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As filed with the Securities and Exchange Commission on July 12, 2023.

Registration No. 333-          

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form F-4

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

 

 

JBS B.V.*

(Exact Name of Registrant as Specified in its Charter)

 

 

 

The Netherlands   2011   Not Applicable
(State or Other Jurisdiction of
Incorporation or Organization)
 

(Primary Standard Industrial

Classification Code Number)

  (I.R.S. Employer
Identification No.)

Stroombaan 16, 5th Floor,

1181 VX, Amstelveen, Netherlands

+31 20 656 47 00

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

 

 

JBS USA Food Company

1770 Promontory Circle

Greeley, Colorado 80634

+1 (970) 506-8000

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

 

Copies to:

Donald E. Baker, Esq.

John R. Vetterli, Esq.

Karen Katri, Esq.

White & Case LLP

1221 Avenue of the Americas

New York, New York 10020

+1 (212) 819-8200

 

 

Approximate date of commencement of proposed sale to the public: As soon as practicable on or after effectiveness of this registration statement.

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)  ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company  ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act.  ☐

 

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

 

 

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

 

*

The Registrant intends to convert its legal form under Dutch law from a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) to a public limited liability company (naamloze vennootschap) and to change its name to “JBS N.V.” prior to the closing of the proposed transaction.

 

 

 


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EXPLANATORY NOTE

JBS B.V., a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under Dutch law, is filing this registration statement on Form F-4 (this “Registration Statement”) to register the offering of JBS N.V. Class A Common Shares (initially in the form of JBS N.V. BDRs), which is the result of the Redemption (as defined below) immediately following the Merger of Shares (as defined below) that are part of a proposed corporate restructuring (the “Restructuring”) of JBS S.A., a corporation (sociedade anônima) incorporated under the laws of Brazil (“JBS S.A.”), and its subsidiaries (collectively, the “JBS Group”) and the conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period (as defined below) (the “Conversion”). Upon the completion of the Restructuring, JBS N.V. (as JBS B.V. is expected to be known upon its renaming and conversion into a public limited liability company (naamloze vennootschap) under Dutch law, or “JBS N.V.”, which definition is meant to include JBS B.V. prior to the conversion of the company into a Dutch public limited liability company) will be the ultimate holding company of the JBS Group. Following the completion of the Restructuring, holders of common shares of JBS S.A. (“JBS S.A. Common Shares”) on the last day the JBS S.A. Common Shares will trade on the B3 (as defined below) (the “Last Trading Day”) will become shareholders of JBS N.V., and JBS S.A. will be an indirect wholly-owned subsidiary of JBS N.V.

Upon completion of the Restructuring, the issued capital of JBS N.V. will consist of two classes of common shares: (1) Class A common shares, par value €0.01 per share (“JBS N.V. Class A Common Shares”); and (2) Class B common shares, par value of €0.10 per share (“JBS N.V. Class B Common Shares” and, together with the JBS N.V. Class A Common Shares, the “JBS N.V. Common Shares”). JBS N.V. intends to apply to have the JBS N.V. Class A Common Shares listed for trading on the New York Stock Exchange. JBS N.V. also intends to sponsor a Brazilian Depositary Receipt (“BDR”) program to permit JBS N.V. Class A Common Shares represented by BDRs (“JBS N.V. BDRs”) to be listed for trading on the São Paulo Stock Exchange (B3 S.A. - Brasil, Bolsa, Balcão) (“B3”). We will not seek a listing for the JBS N.V. Class B Common Shares. The JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will have the same economic and voting rights, except that JBS N.V. Class B Common Shares will be entitled to 10 votes per share and JBS N.V. Class A Common Shares will be entitled to one vote per share at a general meeting of shareholders of JBS N.V.

The steps of the Restructuring are as follows:

