board significant financial and leadership expertise and experience working for large, complex multinational companies. In addition, he brings significant food and ingredients experience, manufacturing, logistics, strategic and investment management experience. Mr. Simril is an audit committee financial expert. |
Henry "Jay" Winship, 55 Board Member since 2018
Committees: Audit (Chair); Corporate Governance and Nominations; Human Resources and Compensation
| Since 2016, Mr. Winship has served as Founder, President and Managing Member of Pacific Point Capital, a privately owned asset management firm. Prior to that, he was a Principal, Senior Managing Director and Member of the Investment Committee at Relational Investors, which he joined in 1996. He has over 25 years of experience as an institutional investor and in investment management, accounting and financial management. Mr. Winship is a non-employee director of C.H. Robinson and former non-employee director of CoreLogic, Inc. He also serves on the Board of Advisors of the Corporate Governance Institute at San Diego State University Fowler College of Business. He is a Certified Public Accountant and holds the professional designation of Chartered Financial Analyst. He holds a bachelor's degree in finance from the University of Arizona and an MBA from the University of California, Los Angeles.
Skills and Qualifications: Mr. Winship brings to the Board expertise and experience as an institutional investor helping to grow shareholder value at a wide range of public companies. Mr. Winship has significant experience in the areas of finance, capital allocation and risk management, and provides our Board with valuable perspectives on a range of agricultural and food ingredient industry topics. Mr. Winship is an audit committee financial expert and has extensive corporate governance expertise. |
13 Bunge | 2023 Proxy Statement
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Mark Zenuk, 55 Board Member since 2018
Board Chair (following Annual General Meeting)
Committees: Enterprise Risk Management (Chair)
| Mr. Zenuk has served as Managing Partner of Tillridge Global Agribusiness Partners, an agribusiness private equity firm, since 2016. Prior to Tillridge, he was a Managing Director at NGP Energy Capital Management where he led the agribusiness investment platform from 2010 to 2016. Before joining NGP Energy Capital Management, he served in many domestic and international executive leadership roles with Archer Daniels Midland Company ("ADM"), having most recently led ADM’s oilseed business unit. Before joining ADM in 1999, he served as General Manager of the Commodity Marketing Group for the Saskatchewan Wheat Pool and Marketing Manager for the Canadian Wheat Board. He holds a B.S. in Agricultural Economics from the University of Saskatchewan.
Skills and Qualifications: Mr. Zenuk's senior leadership experience provides deep knowledge of global agribusiness and food and ingredients markets, along with risk management expertise and, through his private equity experience, financial acumen and a strong commitment to strategic growth and shareholder value. Mr. Zenuk also brings manufacturing and logistics experience in global operations. |
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| R | OUR BOARD RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF EACH OF THE NOMINEES FOR DIRECTOR. |
Bunge | 2023 Proxy Statement 14
The following sections provide an overview of our corporate governance policies and practices, including with respect to shareholder outreach, Board structures, tenure and refreshment, independence of directors, Board leadership, risk oversight and key aspects of our Board and committee operations. The Board regularly reviews our policies and processes in the context of current corporate governance trends, regulatory changes and recognized best practices.
Shareholder Engagement
Shareholder engagement is a key priority of our Board and management. As a result, the Board has worked with management over the years to develop a robust year-round shareholder outreach program with our investors. Similar to previous years, we engaged with institutional investors representing approximately 40% to 50% of our issued and outstanding shares, including most of our top 20 institutional holders, to gain valuable insights into current and emerging issues that matter most to them, including with respect to our performance and strategy, governance matters, executive compensation, sustainability, climate, human capital management, diversity and inclusion and other matters. These meetings included members of our management team, including investor relations, human resources, executive compensation, sustainability and legal, as well as our independent Board chair and select committee chairs. Additionally, beginning in 2021, we began participating in a program led by reference, including, without limitation,an ESG advisory organization to meet with a consortium of investors to discuss our Annual Report on Form 10-K for the year ended December 31, 2021sustainability strategy and subsequent filings with the SEC.
Your rightsperformance, as a shareholder will changeway to provide greater transparency into our sustainability efforts.
Feedback from these discussions is relayed to the Board and is a key element in the development of our governance, compensation and sustainability policies, as well as the ongoing evaluation of our business strategy and performance.
For example, as a result of feedback received and collaboration with our shareholders in recent years we have:
•taken significant action to refresh our Board and the Redomestication.leadership and composition of our Board committees;
Because of differences between Swiss law and Bermuda law, your rights as a shareholder will change if the Redomestication is completed. For a description of these differences, see “Comparison of Rights of Shareholders.”•made meaningful changes to our executive compensation program;
As a result of increased shareholder approval requirements, Bunge-Switzerland will have less flexibility than Bunge-Bermuda•amended our bye-laws to eliminate certain supermajority voting standards;
•enhanced our proxy disclosures with respect to certain aspectsthe composition, skill sets and diversity of capital management.our Board;
Under Bunge-Bermuda’s bye-laws, Bunge-Bermuda’s•enhanced our sustainability policies and programs, particularly with respect to addressing deforestation risks in our supply chain, climate-related risks and water sustainability;
•updated our Corporate Governance Principles to enhance our Board Membership Criteria, including the addition of a Diversity Policy and director succession planning;
•updated our committee charters to clarify the roles and responsibilities with respect to ESG matters;
•enhanced our sustainability, risk, compensation and governance disclosures to align them to the relevant elements of the reporting frameworks developed by the Sustainability Accounting Standards Boards (SASB) and the Task Force on Climate-related Financial Disclosures (TCFD); and
•implemented full declassification of our Board.
The Board will continue to seek investor input in furtherance of its commitment to enhancing our governance practices and building long-term shareholder value.
Board Structure and Size
As of the date of this proxy statement, our Board consists of 11 directors. Directors may issue, without shareholder approval, any common shares authorized in Bunge-Bermuda’s memorandumare elected at each annual general meeting of association that are not issued or reserved. Bermuda law and Bunge-Bermuda’s bye-laws also provide substantial flexibility in establishing the terms of preferred shares. In addition, Bunge-Bermuda’s Board of Directors has the right, subject to statutory limitations, to declare and pay dividends on Bunge-Bermuda’s common shares without a shareholder vote. Swiss law allows Bunge-Switzerland’s shareholders to authorize share capital that can be issuedhold office for one-year terms until the next annual general meeting of shareholders.
15 Bunge | 2023 Proxy Statement
Director Selection and Qualifications
Our Board maintains a robust process in which the members focus on identifying, considering and evaluating potential board candidates. As provided in its charter, our Corporate Governance and Nominations Committee leads this process by considering prospective candidates at its meetings. In identifying appropriate candidates, with support from an independent search firm, the board of directors without shareholder approval, but this authorization is limited to (i) 50% of Bunge-Switzerland's stated share capital (e.g., the issuance of shares in connection with an acquisition) and (ii) an additional 50% of Bunge-Switzerland's stated share capital for the issuance of shares in connection with convertible or similar financial instruments and our equity incentive plans. The authoritycommittee conducts a thoughtful evaluation focused on recommending candidates, pursuant to the Board of Directors to issue shares for such purposes must be renewed by the shareholders every five years. Additionally, Swiss law grants existing shareholders preemptive rights to subscribe for newly issued sharesMembership Criteria and advance subscription rights to subscribe for convertible and similar financial instruments. Preemptive rights and advance subscription rights may be limited or withdrawn for valid reasons. Swiss law also does not provide as much flexibilityDiversity Policy set forth in the various termsCorporate Governance Principles, that can attach to different classes of shares. Swiss law also reserves for approval by shareholders many corporate actions over which Bunge-Bermuda’s Board of Directors currently has authority. For example, dividends must be approved by shareholders. While we do not believe that(1) complement the differences between Bermuda law and Swiss law relating to our capital management will have an adverse effect on us, we cannot assure you that situations will not arise where such flexibility would have provided substantial benefits to our shareholders.
Bunge-Switzerland may not be able to make distributions or repurchase shares without subjecting you to Swiss withholding tax.
Under current Swiss law, distributions made out of qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration or made in the form of a par value reduction are not subject to Swiss withholding tax. However, there can be no assurances that the Swiss withholding rules will not be changed in the future or that shareholders will approve a distribution out of qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration or a reduction in par value for distributions. Further, over the long term, the amount of par value and qualifying contribution reserves available for Bunge-Switzerland may be limited. If Bunge-Switzerland is unable to make a distribution out of qualifying capital contribution reserves or through a reduction in par value, then any dividends paid by Bunge-Switzerland will generally be subject to a Swiss withholding tax at a rate of 35%. The withholding tax must be withheld from the gross distribution and paid to the Swiss Federal Tax Administration. Dividends, if any, paid on Bunge-Bermuda’s shares are not currently subject to withholding tax in Bermuda. A U.S. holder that qualifies for benefits under the Convention between the United States of America and the Swiss Confederation for the Avoidance of Double Taxation with Respect to Taxes on Income, which we refer to as the “U.S.-Swiss Treaty,” may apply for a refundmembers of the tax withheld in excessBoard and other proposed nominees to further the objective of having a Board that guides the long-term strategy and ongoing business operations of the 15% treaty rate (or forCompany, and (2) reflects a full refund in casediversity of qualified pension funds). Switzerland currently has concluded more than 70 tax treaties withbackground and experience to effectively perform the same treatment regarding the refund of Swiss withholding taxes.
Under current Swiss law, repurchases of shares for the purposes of capital reduction are treated as a partial liquidation subject to 35% Swiss withholding tax on the difference between the par value plus qualifying capital contributions reserves and the repurchase price. Over the long term, the amount of par value and qualifying contribution reserves available for Bunge-Switzerland may be limited. Bunge-Switzerland may follow a share repurchase process for future share repurchases, if any, whereby Swiss institutional investors purchase Bunge-Switzerland shares from you and then sell the shares to Bunge-Switzerland and apply for a refundfunctions of the Swiss withholding tax. However, if Bunge-Switzerland is unable to use this process successfully, Bunge-Switzerland may not be able to repurchase shares for the purposes of capital reduction without subjecting you to Swiss withholding taxes. Please see “Certain Tax Considerations—Swiss Tax Considerations—Consequences to Shareholders of Bunge-Switzerland Subsequent to the Redomestication—Repurchases of Shares.”
Board and its committees. The Redomestication will result in additional costs to us, some of which will be incurred regardless of whether the Redomestication is completed.
The completion of the Redomestication will result infollowing provides an increase in someoverview of our ongoing expenses and require us to incur some new expenses in connection with the Redomestication regardless of whether the Redomestication is completed.
Board refreshment process.
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CAUTIONARY INFORMATION REGARDING FORWARD-LOOOKING STATEMENTS |
This proxy statement and the documents incorporated by reference in this proxy statement contain both historical and forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward looking statements to encourage companies to provide prospective information to investors. This proxy statement and the documents incorporated by reference into this proxy statement include forward looking statements that reflect our current expectations and projections about our future results, performance, prospects and opportunities, including expectations regarding the consummation of the Redomestication, benefits, timing and effects of the Redomestication, offices and operations, share trading, management of our business, taxes, strategic flexibility, legal and regulatory environment, financial results and other statements that are not historical facts, are forward looking statements. Forward looking statements include all statements that are not historical in nature. We have tried to identify these forward looking statements by using words including “may,” “will,” “should,” “could,” “expect,” “anticipate,” “believe,” “plan,” “intend,” “estimate,” “continue” and similar expressions. These forward looking statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, to differ materially from those expressed in, or implied by, these forward looking statements. These factors include the risks, uncertainties, assumptions, trends and other factors discussed under the heading “Risk Factors” and elsewhere in our periodic reports filed with the Securities and Exchange Commission or in the applicable prospectus supplement or other offering material, including:
•risks and uncertainties related to our ability to complete the Redomestication, including our ability to obtain necessary approvals and the risk of changes in tax laws;
•the impacts of the COVID-19 pandemic and other potential pandemic outbreaks;
•the effect of weather conditions and the impact of crop and animal disease on our business;
•the impact of global and regional economic, agricultural, financial and commodities market, political, social and health conditions;
•changes in governmental policies and laws affecting our business, including agricultural and trade policies, financial markets regulation and environmental, tax and biofuels regulation;
•the impact of seasonality;
•the impact of government policies and regulations;
•the outcome of pending regulatory and legal proceedings;
•our ability to complete, integrate and benefit from acquisitions, divestitures, joint ventures and strategic alliances;
•the impact of industry conditions, including fluctuations in supply, demand and prices for agricultural commodities and other raw materials and products that we sell and use in our business, fluctuations in energy and freight costs and competitive developments in our industries;
•the impact on our operations and facilities from the military conflict in Ukraine and the resulting economic and other sanctions imposed on Russia, including the impact on Bunge resulting from a continuation and/or escalation of the conflict and sanctions against Russia;
•the effectiveness of our capital allocation plans, funding needs and financing sources;
•the effectiveness of our risk management strategies;
•operational risks, including industrial accidents, natural disasters and cybersecurity incidents;
•changes in foreign exchange policy or rates;
•the impact of our dependence on third parties;
•our ability to attract and retain executive management and key personnel; and
•other factors affecting our business generally.
In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward looking statements contained in this proxy statement or in any document incorporated by reference herein or therein. Additional risks that we may currently deem immaterial or that are not presently known to us could also cause the forward looking events discussed in this proxy statement or any document incorporated by reference herein or therein not to occur. Except as otherwise required by federal securities laws, we undertake no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events, changed circumstances or any other reason after the date of this proxy statement.
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THE REDOMESTICATION | Corporate Governance and Nominations Committee Oversight | |
| Committee Chair: Sheila Bair, Independent Director | | | | | |
| Identification of Candidates | | Assessment and Interviews | | Nomination and Election | | Onboarding | |
| The Corporate Governance and Nominations Committee reviews candidates identified by an independent search firm, members of the Board or management, and shareholders or other persons, taking into consideration the Board Membership Criteria and Diversity Policy. | | The Corporate Governance and Nominations Committee seeks input from other Board members and senior management to evaluate director nominees and interviews appropriate candidates to confirm their qualifications, skills, interest and availability for Board service. | | Upon a recommendation from the Corporate Governance and Nominations Committee, the Board determines whether to nominate a director candidate and optimal committee placement. | | We conduct a comprehensive onboarding process for new directors, including meetings with management, site visits and a resource library to provide an understanding of our business strategy, opportunities and challenges. | |
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TheDirector Re-elections: Additionally, the Corporate Governance and Nominations Committee annually reviews the tenure, performance, skills and contributions of existing Board of Directors has unanimously approved and recommends that you approve the Redomestication.
The Redomestication involves several steps. First, we have formed Bunge-Switzerland as a direct, wholly-owned subsidiary of Bunge-Bermuda. Bunge-Switzerland, in turn, has formed Bunge-MergerCo, a new Bermuda subsidiary. Following the Bunge-Bermuda shareholders' meeting to be held on [●] and a hearing of the Bermuda Court scheduled for [●], assuming we have obtained the necessary shareholder and court approvals, Bunge-MergerCo will merge with Bunge-Bermuda by way of the Scheme of Arrangement, with Bunge-Bermuda as the surviving company. As a result of the Redomestication, Bunge-MergerCo will cease to exist, and Bunge-Bermuda will become a direct, wholly-owned subsidiary of Bunge-Switzerland. Effective for the date that is one day after the Effective Date, Bunge-Bermuda will make a U.S. tax election to be treated as a disregarded entity for U.S. tax purposes.
After the Redomestication, you will continue to own an interest in a parent company that will continue to conduct the business operations as conducted by Bunge-Bermuda before the Redomestication. The number of shares you will own in Bunge-Switzerland will be the same as the number of shares you owned in Bunge-Bermuda immediately priormembers to the Redomestication, and your relative economic interest in the Bunge Group will remain unchanged.
The completion of the Redomestication will change the governing law that applies to shareholders of our parent companyextent they are candidates for re-election. Directors eligible for re-election abstain from Bermuda law to Swiss law. There are differences between Bermuda law and Swiss law. See “Comparison of Rights of Shareholders” for a summary of some of these differences.
Upon completion of the Redomestication, we will remain subject to the U.S. Securities and Exchange Commission (“SEC”) reporting requirements and the corporate governance requirements of NYSE, and we will continue to report our financial results in U.S. dollars and under U.S. generally accepted accounting principles (“U.S. GAAP”).
We currently expect to complete the Redomestication later this year.
Background and Reasons for the Redomestication
Bunge incorporated in Bermuda in 1995 when the then-separate Bunge group of companies consolidated into a single company. Over the past few years, Bunge has done an extensive review of its business operations and the emerging trends in global tax environment. As part of this review, Bunge performed a substantial analysis of alternative jurisdictions in which it might Redomesticate. Switzerland was determined to be the best jurisdiction to which Redomesticate because it allows Bunge to better align its corporate legal structure with its commercial operations. Switzerland is a jurisdiction that is well suited for global companies and offers a well-developed corporate, legal and regulatory environment. We have had substantial operations in Switzerland for many years.
As part of this review, Bunge has taken into account likely legislative tax changes proposed by the member states of the Organization for Economic Cooperation and Development (or "OECD") and in particular the Pillar 2 Model Rules, aiming at introducing a global minimum corporate tax rate of 15% on financial statement income. The focus of the OECD is to discourage multinational corporations from using low tax or no tax jurisdictions (tax havens) to avoid taxation.
As part of the Redomestication, Bunge will be re-locating its publicly traded parent company to Switzerland, a place from which Bunge has operated for decades and in which we have significant substance. Switzerland is more centrally located within Bunge’s major markets and the home of many global companies. It will locate Bunge in a country with balanced corporate governance requirements, more sophisticated financial and commercial infrastructure as well as a stable and well-developed legal system that accommodates global businesses.
Given the emerging focus on whether companies have substantial operations inBoard discussions regarding their jurisdiction of incorporation, we preliminarily considered six countries in which we do business as potential jurisdictions to which we might redomesticate. We reduced this list to three countries and carefully analyzed them separately and relative to each other based on legal system, governance requirements, acceptability by investors, the ability to report financial results under U.S. GAAP, the effect on our long-term indebtedness, implementation costs and timing.
We ultimately selected Switzerland in this process. Among other things, we determined that it accomplished our main objective of Redomestication to a jurisdiction with a recognized and relatively well-developed and stable legal system in which we had substantial operations. We also determined that Switzerland had well-developed corporate governance requirements, and had a history of commerce, generally reliable judicial processes and was generally accepted by investors.
While other non-Swiss countries also had favorable attributes, those jurisdictions would have subjected us to governance requirements that were substantially different from those applicable to us under U.S. SEC and NYSE requirements as well as prevailing investor attributes.
Additional tax costs may be incurred in light of recent and expected changes in global tax environment. Other considerations that we considered are:
•Swiss law requires shareholder approval of various matters, including the issuance of shares and declaration of dividends, that are not required to be approved by shareholders under Bermuda law or NYSE requirements, which could cause us to miss opportunities. See “Description of Bunge-Switzerland Shares.”
•While we do not expect that this will present a practical issue for the foreseeable future, Switzerland generally imposes 35% Swiss withholding taxes on dividends. See "Questions and answers to the Redomestication".
In the final analysis, we concluded that the positive considerations outweighed the negative considerations and supported selecting Switzerland as the jurisdiction to which to redomesticate.
The Board considered these factors when assessing the Redomestication and determining to submit it to shareholders and concluded that proceeding with the Redomestication to Switzerland was preferable to redomesticating to other jurisdictions or not redomesticating at all at this time. We cannot assure you, however, that the anticipated benefits of the Redomestication will be realized or that we will complete the Redomestication at all. In addition to the potential benefits described above, the Redomestication will expose Bunge-Bermuda and its shareholders to certain risks. Please see the discussion under “Risk Factors.”
The Agreement and Plan of Merger
There are several steps to the Redomestication:
•Bunge-Bermuda has formed Bunge-Switzerland, which, in turn, has formed Bunge-MergerCo;
•following the Bunge-Bermuda shareholders' meeting and a hearing of the Bermuda Court on [●], and assuming we have obtained the necessary shareholder and court approvals, Bunge-MergerCo will merge with Bunge-Bermuda by way of the Scheme of Arrangement, with Bunge-Bermuda surviving as a direct, wholly-owned subsidiary of Bunge-Switzerland;
•all of the issued and outstanding shares of Bunge-Bermuda will be cancelled and converted into the right of holders of Bunge-Bermuda to receive Bunge-Switzerland shares;
•these resulting shares of Bunge-MergerCo will be converted into one share of Bunge-Bermuda for issuance, allotment and contribution to the capital contribution reserves of Bunge-Switzerland in exchange for the delivery of one share of Bunge-Switzerland for each issued and outstanding share of Bunge-Bermuda as of the Effective Date, plus one Bunge-Switzerland share for each share of Bunge-Bermuda held in treasury (collectively the “Treasury Shares”) as of the Effective Date for future use to satisfy Bunge-Switzerland’s obligations to deliver shares in connection with awards granted under our equity incentive plans and for such other purposes as Bunge-Switzerland's Board of Directors may determine;
•Bunge-Switzerland will assume, with effect as of the Effective Date, Bunge-Bermuda’s existing obligation to deliver shares under such equity incentive plans;
•Bunge-Bermuda will deliver to its shareholders (through its transfer agent) one Bunge-Switzerland share for each Bunge-Bermuda share held by them. Bunge-Switzerland has, prior to the effectiveness of the Redomestication, issued such number of shares to Bunge-Bermuda at an issue price equal to the aggregate par value of such shares. In connection with the completion of the Redomestication, Bunge-Bermuda will further contribute the Treasury Shares to Bunge-Switzerland.
Additional Agreements
Bunge-Switzerland and Bunge-MergerCo will indemnify the executive officers and directors of Bunge-Bermuda and its subsidiaries and will maintain directors’ and officers’ liability insurance for those executive officers and directors for six years after the Effective Date.
Amendment or Termination
The Agreement and Plan of Merger may be amended, modified or supplemented at any time before or after its adoption by the shareholders of Bunge-Bermuda. However, after adoption, no amendment, modification or supplement may be made or effected that requires further approval by Bunge-Bermuda shareholders without obtaining that approval.
The Board of Directors of Bunge-Bermuda may terminate the Agreement and Plan of Merger and abandon the Redomestication at any time prior to its effectiveness without obtaining the approval of Bunge-Bermuda shareholders.
Conditions to Consummation of the Redomestication
The Redomestication will not be completed unless, among other things, the following conditions are satisfied or, if allowed by law, waived:
•the Redomestication is approved by the requisite vote of shareholders of Bunge-Bermuda;
•none of the parties to the Agreement and Plan of Merger is subject to any governmental decree, order or injunction that prohibits the consummation of the Redomestication;
•the Bunge-Switzerland registered shares to be issued in the Redomestication and the Articles of Association of Bunge-Switzerland have been registered with the commercial register in [●], Switzerland;
•the requisite court order sanctioning the Redomestication shall have been obtained from the Bermuda Court and filed with the Bermuda Registrar of Companies and shall be effective;
•the Bunge-Switzerland shares to be issued pursuant to the Redomestication are authorized for listing on the New York Stock Exchange, subject to official notice of issuance;
•Bunge receives an opinion from Jones Day, in form and substance reasonably satisfactory to it, confirming, as of the Effective Date , the matters discussed under “Certain Tax Considerations—U.S. Federal Income Tax Considerations”; and
•Bunge receives an opinion from Homburger Ltd, in form and substance reasonably satisfactory to it, confirming, as of the Effective Date, the matters discussed under “Certain Tax Considerations—Swiss Tax Considerations.”
In the event the conditions to the Redomestication are not satisfied, the Scheme of Arrangement may be abandoned or delayed, even after approval by our shareholders and the Bermuda Court. If conditions to the Redomestication are not satisfied or waived on or before 5:00 p.m. (Bermuda time) on the date nine months after the date on which the Scheme of Arrangement becomes effective, or such later date as agreed by Bunge-Bermuda and sanctioned by the Bermuda Court, the Scheme of Arrangement will lapse by its terms. In addition, under Bermuda law, the Scheme of Arrangement may be otherwise delayed or otherwise abandoned if further events occur that cause our Board or Directors to determine that the Redomestication is no longer in the best interest of Bunge or its shareholders.
Bunge-Bermuda is a party to certain credit agreements that require waivers from third-party lenders prior to implementation of the Redomestication. See “—Credit Facilities” for more information.
Court Approval of the Redomestication
Pursuant to Section 99 of the Companies Act 1981 of Bermuda (the “Companies Act”), the Scheme of Arrangement requires the approval of the Bermuda Court. This requires Bunge-Bermuda to file an application for the sanction of the Scheme of Arrangement with the Bermuda Court. Prior to the mailing of this proxy statement, Bunge‑Bermuda made an application to the Bermuda Court for an order convening a special meeting of Bunge-Bermuda voting common shareholders to consider and if thought fit approve the Scheme of Arrangement (the “Convening Order”).
At the special meeting, Bunge-Bermuda shareholders will be asked to approve the Scheme of Arrangement. If the shareholders approve the Scheme of Arrangement, then Bunge-Bermuda will apply to the Bermuda Court for an order sanctioning the Scheme of Arrangement (the “Sanction Hearing”). At the Sanction Hearing, the Bermuda Court may impose such conditions as it deems appropriate in relation to the Scheme of Arrangement but may not impose any material changes without the joint consent of Bunge-Bermuda and Bunge-Switzerland.nomination. In determining whether to exercise its discretionrecommend a director for re-election, the Committee also considers the director’s participation in and approve the Scheme of Arrangement, the Bermuda Court will determine, among other things, whether the Scheme of Arrangement is faircontributions to Bunge-Bermuda’s common shareholders in general. If you are a common shareholder who wishes to appear or be represented and present evidence or arguments at the Sanction Hearing, you may do so. Holders of Bunge-Bermuda common shares at the Record Date who vote either for or against the proposal or who the Bermuda Court is satisfied have a substantial economic interest in the Scheme of Arrangement are entitled to appear before the Bermuda Court, at the time and date set for the hearing of the petition to sanction the Scheme of Arrangement, to voice your objection to the Scheme of Arrangement. Bunge-Bermuda will not object to your appearance or participation at the hearing, on the grounds that you do not have a s substantial economic interest in the Scheme of Arrangement.
Should you wish to appear before the Bermuda Court, Bunge-Bermuda encourages you to adopt one of the below noted procedures:
•appearing in person at the Bermuda Court, having notified Bunge-Bermuda's legal counsel 48 hours in advance of your intention to do so by e-mailing or telephoning [●]. You will in such circumstances be requested to provide an affidavit setting out the evidence upon which you seek to rely at the hearing;
•filing an affidavit with the Bermuda Court at least 48 hours prior to the date of the hearing of the petition to sanction setting out your reasons for objecting. At the same time as filing the affidavit, you should serve a copy of the affidavit on Bunge-Bermuda by leaving same at the office of [●]; or
•instructing counsel to appear on your behalf before the Bermuda Court, such counsel to provide notice of their intention to appear [●] at least 48 hours prior to the sanction hearing and at the same time providing a copy of the evidence upon which counsel shall seek to rely set out in an affidavit.
The Scheme of Arrangement will become effective as soon as a copy of the order of the Bermuda Court sanctioning the Scheme of Arrangement has been delivered to the Registrar of Companies in Bermuda as required by Section 99 of the Companies Act. See “Summary — Conditions to Consummation of the Scheme of Arrangement” for more information on these conditions.
Once the Scheme of Arrangement is effective, the Bermuda Court will have exclusive jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute which arises out of or is connected with the terms of the Scheme of Arrangement or its implementation or out of any action taken or omitted to be taken under the Scheme of Arrangement or in connection with the administration of the Scheme of Arrangement. A shareholder who wishes to enforce any rights under the Scheme of Arrangement after such time should notify Bunge-Bermuda in writing of its intention at least five business days prior to commencing a new proceeding. After the effective time of the Scheme of Arrangement, no shareholder may commence a proceeding against Bunge-Switzerland or Bunge-Bermuda with respect to or arising from the Scheme of Arrangement except to enforce its rights under the Scheme of Arrangement where a party has failed to perform its obligations under the Scheme of Arrangement.
When under any provision of the Scheme of Arrangement after the effective time of the Scheme of Arrangement a matter is to be determined by Bunge-Bermuda, then Bunge-Bermuda will have discretion to interpret those matters under the Scheme of Arrangement in a manner that it considers fair and reasonable, and its decisions will be binding on all concerned.
Bunge-Bermuda may, subject to U.S. securities law constraints, consent to any modification of the Scheme of Arrangement on behalf of the shareholders that the Bermuda Court determines to approve or impose.
Federal Securities Law Consequences; Resale Restrictions
The issuance of Bunge-Switzerland shares to Bunge-Bermuda’s shareholders in connection with the Redomestication will not be registered under the Securities Act of 1933 (the “Securities Act”). Section 3(a)(10) of the Securities Act exempts securities issued in exchange for one or more outstanding securities from the general requirement of registration where the terms and conditions of the issuance and exchange of such securities have been approved by any court of competent jurisdiction, after a hearing upon the fairness of the terms and conditions of the issuance and
exchange at which all persons to whom such securities will be issued have a right to appear and to whom adequate notice of the hearing has been given. In determining whether it is appropriate to convene the shareholder scheme meeting convened pursuant to its directions, the Bermuda Court will consider whether the terms and conditions of the Redomestication are fair. The Bermuda Court has fixed the date for the hearing of the application to approve the Redomestication at [●], in Hamilton, Bermuda. The Bunge-Switzerland shares issued to Bunge-Bermuda shareholders in connection with the Redomestication will be freely transferable, except for restrictions applicable to certain “affiliates” of Bunge-Bermuda under the Securities Act, as follows:
•Persons who were not affiliates of Bunge-Bermuda at the date of the Redomestication and have not been affiliates within 90 days prior to such date will be permitted to sell any Bunge-Switzerland shares received in the Redomestication without regard to Rule 144 under the Securities Act.
•Persons who were affiliates of Bunge-Bermuda at the date of the Redomestication or were affiliates within 90 days prior to such date will be permitted to resell any Bunge-Switzerland shares they receive pursuant to the Redomestication in the manner permitted by Rule 144. In computing the holding period of the Bunge-Switzerland shares for the purposes of Rule 144(d), such persons will be permitted to “tack” the holding period of their Bunge-Bermuda shares held prior to the Effective Date.
Persons who may be deemed to be affiliates of Bunge-Bermuda and Bunge-Switzerland for these purposes generally include individuals or entities that control, are controlled by, or are under common control with, Bunge-Bermuda and Bunge-Switzerland, and would not include shareholders who are not executive officers, directors or significant shareholders of Bunge-Bermuda and Bunge-Switzerland.
The Agreement and Plan of Merger requires Bunge-Bermuda to prepare and deliver to Bunge-Switzerland a list that identifies all persons whom Bunge-Bermuda believes may be deemed to be affiliates prior to the completion of the Redomestication. Bunge-Bermuda is also required, pursuant to the Agreement and Plan of Merger, to use its commercially reasonable best efforts to cause each person whom it identifies on the list as a potential affiliate to deliver, at or prior to the completion of the Redomestication, a written agreement that the affiliate will not sell, pledge, transfer or otherwise dispose of any of the Bunge-Switzerland shares issued to the affiliate pursuant to the Redomestication unless the sale, pledge, transfer or other disposition meets one of the following criteria:
•it is made pursuant to an effective registration statement filed under the Securities Act;
•it is in compliance with Rule 144; or
•in the opinion of counsel, it is otherwise exempt from the registration requirements of the Securities Act.
Bunge-Bermuda has not filed a registration statement with the SEC covering any resales of the Bunge-Switzerland shares to be received by Bunge-Bermuda’s shareholders in the Redomestication.
Effective Date
If the Redomestication is approved by the requisite shareholder vote and by the Bermuda Court, we anticipate that the Redomestication will become effective as soon as practicable following the Sanction Hearing, upon our filing of the court order sanctioning the Redomestication with the Bermuda Registrar of Companies. We currently expect to complete the Redomestication later this year, subject to the conditions noted below.
In the event the conditions to the Redomestication are not satisfied, the Redomestication may be abandoned or delayed, even after approval by our shareholders and the Bermuda Court. In addition, the Redomestication may be abandoned or delayed for any reason by our Board of Directors at any time prior to the Redomestication becoming effective, even though the Redomestication may have been adopted by our shareholders and the Bermuda Court, and all conditions to the Redomestication may have been satisfied.
If conditions to the Redomestication are not satisfied or waived on or before 5:00 p.m. (Bermuda time) on the date nine months after the date on which the Scheme of Arrangement becomes effective, or such later date as agreed by Bunge-Bermuda and sanctioned by the Bermuda Court, the Scheme of Arrangement will lapse by its terms. In addition, under Bermuda law, the Scheme of Arrangement may be otherwise delayed or otherwise abandoned if further events occur that cause our board or directors to determine that the Redomestication is no longer in the best interest of Bunge or its shareholders.
Board of Directors of Bunge-Switzerland
When the Redomestication is completed, the Directors of Bunge-Bermuda immediately prior to the completion of the Redomestication are expected to be the Directors of Bunge-Switzerland. Bunge-Switzerland’s articles of association allow for the same number of Directors as Bunge-Bermuda currently has, and Bunge-Bermuda’s Directors will carry their terms of office over to the Bunge-Switzerland’s Board of Directors.
Required Vote; Board Recommendation
The Redomestication requires the affirmative vote of holders of Bunge-Bermuda common shares representing a majority in number and at least 75% in value of the Bunge-Bermuda common shares present and voting at the meeting, whether in person or by proxy. See “The Meeting—Record Date; Voting Rights; Vote Required for Approval.” Our Board of Directors has unanimously approved the Redomestication and recommends that shareholders vote “FOR” approval of both of the proposals.
Regulatory Matters
We are not aware of any other governmental approvals or actions that are required to complete the Redomestication other than compliance with U.S. federal and state securities laws and Bermuda and Swiss corporate law.
No Appraisal Rights
Under Bermuda law, none of the shareholders of Bunge-Bermuda has any right to an appraisal of the value of their shares or payment for them in connection with the Redomestication.
No Action Required to Exchange Shares
On the Effective Date, your Bunge-Bermuda common shares will be exchanged for Bunge-Switzerland shares without any action on your part. All of Bunge-Bermuda’s common shares are issued in uncertificated book-entry form. All of Bunge-Switzerland’s shares will also be issued in uncertificated book-entry form.
Distribution Policy
Bunge-Bermuda has historically paid and Bunge-Switzerland expects to continue to pay cash distributions to holders of our common shares on a quarterly basis. Any future determination to pay distributions will, subject to the provisions of applicable law, be at the discretion of our Board and will depend upon then existing conditions, including our financial condition, results of operations, contractual and other relevant legal or regulatory restrictions, capital requirements, business prospects and other factors our Board deems relevant. Following the Redomestication, future declaration and payment of Bunge-Switzerland distributions will be subject to shareholder approval.
For a description of restrictions on distributions imposed by Swiss law, see “Description of Bunge-Switzerland Shares—Distributions,” “—Repurchases of Registered Shares” and “Certain Tax Considerations—Swiss Tax Considerations—Consequences to Shareholders of Bunge-Switzerland Subsequent to the Redomestication.”
Equity Incentive Plans
If the Redomestication is completed, Bunge-Switzerland will adopt and assume Bunge-Bermuda’s equity incentive plans and other employee benefit plans and arrangements, and those plans and arrangements will be amended as necessary to give effect to the Redomestication, including to provide (1) that shares of Bunge-Switzerland will be issued, held, available or used to measure benefits as appropriate under the plans and arrangements, in lieu of shares of Bunge-Bermuda, including upon exercise of any options or share appreciation rights issued under those plans and arrangements; and (2) for the appropriate substitution of Bunge-Switzerland for Bunge-Bermuda in those plans and arrangements. Shareholder approval of the Redomestication will also constitute shareholder approval of these amendments and the adoption and assumption of the plans and arrangements by Bunge-Switzerland.
Stock Exchange Listing
Bunge-Bermuda’s common shares are currently listed on the New York Stock Exchange. There is currently no established public trading market for the shares of Bunge-Switzerland. We intend to make application so that, immediately following the Redomestication, the shares of Bunge-Switzerland will be listed on the New York Stock Exchange under the symbol “BG,” the same symbol under which the Bunge-Bermuda common shares are currently listed.
Accounting Treatment of the Redomestication
Under U.S. GAAP, the Redomestication represents a transaction between entities under common control. Assets and liabilities transferred between entities under common control are accounted for at cost. Accordingly, the assets and liabilities of Bunge-Switzerland will be reflected at their carrying amounts in the accounts of Bunge-Bermuda on the Effective Date.
Credit Facilities
Upon the completion of the Redomestication, a “change of control” of Bunge-Bermuda constituting an event of default may be deemed to have occurred under the terms of the bank credit agreements governing the unsecured $1.1 billion 364-day Revolving Credit Agreement, unsecured committed $1.35 billion 5-year Revolving Credit Agreement, unsecured $865 million 5-year Revolving Credit Agreement, unsecured $1.75 billion 3-year Revolving Credit Facility, $750 million term loan facility, $250 million Delayed Draw Term Loan Facility, $250 million Term Loan Facility, ¥30.7 billion Term Loan Facility and $90 million Term Loan Facility and $600 million commercial paper program of wholly-owned subsidiaries of Bunge-Bermuda. These agreements permit acceleration of the borrowings under such facilities upon such an event of default. Bunge-Bermuda also guarantees certain local credit lines and other financial arrangements of its subsidiaries in which consent may be required. We are seeking amendments to these facilities from our lenders to assign Bunge-Bermuda’s obligations as guarantor thereunder to Bunge-Switzerland in connection with the Redomestication, although we may not be able to obtain the creditor consents required to successfully amend any or all of these facilities. In addition, Bunge-Bermuda and certain of its subsidiaries participate in a trade receivable securitization program (the "Program") with a financial institution, as administrative agent, and certain commercial paper conduit purchasers and committed purchasers that provides for funding of up to $1.1 billion against receivables sold into the Program in which we are seeking amendments to assign Bunge-Bermuda’s obligations thereunder to Bunge-Switzerland. The failure to amend some or all of these facilities could have an adverse effect on our ability to complete the Redomestication or on our business, results of operations or financial condition after the completion of the Redomestication. In connection with the Redomestication, Bunge Switzerland will assume the obligations of Bunge Limited as guarantor under each series of outstanding senior notes in accordance with the terms of the applicable indentures. We do not expect to incur significant costs in connection with obtaining these consents or taking these actions.
Effect of the Redomestication on Potential Future Status as a Foreign Private Issuer
Upon completion of the Redomestication, we will remain subject to SEC reporting requirements, the mandates of the Sarbanes-Oxley Act and the corporate governance rules of the New York Stock Exchange, and we will continue to report our financial results in U.S. dollars and under U.S. GAAP.
We do not currently believe that Bunge-Switzerland will qualify as a “foreign private issuer” within the meaning of the rules promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), upon completion of the Redomestication. The definition of a “foreign private issuer” has two parts—one based on a company’s percentage of U.S. resident shareholders and the other on its business contacts with the U.S. An organization incorporated under the laws of a foreign country qualifies as a foreign private issuer if either part of the definition is satisfied. We do not expect to qualify as a foreign private issuer under the shareholder test because we currently expect that more than 50% of Bunge-Switzerland’s outstanding voting securities will continue to be held by U.S. residents after the completion of the Redomestication. However, under the business contacts test, if it were the case after the Redomestication that (1) more than 50% of Bunge-Switzerland’s assets were located outside the United States, (2) Bunge-Switzerland’s business was not administered principally in the U.S. and (3) a majority of Bunge-Switzerland’s executive officers and directors were neither U.S. citizens nor U.S. residents, then Bunge-Switzerland would qualify as a foreign private issuer. We do not expect that Bunge-Switzerland will meet the requirements of clause (3) of this test upon the completion of the Redomestication, as we believe a majority of Bunge-Switzerland’s executive officers and directors will continue to be U.S. citizens or U.S. residents. However, Bunge-Switzerland may satisfy this element of the test sometime in the future and, as a result, qualify for status as a foreign private issuer at such later date. If and when that occurs, Bunge-Switzerland would be exempt from certain requirements applicable to U.S. public companies, including:
•the rules requiring the filing of Quarterly Reports on Form 10-Q and Current Reports on Form 8-K with the SEC,
•the SEC’s rules regulating proxy solicitations,
•the provisions of Regulation FD,
•the filing of reports of beneficial ownership under Section 16 of the Exchange Act (although beneficial ownership reports may be required under Section 13 of the Exchange Act), and
•“short-swing” trading liability imposed on insiders who purchase and sell securities within a six-month period.
In addition, Bunge-Switzerland would then be allowed to:
•file annual reports within six months after the end of a fiscal year,
•include more limited compensation disclosure in its filings with the SEC,
•apply accounting principles other than U.S. GAAP to its financial statements, although reconciliation to U.S. GAAP would be required if International Financial Reporting Standards (“IFRS”) is not used, and
•choose which reporting currency to use in presenting its financial statements.
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CERTAIN TAX CONSIDERATIONS |
The information presented under the caption “—U.S. Federal Income Tax Considerations” below is a discussion of the certain U.S. federal income tax consequences (1) to U.S. holders and non-U.S. holders (as defined below) of the Redomestication, and of owning and disposing of Bunge-Switzerland shares received in the Redomestication; and (2) to Bunge-Bermuda, Bunge-Switzerland and Bunge-MergerCo of the Redomestication. The information presented under the caption “—Swiss Tax Considerations” is a discussion of the certain Swiss tax consequences (1) to shareholders resident for tax purposes in a country other than Switzerland of the Redomestication and of the ownership and disposition of the Bunge-Switzerland shares and (2) to Bunge-Switzerland of the Redomestication and subsequent operations. The information presented under the caption “—Bermuda Tax Considerations” is a discussion of the material Bermuda tax consequences of the Redomestication.
You should consult your own tax advisor regarding the applicable tax consequences to you of the Redomestication and of ownership and disposition of the Bunge-Switzerland shares under the laws of the United States (federal, state and local), Switzerland (federal, cantonal and communal), Bermuda and any other applicable foreign jurisdiction.
U.S. Federal Income Tax Considerations
Scope of Discussion
This discussion does not generally address any aspects of U.S. taxation other than U.S. federal income taxation, is not a complete analysis or description of all of the possible tax consequences of the Redomestication or of owning and disposing of Bunge-Switzerland shares and does not address all tax considerations that may be relevant to you, such as U.S. federal estate and gift tax laws, or state, local or non-U.S. tax laws. Special rules that are not discussed in the general descriptions below may also apply to you, such as the accounting rules of section 451(b) of the Internal Revenue Code 1986, as amended, which we refer to as the “U.S. Code.”. In particular, this discussion deals only with holders that hold their Bunge-Bermuda shares and will hold their Bunge-Switzerland shares as capital assets and does not address the tax treatment of special classes of holders, such as:
•a holder of Bunge-Bermuda shares who, at any time within the five-year period ending on the date of the Redomestication, has actually or constructively owned 10% or more of the total combined voting power of all classes of stock entitled to vote of Bunge-Bermuda or who, immediately before the Redomestication, actually or constructively owns at least 5% of either the total voting power or the total value of the stock of Bunge-Bermuda,
•a holder of Bunge-Switzerland shares who, immediately after the Redomestication, actually and constructively owns at least 5% of either the total voting power or the total value of the stock of Bunge-Switzerland or who, at any time after the Redomestication, actually or constructively owns 10% or more of the total combined voting power of all classes of stock entitled to vote of Bunge-Switzerland,
•a bank or other financial institution,
•a tax-exempt entity,
•an insurance company,
•a person holding shares as part of a “straddle,” “hedge,” “integrated transaction,” or “conversion transaction,”
•a partnership or other-through entity or a person holding shares through such entity,
•a U.S. expatriate,
•a person who is liable for alternative minimum tax,
•a broker-dealer or trader in securities or currencies,
•a U.S. holder whose “functional currency” is not the U.S. dollar,
•a regulated investment company,
•a real estate investment trust,
•a trader in securities who has elected the mark-to-market method of accounting for its securities,
•a holder who received the Bunge-Bermuda shares through the exercise of employee stock options or otherwise as compensation or through a tax qualified retirement plan, or
•a non-corporate holder of Bunge-Switzerland shares who, because of limitations under the U.S. securities laws or other legal limitations, is not free to dispose of those shares without restriction.
This discussion is based on the laws of the United States, including the U.S. Code, its legislative history, existing and proposed Treasury regulations promulgated thereunder, judicial decisions, published rulings and administrative pronouncements, each as in effect on the date of this proxy statement. These laws may change, possibly with retroactive effect. In addition, the application and interpretation of certain aspects of the passive foreign investment company rules, referred to below, require the issuance of regulations which in many instances have not been promulgated and which may have retroactive effect. There can be no assurance that any of these regulations will be enacted or promulgated, and if so, when they will take effect or the effect they may have on this discussion. There can be no assurance that the United States Internal Revenue Service (“IRS”) will not disagree with or will not successfully challenge any of the conclusions reached and described in this discussion. No ruling has been or will be sought from the IRS with respect to the position and issues discussed herein.
For purposes of this discussion, a “U.S. holder” is any beneficial owner of Bunge-Bermuda shares, or, after the completion of the Redomestication, Bunge-Switzerland shares, that for U.S. federal income tax purposes is:
•an individual citizen or resident alien of the United States,
•a corporation (or other entity taxable as a corporation) organized under the laws of the United States or any state thereof including the District of Columbia,
•an estate, the income of which is subject to U.S. federal income taxation regardless of its source, or
•a trust if (1) it validly elects to be treated as a United States person for U.S. federal income tax purposes or (2)(a) its administration is subject to the primary supervision of a court within the United States and (b) one or more United States persons have the authority to control all of its substantial decisions.
A “non-U.S. holder” of Bunge-Bermuda shares, or, after the completion of the Redomestication, Bunge-Switzerland shares is a holder, other than an entity or arrangement treated as a partnership for U.S. federal income tax purposes, that is not a U.S. holder. For purposes of this summary, “holder” or “shareholder” means either a U.S. holder or a non-U.S. holder or both, as the context may require.
If a partnership (including any entity or arrangement treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of Bunge-Bermuda shares or Bunge-Switzerland shares, the tax treatment of a partner in that partnership will generally depend on the status of the partner and the activities of the partnership. Holders of Bunge-Bermuda shares or Bunge-Switzerland shares that are partnerships and partners in these partnerships are urged to consult their tax advisers regardingBoard, the U.S. federal income tax consequences to themresults of the Redomesticationmost recent Board evaluation and meeting attendance. The Board does not believe that directors should expect to be re-nominated annually.
Membership on other Boards: Under the Corporate Governance Principles, directors must inform the Chair of the Board and the ownership and dispositionChair of the Bunge-Switzerland shares.Corporate Governance and Nominations Committee in advance of accepting an invitation to serve on another public company board. In addition, no director may sit on the board, or beneficially own more than 1% of the outstanding equity securities (other than through mutual funds or similar non-discretionary, undirected arrangements), of any of our competitors in our principal lines of business.
InBoard Membership Criteria and Diversity Policy: For all directors, we require an independent mindset, high personal and professional ethics, integrity, sound business judgment, the discussion that follows, except as otherwise indicated, itability and willingness to commit sufficient time to the Board and to promoting the long-term interests of the Company's shareholders. Our Board considers many factors in evaluating the suitability of individual director candidates, including, but not limited to: a general understanding of global business, finance and other disciplines relevant to the success of a large, publicly traded company; understanding of our business and technology; education, professional background and personal accomplishments; and geographic, gender, age, and racial and ethnic diversity. The Board is assumed, as Bunge believescommitted to be the case, that Bunge-Bermuda has not beenactively seeking highly qualified women and will not be a passive foreign investment company before the Redomestication and that Bunge-Switzerland will not be a passive foreign investment company after the Redomestication. See “—Passive Foreign Investment Company Considerations.” It is also assumed, as Bunge expectsindividuals from historically underrepresented groups to be the case, that Bunge-Switzerland will continue to be a foreign corporationinclude in the future. See “—Effectcandidate pool from which Board nominees are selected.
Independent Search Firm: A professional search firm recently assisted the Corporate Governance and Nominations Committee in connection with its recommendation of Messrs. Kobori and Simril, who were both appointed to the Redomestication on Potential Future Status asBoard in 2021, Ms. Aleixo Lustosa, who was appointed in 2022 and Mr. Fransen and Ms. McGurk, who are being nominated for election to the Board at the Annual General Meeting. When using a Foreign Private Issuer.”
It is intended thatprofessional search firm, the Redomestication, together with an election by Bunge-Bermuda to be disregarded for U.S. federal tax purposes effective for the date that is one day after the Effective Date, qualify as a "reorganization" under Section 368(a) of the U.S. Code. The remainder of the discussion assumes that the Redomestication qualifies as "reorganization" within the meaning of Section 368(a) of the U.S. Code.
25Bunge | 2023 Proxy Statement 16
Bunge
ConsequencesCorporate Governance and Nominations Committee directs the firm to include in each director search a diverse slate of the Redomestication: Bunge-Bermuda, Bunge-Switzerland and Bunge-MergerCo will not, as a result of the Redomestication, recognize gain or loss for U.S. federal income tax purposes.
U.S. Holders
Consequences of the Redomestication: U.S. holders will generally recognize no gain or loss upon the exchange of Bunge-Bermuda shares for Bunge-Switzerland shares in the Redomestication. A U.S. holder’s tax basis of the Bunge-Switzerland shares received in the Redomestication generally should equal the U.S. holder’s tax basis in its shares of Bunge-Bermuda exchanged, and the U.S. holder’s holding period of the Bunge-Switzerland shares will include the period during which the U.S. holder held its shares of Bunge-Bermuda shares exchanged in the Redomestication. Shareholders who hold their Bunge-Bermuda shares with differing bases or holding periods are urged to consult their tax advisors with regard to identifying the bases and holding periods of the particular Bunge-Switzerland shares received in the Redomestication.
