Obligation Marfrig Global Foods S.A. 6.875% ( USG5825AAB82 ) en USD

Marfrig Global Foods S.A.

103 % ⇌

Bresil

USG5825AAB82 ( en USD )

6.875% par an ( paiement semestriel )

19/01/2025 - Obligation échue

Prospectus brochure de l'obligation Marfrig Global Foods USG5825AAB82 en USD 6.875%, échue

200 000 USD

1 000 000 000 USD

G5825AAB8

N/A

Marfrig Global Foods est une société multinationale brésilienne de transformation de viande bovine, spécialisée dans l'abattage, la transformation et la distribution de viande bovine, de volaille et d'autres produits alimentaires, opérant sur les marchés internationaux.

L'Obligation émise par Marfrig Global Foods S.A. ( Bresil ) , en USD, avec le code ISIN USG5825AAB82, paye un coupon de 6.875% par an.
Le paiement des coupons est semestriel et la maturité de l'Obligation est le 19/01/2025

MARB BondCo PLC
(a public limited company organized and existing under the laws of England and Wales)
U.S.$1,000,000,000
6.875% Senior Notes due 2025
Unconditionally and Irrevocably Guaranteed by
Marfrig Global Foods S.A., Marfrig Holdings (Europe) B.V. and Marfrig Overseas Limited
We are offering U.S.$1,000,000,000 aggregate principal amount of MARB BondCo PLC 6.875% Senior Notes due 2025 (the
"notes"). MARB BondCo PLC is a public limited company organized and existing under the laws of England and Wales. The notes
are unconditionally and irrevocably guaranteed by Marfrig Global Foods S.A., a sociedade por ações incorporated under the laws
of the Federative Republic of Brazil (referred to as "Marfrig," the "Company" or "we"). The notes are also unconditionally and
irrevocably guaranteed by Marfrig Overseas Limited, an exempted limited liability company incorporated under the laws of the
Cayman Islands and Marfrig Holdings (Europe) B.V. a private limited liability company organized and existing under the laws of
The Netherlands (collectively referred to as the "subsidiary guarantors").
We will pay interest on the notes semi-annually on January 19 and July 19 of each year, commencing on July 19, 2018. The
notes will mature on January 19, 2025. We may redeem some or all of the notes on or after January 19, 2021 at the redemption
prices set forth in this offering memorandum. There is no sinking fund for the notes.
The notes will be unsecured senior obligations and will rank pari passu with all unsecured and unsubordinated obligations of
the Issuer. The guarantees of the notes will be senior unsecured obligations of Marfrig and the subsidiary guarantors and will rank
pari passu with all unsecured and unsubordinated obligations of Marfrig and the subsidiary guarantors. For a more detailed
description of the notes, see "Description of the Notes."
Application has been made to admit the notes on the official list of the Luxembourg Stock Exchange and to trading on the
Euro MTF market. This offering memorandum constitutes a prospectus for the purpose of Luxembourg law dated July 10, 2005 on
Prospectuses for securities, as amended.
Investing in the notes involves risks. See "Risk Factors" beginning on page 23.
Price: 98.641%
plus accrued interest, if any, from January 19, 2018.

Delivery of the notes in book-entry form was made on January 19, 2018.
The notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act").
The notes may not be offered or sold within the United States or to U.S. persons, except to qualified institutional buyers in reliance
on the exemption from registration provided by Rule 144A under the Securities Act ("Rule 144A") and to certain non-U.S. persons
in offshore transactions in reliance on Regulation S under the Securities Act ("Regulation S"). You are hereby notified that sellers
of the notes may be relying on the exemption from the provisions of Section 5 of the Securities Act provided by Rule 144A. For
more information on transfer of the notes, see "Transfer Restrictions."
Lead Managers
BB Securities
Bradesco BBI
BTG Pactual
HSBC
Nomura Santander

The date of this offering memorandum is March 21, 2018.