Step 1: As the first step in the Restructuring, JBS N.V. will, through a series of transactions, become the indirect controlling shareholder of JBS S.A. On July 7, 2023, J&F Investimentos S.A., a corporation (sociedade por ações) incorporated under the laws of Brazil (“J&F”), and Fundo de Investimento em Participações Multiestratégia Formosa, a Brazilian investment fund (“FIP Formosa” and, together with J&F, JBS S.A.’s “controlling shareholders”), entered into a binding and unconditional agreement with JBS N.V., JBS Participações Societárias S.A., a Brazilian corporation (sociedade por ações) (“HoldCo”) and J&F Investments Luxembourg S.à r.l., a private limited liability company (société à responsabilité limitée) incorporated and existing under the laws of Luxembourg (“LuxCo”), pursuant to which: (1) JBS S.A.’s controlling shareholders will contribute and transfer all of their JBS S.A. Common Shares at book value to LuxCo; (2) immediately thereafter, LuxCo will contribute and transfer all such JBS S.A. Common Shares at book value to JBS N.V. in exchange for 243,704,227 JBS N.V. Class A Common Shares and 297,860,722 JBS N.V. Class B Common Shares (whereby the difference in the value of the JBS S.A. Common Shares and the aggregate nominal value of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will be added to the general share premium reserve maintained by JBS N.V.); and (3) immediately thereafter, JBS N.V. will contribute and transfer such JBS S.A. Common Shares at book value to HoldCo in exchange for common shares of HoldCo. These transactions and transfers of equity interests must be consummated and completed no later than December 31, 2023. As a result of this step, JBS N.V. will, through HoldCo, indirectly hold the shares of JBS S.A. that are currently held directly by JBS S.A.’s controlling shareholders. Accordingly, JBS N.V. will become the indirect controlling shareholder of JBS S.A. This step will be subject to the same exchange ratio of one JBS N.V. Common Share for every two JBS S.A. Common Shares that will be applied to JBS S.A.’s non-controlling shareholders pursuant to the Merger of Shares and Redemption (defined below), which will result in each JBS


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S.A. shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described in this prospectus. However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V., the voting power of our controlling shareholders (held indirectly, through LuxCo) may increase substantially in relation to our non-controlling shareholders as a result of the aforementioned steps, depending on the number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares during the Class A Conversion Period (as defined below).

Step 2: As the second and final step in the Restructuring, subject to approval by a general meeting of shareholders of JBS S.A. (the “JBS S.A. General Meeting”) and a general meeting of shareholders of HoldCo (the “HoldCo General Meeting”), as the case may be, holders of JBS S.A. Common Shares on the Last Trading Day will receive JBS N.V. BDRs and a cash dividend on the terms defined below (the “Proposed Transaction”):

 

   

Merger of Shares. Subject to approval at the JBS S.A. General Meeting, a merger of shares (incorporação de ações) under Brazilian law (the “Merger of Shares”) will be implemented pursuant to which every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo will be automatically contributed for their book value into HoldCo in exchange for one newly issued mandatorily redeemable preferred share of HoldCo (“HoldCo Redeemable Shares”), as a result of which JBS S.A. will become a wholly-owned subsidiary of HoldCo. The HoldCo Redeemable Shares will be mandatorily redeemable for JBS N.V. BDRs.

 

   

Redemption. Immediately after the Merger of Shares is approved at the JBS S.A. General Meeting, JBS N.V., as sole shareholder of HoldCo, will approve at the HoldCo General Meeting the redemption of all of the HoldCo Redeemable Shares and deliver to each holder thereof one JBS N.V. BDR for every one HoldCo Redeemable Share held (the “Redemption”). If such holder wants to receive the underlying JBS N.V. Class A Common Shares, the JBS N.V. BDRs must be cancelled.

 

   

Cash Dividend. Subject to approval at the JBS S.A. General Meeting, all JBS S.A. shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a cash dividend.

For a period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026 (the “Class A Conversion Period”), each person entitled to one or more JBS N.V. BDRs at the opening of trading on the first day the JBS N.V. BDRs will trade on the B3 (the “Conversion Record Date”), who is entitled to such JBS N.V. BDRs in connection with the Proposed Transaction (an “Eligible Shareholder”), may request, after having cancelled its relevant JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. BDRs to which the Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction) (the “Maximum Convertible Shares”). Except with respect to conversion requests submitted during the Last Conversion Quarter (as defined below), the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to 55% of such Eligible Shareholder’s Maximum Convertible Shares (the “Maximum Conversion Rate”). During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the last quarter prior to the close of the Class A Conversion Period (i.e., the fourth quarter of 2026) (the “Last Conversion Quarter”), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A


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Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the number of JBS N.V. Class A Common Shares held by non-controlling shareholders, (being at the time of the Proposed Transaction all shareholders of JBS N.V. except LuxCo) divided by the total number of JBS N.V. Common Shares outstanding multiplied by 100% (the “JBS N.V. Free Float Percentage”) on December 31, 2026 to fall below 20% (the “Minimum Free Float”), the number of JBS N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date. For the avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes. Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be. Following the end of each fiscal quarter, JBS N.V. will disclose to the market the number of JBS N.V. Class A Common Shares that were converted into JBS N.V. Class B Common Shares pursuant to the procedures described above. Following the Class A Conversion Period, JBS N.V. Class A Common Shares will no longer be convertible into JBS N.V. Class B Common Shares. However, JBS N.V. Class B Common Shares may at any time be converted into JBS N.V. Class A Common Shares.