Taxation of Distributionsqualified candidates based on the Bunge-Switzerland Shares: The gross amountBoard Membership Criteria and Diversity Policy outlined in our Corporate Governance Principles. After consulting with the Corporate Governance and Nominations Committee, the firm further screens and interviews candidates to assess their qualifications, interest and any potential conflicts of a distribution paid with respect to Bunge-Switzerland shares, including the full amount of Swiss withholding tax on such amount, if any, will be a dividend for U.S. federal income tax purposesinterest, and provides its results to the extent of Bunge-Switzerland’s current or accumulated earnings and profits (as determined for U.S. tax purposes). With respect to non-corporate U.S. holders, provided certain requirements are met (including certain holding period requirements), dividends received from a “qualified foreign corporation” will be subject to U.S. federal income tax at the reduced rate accorded to long-term capital gains. As long as the Bunge-Switzerland shares are listed on the New York Stock Exchange or certain other exchanges and/or Bunge-Switzerland qualifies for benefits under the income tax treaty between the United States and Switzerland, Bunge-Switzerland will be treated as a “qualified foreign corporation” for this purpose. This reduced rate will not be available in all situations, and U.S. holders should consult their own tax advisors regarding the application of the relevant rules to their particular circumstances. Dividends received by a corporate shareholder generally will not be eligible for the dividends received deductionCommittee, which is generally allowed to U.S. corporate shareholders on dividends received from a domestic corporation.
To the extent that a distribution exceeds Bunge-Switzerland’s current or accumulated earnings and profits (as determined for U.S. tax purposes), it will be treated as a nontaxable return of capital to the extent of the taxpayer’s basis in the shares, and thereafter generally should be treated as a capital gain. Special rules not here described may apply to shareholders who do not have a uniform basis and holding period in all of their Bunge-Switzerland shares, as to which shareholders should consult their own tax advisors.
As discussed further under "-Swiss Tax Considerations-Exemption from Swiss Withholding Tax-Distribution to Shareholders", we do not expect Swiss withholding tax to be applicable on distributions paid to Bunge-Switzerland shareholders from Bunge-Switzerland for the foreseeable future. In the even Swiss withholding taxes apply to such distributions, subject to complex limitations, such Swiss withholding tax generally will be treated for U.S. tax purposes as a foreign tax that may be claimed as a foreign tax credit against the U.S. federal income tax liability of a U.S. holder. Distributions paid to U.S. holders with respect to Bunge-Switzerland shares should generally be treated as foreign source income, which may be relevant in calculating the foreign tax credit limitation. The limitation on foreign taxes eligible for a credit is calculated separately with respect to specific classes of income. Dividends paid by Bunge-Switzerland generally will constitute “passive category income,” or in the case of certain U.S. holders, “general category income” or “foreign branch” income. Moreover, Treasury regulations that apply to taxable years beginning on or after December 28, 2021 may in some circumstances prohibit a U.S. holder from claiming a foreign tax credit unless the taxes are creditable under an applicable treaty and the holder is eligible for benefits under the treaty and electsuses its application. The rules relating to the determination of the foreign tax credit are complex, and shareholders should consult their tax advisorsindependent judgment to determine whether to recommend to the Board a candidate for nomination..
Each of the nominees for election at the Annual General Meeting was recommended for nomination to the Board by the Corporate Governance and Nominations Committee.
Board Succession and Tenure
Director Succession: The Board actively reviews and refreshes its membership. In furtherance of this objective, the Corporate Governance and Nominations Committee assists the Board in developing succession planning guided by the long-term strategy and ongoing business operations of the Company. As part of succession planning, the Corporate Governance and Nominations Committee annually, and on an as needed basis, reviews the composition of the Board against the skills criteria applicable to what extent a credit wouldpotential candidates for nomination to the Board, as well as existing directors, and makes director nomination recommendations to the Board.
Director Tenure: No director that has reached the age of 72 can be available. In lieunominated for re-election or re-appointment to the Board; however, the Board does not impose director tenure limits as the Board believes that imposing limits on director tenure could arbitrarily deprive it of claiming a credit, U.S. holders may claim a deductionthe valuable contributions of foreign taxes paidits most experienced members. Accordingly, length of Board service is one of the factors considered by the Corporate Governance and Nominations Committee in making director nomination recommendations to the Board. Additionally, each director must be re-nominated by the Board on an annual basis, which provides the Board with the opportunity to consider the optimal mix of characteristics, skills, qualifications and experience in the taxable year. Unlike a tax credit, a deduction generally does not reduce U.S. tax on a dollar-for-dollar basis. In the event a 35% Swiss withholding tax applies to a distribution by Bunge-Switzerland, a U.S. holder that qualifies for benefits under the Convention between the United States of America and the Swiss Confederation for the Avoidance of Double Taxation with Respect to Taxes on Income, which we refer to as the “U.S.-Swiss Treaty,” may apply for a refundevaluation of the tax withheld in excessBoard members each year.
Board Refreshment: Over the course of the 15% treaty rate (orlast five years, 11 directors have either left the Board or decided not to stand for re-election. As a full refundresult, the average tenure of our director nominees is less than three years, with the longest tenured nominee having served for nine years. This significant Board refreshment process has resulted in case of qualified pension funds).
Dispositions of Bunge-Switzerland Shares: U.S. holders of Bunge-Switzerland shares generally should recognize capital gain or loss for U.S. federal income tax purposesan increase in the depth, qualifications and diversity represented on the sale, exchange or other disposition of Bunge-Switzerland sharesBoard.
Shareholder Recommendations and Director Nominations
The Corporate Governance and Nominations Committee will evaluate candidates recommended by shareholders in the same manner as on the sale, exchange orcandidates recommended by other disposition of any other shares held as capital assets (including shares of Bunge-Bermuda stock sold, exchange or otherwise disposed of before the Redomestication). Any gain or loss generally will be long-term capital gain or loss if the U.S. holder’s holding period for the shares disposed of exceeds one year. Long-term capital gains recognized by non-corporate U.S. holders should be eligible to be taxed at the reduced rate for capital gains. There are limitations on the deductibility of capital losses.
Medicare Tax on Net Investment Income: U.S. holders that are individuals, estates and certain trusts generally will be subject to an additional 3.8% Medicare contribution tax on their “net investment income” (which includes dividend income and capital gain on the sale or other taxable disposition of the shares). U.S. holders should consult their tax advisors regarding the possible effect of this legislation on their ownership and disposition of their shares.
Passive Foreign Investment Company Considerations: The treatment of U.S. holders of Bunge-Switzerland shares in some cases could be materially different from that described above if, at any relevant time, Bunge-Bermuda or Bunge-Switzerland were a passive foreign investment company, which we will refer to as a "PFIC". For U.S. tax purposes, a foreign corporation, such as Bunge-Bermuda or Bunge-Switzerland, will be classified as a PFIC for any taxable year if either (1) 75% or more of its gross income is passive income (as defined for U.S. tax purposes) or (2) the average percentage of its assets which produce passive income or which are held for the production of passive income is at least 50%. For purposes of applying the tests in the preceding sentence, the foreign corporation is deemed to own its proportionate share of the assets of and to receive directly its proportionate share of the income of any other corporation of which the foreign corporation owns, directly or indirectly, at least 25% by value of the stock.
Classification of a foreign corporation as a PFIC can have various adverse consequences to shareholders of the corporation who are “United States persons,” as defined in the U.S. Code. These include taxation of gain on a sale or other disposition of the shares of the corporation at the maximum ordinary income rates and imposition of an interest charge on gain or on distributions with respect to the shares.
Bunge believes that Bunge-Bermuda has not been a PFIC in any prior taxable year and does not expect Bunge-Bermuda to be a PFIC in the taxable year in which the Redomestication will occur.
persons. In addition, Bunge does not expect Bunge-Switzerland to be or become a PFIC following the Redomestication. However, the tests for determining PFIC status are applied annually, and it is difficult to accurately predict future income and assets relevant to this determination. Accordingly, Bunge cannot assure U.S. holders that Bunge-Switzerland will not become a PFIC.
If Bunge-Switzerland should determine in the future that it is a PFIC, it will endeavor to so notify U.S. holders of Bunge-Switzerland shares, although there can be no assurance that it will be able to do so in a timely and complete manner. U.S. holders of Bunge-Switzerland shares should consult their own tax advisors about the PFIC rules, including the availability of certain elections, which may mitigate certain adverse tax consequences of owning shares in a PFIC.
Non-U.S. Holders
Consequences of the Redomestication and Subsequent Disposition of the Bunge-Switzerland Shares: In general, a non-U.S. holder of Bunge-Bermuda shares will not in any case be subject to U.S. federal income or withholding tax on any gain with respect to the Redomestication and should not be subject to U.S. federal income or withholding tax on any gain recognized on a subsequent disposition of the Bunge-Switzerland shares, unless: (1) such gain is effectively connected with the conduct by the holder of a trade or business within the United States and, if a tax treaty applies, is attributable to a permanent establishment or fixed place of business maintained by such holder in the United States, (2) in the case of capital gain of a holder who is an individual, such holder is present in the United States for 183 days or more during the taxable year in which the capital gain is recognized and certain other conditions are met, or (3) such holder is subject to backup withholding (as described below).
Taxation of Distributions on the Bunge-Switzerland Shares: A non-U.S. holder generally will not be subject to U.S. federal income tax on distributions received on its Bunge-Switzerland shares, unless the distributions are effectively connected with the holder’s conduct of a trade or business in the United States and, if a tax treaty applies, the distributions are attributable to a permanent establishment or fixed place of business maintained by the holder in the United States or such holder is subject to backup withholding (as described below).
Except to the extent otherwise provided under an applicable tax treaty, a non-U.S. holder generally will be taxed in the same manner as a U.S. holder on distributions paid and gains recognized that are effectively connected with the holder’s conduct of a trade or business in the United States. Effectively connected distributions received and gains recognized by a corporate non-U.S. holder may also, under certain circumstances, be subject to an additional “branch profits tax” at a 30% rate (or, if applicable, a lower treaty rate), subject to certain adjustments.
Information Reporting and Backup Withholding
Distribution payments with respect to shares of Bunge-Switzerland and proceeds from the disposition of shares of Bunge-Switzerland may be subject to information reporting and to backup withholding (currently at a 24% rate). Backup withholding generally will apply to a U.S. holder if:
•the U.S. holder fails to furnish its Taxpayer Identification Number (“TIN”) (which, for an individual, is his or her Social Security Number) to the payor in the manner required;
•the U.S. holder furnishes an incorrect TIN and the payor is so notified by the IRS;
•the payor is notified by the IRS that the U.S. holder has failed to properly report payments of interest or dividends; or
•under certain circumstances, the U.S. holder fails to certify, under penalties of perjury, that such holder is a U.S. person, has furnished a correct TIN and has not been notified by the IRS that such holder is subject to backup withholding for failure to report interest or dividend payments.
Backup withholding and information reporting do not apply with respect to payments made to certain exempt recipients. U.S. holders should consult their tax advisors regarding their qualification for exemption from backup withholding and information reporting, and the procedure for obtaining such an exemption if available.
A non-U.S. holder may be required to provide a taxpayer identification number, certify the holder’s foreign status, or otherwise establish an exemption to not be subject to backup withholding tax on distributions and disposition proceeds with respect to shares of Bunge-Switzerland. Non-U.S. holders of Bunge-Switzerland shares should consult their tax advisers regarding the application of information reporting and backup withholding in their particular situations, the availability of exemptions, and the procedure for obtaining such an exemption, if available.
Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a credit against the holder’s U.S. federal income tax liability and may entitle such person to a refund, provided that certain required information is timely furnished to the IRS.
Swiss Tax Considerations
Scope of Discussion
This discussion does not generally address any aspects of Swiss taxation other than federal, cantonal and communal income taxation, Swiss withholding taxation, and Swiss stamp duties. This discussion is not a complete analysis or listing of all of the possible tax consequences of the Redomestication or of holding and disposing of Bunge-Switzerland shares and does not address all tax considerations that may be relevant to you. Special rules that are not discussed in the general descriptions below may also apply to you.
This discussion is based on the laws of the Confederation of Switzerland, including the Direct Federal Tax Act of 1990, the Federal Harmonization of Cantonal and Communal Direct Taxes Act of 1990, The Federal Withholding Tax Act of 1965, the Federal Stamp Tax Act of 1973, as amended, which we refer to as the “Swiss tax law,” existing and proposed regulations promulgated thereunder, published judicial decisions and administrative pronouncements, each as in effect on the date of this proxy statement or with a known future effective date. These laws may change, possibly with retroactive effect.
For purposes of this discussion, a “Swiss holder” is any beneficial owner of Bunge-Bermuda shares, or, after the completion of the Redomestication, Bunge-Switzerland shares, that for Swiss direct tax purposes is:
•an individual resident of Switzerland or otherwise subject to Swiss taxation under article 3, 4 or 5 of the Direct Federal Tax Act of 1990, as amended, or article 3 or 4 of the Federal Harmonization of Cantonal and Communal Direct Taxes Act of 1990, as amended; or
•a corporation or other entity taxable as a corporation organized under the laws of the Switzerland or otherwise subject to Swiss taxation under article 50 or 51 of the Direct Federal Tax Act of 1990, as amended, or article 20 or 21 of the Federal Harmonization of Cantonal and Communal Direct Taxes Act of 1990, as amended.
A “non-Swiss holder” of Bunge-Bermuda shares, or, after the completion of the Redomestication, Bunge-Switzerland shares, is a holder that is not a Swiss holder. For purposes of this summary, “holder” or “shareholder” means either a Swiss holder or a non-Swiss holder or both, as the context may require.
Consequences of the Redomestication
Shareholder Tax Consequences
No Swiss tax is due for non-Swiss holders upon the exchange of Bunge-Bermuda shares for Bunge-Switzerland shares in the Redomestication.
If Swiss holders are beneficial owners of Bunge-Bermuda shares or Bunge-Switzerland shares, they are urged to consult their tax advisers regarding the Swiss tax consequences to them of the Redomestication.
Swiss Corporate Tax Consequences
Under Swiss tax law as it applies to corporations, the Redomestication is considered to be a tax neutral restructuring for Bunge-Bermuda, Bunge-Switzerland and Bunge-MergerCo. Therefore, no Swiss corporate income taxes will be due with respect to these companies as a result of the Redomestication. As a tax neutral restructuring, the Redomestication is also exempt from Swiss withholding tax and Swiss stamp duties.
Taxation of Bunge-Switzerland Subsequent to the Redomestication
Corporate Income Tax
A Swiss resident company is subject to corporate income tax at federal, cantonal and communal levels on its worldwide income. However, qualifying net dividend income and net capital gains on the sale of qualifying investments in subsidiaries are effectively exempt from federal, cantonal and communal corporate income tax. Consequently, Bunge-Switzerland expects dividends from its subsidiaries and capital gains from sales of investments in its subsidiaries to be exempt from Swiss corporate income tax.
Stamp duty – Swiss Issuance Stamp Tax
Swiss issuance stamp tax is a federal tax levied on the issuance of shares and increases in or contributions to the equity of Swiss corporations. The applicable tax rate is 1% of the contribution value of the assets contributed to equity. Exemptions are available in tax neutral restructuring transactions. As a result, any future issuance of shares by Bunge-Switzerland or any other increase in its equity may be subject to the issuance stamp tax unless the equity is increased in the context of a merger or other qualifying restructuring transaction.
Stamp duty – Swiss Transfer Stamp Tax
The transfer of taxable Swiss and foreign securities (e.g., shares) in which a Swiss bank or other Swiss securities dealers (as defined in the Swiss Federal Stamp Tax Act) participate as contracting parties or as intermediaries is typically subject to Swiss transfer tax at the rate of 0.15% (for securities issued by a resident of Switzerland) and 0.3% (for securities issued by a resident of a foreign country). However, the transfer of taxable securities within qualifying restructuring transactions is exempt from transfer stamp tax.
Swiss Withholding Tax on Certain Interest Payments
A federal withholding tax is levied on the interest payments of certain debt instruments. In such case, the rate would amount to 35% of the gross interest payment to the debtholders. No Swiss withholding tax would be due on interest payments on debt instruments issued by non-Swiss subsidiaries of Bunge-Switzerland, provided that Bunge-Switzerland does not guarantee the debt instruments, or if such a guarantee is provided, the proceeds from the issuance by the non-Swiss subsidiary are not used for financing activities in Switzerland in an amount exceeding the total equity of all non-Swiss subsidiaries of the Bunge Group. Any such withholding tax may be fully or partially refundable to qualified debtholders either based on Swiss domestic tax law or based on existing double taxation treaties. Although, as described in “The Redomestication—Guarantees,” Bunge-Switzerland intends to guarantee certain debt of its subsidiary Bunge-Bermuda, none of the proceeds has been or is expected to be used for financing activities in Switzerland. Consequently, no Swiss withholding tax should be due with respect to such obligations. In the event of the imposition of any such withholding tax, Bunge-Bermuda would be required under some of its debt obligations to gross up the interest payments to cover the tax.
Consequences to Shareholders of Bunge-Switzerland Subsequent to the Redomestication
The tax consequences discussed below are not a complete analysis or description of all the possible tax consequences that may be relevant to you. You should consult your own tax advisor in respect of the tax consequences related to receipt, ownership, purchase or sale or other disposition of Bunge-Switzerland shares and the procedures for claiming a refund of withholding tax.
Swiss Income Tax on Dividends and Similar Distributions
A non-Swiss holder will not be subject to Swiss income taxes on dividend income and similar distributions in respect of Bunge-Switzerland shares, unless the shares are attributable to a permanent establishment or a fixed place of business maintained in Switzerland by such non-Swiss holder. However, dividends and similar distributions are subject to Swiss withholding tax. See “—Swiss Withholding Tax—Distributions to Shareholders.”
Swiss Wealth Tax
A non-Swiss holder will not be subject to Swiss wealth taxes unless the holder’s Bunge-Switzerland shares are attributable to a permanent establishment or a fixed place of business maintained in Switzerland by such non-Swiss holder.
Swiss Capital Gains Tax upon Disposal of Bunge-Switzerland Shares
A non-Swiss holder will not be subject to Swiss income taxes for capital gains unless the holder’s shares are attributable to a permanent establishment or a fixed place of business maintained in Switzerland by such non-Swiss holder. In such case, the non-Swiss holder is required to recognize capital gains or losses on the sale of such shares, which will be subject to cantonal, communal and federal income tax.
Swiss Withholding Tax—Distributions to Shareholders
A Swiss withholding tax of 35% is due on dividends and similar distributions to Bunge-Switzerland shareholders from Bunge-Switzerland out of available earnings or other non-qualifying reserves for withholding tax purposes, regardless of the place of residency of the shareholder (subject to the exceptions discussed under “—Exemption from Swiss Withholding Tax—Distributions to Shareholders” below). Bunge-Switzerland will be required to withhold at such rate and remit on a net basis any payments made to a holder of Bunge-Switzerland shares and pay such withheld amounts to the Swiss Federal Tax Administration. Please see “—Refund of Swiss Withholding Tax on Dividends and Other Distributions.”
Exemption from Swiss Withholding Tax—Distributions to Shareholders
Distributions to shareholders in relation to a reduction of par value and distributions to shareholders out of qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration are exempt from the Swiss withholding tax. Bunge-Switzerland expects to pay distributions out of qualifying capital contribution reserves recognized by the Swiss Federal Tax Administration for the foreseeable future, and as a result, any such distributions to shareholders will be exempt from the Swiss withholding tax. Upon completion of the Redomestication, we expect Bunge-Switzerland to have a par value of $[0.01] per share and qualifying capital contribution reserves per share for Swiss statutory reporting purposes, such that the combination of the two should approximate the market capitalization value of Bunge-Bermuda immediately prior to the completion of the Redomestication.
Repurchases of Shares
Repurchases of shares for the purposes of capital reduction are treated as a partial liquidation subject to the 35% Swiss withholding tax. However, for shares repurchased for capital reduction, the portion of the repurchase price attributable to the par value and to the qualifying contribution reserves recognized by the Swiss Federal Tax Administration of the shares repurchased will not be subject to the Swiss withholding tax. Bunge-Switzerland would be required to withhold at such rate the tax from the difference between the repurchase price and the related amount of par value and qualifying contribution reserves. Bunge-Switzerland would be required to remit on a net basis the purchase price with the Swiss withholding tax deducted to a holder of Bunge-Switzerland shares and pay the withholding tax to the Swiss Federal Tax Administration.
With respect to the refund of Swiss withholding tax from the repurchase of shares, see “—Refund of Swiss Withholding Tax on Dividends and Other Distributions” below.
In many instances, Swiss companies listed on the SIX Swiss Exchange carry out share repurchase programs through a “second trading line” on the SIX Swiss Exchange. Swiss institutional investors typically purchase shares from shareholders on the open market and then sell the shares on the second trading line back to the company. The Swiss institutional investors are generally able to receive a full refund of the withholding tax. Due to, among other things, the time delay between the sale to the company and the institutional investors’ receipt of the refund, the price companies pay to repurchase their shares has historically been slightly higher (but less than 1.0%) than the price of such companies’ shares in ordinary trading on the SIX Swiss Exchange first trading line.
We do not expect to be able to use the SIX Swiss Exchange second trading line process to repurchase our shares because we do not intend to list our shares on the SIX Swiss Exchange. We do, however, intend to follow an alternative process whereby we expect to be able to repurchase our shares in a manner that should allow Swiss institutional market participants selling the shares to us to receive a refund of the Swiss withholding tax and, therefore, accomplish the same purpose as share repurchases on the second trading line at substantially the same cost to us and such market participants as share repurchases on a second trading line.
The repurchase of shares for purposes other than capital reduction, such as to retain as treasury shares for use in connection with equity incentive plans, convertible debt or other instruments within certain periods, will generally not be subject to Swiss withholding tax. However, see “Comparison of Rights of Shareholders” for a discussion on the limitations on the amount of repurchased shares that can be held as treasury shares.
Refund of Swiss Withholding Tax on Dividends and Other Distributions
Swiss Holders: A Swiss tax resident, corporate or individual, can recover the withholding tax in full if such resident is the beneficial owner of the Bunge-Switzerland shares at the time the dividend or other distribution becomes due and provided that such resident reports the gross distribution received on such resident’s income tax return, or in the case of an entity, includes the taxable income in such resident’s income statement, in accordance with statutory law requirements.
Non-Swiss Holders: If the shareholder that receivesour bye-laws, shareholders who wish to propose a distribution from Bunge-Switzerland is not a Swiss tax resident, does not hold the Bunge-Switzerland shares in connection with a permanent establishment or a fixed place of business maintained in Switzerland, and resides in a country that has concluded a treaty for the avoidance of double taxation with Switzerland for which the conditions for the application and protection of and by the treaty are met, then the shareholder may be entitled to a full or partial refund of the withholding tax described above. You should note that the procedures for claiming treaty refunds (and the time frame required for obtaining a refund) may differ from country to country.
Switzerland has entered into bilateral treaties for the avoidance of double taxation with respect to income taxes with numerous countries, including the United States, whereby under certain circumstances all or part of the withholding tax may be refunded.
U.S. Residents: The Swiss-U.S. tax treaty provides that U.S. residents eligible for benefits under the treaty can seek a refund of the Swiss withholding tax on dividends for the portion exceeding 15% (leading to a refund of 20%) or a 100% refund in the case of qualified pension funds. Please refer to the discussion under “—U.S. Federal Income Tax Considerations—U.S. Holders—Taxation of Distributions on the Bunge-Switzerland Shares” for applicability of U.S. foreign tax credits for any net withholding taxes paid.
As a general rule, the refund will be granted under the treaty if the U.S. resident can show evidence of:
•beneficial ownership,
•U.S. residency, and
•meeting the U.S.-Swiss tax treaty’s limitation on benefits requirements.
The claim for refund must be filed with the Swiss Federal Tax Administration (Eigerstrasse 65, 3003 Berne, Switzerland), not later than December 31 of the third year following upon the calendar year in which the dividend payments became due. The relevant Swiss tax form is Form 82C for companies, 82E for other entities and 82I for individuals. These forms can be obtained from any Swiss Consulate General in the United States or from the Swiss Federal Tax Administration at the address mentioned above or online. Each form needs to be filled out in triplicate, with each copy duly completed and signed before a notary public in the United States. You must also include evidence that the withholding tax was withheld at the source.
Swiss Transfer Stamp Tax in Relation to the Transfer of Bunge-Switzerland Shares: The purchase or sale of Bunge-Switzerland shares may be subject to Swiss federal stamp taxes on the transfer of securities irrespective of the place of residency of the purchaser or seller if the transaction takes place through or with a Swiss bank or other Swiss securities dealer, as those terms are defined in the Federal Stamp Tax Act of 1973 and no exemption applies in the specific case. If a purchase or sale is not entered into through or with a Swiss bank or other Swiss securities dealer, then no stamp tax will be due. The applicable stamp tax rate is 0.075% for each of the two parties to a transaction and is calculated based on the purchase price or sale proceeds. If the transaction does not involve cash consideration, the transfer stamp duty is computed on the basis of the market value of the consideration.
Bermuda Tax Considerations
The Redomestication will not result in any income tax consequences under Bermuda law to Bunge-Bermuda, Bunge-Switzerland, Bunge-MergerCo or their respective shareholders.
The discussion in this section “Certain Tax Considerations” is for general information only and may not address all tax considerations that may be significant to shareholders.
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DESCRIPTION OF BUNGE-SWITZERLAND SHARES |
The following description of Bunge-Switzerland’s share capital is a summary. This summary is not complete and is subject to the complete text of Bunge-Switzerland's proposed articles of association and organizational regulations (the latter being analogous to bylaws). Except where otherwise indicated, the description below reflects Bunge-Switzerland’s articles of association and organizational regulations as those documents will be in effect upon completion of the Redomestication. We encourage you to read those documents carefully.
Capital Structure
Immediately after the Redomestication, Bunge-Switzerland will only have one class of shares outstanding, registered shares with a par value of $[0.01] per share.
Issued Share Capital: In the Redomestication, Bunge-Switzerland will issue one registered share for each issued and outstanding Bunge-Bermuda share. In addition, Bunge-Switzerland will issue [●] Treasury Shares to Bunge-Bermuda for future use to satisfy Bunge-Switzerland’s obligations to deliver registered shares in connection with awards granted under equity incentive plans and for such other purposes as Bunge-Switzerland's Board of Directors may determine. Bunge-Switzerland will assume Bunge-Bermuda’s existing obligation to deliver shares under such equity incentive plans. Upon completion of the Redomestication, the registered share capital of Bunge-Switzerland is expected to be approximately [●], comprised of approximately [●] million registered shares, including [●] Treasury Shares and [●] shares issued in connection with the formation of Bunge-Switzerland.
Capital Band: Immediately prior to the Redomestication, Bunge-Switzerland will not have any share capital authorized for future issuance. Upon completion of the Redomestication, Bunge-Switzerland will have a capital band ranging from $[●] (lower limit) to $[●] (upper limit) and the Board of Directors will be authorized to increase or reduce, within such range, the share capital once or several times and in any amount or to repurchase or dispose of registered shares directly or indirectly, until the earlier of [●], 2028 or the full use of the capital band, without shareholder approval.
In the event of a share issuance based on Bunge-Switzerland's capital band, the Board of Directors determines the date of the issuance, the issuance price, the type of contribution, the date from which the new registered shares carry the right to distributions and, subject to the provisions of Bunge-Switzerland’s articles of association, the conditions for the exercise of the subscription rights with respect to the issuance. The Board of Directors may allow subscription rights that are not exercised to expire, or it may place such rights or registered shares, the subscription rights of which have not been exercised, at market conditions or use them otherwise in the interest of Bunge-Switzerland. After [●], 2028 (or earlier, upon full use of the capital band), capital band will be available to the Board of Directors for issuance of additional registered shares only if the authorization is reapproved by shareholders.
In a share issuance based on Bunge-Switzerland's capital band, Bunge-Switzerland and Bunge-Switzerland’s shareholders have subscription rights to obtain newly issued registered shares in an amount proportional to the par value of the registered shares they already hold. However, the Board of Directors may withdraw or limit these subscription rights in certain circumstances as set forth in Bunge-Switzerland’s articles of association. For further details on these circumstances, see “—Preemptive Rights and Advance Subscription Rights.”
Conditional Share Capital: Immediately prior to the Redomestication, Bunge-Switzerland will not have any conditional share capital. Upon completion of the Redomestication, Bunge-Switzerland’s articles of association will provide for a conditional capital that, following the effectiveness of the Redomestication, will authorize the issuance of additional registered shares up to a maximum amount of [●]% of the share capital registered in the commercial register (which is expected to be approximately [●] registered shares) without obtaining additional shareholder approval. These registered shares may be issued:
•with respect to up to [●] fully paid-in registered shares, the exercise or mandatory exercise of conversion, exchange, exercise, option, warrant, subscription or other rights to acquire registered or through obligations to acquire registered shares, which are or were granted to or imposed upon shareholders or third parties alone or in connection with bonds, notes, loans, options, warrants or other securities or contractual obligations of Bunge-Switzerland or any of its group companies; or
•with respect to up to [●] fully paid-in registered shares, the exercise or mandatory exercise of rights to acquire registered shares or through obligations to acquire registered shares, which are or were granted to or imposed on members of the Board of Directors, members of the executive management, employees, contractors or consultants of Bunge-Switzerland or its group companies, or other persons providing services to Bunge-Switzerland or its group companies.
In connection with the issuance of bonds, notes, loans, options, warrants or other securities or contractual obligations convertible into or exercisable or exchangeable for Bunge-Switzerland registered shares, the Board of Directors is authorized to withdraw or limit the advance subscription rights of shareholders in certain circumstances. See “—Substantive Rights and Advance Subscription Rights” below.
The subscription rights of shareholders are excluded with respect to registered shares issued to directors, employees, contractors, consultants or other persons providing services to Bunge-Switzerland or any of its group companies.
Other Classes or Series of Shares: The Board of Directors may not create shares with increased voting powers without the affirmative resolution adopted by shareholders holding at least 66 2/3% of the voting rights and a majority of the par value of the registered shares represented at a general meeting.
Subscription Rights and Advance Subscription Rights
Under the Swiss Code, the prior approval of a general meeting of shareholders is generally required to authorize, for later issuance, the issuance of registered shares, or rights to subscribe for, or convert into, registered shares (which rights may be connected to debt instruments or other financial obligations). In addition, the existing shareholders will have subscription rights in relation to such registered shares or rights in proportion to the respective par values of their holdings. The shareholders may, with the affirmative vote of shareholders holding 66 2/3% of the voting rights and a majority of the par value of the registered shares represented at the general meeting, withdraw or limit the subscription rights for valid reasons (such as a merger, an acquisition or any of the reasons authorizing the Board of Directors to withdraw or limit the subscription rights of shareholders in the context of an authorized capital increase as described below).
If the general meeting of shareholders has approved the creation of a capital band or conditional share capital, it thereby delegates the decision whether to withdraw or limit the subscription and advance subscription rights for valid reasons to the Board of Directors. Bunge-Switzerland’s articles of association provide for this delegation with respect to Bunge-Switzerland’s capital band and conditional share capital in the circumstances described below under “—Authorized Share Capital” and “—Conditional Share Capital.”
Capital Band: The Board of Directors is authorized to withdraw or limit the subscription rights with respect to the issuance of registered shares based on the capital band and allocate such rights to third parties (including individual shareholders), the company or any of its group companies if:
•the issue price of the new registered shares is determined by reference to the market price;
•for raising equity capital in a fast and flexible manner, which would not be possible, or would only be possible with great difficulty or at significantly less favorable conditions, without the exclusion of the subscription rights of existing shareholders;
•for the acquisition of companies, part(s) of companies or participations, for the acquisition of products, intellectual property or licenses by or for investment projects of Bunge-Switzerland or any of its group companies, or for the financing or refinancing of any of such transactions through a placement of registered shares;
•for purposes of broadening the shareholder constituency of Bunge-Switzerland in certain financial or investor markets, for purposes of the participation of strategic partners including financial investors, or in connection with the listing of new registered shares on domestic or foreign stock exchanges;
•for purposes of granting an over-allotment option of up to 20% of the total number of registered shares in a placement or sale of registered shares to the respective initial purchaser(s) or underwriter(s);
•for the participation of members of the Board of Directors, members of the executive management, employees, contractors, consultants or other persons performing services for the benefit of Bunge-Switzerland or any of its group companies;
•following a shareholder or a group of shareholders acting in concert having accumulated shareholdings in excess of 15% of the share capital registered in the commercial register without having submitted to all other shareholders a takeover offer recommended by the Board of Directors; or
•for the defense of an actual, threatened or potential takeover offer that the Board of Directors, upon consultation with an independent financial adviser retained by it, has not recommended or will not recommend to the shareholders to accept on the basis that the Board of Directors does not find such takeover bid to be financially fair to the shareholders.
Conditional Share Capital: In connection with the issuance of bonds, notes, loans, options, warrants or other securities or contractual obligations convertible into or exercisable or exchangeable for Bunge-Switzerland registered shares, the subscription rights of shareholders are excluded and the Board of Directors is authorized to withdraw or limit the advance subscription rights of shareholders with respect to registered shares issued from Bunge-Switzerland’s conditional share capital if (1) there is a valid reason to withdraw or limit subscription rights of shareholders in connection with the issuance of shares based on the capital band (see immediately above) or (2) the bonds or similar instruments are issued on appropriate terms.
If the advance subscription rights are withdrawn or limited:
•the acquisition price of the registered shares shall be set taking into account the market price prevailing at the date on which the instruments or obligations are issued and;
•the instruments or obligations may be converted, exchanged or exercised during a maximum period of 30 years from the date of the relevant issuance or entry.
The subscription rights and the advance subscription rights of shareholders are excluded with respect to registered shares issued from Bunge-Switzerland’s conditional share capital to directors, employees, contractors, consultants or other persons providing services to Bunge-Switzerland or any of its group companies.
The subscription rights and the advance subscription rights of shareholders that may be issued subject to a limitation or the withdrawal of subscription rights or advance subscription rights from (i) the capital band pursuant to Bunge-Switzerland’s articles of association and/or (ii) the conditional share capital pursuant to Bunge-Switzerland’s articles of association may not exceed [●] new Shares.
Distributions of Dividends
Under Swiss law, distributions of dividends may be paid out only if the company has sufficient distributable profits from the previous fiscal year, or if the company has freely distributable reserves, including out of capital contribution reserves, each as will be presented on the balance sheet included in the annual standalone statutory financial statements of Bunge-Switzerland. The affirmative vote of shareholders holding a majority of the votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority) must approve distributions of dividends. The Board of Directors may propose to shareholders that a distribution of dividend be paid but cannot itself authorize the dividend.
Under the Swiss Code, if Bunge-Switzerland’s statutory reserves amount to less than 20% of the share capital recorded in the commercial register (i.e., 20% of the aggregate par value of Bunge-Switzerland’s registered capital), then at least 5% of Bunge-Switzerland’s annual profit must be allocated to the statutory profit reserve. The Swiss Code and Bunge-Switzerland’s articles of association permit Bunge-Switzerland to accrue additional reserves. In addition, Bunge-Switzerland is required to create a special reserve on its stand-alone annual statutory balance sheet in the amount of the purchase price of registered shares any of its group companies repurchases, which amount may not be used for dividends or subsequent repurchases. Own shares held directly by Bunge-Switzerland are presented on the stand-alone annual statutory balance sheet as a reduction of total shareholders' equity.
Swiss companies generally must maintain a separate company, stand-alone “statutory” balance sheet for the purpose of, among other things, determining the amounts available for the return of capital to shareholders, including by way of a distribution of dividends. Bunge-Switzerland’s auditor must confirm that a dividend proposal made to shareholders conforms with the requirements of the Swiss Code and Bunge-Switzerland’s articles of association. Dividends are usually due and payable shortly after the shareholders have passed a resolution approving the payment; however, it is also possible to pay dividends or other distributions in, for example, quarterly instalments. Bunge-Switzerland’s articles of association provide that dividends that have not been claimed within five years after the due date become the property of Bunge-Switzerland and are allocated to the statutory profit reserves. For information about deduction of the withholding tax from dividend payments, see “Certain Tax Considerations—Swiss Tax Considerations.”
Bunge-Switzerland is expected to declare any distribution of dividends and other capital distributions in U.S. dollars.
Repurchases of Registered Shares
The Swiss Code limits a company’s ability to hold or repurchase its own registered shares. Bunge-Switzerland and its group companies may only repurchase shares if and to the extent that sufficient freely distributable reserves are available, as described above. The aggregate par value of all Bunge-Switzerland registered shares held by Bunge-Switzerland and its group companies may not exceed 10% of the registered share capital. However, Bunge-Switzerland may repurchase its own registered shares beyond the statutory limit of 10% if the shareholders have passed a resolution at a general meeting of shareholders (including as part of the capital band provision included in Bunge-Switzerland's articles of association) authorizing the Board of Directors to repurchase registered shares in an amount in excess of 10% and the repurchased shares are dedicated for cancellation. Any registered shares repurchased pursuant to such an authorization will then be cancelled either upon the approval of shareholders holding a majority of votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority) or, if the authorization is contained in the capital band provision of Bunge-Switzerland's articles of association, upon Bunge-Switzerland's Board of Directors effecting the cancellation based on the authority granted to it in the capital band provision. Repurchased registered shares held by Bunge-Switzerland or its group companies do not carry any rights to vote at a general meeting of shareholders but are entitled to the economic benefits generally associated with the shares. For information about withholding tax and share repurchases, see “Certain Tax Considerations—Swiss Tax Considerations.”
Reduction of Share Capital
Capital distributions may also take the form of a distribution of cash or property that is based upon a reduction of Bunge-Switzerland’s share capital recorded in the commercial register. Such a capital reduction requires the approval of shareholders holding a majority of votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority). A special audit report must confirm that creditors’ claims remain fully covered despite the reduction in the share capital recorded in the commercial register. On or before the approval by the general meeting of shareholders of the capital reduction, the Board of Directorsdirector nominee must give public notice of the capital reduction resolution in the Swiss Official Gazette of Commerce and notify creditors that they may request, within thirty days, satisfaction of or security for their claims (to the extent that the coverage of creditors' claims prior to the capital reduction has been reduced). The obligation to provide security does not apply if the reduction of the share capital does not jeopardize the satisfaction of the creditors' claims. If an unqualified special audit report is available, the law presumes that creditors' claims are not jeopardized. The presumption may be rebutted by creditors in exceptional circumstances.
General Meetings of Shareholders
The general meeting of shareholders is Bunge-Switzerland’s supreme corporate body. Ordinary and extraordinary shareholders' meetings may be held. Among other things, the following powers will be vested exclusively in the general meeting of shareholders:
•adoption and amendment of Bunge-Switzerland’s articles of association;
•election of the chair and the members of the Board of Directors, the members of the compensation committee, the auditor and the independent voting rights representative;
•approval of the annual business report, the stand-alone statutory financial statements and the consolidated financial statements;
•approval on the allocation of profit shown on the balance sheet contained in the stand-alone statutory financial statements of the company, in particular the determination of dividend and other capital distributions to shareholders (including by way of repayment of statutory capital reserve (such as in the form of qualifying capital contribution reserves);
•discharge of the members of the Board of Directors and the persons entrusted with management from liability for business conduct during the previous fiscal year to the extent such conduct is known to the shareholders;
•the approval of the compensation of the Board of Directors and the executive management team pursuant to the articles of association, and the advisory vote on the report (established under Swiss law) pertaining to the compensation of the company's Board of Directors and executive management in the prior fiscal year;
•the delisting of Bunge-Switzerland equity securities;
•the approval of the report on non-financial matters pursuant to article 964c CO; and
•any other resolutions that are submitted to a general meeting of shareholders pursuant to law, Bunge-Switzerland’s articles of association or by voluntary submission by the Board of Directors (unless a matter is within the exclusive competence of the Board of Directors pursuant to the Swiss Code).
Under the Swiss Code and Bunge-Switzerland’s articles of association, Bunge-Switzerland must hold an annual, ordinary general meeting of shareholders within six months after the end of its fiscal year for the purpose, among other things, of approving the annual (standalone and consolidated) financial statements and the annual report, annually electing the chair of the Board of Directors and the Directors, the members of the compensation committee, and annually approving the maximum aggregate compensation payable to the Board of Directors and the members of the executive management team. The invitation to general meetings must be published in the Swiss Official Gazette of Commerce at least 20 calendar days prior to the relevant general meeting of shareholders. No resolutions may be passed at a shareholders' meeting concerning agenda items for which proper notice was not given. This does not apply, however, to proposals made during a shareholders' meeting to convene an extraordinary meeting or to initiate a special investigation. No previous notification will be required for proposals concerning items included on the agenda or for debates as to which no vote is taken.
Annual general meetings of shareholders may be convened by the Board of Directors or, under certain circumstances, by the auditor. A general meeting of shareholders can be held in Switzerland or abroad. Bunge-Switzerland expects to set the record date for each general meeting of shareholders on a date not more than 20 calendar days prior to the date of each general meeting and announce the date of the general meeting of shareholders prior to the record date.
An extraordinary general meeting of Bunge-Switzerland may be called in the circumstances provided by law, the resolution of the Board of Directors or, under certain circumstances, by the auditor. In addition, the Board of Directors is required to convene an extraordinary general meeting of shareholders if so resolved by the general meeting of shareholders, or if so requested by shareholders holding an aggregate of at least 5% of the registered shares or votes, specifying the items for the agenda and their proposals. If the Board of Directors does not comply with the request to publish the notice of the extraordinary general meeting within a reasonable period of time, but at the latest within 60 days, the requesting shareholders may request the court to order that the meeting be convened.
Under Bunge-Switzerland’s articles of association, shareholders who hold, alone or together, at least 0.5 percent of the share capital or votes and are insofar recorded in the share register may request that an item be included on the agenda of a general meeting of shareholders. Such shareholder may also nominate one or more directors for election. A request for inclusion of an item on the agenda must be in writing and received by Bunge-Switzerland at least 120 but not more than 150 calendar days prior to the meeting. To nominate a nominee, the shareholder must, no earlier than 150 calendar days and no later than 120 calendar days prior to the first anniversary of the date (as stated in the Bunge-Switzerland proxy materials) on which the Bunge-Switzerland definitive proxy statement for the prior year’s annual general meeting was first released to Bunge-Switzerland’s shareholders, deliver awritten notice to and such notice must be received by, Bunge-Switzerlandour Corporate Secretary at itsour registered office; provided, however, that if the annual general meeting is not scheduled to be held within a period beginning 30 days before such anniversary date and ending 30 days after such anniversary date, the notice shall be given in the manner provided herein by the later of the close of business on the date that is 180 days prior to such other meeting date or the tenth day following the date that Bunge-Switzerland first makes public disclosure regarding such other meeting date. The request must specify the relevant agenda items and proposals, together with evidence of the required shares recorded in the share register, as well as any other information as would be required to be included in a proxy statement pursuant to the rules of the SEC.
Under the Swiss Code, a general meeting of shareholders for which a notice of meeting has been duly published may not be adjourned without publishing a new notice of meeting.
Voting
Each Bunge-Switzerland registered share carries one voteaddress at a general meeting of shareholders. Voting rights may be exercised by shareholders registered in Bunge-Switzerland’s share register, through the independent voting rights representative elected by shareholders at each annual general meeting, their legal representative or, on the basis of a written proxy, by any other representative who need not be a shareholder.
Shareholders wishing to exercise their voting rights who hold their shares through a broker, bank or other nominee should follow the instructions provided by such broker, bank or other nominee or, absent instructions, contact such broker, bank or other nominee for instructions. Shareholders holding their shares through a broker, bank or other nominee will not automatically be registered in Bunge-Switzerland's share register. If any such shareholder wishes to be registered in Bunge-Switzerland's share register, such shareholder should contact the broker, bank or other nominee through which it holds Bunge-Switzerland shares.
Bunge-Switzerland’s articles of association do not limit the number of registered shares that may be voted by a single shareholder.
Treasury shares, whether owned by Bunge-Switzerland or one of Bunge-Switzerland’s controlled subsidiaries, will not be entitled to vote at general meetings of shareholders.
Pursuant to the Swiss Code, shareholders have the exclusive right to determine the following matters:
•adoption and amendment of Bunge-Switzerland’s articles of association;
•election of members of the board of directors, its chair, the members of the compensation committee, the independent voting rights representative, and the statutory auditor;
•approval of the annual business report, the stand-alone statutory financial statements and the consolidated financial statements;
•approval on the allocation of profit shown on the balance sheet contained in the stand-alone statutory financial statements of the company, in particular the determination of dividend and other capital distributions to shareholders (including by way of repayment of statutory capital reserve (such as in the form of qualifying capital contribution reserves);
•discharge of the members of the board of directors from liability for previous business conduct to the extent such conduct is known to the shareholders; and
•the approval of the compensation of the board of directors and the executive management team pursuant to the articles of association, and the advisory vote on the report (established under Swiss law) pertaining to the compensation of the company's board of directors and executive management in the prior fiscal year;
•the delisting of Bunge-Switzerland equity securities;
•the approval of the report on non-financial matters pursuant to article 964c CO; and
•any other resolutions that are submitted to a general meeting of shareholders pursuant to law, Bunge-Switzerland’s articles of association or by voluntary submission by the board of directors (unless a matter is within the exclusive competence of the board of directors pursuant to the Swiss Code).
Pursuant to Bunge-Switzerland’s articles of association, the shareholders generally pass resolutions by the affirmative vote of a majority of the votes cast at the meeting (broker nonvotes, abstentions and blank and invalid ballots will be disregarded), unless otherwise provided by law or Bunge-Switzerland’s articles of association. In an election in which the number of candidates exceeds the number of the respective positions that are on the agenda at the general meeting, the candidates are elected by a plurality of the votes cast at the general meeting, such that the candidates receiving the most affirmative votes (up to the number of candidates to be elected) are elected and a majority votes cast shall not be a prerequisite to the election.
In addition, the NYSE requires a shareholder vote for certain matters such as:
•the approval of equity compensation plans (or certain amendments to such plans);
•the issuance of shares equal to or in excess of 20% of the voting power of the shares outstanding before the issuance of such shares (subject to certain exceptions, such as public offerings for cash and certain bona fide private placements);
•certain issuances of shares to related parties; and
•issuances of shares that would result in a change of control.
For these types of matters, the minimum vote which will constitute shareholder approval for NYSE listing purposes is the approval by a majority of votes cast, provided that the total vote cast on the proposal represents over 50% in interest of all securities entitled to vote on the proposal.
The Swiss Code requires the affirmative vote of at least two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at a general meeting to approve the following matters:
•the amendment to or the modification of the purpose of Bunge-Switzerland;
•the combination of shares listed on a stock exchange;
•an increase in share capital through the conversion of equity surplus, against contributions in kind or by way of set-off with a receivable and the granting of special privileges;
•the limitation or withdrawal of subscription rights;
•the introduction of conditional share capital or the introduction of a capital band;
•the restriction of the transferability of registered shares and the cancellation of such a restriction;
•the introduction of shares with privileged voting rights;
•the change of currency of the share capital;
•the introduction of the casting vote of the acting chair in the general meeting;
•the delisting of Bunge-Switzerland’s equity securities;
•the relocation of the place of incorporation of Bunge-Switzerland;
•the introduction of an arbitration provision in the articles of association; and
•the dissolution of Bunge-Switzerland.
The same supermajority voting requirements apply to resolutions in relation to transactions among corporations based on the Merger Act, including a merger, demerger or conversion of a corporation (other than a cash-out or certain squeeze-out mergers, in which minority shareholders of the company being acquired may be compensated in a form other than through shares of the acquiring company, for instance, through cash or securities of a parent company of the acquiring company or of another company—in such a merger, an affirmative vote of 90% of the outstanding registered shares is required). Swiss law may also impose this supermajority voting requirement in connection with the sale of “all or substantially all of its assets” by Bunge-Switzerland. See “—Compulsory Acquisitions; Appraisal Rights” and “—Shareholder Approval of Business Combinations.”
Say on Pay
Bunge-Switzerland is required to hold non-binding shareholder advisory votes on executive compensation required by SEC rules. Bunge-Switzerland holds these advisory votes on an annual basis. In addition, under Swiss law, Bunge-Switzerland is required to hold annual binding shareholder votes on the prospective maximum aggregate amount of compensation of each of Bunge-Switzerland's board of directors (for the period between annual meetings) and the executive management team (for the fiscal year commencing after the annual general meeting at which ratification is sought). Shareholders are further required to vote at each annual general meeting, on an advisory basis, on the compensation report (established under Swiss law) regarding the compensation of the members of the board of directors and the executive management team in the preceding fiscal year.
ESG Matters
Bunge-Switzerland will be required to establish a report on non-financial matters covering the following matters: (1) environmental matters, in particular the CO2 goals; (2) social issues; (3) employee-related issues;(4) respect for human rights; and (5) combating corruption. The report must contain the information required to understand the business performance, the business result, the state of the undertaking and the effects of its activity on the above non-financial matters.
More particularly, the report must include: (1) a description of the business model; (2) a description of the policies adopted in relation to the matters referred to above, including the due diligence applied; (3) a presentation of the measures taken to implement these policies and an assessment of the effectiveness of these measures; (4) a description of the main risks related to the above matters and how the undertaking is dealing with these risks; in particular (a) risks that arise from the undertaking's own business operations, and (b) provided this is relevant and proportionate, risks that arise from its business relationships, products or services; and (5) the main performance indicators for the undertaking's activities in relation to the above matters.