__________
TABLE OF CONTENTS
Page
Page

Forward-Looking Statements .......................... v
The Guarantors ........................................... 100
Presentation of Financial and Other
Business ...................................................... 104
Information ................................................. vii
Management ............................................... 141
Summary ......................................................... 1
Principal Shareholders ................................ 155
Summary of the Offering .............................. 11
Related Party Transactions ......................... 157
Summary Financial and Other Information .. 16
Description of the Notes ............................. 158
Risk Factors .................................................. 23
Taxation ...................................................... 204
Use of Proceeds ............................................ 38
ERISA and Certain Other Considerations .. 212
Capitalization ................................................ 39
Transfer Restrictions .................................. 214
Exchange Rates ............................................. 40
Plan of Distribution .................................... 217
Selected Financial Information ..................... 42
Validity of Notes ........................................ 226
Management's Discussion and Analysis of
Independent Auditors ................................. 227
Financial Condition and Results of
Enforcement of Judgments and Service of
Operations .................................................. 47
Process ..................................................... 228
Industry Overview ........................................ 80
Listing and General Information ................ 231
Discontinued Operations ............................... 94
Index to Financial Statements ..................... F-1
The Issuer ...................................................... 99

__________
We are responsible for information contained in this offering memorandum. We have not
authorized anyone to give you any other information, and we take no responsibility for any other
information that others may give you. Neither we, nor the Issuer, nor BB Securities Limited, Banco
Bradesco BBI S.A., Banco BTG Pactual S.A. Cayman Branch, HSBC Securities (USA) Inc.,
Nomura Securities International, Inc. and Santander Investment Securities Inc., referred to in this
offering memorandum as the initial purchasers, have authorized anyone to provide you with
information different from, or additional to, that contained in this offering memorandum. This
offering memorandum may only be used and the notes are being offered, and offers to purchase the
notes are being sought, only in jurisdictions where offers and sales are permitted. The information
contained in this offering memorandum is accurate only as of the date of this offering memorandum,
regardless of the time of delivery of this offering memorandum or of any sale of the notes.
In this offering memorandum, references to "Marfrig," the "Company," "we," "us" and "our" are to
Marfrig Global Foods S.A., a corporation (sociedade por ações) incorporated under the laws of the
Federative Republic of Brazil, which is a guarantor of the notes, together with its direct and indirect
subsidiaries, except where the context requires otherwise. All references to "MARB" or the "Issuer" are
to MARB BondCo PLC, a wholly-owned subsidiary of Marfrig, organized and existing under the laws of
England and Wales as a public limited company, and the issuer of the notes. All references to "subsidiary
guarantors" are to Marfrig Holdings (Europe) B.V. ("Marfrig Holdings"), a wholly-owned subsidiary of
Marfrig, incorporated and existing under the laws of The Netherlands as a private limited liability
company, and to Marfrig Overseas Limited ("Marfrig Overseas"), an exempted limited liability company
incorporated under the laws of the Cayman Islands. All references to the "guarantors" are to Marfrig,
Marfrig Holdings and Marfrig Overseas. The guarantees of the notes are unconditional (subject to any
limitations on such guarantees by virtue of applicable local law). When used in this offering memorandum,
the term "Marfrig Group" or the "Group" refer to Marfrig together with its subsidiaries, taken as a whole.
References to "controlling shareholder" are to MMS Participações Ltda. ("MMS Participações"). Marcos
Antonio Molina dos Santos and Marcia Aparecida Pascoal Marçal dos Santos collectively hold all of the
voting stock of MMS Participações and together hold, directly and indirectly, 34.67% of our voting stock
ii