This Registration Statement includes a prospectus for the JBS N.V. Class A Common Shares and JBS N.V. BDRs that will be issued to holders of JBS S.A. Common Shares as part of the consideration upon completion of the Proposed Transaction and the JBS N.V. Class B Common Shares into which JBS N.V. Class A Common Shares may be converted as part of the Conversion and held by Eligible Shareholders.


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The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

 

SUBJECT TO COMPLETION, DATED                 , 2023

PRELIMINARY PROSPECTUS

 

 

LOGO

TRANSACTION PROPOSED

JBS N.V.

567,493,236 Class A Common Shares (including Class A Common Shares in the form of Brazilian Depositary Receipts) Up to 345,681,599 Class B Common Shares

Dear JBS S.A. Shareholder:

This prospectus relates to: (1) 567,493,236 Class A common shares, par value €0.01 per share (“JBS N.V. Class A Common Shares”), of JBS N.V. (as JBS B.V. is expected to be known upon its renaming and conversion into a public limited liability company (naamloze vennootschap) under Dutch law, or “JBS N.V.”, which definition is meant to include JBS B.V. prior to the conversion of the company into a Dutch public limited liability company), including JBS N.V. Class A Common Shares in the form of Brazilian Depositary Receipts (“BDRs”), each representing one JBS N.V. Class A Common Share (“JBS N.V. BDRs”), to be issued to holders of common shares of JBS S.A. (“JBS S.A. Common Shares”), a Brazilian corporation (sociedade anônima) (“JBS S.A.”) listed on the São Paulo Stock Exchange (B3 S.A.—Brasil, Bolsa, Balcão) (“B3”), pursuant to the terms of the Proposed Transaction (as defined below) and subject to the satisfaction of certain conditions described in this prospectus; and (2) up to 345,681,599 Class B common shares, par value €0.10 per share (“JBS N.V. Class B Common Shares” and, together with the JBS N.V. Class A Common Shares, the “JBS N.V. Common Shares”), of JBS N.V. into which JBS N.V. Class A Common Shares may be converted during the Class A Conversion Period (as defined below), which will take place after the completion of the Proposed Transaction. References to “the JBS Group” are to: (i) JBS S.A. and its consolidated subsidiaries prior to the completion of the Proposed Transaction; and (ii) JBS N.V. and its consolidated subsidiaries (including JBS S.A.), following the completion of the Proposed Transaction, unless the context otherwise requires or otherwise indicated.

The Proposed Transaction is part of a corporate restructuring of the JBS Group with the purpose of listing the JBS N.V. Class A Common Shares on the New York Stock Exchange (“NYSE”) and the JBS N.V. BDRs on the B3. Prior to the Closing Date (as defined in the section “Certain Defined Terms”), the controlling shareholders of JBS S.A. (as defined in the section “Certain Defined Terms”) will transfer their interest in JBS S.A. to JBS N.V. Following the completion of the Proposed Transaction, JBS S.A. will be an indirect wholly-owned subsidiary of JBS N.V., and the JBS S.A. Common Shares will no longer be publicly traded.

Pursuant to the Proposed Transaction, holders of JBS S.A. Common Shares (“JBS S.A. Shareholders”) will receive JBS N.V. BDRs and a cash dividend on the terms defined below. The proposed transaction will consist of the three steps below (collectively, the “Proposed Transaction”):

 

   

Merger of Shares. Subject to approval at the general meeting of shareholders of JBS S.A. scheduled for              , 2023 (“JBS S.A. General Meeting”), on the Closing Date, the merger of shares will be implemented through an incorporação de ações under the Brazilian Corporation Law (as defined in the section “Certain Defined Terms”) (the “Merger of Shares”). Pursuant to the Merger of Shares, every two JBS S.A. Common Shares issued and outstanding on the last day the JBS S.A. Common Shares will trade on the B3 (the “Last Trading Day”) that are not held by JBS Participações Societárias S.A., a Brazilian corporation (sociedade por ações) (“HoldCo”) that will be wholly owned by JBS N.V. prior to the Closing Date, will be automatically contributed for their book value into HoldCo in exchange for one newly issued mandatorily redeemable preferred share of HoldCo (“HoldCo Redeemable Shares”), determined pursuant to the Exchange Ratio (as defined in the section “Certain Defined Terms”), and JBS S.A. will become a wholly-owned subsidiary of HoldCo. The HoldCo Redeemable Shares are mandatorily redeemable for JBS N.V. BDRs.