Bunge-Switzerland's board of directors will be required to submit the report to shareholders for approval by the annual general meeting, for the first time in 2024 in relation to financial year 2023.
Quorum for General Meetings
The presence of shareholders, in person or by proxy, holding at least a majority of the registered shares recorded in Bunge-Switzerland’s share register and generally entitled to vote at a meeting, is a quorum for the transaction of business. The board of directors has no authority to waive the quorum requirements stipulated in the articles of association.
Inspection of Books and Records
Under the Swiss Code, a shareholder has a right to inspect the share register with regard to its, his or her own shares and otherwise to the extent necessary to exercise its, his or her shareholder rights. No other person has a right to inspect the share register. The books and correspondence of a Swiss company may be inspected with the express authorization of the general meeting of shareholders or by resolution of the board of directors and subject to the safeguarding of the company’s business secrets. At a general meeting of shareholders, any shareholder is entitled to request information from the board of directors concerning the affairs of the company. Shareholders may also ask the auditor questions regarding its audit of the company. The board of directors and the auditor must answer shareholders’ questions to the extent necessary for the exercise of shareholders’ rights and subject to prevailing business secrets or other material interests of Bunge-Switzerland.
Special Investigation
If the shareholders’ inspection and information rights as outlined above prove to be insufficient, any shareholder may propose to the general meeting of shareholders that specific facts be examined by a special commissioner in a special investigation. If the general meeting of shareholders approves the proposal, Bunge-Switzerland or any shareholder may, within three months after the general meeting of shareholders, request the court at Bunge-Switzerland’s registered office to appoint a special commissioner. If the general meeting of shareholders rejects the request, one or more registered shareholders representing at least 5% of the share capital or voting rights may request the court to appoint a special commissioner. The court will issue such an order if the petitioners can demonstrate that the board of directors, any member of the board or an officer of Bunge-Switzerland infringed the law or Bunge-Switzerland’s articles of association and thereby damaged the company or the shareholders. The costs of the investigation would generally be allocated to Bunge-Switzerland and only in exceptional cases to the petitioners.
Compulsory Acquisitions; Appraisal Rights
Business combinations and other transactions that are binding on all shareholders are governed by the Merger Act. A statutory merger or demerger requires that at least 66 2/3% of the registered shares and a majority of the par value of the registered shares represented at the general meeting of shareholders vote in favor of the transaction. Under the Merger Act, a “demerger” may take two forms:
•a legal entity may divide all of its assets and transfer such assets to other legal entities, with the shareholders of the transferring entity receiving equity securities in the acquiring entities and the transferring entity dissolving upon deregistration in the commercial register; or
•a legal entity may transfer all or a portion of its assets to other legal entities, with the shareholders of the transferring entity receiving equity securities in the acquiring entities.
If a transaction under the Merger Act receives all of the necessary consents, all shareholders would be compelled to participate in the transaction. See “—Voting Rights.”
Swiss companies may be acquired by an acquirer through the direct acquisition of the share capital of the Swiss company. With respect to corporations limited by shares, such as Bunge-Switzerland, the Merger Act provides for the possibility of a so-called “cash-out” or “squeeze-out” merger if the acquirer controls 90% of the outstanding registered shares. In these limited circumstances, minority shareholders of the company being acquired may be compensated in a form other than through shares of the acquiring company (for instance, through cash or securities of a parent company of the acquiring company or of another company). For business combinations effected in the form of a statutory merger or demerger and subject to Swiss law, the Merger Act provides that if the equity rights have not been adequately preserved or compensation payments in the transaction are unreasonable, a shareholder may request the competent court to determine a reasonable amount of compensation.
In addition, under Swiss law, the sale of “all or substantially all of its assets” by Bunge-Switzerland may require a resolution of the general meeting of shareholders passed by holders of at least two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at the general meeting of shareholders. Whether or not a shareholder resolution is required depends on the particular transaction, including whether the following test is satisfied:
•the company sells a core part of its business, without which it is economically impracticable or unreasonable to continue to operate the remaining business;
•the company’s assets, after the divestment, are not invested in accordance with the company’s statutory business purpose; and
•the proceeds of the divestment are not earmarked for reinvestment in accordance with the company’s business purpose but, instead, are intended for distribution to shareholders or for financial investments unrelated to the company’s business.
If all of the foregoing apply, a shareholder resolution would likely be required.
Anti-Takeover Provisions
Bunge-Switzerland’s articles of association have provisions that could have an anti-takeover effect. These provisions are intended to enhance the likelihood of continuity and stability in the composition of the board of directors and in the policies formulated by the board of directors and may have the effect of discouraging actual or threatened changes of control by limiting certain actions that may be taken by a potential acquirer prior to its having obtained sufficient control to adopt a special resolution amending Bunge-Switzerland’s articles of association.
Under the Swiss Code, directors may at any time, with or without cause, be removed from office by resolution of the shareholders at a general meeting of shareholders holding the majority of the votes cast at the general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority), provided that a proposal for such resolution has been put on the agenda for the meeting in accordance with the requirements of the Swiss Code and Bunge-Switzerland’s articles of association.
Under Swiss law, there is generally no prohibition of business combinations with interested shareholders. Any transactions of a company with interested shareholders must be done at arm's length terms and may not be unduly discriminatory to other shareholders. In certain circumstances, shareholders and members of the board of directors of Swiss companies, as well as certain persons associated with them, must refund any payments they receive that are not made on an arm’s length basis.
Upon completion of the Redomestication, Bunge-Switzerland’s articles of association will include a capital band provision, according to which the board of directors is authorized, at any time during a five-year period, to limit or withdraw the subscription rights of the existing shareholders in various circumstances, including (1) following a shareholder or a group of shareholders acting in concert having accumulated shareholdings in excess of 15% of the share capital registered in the commercial register without having submitted to all other shareholders a takeover offer recommended by the board of directors; or (2) for the defense of an actual, threatened or potential takeover offer that the board of directors, upon consultation with an independent financial adviser retained by it, has not recommended or will not recommend to the shareholders to accept on the basis that the board of directors does not find such takeover bid to be financially fair to the shareholders.
For other provisions that could be considered to have an anti-takeover effect, in addition to “—Preemptive Rights and Advance Subscription Rights” and “—General Meetings of Shareholders” above, see “—Corporate Governance” below.
Legal Name; Formation; Fiscal Year; Registered Office
The legal and commercial name of Bunge-Switzerland is[●]. Bunge-Switzerland was initially formed on [●], 2023. Bunge-Switzerland is incorporated and domiciled in Geneva, Switzerland, and operates under the Swiss Code as a stock corporation (Aktiengesellschaft/ Société Anonyme). Bunge-Switzerland is recorded in the Commercial Register of the Canton of Geneva with the registration number [●]. Bunge-Switzerland’s fiscal year is the calendar year.
The address of Bunge-Switzerland’s registered office and principal executive office is [●], [●], Geneva, Switzerland, and the telephone number at that address is +41-[●].
Corporate Purpose
Currently, Bunge-Switzerland is a subsidiary of Bunge-Bermuda, and its business purpose is to acquire, hold, manage, exploit and sell, whether directly or indirectly, participations in businesses in Switzerland and abroad, in particular businesses that are involved in the utilization of agricultural resources, and to provide financing for this purpose. Upon completion of the Redomestication, Bunge-Switzerland will become the new holding company of the Bunge group of companies. Bunge-Switzerland’s amended business purpose will be to acquire, hold, manage, exploit and sell, whether directly or indirectly, participations in businesses in Switzerland and abroad including, without limitation, the development, processing and marketing of agricultural fuel and other products and services. Bunge-Switzerland may engage in all other types of transactions that appear appropriate to promote, or are related to, the business purpose of the company. Bunge-Switzerland may acquire, hold, manage, mortgage and sell real estate and intellectual property rights in Switzerland and abroad and may also fund other companies, in Switzerland or abroad.
Duration; Dissolution; Rights upon Liquidation
Bunge-Switzerland’s duration is unlimited. Bunge-Switzerland may be dissolved at any time with the approval of shareholders holding two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at a general meeting. Dissolution by court order is possible if Bunge-Switzerland becomes bankrupt, or for cause at the request of shareholders holding at least 10% of Bunge-Switzerland’s share capital. Under Swiss law, any surplus arising out of liquidation, after the settlement of all claims of all creditors, will be distributed to shareholders in proportion to the paid-up par value of registered shares held, subject to Swiss withholding tax requirements of 35%, all or part of which can potentially be reclaimed under the relevant tax rules in Switzerland or double taxation treaties concluded between Switzerland and foreign countries. Bunge-Switzerland's shares carry no privilege with respect to such liquidation surplus.
Uncertificated Shares
Bunge-Switzerland currently issues registered shares in uncertificated, book-entry form.
Stock Exchange Listing
Upon the completion of the Redomestication, the registered shares will be listed on the New York Stock Exchange and trade under the symbol “BG.”
No Sinking Fund
The registered shares have no sinking fund provisions.
No Liability for Further Calls or Assessments
The registered shares to be issued in the Redomestication will be duly and validly issued, fully paid and nonassessable.
No Redemption and Conversion
The registered shares are not convertible into shares of any other class or series or subject to redemption either by Bunge-Switzerland or the holder of the shares.
Transfer and Registration of Shares
No restrictions apply to the transfer of Bunge-Switzerland registered shares. So long as and to the extent that Bunge-Switzerland's shares are intermediated securities within the meaning of the Swiss Federal Intermediated Securities Act, (i) any transfer of Bunge-Switzerland's shares is effected by a corresponding entry in the securities deposit account of a bank or a depository institution, (ii) no Bunge-Switzerland shares can be transferred by way of assignment, and (iii) a security interest in any Bunge-Switzerland shares cannot be granted by way of assignment. Any person who acquires Bunge-Switzerland's shares may submit a request to Bunge-Switzerland to be entered into the share register as a shareholder with voting rights, provided such persons expressly declare that they have acquired the shares in their own name and for their own account, that there is no agreement on the redemption of the shares and that they bear the economic risk associated with the shares. Bunge-Switzerland's Board of Directors may record nominees who hold shares in their own name, but for the account of third parties, as shareholders of record with voting rights in the share register of the Company. Beneficial owners of shares who hold shares through a nominee exercise the shareholders' rights through the intermediation of such nominee. Bunge-Switzerland’s share register will initially be kept by Computershare Inc., which acts as transfer agent and registrar. The share register reflects only record owners of Bunge-Switzerland shares. Swiss law does not recognize fractional share interests.
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COMPARISON OF RIGHTS OF SHAREHOLDERS |
Your rights as a shareholder of Bunge-Bermuda are governed byClarendon House, 2 Church Street, Hamilton HM 11, Bermuda, law and Bunge-Bermuda’s memorandum of association and bye-laws. After the Redomestication, you will become a shareholder of Bunge-Switzerland, and your rights will be governed by Swiss law and Bunge-Switzerland’s articles of association and organizational regulations (the latter being analogous to bye-laws).
Many of the principal attributes of Bunge-Bermuda’s ordinary shares and Bunge-Switzerland’s registered shares will be similar. However, there are differences between your rights under Swiss law and under the corporate statutory and common law of Bermuda, which is modeled on certain provisions of the corporate statutory law of England and Wales and in respect of which the common law of England and Wales is highly persuasive authority as to questions of Bermuda law. In addition, there are differences between Bunge-Bermuda’s memorandum of association and bye-laws and Bunge-Switzerland’s articles of association and organizational regulations (the latter being analogous to bye-laws). Furthermore, the counterparts of some provisions that are included in Bunge-Bermuda’s memorandum of association and bye-laws are included in Bunge-Switzerland’s organizational regulations. As a result, Bunge-Switzerland’s Board of Directors will be able to amend these provisions without shareholder approval, which Bunge-Bermuda’s Board of Directors is currently unable to do. The following discussion is a summary of material changes in your rights resulting from the Redomestication. This summary is not complete and does not cover all of the differences between Swiss law and Bermuda law affecting companies and their shareholders or all the differences between Bunge-Bermuda’s memorandum of association and bye-laws and Bunge-Switzerland’s articles of association and organizational regulations. We believe this summary is accurate. It is, however, subject to the complete text of the relevant provisions of the Swiss Code of Obligations (the “Swiss Code”), in particular articles 620 through 763 of the Swiss Code, and Switzerland’s Federal Act on Mergers, Demergers, Transformations and the Transfer of Assets (the “Merger Act”), the Companies Act 1981 of Bermuda (the “Companies Act”), Bunge-Bermuda’s memorandum of association and bye-laws and Bunge-Switzerland’s articles of association and organizational regulations.
Capitalization
Bunge-Bermuda: As of [●], 2022, the authorized share capital of Bunge-Bermuda was $4,210,000 composed of 400,000,000 common shares, par value $0.01 per share, and 21,000,000 preference shares, par value $0.01 per share. In addition, as of such date, Bunge-Bermuda held [●] common shares in treasury. The Board of Directors of Bunge-Bermuda may authorize the issuance of additional shares up to the amount of the authorized capital without obtaining additional shareholder approval (subject to any applicable requirements of the NYSE). The Board of Directors of Bunge-Bermuda may also approve the issuance of partly paid and unpaid common shares, as well as fractional common shares.
Bunge-Switzerland: In connection with the Redomestication, Bunge-Switzerland will issue one registered share for each Bunge-Bermuda share. In addition, Bunge-Switzerland will create [●] million Treasury Shares for future use to satisfy Bunge-Switzerland’s obligations to deliver registered shares in connection with awards granted under equity incentive plans or for such other purposes as Bunge-Switzerland's Board of Directors may determine. Bunge-Switzerland's total issued share capital upon completion of the Redomestication is therefore expected to amount to $[●], consisting of [●] registered shares, each with a par value of $0.01. The Board of Directors may not create shares with increased voting powers without the affirmative resolution adopted by shareholders holding at least 66 2/3% of the voting rights and a majority of the par value of the registered shares, each as represented at a general meeting. Immediately after the Redomestication, Bunge-Switzerland will only have one class of shares outstanding, so all references to “voting rights” in this “Comparison of Rights of Shareholders” will mean the voting rights of Bunge-Switzerland’s registered shares, unless another class of shares is subsequently created upon a shareholder resolution adopted at a general meeting. Likewise, a “majority of the par value of the registered shares” will mean a majority of the par value of Bunge-Switzerland’s registered shares with a $[0.01] par value per share.
Immediately prior to the Redomestication, Bunge-Switzerland will not have any share capital authorized for future issuance. Upon completion of the Redomestication, Bunge-Switzerland will have a capital band ranging from $[●] (lower limit) to $[●] (upper limit), corresponding to a range of [●]% calculated by reference to Bunge-Switzerland's capital upon completion of the Redomestication (which is expected to be approximately $[●]), and the Board of Directors will be authorized to increase or reduce the share capital once or several times and in any amount or to repurchase or dispose of registered shares directly or indirectly, until the earlier of the expiration of five years after the adoption of the capital band by shareholders at the general meeting of shareholders approving the Redomestication or the full use of the capital band, without shareholder approval.
In the event of a capital increase based on the capital band, the Board of Directors determines the date of the issuance, the issuance price, the type of contribution, the date from which the new registered shares carry the right to dividends and, subject to the provisions of Bunge-Switzerland’s articles of association, the conditions for the exercise of the subscription rights with respect to the issuance. The Board of Directors may allow subscription rights that are not exercised to expire, or it may place such rights or registered shares, the subscription rights of which have not been exercised, at market conditions or use them otherwise in the interest of Bunge-Switzerland. After the expiration of the initial five-year period or the full use of the capital band, the capital band will be available to the Board of Directors for issuance of additional registered shares only if a new capital band is reapproved by shareholders.
In a share issuance based on Bunge-Switzerland's capital band, Bunge-Switzerland’s shareholders would have subscription rights to obtain newly issued registered shares in an amount proportional to the par value of the registered shares they already hold. However, the Board of Directors may withdraw or limit these subscription rights in certain circumstances as set forth in Bunge-Switzerland’s articles of association. For further details on these circumstances, see “—Subscription Rights and Advance Subscription Rights.”
Immediately prior to the Redomestication, Bunge-Switzerland will not have any conditional share capital. Upon completion of the Redomestication, Bunge-Switzerland’s articles of association will provide for a conditional share capital that, following the effectiveness of the Redomestication, will authorize the issuance of additional registered shares up to a maximum amount of [●]% of the share capital registered in the commercial register (which is expected to be approximately [●] registered shares) without obtaining additional shareholder approval. These registered shares may be issued:
•with respect to up to [●] fully paid-in registered shares, through the exercise or mandatory exercise of conversion, exchange, exercise, option, warrant, subscription or other rights to acquire registered or through obligations to acquire registered shares, which are or were granted to or imposed upon shareholders or third parties alone or in connection with bonds, notes, loans, options, warrants or other securities or contractual obligations of Bunge-Switzerland or any of its group companies; or
•with respect to up to [●] fully paid-in registered shares, through the exercise or mandatory exercise of rights to acquire registered shares or through obligations to acquire registered shares, which are or were granted to or imposed on members of the Board of Directors, members of the executive management, employees, contractors or consultants of Bunge-Switzerland or its group companies, or other persons providing services to Bunge-Switzerland or its group companies.
In connection with the issuance of bonds, notes, loans, options, warrants or other securities or contractual obligations convertible into or exercisable or exchangeable for Bunge-Switzerland registered shares, the Board of Directors is authorized to withdraw or limit the advance subscription rights of shareholders in certain circumstances. See “—Subscription Rights and Advance Subscription Rights.”
The advance subscription rights and subscription rights of shareholders are excluded with respect to registered shares issued to directors, employees, contractors or other persons providing services to Bunge-Switzerland or one of its subsidiaries.
The subscription rights and the advance subscription rights of shareholders that may be issued subject to a limitation or the withdrawal of subscription rights or advance subscription rights from (i) the capital band pursuant to Bunge-Switzerland’s articles of association and/or (ii) the conditional share capital pursuant to Bunge-Switzerland’s articles of association may not exceed [●] new Shares.
Bunge-Bermuda: Holders of Bunge-Bermuda common shares have no subscription or preferential right to purchase any securities of Bunge-Bermuda. As a result, as described below under “— Other Anti-Takeover Measures,” the Board of Directors may authorize the issuance of securities that could discourage a takeover or other transaction without offering the securities to each holder of Bunge-Bermuda common shares.
Bunge-Switzerland: Under the Swiss Code, the prior approval of a general meeting of shareholders is generally required to authorize, for later issuance, the issuance of registered shares, or rights to subscribe for, or convert into, registered shares (which rights may be connected to debt instruments or other obligations). In addition, the existing shareholders will have subscription rights in relation to such registered shares or rights in proportion to the respective par values of their holdings. The shareholders may, with the affirmative vote of shareholders holding 66 2/3% of the voting rights and a majority of the par value of the registered shares, each as represented at the general meeting, withdraw or limit the subscription rights for valid reasons (such as a merger, an acquisition or any of the reasons authorizing the Board
of Directors to withdraw or limit the subscription rights of shareholders in the context of an authorized capital increase as described below).
If the general meeting of shareholders has approved the creation of a capital band or conditional capital, it thereby delegates the decision whether to withdraw or limit the subscription and advance subscription rights for the valid reasons specified in the articles of association to the Board of Directors. Bunge-Switzerland’s articles of association provide for such a delegation with respect to Bunge-Switzerland’s capital band and conditional share capital in the circumstances described below.
The Board of Directors is authorized to withdraw or limit the subscription rights with respect to the issuance of registered shares based on the capital band and allocate such rights to third parties (including individual shareholders), the company or any of its group companies:
•if the issue price of the new shares is determined by reference to the market price; or
•for raising equity capital in a fast and flexible manner, which would not be possible, or would only be possible with great difficulty or at significantly less favorable conditions, without the exclusion of the subscription rights of existing shareholders; or
•for the acquisition of companies, part(s) of companies or participations, for the acquisition of products, intellectual property or licenses by or for investment projects of the company or any of its group companies, or for the financing or refinancing of any of such transactions through a placement of shares; or
•for purposes of broadening the shareholder constituency of the company in certain financial or investor markets, for purposes of the participation of strategic partners including financial investors, or in connection with the listing of new shares on domestic or foreign stock exchanges; or
•for purposes of granting an over-allotment option (Greenshoe) of up to 20% of the total number of shares in a placement or sale of shares to the respective initial purchaser(s) or underwriter(s); or
•for the participation of members of the Board of Directors, members of the executive management, employees, contractors, consultants or other persons performing services for the benefit of the Company or any of its group companies; or
•following a shareholder or a group of shareholders acting in concert having accumulated shareholdings in excess of 15% of the share capital registered in the commercial register without having submitted to all other shareholders a takeover offer recommended by the Board of Directors; or
•for the defense of an actual, threatened or potential takeover offer that the Board of Directors, upon consultation with an independent financial adviser retained by it, has not recommended or will not recommend to the shareholders to accept on the basis that the Board of Directors does not find such takeover bid to be financially fair to the shareholders.
In connection with the issuance of bonds, notes, loans, options, warrants or other securities or contractual obligations convertible into or exercisable or exchangeable for Bunge-Switzerland registered shares, the subscription rights of shareholders are excluded and the Board of Directors is authorized to withdraw or limit the advance subscription rights of shareholders with respect to registered shares issued from Bunge-Switzerland’s conditional share capital if (1) there is a valid reason to withdraw or limit subscription rights of shareholders as provided for in connection with the issuance of shares based on the capital band (see immediately above) or (2) the bonds or similar instruments are issued on appropriate terms.
If the advance subscription rights are neither granted directly nor indirectly by the Board of Directors, the following applies:
•the acquisition price of the shares shall be set taking into account the market price prevailing at the date on which bonds, notes, loans, options, warrants or other securities or contractual obligations of the Company or any of its group companies are issued; and
•bonds, notes, loans, options, warrants or other securities or contractual obligations of the Company or any of its group companies may be converted, exchanged or exercised during a maximum period of 30 years from the date of the relevant issuance or entry.
In connection with the issuance of shares or the exercise or mandatory exercise of rights to acquire shares or the obligations to acquire shares, which are or were granted to or imposed on members of the Board of Directors, members of the executive management, employees, contractors or consultants of Bunge-Switzerland or its group companies, or other persons providing services to Bunge-Switzerland or its group companies, the subscription rights and advance subscription rights of the shareholders of Bunge-Switzerland are excluded.
The subscription rights and the advance subscription rights of shareholders that may be issued subject to a limitation or the withdrawal of subscription rights or advance subscription rights from (i) the capital band pursuant to Bunge-Switzerland’s articles of association and/or (ii) the conditional share capital pursuant to Bunge-Switzerland’s articles of association may not exceed [●] new Shares.
For more information on authorized and conditional capital, see “—Capitalization” above.
Distributions and Dividends; Repurchases and Redemptions
Bunge-Bermuda: Bunge-Bermuda is not required to present proposed dividends or distributions from contributed surplus to its shareholders for approval or adoption. Under section 54 of the Companies Act, Bunge-Bermuda may not declare or pay a dividend, or make a distribution out of contributed surplus, if there are reasonable grounds for believing that:
•Bunge-Bermuda is, or would after the payment be, unable to pay its liabilities as they become due; or
•the realizable value of Bunge-Bermuda's assets would thereby be less than the aggregate of its liabilities and its issued share capital and share premium accounts.
For the purposes of section 54 of the Companies Act, “contributed surplus” includes proceeds arising from donated shares, credits resulting from the redemption or conversion of shares at less than the amount set up as a nominal capital and donations of cash and other assets to the company.
Under the Companies Act, preference shares of a Bermuda company may be redeemed if so authorized by its memorandum of association or bye-laws, provided that;
•no such shares shall be redeemed except out of (i) the capital paid up thereon, (ii) the funds of the company available for dividend or distribution or (iii) the proceeds of a fresh issue of shares made for the purposes of the redemption;
•the premium, if any, payable on redemption, is provided for out of (i) the company’s funds which would be otherwise available for dividend or distribution or (ii) the company’s share premium account before the shares are redeemed; and
•there are no reasonable grounds for believing that the company is, or after such redemption would be, unable to repay its liabilities as they become due.
The redemption of preference shares may be effected on such terms and in such manner as may be provided by or determined in accordance with the bye-laws of the company.
Under the Companies Act, a Bermuda company may repurchase its own shares if so authorized by its memorandum of association or bye-laws, provided that:
•no such shares shall be repurchased except out of (i) the capital paid up thereon, (ii) the funds of the company available for dividend or distribution or (iii) the proceeds of a fresh issue of shares made for the purposes of the repurchase;
•the premium, if any, payable on repurchase, is provided for out of (i) the company’s funds which would be otherwise available for dividend or distribution or (ii) the company’s share premium account before the shares are repurchased; and
•there are no reasonable grounds for believing that the company is, or after such repurchase would be, unable to repay its liabilities as they become due.
The terms and manner of the repurchase need not be provided by, or determined in accordance with, the bye-laws of the company.
Under Bunge-Bermuda’s bye-laws, Bunge-Bermuda may, upon the agreement of a shareholder, repurchase all or part of the common shares of such shareholder, whether or not the company has made a similar offer to all or any of the other shareholders. Bunge-Bermuda’s common shares are not redeemable.
In addition, Bunge-Bermuda’s bye-laws give the board the authority to exercise all of the powers of the company to purchase all or any part of the issued and outstanding shares in accordance with law and any designated stock exchange.
Bunge-Switzerland: Under Swiss law, distribution of dividends may be paid out only if the corporation has sufficient distributable profits from the previous fiscal year, or if the corporation has freely distributable reserves, including out of capital contribution reserves, each as will be presented on the balance sheet included in the annual standalone statutory financial statements of Bunge-Switzerland. The affirmative vote of shareholders holding a majority of the votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority) must approve distributions of dividends. The Board of Directors may propose to shareholders that a distribution of a dividend be paid but cannot itself authorize the distribution of the dividend.
Under the Swiss Code, if Bunge-Switzerland’s statutory reserves amount to less than 20% of the share capital recorded in the commercial register (i.e., 20% of the aggregate par value of Bunge-Switzerland’s registered capital), then at least 5% of Bunge-Switzerland’s annual profit must be allocated to the statutory profit reserve. The Swiss Code and Bunge-Switzerland’s articles of association permit Bunge-Switzerland to accrue additional reserves. In addition, Bunge-Switzerland is required to create a special reserve on its stand-alone annual statutory balance sheet in the amount of the purchase price of registered shares any of its group companies repurchases, which amount may not be used for dividends or subsequent repurchases. Own shares held directly by Bunge-Switzerland are presented on the stand-alone annual statutory balance sheet as a reduction of total shareholders' equity.
Swiss companies generally must maintain a separate company, stand-alone “statutory” balance sheet for the purpose of, among other things, determining the amounts available for the return of capital to shareholders, including by way of a distribution of dividends. Bunge-Switzerland’s auditor must confirm that a dividend proposal made to shareholders conforms with the requirements of the Swiss Code and Bunge-Switzerland’s articles of association. Dividends are usually due and payable shortly after the shareholders have passed a resolution approving the payment; however, it is also possible to pay dividends or other distributions in, for example, quarterly instalments. Bunge-Switzerland’s articles of association provide that dividends that have not been claimed within five years after the due date become the property of Bunge-Switzerland and are allocated to the statutory profit reserves. For information about deduction of the withholding tax from dividend payments, see “Certain Tax Considerations—Swiss Tax Considerations.”
The Swiss Code limits a company’s ability to hold or repurchase its own registered shares. Bunge-Switzerland and its group companies may only repurchase shares if and to the extent that sufficient freely distributable reserves are available, as described above. The aggregate par value of all Bunge-Switzerland registered shares held by Bunge-Switzerland and its group companies may not exceed 10% of the registered share capital. However, Bunge-Switzerland may repurchase its own registered shares beyond the statutory limit of 10% if the shareholders have passed a resolution at a general meeting of shareholders (including as part of the capital band provision included in Bunge-Switzerland's articles of association) authorizing the Board of Directors to repurchase registered shares in an amount in excess of 10% and the repurchased shares are dedicated for cancellation. Any registered shares repurchased pursuant to such an authorization will then be cancelled either upon the approval of shareholders holding a majority of the votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority) or, if the authorization is contained in the capital band provision of Bunge-Switzerland's articles of association, upon Bunge-Switzerland's Board of Directors effecting the cancellation based on the authority granted to it in the capital band provision. Repurchased registered shares held by Bunge-Switzerland or its group companies do not carry any rights to vote at a general meeting of shareholders but are entitled to the economic benefits generally associated with the shares. For information about withholding tax and share repurchases, see “Certain Tax Considerations—Swiss Tax Considerations.”
Capital distributions may also take the form of a distribution of cash or property that is based upon a reduction of Bunge-Switzerland’s share capital recorded in the commercial register. Such a capital reduction requires the approval of shareholders holding a majority of the votes cast at a general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority). A special audit report must confirm that creditors’ claims remain fully covered despite the reduction in the share capital recorded in the commercial register. On or before the approval by the general meeting of shareholders of the capital reduction, the Board of Directors must give public notice of the capital reduction resolution in the Swiss Official Gazette of Commerce and notify creditors that they may request, within thirty days, satisfaction of or security for their claims (to the extent that
the coverage of creditors' claims prior to the capital reduction has been reduced). The obligation to provide security does not apply if the reduction of the share capital does not jeopardize the satisfaction of the creditors' claims. If an unqualified special audit report is available, the law presumes that creditors' claims are not jeopardized. The presumption may be rebutted by creditors in exceptional circumstances.
Bunge-Switzerland is expected to declare any dividends and other capital distributions in U.S. dollars.
Shareholder Approval of Business Combinations
Bunge-Bermuda: The Companies Act provides for compromises or arrangements between a company and its creditors or any class of them or between a company and its shareholders or any class of them. A compromise or arrangement relating to the common shareholders of a company is effected by the relevant Bermuda company applying for the consent of the Bermuda Court to seek, and subsequently obtaining, the approval of a majority in number representing 75% or more in value of the members present and voting either in person or by proxy at the meeting. If such a majority agrees to the compromise or arrangement, the compromise or arrangement will be sanctioned by the Bermuda Court and will be binding on the company and all of the members. Bunge-Bermuda’s Bermuda counsel has advised that where the statutory procedures have been complied with, the Bermuda Court is likely to sanction such a compromise or arrangement that has been approved by the requisite votes of shareholders in the absence of bad faith, fraud or unequal treatment of shareholders.
Bermuda companies may also engage in a business combination through the direct acquisition by an acquirer of the share capital of the Bermuda company. The Companies Act provides that when an offer is made for the shares of a Bermuda company by another company (the “transferee”) and, within four months of the offer, the holders of not less than 90% of those shares (other than shares held at the date of the offer by, or by a nominee for, the transferee) approve the offer, the transferee may, at any time within two months beginning with the date when such 90% approval is obtained, give notice to any dissenting shareholder to transfer their shares on the same terms as the original offer. The transferee shall be entitled and bound to acquire the shares of dissenting shareholders within one month of such notice, unless the Bermuda Court has ordered otherwise.
The Companies Act also allows the holders of not less than 95% of the shares of any class of a company (referred to as the “purchasers”) to give notice to the remaining shareholders of such class of their intention to acquire the shares of the remaining shareholders on the terms set forth in the notice. When such notice is given, the purchasers are entitled to acquire the shares of the remaining shareholders and are bound by the terms set forth in the notice, unless a remaining shareholder applies to a Bermuda Court for an appraisal of the value of the shares to be purchased from him or her within one month of receiving the notice. Within one month of the Bermuda Court appraising the value of the shares, which appraisal may not be appealed, the purchasers are entitled to acquire the remaining shares at the price fixed by the Bermuda Court or cancel the acquisition notice.
Under Bermuda law, two or more companies can amalgamate and continue as one company (the “amalgamated company”). The Companies Act provides for a Bermuda exempted company to amalgamate with (i) a Bermuda local company, (ii) a Bermuda exempted company or (iii) a foreign corporation. The statutory threshold for approval of an amalgamation is 75% of shareholders voting at a special general meeting or such lower majority as is stipulated in the bye-laws of the company.
Under Bermuda law, two or more companies can merge and continue as one of such companies (the “surviving company”). The Companies Act provides for a Bermuda exempted company to merge with (i) a Bermuda local company, (ii) a Bermuda exempted company or (iii) a foreign corporation. In each case, the surviving entity can take the form of any of the merging entities. The statutory threshold for approval of a merger is 75% of shareholders voting at a special general meeting or such lower majority as is stipulated in the bye-laws of the company.
Bunge-Bermuda’s bye-laws provide that any matter submitted to the shareholders at a general meeting for approval, including for the amalgamation, merger or consolidation of the company with another company, or the sale, lease or exchange of all or substantially all of the assets of the company, must be approved by a majority of the votes cast.
Although Bunge-Bermuda’s bye-laws contain the provision described above, Bermuda law does not impose a separate shareholder approval requirement for a sale of substantially all of a company’s assets.
Bunge-Switzerland: Business combinations and other transactions that are binding on all shareholders are governed by the Merger Act. A statutory merger or demerger requires that at least 66 2/3% of the registered shares and a majority of the par value of the registered shares, each as represented at the general meeting of shareholders, vote in favor of the transaction.
Under the Merger Act, a “demerger” may take two forms:
•a legal entity may divide all of its assets and transfer such assets to other legal entities, with the shareholders of the transferring entity receiving equity securities in the acquiring entities and the transferring entity dissolving upon deregistration in the commercial register; or
•a legal entity may transfer all or a portion of its assets to other legal entities, with the shareholders of the transferring entity receiving equity securities in the acquiring entities.
If a transaction under the Merger Act receives all of the necessary consents, all shareholders would be compelled to participate in the transaction. See “—Voting Rights.”
Swiss companies may be acquired by an acquirer through the direct acquisition of the share capital of the Swiss company. With respect to corporations limited by shares, such as Bunge-Switzerland, the Merger Act provides for the possibility of a so-called “cash-out” or “squeeze-out” merger if the acquirer controls 90% of the outstanding registered shares entitled to vote at a general meeting. In these limited circumstances, minority shareholders of the company being acquired may be compensated in a form other than through shares of the acquiring company (for instance, through cash or securities of a parent company of the acquiring company or of another company). Under the Merger Act, a shareholder has the right to request a court to review the adequacy of the compensation. For more information, see “—Appraisal Rights and Compulsory Acquisitions.”
In addition, under Swiss law, the sale of “all or substantially all of its assets” by Bunge-Switzerland may require a resolution of the general meeting of shareholders passed by holders of at least two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at the general meeting of shareholders. Whether or not a shareholder resolution is required depends on the particular transaction, including whether the following test is satisfied:
•the company sells a core part of its business, without which it is economically impracticable or unreasonable to continue to operate the remaining business;
•the company’s assets, after the divestment, are not invested in accordance with the company’s statutory business purpose; and
•the proceeds of the divestment are not earmarked for reinvestment in accordance with the company’s business purpose but, instead, are intended for distribution to shareholders or for financial investments unrelated to the company’s business.
If all of the foregoing apply, a shareholder resolution would likely be required.
Special Vote Required for Combinations with Interested Shareholders
Bunge-Bermuda: The Companies Act provides for compromises or arrangements between a company and its creditors or any class of them or between a company and its shareholders or any class of them. A compromise or arrangement relating to the common shareholders of a company is effected by the relevant Bermuda company applying for the consent of the Bermuda Court to seek, and subsequently obtaining, the approval of a majority in number representing 75% or more in value of the members present and voting either in person or by proxy at the meeting. If such a majority agrees to the compromise or arrangement, the compromise or arrangement will be sanctioned by the Bermuda Court and will be binding on the company and all of the members. Bunge-Bermuda’s Bermuda counsel has advised that where the statutory procedures have been complied with, the Bermuda Court is likely to sanction such a compromise or arrangement that has been approved by the requisite votes of shareholders in the absence of bad faith, fraud or unequal treatment of shareholders.
Bermuda companies may also engage in a business combination through the direct acquisition by an acquirer of the share capital of the Bermuda company. The Companies Act provides that when an offer is made for the shares of a Bermuda company by another company (the “transferee”) and, within four months of the offer, the holders of not less than 90% of those shares (other than shares held at the date of the offer by, or by a nominee for, the transferee) approve the offer, the transferee may, at any time within two months beginning with the date when such 90% approval is obtained, give notice to any dissenting shareholder to transfer their shares on the same terms as the original offer. The transferee shall be entitled and bound to acquire the shares of dissenting shareholders within one month of such notice, unless the Bermuda Court has ordered otherwise.
The Companies Act also allows the holders of not less than 95% of the shares of any class of a company (referred to as the “purchasers”) to give notice to the remaining shareholders of such class of their intention to acquire the shares of the remaining shareholders on the terms set forth in the notice. When such notice is given, the purchasers are entitled to acquire the shares of the remaining shareholders and are bound by the terms set forth in the notice, unless a remaining shareholder applies to a Bermuda Court for an appraisal of the value of the shares to be purchased from him or her within one month of receiving the notice. Within one month of the Bermuda Court appraising the value of the shares, which appraisal may not be appealed, the purchasers are entitled to acquire the remaining shares at the price fixed by the Bermuda Court or cancel the acquisition notice.
Under Bermuda law, two or more companies can amalgamate and continue as one company (the “amalgamated company”). The Companies Act provides for a Bermuda exempted company to amalgamate with (i) a Bermuda local company, (ii) a Bermuda exempted company, or (iii) a foreign corporation. The statutory threshold for approval of an amalgamation is 75% of shareholders voting at a special general meeting or such lower majority as is stipulated in the bye-laws of the company.
Under Bermuda law, two or more companies can merge and continue as one of such companies (the “surviving company”). The Companies Act provides for a Bermuda exempted company to merge with (i) a Bermuda local company, (ii) a Bermuda exempted company or (iii) a foreign corporation. In each case, the surviving entity can take the form of any of the merging entities. The statutory threshold for approval of a merger is 75% of shareholders voting at a special general meeting or such lower majority as is stipulated in the bye-laws of the company.
Bunge-Bermuda’s bye-laws provide that any matter submitted to the shareholders at a general meeting for approval, including for the amalgamation, merger or consolidation of the company with another company, or the sale, lease or exchange of all or substantially all of the assets of the company, must be approved by a majority of the votes cast.
Although Bunge-Bermuda’s bye-laws contain the provision described above, Bermuda law does not impose a separate shareholder approval requirement for a sale of substantially all of a company’s assets.
Bunge-Switzerland: Under Swiss law, there is generally no prohibition of business combinations with interested shareholders. Any transactions of a company with interested shareholders must be done at arm's length terms and may not be unduly discriminatory to other shareholders. In certain circumstances, shareholders and members of the board of directors of Swiss companies, as well as certain persons associated with them, must refund any payments they receive that are not made on an arm’s length basis.
Mandatory Bid Rules
Bunge-Bermuda: Mandatory bid rules do not apply to Bunge-Bermuda.
Bunge-Switzerland: Swiss mandatory bid rules do not apply to Bunge-Switzerland. Pursuant to the Swiss Federal Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives Trading (the “FMIA”), the scope of application of the mandatory bid rules and the cancellation of remaining equity securities pursuant to the FMIA only apply to public takeover offers to equity securities of companies with (i) registered office in Switzerland whose equity securities are at least partly listed on a stock exchange in Switzerland or (ii) registered office abroad whose equity securities are at least in part listed in Switzerland. Bunge-Switzerland will not be listed on a stock exchange located in Switzerland and accordingly, the mandatory bid rules described above are not applicable to Bunge-Switzerland.
Other Anti-Takeover Measures
Bunge-Bermuda: Bermuda law does not expressly prohibit companies from issuing share purchase rights or adopting a shareholder rights plan. However, there is little case law on the enforceability of such plans under Bermuda law. In the adoption of such a plan, the following principles should be observed: (1) the directors take bona fide actions in the best interest of the company as a whole, (2) the powers of the directors are used for a proper purpose, (3) the directors exercise their powers fairly between shareholders and (4) the plan does not penalize any existing shareholders. Under Bunge-Bermuda’s bye-laws, Bunge-Bermuda’s Board of Directors could authorize, without shareholder approval, the issuance of a preferred share purchase right to be attached to each issued and outstanding common share with such terms and for such purposes, including the influencing of takeovers, as determined by the Board of Directors.
The Board of Directors of Bunge-Bermuda is also authorized, without obtaining any vote or consent of the holders of any class or series of shares unless expressly provided by the terms of a class or series, to issue from time to time any other classes or series of shares with the designations and relative powers, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or terms or conditions of redemption as it considers fit. The Board of Directors could authorize the issuance of preference shares with terms and conditions that could discourage
a takeover or other transaction that holders of some or a majority of the common shares might believe to be in their best interests or in which holders might receive a premium for their shares over the then market price of the shares.
For other provisions that could be considered to have an anti-takeover effect, in addition to “— Subscription Rights and Advance Subscription Rights” above, see “— Special Meetings of Shareholders,” “— Election of Directors; Staggered Terms of Directors,” “— Removal of Directors,” “— Amendment of Governing Documents”, “— Director Nominations; Proposals of Shareholders”, “— Voting Rights” and “Transfer and Registration of Ownership of Shares” below.
Bunge-Switzerland: Bunge-Switzerland does not have a shareholder rights plan. Rights plans generally discriminate in the treatment of shareholders by imposing restrictions on any shareholder who exceeds a level of ownership interest without the approval of the Board of Directors. Anti-takeover measures such as rights plans that are implemented by the Board of Directors would be restricted under Swiss corporate law by the principle of equal treatment of shareholders and the general rule that new shares may only be issued based on a shareholders’ resolution. However, upon completion of the Redomestication, Bunge-Switzerland’s articles of association will include a capital band provision, according to which the Board of Directors is authorized, at any time during a five-year period, to limit or withdraw the subscription rights of the existing shareholders in various circumstances, including (1) following a shareholder or a group of shareholders acting in concert having accumulated shareholdings in excess of 15% of the share capital registered in the commercial register without having submitted to all other shareholders a takeover offer recommended by the Board of Directors; or (2) for the defense of an actual, threatened or potential takeover offer that the Board of Directors, upon consultation with an independent financial adviser retained by it, has not recommended or will not recommend to the shareholders to accept on the basis that the Board of Directors does not find such takeover bid to be financially fair to the shareholders.
For other provisions that could be considered to have an anti-takeover effect, in addition to “—Subscription Rights and Advance Subscription Rights” and “—Special Vote Required for Combinations with Interested Shareholders” above, see “—Special Meetings of Shareholders,” “—Board and Committee Composition; Management,” “—Election of Directors; Staggered Terms of Directors,” “—Removal of Directors,” “—Amendment of Governing Documents” and “—Director Nominations; Proposals of Shareholders” below.
Appraisal Rights and Compulsory Acquisitions
Bunge-Bermuda: Under the Companies Act, a dissenting shareholder of a company participating in an amalgamation or merger (other than an amalgamation or merger between a company and its wholly-owned subsidiary or between two or more subsidiaries of the same holding company) may, within one month of the notice of a shareholders’ meeting to approve such amalgamation or merger, apply to the Bermuda Court to appraise the fair value of his or her shares. In connection with the compulsory transfer of shares to a 90% shareholder of a Bermuda company as described under “— Shareholder Approval of Business Combinations,” a minority shareholder may, within one month of notice of such 90% shareholder approval, apply to the Bermuda Court objecting to that transfer. In connection with the compulsory transfer of shares to a 95% shareholder of a Bermuda company, a minority shareholder may, within one month of receiving notice of the compulsory transfer, apply to the Bermuda Court to appraise the value of his or her shares.
Bunge-Switzerland: For business combinations effected in the form of a statutory merger or demerger and subject to Swiss law, the Merger Act provides that if the equity rights have not been adequately preserved or compensation payments in the transaction are unreasonable, a shareholder may request a competent court to determine a reasonable amount of compensation.
Election of Directors
Bunge-Bermuda: Bunge-Bermuda’s bye-laws provide that the number of directors of Bunge-Bermuda shall not be less than 7 nor more than 15. The board has the exclusive power to set the exact number of directors within that range, by the affirmative vote of at least 66% of the directors then in office. The board currently has 11 directors. The Companies Act does not contain provisions specifically related to classified boards of directors.
Bunge-Bermuda’s bye-laws provide that directors may be elected at a general meeting by a plurality of the votes cast by the shareholders present in person or by proxy at the meeting.
Bunge-Switzerland: Bunge-Switzerland's articles of association provide that the number of directors of Bunge-Switzerland shall be not less than 7 or more than 15. Within that range, Bunge-Switzerland's Board of Directors has the authority to propose nominees for election by the general meeting of shareholders. Bunge-Switzerland’s articles of association provide that the general meeting of shareholders has the inalienable power to elect the members of the Board of Directors, along with the chair of the Board of Directors. Each director is elected individually and holds a
term of office until the completion of the next annual general meeting. Re-election is possible. If the annual general meeting is held later than six months after the end of the financial year, the term of office shall nevertheless continue until completion of the next annual general meeting. Bunge-Switzerland’s articles of association provide that directors are elected at a general meeting of shareholders by the majority of the votes cast at the general meeting (whereby abstentions, broker nonvotes, blank or invalid ballots shall be disregarded for purposes of establishing the majority). In an election in which the number of candidates exceeds the number of the respective positions that are on the agenda at the general meeting of shareholders, the candidates shall be elected by a plurality of the votes cast at the general meeting of shareholders, such that the candidates receiving the most affirmative votes (up to the number of candidates to be elected) shall be elected and a majority of the votes cast shall not be a prerequisite to the election. In the event of a tie, the acting chair shall have the casting vote.
Under the Swiss Code, board members may at any time, with or without cause and with immediate effect, resign from office.
Bunge-Switzerland's articles of association provide that directors may not hold more than ten (10) additional mandates of which no more than four (4) may be in listed companies.
Vacancies on Board of Directors
Bunge-Bermuda: Bunge-Bermuda’s bye-laws provide that the board shall have the power to appoint a director to fill a vacancy on the board. Bunge-Bermuda’s bye-laws provide that the board shall have the power to appoint persons to fill newly created directorships, provided that any such appointment shall require the affirmative vote of at least 66% of the directors then in office.
Bunge-Switzerland: The Swiss Code provides that a vacancy or a newly created directorship as proposed by Bunge-Switzerland’s Board of Directors may only be filled upon approval by shareholders at a general meeting.
Bunge-Switzerland’s articles of association provide that if the office of the chair of the Board of Directors is vacant, the Board of Directors shall appoint a new chair from among its members for a term of office extending until completion of the next annual general meeting.
Removal of Directors
Bunge-Bermuda: Bunge-Bermuda’s bye-laws provide that directors may be removed for “cause,” and without cause. In either case, removal of a director requires the affirmative vote of a majority of the shareholders present in person or represented by proxy at a general meeting, provided that notice for any meeting convened for the purpose of removing a director shall contain a statement of the intention to do so and be served on such director not less than 14 days before the meeting, and at such meeting such director shall be entitled to be heard on the motion for such director’s removal.
Bunge-Switzerland: Under the Swiss Code, directors may at any time, with or without cause, be removed from office by resolution of the shareholders at a general meeting of shareholders, provided that a proposal for such resolution has been put on the agenda for the meeting in accordance with the requirements of the Swiss Code and Bunge-Switzerland’s articles of association.
Board and Committee Composition
Bunge-Bermuda: Bunge-Bermuda’s bye-laws stipulate the following with respect to the composition of its Board of Directors and its committees:
•the shareholders elect the members of Bunge-Bermuda's Board of Directors at the general meeting; and
•Bunge-Bermuda's Board of Directors shall determine its own chairman and committee composition.
Bunge-Switzerland: Bunge-Switzerland's articles of association stipulate the following with respect to the composition of its Board of Directors and its committees:
•the shareholders elect the members of Bunge-Switzerland's Board of Directors, the chair of Bunge-Switzerland's Board of Directors and the members of the compensation committee individually at the general meeting; and
•except for the election of the chair of Bunge-Switzerland's Board of Directors and the members of the compensation committee by the shareholders at the general meeting, Bunge-Switzerland's shall determine its own organization.
Duties of the Board of Directors
Bunge-Bermuda: The Companies Act includes a statutory duty of care, requiring directors to act honestly and in good faith with a view to the best interests of the company and to exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. In addition to the statutory duty of care, judicial precedent in Bermuda has defined the duties of a director as being the exercise of reasonable skill, care and diligence, to take actions in the bona fide best interests of the company, to exercise powers for proper purposes and to observe general standards of loyalty, good faith, and the avoidance of a conflict of duty and self-interest. In the absence of a developed body of Bermuda law in this regard, the principles outlined by English common law are highly persuasive in Bermuda courts. The standard of skill and care expected of a director of a Bermuda company may be summarized as follows.
Historically, the standard of care expected of directors in Bermuda was entirely subjective. In recent years the English and Commonwealth common law authorities have moved towards an objective test for the standard of skill and care that should be exercised by directors. It is likely that Bermuda courts will follow these authorities. In consequence, it is probable that the standard of care required to be met by the director of a Bermuda company is that of a reasonably diligent person having both (1) the general knowledge, skill and experience that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to that company, and (2) the specific knowledge, skill and experience that such director actually has. In consequence, there is a minimum objective standard based upon the functions given to the director in question but the standard may be raised where the director in question has more knowledge, skill and experience than would normally be expected. In addition, and based on a growing body of judicial precedent in England and the Commonwealth, the responsibilities of directors require that they take reasonable steps to place themselves in a position to guide and monitor the management of the company without relying blindly on the judgment of others. The foregoing notwithstanding, the duty of care is not absolute and it is still proper for directors to delegate management functions, especially in large companies such as Bunge-Bermuda.