as of September 30, 2017. References to "principal shareholders" refer to persons who own 5.0% or more
of our capital stock. References to "BNDESPAR" are to BNDES Participações S.A.
When used in this offering memorandum, the term "domestic markets" refers to the internal markets
of each of the 12 countries in which we operate, and the term "export markets" refers to the international
markets to which we export our final products from such domestic markets as final destinations.
The term "Brazil" refers to the Federative Republic of Brazil. The term "Brazilian government" refers
to the federal government of Brazil, and the term "Central Bank" refers to the Central Bank of Brazil
(Banco Central do Brasil).
All references in this offering memorandum to "real," "reais" or "R$" are to the legal currency of
Brazil, and all references to "U.S. dollar," "U.S. dollars" or "U.S.$" are to the legal currency of the United
States of America. This offering memorandum contains translations of various real amounts into U.S.
dollars at specified rates solely for your convenience. You should not construe these translations as
representations by us that the real amounts actually represent these U.S. dollar amounts have been or could
be converted into U.S. dollars at the rates indicated or at any other rates. Unless otherwise indicated, we
have translated the real amounts using a rate of R$3.17 to U.S.$1.00, the U.S. dollar selling rate as of
September 30, 2017, as reported by the Central Bank. See "Exchange Rates."
__________
We have prepared this offering memorandum for use solely in connection with the proposed offering
of the notes outside of Brazil. This offering memorandum does not constitute an offer to any other person
or to the public in general to acquire the notes.
Neither the SEC nor any state securities commission nor any other regulatory authority has approved
or disapproved the offering of the notes nor has any of the foregoing authorities passed on or endorsed the
merits of the offering or the accuracy or adequacy of this offering memorandum. Any representation to
the contrary is a criminal offense.
We are relying on exemptions from registration under the Securities Act for offers and sales of
securities that do not involve a public offering in the United States. The notes offered through this
offering memorandum are subject to restrictions on transferability and resale, and may not be transferred
or resold in the United States, except as permitted under the Securities Act and applicable U.S. state
securities laws pursuant to registration or exemption from them. By purchasing the notes, you will be
deemed to have made the acknowledgments, representations, warranties and agreements described
under the heading "Transfer Restrictions" in this offering memorandum. You should be aware that you
may be required to bear the financial risks of this investment for an indefinite period of time. In making
investment decisions, you must rely on your own examination of our business and the terms of the
offering, including the merits and risks involved.
You must comply with all applicable laws and regulations in force in any jurisdiction in which you
purchase, offer or sell the notes or possess or distribute this offering memorandum and must obtain any
consent, approval or permission required for your purchase, offer or sale of the notes or common shares
issuable on conversion of the notes under the laws and regulations in force in any jurisdiction to which
you are subject or in which you make such purchases, offers or sales. Neither we nor the initial purchasers
will have any responsibility therefor.
We and the initial purchasers reserve the right to reject, in whole or part, and for any reason, any
offer to purchase notes offered hereby. We and the initial purchasers also reserve the right to sell or place
less than all of notes offered hereby.
No representation or warranty, express or implied, is made by the initial purchasers or their respective
affiliates as to the accuracy or completeness of any of the information set out in this offering memorandum,
and nothing contained in this offering memorandum is or shall be relied upon as a promise or
representation by the initial purchasers, whether as to the past or to the future.
____________________
iii

NOTICE TO INVESTORS IN THE EUROPEAN ECONOMIC AREA
The notes are not intended to be offered, sold or otherwise made available to, and should not be
offered, sold or otherwise made available to, any retail investor in the European Economic Area. For the
purposes of this provision the expression "retail investor" means a person who is one (or more) of the
following: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended,
"MiFID II"), or (ii) a customer within the meaning of Directive 2002/92/EC (as amended, the "Insurance
Mediation Directive"), where that customer would not qualify as a professional client as defined in point
(10) of Article 4(1) of MiFID II. Consequently no key information document required by Regulation (EU)
No 1286/2014 (as amended, the "PRIIPs Regulation") for offering or selling the notes or otherwise making
them available to retail investors in the European Economic Area has been prepared and therefore offering
or selling the notes or otherwise making them available to any retail investor in the European Economic
Area may be unlawful under the PRIIPS Regulation.
Solely for the purposes of each manufacturer's product approval process, the target market
assessment in respect of the notes has led to the conclusion that: (i) the target market for the notes is
eligible counterparties and professional clients only, each as defined in MiFID II; and (ii) all channels for
distribution of the notes to eligible counterparties and professional clients are appropriate. Any person
subsequently offering, selling or recommending the notes (a "distributor") should take into consideration
the manufacturers' target market assessment. However, a distributor subject to MiFID II is responsible for
undertaking its own target market assessment in respect of the notes (by either adopting or refining the
manufacturers' target market assessment) and determining appropriate distribution channels.
NOTICE TO INVESTORS IN THE UNITED KINGDOM
Each initial purchaser has represented and agreed that:
(a) (i) it is a person whose ordinary activities involve it in acquiring, holding, managing or disposing
of investments (as principal or agent) for the purposes of its business and (ii) it has not offered
or sold and will not offer or sell the notes other than to persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments (as principal or as agent) for
the purposes of their businesses or who it is reasonable to expect will acquire, hold, manage or
dispose of investments (as principal or agent) for the purposes of their businesses where the
issue of the notes would otherwise constitute a contravention of Section 19 of the Financial
Services and Market Act 2000 ("FSMA") by the Issuer;
(b) it has only communicated or caused to be communicated and will only communicate or cause
to be communicated an invitation or inducement to engage in investment activity (within the
meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of the
notes in circumstances in which Section 21(1) of the FSMA does not apply to the Issuer or the
guarantors; and
(c) it has complied and will comply with all applicable provisions of the FSMA with respect to
anything done by it in relation to the notes in, from or otherwise involving the United Kingdom.
____________________
iv