 

   

Redemption. Immediately after the Merger of Shares is approved at the JBS S.A. General Meeting, JBS N.V., as sole shareholder of HoldCo, will approve at a general meeting of shareholders of HoldCo


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scheduled for              , 2023 (the “HoldCo General Meeting”) the redemption of all of the HoldCo Redeemable Shares and deliver to each holder thereof one JBS N.V. BDR for every one HoldCo Redeemable Share held (the “Redemption”). If such holder wants to receive the underlying JBS N.V. Class A Common Shares, the JBS N.V. BDRs may be cancelled at any time, and from time to time, on or after about two business days after the Closing Date.

 

   

Cash Dividend. Subject to approval at the JBS S.A. General Meeting, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a cash dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held (the “Cash Dividend”). The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

JBS S.A. Shareholders will have the opportunity to vote on the Proposed Transaction at the JBS S.A. General Meeting. The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol (as defined in the section “Certain Defined Terms”) and related valuation reports, as described under the caption “JBS S.A. General Meeting—Agenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares. The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting. In addition, holders of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding (as defined in the section “Certain Defined Terms”) present at the JBS S.A. General Meeting must approve the delisting of the JBS S.A. Common Shares from the Novo Mercado listing segment of the B3 (the “Delisting”). For more information about the percentage of shareholders required to approve each matter being voted upon at the JBS S.A. General Meeting, see “JBS S.A. General Meeting—Required Vote.” Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.” Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters.

The JBS S.A. General Meeting will be cancelled or postponed and will not occur if the registration statement on Form F-4 of which this prospectus is a part is not declared effective prior to the date the meeting is called. In order to approve the Merger of Shares, holders of at least the majority of the outstanding JBS S.A. Common Shares, voting together, must vote in favor of the Proposed Transaction. The completion of the Proposed Transaction is subject to the satisfaction or waiver of certain conditions, as further described below.

The Exchange Ratio is defined in the section “Certain Defined Terms.” The Exchange Ratio has been established so that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) receives, upon completion of the Proposed Transaction, one JBS N.V. BDR for every two JBS S.A. Common Shares that it holds. Prior to the completion of the Proposed Transaction, our controlling shareholders (through LuxCo) will have received one JBS N.V. Class A Common Share or one JBS N.V. Class B Common Share for every two JBS S.A. Common Shares held. This will result in each JBS S.A. Shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. Shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs, as described below, and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.”

Following the Closing Date, any fractional JBS N.V. BDRs attributed to JBS S.A. Shareholders resulting from the Merger of Shares and the Redemption will be grouped into whole numbers and sold on the open market managed by B3, as applicable. The net proceeds from the sale of the fractional JBS N.V. BDRs will be distributed


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on a pro rata basis to the former JBS S.A. Shareholders who contributed their JBS S.A. Common Shares to HoldCo in the Merger of Shares. Excluding the Cash Dividend, no additional consideration in cash or in kind will be paid to JBS S.A. Shareholders in connection with the Proposed Transaction.

In connection with the Proposed Transaction, HoldCo may be required to withhold and collect Brazilian taxes imposed on capital gains assessed, if any, due by certain non-Brazilian JBS S.A. Shareholders that hold their investment under the special tax regime of CMN Resolution No. 4,373/2014 (“4,373 Holders”). In order to determine whether any withholding will be required, each 4,373 Holder must report, through its Brazilian custodian or broker dealer, certain information relating to such 4,373 Holder’s historical cost and tax domiciliation. Such information must be provided after the JBS S.A. General Meeting, in accordance with the procedures that will be publicly announced prior to the date of the JBS S.A. General Meeting. If HoldCo determines based on such information that withholding will be required, or if such 4,373 Holder fails to provide such information, HoldCo has the right, at its sole discretion, to: (1) deduct any amount required to be withheld by HoldCo from the Cash Dividend payable by JBS S.A. to such 4,373 Holder; and (2) retain JBS N.V. BDRs which such 4,373 Holder is entitled to receive, in an amount sufficient to generate cash payment sufficient to cover any required tax withholding, and HoldCo will retain such amount upon sale of such BDRs. See “Material Tax Considerations—Material Brazilian Tax Considerations.”