Under the Companies Act, a director must observe the statutory duty of care, which requires such director to act honestly and in good faith with a view to the best interests of the company and to exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. Directors are also subject to common law fiduciary duties which require directors to act in good faith and in the best interests of the company and to exercise the powers and fulfill the duties of the office honestly and within the powers set forth in the company’s memorandum and bye-laws. Further, directors must not put themselves in a position of conflict with the company.
Bunge-Switzerland: A director of a Swiss company is bound to performance standards as specified in the Swiss Code. Under these standards, a director must act in accordance with the duties imposed by statutory law, in accordance with the company’s articles of association and in the best interest of the company. A director is generally disqualified from participating in a decision that directly affects him or her. A director must generally safeguard the interest of the company in good faith, adhere to a duty of loyalty and a duty of care and, absent special circumstances, extend equal treatment to all shareholders in like circumstances. The members of the Board of Directors of Bunge-Switzerland are liable to Bunge-Switzerland, its shareholders and, in bankruptcy, its creditors for damage caused by the violation of their duties. So long as the majority of the Board of Directors is disinterested and acts on an informed basis and with the belief that its actions are in the best interest of the company, a decision made by the Board of Directors would be protected by a judicially developed business judgment rule (based on which courts exercise restraint in reviewing business decisions of a company's Board of Directors); at least as long as no special statutory duties of the Board of Directors are triggered, such as by the company's overall indebtedness or liquidity situation.
Pursuant to Bunge-Switzerland’s organizational regulations, the Board of Directors is entrusted with the ultimate direction of the company, including determining the principles of business strategy and the related policies, the overall supervision of the group companies and the supervision and control of the executive management team.
To the extent that the Swiss Code allows the delegation by the Board of Directors to executive management, and such delegation is actually made by virtue of Bunge-Switzerland’s organizational regulations, the responsibility of the Board of Directors is limited to the due election, instruction and supervision of the executive management.
Indemnification of Directors and Officers; Insurance
Bunge-Bermuda: Under the Companies Act, a company may exempt its directors and officers, or indemnify them in respect of, any loss arising or liability attaching to them by virtue of any rule of law in respect of any negligence, default, breach of duty or breach of trust, except in cases where such liability arises from fraud or dishonesty of which such director or officer may be guilty in relation to the company or any of its group companies.
The bye-laws of Bunge-Bermuda provide that Bunge-Bermuda shall indemnify its officers and directors in respect of their actions and omissions, except in respect of their fraud or dishonesty. Bunge-Bermuda has entered into indemnification agreements with its directors and executive officers that provide for indemnification and expense reimbursement to the fullest extent permitted by law.
The Companies Act permits a company to purchase and maintain insurance for the benefit of any officer or director in respect of any loss or liability attaching to him in respect of any negligence, default, breach of duty or breach of trust, whether or not the company may otherwise indemnify such officer or director. Bunge-Bermuda has purchased and maintains a directors’ and officers’ liability policy for such a purpose.
Bunge-Switzerland: We believe, based on the interpretation of leading Swiss legal scholars, that, under Swiss law, the company may indemnify its directors and officers unless the indemnification results from a breach of their duties that constitutes gross negligence or intentional breach of duty of the director or officer concerned. Bunge-Switzerland’s articles of association make indemnification of directors and officers and advancement of expenses to defend claims against directors and officers mandatory on the part of Bunge-Switzerland to the fullest extent allowed by law. Under Bunge-Switzerland’s articles of association, a director or officer may not be indemnified if such person is found, in a final judgment or decree not subject to appeal, to have committed an intentional or grossly negligent breach of his or her statutory duties as a director or officer. Swiss law permits the company, or each director or officer individually, to purchase and maintain insurance on behalf of such directors and officers. Bunge-Switzerland may obtain such insurance from one or more third party insurers or captive insurance companies. Bunge-Switzerland also plans to enter into indemnification agreements with each of its directors and executive officers, upon the completion of the redemption, that will provide for indemnification and expense advancement and include related provisions meant to facilitate the indemnitee’s receipt of such benefits. The agreements provide that Bunge-Switzerland will indemnify each such director and executive officer if such director or executive officer acted in good faith and reasonably believed he was acting in the best interest of Bunge-Switzerland and, in addition, with respect to any criminal proceeding, he had no reasonable cause to believe that his conduct was unlawful. The agreements provide that expense advancement is provided subject to an undertaking by the indemnitee to repay amounts advanced if it is ultimately determined that he is not entitled to indemnification. The disinterested members of the Board of Directors of Bunge-Switzerland or an independent counsel will determine whether indemnification payment should be made in any particular instance. In making such determination, the board or the independent counsel, as the case may be, must presume that the indemnitee is entitled to such indemnification, and Bunge-Switzerland has the burden of proof in seeking to overcome such presumption. If the board or the independent counsel determines that the director or executive officer is not entitled to indemnification, the agreements provide that such person is entitled to seek an award in arbitration with respect to his right to indemnification under his agreement.
Limitation on Director Liability
Bunge-Bermuda: Under the Companies Act, a company may indemnify its directors against any liability which by virtue of any rule of law would otherwise be imposed on them in respect of any negligence, default, breach of duty or breach of trust, except in cases where such liability arises from fraud or dishonesty of which such director may be guilty in relation to the company or any of its group companies.
The Companies Act renders void any provision in the bye-laws or any contract between a company and any such director exempting him or her from or indemnifying him or her against any liability in respect of any fraud or dishonesty of which he or she may be guilty in relation to the company. Further, a Bermuda court may not enforce a provision purporting to limit a director’s liability if to do so was contrary to public policy, such as, if the provision attempted to relieve a director of criminal liability. The Bunge-Bermuda bye-laws provide that the shareholders waive all claims or rights of action that they might have, individually or by or in the right of Bunge-Bermuda, against any of Bunge-Bermuda’s directors or officers for any action taken or failure to act in the performance of such director’s or officer’s duties, except in respect of any fraud or dishonesty of such director or officer.
Bunge-Switzerland: Swiss law does not permit a company to exempt any member of its Board of Directors from any liability for damages suffered by the company, the shareholders or the company’s creditors caused by intentional or negligent violation of that director’s duties. However, the general meeting of shareholders may pass a resolution discharging the members of the Board of Directors from liability for certain limited actions. Such release is effective only for facts that have been disclosed to the shareholders and only vis-à-vis the company and those shareholders who have consented to the resolution or who acquired shares subsequently with knowledge of the resolution.
Directors’ Conflicts of Interest
Bunge-Bermuda: As a matter of the common law applied in Bermuda, the director of a Bermuda company should seek to avoid placing himself in a position where there is a conflict, or a possible conflict, between the duties he owes to the company and either his personal interest or other duties that he owes to a third party, and if a director is in any way, directly or indirectly, interested in a proposed transaction or arrangement with the company, he must declare the nature and extent of that interest to the other directors at the first opportunity. The duty extends to not making personal profit from opportunities that result from directorship.
This common law duty of a director to avoid conflicts of interest generally is not breached in respect of matters that have been declared by the director at the appropriate time and (i) authorized by the directors generally or (ii) authorized by the provisions of the company’s memorandum of association and bye-laws. Bunge-Bermuda’s bye-laws provide that a director who is directly or indirectly interested in a contract or proposed contract or arrangement with the company shall declare the nature of such interest as required by the Companies Act and, following a declaration being made pursuant to the bye-laws, and unless disqualified by a majority of the board present at the relevant board meeting, a director may vote in respect of any contract or proposed contract or arrangement in which such director is interested and may be counted in the quorum at such meeting.
Bunge-Switzerland: Under the Swiss Code, a director is required to safeguard the interests of the company and to adhere to a duty of loyalty and a duty of care. The Swiss Code expressly requires members of the Board of Directors to inform each other immediately and fully of any conflicts of interest affecting them. It is then the responsibility of the Board of Directors to take the measures necessary to safeguard the interests of the company. Generally, a material conflict of interest disqualifies that director from participating in any board discussions and decisions affecting his or her interest. Breach of these principles may also entail personal liability of the directors to the company. In addition, the Swiss Code requires a director to return to the company payments made to a director if such payments are not made on an arm’s length basis or if the recipient of the payment was acting in bad faith.
Bunge-Switzerland's Board of Directors has a written policy with respect to related person transactions pursuant to which such transactions are reviewed, approved or ratified.
Shareholders’ Suits
Bunge-Bermuda: Under Bermuda law, a court will generally refuse to interfere with the management of a company on behalf of minority shareholders who are dissatisfied with the conduct of a company’s affairs by its Board of Directors. However, each shareholder is entitled to have the affairs of the company properly conducted in accordance with law. Therefore, if those who control the company persistently disregard the requirements of law or of the company’s memorandum of association or bye-laws, the court may grant relief. Bermuda courts ordinarily would be expected to follow English precedent, which would permit the court to intervene in any of the following circumstances: (i) where the act complained of is alleged to be beyond the corporate power of the company or illegal; (ii) where the act complained of is alleged to constitute a fraud against the minority shareholders by those controlling the company; provided that the majority shareholders have used their controlling position to prevent the company from taking action against the wrongdoers; (iii) where an act requires approval by a greater percentage of the company’s shareholders than actually approved it; or (iv) where such an action is necessary in order that there not be a violation of the company’s memorandum of association or bye-laws.
Under the Companies Act, a shareholder is entitled to complain to the court that the affairs of the company are being conducted in a manner which is oppressive or unfairly prejudicial to the shareholders, or some of them, and seek a winding-up of the company or an alternative remedy.
An individual shareholder may seek to bring an action on behalf of the company to enforce the company’s rights, and judgment in such a case would be in favor of the company.
An individual shareholder may be permitted to bring an action on behalf of himself and his fellow shareholders to remedy a wrong done to the company or to compel the company to conduct its affairs in accordance with the rules governing it.
A shareholder also may be permitted to bring an action in his own name on his own behalf against a Bermuda company or another shareholder. In any such action, however, a loss suffered by the company will not be regarded as a direct loss suffered by the individual shareholder. Remedies for such an action are generally limited to declarations or injunctions.
Bunge-Switzerland: Under Swiss law, each shareholder is entitled to file an action for damage caused to the company. The general meeting may resolve that the company shall bring the action and entrust the Board of Directors or a representative thereof with the conduct of the proceedings. The claim of the shareholder is for performance to the company. If the shareholder, based upon the factual and legal situation, had sufficient cause to file an action, the judge has discretion to impose all costs the plaintiff incurred in prosecuting the action on the company.
Shareholders who suffer a direct loss due to an intentional or negligent breach of a director’s or senior officer’s duties may sue in their personal capacity for monetary compensation.
In addition, under the Swiss Code, each shareholder may petition the competent Swiss court to have a decision of the general meeting of shareholders declared invalid on the grounds that the decision violates the company's articles of association or the law.
Shareholder Consent to Action Without Meeting
Bunge-Bermuda: The Companies Act provides that anything which may be done by resolution of a company at a general meeting or a meeting of any class of members may also be done by resolution in writing. Bunge-Bermuda’s bye-laws require unanimous written consent, meaning that a resolution in writing be signed by or on behalf of all members who at the date of the resolution would be entitled to attend a general meeting and vote on the resolution. Bunge-Bermuda’s bye-laws prohibit resolutions in writing (i) to remove the auditor pursuant to section 89(5) of the Companies Act and (ii) to remove a director before the expiration of their term of office.
Bunge-Switzerland: Bunge-Switzerland's articles of association provide that shareholders are not permitted to act by written consent in lieu of a general meeting of shareholders.
Annual Meetings of Shareholders
Bunge-Bermuda: The Companies Act and Bunge-Bermuda’s bye-laws require that a general meeting of shareholders be held at least annually. Bunge-Bermuda’s bye-laws provide that the annual meeting can be held at any location as specified in the notice of the meeting. At such meeting, elections will be held for directors whose terms have expired and such other business may be transacted as may properly be brought before such meeting. The shareholders are also required to appoint an auditor at the annual general meeting (or, if necessary, at a subsequent special general meeting). In addition, the Companies Act and Bunge-Bermuda’s bye-laws require, subject to waiver by all of the members and directors of Bunge-Bermuda, that the financial statements required by the Companies Act be laid before Bunge-Bermuda at the general meeting.
Bunge-Switzerland: Under the Swiss Code and Bunge-Switzerland’s articles of association, Bunge-Switzerland must hold an annual, ordinary general meeting of shareholders within six months after the end of its fiscal year for the purpose, among other things, of approving the annual (standalone and consolidated) financial statements and the annual report, annually electing the chair of the Board of Directors and the directors, the members of the compensation committee, and annually approving the maximum aggregate compensation payable to the Board of Directors and the members of the executive management team. The invitation to general meetings must be published in the Swiss Official Gazette of Commerce at least 20 calendar days prior to the relevant general meeting of shareholders. The notice of a meeting must state the items on the agenda and the proposals of the Board of Directors and the shareholders who requested that a meeting be held and/or an item be put on the agenda and, in case of elections, the name of the nominees. No resolutions may be passed at a shareholders' meeting concerning agenda items for which proper notice was not given. This does not apply, however, to proposals made during a shareholders' meeting to convene an extraordinary meeting or to initiate a special investigation. No previous notification will be required for proposals concerning items included on the agenda or for debates as to which no vote is taken.
In addition to being required to comply with the notice provisions under the Swiss Code, Bunge-Switzerland is subject to the rules of the SEC that regulate the solicitation of proxies. Bunge-Switzerland is required to file with the SEC its proxy statement related to a general meeting of the shareholders, together with a form of proxy card used by Bunge-Switzerland and certain other soliciting material furnished to Bunge-Switzerland's shareholders in connection with such meeting.
Annual general meetings of shareholders may be convened by the Board of Directors or, under certain circumstances, by the auditor. A general meeting of shareholders can be held in Switzerland or abroad.
Special Meetings of Shareholders
Bunge-Bermuda: The Companies Act and Bunge-Bermuda’s bye-laws provide that a special general meeting of Bunge-Bermuda may be called by the chairman or any two directors or any director and the secretary or the Board of Directors as a whole. In addition, the Board of Directors must convene a special general meeting upon request by one or more shareholders holding at least one-tenth of the Bunge-Bermuda shares having the right to vote at general meetings of Bunge-Bermuda at the time of the request.
Bunge-Switzerland: An extraordinary general meeting of Bunge-Switzerland may be called upon the resolution of the Board of Directors or, under certain circumstances, by the auditor. In addition, the Board of Directors is required to convene an extraordinary general meeting of shareholders if so resolved by the general meeting of shareholders, or if so requested by shareholders holding an aggregate of at least 5% of the registered shares, specifying the items for the agenda and their proposals. If the Board of Directors does not comply with the request to publish the notice of the extraordinary general meeting within a reasonable period of time, but at the latest within 60 days, the requesting shareholders may request the competent court to order that the meeting be convened.
Shareholders who hold, alone or together, at least 0.5 percent of the share capital or votes and are insofar recorded in the share register may request that an item be included on the agenda of a general meeting of shareholders. See “—Director Nominations; Proposals of Shareholders” for more information.
Record Dates for Shareholder Meetings
Bunge-Bermuda: Bunge-Bermuda’s bye-laws provide that the Board of Directors may fix any date as the record date for determining the shareholders entitled to receive notice of and to vote at any general meeting.
Bunge-Switzerland: Bunge-Switzerland expects to set the record date for each general meeting of shareholders on a date not more than 20 calendar days prior to the date of each general meeting and announce the date of the general meeting of shareholders prior to the record date.
Director Nominations; Proposals of Shareholders
Bunge-Bermuda: Bunge-Bermuda’s bye-laws permit shareholder proposals to be brought before a general meeting. Notice of any such proposal must be given in writing to the secretary of Bunge-Bermuda by any member of Bunge-Bermuda on the date of such notice: (i) for consideration at an annual general meeting, not later than 120 days before the first anniversary of the date on which our proxy statement was distributed to shareholders in connection with the previousprior year's annual general meeting. If no annual general meeting was held in the prior year or if the date of the annual general meeting has been changed by more than 30 days from the date contemplated in the prior year's proxy statement, was circulated;the notice must be given before the later of (i) 150 days prior to the contemplated date of the annual general meeting and (ii) the date which is 10 days after the date of the first public announcement or (ii) for considerationother notification of the actual date of the annual general meeting. Where directors are to be elected at a special general meeting, prior tosuch notice must be given before the later of (x)(i) 120 days before the date of the special general meeting and (y)(ii) the date which is 10 days after the date of the first public announcement or noticeother notification of the special general meeting.
Bunge-Bermuda’s bye-laws require that a shareholder desiring to nominate directors for consideration by the shareholders at any annual general meeting must give written notice of such intent, which notice must be given to the secretary of Bunge-Bermuda not later than 120 days before the first anniversary of the date on which the previous annual general meeting proxy statement was circulated. Notice of any nomination of a person for election as a director at a special general meeting must be given in writing to the secretary of Bunge-Bermuda prior to the later of 120 days before the date of the special general meeting andmeeting. In each case, the datenotice must include, as to each person the shareholder proposes to nominate for election or re-election as director, all information relating to that person required to be disclosed in solicitations of proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, which is 10 days afterwe refer to as the first public announcement or notice of the special general meeting.
Bunge-Switzerland: Under Bunge-Switzerland’s articles of association, shareholders who hold, alone or together, at least 0.5 percent of the share capital or votes and are insofar recordedExchange Act, which includes such person's written consent to being named in the share registerproxy statement as a nominee and to serving as a director if elected, and evidence satisfactory to us that such nominee has no interests that would limit such nominee's ability to fulfill their duties of office. We may request that an itemrequire any nominee to furnish such other information as reasonably may be included onrequired by us to determine the agendaeligibility of such nominee to serve as a general meeting of shareholders. Suchdirector. A shareholder may also nominate one or more directors for election. A request for inclusion of an item on the agenda mustpropose a director nominee to be in writing and receivedconsidered by Bunge-Switzerlandour shareholders at least 120 but not more than 150 calendar days prior to the meeting. To nominate a nominee, the shareholder must, no earlier than 150 calendar days and no later than 120 calendar days prior to the first anniversary of the date (as stated in the Bunge-Switzerland proxy materials) on which the Bunge-Switzerland definitive proxy statement for the prior year’s annual general meeting was first released to Bunge-Switzerland’s shareholders, deliver a notice to, and such notice must be received by, Bunge-Switzerland at its registered office; provided, however, that if the annual general meeting provided that the notice provisions in our bye-laws as set forth above are met, even if such director nominee is not scheduled to be held within a period beginning 30 days before such anniversary date and ending 30 days after such anniversary date, the notice shall be given in the manner provided hereinnominated by the later of the close of business on the date that is 180 days prior to such other meeting date or the tenth day following the date that Bunge-Switzerland first makes public disclosure regarding such other meeting date. The request must specify theCorporate Governance and Nominations Committee. A shareholder may also recommend director candidates for consideration
5817 Bunge | 2023 Proxy Statement
relevant agenda items and proposals, together with evidence of the required shares recorded in the share register, as well as any other information as would be required to be included in a proxy statement pursuant to the rules of the SEC.
Adjournment of Shareholder Meetings
Bunge-Bermuda: Bunge-Bermuda’s bye-laws provide that the chairman of any shareholder meeting may, with the consent of a majority of the shareholders present and entitled to vote at the meeting, adjourn the meeting. New notice of the date, time, and place for the resumption of the meeting must be given if the meeting is not adjourned to a specific date and time.
Bunge-Switzerland: Under the Swiss Code, a general meeting of shareholders for which a notice of meeting has been duly published may not be adjourned without publishing a new notice of meeting.
Voting Rights
Bunge-Bermuda: The holders of common shares of Bunge-Bermuda are entitled to one vote per share. Any matter submitted to shareholders at a general meeting requires the affirmative vote of a majority of the votes cast unless otherwise required by the Companies Act or the bye-laws. Bunge-Bermuda’s bye-laws provide thatCorporate Governance and Nominations Committee at any matter submitted to the shareholders at a general meeting for approval requires the approval of a majority of the votes cast (other than in the election of directors and as set forth below).
The rights attached to any separate class or series of shares, unless otherwise provided by the terms of the shares of that class or series, may be varied only with the consent in writing of the holders of all of the outstanding shares of that class or series or by a resolution passed at a separate general meeting of holders of shares equal to 75% of the issued and outstanding shares of that class or series. The necessary quorum for that meeting is the presence of at least two persons, in person or by proxy, of holders of at least one-third of the shares of that class or series. Each holder of shares of the class or series present, in person or by proxy, will have one vote for each share of the class or series of which he is the holder. Outstanding shares will not be deemed to be varied by the creation or issuance of additional shares that rank in any respect prior to or equivalent with those shares.
Under the Companies Act and the Bunge-Bermuda bye-laws, any merger, amalgamation or other business combination not approved by the board must be approved by the Board of Directors and by a resolution of the members including the affirmative votes of a majority of the votes cast.
Bunge-Switzerland: Each Bunge-Switzerland registered share carries one vote at a general meeting of shareholders. Voting rights may be exercised by shareholders registered in Bunge-Switzerland’s share register, through the independent voting rights representative elected by shareholders at each annual general meeting, their legal representative or, on the basis of a written proxy, by any other representative who need not be a shareholder.
Shareholders wishing to exercise their voting rights who hold their shares through a broker, bank or other nomineetime. Any such recommendations should follow the instructions provided by such broker, bank or other nominee or, absent instructions, contact such broker, bank or other nominee for instructions. Shareholders holding their shares through a broker, bank or other nominee will not automatically be registered in Bunge-Switzerland's share register. If any such shareholder wishes to be registered in Bunge-Switzerland's share register, such shareholder should contact the broker, bank or other nominee through which it holds Bunge-Switzerland shares.
Bunge-Switzerland’s articles of association do not limit the number of registered shares that may be voted by a single shareholder.
Treasury shares, whether owned by Bunge-Switzerland or one of Bunge-Switzerland’s controlled subsidiaries, will not be entitled to vote at general meetings of shareholders.
Pursuant to the Swiss Code, shareholders have the exclusive right to determine the following matters:
•adoption and amendment of Bunge-Switzerland’s articles of association;
•election of members of the board of directors, its chair, the members of the compensation committee, the independent voting rights representative, and the statutory auditor;
•approval of the annual business report, the stand-alone statutory financial statements and the consolidated financial statements;
•approval on the allocation of profit shown on the balance sheet contained in the stand-alone statutory financial statements of the company, in particular the determination of dividend and other capital distributions to shareholders (including by way of repayment of statutory capital reserve (such as in the form of qualifying capital contribution reserves);
•discharge of the members of the board of directors from liability for previous business conduct to the extent such conduct is known to the shareholders; and
•the approval of the compensation of the board of directors and the executive management team pursuant to the articles of association, and the advisory vote on the report (established under Swiss law) pertaining to the compensation of the company's board of directors and executive management in the prior fiscal year;
•the delisting of Bunge-Switzerland equity securities;
•the approval of the report on non-financial matters pursuant to article 964c CO; and
•any other resolutions that are submitted to a general meeting of shareholders pursuant to law, Bunge-Switzerland’s articles of association or by voluntary submission by the board of directors (unless a matter is within the exclusive competence of the board of directors pursuant to the Swiss Code).
Pursuant to Bunge-Switzerland’s articles of association, the shareholders generally pass resolutions by the affirmative vote of a majority of the votes cast at the meeting (broker nonvotes, abstentions and blank and invalid ballots will be disregarded), unless otherwise provided by law or Bunge-Switzerland’s articles of association. In an election in which the number of candidates exceeds the number of the respective positions that are on the agenda at the general meeting, the candidates are elected by a plurality of the votes cast at the general meeting, such that the candidates receiving the most affirmative votes (up to the number of candidates to be elected) are elected and a majority votes cast shall not be a prerequisite to the election.
In addition, the NYSE requires a shareholder vote for certain matters such as:
•the approval of equity compensation plans (or certain amendments to such plans);
•the issuance of shares equal to or in excess of 20% of the voting power of the shares outstanding before the issuance of such shares (subject to certain exceptions, such as public offerings for cash and certain bona fide private placements);
•certain issuances of shares to related parties; and
•issuances of shares that would result in a change of control.
For these types of matters, the minimum vote which will constitute shareholder approval for NYSE listing purposes is the approval by a majority of the votes cast, provided that the total vote cast on the proposal represents over 50% in interest of all securities entitled to vote on the proposal.
The Swiss Code requires the affirmative vote of at least two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at a general meeting to approve the following matters:
•the amendment to or the modification of the purpose of Bunge-Switzerland;
•the combination of shares listed on a stock exchange;
•an increase in share capital through the conversion of equity surplus, against contributions in kind or by way of set-off with a receivable and the granting of special privileges;
•the limitation or withdrawal of subscription rights;
•the introduction of conditional share capital or the introduction of a capital band;
•the restriction of the transferability of registered shares and the cancellation of such a restriction;
•the introduction of shares with privileged voting rights;
•the change of currency of the share capital;
•the introduction of the casting vote of the acting chair in the general meeting;
•the delisting of Bunge-Switzerland’s equity securities;
•the relocation of the place of incorporation of Bunge-Switzerland;
•the introduction of an arbitration provision in the articles of association; and
•the dissolution of Bunge-Switzerland.
The same supermajority voting requirements apply to resolutions in relation to transactions among corporations based on the Merger Act, including a merger, demerger or conversion of a corporation (other than a cash-out or certain squeeze-out mergers, in which minority shareholders of the company being acquired may be compensated in a form other than through shares of the acquiring company, for instance, through cash or securities of a parent company of the acquiring company or of another company—in such a merger, an affirmative vote of 90% of the outstanding registered shares is required). Swiss law may also impose this supermajority voting requirement in connection with the sale of “all or substantially all of its assets” by Bunge-Switzerland. See “—Compulsory Acquisitions; Appraisal Rights” and “—Shareholder Approval of Business Combinations.”
Amendment of Governing Documents
Bunge-Bermuda: Bermuda law provides that the memorandum of association and bye-laws of a company may be amended by a resolution passed at a general meeting of shareholders of which due notice has been given. Bunge-Bermuda bye-laws provide that no bye-law shall be rescinded, altered or amended, and no new bye-law shall be made, unless it shall have been approved by a resolution of the Board of Directors and by a resolution of the shareholders. In the case of the bye-laws relating to the number and tenure of directors, approval of business combinations and amendment of bye-laws, the required resolutions must include the affirmative vote of at least 66% of directors then in office and by a resolution of the members including the affirmative votes of a majority of the votes cast.
Under Bermuda law, the holders of an aggregate of not less than 20% in par value of Bunge-Bermuda’s issued and outstanding share capital or any class thereof have the right to apply to the Bermuda Court for an annulment of any amendment of the memorandum of association adopted by shareholders at any general meeting, other than an amendment which alters or reduces Bunge-Bermuda’s share capital as provided in sections 45 and 46 of the Companies Act. Where such an application is made, the amendment becomes effective only to the extent that it is confirmed by the Bermuda Court. An application for an annulment of an amendment of the memorandum of association must be made within 21 days after the date on which the resolution altering Bunge-Bermuda’s memorandum of association is passed and may be made on behalf of persons entitled to make the application by one or more of their number as they may appoint in writing for the purpose. No application may be made by shareholders that voted in favor of the amendment.
Bunge-Switzerland: Under the Swiss Code and Bunge-Switzerland’s articles of association, Bunge-Switzerland’s articles of association may only be amended by a resolution of its shareholders at a general meeting. See “—Voting Rights.” Other than on the basis of an authorization of the general meeting of shareholders, Bunge-Switzerland’s Board of Directors may not effect amendments to Bunge-Switzerland’s articles of association on its own. Under Bunge-Switzerland’s articles of association, the Board of Directors may pass and amend organizational regulations. Under Swiss law, shareholders may not pass or amend organizational regulations but may pass resolutions amending the articles of association to effectively supersede provisions in the organizational regulations.
Quorum Requirements
Bunge-Bermuda: The presence at the start of the meeting of at least two persons representing, in person or by proxy, more than one-half of the issued and outstanding Bunge-Bermuda common shares constitutes a quorum for the transaction of business except as otherwise provided by the Companies Act.
Bunge-Switzerland: The presence of shareholders, in person or by proxy, holding at least a majority of the registered shares recorded in Bunge-Switzerland’s share register and generally entitled to vote at a meeting, is a quorum for the transaction of business. The Board of Directors has no authority to waive the quorum requirements stipulated in the articles of association.
Say on Pay
Bunge-Bermuda: Bunge-Bermuda is required to hold non-binding shareholder advisory votes on executive compensation required by SEC rules. Bunge-Bermuda holds these advisory votes on an annual basis.
Bunge-Switzerland: Bunge-Switzerland is required to hold non-binding shareholder advisory votes on executive compensation required by SEC rules. Bunge-Switzerland holds these advisory votes on an annual basis. In addition, under Swiss law, Bunge-Switzerland is required to hold annual binding shareholder votes on the prospective maximum aggregate amount of compensation of each of Bunge-Switzerland's Board of Directors (for the period between annual meetings) and the executive management team (for the fiscal year commencing after the annual general meeting at which ratification is sought). Shareholders are further required to vote at each annual general meeting, on an advisory basis, on the compensation report (established under Swiss law) regarding the compensation of the members of the Board of Directors and the executive management team in the preceding fiscal year.
ESG Matters
Bunge-Bermuda: The Companies Act and Bunge-Bermuda’s bye-laws do not include ESG requirements.
Bunge-Switzerland: Bunge-Switzerland will be required to establish a report on non-financial matters covering the following matters: (1) environmental matters, in particular the CO2 goals; (2) social issues; (3) employee-related issues;(4) respect for human rights; and (5) combating corruption. The report must contain the information required to understand the business performance, the business result, the state of the undertaking and the effects of its activity on the above non-financial matters.
More particularly, the report must include: (1) a description of the business model; (2) a description of the policies adopted in relation to the matters referred to above, including the due diligence applied; (3) a presentation of the measures taken to implement these policies and an assessment of the effectiveness of these measures; (4) a description of the main risks related to the above matters and how the undertaking is dealing with these risks; in particular (a) risks that arise from the undertaking's own business operations, and (b) provided this is relevant and proportionate, risks that arise from its business relationships, products or services; and (5) the main performance indicators for the undertaking's activities in relation to the above matters.
Bunge-Switzerland's Board of Directors will be required to submit the report to shareholders for approval by the annual general meeting, for the first time in 2024 in relation to financial year 2023.
Inspection of Books and Records; Special Investigation
Bunge-Bermuda: Shareholders of a Bermuda company have the right to inspect or obtain copies of the minutes of general meetings of the company. Shareholders may also inspect the share register on any business day, subject to reasonable restrictions imposed by the Board of Directors.
Bunge-Switzerland: Under the Swiss Code, a shareholder has a right to inspect the share register with regard to its, his or her own shares and otherwise to the extent necessary to exercise its, his or her shareholder rights. No other person has a right to inspect the share register. The books and correspondence of a Swiss company may be inspected with the express authorization of the general meeting of shareholders or by resolution of the Board of Directors and subject to the safeguarding of the company’s business secrets. At a general meeting of shareholders, any shareholder is entitled to request information from the Board of Directors concerning the affairs of the company. Shareholders may also ask the auditor questions regarding its audit of the company. The Board of Directors and the auditor must answer shareholders’ questions to the extent necessary for the exercise of shareholders’ rights and subject to prevailing business secrets or other material interests of Bunge-Switzerland.
In addition, if the shareholders’ inspection and information rights as outlined above prove to be insufficient, any shareholder may propose to the general meeting of shareholders that specific facts be examined by a special commissioner in a special investigation. If the general meeting of shareholders approves the proposal, Bunge-Switzerland or any shareholder may, within three months after the general meeting of shareholders, request the court at Bunge-Switzerland’s registered office to appoint a special commissioner. If the general meeting of shareholders rejects the request, one or more registered shareholders representing at least 5% of the share capital or voting rights may request the court to appoint a special commissioner. The court will issue such an order if the petitioners can demonstrate that the Board of Directors, any member of the board or an officer of Bunge-Switzerland infringed the law or Bunge-Switzerland’s articles of association and thereby damaged the company or the shareholders. The costs of the investigation would generally be allocated to Bunge-Switzerland and only in exceptional cases to the petitioners.
Transfer and Registration of Shares
Bunge-Bermuda: Under Bunge-Bermuda’s bye-laws the directors may decline to register a transfer of a share which is not fully paid.
Bunge-Bermuda’s bye-laws expressly provide for the issuance of fractional shares which may be dealt with to the same extent as whole shares.
Bunge-Switzerland: No restrictions apply to the transfer of Bunge-Switzerland registered shares. So long as and to the extent that Bunge-Switzerland's shares are intermediated securities within the meaning of the Swiss Intermediated Securities Act, (i) any transfer of Bunge-Switzerland's shares is effected by a corresponding entry in the securities deposit account of a bank or a depository institution, (ii) no Bunge-Switzerland's shares can be transferred by way of assignment, and (iii) a security interest in any Bunge-Switzerland's share cannot be granted by way of assignment. Any person who acquires Bunge-Switzerland's shares may submit a request to Bunge-Switzerland to be entered into the share register as a shareholder with voting rights, provided such persons expressly declare that they have acquired the shares in their ownnominee's name and qualifications for their own account, that there is no agreement on the redemption of the shares and that they bear the economic risk associated with the shares. Bunge-Switzerland's Board of Directors may record nominees who hold shares in their own name, but for the account of third parties, as shareholders of record with voting rights in the share register of the Company. Beneficial owners of shares who hold shares through a nominee exercise the shareholders' rights through the intermediation of such nominee. Bunge-Switzerland’s share register will initially be kept by Computershare Inc., which acts as transfer agent and registrar. The share register reflects only record owners of Bunge-Switzerland shares. Swiss law does not recognize fractional share interests. Bunge-Bermuda has not presently issued fractional shares so no change is required for fractional shares based on Swiss law.membership.
Rights upon Liquidation
Bunge-Bermuda: Upon a liquidation of Bunge-Bermuda, after creditors have been paid the full amounts owing to them, the holders of Bunge-Bermuda’s common shares would be entitled to receive, pro rata, any remaining assets available for distribution to the holders of common shares. The liquidator may deduct from the amount payable in respect of those common shares any liabilities the holder has to or with Bunge-Bermuda. The assets received by the holders of Bunge-Bermuda common shares in liquidation may consist in whole or in part of property. That property is not required to be of the same kind for all shareholders. The shareholders may resolve that the company be wound up by the court, or be wound up voluntarily, with the vote of holders of at least 75% of the voting shares of the company. The board may also present a petition to the court for the company to be wound up.
Bunge-Switzerland: Bunge-Switzerland’s duration is unlimited. Bunge-Switzerland may be dissolved at any time with the approval of shareholders holding two-thirds of the voting rights and a majority of the par value of the registered shares, each as represented at a general meeting. Dissolution by m is possible if Bunge-Switzerland becomes bankrupt, or for cause at the request of shareholders holding at least 10% of Bunge-Switzerland’s share capital. Under Swiss law, any surplus arising out of liquidation, after the settlement of all claims of all creditors, will be distributed to shareholders in proportion to the paid-up par value of registered shares held, subject to Swiss withholding tax requirements of 35%, all or part of which can potentially be reclaimed under the relevant tax rules in Switzerland or double taxation treaties concluded between Switzerland and foreign countries. Bunge-Switzerland's shares carry no privilege with respect to such liquidation surplus.
Enforcement of Civil Liabilities Against Foreign Persons
Bunge-Bermuda: Bunge-Bermuda has been advised by its Bermuda counsel, Conyers Dill & Pearman Limited, that a judgment for the payment of money rendered by a court in the United States based on civil liability would not be automatically enforceable in Bermuda. There is no treaty between Bermuda and the United States providing for the reciprocal enforcement of foreign judgments. Bunge-Bermuda has also been advised by Conyers Dill & Pearman Limited that a final and conclusive judgment obtained in a court in the United States under which a sum of money is payable as compensatory damages may be the subject of an action in the Bermuda Court under the common law doctrine of obligation. Such an action should be successful upon proof that the sum of money is due and payable, and without having to prove the facts supporting the underlying judgment, as long as: (i) the court that gave the judgment was competent to hear the action in accordance with private international law principles as applied by the courts in Bermuda; and (ii) the judgment is not contrary to public policy in Bermuda, was not obtained by fraud or in proceedings contrary to natural justice of Bermuda and is not based on an error in Bermuda law.
Bunge-Switzerland: Swiss counsel has advised Bunge-Switzerland that it is uncertain that Swiss courts would enforce (1) judgments of U.S. courts obtained in actions against Bunge-Switzerland or other persons that are predicated upon the civil liability provisions of U.S. federal securities laws or (2) original actions brought against Bunge-Switzerland or other persons predicated upon the Securities Act. The enforceability in Switzerland of a foreign judgment rendered against Bunge-Switzerland or such other persons is subject to the limitations set forth in such international treaties by which Switzerland is bound and the Swiss Federal Private International Law Act. In particular, and without limitation to the foregoing, a judgment rendered by a foreign court may only be enforced in Switzerland if:
•such foreign court had jurisdiction,
•such judgment has become final and non-appealable,
•the court procedures leading to such judgment followed the principles of due process of law, including proper service of process, and
•such judgment does not violate Swiss law principles of public policy.
In addition, enforceability of a judgment by a non-Swiss court in Switzerland may be limited if Bunge-Switzerland can demonstrate that it or such other persons were not effectively served with process.
Board Independence
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THE SHAREHOLDERS MEETINGWith respect to the 2023 director nominees, the Board has determined that each non-employee director who served in 2022 and each non-employee director nominee is independent in accordance with the New York Stock Exchange Corporate Governance Standards and that no major relationship exists with Bunge other than as a director. |
WeRegulatory Requirements: In accordance with the listing standards of the New York Stock Exchange (NYSE), to be considered independent, a director must have no material relationship with Bunge directly or as a partner, shareholder or officer of an organization that has a relationship with Bunge. The NYSE has also established enhanced independence standards applicable to members of our Audit Committee and our Human Resources and Compensation Committee.
Independence Governance Framework: In accordance with the Corporate Governance Principles and our Policy for the Review and Approval of Related Person Transactions, the Corporate Governance and Nominations Committee assists the Board annually to review commercial and other relationships between directors and members of their immediate families and Bunge to make a determination regarding the independence of each director or director nominee. In addition, the Board has adopted categorical standards of director independence which are furnishing this proxy statementset forth in Annex A to our shareholdersCorporate Governance Principles. The categorical standards of director independence are available through the "Investors — Corporate Governance" section of our website, bunge.com. Additionally, our bye-laws provide that no more than two directors may be employed by us or any company or entity which we control.
Independence Determination: In making its independence determinations, the Board considers relevant facts and circumstances, including that in connection with the solicitation of proxies by Bunge-Bermuda’s Board of Directors for use at a meeting of Bunge-Bermuda shareholders to consider the Redomestication and any adjournment or postponement of the meeting. We are first mailing this proxy statement and accompanying form of proxy to shareholders beginning on or about [●].
Time, Place, and Date
The shareholders meeting will be held online via live webcast at [●], commencing at [●] local time, on [●].
Purpose of the Meeting
At the meeting, Bunge-Bermuda’s Board of Directors will ask the shareholders to vote to approve:
•the Redomestication, which will be effected by the Scheme of Arrangement, pursuant to which Bunge-Bermuda would merge with Bunge-MergerCo, and each issued and outstanding common share of Bunge-Bermuda would be exchanged for one share of Bunge-Switzerland and, in addition, Bunge-Switzerland would issue [●] Treasury Shares to Bunge-Bermuda for future use to satisfy Bunge-Switzerland’s obligation to deliver shares in connection with awards granted under our equity incentive plans and for such other purposes as Bunge-Switzerland's Board of Directors may determine. Bunge-Switzerland will assume Bunge-Bermuda’s existing obligation to deliver shares under such equity incentive plans, warrants or other rights.
•a motion to adjourn the meeting to a later date to solicit additional proxies if there are insufficient votes at the time of the meeting to approve the Redomestication.
•any other matters that properly come before the meeting and any adjournments or postponements of the meeting.
Bunge-Bermuda’s Board of Directors has unanimously approved the Redomestication and the adjournment proposal and unanimously recommends that you vote “FOR” both of the proposals.
Record Date; Voting Rights; Vote Required for Approval
The board has fixed the closenormal course of business, purchase and sale and other commercial and charitable transactions or relationships may occur between Bunge and other companies or organizations with which some of our directors or their immediate family members are affiliated. The Board monitors the independence of its members on [●] asan ongoing basis to assist it in making determinations of director independence. For 2022, the record date forBoard considered the shareholders meeting.
Only holders of record of Bunge-Bermuda common shares on the record date are entitled to notice offollowing transactions and to vote at the meeting or any adjournment or postponement of the meeting. You will not be the holder of record of shares that you hold in “street name.” Instead, the depository (for example, Cede & Co.) or other nominee will be the holder of record of such shares.
On the record date of the shareholders meeting, approximately [●] Bunge-Bermuda common shares were issuedrelationships and entitleddetermined them to be voted atimmaterial:
•Mses. Aleixo Lustosa, Bair, Browner and McGurk and Messrs. Heckman, Hees and Winship serve as a non-employee director, trustee or advisory board member of another company that Bunge did business with in the meeting. Each Bunge-Bermuda common share entitles the holder to one vote.ordinary course; and,
•Mr. Zenuk serves as Managing Partner of Tillridge Global Agribusiness Partners ("Tillridge"), a private equity firm. Bunge conducts business with certain portfolio companies of Tillridge. The presencehighest amount of twoannual purchase or more persons at the meeting representing in person or by proxy more than 50% of our total issuedsale transactions between Bunge and outstanding voting common shares throughout the relevant meeting will constitute a quorum. Abstentions and “broker non-votes” will be counted toward the presence of a quorum at, but will not be considered votes cast on any of the proposals brought before, the meeting. Broker non-votes are shares held by banks or brokers for which voting instructions have not been received from the beneficial owners or the persons entitled to vote those shares and for which the bank or brokerportfolio companies in 2022 was approximately $17 million. Mr. Zenuk does not have discretionary voting power under rules applicable to broker-dealers. If you own shares through a bankserve as an officer or brokerage firmemployee of any of these portfolio companies and you do not instruct your bank or broker how to vote, your bank or broker will not have discretion to vote onhas no involvement in Bunge's dealings with these companies. Additionally, these commercial relationships predated Mr. Zenuk joining our Board. The Board concluded that these transactions were arm's length and determined that Mr. Zenuk is independent.
Executive Sessions of Our Board
Our Corporate Governance Principles provide that the proposal.
Assuming the presence of a quorum, the Redomestication must be approved by the affirmative vote of holders of Bunge-Bermuda common shares representing a majority in numbernon-employee directors shall meet without management directors at regularly scheduled executive sessions and at least 75%such other times as they deem appropriate. Our Board meets in executive session without management directors present at each regularly scheduled Board meeting. Our non-employee, independent Board Chair presides over these sessions.
Certain Relationships and Related Transactions
Various policies and procedures, including our Code of the Bunge-Bermuda common shares present in person Conduct, Corporate Governance Principles, Conflict of Interest Policy, and annual questionnaires and/or certifications completed by proxy at the meeting and entitled to vote on the matter. The adjournment proposal must be approved by the affirmative vote of holders of Bunge-Bermuda common shares representing a majority of the Bunge-Bermuda shares present in person or by proxy at the meeting and entitled to vote on the matter.
Our directors and executive officers have indicated that they intend to vote their shares in favor of both of the proposals. On the record date, our directors and executive officers, require disclosure of and/or otherwise identify transactions or relationships that may constitute conflicts of interest or may require disclosure under applicable SEC rules as "related person transactions". Our Corporate Governance and their affiliates beneficially owned less than one percentNominations Committee has adopted the Policy for the Review and Approval of Related Person Transactions, which is
Bunge | 2023 Proxy Statement 18
a written policy for the review and approval of related person transactions. This policy is designed to operate in conjunction with and as a supplement to the provisions of our Code of Conduct. These transactions are also reviewed in the context of making annual independence determinations regarding directors. See "Board Independence" above for further information.
Under the policy, our legal department will review all actual and proposed related person transactions presented to or identified by it and then submit any transaction in which a related person is reasonably likely to have a direct or indirect material interest to the Corporate Governance and Nominations Committee for review and approval or ratification. In determining whether to approve or ratify a related person transaction, the Corporate Governance and Nominations Committee will consider all the available and relevant facts and circumstances, including, but not limited to, (a) whether the transaction was the product of fair dealing, (b) the terms of the issuedtransaction and outstanding Bunge-Bermuda common shares.whether similar terms would have been obtained from an arm's length transaction with a third party and (c) the availability of other sources for comparable products or services. The policy also identifies certain types of transactions that our Board has identified as not involving a direct or indirect material interest and are, therefore, not considered related person transactions for purposes of the policy. For purposes of the policy, the terms "related person" and "transaction" have the meanings contained in Item 404 of Regulation S-K.
ProxiesBoard Leadership Structure
A proxy cardOur Board does not have a requirement that the roles of CEO and Board Chair be either combined or separated. The Board believes this determination should be made based on the best interests of Bunge and its shareholders at any point in time based on the facts and circumstances then facing the Company. Demonstrating the Board's commitment to making these thoughtful and careful determinations, our Board has separated the Chair and CEO roles since 2013 and has had an independent, non-employee Board Chair since January 1, 2014. Ms. Hyle currently serves as Board Chair and ex officio member of each committee. In addition, Ms. Bair was appointed as non-employee Deputy Chair on May 5, 2021. The Board believes that its current leadership structure, led by an independent Board Chair and five fully independent committees, is being sent to each shareholder asin the best interests of the record date.Company and its shareholders at this time and demonstrates its commitment to independent oversight, which is a critical aspect of effective governance. If, you properly received a proxy card, you may grant a proxy to vote on the proposals by marking your proxy card appropriately, executing it in the space provided, dating it and returning itfuture, our CEO also serves as our Board Chair, our Corporate Governance Principles provide that our non-management directors would, on an annual basis, select an independent director to us. We may accept your proxy by any form of communication permitted by Bermuda law and Bunge-Bermuda’s articles of association. Shareholders of record who do not hold their shares through a bank, broker or nominee may grant a proxy to vote onserve as the Internet at [●] or by telephone by calling the number listed on the proxy card or voting direction form. Please have your proxy card or voting direction form in hand when calling or going online. To vote by mail, please sign, date and mail your proxy card or voting direction form in the envelope provided. If you hold your shares in the nameBoard’s lead independent director. The specific responsibilities of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee when voting your shares.lead independent director are set forth in our Corporate Governance Principles.
If you have timely submitted a properly executed proxy card or provided your voting instructions by telephone or on the Internet and clearly indicated your votes, your shares will be votedMr. Zenuk is expected to serve as indicated.
If you have timely submitted a properly executed proxy card or provided your voting instructions by telephone or on the Internet and have not clearly indicated your votes, your shares will be voted “FOR” bothBoard Chair of the proposals. If any other matters properly come beforeBoard following the meeting, the persons named in the proxy card will vote the shares represented by all properly executed proxies in accordance with their best judgment, unless authority to do soAnnual General Meeting. He has been a director since 2018 and is withheld in the proxy.
You may abstain on either or both of the proposals by marking “ABSTAIN” with respect to either or both of the proposals.
Under New York Stock Exchange rules, brokers who hold shares in street name for customers have the authority to vote on “routine” proposals when they have not received instructions from beneficial owners, but are precluded from exercising their voting discretion with respect to proposals for “non-routine” matters. Proxies submitted by brokers without instructions from customers for these non-routine matters are referred to as “broker non-votes.” The Redomestication proposal is a non-routine matteran independent director under New York Stock Exchange rules.
You may revoke your proxy at any time priorstandards. In addition to its exercise by:
•giving written notice ofMr. Zenuk’s expected role as the revocation to the Corporate Secretary of Bunge-Bermuda;
•appearing at the meeting, notifying the Corporate Secretary of Bunge-Bermuda and voting in person;
•revoking the proxy by telephone or the Internet; or
•properly completing and executing a later-dated proxy and delivering it to the Corporate Secretary of Bunge-Bermuda at or before the meeting.
Your presence without voting at the meeting will not automatically revoke your proxy, and any revocation during the meeting will not affect votes previously taken. If you hold your shares in the name of a bank, broker or other nominee, you should follow the instructions provided by your bank, broker or nominee in revoking your previously granted proxy.
If you do not appoint a proxy and you do not vote at the meeting, you will still be bound by the outcome. You are therefore strongly urged to attend and vote at the meeting in person or by proxy.
The accompanying proxy is being solicited on behalfChair of the Board, his governance responsibilities include chairing the Enterprise Risk Management Committee that supervises the quality and integrity of Directorsour risk management practices, reviews and approves our risk management policies, oversees the Enterprise Risk Management framework and reviews the scope of Bunge-Bermuda. our enterprise risks.
Mr. Zenuk serves as Managing Partner of Tillridge Global Agribusiness Partners, an agribusiness private equity firm. Previously, he was a Managing Director at NGP Energy Capital Management where he led the agribusiness investment platform and he has held many domestic and international executive leadership roles with Archer Daniels Midland Company. He has a seasoned and long-term perspective and insight into Bunge’s operations, as well as a thorough understanding of our businesses and expertise in our industry. Given his senior leadership experience and deep knowledge of global agribusiness and food and ingredients markets, along with his risk management expertise, the independent members of the Board find that he is the most appropriate choice to serve as Board Chair.