FORWARD-LOOKING STATEMENTS
This offering memorandum contains estimates and forward-looking statements, principally in the
sections "Summary," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and
Results of Operations," and "Business." Our estimates and forward-looking statements are based on our
current expectations and projections of future events and trends, which affect or may affect our businesses
and results of operations. Words such as "believe," "anticipate," "seek," "expect," "estimate," "will,"
"plan," "may," "could," "intend," "predict," "project" and other similar words are used in this offering
memorandum to identify forward-looking statements.
Although we believe that these estimates and forward-looking statements are based upon reasonable
assumptions, they are subject to several risks and uncertainties and are made in light of information
currently available to us. Many important factors, in addition to the ones discussed in this offering
memorandum, may adversely affect our results, including, but not limited to, the following:
·
Marfrig's level of debt and other financial obligations and ability to refinance its debt;
·
Marfrig's ability to integrate the operations of acquired assets with its ongoing business;
·
fluctuations of the real against the U.S. dollar and the other currencies in the countries in which
Marfrig operates;
·
the macroeconomic conditions, and the political, social and business conditions in Brazil and in
other countries in which Marfrig operates, including the U.S. and the Asia Pacific, Middle East
and Africa ("APMEA") regions;
·
changes in market prices, customer preferences and competitive conditions;
·
Marfrig's ability to implement its business strategy, including its financial strategy and
investment plan;
·
Marfrig's ability to obtain financing when necessary and on favorable terms;
·
government interventions resulting from changes in economic conditions, in taxes or the
regulatory frameworks of Brazil and the other countries in which Marfrig operates;
·
the conditions of transportation infrastructure in the countries in which Marfrig operates;
·
the adoption of tariffs, trade barriers, sanitary regulations or other import restrictions by
countries to which Marfrig exports or plans to export its products;
·
the adoption of sanitary regulations in domestic markets;
·
Marfrig's ability to develop innovative products and concepts and to implement its products
within defined timelines;
·
Marfrig's ability to keep a high degree of customer satisfaction;
·
Marfrig's ability to compete successfully;
·
Marfrig's ability to execute its expansion plans, and to fund the costs and capital expenditures
related to these plans;
·
anti-corruption investigations involving Marfrig's chairman and controlling shareholder, or
other directors, officers or employees, which could materially or adversely affect Marfrig's
public perception and/or reputation, business or financial condition;
·
the outbreak of disease affecting animals;
·
developments in, or changes to, the tax, social security, labor and environmental laws and
regulations, including the regulatory framework, which could make Marfrig's business model
or products less attractive;
·
developments in, or changes to, Brazilian accounting practices;
v

·
other factors or trends affecting Marfrig's liquidity, financial condition and results of operations;
and
·
the factors discussed in the section "Risk Factors" of this offering memorandum.
Estimates and forward-looking statements involve risks and uncertainties and are not guarantees of
future performance. Our future results may differ materially from those expressed in the estimates and
forward-looking statements. In light of these risks and uncertainties, the estimates and forward-looking
statements discussed in this offering memorandum might not occur and our future results and performance
may differ materially from those expressed in the forward-looking statements, or from our past results and
performance, due to the aforementioned or other factors. Because of these risks and uncertainties, you
should not make any investment decision based on the estimates and forward-looking statements. The
forward-looking statements included in this offering memorandum are made only as of the date of this
offering memorandum, and neither we nor the initial purchasers undertake any obligation to update or to
revise this information.
vi

PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Financial Information
We prepare our financial statements in accordance with accounting practices adopted in Brazil, which
are based on:
·
Brazilian corporate law (Law No. 6,404, dated December 15, 1976, as amended, including the
provisions of Law No. 11,638, dated December 28, 2007, Law No. 11,941, dated May 27, 2009
and Law No. 12,431, dated June 24, 2011) ("Brazilian Corporate Law");
·
accounting pronouncements issued by the Accounting Pronouncements Committee (Comitê de
Pronunciamentos Contábeis, or the "CPC"); and
·
as we are a public company in Brazil, rules and regulations issued by the Brazilian security and
exchange commission (Comissão de Valores Mobiliários, or the "CVM").
We refer to these accounting practices as "Brazilian GAAP." Brazilian GAAP has changed in recent
years to converge with International Financial Reporting Standards, International Accounting Standards
and Interpretations ("IFRS") as issued by the International Accounting Standards Board ("IASB"). Our
consolidated financial statements as of and for the nine-month periods ended September 30, 2017 and
2016, and as of and for the years ended December 31, 2016 and 2015 were prepared in accordance with
IFRS and Brazilian GAAP.
This offering memorandum contains unaudited consolidated interim financial statements as of and
for the nine-month period ended September 30, 2017 and the notes thereto, which have been reviewed by
Grant Thornton Auditores Independentes and contains the review report of Grant Thornton Auditores
Independentes with respect thereto. The financial statements as of and for the nine-month period ended
September 30, 2017 also contain comparative information as of and for the nine-month period ended
September 30, 2016 which is derived from our unaudited consolidated interim financial statements as of
and for the nine-month period ended September 30, 2016, which are not contained in this offering
memorandum. Copies of our unaudited consolidated interim financial statements as of and for the nine-
month period ended September 30, 2016 and the review report of BDO RCS Auditores Independentes S.S.
with respect thereto can be obtained from our website at marfrig.com.br. This offering memorandum also
contains our financial information derived from our audited consolidated and individual financial
statements as of and for the year ended December 31, 2016 (which contains comparative information for
the financial year ended December 31, 2015), and the notes thereto, and contains the audit report of BDO
RCS Auditores Independentes S.S. with respect thereto. See below for further discussion. Our audited
consolidated financial statements include both guarantor and non-guarantor companies.
In accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations ("IFRS
5"), in periods where we have either disposed of, or classified for sale, an operation, we are also required
to disclose in the current period those operations' results as discontinued operations. When such conditions
exist, we are required to present the results of operations of discontinued businesses and any gain on sale
of a discontinued businesses as a single amount in our statement of income separate from our continuing
operations for the current period, to present the comparative period results of operations on a similar basis
and to present any assets held for sale separately in our consolidated balance sheet in the period in which
the transaction occurs (a prior year's balance sheet data is not required to be re-presented). During the
years ended December 31, 2016 and 2015, we disposed of, or classified for sale, certain operations, as
described below. Our unaudited consolidated interim financial statements as of and for the nine-month
periods ended September 30, 2017 and 2016 and our audited consolidated financial statements as of and
for each of the years ended December 31, 2016 and 2015 include the required disclosure of the results of
operations of the discontinued businesses.
In 2015, we sold to JBS S.A. ("JBS"), a Brazilian company, for consideration of U.S.$1.21 billion,
our entire ownership interest in certain Marfrig subsidiaries that own and operate the Moy Park business
unit ("Moy Park"). The Moy Park sale closed on September 28, 2015. In the first quarter of 2016, we also
vii