At any time, and from time to time, on or about two business days after the Closing Date, a holder of JBS N.V. BDRs that wants to receive JBS N.V. Class A Common Shares may request the cancellation of all or a portion of its JBS N.V. BDRs by: (1) instructing its broker or custodian operating in Brazil to cancel its JBS N.V. BDRs with                 , in its capacity as depositary for the JBS N.V. BDRs (the “JBS N.V. BDR Depositary Bank”); and (2) delivering evidence that all fees and potential taxes due in connection with this service were duly paid, as set forth in the JBS N.V. BDR Deposit Agreement (as defined in the section “Certain Defined Terms”). The cancellation instruction to the broker or custodian must include an appropriate brokerage account outside of Brazil to receive the underlying JBS N.V. Class A Common Shares. See “The Proposed Transaction—Receiving JBS N.V. Class A Common Shares.”

For a period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026 (the “Class A Conversion Period”), each person entitled to one or more JBS N.V. BDRs at the opening of trading on the first day the JBS N.V. BDRs will trade on the B3 (the “Conversion Record Date”), who is entitled to such JBS N.V. BDRs in connection with the Proposed Transaction (an “Eligible Shareholder”), may request, after having cancelled its relevant JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. BDRs to which the Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction) (the “Maximum Convertible Shares”). Except with respect to conversion requests submitted during the Last Conversion Quarter (as defined below), the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to 55% of such Eligible Shareholder’s Maximum Convertible Shares (the “Maximum Conversion Rate”). During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the last quarter prior to the close of the Class A Conversion Period (i.e., the fourth quarter of 2026) (the “Last Conversion Quarter”), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the number of JBS N.V. Class A Common Shares held by non-controlling shareholders (being at the time of the Proposed Transaction all shareholders of JBS N.V. except LuxCo) divided by the total number of JBS N.V. Common Shares outstanding multiplied by 100% (the “JBS N.V. Free Float Percentage”) on December 31, 2026 to fall below 20% (the “Minimum Free Float”), the number of JBS N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A


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Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date. For the avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes. Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be. Following the end of each fiscal quarter, JBS N.V. will disclose to the market the number of JBS N.V. Class A Common Shares that were converted into JBS N.V. Class B Common Shares pursuant to the procedures described above. Following the Class A Conversion Period, JBS N.V. Class A Common Shares will no longer be convertible into JBS N.V. Class B Common Shares. However, JBS N.V. Class B Common Shares may at any time be converted into JBS N.V. Class A Common Shares. For more information, see “The Proposed Transaction—Class A Conversion Period.”

Upon completion of the Proposed Transaction, JBS N.V.’s issued share capital will consist of the: (1) JBS N.V. Class A Common Shares and (2) JBS N.V. Class B Common Shares. Each JBS N.V. Class A Common Share confers the right to one vote at a general meeting of shareholders. Each JBS N.V. Class B Common Share confers the right to 10 votes at a general meeting of shareholders. Currently, there is no public market for the JBS N.V. Common Shares. We intend to apply to list the JBS N.V. Class A Common Shares on the NYSE under the symbol “JBS”. We also intend to apply to list the JBS N.V. BDRs on the B3 under the symbol “                ”. We will not seek a listing for the JBS N.V. Class B Common Shares on the NYSE or on any other exchange. Trades in JBS N.V. Class A Common Shares are expected to settle through the facilities of The Depository Trust Company (“DTC”), and trades in JBS N.V. BDRs on the B3 will settle through the facilities of the Central Depositary of the B3.

The opening price of the JBS N.V. BDRs on the B3 will be equivalent to the closing price of the JBS S.A. Common Shares on the Last Trading Day, as adjusted by the Exchange Ratio. We expect that the opening price of the JBS N.V. Class A Common Shares on the NYSE will be determined by buy and sell orders collected by the NYSE from broker-dealers. Based on such orders, the designated market maker will determine an opening price for the JBS N.V. Class A Common Shares. However, prior to the opening trade, there will not be a price at which underwriters initially sell the JBS N.V. Class A Common Shares to the public as there would be in a traditional underwritten initial public offering. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, upon listing on the NYSE, the public trading price of the JBS N.V. Class A Common Shares may be more volatile than in a traditional underwritten initial public offering and could decline significantly and rapidly. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.