Board Meetings and Committees
The expensesBoard normally has five regularly scheduled meetings per year, and committee meetings are normally held in conjunction with Board meetings. Additionally, the Board holds virtual meetings to receive updates on our business and as circumstances may require. Our Board met 11 times in 2022 and acted by written consent three times. All directors serving on the Board as of preparing, printingDecember 31, 2022 attended at least 98% of the combined Board and mailingcommittee meetings on which they served during the proxylast fiscal year.
Our bye-laws give our Board the authority to delegate its powers to committees appointed by the Board. We have five standing Board committees: the Audit Committee, the Human Resources and Compensation Committee, the Enterprise Risk Management Committee, the Corporate Governance and Nominations Committee and the materials used in the solicitation will be borne by Bunge-Bermuda. In addition to solicitation by mail, Bunge-Bermuda will make arrangements with brokerage houses and other custodians, nominees and fiduciaries to send the proxy materials to beneficial owners, and Bunge-Bermuda will, upon request, reimburse those brokerage houses and custodians for their reasonable related expenses. Bunge-Bermuda has retained [●] for a fee of $[●], plus expenses, to aid in the solicitation of proxies from its shareholders and to verify certain records related to the solicitations. To the extent necessary in order to ensure sufficient representation at its meeting, Bunge-Bermuda or its proxy solicitor may solicit the return of proxies by personal interview, mail, telephone,
6619 Bunge | 2023 Proxy Statement
facsimile, InternetSustainability and Corporate Responsibility Committee. Each of these committees is chaired by an independent director and composed entirely of independent directors. The members of the Audit Committee and the Human Resources and Compensation Committee also meet the enhanced independence rules of the SEC and NYSE applicable to such committees. Pursuant to their charters, each of these committees are authorized and assured of appropriate funding to retain and consult with external advisors and counsel, as they deem appropriate, to assist in the performance of their duties. The committees are required to conduct meetings and take action in accordance with the directions of the Board, the provisions of our bye-laws and the terms of their respective committee charters. Each of these committees has the power under its charter to sub-delegate the authority and duties designated in its charter to subcommittees or other meansindividual members of electronic transmission. the committee as it deems appropriate, unless prohibited by law, regulation or any NYSE listing standard. Copies of these committee charters are available through the "Investors — Corporate Governance" section of our website, bunge.com. Please note that the information contained in or connected to our website is not intended to be part of this proxy statement.
The extenttables that follow provide primary responsibilities and 2022 membership and meeting information for each Board committee as of December 31, 2022 (for the membership of each of the Board Committees that is expected following the Annual General Meeting, see "Director Nominees" on page 2). See "Environmental, Social and Governance" for a description of the role each Board committee serves with respect to the oversight of ESG matters: | | | | | |
2022 meetings l 9 | Primary Responsibilities: |
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Members: Henry "Jay" Winship (Chair) Eliane Aleixo Lustosa de Andrade Sheila Bair Kenneth Simril Mark Zenuk | •the quality and integrity of our financial statements and related disclosures; •compliance with legal and regulatory requirements; •the independent auditor's qualifications, independence, fees and performance; •the performance of our internal audit and control functions; and •assists the Board in its oversight of cybersecurity. |
The Audit Committee meets separately with our independent auditor and also in quarterly executive sessions with members of management, including our chief audit executive and our chief compliance officer. Additionally, the Audit Committee regularly meets in executive sessions at which this will be necessary depends upon how promptly proxiesonly the Audit Committee members are returned. We urge you to send in your proxyattendance, without delay.
Bunge-Bermuda shareholders (including any beneficial ownersmembers of such shares that give voting instructions to a custodian or clearing house that subsequently votesour management present. No Audit Committee member may simultaneously serve on the proposal) who vote either for or againstaudit committees of more than two other public companies without the proposal or who the Bermuda Court is satisfied have a substantial economic interest in the Scheme of Arrangement should note that they are entitled to appear in person or by counsel at the Bermuda Court hearing on [●] at which Bunge-Bermuda will seek the sanctionprior approval of the Redomestication. In addition, the Bermuda CourtBoard. Messrs. Winship and Simril qualify as audit committee financial experts.
Bunge | 2023 Proxy Statement 20
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| Human Resources and Compensation Committee |
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2022 meetings l 6 | Primary Responsibilities: |
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Members: J. Erik Fyrwald (Chair) Bernardo Hees Kenneth Simril Henry "Jay" Winship | •designing, reviewing and overseeing Bunge's executive compensation program; •reviewing and approving corporate goals and objectives relevant to the compensation of our CEO, evaluating the performance of the CEO in light of these goals and objectives and setting the CEO's compensation based on this evaluation; •reviewing the evaluation by the CEO of each executive officer reporting directly to the CEO and overseeing and approving the total compensation packages for each executive officer reporting directly to the CEO; •reviewing and approving employment, consulting, retirement and severance agreements and arrangements for the CEO and executive officers reporting directly to the CEO; •reviewing and making recommendations to the Board regarding our incentive compensation plans, including our equity incentive plans, and administering our equity incentive plans; •establishing and reviewing our executive and director share ownership guidelines; •reviewing our compensation practices to ensure that they do not encourage unnecessary and excessive risk-taking; •making recommendations to the Board on director compensation; and •overseeing talent management programs, succession planning and the Company's initiatives and policies related to diversity and inclusion, workforce environment and culture. |
The Human Resources and Compensation Committee has wide discretionsole authority to hear from interested parties. Bunge-Bermuda has agreed that it will not objectselect and retain any compensation consultants or advisors and to the participation by any shareholder in the Bermuda Court hearingapprove their fees. For additional information on the grounds that such person does not have a substantial economic interest inHuman Resources and Compensation Committee's role, its use of outside advisors and their roles, as well as the SchemeHuman Resources and Compensation Committee's processes and procedures for the consideration and determination of Arrangementexecutive compensation, see "Compensation Discussion and Analysis — Determining Compensation" beginning on page 42 of this proxy statement. 6721 Bunge | 2023 Proxy Statement
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| Corporate Governance and Nominations Committee |
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2022 meetings l 4 | Primary Responsibilities: |
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Members: Sheila Bair (Chair) Carol Browner Kathleen Hyle Henry "Jay" Winship | •monitoring significant developments in the law and practice of corporate governance and overseeing, reviewing, and recommending changes to the Company’s corporate governance framework; •leading the Board in its annual performance evaluation; •developing and recommending to the Board and overseeing the Corporate Governance Principles of the Company; •advising the Board with respect to charters, structure, and functions of the committees of the Board and qualifications for membership thereon; •assisting the Board by actively identifying individuals qualified to become Board members; •overseeing policies and processes relating to director orientation and continuing education; •assisting the Board with director succession planning and director recruitment processes; •making director independence recommendations to the Board; •recommending to the Board the director nominees for election at the next annual meeting of shareholders; and •periodically reviewing the political contribution program and the Company's position and engagement on relevant public policy governance issues. |
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| Enterprise Risk Management Committee |
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2022 meetings l 4 | Primary Responsibilities: |
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Members: Mark Zenuk (Chair) Sheila Bair Paul Fribourg (until his resignation from the Board effective December 31, 2022) Michael Kobori | •supervising the quality and integrity of our risk management practices; •reviewing and approving our risk management policies and risk limits on a periodic basis (including climate-related risks) and advising our Board on risk management practices (see "Risk Oversight" on page 25 for more information); and •overseeing the development of an Enterprise Risk Management framework, periodically reviewing a wider scope of enterprise risks facing the Company, and management's risk mitigation strategies. |
Bunge | 2023 Proxy Statement 22
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| Sustainability and Corporate Responsibility Committee |
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2022 meetings l 4 | Primary Responsibilities: |
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Members: Carol Browner (Chair) Eliane Aleixo Lustosa de Andrade Paul Fribourg (until his resignation from the Board effective December 31, 2022) J. Erik Fyrwald Bernardo Hees Michael Kobori
| •oversight of our governance policies, strategies and programs with respect to sustainability and corporate social responsibility, including matters related to: –human rights; –food safety; –environmental matters related to climate change and emissions, water conservation and management, energy consumption and efficiency, product stewardship, and waste disposal; –the Company's public commitments regarding non-deforestation and emissions reductions; –ESG external trends and public affairs; –relations with stakeholders; –assisting the Board and Enterprise Risk Management Committee in fulfilling their risk management oversight responsibility relating to ESG; and –philanthropy and community relations. |
23 Bunge | 2023 Proxy Statement
Board and Committee Evaluations
Pursuant to NYSE requirements, our Corporate Governance Principles and the charters of each of the Board’s committees, the Board and each of its committees conducts annual self-assessments of their performance. The Board recognizes that a thorough and constructive assessment process is an essential component of good corporate governance. These self-assessments are intended to facilitate a candid assessment and discussion by the Board and each committee of its effectiveness and performance and identification of areas for improvement. A summary of the process is below:
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| Questionnaires: | •The Corporate Governance and Nominations Committee Chair and the Committee members oversee the overall Board committee self-assessment process. •Questionnaires for the Board and each standing committee are reviewed and updated on an annual basis prior to distribution to each of the directors. •Topics include, but are not limited to: –Board and committee dynamics, meetings, materials and effectiveness; –the flow of information to and from the Board and its committees; –Board composition, size and leadership; and –corporate strategy, risk oversight and management, director and executive compensation, succession planning and shareholder engagement.
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| Individual Directors: | •Each director is provided with a questionnaire for the full Board and one for each standing committee on which the director serves.
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| Reviews: | •The Corporate Governance and Nominations Committee, along with the third-party facilitator, which may be retained as deemed appropriate, reviews and discusses the responses to the Board and all committee questionnaires. •Each committee reviews and discusses the responses to their respective committee questionnaires. •The Corporate Governance and Nominations Committee provides the Board with a summary of the Board and committee questionnaires and develops recommendations for areas that the Board and its committees should consider as improvements. These areas are further discussed by the Board. |
| Board Summary and Feedback: | •The Chair of the Corporate Governance and Nominations Committee, working with the Board Chair, other directors and the senior management team as appropriate, develops action plans for any items that require follow-up.
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| Changes implemented: | •In addition to significant Board refreshment, in recent years the Board’s approach to Board and committee self-assessments has resulted in changes made to Board agendas, meeting materials, management presentations, committee responsibilities and charters, committee consultants, leadership and composition. |
Executive Succession Planning and Leadership Development
Succession planning and leadership development are top priorities for the Board and management. On an annual and as needed basis, the Human Resources and Compensation Committee, with oversight by the Board, reviews succession plans and candidate profiles for the CEO and other senior management positions, and oversees talent management programs that drive capability building, leadership development and workforce culture. The Human Resources and Compensation Committee also reviews workforce health metrics at each meeting that provide insight into workforce movement, diversity and inclusion initiatives, engagement and culture.
The Board believes that succession planning:
•is a board-driven, collaborative and continuous process;
Bunge | 2023 Proxy Statement 24
•should consider the Company's long-term strategic goals; and
•involves building a diverse and inclusive, talent-rich organization by attracting and developing the right people. Individuals who are identified as succession candidates for critical positions are given exposure and visibility to Board members through formal presentations and informal events.
Risk Oversight
Our Board of Directors oversees management's approach to risk management, which is designed to support the achievement of our strategic objectives and enhance shareholder value. Our Board has considered the most effective organizational structure to appropriately oversee major risks. It has established a dedicated Board committee, the Enterprise Risk Management Committee, which enables greater focus at the Board level on risk oversight tailored to our business and industries. Additionally, each of our other Board committees considers risks within its area of responsibility. All Board committees regularly report on their activities to the full Board to promote effective coordination and to ensure that the entire Board remains apprised of major risks, how those risks may interrelate, and how management addresses those risks. Finally, Bunge has management teams responsible for risk, including a Chief Risk Officer, a Management Risk Committee and an Internal Audit team to assist with the day-to-day implementation, governance and monitoring of risk management strategies and risk mitigation efforts. An overview of each Board committee and their respective roles in risk oversight are outlined below:
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| Entity | Primary Responsibility for Risk Management |
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| Enterprise Risk Management Committee | •Oversees the quality and integrity of our risk management practices relating to the following key areas: commodities risk, foreign exchange risk, liquidity, interest rate and funding risk, credit and counterparty risk, country risk, climate-related risk, new trading or investing business activity risk and sanctions and derivatives compliance. •Reviews and approves corporate risk policies and limits associated with our risk appetite. •Oversees the development of an Enterprise Risk Management framework, periodically reviewing a wider scope of enterprise risks facing the Company, and management's risk mitigation strategies. •Meets regularly with our CEO, CFO, Chief Risk Officer, and other members of senior management to receive regular updates on our risk profile and risk management activities. |
| Audit Committee | •Oversees risks related to our financial statements, the financial reporting process and accounting and financial controls. •Receives an annual risk assessment briefing from our chief audit executive, as well as periodic update briefings, and reviews and approves the annual internal audit plan that is designed to address the identified risks. •Reviews key risk considerations relating to the annual audit with our independent auditor. •Assists the Board in fulfilling its oversight responsibility with respect to legal and compliance matters, including meeting with and receiving periodic briefings from members of our legal staff and chief compliance officer. •Oversees our cybersecurity and other information technology risks, including risk management programs and controls. |
25 Bunge | 2023 Proxy Statement
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| Entity | Primary Responsibility for Risk Management |
| Human Resources and Compensation Committee | •Oversees risks relating to compensation and benefits programs to ensure incentives are appropriately balanced and do not motivate executives and employees to take imprudent risks. •Oversees programs, policies and practices relating to talent management, diversity and inclusion, and workforce environment and culture. •Oversees CEO and senior management succession planning and compensation. •Advises the Board on CEO and director compensation. See "Compensation and Risk" beginning on page 57 of this proxy statement for more information. |
| Corporate Governance and Nominations Committee | •Oversees risks related to our governance framework and processes. •Identifies individuals qualified to serve as Board members pursuant to the guidelines and diversity policy established by the Board in the Corporate Governance Principles. •Provides oversight of Board effectiveness and independence. •Conducts the annual Board and committee self-assessment process that is aimed at ensuring that the Board and its committees are functioning effectively and able to meet their responsibilities, including risk oversight. |
| Sustainability and Corporate Responsibility Committee | •Oversees the Company's governance, policies, strategies and programs related to sustainability, corporate social responsibility matters, human rights, food safety, product stewardship, and environmental trends, issues, risks and concerns which could affect the Company’s business activities and performance. •Oversees and provides guidance to management on sustainability, corporate social responsibility, political and environmental governance matters in public debate, public policy, regulation and legislation. •Reviews the Company's charitable giving policies and programs. |
| Management | •Chief Risk Officer: Implements an effective risk management framework and provides daily oversight of risk. •Chief Technology Officer: Provides updates to the Audit Committee on cyber trends, incidents, risks, and the Company's response systems and mitigation strategies on an annual and as needed basis. •Internal Audit: Provides reliable and timely information to our Board, Audit Committee and management regarding our Company’s effectiveness in identifying and appropriately controlling risks. •Management Risk Committee: Reviews and monitors key exposures, emerging risks and drivers of risk. Serves as the most senior management-level risk governance body at the Company, and reviews on an ongoing basis key enterprise risks. Provides oversight for all risk management activities, including the risk framework. |
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Bunge | 2023 Proxy Statement 26
Corporate Governance Principles and Code of Conduct
Our Board has adopted Corporate Governance Principles that set forth our corporate governance objectives and policies and, subject to our bye-laws, govern the functioning of the Board. Our Corporate Governance Principles are available through the "Investors — Corporate Governance" section of our website, bunge.com. Please note that information contained in or connected to our website is not intended to be part of this proxy statement.
The Code of Conduct reflects our values, vision and culture and sets forth our commitment to ethical business practices and reinforces various corporate policies. Our Code of Conduct applies to all of our directors, officers and employees worldwide, including our CEO and senior officers. Our Code of Conduct is available on our website. We intend to post amendments to and waivers of (to the extent applicable to certain officers and our directors) our Code of Conduct on our website.
Communications with Our Board
To facilitate the ability of shareholders to communicate with our Board and to facilitate the ability of interested persons to communicate with non-management directors, the Board has established a physical mailing address and an electronic address to which such communications may be sent, which is available on our website, bunge.com, through the "Investors — Corporate Governance" section.
Communications received are initially directed to our legal department, where they are screened to eliminate communications that are merely solicitations for products and services, items of a personal nature not relevant to us or our shareholders and other matters that are improper or irrelevant to the functioning of the Board or Bunge. All other communications are forwarded to the relevant director, if addressed to an individual director or a committee chair, or to the members of the Corporate Governance and Nominations Committee if no particular addressee is specified.
Board Member Attendance at Annual General Meetings
It is the policy of our Board that our directors attend each annual general meeting of shareholders. In 2022, all nominees who were serving as directors at the time attended our annual general meeting.
Environmental, Social and Governance
We recognize the interconnectedness of addressing climate change, building a more sustainable food system and efforts to enhance food security. Bunge’s size and connectivity means we not only have a unique perspective on a variety of aspects of the food security conversation but we believe we can also help to influence the solutions at scale. That’s why we strive to incorporate sustainability into many areas of our business, from how we plan and develop our strategic goals, compensate employees and operate our facilities to how we engage with our customers, suppliers, employees, communities and other stakeholders.
The very nature of the work we do — connecting farmers to consumers to deliver essential food, feed and fuel to the world — requires a deep understanding of the environment and market demands around us. It means we must face head on the realities of a changing climate and food insecurity, as we work to minimize our impact on the planet while meeting the needs of consumers and communities.
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| | “Our accelerated focus on embracing sustainable business opportunities and making company-wide improvements has contributed to record earnings and positioned the company for long-term success. We provide value for our shareholders while contributing to more climate-friendly agribusiness and more secure, sustainable food systems.” |
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| –Robert Coviello Chief Sustainability Officer and Government Affairs |
27 Bunge | 2023 Proxy Statement
Our key areas of growth—expansion of our oilseed processing and origination capabilities, production of renewable feedstocks, increasing our plant lipids portfolio and development of new plant-based protein ingredients—are not only central to our business strategy but also a testament to the alignment of sustainability with our corporate vision.
In recent years, company-wide improvements enabled Bunge to take advantage of improved market conditions and generate record earnings, which we expect will position us for long-term success. We aim to provide value for our shareholders while continuing to accelerate our focus on sustainable business opportunities that contribute to more climate-friendly agribusiness and food systems.
To meet today's challenges and contribute to the solutions ahead, we have defined sustainability goals that incorporate activities and commitments supporting three key areas:
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| | Action on Climate | We implement innovative solutions to minimize our environmental footprint and support projects and activities that strengthen our approach to fighting climate change |
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| | Responsible Supply Chains | We promote sustainable agriculture and implement robust projects that protect and improve the environment, while supporting the social and economic well-being of growers and local communities |
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| | Accountability | We aim to be an accountable leader within our industry, helping to raise the bar on our sector’s performance by regularly tracking and disclosing progress on our commitments and sustainability performance |
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Bunge’s five Board committees oversee Bunge’s governance, compensation, risk management and sustainability practices, including climate-related risks and opportunities.
•Oversight of sustainability at Bunge is led by the Sustainability and Corporate Responsibility Committee and specific related sustainability responsibilities are integrated across other Board committees. The Sustainability and Corporate Responsibility Committee oversees and provides input on the development of sustainability and corporate social responsibility policies, strategies and programs of the Company.
•The Corporate Governance and Nominations Committee has the overall responsibility for overseeing, among other things, Bunge’s governance frameworks and board practices, as well as the identification of qualified board candidates with the appropriate skills, diversity and experience to oversee Bunge’s business.
•The Human Resources and Compensation Committee oversees our compensation framework, governance, guidelines and performance criteria, which includes Environmental, Social and Governance (ESG) and human capital metrics. It also oversees initiatives and policies related to diversity and inclusion, workforce environment and culture.
•The Enterprise Risk Management Committee evaluates climate-related risks and exposures in connection with its periodic review of other enterprise risks facing the Company, and management's risk mitigation strategies.
•The Audit Committee evaluates trends and developments in non-financial reporting practices and requirements which impact the Company's regulatory filings, including ESG disclosures.
Members of our executive leadership team are directly involved in the development and execution of our sustainability strategy, which includes the management of climate-related risks and opportunities. Below are some highlights of their involvement and responsibilities:
•Chief Executive Officer is the final arbiter in the management of sustainability strategy, risks and opportunities, and helps to set the overall vision for the company.
Bunge | 2023 Proxy Statement 28
•Co-Presidents of Agribusiness oversee the commercial and industrial operations of the business, with management over the sustainability opportunities from products and services, and the implementation of sustainability commitments within the multiple value chains of the enterprise.
•President of Food Solutions oversees the sustainability solutions for key global customers in Bunge’s food and ingredients business, particularly in tropical and edible oils.
•Chief Financial Officer (CFO) is the management lead of the Audit Committee. The CFO provides overall guidance and strategic input into financial opportunities and risks associated with sustainability issues, as well as oversight of Bunge’s sustainability-linked credit facilities and other “green” loans.
•Chief Human Resources Officer (CHRO) is the management lead of the Human Resources and Compensation Committee. The CHRO oversees the embedding of ESG metrics—such as emissions performance, diversity, and safety—into the compensation of Bunge employees. The CHRO also leads the diversity, equity and inclusion strategy, along with the talent development programs throughout the business.
•Chief Risk Officer (CRO) is the management lead of the Enterprise Risk Management Committee. The CRO oversees the enterprise risk management process of the company, with the inclusion of climate-related risks and opportunities and their impacts on the business strategy, operations and investments.
•Chief Transformation Officer assesses long-term business growth strategy and opportunities, and considers the sustainability impact they may have.
•Chief Legal Officer (CLO) is the management lead of the Corporate Governance and Nominations Committee. The CLO manages legal and ethical risks and regulatory compliance of the business.
•Chief Sustainability Officer and Government Affairs (CSO) is the management lead of the Sustainability and Corporate Responsibility Committee. The CSO leads a global team operating across multiple geographies and functions, which regularly engages business leadership to ensure company-wide alignment with sustainability objectives and opportunities.
Over the past year, Bunge has established multiple cross-functional teams of subject matter experts focused on ESG matters, including human rights, climate, water and non-deforestation, in an effort to further embed sustainability throughout the company. The teams meet regularly to discuss a range of topics that can help achieve our sustainability commitments and disclosures, or which might have a strategic, operational or financial impact on our business.
Additional information on sustainability governance and oversight can be found in Bunge’s upcoming 2023 Global Sustainability Report, which will be located on our website at bunge.com/sustainability.
Sustainability at Bunge in 2022 and Beyond
•Bunge’s commitment to meaningful climate action is grounded in a sincerely held belief that we have the right ingredients for success, and a proven track record of helping move the industry in the right direction. Our prior emissions goals dating back to 2008, our enhanced governance, and our industry-first 2025 non-deforestation commitment underscore our dedication to creating transformation in the food industry and helping our partners achieve scalable impact on our common objectives.
•Bunge is deeply involved in conversations supporting the development of reliable methodologies that can lead to more ambitious emissions reduction targets for food and agriculture companies. By leveraging our climate leadership, integrating these new methodologies into our strategic planning, and engaging credible third-party organizations, we will publish a climate transition plan that identifies pathways for 1.5 degree Celsius targets, to be available in late 2024. Further details will be published in the 2023 Global Sustainability Report.
•Our strong execution and vision for decarbonization in our growth strategy enabled us to establish Science Based Targets in 2021 with an aim to achieve absolute reductions in carbon emissions for our own operations and in our supply chains. In 2022, we continued to see emissions reductions in our operations and in our supply chains.
29 Bunge | 2023 Proxy Statement
•A substantial portion of emissions reduction within our supply chains, known as Scope 3 emissions, are tied to our industry-leading commitment to have deforestation-free supply chains in 2025. Progress against this commitment remains strong, as we achieve improved traceability and monitoring figures to our sourcing in the high priority geographies of the world.
•We also continued to improve governance and strategy on our human rights program, our engagement with communities through an updated corporate contributions policy, and our interaction with stakeholders through regular consultations and workshops.
•Performance-based sustainability goals are a component of the annual incentive bonuses paid to our executive team and over 5,500 of our employees. Our compensation framework is based on a pay-for-performance philosophy with payout now directly impacted by our attainment of certain sustainability targets.
For more information about our sustainability efforts, annual reports and dashboards, please visit bunge.com/sustainability.
Human Capital Management
Our ability to deliver results for our customers, each other and the world starts with a workplace environment focused on collaboration, inclusiveness, innovation and accountability. We value the multi-cultural perspectives of our global team and are committed to developing and rewarding our employees for their high level of engagement and commitment to Bunge. We provide our team with the opportunity to enhance their careers at Bunge while making a genuine impact and connecting meaningfully with others.
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| | What we do every day matters and our team takes great pride in working together to find new ways of connecting farmers to consumers around the world. Each employee at Bunge is unique and brings a strong voice with the ability to make a difference. We are committed to fostering a culture of belonging to ensure we can retain and attract the great talent we need to deliver on our essential purpose. |
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| –Kellie Sears Chief Human Resources Officer |
2022 Workforce Highlights
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| Global Female Diversity | | | 85% Y Employee Engagement | | | Reduction in Total Recordable Injury Rate
q15% YOY |
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21% Senior Leadership | | | 42% SG&A(1) Population | | | | |
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| | | | Named to Newsweek's List of Most Loved Workplaces for 2021 and 2022 | | |
| Overall female population 25% | | | | | We believe in social responsibility, community development projects and philanthropy. Bunge participates in and sponsors activities that support communities where we operate around the world. |
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U.S. Minority(2) | | | | |
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29% Leadership | | | 29% Overall Population | | | ~23,000 Employees Globally | | |
(1) SG&A stands for Selling, General and Administrative and generally encompasses our non-industrial, global corporate support functions.
(2) U.S. Minority encompasses all non-White race categories of employees tracked within the United States.
Bunge | 2023 Proxy Statement 30
Bunge's workforce is distributed globally with South America representing the largest portion of the workforce.
EMEA = Europe, Middle East, Africa
Our Board plays an important role in the oversight of talent management and culture at Bunge and our Human Resources and Compensation Committee devotes time each quarter to engage on strategic talent management and total rewards initiatives.
Diversity, Equity & Inclusion
Creating Belonging for Everyone. We know we are most successful in achieving our goals when we have diversity of talent and thought, providing an inclusive and equitable culture where all voices are valued. We pride ourselves on our international diversity, and the diversity of experience and industry backgrounds of our workforce. It is a top priority for us to continue advancing diversity, equity and inclusion within our organization, the industry and the communities where we live and work. We are also focused on increasing gender diversity and opportunities for women in leadership positions and recently added two women to our executive leadership team.
For more information regarding diversity, equity and inclusion at Bunge, refer to the “Careers – Diversity, Equity and Inclusion” section of our website, bunge.com, including data submitted through our 2022 EEO-1 report, which we anticipate will be available within 45 days of the EEO-1 report being filed with the U.S. Equal Employment Opportunity Commission (EEOC) later this year.
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We are one of the founding members of Together We Grow, an industry consortium made up of corporations, nonprofits, academic institutions and NGOs—focused on building the workforce of tomorrow and ensuring that the workforce is skilled, diverse and inclusive. | |
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| As part of the CEO Action for Diversity & Inclusion pledge, along with a wide range of industry leaders, we are dedicated to advancing diversity and inclusion within the workplace—with the goal of building inclusive workplace environments where employees feel empowered to bring their authentic selves to work. |
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As a member of the Paradigm for Parity® coalition, we are committed to addressing gender parity in corporate leadership positions. In partnership with the coalition, we’ll work to achieve gender equality throughout our leadership structure by 2030 – a critical step in ensuring diversity of thought is represented at Bunge. | |
31 Bunge | 2023 Proxy Statement
Bunge’s Diversity, Equity & Inclusion Pillars align our actions to three primary areas:
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| Workforce Representation and Inclusive Environment | | | Social Responsibility and Community Outreach | | | Accountability |
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•We are committed to retain, attract, engage and advance talent that is representative of the communities we live in and the customers we serve •We provide equitable opportunities for recruitment and promotion and create an environment that welcomes and celebrates individual uniqueness | | | •We position ourselves as an employer of choice, a good corporate citizen and leader in the agribusiness and the food industry •We use our position as a global leader to make a positive impact on our communities and the world •We champion fair labor practices and foster inclusion and equity in our supplier network and in the communities where we operate | | | •We hold ourselves accountable to enhancing diversity representation and inclusion in our workforce •We develop effective processes, systems and measures to track progress |
Public Policy Engagements
Lawmakers and agency officials govern and regulate many aspects of our industry and can have considerable influence on our success. Therefore, we believe political advocacy is an important way to support our business interests and contribute positively to the communities where we operate. Accordingly, senior leadership and our Board encourage involvement in activities that advance Bunge’s goals. We support political candidates that align with our values and business principles and who have strong connections to areas where we have facilities. In addition, we are members of organizations that may contribute to dialogue and political action on agricultural, food and biofuel issues.
As a company, we engage in activities that include lobbying, making contributions to candidates from our employee-funded political action committee (PAC) in the U.S., and participating in trade associations. The PAC board approves disbursements to candidate committees based upon a prescribed set of criteria. Those criteria include: presence of a Bunge facility in the candidate’s district; key committee assignment; leadership position; support for key issues; and sharing Bunge’s values.
The Corporate Governance and Nominations Committee periodically reviews the political contribution program, including political contributions made by the Bunge PAC.
To learn more about our political engagement and contributions, and to view our lobbying and contributions disclosures, please visit bunge.com/corporate-governance/political-contributions.
Bunge | 2023 Proxy Statement 32
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SECURITYDIRECTOR COMPENSATION |
Our compensation program for non-employee directors is designed to enable us to retain, attract and motivate highly qualified directors to serve on our Board. It is also intended to further align the interests of our directors with those of our shareholders. Annual compensation for our non-employee directors in 2022 comprised a mix of cash and equity-based compensation. The Human Resources and Compensation Committee annually receives competitive information on the status of Board compensation for non-employee directors from its independent compensation consultant and is responsible for recommending to the Board changes in director compensation. In 2022, the following changes were made to the compensation of the Board of Directors:
•Increased the value of the annual equity award to better align with the market and to focus attention on long-term success
•Decreased the supplemental annual cash retainer fee and the value of the annual equity award for the non-employee Chair to reflect the change in the level of responsibility
•Increased all Committee Chair fees by $5,000 to better align with the market and the responsibilities of each committee
Directors' Fees
Non-employee directors received the following fees in 2022:
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| | | | | •Each member of the Audit Committee receives an annual fee for the added workload and responsibilities of this committee. •No fees are paid for services as a member of any other committee. •If the Board and/or a committee meets in excess of 10 times in a given year, each non-employee director receives a fee of $1,000 for each additional meeting attended. •Non-employee directors are reimbursed for reasonable expenses incurred by them in attending Board meetings, committee meetings and shareholder meetings. |
| Non-Employee Director Compensation | | Director | | |
| | | | |
| Annual Cash Retainer Fee | | | | |
| All Non-Employee Directors | | $100,000 | | |
| Non-Employee Chair (supplemental) | | $75,000 | | |
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| Annual Equity Award | | | | |
| All Non-Employee Directors | | $200,000 | | |
| Non-Employee Chair (supplemental) | | $100,000 | | |
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| Committee Compensation | Member | Chair | | |
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| Annual Fee - Audit Committee | $10,000 | $25,000 | | |
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| Annual Fee - All Other Committees | $— | $20,000 | | |
Non-Employee Director Share Ownership Guidelines
To further align the personal interests of the Board with the interests of our shareholders, the Board has established share ownership guidelines for the minimum amount of common shares that are required to be held by our non-employee directors. These guidelines are required to be met within five years of a non-employee director's initial appointment or election to the Board. For non-employee directors, the guideline is five times the annual cash retainer fee paid by Bunge to its non-employee directors (i.e., $500,000). Shares deemed to be owned for purposes of the share ownership guidelines include only shares owned directly. Unvested restricted stock units do not count toward satisfaction of the guidelines. We have not granted any stock options under the Bunge Limited 2017 Non-Employee Directors Equity Incentive Plan, as Amended and Restated. Furthermore, our non-employee directors are required to hold 100% of the net shares acquired through the equity incentive plans until the guidelines are met.
33 Bunge | 2023 Proxy Statement
Bunge Limited 2017 Non-Employee Directors Equity Incentive Plan
The Bunge Limited 2017 Non-Employee Directors Equity Incentive Plan, as Amended and Restated (the "2017 NED Plan"), was approved by our shareholders in May 2021. The 2017 NED Plan, unless otherwise determined by the Human Resources and Compensation Committee, provides for an annual equity award to each non-employee director as of the date of our annual general meeting of shareholders. A non-employee director who is elected or appointed to the Board other than on the date of an annual meeting shall receive, as of the date of such election or appointment, a pro rata portion of the awards made to non-employee directors generally on the immediately preceding date of grant based on the number of days from the date of election or appointment to the next annual meeting, divided by 365. The value, type and terms of such awards are determined by the Human Resources and Compensation Committee; however, the grant date fair value of all awards payable in common shares for services rendered by each non-employee director during any calendar year may not exceed $540,000. We may grant nonqualified stock options, stock appreciation rights, restricted stock units and other forms of awards that generally are based on the value of our common shares under the 2017 NED Plan. Unless otherwise determined by the Human Resources and Compensation Committee, equity awards generally vest on the date of the first annual general meeting of shareholders following the applicable grant date, provided the director continues to serve on the Board until such date. To date, we have granted only restricted stock units under the plan. Unless prohibited by the 2017 NED Plan or the Human Resources and Compensation Committee determines otherwise prior to a change in control, upon the occurrence of a change in control and either (i) a successor fails to assume, substitute or replace outstanding awards or (ii) a non-employee director’s service is terminated on or before the occurrence of the first anniversary of the change in control: (1) any restricted stock units and other forms of award shall immediately vest; and (2) any outstanding and unvested nonqualified stock options and stock appreciation rights shall become immediately exercisable. The 2017 NED Plan provides that up to 320,000 common shares may be issued under the plan. As of December 31, 2022, granted shares under the plan totaled 143,431, inclusive of dividend equivalents.
Prohibitions Against Short Sales, Hedging, Margin Accounts and Pledging
Our insider trading and pre-clearance policy prohibits directors, officers, employees and entities controlled by them, among others, from engaging in short sale transactions in our securities, holding our securities in margin accounts or pledging our securities as collateral. Additionally, directors, members of our executive committee and entities controlled by them, among others, are further prohibited from owning, holding, purchasing, selling, exercising, converting or otherwise acquiring or benefiting from any derivative securities, including puts, calls, equity collars, straddles, forward contracts and similar instruments that may be used as part of a hedging, tax, risk management or other strategy (other than stock options, restricted stock or restricted stock units issued by us).
Bunge | 2023 Proxy Statement 34
Director Compensation Table
The following table sets forth the compensation for non-employee directors who served on our Board during the fiscal year ended December 31, 2022.
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| Non-Employee Director Compensation |
| Name | Fees Earned or Paid in Cash ($) | Stock Awards(1)(2) ($) | Total ($) |
| Eliane Aleixo Lustosa de Andrade | $14,049 | $88,812 | $102,861 |
| Sheila Bair | $129,173 | $199,968 | $329,141 |
| Carol Browner | $119,173 | $199,968 | $319,141 |
| Paul Fribourg | $101,000 | $199,968 | $300,968 |
| J. Erik Fyrwald | $119,173 | $199,968 | $319,141 |
| Bernardo Hees | $101,000 | $199,968 | $300,968 |
| Kathleen Hyle | $185,135 | $299,952 | $485,087 |
| Michael Kobori | $101,000 | $199,968 | $300,968 |
| Kenneth Simril | $111,000 | $199,968 | $310,968 |
| Henry "Jay" Winship | $124,173 | $199,968 | $324,141 |
| Mark Zenuk | $129,173 | $199,968 | $329,141 |
(1)Each of the non-employee directors serving on the Board on the close of business on Bunge's May 12, 2022 Annual General Meeting received an annual grant of 1,842 restricted stock units. In addition, as part of Ms. Hyle's compensation for serving as non-employee Chair, she was granted an additional 921 restricted stock units. Annual grants vest on the first anniversary of the date of grant (May 12, 2022), provided the director continues to serve on the Board on such date. Following her appointment to the Board on November 15, 2022, Ms. Aleixo Lustosa received a prorated annual grant of 898 restricted stock units vesting on May 12, 2023. The average of the high and low sale prices of our common shares on the NYSE was $108.56 on May 12, 2022 and $98.90 on November 15, 2022.
(2)The amounts shown reflect the full grant date fair value of the award for financial reporting purposes in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (ASC Topic 718) (without any reduction for risk of forfeiture) as determined based on applying the assumptions used in Bunge's audited financial statements. See Note 27 to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2022, regarding assumptions underlying the valuation of equity awards. Other than the restricted stock units reported above and associated dividend equivalents, no director had any other stock awards outstanding as of December 31, 2022. The number of awards granted excludes dividend equivalents. The closing price of our common shares on the NYSE on December 31, 2022 was $99.77.
35 Bunge | 2023 Proxy Statement
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SHARE OWNERSHIP OF CERTAIN BENEFICIAL OWNERSDIRECTORS, EXECUTIVE OFFICERS AND PRINCIPAL SHAREHOLDERS |
The following table sets forth information with respect to persons or entities who are known to Bunge-BermudaBunge to beneficially own 5% or more of our common shares, each member of our Board, each NEO and all directors and executive officers as a group as of [●].March 13, 2023.
All holders of our common shares are entitled to one vote per share on all matters submitted to a vote of holders of common shares, and the voting rights attached to common shares held by our directors, executive officers or major shareholders do not differ from those that attach to common shares held by any other holder.
Under Rule 13d-3 of the Exchange Act, "beneficial ownership" includes shares for which the individual, directly or indirectly, has or shares voting or investment power, whether or not the shares are held for the individual's benefit.
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| Amount and Nature of Beneficial Ownership |
| | (Number of Shares) | | |
Beneficial Owner | Direct or Indirect(1)
| Voting or Investment Power(2)
| | Right to Acquire(3)
| | Percent of Class(4)
|
Capital World Investors(5)
| — | | — | | | — | | | — | |
The Vanguard Group(6)
| — | | — | | | — | | | — | |
BlackRock, Inc.(7)
| — | | — | | | — | | | — | |
T. Rowe Price Associates, Inc.(8)
| — | | — | | | — | | | — | |
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Non-Employee Directors | | | | | | |
Sheila Bair | — | | — | | | — | | | — | |
Carol Browner | — | | — | | | — | | | — | |
Paul Fribourg | — | | — | | | — | | | — | |
J. Erik Fyrwald | — | | — | | | — | | | — | |
Bernardo Hees | — | | — | | | — | | | — | |
Kathleen Hyle | — | | — | | | — | | | — | |
Michael Kobori | — | | — | | | — | | | — | |
Kenneth Simril | — | | — | | | — | | | — | |
Henry "Jay" Winship | — | | — | | | — | | | — | |
Mark Zenuk | — | | — | | | — | | | — | |
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Named Executive Officers | | | | | | |
Gregory Heckman | — | | — | | | — | | | — | |
John Neppl | — | | — | | | — | | | — | |
Christos Dimopoulos | — | | — | | | — | | | — | |
Julio Garros | — | | — | | | — | | | — | |
Joseph Podwika | — | | — | | | — | | | — | |
All directors and executive officers as a group (19 persons) | — | | — | | | — | | | — | |
*Indicates beneficial ownership less than 1.0%. | | | | | | |
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| Amount and Nature of Beneficial Ownership |
| (Number of Shares) |
| Beneficial Owner | Direct or Indirect(1) | | Voting or Investment Power(2) | | Right to Acquire(3) | | Percent of Class(4) |
Capital World Investors(5) | 19,967,031 | | | — | | | — | | | 13.3 | % |
The Vanguard Group(6) | 15,170,725 | | | — | | | — | | | 10.1 | % |
BlackRock, Inc.(7) | 12,692,507 | | | — | | | — | | | 8.5 | % |
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| Non-Employee Directors | | | | | | | |
| Eliane Aleixo Lustosa de Andrade | — | | | — | | | 908 | | | * |
| Sheila Bair | 7,213 | | | — | | | 1,885 | | | * |
| Carol Browner | 21,642 | | | — | | | 1,885 | | | * |
Paul Fribourg(8) | 56,407 | | | 1,051,204 | | | — | | | * |
| J. Erik Fyrwald | 28,602 | | | — | | | 1,885 | | | * |
| Bernardo Hees | 13,113 | | | — | | | 1,885 | | | * |
| Kathleen Hyle | 33,628 | | | — | | | 2,827 | | | * |
| Michael Kobori | 841 | | | — | | | 1,885 | | | * |
| Kenneth Simril | 841 | | | — | | | 1,885 | | | * |
| Henry "Jay" Winship | 25,500 | | | — | | | 1,885 | | | * |
| Mark Zenuk | 16,439 | | | — | | | 1,885 | | | * |
| | | | | | | |
| Named Executive Officers | | | | | | | |
| Gregory Heckman | 478,667 | | | — | | | 935,000 | | | * |
| John Neppl | 65,908 | | | — | | | 36,500 | | | * |
| Christos Dimopoulos | 59,049 | | | — | | | 85,072 | | | * |
| Julio Garros | 53,109 | | | — | | | 31,750 | | | * |
| Joseph Podwika | 33,272 | | | — | | | 22,500 | | | * |
| All directors and executive officers as a group (18 persons) | 926,195 | | | 1,051,204 | | | 1,173,937 | | | 1.0 | % |
*Indicates beneficial ownership less than 1.0%.
(1)These shares are held individually or jointly with others, or in the name of a bank, broker or nominee for the individual's account or in a family trust. Excludes restricted stock units that remain unvested.
(2)This column includes other shares over which directors and executive officers have or share voting or investment power, including shares directly owned by corporate entities with whom they are presumed to share voting and/or investment power. Mr. Fribourg disclaims beneficial ownership of any shares to which he does not have a pecuniary interest.
Bunge | 2023 Proxy Statement 36
(3)This column includes shares which non-employee directors and executive officers have a right to acquire through the vesting of restricted stock units or the exercise of stock options granted under our equity incentive plansEquity Incentive Plans that have vested or will vest within 60 days of [●].March 13, 2023.
(4)Applicable percentage ownership is based on [●]149,941,547 common shares issued and outstanding as of [●].March 13, 2023.
(5)[Based on the information filed with the SEC on Schedule 13G/A on [●]:February 13, 2023: Capital World Investors reported beneficial ownership of [●]19,967,031 shares, sole voting power as to [●]19,872,286 of the shares and sole dispositive power as to [●]19,967,031 of the shares. The principal business address of Capital World Investors is 333 South Hope Street, 55th Floor, Los Angeles, California 90071.]
(6)[Based on information filed with the SEC on Schedule 13G/A on [●]:February 9, 2023: The Vanguard Group reported beneficial ownership of [●]15,170,725 shares, shared voting power as to [●]106,455 of the shares, sole dispositive power as to [●]14,844,335 of the shares and shared dispositive power as to [●]326,390 of the shares. The principal business address of The Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.]
(7)[Based on information filed with the SEC on Schedule 13G/A on [●]:February 3, 2023: BlackRock, Inc. reported beneficial ownership of [●]12,692,507 shares, sole voting power as to [●]11,283,016 of the shares and sole dispositive power as to [●]12,692,507 of the shares. The principal business address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.]
[Based on(8)Represents Mr. Fribourg's holdings as of December 31, 2022, the information fileddate he resigned as director.
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| DELINQUENT SECTION 16(A) REPORTS |
Section 16(a) of the Exchange Act requires the Company’s directors and executive officers and persons who own more than 10% of the Company’s common shares to file reports of their ownership in the equity securities of the Company and its subsidiaries and of changes in that ownership with the SEC. SEC regulations also require the Company to identify in this proxy statement any person subject to this requirement who failed to file any such report on Schedule 13G/Aa timely basis. To our knowledge, based solely on [●]: T. Rowe Price Associates, Inc. reported beneficial ownership of [●] shares, sole voting power as to [●]a review of the sharesfiled reports and sole dispositive power as to [●]written representations that no other reports are required, we believe that each of the shares. The principal business addressCompany’s directors and executive officers complied with all such filing requirements during 2022, except that (i) the vesting of T. Rowe Price Associates, Inc. is 100 E. Pratt Street, Baltimore, MD 21202.]performance-based restricted stock units that were granted as the deferred portion of the 2019 Risk Management & Optimization Incentive for Mr. Christos Dimopoulos and (ii) the shares withheld for the purpose of the payment of tax liability incident to the vesting and settling of such restricted stock units were inadvertently omitted from his March 15, 2022 Form 4 filing; an amended Form 4 was subsequently filed on March 21, 2022.
6937 Bunge | 2023 Proxy Statement
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MARKET PRICE AND DIVIDEND INFORMATIONPROPOSAL 2 — ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION |
(a) Market InformationPursuant to the rules of the Securities and Exchange Commission, we are required to provide shareholders with a non-binding advisory "say-on-pay" vote to approve the compensation of our Named Executive Officers (NEOs) as disclosed in the Compensation Discussion & Analysis (CD&A), accompanying compensation tables and related narrative disclosures on pages 39 through 64 of this proxy statement. The Board recognizes the importance of our shareholders' opportunity to cast an advisory say-on-pay vote as a means of expressing views regarding the compensation of our NEOs. In 2022, 96.7% of the shares voted on the say-on-pay proposal were voted "for" the proposal. Following this year’s say-on-pay vote, subject to shareholders' vote results on Proposal 3 on the frequency of future advisory votes on NEO compensation, we expect the next such vote will be at Bunge’s 2024 annual meeting of shareholders. See Proposal 3 on page 71 of this proxy statement for additional information on the say-on-pay frequency vote.Our common shares tradecompensation philosophy is to pay-for-performance, support our business goals, align the interests of management and our shareholders, and offer competitive compensation arrangements to attract, retain and motivate high-caliber executives. Our Human Resources and Compensation Committee regularly reviews our executive compensation program to ensure alignment with our business strategy and compensation philosophy. Additionally, our executive compensation program has been designed to appropriately balance risks and rewards and discourage excessive risk-taking by our executives.
For the reasons highlighted above, and more fully discussed in the CD&A, the Board unanimously recommends that shareholders vote in favor of the following advisory resolution:
"RESOLVED, that the shareholders approve the compensation of the NEOs as disclosed pursuant to Item 402 of Regulation S- K, including the CD&A, the accompanying compensation tables and related narrative disclosure in this Proxy Statement."
You may vote "for" or "against" this proposal, or you may abstain from voting. Although the vote on this Proposal 2 is advisory and non-binding, the Human Resources and Compensation Committee and the Board will review the voting results on the New York Stock Exchange under the ticker symbol "BG". On [●], the last full trading day before we announced the Redomestication, Bunge-Bermuda common shares closed at $[●] per share. Shareholders are encouraged to obtain recent stock quotes for Bunge-Bermuda common shares. We intend to fileproposal and will consider shareholder views in connection with our executive compensation program.
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| R | OUR BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE APPROVAL OF THE NON-BINDING ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION. |
Bunge | 2023 Proxy Statement 38
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| COMPENSATION DISCUSSION AND ANALYSIS |
This Compensation Discussion and Analysis (CD&A) provides an application with the New York Stock Exchange to list the Bunge-Switzerland shares that holdersoverview of Bunge-Bermuda common shares will receive in the Redomestication. Following completionour executive compensation program and an analysis of the Redomestication, Bunge-Switzerland shares will trade on the New York Stock Exchange under the symbol “BG.”
(b) Approximate Number of Holders of Common Stock
To our knowledge, based on information provided by Computershare Investor Services LLC, our transfer agent, as [●], 2022, we had [●] Bunge-Bermuda common shares issued and outstanding, which were held by approximately [●] registered holders.
(c) Dividends
Bunge-Bermuda has historically paid dividends to holders of its common shares on quarterly basis, and Bunge-Switzerland expects to continue to pay cash distributions to holders of Bunge-Switzerland common shares on a quarterly basis. Any future determination to pay distributions will, subjectdecisions made with respect to the provisions of applicable law, be at the discretioncompensation of our Board and will depend upon then existing conditions, includingNamed Executive Officers (NEOs) in 2022.
Named Executive Officers
For 2022, our financial condition, results of operations, contractual and other relevant legal or regulatory restrictions, capital requirements, business prospects and other factors our Board deems relevant. Following the Redomestication, future declaration and payment of Bunge-Switzerland distributions will be subject to shareholder approval.
NEOs were as follows:
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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | | | Name | Title as of December 31, 2022 |
| | | | |
| | | Gregory Heckman | Chief Executive Officer |
| | | | |
| | | | |
| | | John Neppl | Chief Financial Officer |
| | | | |
| | | | |
| | | Christos Dimopoulos | Co-President, Agribusiness |
| | | | |
| | | | |
| | | Julio Garros | Co-President, Agribusiness |
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| | | | |
| | | Joseph Podwika | Chief Legal Officer |
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| COMMITMENT TO SHAREHOLDERS |
Shareholder Engagement
Strong governance, driven by best practice and feedback from shareholders. We annually submit our executive compensation program to a shareholder advisory say-on-pay vote. We value the opinions of our shareholders as expressed through this vote and other communications. Through our robust engagement outreach program, we receive valuable feedback on the issues that are most important to our shareholders, including our executive compensation program, governance, sustainability, director skills and diversity, corporate responsibility and our business and strategic direction. Similar to previous years, our non-employee Board Chair and members of our senior management team engaged with institutional investors representing approximately 40 - 50% of our issued and outstanding shares annually.