sold certain operations of our beef business unit ("Beef") consisting of: (i) four operational units of our
Marfrig Argentina S.A. subsidiary for consideration of U.S.$75.0 million; (ii) the beef jerky business of
our Marfood USA, Inc. ("Marfood") subsidiary for consideration of U.S.$3.1 million; and (iii) our
ownership interest in MFG Agropecuária Ltda. for consideration of R$95.0 million. See "Discontinued
Operations." In 2016, we decided not to dispose of the Vila Mercedes processing plant, which was
previously classified for sale in 2015 and considered Discontinued Operations (as defined below) in our
audited consolidated financial statements for the year ended December 31, 2015. In the nine-month period
ended September 30, 2017, we delivered the Vivorata and Monte Ralo units pursuant to a sales agreement
with Black Bamboo Enterprises S.A. Therefore, our financial information for the nine-month period ended
September 30, 2017 and for the year ended December 31, 2016 presented in this offering memorandum
has been reclassified in order (i) to accurately reflect the disposals that occurred in the nine-month period
ended September 30, 2017 and in the year ended December 31, 2016 and (ii) for the financial information
as of and for the nine-month period ended September 30, 2017 and as of and for the year ended December
31, 2016 presented in this offering memorandum to be comparable with financial information as of and
for the nine-month period ended September 30, 2016 and as of and for the year ended December 31, 2015,
respectively. See note 3.2 to our financial statements as of and for the nine-month period ended September
30, 2017.
For the convenience of the reader, we have attached to this offering memorandum our audited
consolidated financial statements as of and for the year ended December 31, 2015 and the notes thereto,
which have been audited by BDO RCS Auditores Independentes S.S. and contains the audit report of BDO
RCS Auditores Independentes S.S. with respect thereto, but which have not been reclassified to reflect
certain operations previously classified for sale in 2015.
Our unaudited consolidated interim statements of income and cash flow for the nine-month periods
ended September 30, 2017 and 2016 and our audited consolidated statements of income and cash flow for
the years ended December 31, 2016 and 2015 include the results of our Keystone Foods business unit
("Keystone") and our Beef business unit, which excludes our remaining Argentine operations consisting
of one processing plant ("Marfrig Beef"), reflecting their status as continuing operations (collectively, the
"Continuing Operations"), but exclude the results of operations of Moy Park and certain operations of our
Beef business unit, reflecting their status as discontinued operations (collectively, the "Discontinued
Operations"). Our consolidated statement of financial position, consolidated statement of changes in
shareholders' equity and consolidated statement of added value as of September 30, 2017 and 2016, and
as of December 31, 2016 and 2015 exclude the Discontinued Operations.
Unless otherwise indicated, all financial data contained in this offering memorandum are presented
on the basis of Continuing Operations only.
EBITDA
Marfrig's earnings before interest, taxation, depreciation and amortization ("EBITDA") consists of
net income (loss) adjusted by net financial income (expenses), income taxes and social contribution, equity
in earnings (losses) of subsidiaries and depreciation and amortization. EBITDA (continuing operations)
excludes the financial results of assets classified as discontinued operations for the periods indicated.
EBITDA (discontinued operations) sets forth the stand-alone EBITDA of Marfrig's assets classified as
discontinued operations for the periods indicated. For the year ended December 31, 2016, EBITDA
(discontinued operations) includes the loss on sale of discontinued operations of R$10.9 million after tax,
in accordance with IFRS 5. For the nine-month period ended September 30, 2017, EBITDA (discontinued
operations) includes the gain on sale of discontinued operations of R$17.8 million after tax, in accordance
with IFRS 5. EBITDA (continuing and discontinued operations) sets forth the aggregate EBITDA of our
continuing and discontinued operations for the periods indicated.
For a reconciliation of EBITDA to net income, see "Selected Financial and Other Information--
EBITDA Reconciliation." We use EBITDA as an additional measure to monitor our operating and
economic performance. EBITDA is not a measure recognized under Brazilian GAAP, IFRS or U.S. GAAP
and should not be considered individually as an alternative to net income, as a measure of operating
viii