To permit delivery of JBS N.V. BDRs upon completion of the Proposed Transaction, JBS N.V. will apply for its registration as a foreign issuer in Brazil and for the registration of its BDR Program with the Brazilian


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Securities Commission (Comissão de Valores Mobiliários (“CVM”). After the Closing Date, a holder of JBS N.V. Class A Common Shares will be able to deposit its JBS N.V. Class A Common Shares with the JBS N.V. BDR Depositary Bank and receive JBS N.V. BDRs, and a holder of JBS N.V. BDRs will be able to cancel its JBS N.V. BDRs and receive underlying JBS N.V. Class A Common Shares (see “Description of BDRs and Deposit Agreement”). Additionally, in connection with the listing of JBS N.V. BDRs, JBS N.V. expects to apply to have its BDRs classified as Level II BDRs pursuant to Brazilian regulation, in which case JBS N.V. will be required to obtain a registration as a foreign issuer in Brazil before the CVM and, consequently, comply with certain disclosure requirements set forth in the Brazilian regulation, including annually filing a formulário de referência (a document which contains financial, legal and operating information about the filer), providing quarterly financial information and certain periodical filings disclosing material events.

Upon completion of the Proposed Transaction, the JBS S.A. Common Shares will no longer be listed on B3 or any other exchange. JBS S.A. will become a wholly owned subsidiary of HoldCo.

Immediately upon completion of the Proposed Transaction, our controlling shareholders will own (indirectly, through LuxCo) 100% of the issued and outstanding JBS N.V. Class B Common Shares and 30.04% of the issued and outstanding JBS N.V. Class A Common Shares, which will in the aggregate represent a majority of the voting power in the general meeting of shareholders of JBS N.V., and will effectively control all matters requiring shareholder approval. Assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023, our controlling shareholders will (indirectly, through LuxCo) hold 48.83% of the then-outstanding JBS N.V. Common Shares and 85.03% of the aggregate voting power in JBS N.V, which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. The exact percentage of the then-outstanding JBS N.V. Shares and aggregate voting power in JBS N.V. that will be (indirectly) held by our controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the percentage of JBS S.A. shares that they hold on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

We will be considered a “foreign private issuer” under U.S. securities laws and the NYSE rules, and we intend to rely on corporate governance exemptions available to foreign private issuers under NYSE rules. See “Management—Corporate Governance Practices” for more information. We may also be a “controlled company” within the meaning of the corporate governance standards of the NYSE. Under NYSE rules, a “controlled company” (which is a company of which more than 50% of the voting power is held by an individual, group or another company) may elect not to comply with certain NYSE corporate governance standards. See “Management—Corporate Governance Practices” for more information. If we were to lose our foreign private issuer status but remain a controlled company, we may elect in the future to avail ourselves of the “controlled company” exemptions under NYSE corporate governance rules. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—As a foreign private issuer, we are permitted to follow certain home country corporate governance practices instead of otherwise applicable NYSE requirements.”

None of the Securities and Exchange Commission (the “SEC”), the CVM, nor any securities commission of any jurisdiction has approved or disapproved any of the transactions described in this


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prospectus or the securities to be issued under this document or passed upon the adequacy or accuracy of this document. Any representation to the contrary is a criminal offense. This prospectus does not constitute an offer to buy or sell, or a solicitation of an offer to buy or sell, any securities, or a solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. For the avoidance of doubt, this prospectus does not constitute an offer to buy or sell securities or a solicitation of an offer to buy or sell any securities in the Federative Republic of Brazil or a solicitation of a proxy under the laws the Federative Republic of Brazil, and it is not intended to be, and is not, a prospectus or an offer document within the meaning of Brazilian law and the rules of the CVM. You should inform yourself about and observe any such restrictions, and none of JBS N.V., JBS S.A. or their respective subsidiaries accepts any liability in relation to any such restrictions.

This prospectus does not constitute an offer of securities to the public in the European Union within the meaning of Article 3(1) of the Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017, as amended, (the “Prospectus Regulation”) and is not a prospectus or an offer document within the meaning of the Prospectus Regulation.