39 Bunge | 2023 Proxy Statement
2022 Say-on-Pay Vote
At our 2022 Annual General Meeting, 96.7% of the votes cast on our annual say-on-pay vote were in favor of our executive compensation program. We attribute this favorable support to our continued engagement with shareholders, as well as the Human Resources and Compensation Committee's consideration of competitive market practices, and its goal of linking executive pay and performance. The following features of our compensation programs continued in 2022:
•Distinct metrics in the short-term and long-term incentive plans
◦Short-term incentive plan: Funded based on Adjusted Profit Before Taxes before certain incentive payouts (Adj PBT(I)), then modified by objectives driven by operational performance, Environmental, Social and Governance (ESG) and Human Capital Management (HCM) goals
◦Long-term incentive plan: Targets for performance-based restricted stock units set according to our externally stated goals for Earnings per Share (EPS) and Adjusted Return on Invested Capital (AROIC), which accounts for mark-to-market timing differences and adjusts for readily marketable inventories
•Long-term incentives heavily weighted (60%) toward equity awards tied to performance
•Relative Total Shareholder Return (RTSR) as a modifier for performance-based restricted stock units
In 2017, we last held a shareholder vote on the frequency of future say-on-pay votes. The Board recommended holding an annual say-on-pay vote and over 90% of shares voted were voted in favor of holding such a vote. We intend to continue to hold an annual say-on-pay vote unless shareholders advise us to change the frequency of the vote at the 2023 annual meeting of shareholders.
Pay and Performance
Performance drives pay. The Human Resources and Compensation Committee actively monitors the relationship between pay and performance, and strives to maintain a strong relationship between the two.
| | | | | | | | | | | | | | |
| Bunge's executive compensation philosophy is built upon a strong foundation of linking pay with performance | | Align the interests of executives with long-term interests of shareholders | | The majority of each executive's pay opportunity is delivered in the form of performance-based incentives with multi-year vesting |
| | | |
| | | |
| Drive business goals and strategies | | Incentive plan targets are directly tied to strategic business goals and initiatives, and are based upon metrics that drive long-term value creation |
| | | |
| | | |
| Reward profitable growth and increased shareholder value | | Performance metrics balance earnings growth and returns on investment and the pay mix delivers a majority of pay through equity, resulting in realized compensation in-line with the creation of long-term shareholder value |
In 2022, we continued to have performance-based ESG and HCM goals as a component of the annual incentive bonuses paid to our executive team and over 5,500 of our employees. The resulting payout is directly impacted by our attainment of certain diversity and sustainability targets.
In addition, we are committed to clarity of compensation disclosures and maintaining strong compensation governance practices to support the pay-for-performance principles of our executive compensation program. Our culture closely aligns the program with the interests of our shareholders.
Bunge | 2023 Proxy Statement 40
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| WHAT WE DO | | WHAT WE DON'T DO |
| | | | |
| P | We Do award 60% of target total compensation for other NEOs on average and 76% for our CEO in long-term equity-based incentives | | O | We Don't allow repricing of stock options or buy out underwater stock options without shareholder approval |
| P | We Dohave long-term incentives that are majority performance-based | | O | We Don't have single trigger change of control provisions |
| P | We Do use multiple performance metrics for short-term and long-term awards | | O | We Don't have golden parachute excise tax gross ups |
| P | We Do have comprehensive disclosure of metrics and goals following each performance period | | O | We Don't allow hedging or pledging of Company shares or holding company shares in margin accounts |
| P | We Do have robust share ownership guidelines for directors, executive officers and other senior leaders | | O | We Don't allow transactions by directors, officers and Company insiders in Company stock without pre-clearance |
| P | We Doconduct an annual compensation risk assessment for employee incentive plans | | O | We Don't have excessive executive perquisites |
| P | WeDo have a clawback policy | | | |
Pay Structure and Highlights
Highly performance leveraged and focused on long-term equity incentives.In furtherance of aligning our executive compensation program with shareholders' interests, it is our practice to deliver the majority of NEO compensation in the form of performance-based equity awards with multi-year vesting. In addition, we have a longstanding history of delivering the majority of long-term incentives in performance-based restricted stock units (PBRSUs) that are only earned upon achievement of pre-established financial statementsgoals. For 2022, a large portion of the long-term incentive mix continued to be tied to performance-based awards: 60% PBRSUs and 40% time-based restricted stock units (TBRSUs) for all NEOs. The Human Resources and Compensation Committee reviews this mix annually.
Key Elements of 2022 Executive Compensation
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| Pay Element | | Pay Philosophy | | Components | | Performance Link |
| | | | | | | | |
| Base Salary | | Varies based on experience, skill level, individual contributions and geographic circumstances | | Cash | | Sustained individual performance |
| | | | | | | | |
Annual Incentive Plan (AIP)(1) | | Driven by achievement of the company and individual performance against strategic priorities | | Cash | | Bunge Financial Performance | | Adj PBT(I)
+/- Scorecard Objectives Modifier |
| | | |
| | | |
| | | | | |
| | | Individual / Strategic Goal |
| | | | | | | | |
Long-Term Incentive Plan
("LTIP") | | Aligns interests of executives with shareholders and drives achievement of sustained long-term value creation | | PBRSUs | | 3-Year Cumulative EPS |
| | | | | |
| | | 3-Year Average AROIC |
| | | | | |
| | | 3-Year RTSR (Modifier) |
| | | | | |
| | | Stock Price Appreciation |
| | | |
| | TBRSUs | |
(1)In lieu of the AIP, Mr. Dimopoulos is eligible for the annual Risk Management & Optimization Award (RM&O) incentive award. Details regarding the RM&O incentive award are set forth on page 49 of this proxy statement. 41 Bunge Limited| 2023 Proxy Statement
Target Mix of Executive Compensation
Our CEO’s target total compensation (base salary, target annual cash incentive and target value of equity awards at grant) includes a mix of pay that is heavily weighted to long-term, equity-based incentives (76%). On average, our NEOs other than our CEO have 60% of total compensation targeted to be paid in long-term, equity-based incentives.
| | | | | | | | | | | |
| Base Salary | Annual Cash Incentive | Long-Term Equity Based Incentive |
CEO Target Total Compensation Mix(1) | 9% | 15% | 76% |
| | |
| | |
| | 91% Variable |
| | | | | | | | | | | |
| Base Salary | Annual Cash Incentive | Long-Term Equity Based Incentive |
Other NEO Target Total Compensation Mix(1) | 21% | 19% | 60% |
| | |
| | |
| | 79% Variable |
(1) Base salary, target annual cash incentive and target value of equity awards at grant.
Role of the Human Resources and Compensation Committee
Ensure strong governance and adherence to pay for performance principles. The Human Resources and Compensation Committee is composed entirely of non-employee independent directors and is responsible for the governance of our executive compensation program, including but not limited to designing, reviewing and overseeing administration of the program. Each year, the Human Resources and Compensation Committee reviews and approves all compensation decisions relating to the NEOs. Generally, all decisions with respect to determining the amount or form of NEO compensation are made by the Human Resources and Compensation Committee in accordance with the methodology described below.
When making compensation decisions, the Human Resources and Compensation Committee analyzes data from the comparator groups described on page 44 of this proxy statement. In addition, the Human Resources and Compensation Committee also considers several factors that it deems important in setting target total direct compensation for each NEO: •Individual responsibilities, experience and achievements of the NEO and potential contributions towards our performance;
•Input and recommendations from the independent compensation consultant;
•Recommendations from the CEO and CHRO (for officers other than themselves); and
•Relationship between pay and performance against the peer group.
The differences in target compensation levels among our NEOs are primarily attributable to the differences in the median range of compensation for similar positions in the comparator groups and the factors described above.
Bunge | 2023 Proxy Statement 42
Role of Executive Officers
Assist in executing on our pay for performance strategy. The CEO assists the Human Resources and Compensation Committee in setting the strategic direction of our executive compensation program, evaluates the performance of the NEOs (excluding himself) and makes recommendations to the Human Resources and Compensation Committee regarding their compensation in consultation with the CHRO. Although it gives significant weight to the CEO's recommendations, the Human Resources and Compensation Committee retains full discretion in making compensation decisions. The CEO is not present during the deliberations on his compensation. The CEO and the CHRO also participate in developing and recommending the performance criteria and measures for our NEOs under our annual and equity incentive plans for consideration by the Human Resources and Compensation Committee.
No other executive officers participated in the executive compensation process for 2022. Our human resources department, under the supervision of the CHRO, also supports the Human Resources and Compensation Committee in its work and implements our executive compensation program.
Role of Independent Compensation Consultant
Provide independent advice toward the fulfillment of the Human Resources and Compensation Committee's mission. Pursuant to its charter, the Human Resources and Compensation Committee is empowered to hire outside advisors as it deems appropriate to assist in the performance of its duties. The Human Resources and Compensation Committee has sole authority to retain or terminate any such advisors and to approve their fees.
The Human Resources and Compensation Committee has retained Semler Brossy Consulting Group (Semler Brossy) as its independent compensation consultant to provide information, analysis and objective advice regarding our executive compensation program. Management has no role in the Human Resources and Compensation Committee selecting Semler Brossy. The Human Resources and Compensation Committee periodically meets with Semler Brossy to review our executive compensation program and discuss compensation matters. For 2022, Semler Brossy performed the following functions at the Human Resources and Compensation Committee's request:
•Assisted the Human Resources and Compensation Committee in its review and assessment of the peer group for the purpose of providing competitive market information for the design of executive compensation programs;
•Compared each element of the NEOs' target total direct compensation opportunity with the corresponding compensation elements for the comparator groups to assess competitiveness;
•Prepared an analysis of pay and performance relative to the peer group to support the Human Resources and Compensation Committee's goal of aligning our executive compensation program with shareholders' interests;
•Prepared the compensation risk assessment in relation to our executives;
•Advised the Human Resources and Compensation Committee on competitive pay practices for non-employee director compensation;
•Prepared presentations for the Human Resources and Compensation Committee on general U.S. trends and practices in executive compensation;
•Supported the Human Resources and Compensation Committee in its review of this CD&A; and
•Advised the Human Resources and Compensation Committee on the design of executive incentive programs and arrangements.
The Human Resources and Compensation Committee reviews its relationship with Semler Brossy annually. The process includes a review of the quality of the services provided, the fee structure for the services, and the factors impacting Semler Brossy's independence under the rules of the SEC and the listing standards of the NYSE. In February
43 Bunge | 2023 Proxy Statement
2023, the Human Resources and Compensation Committee concluded that no conflict of interest exists that would prevent Semler Brossy from independently advising the Human Resources and Compensation Committee.
Competitive Market Positioning
Opportunities to earn superior pay for superior performance. We use various methods to determine the elements of our executive compensation program and review current compensation practices and levels. Our executive compensation program strives to provide a mix of base salary, target annual cash incentive awards and target annual long-term equity-based incentive award values (referred to, in aggregate, as target total direct compensation) that is aligned with the program's principles and objectives and is competitive with compensation provided by a peer group of selected publicly traded companies.
The Human Resources and Compensation Committee, in consultation with its independent compensation consultant, Semler Brossy, selects several peer companies having one or more of the following characteristics:
| | | | | | | | | | | | | | |
| Peer Group Composition | | 2022 Peer Group (n=16) |
| | | | |
| Industry | | •Agricultural, Chemicals, Fertilizers •Food Processing •Raw Materials •Logistics/Distribution | | •Alcoa Corporation •Archer-Daniels-Midland Company •Conagra Brands, Inc. •Corteva, Inc. •Dow Inc. •General Mills, Inc. •Ingredion Incorporated •International Paper Company •Kellogg Company •The Mosaic Company •Nutrien Ltd. •PPG Industries, Inc. •Sysco Corporation •Tyson Foods, Inc. •US Foods Holding Corp. •WestRock Company |
| | | |
| Revenue | | •Revenue targeted between 0.2 to 1.5x Bunge •Preference for companies with more than 25% of revenue generated outside the United States | |
| | | |
| Market Capitalization | | •Market Capitalization targeted between 0.5 to 3.0x Bunge | |
Bunge has few direct competitors, so we have built a peer group comprised of companies in relevant and adjacent industries that have similar global operations, scale and are of similar size to Bunge. These peers generally represent companies from which Bunge may attract talent and, therefore, provide the best comparison for the purpose of determining appropriate compensation levels.
The ratio of market capitalization relative to revenue in commodities-based businesses such as ours regularly results in our placing in the top quartile in revenue and at approximately the lower quartile in market capitalization within our peer group.
Bunge position (I) vs. 2022 Peer Group
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 0 | | | | 25 | | | | 50 | | | | 75 | | | | 100 |
| | | | | | | | | | | | | | | | | | | | | | |
Revenue(1) | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | 91st Percentile | |
| | | | | | | | | | | | | | | | | | | | | | |
Market Capitalization(1) | | | | | | | | | | | | | | | | | | | | | | |
| | 30th Percentile | | | | | | | | | | | |
(1)Based on publicly available data for the peer group as of December 31, 2022.
The Human Resources and Compensation Committee periodically reviews the composition of the peer group and, as appropriate, updates it to ensure continued relevance and to reflect mergers, acquisitions or other business-related changes that may occur. The following changes were made to the peer group for 2022: (i) Air Products and Chemicals, Inc. and FedEx Corporation were removed as these companies have become outsized in comparison to Bunge; and (ii) Ingredion Incorporated was added as a reasonably comparable U.S.-based agricultural company. These changes to the
Bunge | 2023 Proxy Statement 44
peer group will ensure we maintain an adequate number of peers to establish a robust data set and better balance the composition of revenue and market capitalization among the peers.
In determining NEO compensation, the Human Resources and Compensation Committee reviews a market analysis prepared by Semler Brossy, which includes equally weighted general industry and peer group compensation data provided by Willis Towers Watson and McLagan. This data enables the Human Resources and Compensation Committee to compare the competitiveness of NEO compensation based on their individual responsibilities and scope against comparable positions within our peer group and a broader general industry group of public companies. We refer to the peer group and other data sources collectively as the "comparator groups."
As an initial guideline, the Human Resources and Compensation Committee generally seeks to set target total direct compensation levels for the NEOs at levels that are competitive with the median of the comparator groups. Our executive compensation program retains the flexibility to set target total direct compensation above or below the median of the comparator groups in the Human Resources and Compensation Committee's reasonable discretion to recognize factors such as market conditions, job responsibilities, experience, skill sets and ongoing or potential contributions to Bunge. In addition, actual compensation earned in any annual period may be at, above, or below the median depending on the individual's and Bunge's performance for the year.
| | |
| PRINCIPAL ELEMENTS OF OUR EXECUTIVE COMPENSATION PROGRAM |
Base Salary
Compensation for responsibilities, skill and experience. A portion of annual cash compensation is paid as base salary to provide NEOs with a competitive level of pay for the execution of their key responsibilities. Base salaries for the NEOs are reviewed on an annual basis, and in connection with a promotion, individual performance or other change in responsibilities. The Human Resources and Compensation Committee establishes base salaries for the NEOs based on several factors, including:
•Evaluation of the executive's scope of responsibilities;
•Experience, contributions, skill level and pay compared to comparable executives in the comparator groups;
•Input and recommendations from Semler Brossy; and
•Recommendations from the CEO, in consultation with the Chief Human Resources Officer, for each NEO, other than the CEO.
For 2022, Mr. Neppl received a base salary increase as a result of a review of target total direct compensation compared to market in the comparator groups. Mr. Dimopoulos also received a base salary increase as a result of a market comparison against new benchmark data in the comparator groups relative to his new role as Co-President, Agribusiness. Our CEO, Mr. Heckman, did not receive a base salary increase in 2022. There is no set schedule for base salary increases. Salary increases are periodically provided based on competitive factors or in connection with an increase in responsibilities. Base salaries are generally targeted at approximately the median level for comparable executives in the comparator groups. The Human Resources and Compensation Committee set the base salaries of the NEOs in 2022 as follows:
45 Bunge | 2023 Proxy Statement
| | | | | | | | | | | |
| Executive | Base Salary
(as of 12/31/2021) | Base Salary (as of 12/31/2022) | Percentage Increase |
| Gregory Heckman | $1,200,000 | $1,200,000 | 0% |
| John Neppl | $700,000 | $750,000 | 7% |
Christos Dimopoulos(1) | $649,620 | $757,890 | 17% |
Julio Garros(2)(3) | N/A | $666,256 | N/A |
Joseph Podwika(3) | N/A | $600,000 | N/A |
(1)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
(2)Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022.
(3)Base salary data as of 12/31/2021 was not included for Messrs. Garros and 2020,Podwika as they were not NEOs during 2021.
The base salary earned by each NEO is set forth in the "Salary" column of the Summary Compensation Table on page 59 of this proxy statement. Annual Incentive Plan
Drive achievement of short-term progress toward long-term value creation.The Human Resources and Compensation Committee provides certain NEOs an opportunity to earn cash incentive awards under our Annual Incentive Plan (AIP), an annual, performance-based incentive plan that is directly related to the achievement of overall Company financial and predetermined strategic measures, aligned with our long-term strategy and goals. This same plan is available to a broad group of employees.
Target annual cash incentive award opportunities under the AIP are established by the Human Resources and Compensation Committee using analyses of comparable executives in the comparator groups and based on a percentage of each respective NEO's base salary. The Human Resources and Compensation Committee generally sets target annual cash incentive opportunities to be competitive with the median level for comparable executives in the comparator groups.
The following target annual incentive awards were established for the NEOs in 2022:
| | | | | | | | |
| Executive | 2022 Target Annual Incentive Percent of Base Salary | 2022 Target Annual Incentive Award Opportunity |
| Gregory Heckman | 170% | $2,040,000 |
| John Neppl | 100% | $750,000 |
Christos Dimopoulos(1) | N/A | N/A |
Julio Garros(2) | 100% | $666,256 |
| Joseph Podwika | 75% | $450,000 |
(1)Mr. Dimopoulos participates in the RM&O incentive and, therefore, is not eligible for the AIP.
(2)Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022.
For 2022, the target annual incentive award opportunity for our CEO, Mr. Heckman, increased from 160% to 170% as a result of a review of his target total direct compensation compared to other CEOs in the comparator group. No other NEO received an increase in target annual incentive award opportunity for 2022. The actual annual incentive awards earned by each NEO may be above, at, or below the established target level based on Bunge's financial performance and the respective NEO's individual performance goals attained for the relevant year. In order to receive a partial incentive award under the AIP, a threshold level must be attained before a payout is made. Incentive opportunities are also subject to caps on the amounts that can be earned. For 2022, Messrs. Heckman, Neppl and Garros were eligible to receive a payout ranging from 0% to 240%, and for Mr. Podwika 0% to 235%, of their target annual incentive award opportunity shown in the far-right column in the table above. In order to earn a maximum payout, both financial and individual performance must be achieved at maximum levels of 250% and 200% of target, respectively.
Bunge | 2023 Proxy Statement 46
For 2022, the Human Resources and Compensation Committee established the following performance weightings for NEOs under the AIP:
| | | | | | | | | | | | | | |
| Executive | | Financial Performance | | Individual Performance |
| | | |
| Adj PBT(I) +/- Modifiers | | Strategic Objectives |
| Gregory Heckman | | 80% | | 20% |
| John Neppl | | 80% | | 20% |
Christos Dimopoulos(1) | | N/A | | N/A |
| Julio Garros | | 80% | | 20% |
| Joseph Podwika | | 70% | | 30% |
(1)Mr. Dimopoulos participates in the RM&O incentive and, therefore, is not eligible for the AIP.
Financial Performance
Maintain focus on One Bunge and overall Company performance. For 2022, we once again operated under our funding approach for the annual incentive plan. The funding approach calculates a share of profit that is then allocated based on the individual incentive targets for each of the three yearsmore than 5,500 employees in the period endedplan. The funding approach is intended to remove a significant portion of variability in pay outcomes and align with overall results for shareholders. The main funding mechanism is Adj PBT(I). This may then be modified up or down by the scorecard objectives, which are driven by operational performance and ESG and HCM goals.
The AIP funding rate is evaluated annually by the Human Resources and Compensation Committee and set at a level that ensures 1) the range of outcomes is competitive to market, including payouts consistent with standard levels of probability, 2) no payout is generated unless cost of capital is achieved and 3) the target payout is aligned with our externally stated baseline earnings. The AIP funding rate for 2022 was set at 3.5% of Adj PBT(I), +/- 1.5% based on the modifiers, as established by the Human Resources and Compensation Committee on February 18, 2022.
| | | | | | | | | | | | | | | | | |
3.5%
Adj PBT(I) | +/- | 1.5%
Modifier | Focus Area | Scorecard Objectives | |
| Operational Performance & Financial Discipline | Quality of earnings relative to internal and external benchmarks | |
| People & Purpose | Increase diversity at leadership levels | |
| Achievement of Sustainability Index | |
The modifiers are quantifiable targets designed to advance progress in key strategic areas. In determining the impact of the modifiers, the Human Resource and Compensation Committee considered the following:
•Quality of earnings relative to internal and external benchmarks — working capital usage; structural versus positioning results; and earnings mix
◦In 2022, the Company performed beyond what was expected given the market conditions, resulting in a positive modifier
•Increase in diversity at the leadership level — retain, attract and develop female and/or ethnically diverse employees at director level and above
◦In 2022, we retained our diverse talent while continuing to drive an inclusive culture through diverse talent attraction and development. Overall, the outcome of our targets was neutral, resulting in no impact to the modifier
•Achievement of Sustainability Index — Scope 1 & 2 CO2 emissions reduction; palm oil traceability to plantation; and soy traceability to farm
◦In 2022, all three sustainability targets were exceeded, resulting in a positive modifier
47 Bunge | 2023 Proxy Statement
Based on these accomplishments, The Human Resources and Compensation Committee certified the following actual results on February 1, 2023:
| | | | | | | | | | | | | | |
| Funding Mechanism | | | Funding Rate |
| | | | |
| Adj PBT(I) | | | 3.50% |
| Modifier (Scorecard Objectives) | | | |
| Operational Performance & Financial Discipline | Quality of earnings | | +0.30% |
| People & Purpose | Increase in diversity at the leadership level | | — |
| Achievement of Sustainability Index | | +0.50% |
| | | | |
| | Final Funding Rate | | 4.30% |
Once the final funding rate is determined, it is multiplied by the Adj PBT(I) to come up with the total funding amount. This amount is divided by the Aggregate AIP Financial Performance Target, which is the sum of the total payout under the financial performance measure if each of the AIP participants were to achieve target payout based on their respective percent of base salary.
| | | | | | | | | | | | | | | | | | | | |
| Adj PBT(I) | x | Final Funding Rate | ÷ | Aggregate AIP
Financial Performance Target | = | Payout of Financial Performance |
The following table shows the implied Adj PBT(I) that would have resulted in Threshold, Target and Maximum payouts of the financial performance for the 2022 AIP with the 4.30% Final Funding Rate applied (dollar amounts are in millions of USD):
| | | | | | | | | | | | | | |
| Performance Metric | Threshold (30% Payout) | Target (100% Payout) | Maximum (250% Payout) | Actual |
| | | | |
Implied Adj PBT(I)(1) | $308 | $1,028 | $2,570 | $2,543 |
| | | | |
| | Payout of Financial Performance | 247% |
(1) Based on an Aggregate AIP Financial Performance Target of $44M |
Amounts used to determine performance of financial results are derived from our audited financial statements. Under the terms of the AIP, the Human Resources and Compensation Committee may adjust actual results achieved, in its discretion, if it determines that such adjustment is appropriate to reflect unusual, unanticipated or non-recurring items or events. Consistent with past practice and according to pre-established principles, in calculating payouts for 2022 AIP awards, the Human Resources and Compensation Committee chose to exclude certain gains and charges as disclosed in our earnings release filed on Form 8-K on February 8, 2023. These gains and charges were associated with (1) losses resulting from the Ukraine-Russia war, (2) impairment and severance charges on the classification as held-for-sale of our Russian oilseed processing business, (3) gain related to the settlement of one of our international defined benefit pension plans, (4) tax expense on the sale of our wheat milling business in Mexico, and (5) interest expenses in connection with the early bond redemption of our 4.35% unsecured senior notes.
Individual Performance
Reward successful execution of strategic initiatives. In addition to financial performance, each NEO was evaluated on the achievement of individual performance objectives that relate to the achievement of specific aspects of our business plans and strategies, as well as other initiatives relating to the NEO's position.
The individual performance component of the awards provides the Human Resources and Compensation Committee an opportunity to reward NEOs for achievement of performance objectives that drive overall Company success. These
Bunge | 2023 Proxy Statement 48
objectives are reviewed and approved by the Human Resources and Compensation Committee at the beginning of each year. For 2022, the individual objectives for our NEOs were aligned to three focus areas:
•Operational Performance & Financial Discipline — enable transparency of key performance indicators and completion of rewiring initiatives, and efficient operating working capital usage to maximize earnings;
•Growth — develop future value creation streams for digital and carbon, year-on-year growth with strategic customers and deliver milestones on origination strategy; and
•People & Purpose — reduce altering lost time injuries, enable delivery of ESG milestones (sustainability and human rights), attract diverse hires, continue to improve employee engagement and develop succession plans for all leadership positions.
2022 Annual Incentive Award Determinations
The Human Resources and Compensation Committee reviews and approves the annual incentive awards based on audited results of the financial performance and the achievement of individual performance objectives, as described above. The Human Resources and Compensation Committee seeks to set rigorous, but achievable, goals at the beginning of the year and evaluates preliminary payouts at year-end to ensure appropriate alignment of pay and performance.
The table below sets forth the actual annual incentive awards paid to each NEO for performance achieved in 2022:
| | | | | | | | |
| Executive | 2022 Calculated Award Percent of Target | 2022 Actual Award Total Value |
| Gregory Heckman | 233% | $4,745,040 |
| John Neppl | 228% | $1,707,000 |
Christos Dimopoulos(1) | N/A | N/A |
Julio Garros(2) | 238% | $1,583,024 |
| Joseph Podwika | 210% | $946,800 |
(1)Mr. Dimopoulos participates in the RM&O incentive and, therefore, is not eligible for the AIP.
(2)Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2021, incorporated by reference2022.
The actual amount awarded to each NEO is also set forth in the "Non-Equity Incentive Plan Compensation" column of the Summary Compensation Table on page 59 of this proxy statementstatement. Annual Risk Management & Optimization Incentive Awards
Mr. Dimopoulos had responsibility for optimizing the financial contribution derived from managing the related physical and financial flows within our Agribusiness segment. This financial contribution results from optimizing the risk created from managing the timing differences of procuring from farmers when they are willing to sell and selling to customers when they are ready to buy. Accordingly, he participated in a separate performance-based annual cash incentive award opportunity in 2022—the RM&O incentive award.
| | | | | | | | | | | | | | |
| Executive | | Financial Performance | | Risk Management & Optimization |
| | | |
| Adj PBT(I) +/- Modifiers | | Risk Adjusted Profit |
Gregory Heckman(1) | | N/A | | N/A |
John Neppl(1) | | N/A | | N/A |
| Christos Dimopoulos | | 50% | | 50% |
Julio Garros(1) | | N/A | | N/A |
Joseph Podwika(1) | | N/A | | N/A |
(1)Messrs. Heckman, Neppl, Garros and Podwika participate in the AIP and, therefore, are not eligible for the RM&O incentive.
49 Bunge | 2023 Proxy Statement
A portion of this award opportunity reflects the role as executive leader in contributing to the overall success of the Company and is linked directly to the achievement of the same financial performance results as described for the AIP above: Adj PBT(I), modified by our achievement of scorecard objectives. The remainder of this award opportunity reflects the direct impact of Mr. Dimopoulos on the earnings from trading, merchandising and positioning to maximize the earnings at risk in our asset base. The performance metric used for the RM&O incentive award is Risk Adjusted Profit, which we define as the aggregate contribution generated from optimizing the physical and financial flows of our Agribusiness value chains after applying working capital and risk capital charges to take into account the quality of earnings generated relative to the amount of capital utilized during the year. The award opportunity is intended to align the compensation we provide for Mr. Dimopoulos with the compensation provided to comparable executives in commodity-based environments in the comparator groups. The award is subject to a minimum level of performance that must be achieved before a payout under the award will occur. The award is also subject to a maximum for which the payout may not exceed. The following target RM&O incentive award was established by the Human Resources and Compensation Committee in 2022:
| | | | | | | | |
| Executive | 2022 Target RM&O Percent of Base Salary | 2022 Target RM&O Award Opportunity |
Gregory Heckman(1) | N/A | N/A |
John Neppl(1) | N/A | N/A |
Christos Dimopoulos(2) | 125% | $947,362 |
Julio Garros(1) | N/A | N/A |
Joseph Podwika(1) | N/A | N/A |
(1)Messrs. Heckman, Neppl, Garros and Podwika participate in the AIP and, therefore, are not eligible for the RM&O incentive.
(2)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
For 2022, target RM&O award opportunity for Mr. Dimopoulos decreased from 300% to 125% of his base salary as a result of the shift in his responsibilities. The actual annual incentive award earned may be above, at, or below the established target level based on Bunge's financial performance and the effectivenessRM&O performance attained for the relevant year. Incentive opportunities are also subject to caps on the amounts that can be earned. For 2022, Mr. Dimopoulos was eligible to receive a payout ranging from 0% to 250% of his target RM&O award opportunity shown in the far-right column in the table above.
2022 RM&O Award Determinations
The Human Resources and Compensation Committee reviews and approves the RM&O incentive award based on the results achieved against the audited financials and risk metrics as described above. The Human Resources and Compensation Committee seeks to set rigorous, but achievable, goals at the beginning of the year and evaluates payouts at year-end to ensure appropriate alignment of pay and performance. The actual performance against RM&O goals are not disclosed as the Human Resources and Compensation Committee believes that disclosure could cause competitive harm to the Company.
In order to drive long-term value creation and ensure results are sustainable, the Human Resources and Compensation Committee requires that a portion of the RM&O incentive award payout be deferred over a three-year period and be at risk based on future performance of the Agribusiness value chains. The deferral is eligible to be paid out in three annual installments commencing on the first anniversary of the grant date of the units, subject to reduction or forfeiture in the event of: (i) a cumulative annual risk management loss for the respective value chains during the deferral period; (ii) an executive's voluntary resignation of employment; or (iii) an executive's termination of employment by the Company for "cause."
Bunge | 2023 Proxy Statement 50
The table below sets forth the actual RM&O incentive award paid for performance achieved in 2022:
| | | | | | | | | | | | | | | | | | | | |
| Payout for 2022 Actual RM&O | | | Payout Mix for 2022 Actual RM&O |
| Executive | Percent of Target | Total Value | | | Paid | Deferred |
| | | | | | |
Gregory Heckman(1) | N/A | N/A | | | N/A | N/A |
John Neppl(1) | N/A | N/A | | | N/A | N/A |
Christos Dimopoulos(2) | 248% | $2,354,196 | | | $1,762,094 | $592,102 |
Julio Garros(1) | N/A | N/A | | | N/A | N/A |
Joseph Podwika(1) | N/A | N/A | | | N/A | N/A |
(1)Messrs. Heckman, Neppl, Garros and Podwika participate in the AIP and, therefore, are not eligible for the RM&O incentive.
(2)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
The actual amount awarded is also set forth in the "Non-Equity Incentive Plan Compensation" column of the Summary Compensation Table on page 59 of this proxy statement. Long-Term Incentive Plan
Aligns majority of pay with shareholder interests.The long-term equity-based incentive element of our executive compensation program is designed to incentivize actions that will drive sustainable, long-term value creation by providing NEOs with a continuing stake in our long-term success and to serve as an important component of retention. We further emphasize equity ownership by senior executives through the share ownership guidelines described on page 56 of this proxy statement. Pursuant to the Equity Incentive Plan, the Human Resources and Compensation Committee primarily grants long-term incentive awards to NEOs in the form of PBRSUs and TBRSUs that vest upon continued service over a specified period of time.
Grants are generally made in the first quarter of each year, when compensation decisions for the year are made and after the public release of our year-end audited financial results. In limited, special situations, equity awards may be granted at other times in the event of a new hire, promotion, for retention purposes or to recognize exceptional performance.
The mix of long-term incentives for the 2022 annual grant cycle for the NEOs was 60% PBRSUs and 40% TBRSUs.
The Human Resources and Compensation Committee targets the value of the long-term incentive awards granted to the NEOs to provide total compensation opportunities that approximate the median of comparable executives in the comparator groups. The Human Resources and Compensation Committee also considers the following factors in determining the type and amount of long-term incentive awards:
•feedback from shareholder engagement;
•input and recommendation from its independent compensation consultant;
•potential shareholder dilution;
•share overhang (defined as the number of shares available for grant, plus outstanding stock option and restricted stock unit awards);
•run rate (defined as the number of shares granted divided by the number of common shares issued and outstanding); and
•projected cost and accounting expense on our earnings.
51 Bunge | 2023 Proxy Statement
In 2022, the Human Resources and Compensation Committee granted the following long-term incentive award amounts to NEOs: | | | | | |
| Executive | 2022 Total LTIP Target Value |
| Gregory Heckman | $10,600,000 |
| John Neppl | $2,500,000 |
| Christos Dimopoulos | $2,000,000 |
| Julio Garros | $2,000,000 |
| Joseph Podwika | $1,500,000 |
In determining the number of units granted in 2022, the Human Resources and Compensation Committee used the average of the high and low prices of our common shares on the date of grant to align the value of the grant with the number of shares granted on a specific date. The actual amount awarded to each NEO is also set forth in the "Stock Awards" and "Option Awards" columns of the Summary Compensation Table on page 59 of this proxy statement. Performance-Based Restricted Stock Unit Awards
Reward achievement of long-term value drivers, EPS and AROIC, and stock price appreciation.PBRSUs are tied to our long-term performance to ensure that NEO pay is directly linked to the achievement of sustained long-term operating performance. Reflective of the desire to balance earnings growth and efficient use of capital, the Human Resources and Compensation Committee has chosen to measure performance in an equal mix of three-year cumulative EPS and three-year average AROIC for Bunge as a whole, with a relative TSR (RTSR) modifier. AROIC is used to account for mark-to-market timing differences and adjust for readily marketable inventories. The Human Resources and Compensation Committee considers EPS and AROIC key drivers of shareholder value and fundamental to long-term value creation.
On February 18, 2022, the Human Resources and Compensation Committee approved the grant of PBRSUs to the NEOs for the 2022-2024 performance period. Payouts of the PBRSUs, if any, will generally be subject to the NEO's continued employment through the vesting date (generally, the third anniversary of the grant date) and will be based (i) 50% on our achievement of cumulative EPS targets and (ii) 50% on our achievement of average AROIC targets established by the Human Resources and Compensation Committee on the grant date. Once the achievement of the financial targets has been calculated, up to an additional 25% may be added or subtracted from the results depending on Bunge's three-year performance relative to the S&P 500 Industrials comparator group. In the event that the RTSR would result in a positive modifier, but Total Shareholder Return of Bunge Limited’s internal controlis negative over the three-year period, the RTSR modifier will not be applied. In no event will the RTSR modifier result in an overall PBRSU achievement greater than the maximum payout attached to the award, which for the 2022 grant is 200% of the award target. Upon vesting, each PBRSU is settled with a Bunge common share. In addition, dividend equivalents are paid in our common shares on the date that PBRSUs are otherwise paid out, based on the number of shares vesting. However, in no event will dividend equivalents be paid on any shares in excess of the target award granted.
In setting the 2022-2024 targets, the Human Resources and Compensation Committee considered multiple factors, including:
•our externally stated goals;
•investor expectations;
•peer and broader market historical performance;
•industry economic factors;
•our historical and potential performance; and
•typical distributions of payouts over time.
The resulting EPS and AROIC targets are established at levels that are intended to incentivize achievement of our long-term strategic plans and the continuous improvement of returns above our cost of capital.
Bunge | 2023 Proxy Statement 52
Given our policy to not provide specific earnings guidance, performance targets for the 2022-2024 cycle are not disclosed prior to the end of the performance period as the Human Resources and Compensation Committee believes that disclosure would cause competitive harm to the Company.
As mentioned above, the Human Resources and Compensation Committee targeted to deliver 60% of the value of the 2022 long-term incentive award in PBRSUs. Information regarding the fair market value and number of PBRSUs that the NEOs may earn at the end of the 2022-2024 performance period, subject to satisfaction of the performance metrics described above, is shown in the Grants of Plan Based Awards Table on page 61 of this proxy statement. 2020-2022 PBRSU Award Determinations. Each year, following the end of a three-year PBRSU performance cycle, the Human Resources and Compensation Committee reviews and certifies the performance attained based on our reported audited financial reportingstatements, subject to the Human Resources and Compensation Committee's discretion under the Equity Incentive Plan to adjust such results for unusual, unanticipated or non-recurring items and events. In February 2023, the Human Resources and Compensation Committee reviewed and certified achievement of the performance metrics for the PBRSUs granted on March 10, 2020 for the 2020-2022 performance period. Fifty percent of the 2020-2022 awards vest based on three-year cumulative diluted EPS from continuing operations and 50% on three-year average Return on Invested Capital (ROIC), unadjusted.
Based on the Human Resources and Compensation Committee's determination that performance was at the levels set forth in the table below, PBRSUs were paid out at 200% of awarded target for the 2020-2022 performance period:
| | | | | | | | | | | | | | | | | |
| Performance Metric | Threshold (30%) | Target (100%) | Maximum (200%) | Actual(1) | Results |
| | | | | |
| EPS | $6.89 | $11.49 | $18.38 | $32.18 | 200% |
| ROIC | 6.0% | 6.4% | 7.4% | 13.3% | 200% |
| | | | | |
| Weighted average payout of performance metrics | 200% |
(1)Adjusted for the same gains and charges as the Annual Incentive Plan, as described above.
Time-Based Restricted Stock Unit Awards
Reward stock price appreciation and continued service. For 2022, the Human Resources and Compensation Committee granted TBRSUs with 40% weighting for all NEOs to promote alignment with shareholder interests as the ultimate value received will be a function of stock price performance. TBRSUs also help us maintain competitive compensation levels and retain executive talent through a multi-year vesting schedule. TBRSUs generally vest in full on the third anniversary of the date of grant.
On February 18, 2022, the Human Resources and Compensation Committee approved the grant of TBRSUs to the NEOs effective March 15, 2022. Information regarding the grant date fair value and the number of TBRSUs awarded to each NEO is set forth in the Grants of Plan Based Awards Table on page 61 of this proxy statement. Retirement and Executive Benefits
Competitively address basic health, welfare and retirement income needs. We provide employees with a wide range of retirement and other employee benefits that are designed to assist in attracting and retaining employees critical to our long-term success and to reflect the competitive practices of the companies in the peer group. U.S.-based NEOs are eligible for retirement benefits under the following plans: (i) Bunge Retirement Savings Plan; (ii) Bunge Excess Contribution Plan; (iii) Bunge Supplemental Excess Contribution Plan; and (iv) Bunge Deferred Compensation Plan. Each non-U.S.-based NEO is eligible to participate in a statutory retirement plan that covers substantially all employees who are employed in the country where the NEO is based. Amounts contributed by Bunge to such plans are set forth in the "All Other Compensation" column of the Summary Compensation Table on page 59 of this proxy statement. Our executive compensation program also provides NEOs with limited perquisites and personal benefits. The Human Resources and Compensation Committee, in consultation with Semler Brossy, periodically reviews the benefits provided to the NEOs to ensure competitiveness with market practices.
53 Bunge | 2023 Proxy Statement
Retirement Savings Plan
Each U.S.-based NEO is eligible to participate in the Bunge Retirement Savings Plan—a tax qualified retirement plan that covers substantially all U.S.-based salaried and non-union hourly employees. Participants may contribute up to 50% of their compensation on a before-tax basis into their 401(k) Plan accounts. We match an amount equal to 100% for each dollar contributed by participants on the first 3% of their regular earnings and 50% for each dollar contributed on the next 2% of their regular earnings. In addition, we contribute a fixed contribution of 5% of base salary, bonus and any overtime to their 401(k) each year.
As the 401(k) Plan is a tax-qualified retirement plan, the Internal Revenue Code limits the "additions" that can be made to a participant's 401(k) plan account each year (for 2022, $67,500 including catch-up contributions). "Additions" include Company matching contributions and before-tax contributions made by a participant. In addition, the Internal Revenue Code limits the amount of annual compensation that may be taken into account in computing benefits under the 401(k) Plan. In 2022, this compensation limit was $305,000. Participants may direct the investment of their 401(k) Plan accounts into several investment alternatives, including a Bunge common share fund.
Excess Contribution Plan
Participants in the 401(k) Plan, including the U.S.-based NEOs, are eligible to participate in the Bunge Excess Contribution Plan—a non-tax-qualified defined contribution plan that is designed to restore retirement benefits that cannot be paid from the 401(k) Plan due to Internal Revenue Code limits.
The benefit provided under the excess contribution plan is equal to the difference between the benefit that would have been auditedearned under the 401(k) Plan, without regard to any Internal Revenue Code limits, and the actual benefit provided under the 401(k) Plan. A participant's account balance is credited with the same investment return as the investment alternatives he or she selected under the 401(k) Plan (including the Bunge common share fund).
Payments are made from our general assets in a lump sum cash payment following a participant's termination of employment, subject to applicable restrictions set forth in Section 409A of the Internal Revenue Code.
Supplemental Excess Contribution Plan
In addition, each U.S.-based NEO is eligible to participate in the Bunge Supplemental Excess Contribution Plan—an unfunded, non-tax-qualified defined contribution plan that is designed to supplement retirement benefits for designated employees. The Human Resources and Compensation Committee of the Board designates those key employees who are eligible to participate in the supplemental excess contribution plan.
The benefit provided under the supplemental excess contribution plan will equal an amount determined as follows: the participant’s compensation multiplied by Deloitte & Touche LLP,eight percent, less the maximum amount of employer contributions available to be credited to such participant’s accounts for such calendar year under the Bunge Retirement Savings Plan and the Bunge Excess Contribution Plan or their successor plans. For this purpose, the maximum amount of employer contributions includes: the maximum matching contributions allowed under such other plans and the non-matching employer contributions made on the participant’s behalf under such other plans. A participant's account balance is credited with the same investment return as the investment alternatives he or she selected under the 401(k) Plan (including the Bunge common share fund).
Payments are made from our general assets in a lump sum cash payment following a participant's termination of employment, subject to applicable restrictions set forth in Section 409A of the Internal Revenue Code.
Company matching contributions allocated to the NEOs under the Bunge Excess Contribution Plan and Bunge Supplemental Excess Contribution Plan are shown in the "All Other Compensation Total" column of the Summary Compensation Table on page 59 of this proxy statement. Deferred Compensation Plan
We also maintain the Bunge Deferred Compensation Plan—a non-tax-qualified deferred compensation plan that is designed to provide participants with an independent registered public accounting firm, as statedopportunity to defer receipt of current income into the future on a tax-deferred basis. For 2022, none of our NEOs, including the CEO, participated in their reports. Such financial statements are incorporated by reference in reliance upon the reports of such firm given their authority as experts in accounting and auditing.
deferred compensation plan.
70Bunge | 2023 Proxy Statement 54
Eligible employees who meet the minimum base salary level may participate in the deferred compensation plan. For 2022, the minimum base salary level required to participate in the deferred compensation plan was $305,000. The deferred compensation plan allows participants to voluntarily defer from 1% to 10% of their base salary and up to 100% of their annual incentive compensation and PBRSUs. Gains and losses are credited based on a participant's election of a variety of deemed investment choices.
Subject to the applicable restrictions set forth in Section 409A of the Internal Revenue Code, a participant may elect to defer receipt of income for any period not less than 36 months from the date of deferral and will receive a distribution of his or her account following the end of his or her elected deferral period or death. Subject to applicable restrictions set forth in Section 409A of the Internal Revenue Code, participants may elect to receive payment of their deferred account balance in a lump sum or in up to 15 annual installments. Distributions of a participant's account are made in cash and from our general assets.
Health and Welfare Plans
Active employee benefits such as medical, dental, life insurance and disability coverage are available to U.S. employees through our flexible benefits plan. Employees contribute toward the cost of the flexible benefits plan by paying a portion of the premium costs on a pre-tax basis. Long-term disability coverage can be paid on a pre- or post-tax basis at the employee's option.
Perquisites and Executive Benefits
It is the Human Resources and Compensation Committee's practice to limit special perquisites and executive benefits provided to the Company's executives. The Human Resources and Compensation Committee periodically reviews the perquisites provided to our executive officers under our executive compensation program. Under the current policy, we provide U.S.-based executive officers, including the NEOs, with a limited annual perquisite allowance of $9,600. Non-U.S. NEOs are provided with an automobile allowance in accordance with Company programs and local market practices.
Severance and Change of Control Benefits
Focus executives on shareholder interests during periods of uncertainty.Our executive compensation program is designed to provide for the payment of severance benefits to our NEOs upon certain types of employment terminations. Providing severance and change of control benefits assists us in attracting and retaining executive talent and reduces the personal uncertainty that executives are likely to feel when considering a corporate transaction. These arrangements also provide valuable retention incentives that encourage executives to complete such transactions, thus enhancing long-term shareholder value.
The NEOs are provided with severance benefits under the Executive Severance Plan, which includes change of control severance protections. Specifically, it contains a "double trigger" vesting requirement for the payment of severance benefits, meaning that both (1) a change of control must occur, and (2) the NEO's employment must also be terminated under certain specified circumstances before they are entitled to any severance payment. All unvested equity awards are also subject to double trigger vesting upon a change of control. The Executive Severance Plan includes a 24-month non-competition and non-solicitation covenant in the case of change of control. Neither our Executive Severance Plan nor other compensation arrangements provide for a golden parachute excise tax gross up.
The terms of Executive Severance Plan are set forth under the Potential Payments Upon Termination of Employment or Change of Control table beginning on page 64 of this proxy statement.
55 Bunge | 2023 Proxy Statement
The Human Resources and Compensation Committee maintains and is committed to a policy of strong corporate governance. The principal governance elements of our executive compensation program are described in further detail below.
Executive Compensation Recoupment Policy
Mitigate unnecessary risk-taking that may have adverse impact on Bunge. The Human Resources and Compensation Committee has adopted a recoupment policy ("clawback") with respect to executive compensation. The policy provides that, if the Board or an appropriate committee thereof determines that an executive officer or other senior executive has engaged in any fraud or misconduct that caused or was a significant contributing factor to having to restate all or a portion of its financial statement(s), the Board or committee shall take such actions as it deems appropriate to remedy the misconduct and prevent its recurrence.
The actions that may be taken against a particular executive include:
•requiring reimbursement of any bonus or incentive compensation paid to the executive;
•causing the cancellation of any equity-based awards granted to the executive; and
•seeking reimbursement of any gains realized on the disposition or transfer of any equity-based awards, if and to the extent that, (i) the amount of compensation was calculated based upon the achievement of certain financial results that were subsequently reduced due to a restatement, (ii) the executive engaged in fraud or misconduct that caused or significantly contributed to the restatement and (iii) the amount of the compensation that would have been awarded to or received by the executive had the financial results been properly reported would have been lower than the amount actually awarded or received.
Any recoupment under this policy is in addition to any other remedies that may be available to Bunge under applicable law. We are in the process of reviewing the policy to ensure compliance with the final clawback rule adopted by the Securities and Exchange Commission and with the rule making adopted by the New York Stock Exchange.
Share Ownership Guidelines
Ensure appropriate level of long-term wealth tied to shareholder returns. To further align the interests of senior management with our shareholders, the Board maintains share ownership guidelines that require executive officers to hold significant amounts of our common shares. Executive officers are expected to meet minimum ownership guidelines by April 30 following the fifth anniversary of the date the executive is hired or appointed to a covered title, as applicable. The guideline applicable to senior executives is based on a multiple of base salary.
•CEO – 6x base salary
•Other NEOs – 3x base salary
•Other Senior Executives - 2x base salary
The Human Resources and Compensation Committee reviews the progress of the NEOs toward meeting the ownership guidelines annually. In the event of financial hardship or other good cause, the Human Resources and Compensation Committee may approve exceptions to the share ownership guidelines as the Human Resources and Compensation Committee deems appropriate. For a description of the ownership guidelines applicable to our non-employee directors, see "Director Compensation" on page 33 of this proxy statement. The following count towards meeting the ownership guideline: (i) shares beneficially owned by the executive directly or indirectly and (ii) 50% of the value of unvested TBRSUs. Unvested and vested unexercised stock options do not count toward achievement of the guidelines, along with unearned PBRSUs.
Bunge | 2023 Proxy Statement 56
Executive officers, including the NEOs, are required to hold a minimum of 50% of the shares net of taxes acquired through long-term incentive plans (including stock options, PBRSUs and TBRSUs) until the guidelines are met. If the initial ownership period has lapsed, and the minimum ownership guideline is not met, executive officers are required to hold 100% of net shares acquired until the guideline is met. Compliance with the executive share ownership guidelines is reviewed annually. As of December 31, 2022, all NEOs have satisfied the share ownership guidelines.
To further encourage a long-term commitment to our sustained performance, executive officers are prohibited from hedging, pledging or using their common shares as collateral for margin loans.
Tax Deductibility of Compensation
Section 162(m) of the Internal Revenue Code (and the regulations promulgated thereunder) precludes a public corporation from taking an income tax deduction for compensation exceeding $1 million payable in any year to the corporation’s chief executive officer and other “covered employees,” as defined in Section 162(m). Prior to January 1, 2018, an exception to this deduction limit was available for “performance-based” compensation that was approved by shareholders and otherwise satisfied certain requirements under Section 162(m). As a result of the enactment of U.S. tax reform legislation, the performance-based compensation exception is no longer available for taxable years beginning after December 31, 2017, unless such compensation qualifies for certain transition relief for binding written contracts that were in effect on November 2, 2017. The tax reform legislation also expanded the definition of “covered employees” to include the CFO and certain former NEOs who were disclosed in our proxy statement after January 1, 2017.