performance, as an alternative to cash flow or as a measure of liquidity. Other companies may calculate
EBITDA in a manner that is different from ours. We publish EBITDA because we use it as a measure of
performance, and we consider EBITDA a useful measure because it is frequently used by capital markets
analysts, investors and other parties interested in evaluating companies in our industry. Because EBITDA
does not reflect financial revenues or expenses, taxes, social contribution tax or depreciation and
amortization, it is an indicator of our general financial performance, which is not affected by changes in
interest rates, debt, taxes, social contribution tax rates or rates of depreciation and amortization. As a result,
we believe that EBITDA is a useful tool to compare our operating performance in different periods, and
as a basis for certain management decisions. In addition to our general financial performance, we believe
that EBITDA also enables us to better understand our ability to discharge our liabilities and to finance our
capital expenses and working capital. However, the usefulness of EBITDA as a measure of profitability is
limited, since it does not reflect a number of the costs and expenses involved in doing business, such as
financial expenses, taxes, depreciation, capital expenses and other related costs, any of which may have a
significant effect on our net income.
Rounding
Certain amounts and percentages included in this offering memorandum have been rounded to
facilitate their presentation. The totals presented in certain tables therefore may not be exactly the sum of
the preceding amounts.
Convenience Translations into U.S. Dollars
Certain Brazilian real amounts included in this offering memorandum have been translated, solely
for the purposes of convenience for the reader, into U.S. dollars at the exchange rate as of September 30,
2017 of R$3.17 to U.S.$1.00. Where those amounts have been translated, the relevant figures have been
annotated. See "Exchange Rates."
Market Information
We have obtained the market and competitive position data, including market forecasts, used
throughout this offering memorandum from internal surveys, market research, publicly available
information and industry publications. We include data from reports prepared by us; the United States
Department of Agriculture (the "USDA"); the Brazilian Ministry of Agriculture, Livestock and Supply
(Ministério da Agricultura, Pecuária e Abastecimento, or "MAPA"); the Brazilian Ministry of
Development, Industry and Foreign Commerce (Ministério do Desenvolvimento, Indústria e Comércio
Exterior); the Brazilian Ministry of Labor and Employment (Ministério do Trabalho e Emprego, or
"MTE"); the Brazilian Foreign Trade Office (Secretaria de Comércio Exterior); the Brazilian Association
of Industrialized Meat Exporting Companies (Associação Brasileira das Indústrias Exportadoras de
Carnes); the Uruguayan National Beef Institute (Instituto Nacional de Carnes); Agra FNP, a consulting
firm specialized in agribusiness information that is a division of the Agra Informa Inc.; AC Nielsen; the
World Organisation for Animal Health; the National Supply Company (Companhia Nacional de
Abastecimentos), a Brazilian state-owned entity in charge of agricultural and supply policy, associated
with MAPA; Dom Cabral Foundation (Fundação Dom Cabral), an educational institution located in the
city of Belo Horizonte, state of Minas Gerais, in the city of Nova Lima, state of Minas Gerais, and in the
city of São Paulo, state of São Paulo; the Argentine Secretary of Agriculture, Stockbreeding, Fishing and
Food (Secretaría de Agricultura, Ganadería, Pesca y Alimentos); Center for Advanced Studies on Applied
Economics (Centro de Estudos Avançados em Economia Aplicada); the Brazilian Institute of Geography
and Statistics (Instituto Brasileiro de Geografia e Estatística, or the "IBGE"); School of Agriculture Luiz
de Queiroz (Escola Superior de Agricultura Luiz de Queiroz, or the "ESALQ"); the International Monetary
Fund ("IMF"); Brazilian Association of Meatpackers (Associação Brasileira de Frigoríficos); Watt
Publishing; the U.S. National Restaurant Association; and the Food and Agriculture Organization of the
United Nations (the "FAO"), among others. Industry publications, including the ones referred to in this
offering memorandum, generally state that the information presented in that publication has been obtained
from sources believed to be reliable, but that the accuracy and completeness of the information is not
ix

guaranteed. Similarly, internal surveys, industry forecasts and market research, while believed to be
reliable, have not been independently verified, and neither we nor the initial purchasers make any
representation as to the accuracy of the information. Information from third parties has been accurately
reproduced and as far as we are aware, and are able to ascertain from information published by that third
party, no facts have been omitted which would render the reproduced information inaccurate or
misleading.
Operational Information
Unless otherwise indicated, all production, plant and capacity data contained in this offering
memorandum are presented on the basis of Continuing Operations only.
Covenant Net Debt
This offering memorandum contains information with respect to our net debt as adjusted to take into
account the difference in the value in reais of our foreign currency denominated debt as of the date of the
incurrence of such debt (using the then current exchange rate) and as of the last day of the most recent
financial statements available ("Covenant Net Debt"). The exchange rate difference as of September 30,
2017 and 2016 were R$6,617.1 million (U.S.$2,087.4 million) and R$3,519.7 million (U.S.$1,083.0
million), respectively. See note 20.3 to our financial statements as of and for the nine-month period ended
September 30, 2017. Covenant Net Debt is calculated pursuant to the terms of our financing agreements
for the purposes of compliance with certain financial covenants therein, including Covenant Net
Debt/EBITDA ratio. See "--EBITDA" and "Selected Financial and Other Information--EBITDA
Reconciliation."
x