While our executive compensation program has sought to maximize the tax deductibility of compensation payable to the NEOs to the extent permitted by law, the Human Resources and Compensation Committee retained the flexibility and discretion to make compensation decisions that are based on factors other than Section 162(m) when necessary or appropriate (as determined by the Human Resources and Compensation Committee in its sole discretion) to enable Bunge to continue to retain, attract, reward and motivate its highly-qualified executives. The Human Resources and Compensation Committee does not intend to change the pay-for-performance approach of our executive pay program due to the enactment of tax reform.
We believe our compensation programs are designed to establish an appropriate balance between risk and reward in relation to our overall business strategy. To that end, the Human Resources and Compensation Committee has conducted a compensation risk assessment, with the assistance of management and Semler Brossy, the Human Resources and Compensation Committee's independent compensation consultant. Semler Brossy prepared a risk assessment of the executive programs while management prepared an assessment of all other compensation programs used by the Company.
The Human Resources and Compensation Committee largely focused its assessment on our executive compensation program, as these are the employees whose actions are most likely to expose us to significant business risk. The relevant features of the executive compensation program that mitigate risk are as follows:
•The program utilizes annual and long-term financial performance goals that are tied to key measures of short-term and long-term performance that drive shareholder value, and targets are set with a reasonable amount of stretch that should not encourage imprudent risk-taking.
•The Human Resources and Compensation Committee sets target awards under the executive compensation program following the receipt of advice and benchmarking analysis provided by Semler Brossy.
•The annual incentive and long-term equity-based compensation program awards are tied to several performance metrics to reduce undue weight on any one measure.
•The annual incentive program's performance metric targets a share of profit to align with overall results for shareholders while maintaining performance orientation through scorecard factors and individual performance allocations.
57 Bunge | 2023 Proxy Statement
•The use of non-financial performance factors in determining the actual payout of annual incentive compensation serves as a counterbalance to the quantitative performance metric.
•The executive compensation program is designed to deliver a significant portion of compensation in the form of long-term incentive opportunities, which focuses executives on our long-term success and discourages excessive focus on annual results.
•The equity incentive program uses a mix PBRSUs and TBRSUs that vest over several years to ensure that employees are focused on maximizing long-term shareholder value and financial performance and to mitigate the risks associated with the exclusive use of stock price-based awards.
•The performance metrics for the PBRSUs are based on overall Bunge performance over a three-year period, reducing incentives to maximize one segment's results and focusing on sustainable performance over a three-year cycle rather than any one year.
•Maximum awards that may be paid out under the annual incentive and equity incentive programs are subject to appropriate caps and the Human Resources and Compensation Committee retains the discretion to reduce payouts under the plans.
•We have adopted share ownership guidelines that further align the long-term interests of executives with those of our shareholders, as well as restrictions on hedging, holding our common shares in a margin account and using our common shares as collateral for loans, which seek to discourage a short-term stock price focus.
•We have adopted an executive compensation recoupment policy for senior executives, as discussed in "Executive Compensation Recoupment Policy" on page 56 of this proxy statement. The Human Resources and Compensation Committee reviewed and discussed the findings of the risk assessment and believes that our compensation programs are appropriately balanced and do not motivate employees to take risks that are reasonably likely to have a material adverse effect on Bunge.
| | |
| HUMAN RESOURCES AND COMPENSATION COMMITTEE REPORT |
The Human Resources and Compensation Committee has reviewed and discussed the preceding "Compensation Discussion and Analysis" with management. Based on such review and discussions, the Human Resources and Compensation Committee recommended to the board that this Compensation Discussion and Analysis be included in this proxy statement for the year ended December 31, 2022.
Members of the Human Resources and Compensation Committee
J. Erik Fyrwald, Chair
Bernardo Hees
Kenneth Simril
Henry "Jay" Winship
Bunge | 2023 Proxy Statement 58
| | |
| EXECUTIVE COMPENSATION TABLES |
Summary Compensation Table
The following table sets forth the compensation of our CEO, our CFO and the other three most highly compensated executive officers who were serving as executive officers as of December 31, 2022.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Name and Position Held | Year | Salary ($) (1) | | Bonus
($) | | Stock Awards ($)(2)(3) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(4) | | Change in Pension Value & Nonqualified Deferred Compensation Earnings ($)(5) | All Other Compensation Total ($)(6) | | Total ($)(7) |
| Gregory Heckman | 2022 | $1,200,046 | | $— | | $11,480,361 | $— | $4,745,040 | | $— | $474,244 | | $17,899,691 |
| Chief Executive Officer | 2021 | $1,200,046 |
| $— | | $9,991,055 | $— | $4,608,000 | | $— | $349,126 | | $16,148,227 |
| 2020 | $1,200,046 | | $— | | $3,891,160 | $2,698,150 | $4,608,000 | | $— | $128,086 |
| $12,525,442 |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| John Neppl | 2022 | $737,528 | | $— | | $2,707,599 | $— | $1,707,000 | | $— | $200,002 | | $5,352,129 |
| Chief Financial Officer | 2021 | $700,027 | | $— | | $1,990,250 | $— | $1,645,000 | | $— | $116,766 | | $4,452,043 |
| 2020 | $700,027 | | $— | | $1,240,040 | $216,445 | $1,680,000 | | $— | $73,170 | | $3,909,682 |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Christos Dimopoulos | 2022 | $730,823 | (8) | $— | | $3,702,366 | $— | $2,354,196 | (8) | $— | $137,683 | (8) | $6,925,068 |
| Co-President, Agribusiness | 2021 | $655,500 | | $— | | $2,373,493 | $— | $4,326,357 | | $— | $94,687 | | $7,450,037 |
| 2020 | $679,560 | | $— | | $973,602 | $106,740 | $4,077,360 | | $— | $96,158 | | $5,933,420 |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Julio Garros | 2022 | $570,525 | (9) | $— | | $2,165,962 | $— | $1,583,024 | (9) | $— | $21,652 | (9) | $4,341,163 |
| Co-President, Agribusiness | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| Joseph Podwika | 2022 | $593,750 | | $— | | $1,624,448 | $— | $946,800 | | $— | $126,325 | | $3,291,323 |
| Chief Legal Officer | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
(1)Actual salary payments during 2022. Annual base salary rates as of December 31, 2022 are described on page 45 of this proxy statement. (2)The amounts shown reflect the aggregate full grant date fair value for equity awards for financial reporting purposes in accordance with ASC Topic 718 (without any reduction for risk of forfeiture) as determined based on applying the assumptions used in Bunge's audited financial statements. See Note 27 to the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2022 regarding assumptions underlying the valuation of equity awards. Amounts reported for these awards may not represent the amounts that the listed officers ultimately realize from the awards. Whether, and to what extent, a listed officer realizes value will depend on our actual operating performance, stock price fluctuations and the listed officer's continued employment.
(3)Based on the full grant date value of the PBRSUs granted on March 15, 2022, the following are the maximum payouts, assuming the maximum level of performance is achieved: Mr. Heckman: $14,732,589; Mr. Neppl: $3,474,373; Mr. Dimopoulos: $2,779,155; Mr. Garros: $2,779,155; and Mr. Podwika: $2,084,428. For additional information on these awards, see "Long-term Incentive Plan" beginning on page 51 of this proxy statement. (4)Incentive compensation awards under the AIP for the 2022 fiscal year that were paid in March 2023. In lieu of the awards under the AIP for 2022, Mr. Dimopoulos received an RM&O incentive award in connection with his service to our Agribusiness segment as described in more detail under “Annual Risk Management & Optimization Incentive Awards” on page 49 of this proxy statement. (5)None of the NEOs participate in Bunge's U.S. pension plan. There are no above market or preferential earnings with respect to nonqualified deferred compensation arrangements.
59 Bunge | 2023 Proxy Statement
(6)The following table provides details about each component of the "All Other Compensation" column:
| | | | | | | | | | | | | | | | | |
| Name | Registrant Contributions for Qualified Plans ($) | Registrant Contributions for Nonqualified Plan ($) | Tax Gross-Ups ($) | Perquisites and Other Personal Benefits ($)(a) | Total
($) |
| Gregory Heckman | $26,100 | $438,544 | $— | $9,600 | $474,244 |
| John Neppl | $26,100 | $164,302 | $— | $9,600 | $200,002 |
Christos Dimopoulos(b) | $114,297 | $— | $— | $23,386 | $137,683 |
Julio Garros(c) | $— | $— | $— | $21,652 | $21,652 |
| Joseph Podwika | $26,100 | $90,625 | $— | $9,600 | $126,325 |
| | | | | |
(a) For Messrs. Heckman, Neppl and Podwika, represents $9,600 annual perquisite allowance. For Messrs. Dimopoulos and Garros, represents an automobile allowance in connection with their overseas employment. (b) Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022. (c) Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022. |
(7)As required by SEC rules, "Total" represents the sum of all columns in the table.
(8)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
(9)Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022.
Bunge | 2023 Proxy Statement 60
Grants of Plan Based Awards Table
The following table sets forth information with respect to awards under our Annual Incentive Plan, Risk Management & Optimization incentive program and Long-Term Incentive Plan for the fiscal year ended December 31, 2022.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | All Other Stock Awards: Number of Shares or Units
(#) | Closing Price on Grant Date
($) | Grant Date Fair Value of Stock and Option Awards (3) ($) |
| Name | Threshold
($) | Target
($) | Maximum
($) | | Threshold
(#) | Target
(#) | Maximum
(#) |
| Gregory Heckman | | | | | | | | | | | |
| 2022 AIP | | $122,400 | $2,040,000 | $4,896,000 | | | | | | | |
| 2022 LTIP—PBRSUs | 3/15/2022 | | | | | 8,851 | 59,009 | 118,018 | | $108.06 | $7,240,404 |
| 2022 LTIP—TBRSUs | 3/15/2022 | | | | | | | | 39,339 | $108.06 | $4,239,957 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| John Neppl | | | | | | | | | | | |
| 2022 AIP | | $45,000 | $750,000 | $1,800,000 | | | | | | | |
| 2022 LTIP—PBRSUs | 3/15/2022 | | | | | 2,087 | 13,917 | 27,834 | | $108.06 | $1,707,616 |
| 2022 LTIP—TBRSUs | 3/15/2022 | | | | | | | | 9,278 | $108.06 | $999,983 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Christos Dimopoulos | | | | | | | | | | | |
2022 RM&O(4)(5) | | $142,104 | $947,362 | $2,368,405 | | | | | | | |
2021 RM&O—Deferral(5) | 3/15/2022 | | | | | | | | 14,255 | $108.06 | $1,536,404 |
| 2022 LTIP—PBRSUs | 3/15/2022 | | | | | 1,669 | 11,133 | 22,266 | | $108.06 | $1,366,019 |
| 2022 LTIP—TBRSUs | 3/15/2022 | | | | | | | | 7,422 | $108.06 | $799,943 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Julio Garros | | | | | | | | | | | |
2022 AIP(6) | | $39,975 | $666,256 | $1,599,014 | | | | | | | |
| 2022 LTIP—PBRSUs | 3/15/2022 | | | | | 1,669 | 11,133 | 22,266 | | $108.06 | $1,366,019 |
| 2022 LTIP—TBRSUs | 3/15/2022 | | | | | | | | 7,422 | $108.06 | $799,943 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Joseph Podwika | | | | | | | | | | | |
| 2022 AIP | | $40,500 | $450,000 | $1,057,500 | | | | | | | |
| 2022 LTIP—PBRSUs | 3/15/2022 | | | | | 1,252 | 8,350 | 16,700 | | $108.06 | $1,024,545 |
| 2022 LTIP—TBRSUs | 3/15/2022 | | | | | | | | 5,566 | $108.06 | $599,903 |
(1)Represents the range of annual cash incentive award opportunities under our AIP and RM&O incentive awards (as applicable). The minimum potential payout for each of the listed officers was zero. For AIP, the threshold award represents, for Messrs. Heckman, Neppl and Garros, 6% of the target award value, and for Mr. Podwika, 9% of the target award value (that is, the result if only the lowest weighted metric met the threshold) and the maximum award represents, for Messrs. Heckman, Neppl and Garros, 240% of the target award value, and for Mr. Podwika, 235% of the target award value (that is, the result if the highest weighted metric achieves a maximum 250% and the lowest weighted metric achieves a maximum of 200%). For RM&O incentive awards, the threshold award represents 15% of the target award value (that is, the result if only the lowest weighted metric met the threshold) and the maximum award represents 250%. The performance period began on January 1, 2022 and ended on December 31, 2022. For additional discussion, see "Annual Incentive Plan" on page 46 of this proxy statement and "Annual Risk Management & Optimization Incentive Awards" on page 49 of this proxy statement.. (2)Represents the range of shares that may be released at the end of the January 1, 2022 – December 31, 2024 performance period for PBRSUs awarded under the 2016 Equity Incentive Plan. The minimum potential payout for each of the listed officers under the PBRSUs is zero. The threshold award represents 15% of the target award value (that is, the result if only the lowest weighted metric met the threshold) and the maximum award represents 200% of the target award value. Payment of the award is subject to the achievement of certain financial metrics during the performance period. For additional discussion, see "Long-Term Incentive Plan" starting on page 51 of this proxy statement. (3)This column shows the full grant date fair value of PBRSUs and TBRSUs under ASC Topic 718. Generally, the full grant date fair value is the amount we would expense in our financial statements over the award's vesting period. See Note 27 to the audited consolidated financial statements in our Annual Report on Form 10-K regarding assumptions underlying valuation of equity awards.
(4)Represents the range of award opportunity under a performance incentive for achievement in the annual RM&O incentive award for Mr. Dimopoulos. Mr. Dimopoulos was awarded 50% of the risk component of $1,548,647, which was converted to restricted stock units on March 15, 2022 and will vest ratably on each March 15 of 2023, 2024 and 2025. These restricted stock units are at risk based on future performance of the Agribusiness value chains.
(5)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
(6)Amounts shown have been converted from Brazilian real to U.S. Dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022.
61 Bunge | 2023 Proxy Statement
Outstanding Equity Awards Table
The following table sets forth information with respect to all outstanding equity awards as of December 31, 2022.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Option Awards(1) | | | | Stock Awards(2) |
| Name | Date of Grant | | Number of Securities Underlying Unexercised Options Exercisable
(#) | Number of Securities Underlying Unexercised Options Unexercisable
(#) | Option Exercise Price
($) | Option Expiration Date | | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or other Rights That Have Not Vested
(#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or other Rights That Have Not Vested
($) |
| Gregory Heckman | 5/16/2019 | | 480,000 | — | $53.43 | 05/16/2029 | | | | | |
| 3/10/2020 | | 303,332 | 151,668 | $42.76 | 03/10/2030 | | | | | |
| 3/15/2021 | (3) | | | | | | | | 209,320 | $20,883,856 |
| 3/15/2022 | (4) | | | | | | | | 160,092 | $15,972,379 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| John Neppl | 3/10/2020 | (5) | 24,332 | 12,168 | $42.76 | 03/10/2030 | | | | 11,897 | $1,186,964 |
| 3/15/2021 | (3) | | | | | | | | 41,650 | $4,155,421 |
| 3/15/2022 | (4) | | | | | | | | 37,754 | $3,766,717 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Christos Dimopoulos | 3/05/2013 | | 1,800 | — | $74.33 | 03/04/2023 | | | | | |
| 2/28/2014 | | 2,700 | — | $79.47 | 02/27/2024 | | | | | |
| 2/27/2015 | | 3,450 | — | $81.68 | 02/26/2025 | | | | | |
| 3/01/2016 | | 5,300 | — | $50.07 | 03/01/2026 | | | | | |
| 3/08/2017 | | 6,500 | — | $81.00 | 03/08/2027 | | | | | |
| 2/28/2018 | | 5,800 | — | $75.99 | 02/28/2028 | | | | | |
| 3/12/2019 | | 18,500 | — | $51.89 | 03/12/2029 | | | | | |
| 3/10/2020 | (5) | 12,000 | 6,000 | $42.76 | 03/10/2030 | | | | 5,946 | $593,232 |
| 3/10/2020 | (6) | | | | | | | | 2,981 | $297,414 |
| 3/15/2021 | (3) | | | | | | | | 20,823 | $2,077,511 |
| 3/15/2021 | (7) | | | | | | | | 12,019 | $1,199,136 |
| 3/15/2022 | (4) | | | | | | | | 30,200 | $3,013,054 |
| 3/15/2022 | (8) | | | | | | | | 14,502 | $1,446,865 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Julio Garros | 2/28/2014 | | 3,300 | — | $79.47 | 02/27/2024 | | | | | |
| 2/27/2015 | | 3,750 | — | $81.68 | 02/26/2025 | | | | | |
| 3/01/2016 | | 6,500 | — | $50.07 | 03/01/2026 | | | | | |
| 3/08/2017 | | 4,700 | — | $81.00 | 03/08/2027 | | | | | |
| 2/28/2018 | | 5,800 | — | $75.99 | 02/28/2028 | | | | | |
| 3/12/2019 | | 7,700 | — | $51.89 | 03/12/2029 | | | | | |
| 3/10/2020 | (9) | | | | | | | | 2,492 | $248,627 |
| 3/15/2021 | (3) | | | | | | | | 9,675 | $965,275 |
| 3/15/2022 | (4) | | | | | | | | 30,200 | $3,013,054 |
| | | | | | | | | | | |
| | | | | | | | | | | |
| Joseph Podwika | 3/10/2020 | (5) | 15,000 | 7,500 | $42.76 | 03/10/2030 | | | | 7,569 | $755,159 |
| 3/15/2021 | (3) | | | | | | | | 26,546 | $2,648,494 |
| 3/15/2022 | (4) | | | | | | | | 22,649 | $2,259,691 |
(1)Represents unexercised options as of December 31, 2022. Options vested in one-third installments on the first, second and third anniversaries of their respective date of grant. All options have a 10-year term.
(2)Value of unvested restricted stock units using a share price of $99.77, the closing price of our common shares on December 31, 2022. PBRSUs for the 2020-2022 performance cycle are not included in the table, as they are considered earned as of December 31, 2022. Includes dividend equivalents accrued on outstanding restricted stock units.
(3)Payment amount of the PBRSUs will be determined as of December 31, 2023 based on satisfaction of performance targets for the 2021-2023 performance period. Awards are subject to continued service through the third anniversary of the date of grant. Assumes maximum performance is attained. TBRSUs that will vest in full on March 15, 2024, subject to continued service.
(4)Payment amount of the PBRSUs will be determined as of December 31, 2024 based on satisfaction of performance targets for the 2022-2024 performance period. Awards are subject to continued service through the third anniversary of the date of grant. Assumes maximum performance is attained. TBRSUs that will vest in full on March 15, 2025, subject to continued service.
(5)TBRSUs that will vest in full on March 10, 2023, subject to continued service.
Bunge | 2023 Proxy Statement 62
(6)TBRSUs that will vest 33% on each March 30 of 2021, 2022 and 2023, subject to recovery base on future performance of the Agribusiness line.
(7)PBRSUs that will vest 33% on each March 15 of 2022, 2023 and 2024, subject to recovery base on future performance of Agribusiness line.
(8)PBRSUs that will vest 33% on each March 15 of 2023, 2024 and 2025 subject to recovery base on future performance of Agribusiness line.
(9)TBRSUs that will vest 25%, 25%, and 50% on each March 10 of 2021, 2022 and 2023, subject to continued service.
Option Exercises and Stock Vested Table
The following table sets forth information with respect to the exercise of stock options during 2022 and vesting of restricted stock units during 2022.
| | | | | | | | | | | | | | | | | |
| Option Awards | | Stock Awards |
| Name | Number of Shares
Acquired on
Exercise
(#) | Value Realized
Upon Exercise
($)(1) | | Number of Shares Acquired on Vesting (#)(2) | Value Realized
Upon
Vesting
($) |
| Gregory Heckman | — | $— | | 198,204 | $18,530,687 |
| John Neppl | — | $— | | 44,323 | $4,257,344 |
| Christos Dimopoulos | 750 | $25,493 | | 34,497 | $3,460,105 |
| Julio Garros | 2,400 | $69,420 | | 12,484 | $1,206,316 |
| Joseph Podwika | — | $— | | 25,038 | $2,340,878 |
(1)The value realized upon exercise is calculated as the product of (a) the number of our common shares for which the stock options were exercised and (b) the excess of the market price of our common shares on the NYSE upon the exercise of the applicable stock option over the applicable exercise price per share of the stock option.
(2)Represents TBRSUs awarded in 2019 and 2020 that vested in whole or in part during 2022, PBRSUs awarded in 2020 with a performance period ended December 31, 2022 and Deferred RM&O performance shares awarded in 2021 that vested in whole or in part in 2022. The value realized upon vesting was determined by multiplying the number of shares vested by the market price of our common shares on the NYSE on the vesting date.
Pension Benefits Table
None of the Named Executive Officers, including the CEO, receive pension benefits as the Bunge U.S. Pension Plan and the Bunge U.S. Supplemental Executive Retirement Plan were closed to new hires effective December 31, 2017. They also do not receive benefits under the Bunge Excess Benefit Plan as it is only available to those whose benefits under the pension plan are limited by the Internal Revenue Code.
63 Bunge | 2023 Proxy Statement
Nonqualified Deferred Compensation Table
The following table sets forth certain information with respect to our nonqualified deferred compensation plans as of December 31, 2022.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Name | Plan Name | Executive
Contributions
in Last FY
($) | | Registrant
Contributions
in Last FY
($)(1) | | Aggregate
Earnings in Last FY
($) | | Aggregate
Withdrawals/
Distributions
($)(2) | | Aggregate
Balance at Last FYE
($) |
| Gregory Heckman | Excess Contribution Plan | $— | | $312,304 | | ($83,149) | | $— | | $597,102 |
| Supplemental Excess Contribution Plan | $— | | $126,240 | | ($23,370) | | $— | | $185,617 |
| John Neppl | Excess Contribution Plan | $— | | $120,902 | | ($52,146) | | $— | | $206,016 |
| Supplemental Excess Contribution Plan | $— | | $43,400 | | ($9,563) | | $— | | $47,262 |
Christos Dimopoulos(3) (4) | RM&O Deferral | $— | | $— | | $— | | $36,871 | | $36,878 |
Julio Garros(3) | N/A | $— | | $— | | $— | | $— | | $— |
| Joseph Podwika | Excess Contribution Plan | $— | | $69,853 | | ($10,885) | | $— | | $91,568 |
| Supplemental Excess Contribution Plan | $— | | $20,772 | | ($1,732) | | $— | | $19,040 |
(1)The amounts shown represent Company contributions under the Bunge Excess Contribution and Bunge Supplemental Excess Contribution Plans and are included in the "All Other Compensation" column of the Summary Compensation Table on page 59 of this proxy statement. (2)For Mr. Dimopoulos, includes a portion of the RM&O award for performance year 2019 that was mandatorily deferred and paid April 2022. The RM&O award is described in more detail under "Annual Risk Management & Optimization Incentive Awards" on page 49 of this proxy statement. (3)Mr. Dimopoulos and Mr. Garros are not eligible to participate in the nonqualified deferred compensation plans.
(4)Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
The Excess Contribution Plan, Supplemental Excess Contribution Plan and Deferred Compensation Plan are described under "Retirement and Executive Benefits" on page 53 of this proxy statement. Potential Payments Upon Termination of Employment or Change of Control
We have entered into a Participation Agreement under our Executive Severance Plan with each of our NEOs and maintain certain plans that will require us to provide compensation to the listed officers in the event of certain terminations of employment.
Executive Severance Plan
Under our Executive Severance Plan, we have participation agreements with each of the NEOs that includes change of control severance arrangements. The arrangements provide for severance benefits in the event that an executive’s employment is terminated by us or a successor without “cause” or by the executive for “good reason,” in each case before the second anniversary of a “change of control” of the Company, as those terms are defined in the agreements.
The Executive Severance Plan provides that, upon a qualifying termination, the executive would be entitled to a lump sum payment equal to (i) 24 months of the executive’s base salary in effect immediately prior to the termination date, and (ii) an amount equal to two times the executive’s annual target bonus for the year in which the termination occurs. In addition, each executive would be entitled to a prorated AIP award for the year in which the executive's employment is terminated based on the financial and individual performance achieved for the performance period.
The executive will be entitled to receive accelerated vesting of all outstanding equity awards, with any stock options remaining exercisable for the remainder of their full term, and with unvested performance-based equity awards deemed vested at the greater of (i) actual performance or (ii) target levels with respect to performance goals or other vesting criteria.
Bunge | 2023 Proxy Statement 64
As a condition to receiving the severance benefits, an executive must timely execute and deliver a general release of employment related claims against the Company in substantially the form attached to the Executive Severance Plan. Executives are bound by a 24-month non-competition and non-solicitation covenants. The Executive Severance Plan does not provide for a tax gross-up.
Equity Acceleration Under the Equity Incentive Plans
Under the 2009 Equity Incentive Plan and the 2016 Equity Incentive Plan, a participant's equity award will be subject to the following treatment upon a termination of employment (except as otherwise may be provided under an individual award agreement or employment agreement):
•In the event of a termination of employment due to death, disability or retirement (age 65 or age 55 with 10 years of service), an individual's stock options granted (i) under the 2009 Equity Incentive Plan will become fully vested and immediately exercisable and (ii) under the 2016 Equity Incentive Plan will vest pro rata through the date of termination. Disability has the same meaning as under our long-term disability plan for all awards except incentive stock options, for which disability means permanent and total disability within the meaning of Section 22(e)(3) of the Internal Revenue Code.
•In the event of a termination of employment without "cause," all stock options granted (i) under the 2009 Equity Incentive Plan that would have vested in the 12-month period following termination of employment will immediately vest and become exercisable and (ii) under the 2016 Equity Incentive Plan will vest pro rata through the date of termination.
Generally, for all terminations of employment other than for Cause or voluntary resignation, all TBRSU and PBRSU awards vest pro rata through the date of termination (for PBRSUs, subject to satisfaction of applicable performance goals and a minimum one-year service period).
Upon a change of control of the Company, outstanding equity awards under the 2009 Equity Incentive Plan and the 2016 Equity Incentive Plan will be subject to the terms and conditions of the Executive Severance Plan.
Estimated Payments Upon Termination of Employment or Change of Control
The potential amount of compensation payable to the listed officer in each situation is shown in the following table. The amounts assume that the respective termination of employment event occurred on December 31, 2022.
These amounts are estimates only and do not necessarily reflect the actual amounts that would be paid to the listed officers, which would only be known at the time that they become eligible for payment. The amounts are in addition to: (i) vested or accumulated benefits generally under our retirement plans and nonqualified deferred compensation plans, which are set forth in the disclosure tables above; (ii) benefits paid by insurance providers under life and disability insurance policies; and (iii) benefits generally available to U.S.-based salaried employees, such as accrued vacation.
Unless stated otherwise, the value of unvested and accelerated stock options shown in the tables below have been determined by multiplying (i) the number of unvested stock options that would have been accelerated by (ii) the difference between (x) the exercise price of the stock option and (y) $99.77, which was the closing price of our common shares on December 31, 2022. Likewise, the value of unvested restricted stock unit awards shown in the tables below have been determined by multiplying (i) the number of unvested restricted stock units that would have been accelerated by (ii) the closing price of our common shares on December 31, 2022.
65 Bunge | 2023 Proxy Statement
| | | | | | | | | | | | | | | | | |
| Name / Event of Termination | Cash Severance
($) | Continuation of Benefits
($) | Accelerated Vesting of Equity
($) | Excise Tax Gross-up or Cut-back
($) | Total ($)(1) |
Gregory Heckman(2)(7) | | | | | |
| Termination "For Cause" | $— | $— | $— | $— | $— |
| Termination "Without Cause" or "For Good Reason" | $6,480,000 | $27,822 | $19,413,486 | $— | $25,921,308 |
| Termination Related to Change of Control | $6,480,000 | $27,822 | $31,534,873 | $— | $38,042,695 |
| Death, Disability or Retirement | $— | $— | $24,956,152 | $— | $24,956,152 |
| | | | | |
| | | | | |
John Neppl(3)(7) | | | | | |
| Termination "For Cause" | $— | $— | $— | $— | $— |
| Termination "Without Cause" or "For Good Reason" | $1,500,000 | $41,999 | $4,127,570 | $— | $5,669,569 |
| Termination Related to Change of Control | $3,000,000 | $41,999 | $5,350,547 | $— | $8,392,546 |
| Death, Disability or Retirement | $— | $— | $5,350,547 | $— | $5,350,547 |
| | | | | |
| | | | | |
Christos Dimopoulos(4)(7) | | | | | |
| Termination "For Cause" | $— | $— | $— | $— | $— |
| Termination "Without Cause" or "For Good Reason" | $1,705,253 | $— | $3,549,296 | $— | $5,254,549 |
| Termination Related to Change of Control | $3,410,506 | $— | $6,024,000 | $— | $9,434,506 |
| Death, Disability or Retirement | $— | $— | $4,367,166 | $— | $4,367,166 |
| | | | | |
| | | | | |
Julio Garros(5)(7) | | | | | |
| Termination "For Cause" | $— | $— | $— | $— | $— |
| Termination "Without Cause" or "For Good Reason" | $1,332,512 | $— | $1,209,545 | $— | $2,542,057 |
| Termination Related to Change of Control | $2,665,024 | $— | $1,905,286 | $— | $4,570,310 |
| Death, Disability or Retirement | $— | $— | $1,905,286 | $— | $1,905,286 |
| | | | | |
| | | | | |
Joseph Podwika(6)(7) | | | | | |
| Termination "For Cause" | $— | $— | $— | $— | $— |
| Termination "Without Cause" or "For Good Reason" | $1,050,000 | $32,562 | $2,592,549 | $— | $3,675,111 |
| Termination Related to Change of Control | $2,100,000 | $32,562 | $3,350,384 | $— | $5,482,946 |
| Death, Disability or Retirement | $— | $— | $3,350,384 | $— | $3,350,384 |
(1)Total does not include vested amounts or accumulated benefits through December 31, 2022, including vested stock options, accumulated retirement benefits and amounts under deferred compensation plans, as those amounts are set forth in the disclosure tables above. PBRSUs for the 2020-2022 performance cycle and annual incentive awards for calendar year 2022 are not included in the table, as they are considered earned as of December 31, 2022. For disclosure purposes only, we have assumed that target performance measures were achieved for performance-based awards as of December 31, 2022.
(2)For the purposes of this table, Mr. Heckman's compensation for 2022 is as follows: base salary equal to $1,200,000 and a target annual bonus equal to $2,040,000.
(3)For purposes of this table, Mr. Neppl’s compensation for 2022 is as follows: base salary equal to $750,000 and a target annual bonus equal to $750,000.
(4)For purposes of this table, Mr. Dimopoulos’s compensation for 2022 is as follows: base salary equal to $757,890 and a target annual bonus equal to $947,362. Amounts shown have been converted from Swiss francs to U.S. dollars at the exchange rate of 1.0827 U.S. dollars per Swiss franc as of December 31, 2022.
(5)For purposes of this table, Mr. Garros's compensation for 2022 is as follows: base salary equal to $666,256 and a target annual bonus equal to $666,256. Amounts shown have been converted from Brazilian reals to U.S. dollars at the exchange rate of 0.1891 U.S. dollars per Brazilian real as of December 31, 2022.
(6)For the purposes of this table, Mr. Podwika's compensation for 2022 is as follows: base salary equal to $600,000 and a target annual bonus equal to $450,000.
(7)Pursuant to the Executive Severance Plan, if employment is terminated by the Company without “Cause” or he resigns for “Good Reason,” each NEO is entitled to a payment equal to 12 months (24 months for the CEO) of his then base salary, plus 12 months (24 months for the CEO) of his target AIP award.
Bunge | 2023 Proxy Statement 66
The pay ratio information is provided pursuant to Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(u) of Regulation S-K. We note that, due to our permitted use of reasonable estimates and assumptions in preparing this pay ratio disclosure, the disclosure may involve a degree of imprecision, and thus this pay ratio disclosure is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K. We have elected to identify our median employee every three years unless a significant change in our employee population or employee compensation arrangements has occurred.
The median employees remain unchanged from last year as there has been no change in our employee population or employee compensation arrangements that we reasonably believe would significantly impact our 2022 pay ratio disclosure. Similarly, there has been no change in our median employees’ circumstances that we reasonably believe would result in a significant change to our fiscal year 2022 pay ratio disclosure.
Median Employee to CEO Pay Ratio
For 2022, we calculated annual total compensation for the median employee using the same methodology as for our NEOs as described in the 2022 Summary Compensation Table on page 59 of this proxy statement. The annual total compensation for Mr. Heckman, our CEO, was $17,899,691 (the same amount as reported under the 2022 Summary Compensation Table above) and the median annual total compensation of all of our employees (other than our CEO), was $83,433 adjusted for cost of living. For the cost-of-living adjustment, we used the World Bank's Purchasing Power Parity conversion factor for GDP. This adjustment takes into account the local cost of an equivalent basket of goods, which embeds the exchange rate and inflation into the comparison such that the basket of goods is priced the same in both countries. Based on this information, our CEO's annual total compensation is 215 times that of the median of the annual total compensation of all employees.
In addition, the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all employees without any cost-of-living adjustment is 460 times the median employee. This is based on the foreign exchange rate as of December 31, 2022.
| | |
| PAY VERSUS PERFORMANCE DISCLOSURE |
The pay versus performance information is provided pursuant to Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K. The following table sets forth information regarding the compensation per the Summary Compensation Table (SCT) on page 59 of this proxy statement, the compensation actually paid (CAP) to our principal executive officer (PEO) and, on average, to our other NEOs (non-PEO NEOs) during the specified years, as calculated in accordance with the Pay Versus Performance (PvP) disclosure rule, and the Company's performance. | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year | Summary Compensation Table Total for PEO
($) | Compensation Actually Paid to PEO(1) ($) | Average Summary Compensation Table Total for Non-PEO NEOs(2) ($) | Average Compensation Actually Paid to Non-PEO NEOs(1)(2) ($) | Value of Initial Fixed $100 Investment Based On(3): | Net Income
($M) | Adjusted EPS ($)(5) |
Total Shareholder Return
($) | Industry Index Total Shareholder Return ($)(4) |
| 2022 | $17,899,691 | $36,869,068 | $4,977,421 | $6,799,877 | $190 | $137 | $1,610 | $13.91 |
| 2021 | $16,148,227 | $53,419,822 | $6,527,939 | $12,048,134 | $173 | $121 | $2,078 | $12.93 |
| 2020 | $12,525,442 | $36,032,900 | $5,882,927 | $10,231,847 | $119 | $105 | $1,145 | $8.30 |
(1)Compensation Actually Paid represents the Summary Compensation Table Total adjusted to (a) exclude any positive aggregate change in the actuarial present value of all defined benefit pension plan benefits for the applicable year and (b) include the fair value of current and prior year equity awards that are outstanding, vested or forfeited during the applicable year, instead of the grant date value of awards granted during the applicable year. The following tables show what amounts were deducted from, and added to, the Summary Compensation Table Total to calculate the PEO and Average Non-PEO NEO Compensation Actually Paid:
67 Bunge | 2023 Proxy Statement
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| PEO SCT Total to CAP Reconciliation |
| | | | | | | | | | | | | | |
| Year | Summary Compensation Table Total Compensation | | | Deductions | | | | Additions | | | Compensation Actually Paid |
| | Grant Date Fair Value of Stock and Option Awards(i) | Change in Pension Value & Nonqualified Deferred Compensation Earnings(ii) | | | | Fair Value at FYE of Stock and Option Awards(iii) | Change in Fair Value of Outstanding and Unvested Stock and Option Awards(iv) | Change in Fair Value of Vested Stock and Option Awards(v) | | |
| 2022 | $17,899,691 | - | | $11,480,361 | $— | | + | | $15,386,996 | $5,751,424 | $9,311,318 | | = | $36,869,068 |
| 2021 | $16,148,227 | | $9,991,055 | $— | | | $18,082,222 | $24,119,250 | $5,061,178 | | $53,419,822 |
| 2020 | $12,525,442 | | $6,589,310 | $— | | | $21,157,143 | $10,411,408 | $(1,471,783) | | $36,032,900 |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Average Non-PEO NEO SCT Total to CAP Reconciliation |
| | | | | | | | | | | | | | |
| Year | Summary Compensation Table Total Compensation | | | Deductions | | | | Additions | | | Compensation Actually Paid |
| | Grant Date Fair Value of Stock and Option Awards(i) | Change in Pension Value & Nonqualified Deferred Compensation Earnings(ii) | | | | Fair Value at FYE of Stock and Option Awards(iii) | Change in Fair Value of Outstanding and Unvested Stock and Option Awards(iv) | Change in Fair Value of Vested Stock and Option Awards(v) | | |
| 2022 | $4,977,421 | - | | $2,550,094 | $— | | + | | $3,264,413 | $663,074 | $445,063 | | = | $6,799,877 |
| 2021 | $6,527,939 | | $2,649,102 | $2,848 | | | $4,253,230 | $3,534,002 | $384,913 | | $12,048,134 |
| 2020 | $5,882,927 | | $1,528,073 | $100,767 | | | $3,689,683 | $2,152,985 | $135,092 | | $10,231,847 |
| | | | | | | | | | | | | | |
(i) Represents the grant date fair value of stock and option awards granted in Fiscal Year.
(ii) No NEOs were eligible to participate in the U.S. pension plan in 2022. For 2020 and 2021, no service costs were accrued as Mr. Zachman's pension was under a frozen plan and the other NEOs were not eligible to participate in the U.S. pension plan. No NEOs participate in the deferred compensation program, including our PEO.
(iii) Fair value at Fiscal Year-end of outstanding and unvested stock and option awards granted in Fiscal Year.
(iv) Change in fair value of outstanding and unvested stock and option awards granted in prior Fiscal Years.
(v) Change in fair value as of vesting date of stock and option awards granted in prior Fiscal Years for which applicable vesting conditions were satisfied during Fiscal Year.
(2)For 2020 and 2021, the Non-PEO NEOs consisted of Messrs. Neppl, Padilla, Zachman and Dimopoulos. For 2022, the Non-PEO NEOs consist of Messrs. Neppl, Dimopoulos, Garros and Podwika.
(3)Pursuant to the rules of the SEC, the comparison assumes $100 was invested on December 31, 2019 in our common shares. Historic stock price performance is not necessarily indicative of future stock performance.
(4)The industry index is the Standard and Poor's (S&P) 500 Food Products Index as disclosed in the Company's annual report on Form 10-K.
(5)Represents timing adjusted earnings per share excluding certain gains and charges, which is the financial measure from the Company performance measure below that the Company uses to link compensation paid to the Company's PEO and Non-PEO NEOs for the years shown to the Company's performance. Timing adjusted earnings per share excluding notables, as used in this proxy statement, is a non-GAAP financial measure, see Appendix A – Reconciliation of Non-GAAP Financial Measures for reconciliation to the most directly comparable U.S. GAAP measure.
Bunge | 2023 Proxy Statement 68
Relationship Between Pay and Performance
The following shows the relationship between PEO CAP, Average Non-PEO NEO CAP, TSR and the indexed peer TSR.
Relationship Between Pay and Net Income
The following shows the relationship between PEO CAP, Average Non-PEO NEO CAP and Net Income.
69 Bunge | 2023 Proxy Statement
Relationship Between Pay and Adjusted EPS
The following shows the relationship between PEO CAP, Average Non-PEO NEO CAP and Adjusted EPS.
Most Important Performance Measures
As required, the list below reflects performance measures that we consider the most important for linking executive compensation actually paid to company performance in 2022.
| | | | | | | | |
•Adj EPS(1) | •AROIC | •Relative TSR |
•Adj PBT(I)(2) | •ESG | |
(1)Represents timing adjusted earnings per share excluding certain gains and charges. Timing adjusted earnings per share excluding notables, as used in this proxy statement, is a non-GAAP financial measure, see Appendix A – Reconciliation of Non-GAAP Financial Measures for reconciliation to the most directly comparable U.S. GAAP measure.
(2)Represents adjusted Profit Before Taxes before certain incentive payouts.
For further information regarding these performance measures and their function in the Company's executive compensation program, see the "Compensation Discussion and Analysis" section on page 39 of this proxy statement. Bunge | 2023 Proxy Statement 70
| | |
| PROPOSAL 3 — ADVISORY VOTE ON THE FREQUENCY OF FUTURE SHAREHOLDER ADVISORY VOTES ON EXECUTIVE COMPENSATION |
In accordance with the requirements of Section 14A of the Securities and Exchange Act of 1934, this Proposal 3 provides shareholders with the opportunity, at least once every six years, to provide an advisory vote on how often Bunge should include a say on pay vote on the compensation of our named executive officers in its proxy statement for future annual meetings of shareholders. This is referred to as a say-on-pay frequency vote.
Under this Proposal 3, shareholders may cast their advisory vote for every “1 Year,” “2 Years,” or “3 Years,” or may abstain from voting. Shareholders are not voting to approve or disapprove the Board's recommendation.
In 2011, we held our first advisory say-on-pay frequency vote and, consistent with the Board’s recommendation, over 90% of the shares voted were in favor of an annual vote and, again in 2017, Bunge held the advisory say on pay frequency vote and over 90% of the shares voted were voted “for” an annual vote.
This year, the Board again recommends that shareholders approve, on an advisory basis, holding an annual say-on-pay vote. The Board continues to believe that an annual vote is most appropriate for Bunge as it provides shareholders with an opportunity to express their views on our executive compensation program in a consistent and timely manner.
Although the vote on this Proposal 3 is advisory and non-binding, the Human Resources and Compensation Committee and the Board will review the voting results and will consider shareholder views when determining the frequency of future say-on-pay votes.
A say-on-pay frequency vote must be held at least once every six years. Accordingly, following this year’s say-on-pay frequency vote, we anticipate that the next such vote will be held at the annual shareholder meeting in 2029.
| | | | | |
| R | OUR BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR A NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION TO BE HELD ANNUALLY AND THAT SHAREHOLDERS VOTE FOR "1 YEAR." |
71 Bunge | 2023 Proxy Statement
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| PROPOSAL 4 — APPOINTMENT OF INDEPENDENT AUDITOR AND AUTHORIZATION OF THE AUDIT COMMITTEE OF THE BOARD TO DETERMINE THE INDEPENDENT AUDITOR'S FEES |
General
Our Board has recommended and asks that you appoint Deloitte & Touche LLP as our independent auditor for the fiscal year ending December 31, 2023 and authorize the Audit Committee of the Board to determine the independent auditor's fees. You would be acting based on the recommendation of our Audit Committee. Deloitte & Touche LLP has audited our annual financial statements since 2002. Pursuant to Bermuda law and our bye-laws, an auditor is appointed at the annual general meeting or at a subsequent general meeting in each year and shall hold office until a successor is appointed.
The affirmative vote of a majority of the votes cast on the proposal is required to make such appointment. If you do not appoint Deloitte & Touche LLP, our Board will reconsider its selection of Deloitte & Touche LLP and make a proposal for a new independent auditor.
Representatives of Deloitte & Touche LLP are expected to attend the virtual Annual General Meeting and will have the opportunity to make a statement if they desire to do so. We also expect that they will be available to respond to questions.
Fees
The chart below sets forth the aggregate fees for professional services rendered by the Deloitte & Touche LLP for services performed in each of 2022 and 2021, and breaks down these amounts by category of service:
| | | | | | | | | | | |
| | 2022 | | 2021 |
| Audit Fees | $13,856,789 | | $14,971,060 |
| Audit-Related Fees | $347,881 | | $343,981 |
| Tax Fees | $70,000 | | $140,000 |
| All Other Fees | $58,521 | | $41,240 |
| Total | $14,333,191 | | $15,496,281 |
Audit Fees
Audit fees are fees billed for the audit of our annual consolidated financial statements, the audit of our internal control over financial reporting and the reviews of our quarterly financial statements. Additionally, audit fees include comfort letters, statutory audits, consents and other services related to SEC matters.
Audit-Related Fees
For 2022 and 2021, audit-related fees include fees for audits in conjunction with acquisitions and divestitures, statutory attestation services, work related to employee benefit plans and certain other agreed-upon procedures engagements.
Tax Fees
Tax fees in 2022 and 2021 primarily relate to tax compliance services, tax planning advice and tax due diligence. Tax compliance services are services rendered based upon facts already in existence or transactions that have already occurred to document, compute and review amounts to be included in tax filings.
Bunge | 2023 Proxy Statement 72
All Other Fees
For All Other Fees, in 2022 and 2021 fees were paid to Deloitte & Touche, LLP for subscriptions to a comprehensive database of accounting and financial disclosure-related literature, as well as for certain local market non-recurring advisory services.
Pre-Approval Policies and Procedures
The Audit Committee has adopted a policy for pre-approval of all audit services, audit-related services, tax services and other services provided by our independent auditor. Pre-approval is detailed as to particular types of services and is subject to specific fee levels. The independent auditor and management are required to periodically report to the Audit Committee regarding the services that have been provided to us in accordance with this pre-approval policy.
All of the services relating to the fees described in the table above were pre-approved by our Audit Committee. In making its recommendation to appoint Deloitte & Touche LLP as our independent auditor for the fiscal year ending December 31, 2023, the Audit Committee has considered whether the services provided by Deloitte & Touche LLP are compatible with maintaining the independence of Deloitte & Touche LLP and has determined that such services do not interfere with Deloitte & Touche LLP's independence.
| | | | | |
| R | OUR BOARD RECOMMENDS THAT, BASED ON THE RECOMMENDATION OF THE AUDIT COMMITTEE, YOU VOTE FOR THE APPOINTMENT OF DELOITTE & TOUCHE LLP TO SERVE AS OUR INDEPENDENT AUDITOR FOR THE FISCAL YEAR ENDING DECEMBER 31, 2023 AND THE AUTHORIZATION OF THE AUDIT COMMITTEE OF THE BOARD TO DETERMINE THE INDEPENDENT AUDITOR'S FEES. |
73 Bunge | 2023 Proxy Statement
Our Audit Committee is composed of five independent directors, all of whom are financially literate. In addition, our Board has determined that Messrs. Simril and Winship each qualifies as an "audit committee financial expert" as defined under Item 407 of Regulation S-K of the Securities Act of 1933, as amended. The Audit Committee operates under a written charter which reflects NYSE listing standards and SEC requirements regarding audit committees. A copy of the charter is available through the "Investors — Governance" section of our website at bunge.com.
The Audit Committee's primary role is to assist the Board in fulfilling its responsibility for oversight of (1) the quality and integrity of our financial statements and related disclosures, (2) our compliance with legal and regulatory requirements, (3) our independent auditor's qualifications, independence and performance and (4) the performance of our internal audit and control functions.
Our management is responsible for the preparation of our financial statements, our financial reporting process and our system of internal controls. Our independent auditor is responsible for performing an audit of the financial statements in accordance with the standards of the Public Company Accounting Oversight Board, which we refer to as the PCAOB, and issuing an opinion as to the conformity of those audited financial statements to U.S. generally accepted accounting principles and for auditing the effectiveness of our internal control over financial reporting. The Audit Committee monitors and oversees these processes.
The Audit Committee has sole authority over the selection of our independent auditor and manages our relationship with the independent auditor (who report directly to the Audit Committee). Deloitte & Touche LLP has served as our independent auditor since 2002. Each year, the Audit Committee evaluates the performance, qualifications and independence of the independent auditor. The Audit Committee is also involved in the selection of the lead audit partner. The Audit Committee pre-approves all audit, audit-related services, tax services and other services provided by the independent auditor and the fees for those services pursuant to written policies and procedures.
The Audit Committee meets with management and the independent auditor periodically to consider the adequacy of our internal controls. The Audit Committee also receives regular updates from our internal audit function, which has unrestricted access to the Audit Committee.
The Audit Committee has reviewed and discussed with management and Deloitte & Touche LLP the audited financial statements as of and for the year ended December 31, 2022 and Deloitte’s evaluation of our internal control over financial reporting. The Audit Committee has also discussed with the independent auditor the matters required to be discussed pursuant to PCAOB Auditing Standard No. 1301 (Communications with Audit Committees). In addition, the Audit Committee has received the written disclosures and the letter from Deloitte required by the applicable requirements of the PCAOB regarding Deloitte's communications with the Audit Committee concerning independence and has discussed with them their independence from Bunge and its management. The Audit Committee also considered whether the non-audit services provided by Deloitte & Touche LLP to us during 2022 were compatible with their independence as auditor.
Based on these reviews and discussions, the Audit Committee has recommended to the Board, and the Board has approved, the inclusion of the audited financial statements in our Annual Report on Form 10-K for the year ended December 31, 2022 for filing with the Securities and Exchange Commission.
Members of the Audit Committee
Henry "Jay" Winship, Chair
Eliane Aleixo Lustosa de Andrade
Sheila Bair
Kenneth Simril
Mark Zenuk
Bunge | 2023 Proxy Statement 74
| | |
| PROPOSAL 5 — SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER RATIFICATION OF TERMINATION PAY |
Bunge has received notice from Kenneth Steiner, 14 Stoner Avenue, 2M, Great Neck, New York 11021, that he intends to present, through his proxy, John Chevedden, a separate proposal for voting at the Annual General Meeting. John Chevedden has submitted documentation indicating that Mr. Steiner has beneficial ownership of a sufficient amount of Bunge common shares for a sufficient time period as required by Rule 14a-8. The shareholder proposal will be voted on at the Annual General Meeting only if properly presented by or on behalf of Kenneth Steiner. All statements contained in the shareholder proposal and supporting statement are the sole responsibility of the proponent of the shareholder proposal.
Proposal 5 – Shareholder Ratification of Termination Pay
Shareholders request that the Board seek shareholder approval of any senior manager's new or renewed pay package that provides for severance or termination payments with an estimated value exceeding 2.99 times the sum of the executive's base salary plus target short-term bonus.
"Severance or termination payments" include cash, equity or other pay that is paid out or vests due to a senior executive's termination for any reason. Payments include those provided under employment agreements, severance plans, and change-in-control clauses in long-term equity plans, but not life insurance, pension benefits, or deferred compensation earned and vested prior to termination.
"Estimated total value" includes: lump-sum payments; payments offsetting tax liabilities, perquisites or benefits not vested under a plan generally available to management employees, post-employment consulting fees or office expense and equity awards if vesting is accelerated, or a performance condition waived, due to termination.
The Board shall retain the option to seek shareholder approval after material terms are agreed upon.
Generous performance-based pay can sometimes be justified but shareholder ratification of "golden parachute" severance packages with a total cost exceeding 2.99 times base salary plus target short-term bonus better aligns management pay with shareholder interests.
For instance at one company, that does not have this policy, if the CEO is terminated he could receive $44 million in termination pay - over 10 times his base salary plus short-term bonus. In the event of a change in control, the same person could receive a whopping $124 million in accelerated equity payouts even if he remained employed.
It is in the best interest of Bunge shareholders and the morale of Bunge employees to be protected from such lavish management termination pay for one person.
It is important to have this policy in place so that Bunge management stays focused on improving company performance as opposed to seeking a business combination as a distraction and to trigger a management golden parachute windfall.
Shareholder Ratification of Excessive Termination Pay, the topic of this proposal, received between 51% and 65% support at:
AbbVie (ABBV)
FedEx (FDX)
Spirit AeroSystems (SPR)
Alaska Air (ALK)
Fiserv (FISV)
75 Bunge | 2023 Proxy Statement
This proposal allows for sky-high termination pay to meet any competitive situation. The sky-high pay would only need to be subject to a nonbinding shareholder vote. Mr. Erik Fyrwald, Chair of the management pay committee could not ask for more flexibility.
Please vote yes:
Shareholder Ratification of Termination Pay - Proposal 5
| | | | | |
| Q | OUR BOARD RECOMMENDS THAT SHAREHOLDERS VOTE AGAINST THE SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER RATIFICATION OF TERMINATION PAY |
| | |
Board of Directors Statement in Opposition to the Shareholder Proposal
|
The Board of Directors recommends a vote “Against” the foregoing proposal for the following reasons: |
The Board believes the shareholder proposal is unnecessary given shareholder support for the Company’s compensation practices and existing compensation limits. In 2021, the Board reconstituted our Human Resources and Compensation Committee with a new committee chair and our independent compensation consultant appointed a new advisor to provide a fresh perspective on our programs. We conducted early shareholder outreach to seek feedback before changes were made to our compensation programs in 2021. The Board believes that the Company has responsible compensation practices, which include limited termination-related pay for executives. This view is supported by the Company’s shareholders, whose votes in favor of say-on-pay proposals exceeded 96% and 94% of the votes cast in 2022 and 2021, respectively. In addition, in 2020 shareholders approved amendments to increase the number of authorized shares in the Company’s 2016 Equity Incentive Plan, by over 96% of the votes cast.
Further, in May 2022, following its customary periodic review of compensation arrangements and in response to feedback from shareholders, the Human Resources and Compensation Committee approved the adoption of an executive severance plan (“ESP”), that harmonizes the terms of various existing contracts and letter agreements with our executives. Under the ESP, executive officers, including our Chief Executive Officer and our other named executive officers, are entitled to cash severance and other benefits in the event of their termination by us other than for cause or by them for good reason, including after a change of control. Change of control cash severance amounts under the ESP are equal to 2x the executive’s base salary and target bonus, and non-change of control cash severance is 1x base salary and target bonus (except that the CEO’s severance benefit is 2x in either circumstance). Under the ESP, change of control or non-change of control cash severance amounts do not exceed 2.99x the executive’s base salary and target bonus. No executive officer has a single-trigger severance right or is entitled to excise tax gross-ups. The Board believes that the ESP, which is more carefully tailored than the overly broad shareholder proposal, strikes the right balance between shareholder rights, executive retention, and incentives for executives to consider objectively potential change of control transactions, and being able to be competitive in the market for talent.
The Board does not believe the shareholder proposal is necessary given the additional voting rights that shareholders will have following the intended redomestication to Switzerland. As announced on December 8, 2022, the Company intends to redomesticate from Bermuda to Switzerland in 2023. Under Swiss corporate law, shareholders will have the right to authorize, at each annual general meeting of shareholders, the maximum aggregate compensation of the Company's key executive management team (“EMT”) members for the next fiscal year. The aggregate compensation of the key EMT members for which shareholder approval will be sought includes any cash bonus and equity awards, and amounts that become payable upon termination of a key EMT member. This new right will give shareholders an opportunity to review our compensation practices in light of all circumstances and will be in addition to the rights shareholders have in connection with say-on-pay votes. Unlike a say-on-pay vote, this new right under Swiss law is not advisory. The Board believes the Swiss law requirement will provide an appropriate balance between shareholder review of our general compensation practices and the need for compensation certainty and flexibility to retain talent and be competitive in the marketplace for new hires. |
Bunge | 2023 Proxy Statement 76
| | |
The shareholder proposal would limit the Company’s reliance on equity compensation, which could place the Company at a competitive disadvantage in attracting and retaining key executive talent. As a leading global agribusiness company, we compete for talent with other large companies in and outside of our industry. Our strong performance has made our executives attractive to other companies and they are aggressively recruited. The Board relies on a competitive compensation program, and in particular equity awards and carefully designed severance benefits, to motivate and retain our executives. The Board believes these benefits are necessary for the Company to remain competitive in attracting and retaining highly qualified individuals upon whom, in large measure, the Company’s long-term growth and success depend. The overly broad shareholder proposal does not permit the flexibility necessary to be competitive in the marketplace for new hires and to retain key talent, particularly at this time of unprecedented labor competition.
The Board believes that long-term performance is the most important measure of the Company’s success. Through the use of equity awards, with multi-year earnings and/or vesting requirements, the Board believes it is aligning financial rewards for the Company’s executives with the economic interests of the Company’s shareholders, through facilitation of significant Company stock ownership which promotes retention of leadership talent critical to the Company’s success. As part of this alignment of interests, the Company’s executives expect that they will be given a fair opportunity to realize the full value of these awards if the Company performs well.
The shareholder proposal could require shareholder approval to allow certain executives to realize the full value of their equity awards upon a qualifying termination. This could have an adverse effect on the Company’s ability to attract and retain key talent because a significant portion of an executive’s compensation may be contingent on shareholder approval and remain uncertain until a shareholder vote could be held. As a result, the Board believes the shareholder proposal would have the effect of discouraging the use of long-term equity incentive awards, and, accordingly, directly conflict with the goal of using the executive compensation program to achieve alignment with the Company’s long-term success.
The shareholder proposal would unduly restrict the Human Resources and Compensation Committee’s flexibility to structure executive compensation. The Company’s fully independent Human Resources and Compensation Committee is in the best position to design and implement executive compensation practices and principles that are aligned with the interests of shareholders. The Human Resources and Compensation Committee must have the flexibility and discretion to structure an effective and competitive executive compensation program, taking into account competitive market practices, and the Company’s strategic, operational, and financial goals. The shareholder proposal would unduly limit the Human Resources and Compensation Committee’s flexibility.
The Board believes that the severance features of the Company’s executive compensation program are appropriate, well-supported by shareholders, and effective for aligning the interests of the Company’s executives with those of the Company’s shareholders, including in the event of a change of control transaction. The adoption of the shareholder proposal could significantly limit the Company’s ability to effectively attract, retain and motivate talented executives. |
| For the foregoing reasons, the Board recommends that you vote AGAINST this proposal. |
77 Bunge | 2023 Proxy Statement
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| SHAREHOLDER PROPOSALS FOR THE 2024 ANNUAL GENERAL MEETING OF SHAREHOLDERS |
To be considered for inclusion in Bunge's proxy statement for our Annual General Meeting of Shareholders in 2023,2024, presently anticipated to be held on May 11, 2023,15, 2024, shareholder proposals must be received by Bunge no later than December 1, 2022.2, 2023. In order to be included in our sponsored proxy materials, shareholder proposals will need to comply with the SEC's Rule 14a-8. If you do not comply with Rule 14a-8, we will not be required to include the proposal in the proxy statement and the proxy card we will mail to our shareholders. Shareholder proposals should be sent to our Corporate Secretary at 1391 Timberlake Manor Parkway, Chesterfield,St. Louis, Missouri 63017, U.S.A., Attention: Corporate Secretary.
Shareholders may also make proposals that are not intended to be included in our proxy statement for the 20232024 Annual General Meeting pursuant to our Bye-laws.bye-laws. Nomination of candidates for election to the Board or other business may be proposed to be brought before the 20232024 Annual General Meeting by any person who is a registered shareholder on the date of the giving of the notice of such proposals and on the record date for the determination of shareholders entitled to receive notice of and vote at the 20232024 Annual General Meeting. Notice must be given in writing and in proper form in accordance with our Bye-lawsbye-laws to the Corporate Secretary of Bunge at Bunge's registered office at Bunge Limited, Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, with a copy to us at 1391 Timberlake Manor Parkway, Chesterfield,St. Louis, Missouri 63017, U.S.A., Attention: Corporate Secretary, no later than December 1, 2022.2, 2023.
In addition, shareholders may submit proposals on matters appropriate for shareholder action at the Annual General Meeting of Shareholders in accordance with Sections 79 and 80 of the Companies Act 1981 of Bermuda. To properly submit such a proposal, either at least 100 shareholders or any number of shareholders who represent at least 5% of the total voting rights of our voting shares must notify us in writing of their intent to submit a proposal. In accordance with Bermuda law, any such shareholder proposal to be voted on at the 20232024 Annual General Meeting and at future annual general meetings must be received by us no later than six weeks prior to the annual general meeting date. Please deliver any such proposal to Bunge Limited, Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, Attention: Corporate Secretary, with a copy to us at 1391 Timberlake Manor Parkway, Chesterfield,St. Louis, Missouri 63017, U.S.A., Attention: Corporate Secretary.
Bunge | 2023 Proxy Statement 78
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HOUSEHOLDINGINFORMATION ABOUT THIS PROXY STATEMENT AND MEETING |
The SEC permitsInformation About this Proxy Statement
Why did I receive this Proxy Statement?
Bunge Limited has furnished these proxy materials to you because our Board of Directors is soliciting your proxy to vote at the Annual General Meeting on May 11, 2023. In order to provide expanded access, this year’s Annual General Meeting will be a singlevirtual meeting of shareholders, which will be conducted via separate live audio webcasts. There will not be a physical meeting. We have designed the virtual meeting to offer the same participation opportunities as an in-person meeting.
This proxy statement contains information about the items being voted on at the Annual General Meeting and important information about us. Our 2022 Annual Report, which includes our 2022 Annual Report on Form 10-K, is also being furnished together with this proxy statement. If you received printed versions of these materials by mail, these materials also include the proxy cards or voting instructions form for the Annual General Meeting. We are making these proxy materials first available to shareholders on or about March 31, 2023.
We have sent these materials to each person who is registered as a holder of our common shares in the register of members (such owners are often referred to as "holders of record" or "registered holders") as of the close of business on March 13, 2023, the record date for the Annual General Meeting.
We have requested that banks, brokerage firms and other nominees who hold our common shares on behalf of the owners of the common shares, (such owners are often referred to as "beneficial shareholders" or "street name holders") as of the close of business on March 13, 2023, forward either a notice or a printed copy of these materials, together with a proxy card or voting instruction form, to those beneficial shareholders. We have agreed to pay the reasonable expenses of the banks, brokerage firms and other nominees for forwarding these materials.
Finally, we have provided for these materials to be sent to persons who have interests in our common shares through participation in the Bunge share funds of the Bunge Retirement Savings Plan, the Bunge Savings Plan and the Bunge Savings Plan—Supplement A. Although these persons are not eligible to vote directly at the Annual General Meeting, they may, however, instruct the trustees of the plans on how to vote the common shares represented by their interests. The enclosed proxy card will also serve as voting instructions for the trustees of the plans. If you do not provide voting instructions for shares held for you in any householdof these plans, the trustees will vote these shares in the same ratio as the shares for which voting instructions are provided.
Shareholders who owned our common shares as of the close of business on the record date for the Annual General Meeting are entitled to access and vote at which twothe Annual General Meeting and adjournments or more shareholders reside if they appearpostponements of the Annual General Meeting. The share register will not be closed between the record date and the date of the Annual General Meeting. A poll will be taken on each proposal to be membersput to shareholder vote at the Annual General Meeting.
What is Notice and Access and why did Bunge elect to use it?
As permitted by regulations of the same family. Each shareholder continuesSecurities and Exchange Commission (SEC), Notice and Access provides companies with the ability to make proxy materials available to shareholders electronically via the internet. We have elected to provide many of our shareholders with a Notice of Internet Availability of Proxy Materials instead of receiving a full set of printed proxy materials in the mail. The notice is a document that provides instructions regarding how to:
•view our proxy materials on the internet;
•access the Annual General Meeting and vote your shares; and
•request printed copies of these materials, including the proxy card or voting instruction form.
On or about March 31, 2023, we began mailing the notice to certain beneficial shareholders and posted our proxy materials on the website referenced in the notice. See "Notice of Annual General Meeting of Shareholders" in this proxy statement for more information about where to view our proxy materials on the internet.
79 Bunge | 2023 Proxy Statement
As more fully described in the notice, shareholders who received the notice may choose to access our proxy materials on the website referenced in the notice or may request to receive a separateprinted set of our proxy card. This procedure, referred to as householding, reducesmaterials. In addition, the volume of duplicatenotice and website provide information shareholders receive and reduces mailing and printing expenses. A number of brokerage firms have instituted householding.
As a result, ifregarding how you hold your shares through a broker and you reside at an address at which two or more shareholders reside, you will likely be receiving only one proxy statement unless any shareholder at that address has given the broker contrary instructions. However, if any such beneficial shareholder residing at such an address wishesmay request to receive a separate proxy statementmaterials in printed form by mail or electronically by email on an ongoing basis. The selected delivery choice will remain in effect until changed by the future, or if any such beneficial shareholder thatshareholder. If you have previously elected to receive our proxy materials electronically, you will continue to receive separateaccess to those materials by email unless you elect otherwise.
What does it mean if I receive more than one notice or set of proxy statements wishesmaterials for each of the Annual General Meeting?
It means that you have multiple accounts at the transfer agent and/or with banks and stockbrokers. Please vote all of your common shares. Beneficial shareholders sharing an address who are receiving multiple notices or copies of proxy materials will need to receive a single proxy statement in the future, that shareholder should contact their broker, bank or sendother nominee to request that only a requestsingle copy of each document be mailed to all shareholders at the shared address in the future. In addition, if you are the beneficial owner, but not the record holder, of our Corporate Secretary at 1391 Timberlake Manor Parkway, Chesterfield, Missouri 63017, U.S.A., Attention: Corporate Secretary.common shares, your broker, bank or other nominee may deliver only one copy of the notice or proxy materials for the Annual General Meeting to multiple shareholders who share an address unless that nominee has received contrary instructions from one or more of the shareholders. We will deliver promptly, upon written or oral request, to the corporate secretary, a separate copy of thisthe notices, proxy statement or 2022 Annual Report to a beneficial shareholder at a shared address to which a single copy of the documents was delivered. Shareholders who wish to receive a separate copy of these documents should submit their request to our Investor Relations department by telephone at (636) 292-3014 or by submitting a written request to 1391 Timberlake Manor Parkway, St. Louis, Missouri 63017, U.S.A., Attention: Investor Relations.
Can I receive future proxy materials electronically?
Shareholders can help us conserve natural resources and reduce the cost of printing and mailing proxy statements and annual reports by opting to receive future mailings electronically. To enroll, please visit enroll.icsdelivery.com/bg and follow the instructions or adjust your delivery instructions on www.proxyvote.com.
Information About the Meeting
What proposals are being presented at the Meeting?
Shareholders are being asked to vote on the following matters at the Annual General Meeting:
•Proposal 1 — election of the 11 directors named in this proxy statement;
•Proposal 2 — the approval of a non-binding advisory vote on the compensation of our named executive officers;
•Proposal 3 — a non-binding advisory vote on the frequency of future shareholder advisory votes on executive compensation;
•Proposal 4 — the appointment of Deloitte & Touche LLP as our independent auditor for fiscal year 2023 and authorization of the Audit Committee of the Board of Directors to determine the independent auditor's fees; and
•Proposal 5 — shareholder proposal regarding shareholder ratification of termination pay.
Other than the matters set forth in this proxy statement and matters incidental to the conduct of the Annual General Meeting, we do not know of any business or proposals to be considered at the Annual General Meeting. If any other business is proposed and properly presented at the Annual General Meeting, the proxies received from our shareholders give the proxy holders the authority to vote on the matter at their discretion.
How do I access the Annual General Meeting to submit questions?
To be admitted to the Annual General Meeting visit www.virtualshareholdermeeting.com/BG2023 and enter the 16-digit control number found on your proxy card or voter instruction form for the Annual General Meeting. If you hold your
71Bunge | 2023 Proxy Statement 80
common shares through a brokerage firm, bank or other nominee, you should follow the instructions provided by your brokerage firm, bank other holder of record to be able to participate in the meeting.
If you wish to submit a question before or during the Annual General Meeting, you may log in to www.virtualshareholdermeeting.com/BG2023 and enter your name, email address and 16-digit control number beginning at 10:45 a.m. Central Daylight Time, on May 11, 2023. Once past the login screen, select the question topic and enter your question in the ‘‘Ask a Question’’ section at the lower left-hand corner of the screen and then click on Submit.
Questions pertinent to meeting matters will be addressed during the Annual General Meeting, subject to time constraints. Questions or comments that relate to proposals that are not properly received before or during at the Annual General Meeting, relate to matters that are not the proper subject for action by shareholders, are irrelevant to our business, relate to material non-public information of the Company, relate to personal concerns or grievances, are derogatory to individuals or that are otherwise in bad taste, are in substance repetitious of a question or comment made by another shareholder, or are not otherwise suitable for the conduct of the Annual General Meeting as determined in our sole discretion, will not be answered. Additional rules of conduct and procedures may apply during the Annual General Meeting and will be available for you to review in advance of the meeting at www.virtualshareholdermeeting.com/BG2023.
My shares are held through a brokerage firm, bank or other nominee. How do I register in advance to access, vote and submit questions at the Annual General Meeting?
If you are a registered holder of common shares (i.e., you hold your shares through our transfer agent, Computershare), you do not need to register in advance to access the Annual General Meeting. Please follow the instructions described above and on your proxy card or voter instruction form that you received for the meeting.
If you hold your common shares through a brokerage firm, bank or other nominee, you should follow the instructions provided by your brokerage firm, bank or other holder of record to be able to participate in the meeting.
What if I have trouble accessing the Annual General Meeting virtually?
The virtual meeting platform is fully supported across browsers (Internet Explorer, Firefox, Chrome and Safari) and devices (desktops, laptops, tablets and mobile phones) running the most updated version of applicable software and plugins. You should ensure that you have a strong internet connection wherever you intend to participate in the meeting. We encourage you to access the meeting prior to the start time. You will be able to log into the Annual General Meeting beginning at 10:45 a.m., Central Daylight Time on May 11, 2023. We will have a technician ready to assist you with any technical difficulties you may have accessing the Annual General Meeting. If you encounter any difficulties accessing the Annual General Meeting, please call the technical support number that will be posted on the virtual meeting platform login page.
If I can't participate in the live Annual General Meeting webcast, can I vote or listen to it later?
You may vote your common shares before the meeting as described in “How do I vote?” and following the instructions on your proxy card or voter instruction form for the meeting. You do not need to access the webcast to vote if you submitted your vote via proxy in advance of the Annual General Meeting. We do not intend to record the Annual General Meeting; however, we will disclose the results on a Form 8-K that we will file with the SEC within four business days of the Annual General Meeting.
81 Bunge | 2023 Proxy Statement
What constitutes a quorum?
The presence at the start of the Annual General Meeting of at least two persons representing, in person or by proxy, more than one-half of our issued and outstanding common shares will constitute a quorum for the transaction of business at each respective meeting.
Information About Voting
How many votes do I have?
Every holder of a common share will be entitled to one vote per share for the election of each director and to one vote per share on each other matter presented at the Annual General Meeting. On March 13, 2023, there were 149,941,547 common shares issued and outstanding and entitled to vote at the Annual General Meeting.
How do I vote?
You can exercise your vote in the following ways:
•By Telephone or the Internet: If you are a shareholder of record, you may appoint your proxy by telephone, or electronically through the internet, by following the instructions on your proxy card for the meeting. If you are a beneficial shareholder, please follow the instructions on your notice or voting instruction form for the meeting.
•By Mail: If you are a shareholder of record, you may appoint your proxy by marking, dating and signing your proxy card for the meeting and returning it by mail in the enclosed postage-paid envelope. If you are a beneficial shareholder and received or requested printed copies of the proxy materials, you can vote by following the instructions on your voting instruction form for the meeting.
•At the Meeting: If you are planning to access the Annual General Meeting, you may vote your common shares during the meeting by visiting www.virtualshareholdermeeting.com/BG2023. To vote, you will need your 16-digit control number included on your proxy card, or on the voter instruction form for the meeting.
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WHERE YOU CAN FIND MORE INFORMATIONYour vote is very important. Even if you plan to be present at the Annual General Meeting, we encourage you to vote as soon as possible. |
What if I return my proxy card but do not mark it to show how I am voting?
Bunge-Bermuda files annual, quarterlyIf you sign and current reports,return your proxy statementscard or voting instruction form but do not indicate instructions for voting, your common shares will be voted "FOR" each of Proposals 1, 2, 3 and 4 and "AGAINST" Proposal 5. With respect to any other information withmatter which may properly come before the SEC. Annual General Meeting, your common shares will be voted at the discretion of the proxy holders.
May I change or revoke my proxy?
You may read and copychange or revoke your proxy at any document Bunge-Bermuda filestime before it is exercised in one of four ways:
1.Notify our Corporate Secretary in writing at the SEC’s public reference rooms locatedaddress provided below before the respective meeting related to your proxy that you are revoking your proxy;
2.Use the telephone or the internet to change your proxy for the respective meeting;
3.Submit another proxy card (or voting instruction form if you hold your common shares in street name) with a later date for the respective meeting; or
4.If you are a holder of record, or a beneficial holder with a proxy from the holder of record, by accessing and voting at 100 F Street, N.E., Washington, D.C. 20549. Please call the SECAnnual General Meeting.
Bunge | 2023 Proxy Statement 82
You may not revoke a proxy simply by accessing the Annual General Meeting. To revoke a proxy, you must take one of the actions described above. Any written notice of revocation must be sent to the attention of our Corporate Secretary at 1-800-SEC-03301391 Timberlake Manor Parkway, St. Louis, Missouri 63017, U.S.A.
What vote is required in order to approve each proposal?
The affirmative vote of a majority of the votes cast is required to elect each of the nominees for further informationdirector (Proposal 1). As this is an uncontested election, any nominee for director who receives a greater number of votes "against" his or her election than votes "for" such election will not be elected to the Board and the position on the public reference rooms. These SEC filings areBoard that would have been filled by the director nominee will become vacant.
The affirmative vote of a majority of the votes cast is also availablerequired to approve the publicnon-binding advisory vote on named executive officer compensation (Proposal 2), to approve the non-binding advisory vote on the SEC’s web site at: http://www.sec.gov. Copiesfrequency of these reports, proxy statementsfuture shareholder advisory votes on executive compensation (Proposal 3), the appointment of our independent auditor and other information can also be inspectedauthorization of the Audit Committee of the Board to determine independent auditor fees (Proposal 4) and shareholder proposal regarding shareholder ratification of termination pay (Proposal 5).
Proposals 2 and 3 are advisory votes only and, as discussed in the proposals, the voting results are not binding on us. However, consistent with our record of shareholder engagement, our Board will review the results of the vote and will take them into account in considering the compensation of our named executive officers and the frequency of future advisory votes on executive compensation.
Pursuant to Bermuda law, (i) common shares which are represented by "broker non-votes" (i.e., common shares held by brokers which are represented at the officesAnnual General Meeting but with respect to which the broker is not empowered to vote on a particular proposal) and (ii) common shares represented at the Annual General Meeting which abstain from voting on any matter, are not included in the determination of the common shares voting on such matter, but are counted for quorum purposes.
Under the rules of the New York Stock Exchange at 20 Broad Street, New York, New York 10005.(NYSE), if you do not submit specific voting instructions to your broker, your broker will not have the ability to vote your common shares in connection with Proposals 1, 2, 3, 4 and 5. Accordingly, if your common shares are held in street name and you do not submit voting instructions to your broker, your common shares will be treated as broker non-votes for these proposals.
Bunge-Bermuda’s web site is located at http://www.bunge.com. Bunge-Bermuda’s Annual ReportsHow will voting on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the SEC are available, free of charge, through its web site, as soon as reasonably practicable after those reports or filings are electronically filed with or furnished to the SEC. Information on Bunge-Bermuda’s web site or any other web site is not incorporated by referencebusiness be conducted?
Other than the matters set forth in this proxy statement and doesmatters incident to the conduct of the Annual General Meeting, we do not constitute a partknow of thisany business or proposals to be considered at the meeting. If any other business is properly proposed and presented at the Annual General Meeting, the proxies received from our shareholders give the proxy statement.holders the authority to vote on the matter at the discretion of the proxy holders.
SEC rulesWho will count the votes?
Broadridge will act as the inspector of election and regulations permit Bunge-Bermuda to “incorporatewill tabulate the votes.
Deadline for Appointment of Proxies by reference”Telephone or the information Bunge-Bermuda files withInternet or Returning Your Proxy Card
Shareholders should complete and return the SEC. This means that Bunge-Bermuda can disclose important information to you by referring you to those documents. Some documents or information, suchproxy card for the Annual General Meeting as that calledsoon as possible. To be valid, your proxy card for by Item 7.01 of Form 8-K, are deemed furnished and not filedthe meeting must be completed in accordance with SEC rules. Nonethe instructions on it and received by us no later than 10:59 p.m., Central Daylight Time, on May 10, 2023. If you appoint your proxy by telephone or the internet, we must receive your appointment no later than 10:59 p.m., Central Daylight Time, on May 10, 2023. If you participate in the Bunge share funds of those documentsthe Bunge Retirement Savings Plan, the Bunge Savings Plan or the Bunge Savings Plan — Supplement A, you must submit your voting instructions for the meeting no later than 10:59 p.m. Central Daylight Time on May 8, 2023 in order to allow the plan trustees time to receive your voting instructions and nonevote on behalf of that information is incorporatedthe plans. If your common shares are held in street name and you are voting by reference into this proxy statement. The information incorporated by reference is considered to be part of this proxy statement. Information that Bunge-Bermuda files latermail, you should return your voting instruction form for the meeting in accordance with the SECinstructions on that form or as provided by the bank, brokerage firm or other nominee who holds our common shares on your behalf.
83 Bunge | 2023 Proxy Statement
Solicitation of Proxies
We will automatically update and supersede this information.
Bunge-Bermuda incorporates by referencebear the documents listed below and any filings Bunge-Bermuda will make with the SEC under Sections 13(a), 13(c), 14 or 15(d)cost of the Securities Exchange Actsolicitation of 1934 (excludingproxies, including the preparation, printing and mailing of proxy materials and the notice. We will furnish copies of these proxy materials to banks, brokers, fiduciaries and custodians holding shares in their names on behalf of beneficial owners so that they may forward these proxy materials to our beneficial owners.
We have retained Innisfree M&A Incorporated to act as proxy solicitor for the Annual General Meeting for a fee of $20,000 plus reasonable out-of-pocket expenses. In addition, we may supplement the original solicitation of proxies by mail with solicitation by telephone and other means by our directors, officers and/or other employees. We will not pay any information “furnished” but not “filed”) following the dateadditional compensation to these individuals for any such services.
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| UNITED STATES SECURITIES AND EXCHANGE COMMISSION REPORTS |
A copy of this document, but prior to the date of the shareholder meeting. The documents incorporated by reference are:
•Bunge-Bermuda’sour 2022 Annual Report, which includes our Annual Report on Form 10-K for the fiscal year ended December 31, 2021;
•Bunge-Bermuda's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022 and September 30, 2022; and
•Bunge-Bermuda's Current Reports on Form 8-Kas filed with the SEC, is enclosed with these proxy materials. Our Annual Report on March 18, 2022, March 31, 2022 May 5, 2022, May 16, 2022, August 9, 2022, August 24, 2022, November 16, 2022, November 17, 2022, December 6, 2022 and December 8, 2022.
You can request aForm 10-K is also available to shareholders free copy of charge on our website at bunge.com under the above filingscaptions "Investors — Financial Information — SEC Filings" or any filings subsequently incorporated by reference into this proxy statement by writing or calling:
Corporate Secretary
to us at 1391 Timberlake Manor Parkway,
Chesterfield, St. Louis, Missouri 63017, U.S.A., Attention: Investor Relations.
Attention: Corporate Secretary
Telephone: (636) 292-3014
In order to ensure timely delivery of these documents, you should make such request by [●].We have not authorized anyone to giveknow of no other business that will be brought before the Annual General Meeting. If any informationother matter or make any representation aboutproposal should be properly presented and should properly come before the Redomestication or about us that differs from or adds tomeeting for action, the information in this proxy statement orpersons named in the documents incorporated by reference. Therefore, you should not relyaccompanying proxy will vote upon any information that differs from or issuch proposal at their discretion and in addition to the information contained in this proxy statement or in the documents incorporated by reference.accordance with their best judgment.
The information contained in this proxy statement speaks only asBy Order of the date on the cover, unless the information specifically indicates that another date applies.
IN THE SUPREME COURT OF BERMUDA
CIVIL JURISDICTION
COMMERCIAL COURT
2023: No. [●]
IN THE MATTER OF BUNGE LIMITED
AND IN THE MATTER OF THE COMPANIES ACT 1981, SECTION 99
SCHEME OF ARRANGEMENT
(under section 99Board of the Companies Act 1981)
Between
BUNGE LIMITED
(an exempted company incorporated with limited liability
under the laws of Bermuda with registration number 20791)
and
THE SCHEME SHAREHOLDERS
(as hereinafter defined)
PART I
PRELIMINARY
DEFINITIONS
1.In this Scheme, unless the context otherwise requires or unless otherwise expressly provided for, the following expressions shall bear the following meanings:
Directors | | | | | |
Agreement and Plan of Merger | The Agreement and Plan of Merger among Bunge Bermuda, Bunge Switzerland and Bermuda MergerCo dated [●] |
Allowed ProceedingMarch 31, 2023 | Any Proceeding by a Scheme Shareholder to enforce its rights under the Scheme where any party fails to perform its obligations under the Scheme |
Bermuda MergerCo | Horizon Merger Company Limited, an exempted company limited by shares incorporated under the laws of Bermuda with registration number [●] |
Bunge Bermuda | Bunge Limited, an exempted company incorporated with limited liability under the laws of Bermuda with registration number 20791 |
Bunge Bermuda Common Shares | Common shares of US$0.01 par value each of Bunge Bermuda |
Bunge Options | Options to acquire Bunge Bermuda Common Shares under the Bunge Bermuda stock plans |
Bunge Switzerland | [●], a Swiss corporation to be established prior to the Effective Time |
Bunge Switzerland Shares | Registered common shares of US$[0.01] par value each of Bunge Switzerland |
Business Day | Any day on which banks are open for business in Bermuda, New York Lisa Ware-Alexander Vice President, Deputy General Counsel and Zurich |
Companies Act | The Companies Act 1981 of BermudaCorporate Secretary |
74Bunge | 2023 Proxy Statement 84
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Effective Time | The date and time on which a copy of the Order of the Supreme Court sanctioning the Scheme and making such facilitating orders as are appropriate pursuant to Section 99 of the Companies Act shall have been delivered to the Registrar of Companies in Bermuda for registration, at which time this Scheme shall become effective |
Explanatory Statement | The explanatory statement of Bunge Bermuda in connection with the Scheme representing the explanatory statement issued pursuant to Section 100 of the Companies Act and including a notice of the Scheme Meeting |
Proceeding | Any process, suit, action, legal or other proceeding including without limitation any arbitration, mediation, alternative dispute resolution, judicial review, adjudication, demand, execution, restraint, forfeiture, reentry, seizure, lien, enforcement of judgment, enforcement of any security or enforcement of any letters of credit |
Prohibited Proceeding | Any Proceeding against Bunge Bermuda or Bunge Switzerland or their property in any jurisdiction whatsoever other than an Allowed Proceeding |
Proxy Statement | The proxy statement of the Company initially filed on [●] 2023 with the U.S. Securities and Exchange Commission and in connection with this Scheme including the Explanatory Statement and including a notice of the Scheme Meeting |
Record Date | The close of business (Bermuda time) on [●] 2023 |
Register of Members | The Bunge Bermuda register of members |
Scheme | This scheme of arrangement in respect of Bunge Bermuda under Section 99 of the Companies Act in its present form or with or subject to any modifications, additions or conditions that are consented to by Bunge Bermuda and that the Supreme Court may approve or impose |
Scheme Consideration | One Bunge Switzerland Share to be issued and allotted by Bunge Switzerland in exchange for each Scheme Share held immediately prior to the Effective Time by a Scheme ShareholderAPPENDIX A — RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
This proxy statement contains certain "non-GAAP financial measures" as defined in Regulation G of the Securities Exchange Act of 1934. Bunge has reconciled these non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures below. The non-GAAP financial measures that Bunge uses may not be comparable to similarly titled measures used by other companies.
Adjusted earnings per share is a non-GAAP financial measure and is not intended to replace Net income attributable to Bunge or Net income per common share - diluted, the most directly comparable U.S. GAAP financial measure. Adjusted earnings per share is calculated by excluding from Net income per common share-diluted, certain gains and charges and temporary mark-to-market timing differences, as defined below.
Below is a reconciliation of Net income attributable to Bunge, to adjusted Net income attributable to Bunge and adjusted earnings per share:
| | | | | | | | | | | | | | |
| (US$ in millions, except per share data) | | 2022 | 2021 | 2020 |
| Net income attributable to Bunge | | $ | 1,610 | | $ | 2,078 | | $ | 1,145 | |
Adjustment for Mark-to-market timing differences (1) | | 246 | 12 | 138 |
| Adjusted for certain (gains) and charges: | | | | |
| Severance, employee benefit, and other | | — | | — | | 3 | |
| Impairment charges | | 227 | | 164 | | — | |
| Pension settlement | | (21) | | — | | — | |
| Bond early redemption | | 39 | | — | | — | |
| Tax on disposition of a business | | 30 | | — | | — | |
| Gain on sale of assets | | — | | (165) | | (65) | |
| Gain on sale of a business | | — | | (119) | | — | |
| Indirect tax (credits) and charges | | — | | — | | (32) | |
| Commercial claim provision | | — | | — | | 66 | |
| U.S. pension plan partial settlement | | — | | — | | 9 | |
| Income tax (benefits) charges and Interest | | — | | — | | (21) | |
| Adjusted Net income available for common shareholders | | $ | 2,131 | | $ | 1,970 | | $ | 1,243 | |
Weighted-average common shares outstanding - diluted (2) | | 153 | 152 | 150 |
| Adjusted earnings per share - diluted | | $ | 13.91 | | $ | 12.93 | | $ | 8.30 | |
(1) Mark-to-market timing difference comprises the estimated net temporary impact resulting from unrealized period-end gains/losses associated with the fair valuation of certain forward contracts, readily marketable inventories (RMI), and related futures contracts associated with our committed future operating capacity. The impact of these mark-to-market timing differences, which is expected to reverse over time due to the forward contracts, RMI, and related futures contracts being part of an economically-hedged position, is not representative of the operating performance of our business.
(2) There were zero, 1 million, and 6 million anti-dilutive stock options or contingently issuable restricted stock units included in the weighted-average number of common shares outstanding for the years ended December 31, 2022, 2021, and 2020, respectively.
75Bunge | 2023 Proxy Statement A-1
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Scheme Meeting | The meeting of the Scheme Shareholders convened at the direction of the Supreme Court at which the Scheme will be voted upon or any postponement or adjournment thereof |
Scheme Shareholders | Holders of Scheme Shares appearing in the Bunge Limited register of members immediately prior to the Effective Time (including Bunge Bermuda in respect of Bunge Bermuda Common Shares held in treasury) |
Scheme Shares | Bunge Bermuda Common Shares in issue immediately prior to the Effective Time (including Bunge Bermuda Common Shares held in treasury) |
Supreme Court | The Supreme Court of Bermuda |
US$ | United States dollars, the lawful currency of the United States of America |
INTERPRETATION
B.In this Scheme, unless the context otherwise requires or otherwise expressly provides:
1)references to Recitals, Parts, clauses and sub-clauses are references to the Recitals, Parts, clauses and sub-clauses respectively of this Scheme;
2)references to a person include references to an individual, firm, partnership, company, corporation, other legal entity, unincorporated body of persons or any state or state agency;
3)references to a statute or a statutory provision include the same as subsequently modified, amended or reenacted from time to time;
4)references to an agreement, deed or document shall be deemed also to refer to such agreement, deed or document as amended, supplemented, restated, verified, replaced and/or novated (in whole or in part) from time to time and to any agreement, deed or document executed pursuant thereto;
5)the singular includes the plural and vice versa and words importing one gender shall include the other gender;
6)headings to Recitals, Parts, clauses and sub-clauses are for ease of reference only and shall not affect the interpretation of this Scheme; and
7)to the extent that there shall be any conflict or inconsistency between the terms of this Scheme and the Explanatory Statement, then the terms of this Scheme shall prevail.
BUNGE BERMUDA
C.Bunge Bermuda was incorporated with limited liability in Bermuda on 18 May 1995 as an exempted company limited by shares with registration number 20791.
D.As of the date of the Scheme Meeting, Bunge Bermuda will have an authorised share capital of US$4,210,000 divided into (i) 400,000,000 common shares of par value US$0.01 each ("Bunge Bermuda Common Shares"), of which [149,800,163] have been issued and are fully paid up or credited as fully paid up, and the remainder remain unissued; and (ii) 21,000,000 preference shares of par value US$0.01 each, none of which are issued and outstanding.
E.On the Record Date there were in aggregate (1) [149,800,163] issued and outstanding Bunge Bermuda Common Shares, including [●] Bunge Bermuda Common Shares held in treasury by Bunge Bermuda, and (2) [●] Bunge Options of which [●] have vested and may be exercisable in full or in part.
AT THE EFFECTIVE TIME, ALL BUNGE OPTIONS AND OTHER AWARDS ISSUED, OR BENEFITS AVAILABLE OR BASED ON, BUNGE BERMUDA COMMON SHARES THEN OUTSTANDING UNDER THE PLANS LISTED ON EXHIBIT [●] TO THE AGREEMENT AND PLAN OF MERGER SHALL REMAIN OUTSTANDING AND, AFTER THE EFFECTIVE TIME, BE DEEMED TO PROVIDE FOR THE ISSUANCE OR PURCHASE OF, OR OTHERWISE RELATE TO, THE BUNGE SWITZERLAND SHARES.
THE PURPOSE OF THE SCHEME
F.The purpose of the Scheme is to effect the redomestication of the parent company of the Bunge group from Bermuda to Switzerland by way of the exchange of each Bunge Bermuda Common Share for one issued, fully paid and non assessable Bunge Switzerland Share and the issuance and allotment of one new Bunge Bermuda Common Share to Bunge Switzerland pursuant to the terms of the Agreement and Plan of Merger. As a step prior to the Scheme, Bunge Bermuda shall subscribe at nominal value for a number of Bunge Switzerland Shares equal to the number of Scheme Shares, and Bunge Switzerland shall issue such Bunge Switzerland Shares to Bunge Bermuda. Upon the Effective Time, each Bunge Bermuda Common Share issued and outstanding immediately prior to the Effective Time (including Bunge Bermuda Common Shares held in treasury by Bunge Bermuda) shall be cancelled and shall cease to exist. As a result of the Scheme, Scheme Shareholders shall become shareholders of Bunge Switzerland, and Bunge Bermuda shall become a wholly-owned subsidiary of Bunge Switzerland. The Scheme will be effected as provided in Part II, Clause 3 below.
G.Bermuda MergerCo proposes to approve the Scheme by shareholder’s written resolution.
H.Bunge Switzerland has agreed to appear at the hearing of the petition to sanction the Scheme and undertakes to be bound by its terms and to deliver fully paid Bunge Switzerland Shares as provided herein.
PART II
THE SCHEME
Application and effectiveness of the Scheme
1. The compromise and arrangement effected by the Scheme shall apply to the Scheme Shares and shall be binding on the Scheme Shareholders.
Effect of the Scheme
2. At the Effective Time all of the right, title and interest of the Scheme Shareholders in the Scheme Shares shall be subject to the arrangement implemented by the mechanism set out in Clause 3 below.
Exchange of shares and consideration
3. At the later of (i) the Effective Time and (ii) the satisfaction or waiver of the conditions set out in Clause 25 below:
a)Bermuda MergerCo will merge with and into Bunge Bermuda, with Bunge Bermuda as the surviving company;
b)Bermuda MergerCo’s shares will be converted into one Bunge Bermuda Common Share, which Bunge Bermuda shall issue, allot and contribute to Bunge Switzerland, which shall account for such contribution as a contribution to its capital contribution reserves;
c)all Scheme Shares shall be cancelled and converted into the right of Scheme Shareholders to receive Bunge Switzerland Shares;
d)Bunge Switzerland Shares shall be delivered on a one-for-one basis to Scheme Shareholders representing the Scheme Shares which have been cancelled; and
e)Bunge Bermuda shall contribute to Bunge Switzerland all of the Bunge Switzerland Shares to which Bunge Bermuda is entitled pursuant to paragraph (d) above on account of Bunge Bermuda holding Bunge Bermuda Common Shares in treasury, and Bunge Switzerland shall account for such contribution as a contribution to its capital contribution reserves.
PART III
RECORD DATE AND DETERMINATION OF SCHEME SHAREHOLDERS
Record Date
4. The Scheme Shareholders and the number of Scheme Shares that they hold for the purposes of voting at the Scheme Meeting shall be determined from the Register of Members as of the Record Date.
PART IV
DISTRIBUTIONS
Distribution to Scheme Shareholders
5. As soon as reasonably practical following the completion of the actions pursuant to Clause 3 above, Bunge Bermuda shall cause the Bunge Switzerland Shares comprising the Scheme Consideration to be distributed to the Scheme Shareholders.
Rights of Scheme Shareholders
6. With effect from and including the Effective Time, each Scheme Shareholder shall in accordance with the Scheme cease to have any rights with respect to Scheme Shares, except the right to receive the Scheme Consideration. Upon cancellation of the Scheme Shares and issuance of one new Bunge Bermuda Common Share to Bunge Switzerland, the Register of Members of Bunge Bermuda shall be updated to reflect such cancellation and issuance.
PART V
GENERAL SCHEME PROVISIONS
Effective Time and Notification to Scheme Shareholders
7. The Scheme shall become binding and effective at the Effective Time.
8. Bunge Switzerland shall give notification of the Scheme having become effective by filing a Current Report on Form 8-K with the United States Securities and Exchange Commission.
Stay of Prohibited Proceedings
9. After the Effective Time, none of the Scheme Shareholders shall commence a Prohibited Proceeding in respect of or arising from the Scheme.
10. A Scheme Shareholder may commence an Allowed Proceeding against Bunge Bermuda or Bunge Switzerland after the Effective Time provided that it has first given Bunge Bermuda five Business Days’ prior notice in writing of its intention to do so.
Dividends
11. At or after the Effective Time, Bunge Switzerland shall pay from funds on hand at the Effective Time any dividends or other distributions with a record date prior to the Effective Time that may have been declared or made by Bunge Bermuda on the Bunge Bermuda Common Shares which remain unpaid at the Effective Time.In addition, Bunge Switzerland undertakes to Bunge Bermuda to pay from funds on hand any dividends or other distributions with a record date after the Effective Time to the extent such dividends or other distributions have already been declared by Bunge Bermuda prior to the Effective Time.
12. All mandates and other instructions in force at the Effective Time in relation to the Bunge Bermuda Common Shares (including elections for payment of dividends (if any)) shall cease to be valid as effective mandates or instructions.
Costs
13. Bunge Bermuda shall pay in full all costs, charges, expenses and disbursements reasonably incurred by Bunge Bermuda in connection with the negotiation, preparation and implementation of the Scheme as and when they arise, including the costs of holding the Scheme Meeting, the costs of obtaining the sanction of the Supreme Court and the costs of placing the notices required by the Scheme.
Existing instruments of transfer and certificates
14. As from the Effective Time, all instruments of transfer and certificates validly existing at the Effective Time in respect of a transfer or holding of any Scheme Shares shall as from the Effective Time, cease to have effect as documents or evidence of transfer or title.
Modifications of the Scheme
15. At any hearing before the Supreme Court to sanction the Scheme, Bunge Bermuda may, subject to U.S. securities law constraints, consent on behalf of all Scheme Shareholders to any modification of the Scheme or any terms or conditions that the Supreme Court determines to approve or impose.
Notice
16. Any notice or other written communication to be given under or in relation to the Scheme other than pursuant to Clauses 10 and 21 shall be given in writing and shall be deemed to have been duly given if:
a)in the case of Bunge Bermuda, it is delivered by hand or sent by post, to Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, marked for the attention of the Secretary;
b)in the case of a Scheme Shareholder, its last known address according to Bunge Bermuda; and
c)in the case of any other person, it is delivered by hand or sent by post, to any address set forth for that person in any agreement entered into in connection with the Scheme or the last known address according to Bunge Bermuda, or by fax its last known fax number according to Bunge Bermuda.
17. Any notice or other written communication to be given under the Scheme shall be deemed to have been served:
a)if delivered by hand, on the first Business Day following delivery;
b)if sent by post, on the second Business Day after posting if the recipient is in the country of dispatch, otherwise on the seventh Business Day after posting;
c)if by fax, on the Business Day sent; and
d)if by advertisement, on the date of publication.
18. In proving service, it shall be sufficient proof, in the case of a notice sent by post, that the envelope was properly stamped, addressed and placed in the post.
19. Save in the case of the notice, written communication or document required to be filed pursuant to Clause 10 above, the accidental omission to send any notice, written communication or other document in accordance with Clauses 16 and 17 above or the non-receipt of any such notice by a Scheme Shareholder, shall not affect the provisions of the Scheme.
20. Bunge Bermuda shall not be responsible for any loss or delay in the transmission of any notices, other documents or payments posted by or to the Scheme Shareholders which shall be posted at the risk of the Scheme Shareholders.
21. Any notice or other written communication that is required to be given to all or substantially all Scheme Shareholders shall be effective by filing a Current Report on Form 8-K with the United States Securities and Exchange Commission and shall be deemed to be served upon acceptance by the EDGAR system thereof.
Exercise of Discretion
22. When under any provision of the Scheme a matter is to be determined by Bunge Bermuda, then it will have discretion to interpret such matter under the Scheme in a manner that it considers fair and reasonable, and its decisions will be binding on all concerned.
Governing Law and Jurisdiction
23. At and with effect from the Effective Time, the operative terms of the Scheme shall be governed by, and construed in accordance with, the laws of Bermuda and the Scheme Shareholders hereby agree that the Courts of Bermuda shall have exclusive jurisdiction to hear and determine any suit, action or Proceeding and to settle any dispute which arises out of or is connected with the terms of the Scheme or its implementation or out of any action taken or omitted to be taken under the Scheme or in connection with the administration of the Scheme; and for such purposes, the Scheme Shareholders irrevocably submit to the jurisdiction of the Courts of Bermuda; provided, however, that nothing in this clause shall affect the validity of other provisions determining governing law and jurisdiction as between Bunge Bermuda and the Scheme Shareholders, whether contained in any contract or otherwise.
24. Subject to the provisions of Clause 25(b) below, the terms of the Scheme and the obligations imposed on Bunge Bermuda hereunder shall take effect subject to any prohibition or condition imposed by any applicable law.
Pre-Conditions to the Scheme
25. The Scheme will not be completed unless the following conditions are satisfied or waived:
a)The articles of association of Bunge Switzerland have been registered with the commercial register in [•], Switzerland;
b)The Bunge Switzerland Shares to be delivered in connection with the Scheme have been registered with the competent commercial register in [•], Switzerland and are authorized for listing on the New York Stock Exchange, subject to official notice of issuance;
c)None of Bunge Bermuda, Bermuda MergerCo or Bunge Switzerland is subject to any governmental decree, order or injunction that prohibits the consummation of the Scheme;
d)Bunge Bermuda receives an opinion from Jones Day, in form and substance reasonably satisfactory to it, confirming, as of the Effective Time, certain U.S. federal income tax matters; and
e)Bunge Bermuda receives an opinion from Homburger Ltd., in form and substance reasonably satisfactory to it, confirming, as of the Effective Time, certain Swiss tax matters.
Authorisation
26. The Scheme Shareholders authorise Bunge Bermuda to take all necessary actions and to execute all necessary documents on their behalf as shall be required to procure the delivery of the Bunge Switzerland Shares to the Scheme Shareholders, as provided herein.
Expiry of the Scheme
27. If the transactions contemplated by the Scheme shall not have occurred on or before 5pm Bermuda time on the date nine months after the Effective Time, the Scheme will terminate and all actions taken under the Scheme will be reversed or voided, as if they had never occurred, and the position will revert to that existing immediately prior to the Effective Time.