WE ARE NOT ASKING FOR A PROXY. The accompanying disclosure documents contain detailed information about the Proposed Transaction and the JBS S.A. General Meeting. This document is a prospectus for JBS N.V. Class A Common Shares and JBS N.V. BDRs that will be issued to holders of JBS S.A. Common Shares as part of the consideration upon completion of the Proposed Transaction and the JBS N.V. Class B Common Shares into which JBS N.V. Class A Common Shares may be converted as part of the Conversion and held by Eligible Shareholders. You should read this prospectus carefully. In particular, please read the section Risk Factors beginning on page 21 for a discussion of risks that you should consider in evaluating the Proposed Transaction described in this prospectus.

The date of this prospectus is                 , 2023.


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TABLE OF CONTENTS

 

     PAGE  

IMPORTANT DATES

     iii  

CERTAIN DEFINED TERMS

     iv  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     xi  

PRESENTATION OF FINANCIAL AND OTHER INFORMATION

     xiii  

QUESTIONS AND ANSWERS ABOUT THE PROPOSED TRANSACTION, THE JBS S.A. GENERAL MEETING AND JBS N.V.

     xvii  

SUMMARY

     1  

RISK FACTORS

     21  

CAPITALIZATION

     56  

PER SHARE, DIVIDEND AND MARKET PRICE DATA

     58  

JBS S.A. GENERAL MEETING

     61  

THE PROPOSED TRANSACTION

     64  

INFORMATION ABOUT JBS N.V.

     82  

INFORMATION ABOUT JBS S.A.

     84  

THE GLOBAL PROTEIN INDUSTRY

     129  

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     133  

DESCRIPTION OF MATERIAL INDEBTEDNESS

     174  

MANAGEMENT

     182  

PRINCIPAL SHAREHOLDERS

     190  

RELATED PARTY TRANSACTIONS

     200  

DESCRIPTION OF SHARE CAPITAL

     204  

COMPARISON OF THE RIGHTS OF HOLDERS OF JBS N.V. SHARES AND JBS S.A. COMMON SHARES

     232  

DESCRIPTION OF JBS N.V. BDRS AND DEPOSIT AGREEMENT

     251  

SHARES ELIGIBLE FOR FUTURE SALE

     257  

TAXATION

     260  

EXPENSES OF THE PROPOSED TRANSACTION

     281  

DETERMINATION OF OFFERING PRICE

     281  

LEGAL MATTERS

     282  

EXPERTS

     283  

ENFORCEABILITY OF CIVIL LIABILITIES

     285  

WHERE YOU CAN FIND ADDITIONAL INFORMATION

     288  

INDEX TO FINANCIAL STATEMENTS

     F-1  

 

 

This document, which is part of a registration statement on Form F-4 filed with the SEC by JBS N.V., constitutes a prospectus of JBS N.V. under Section 5 of the U.S. Securities Act of 1933, as amended (“Securities Act”), with respect to JBS N.V. Class A Common Shares and JBS N.V. BDRs to be issued to holders of JBS S.A. Common Shares, pursuant to the transactions described herein.

No person has been authorized to provide you with information that is different from what is contained in this prospectus, and, if given or made by any person, such information must not be relied upon as having been authorized. You should not assume that the information contained in this prospectus is accurate as of any date other than the date set forth on the cover or such other previous reference date expressly mentioned in this prospectus. Changes to the information contained in this prospectus may occur after that date, and we undertake no obligation to update the information, except as required by law.

 

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Any reference to a website address does not constitute incorporation by reference of the information contained at or available through such website, and you should not consider it to be a part of this prospectus.

This prospectus is not an offer to sell and it is not a solicitation of an offer to buy securities in any jurisdiction in which the offer or sale thereof is not permitted. Countries outside the United States generally have their own legal requirements that govern securities offerings made to persons resident in those countries and often impose stringent requirements about the form and content of offers made to the general public.

Non-U.S. shareholders should consult their advisors in considering whether there are any restrictions or limitations on transactions in the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs that may apply in their home countries. Neither JBS N.V. nor JBS S.A. can provide any assurance about whether such limitations may exist.

 

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IMPORTANT DATES

JBS S.A. Shareholders should take note of the following expected important dates in connection with the Proposed Transaction:

 

Date / Period

  

Event

                , 2023    Termination of JBS S.A. ADS Program
                , 2023    Approval by the board of directors of JBS S.A. to convene the JBS S.A. General Meeting
On or about                , 2023    Formal notice convening the JBS S.A. General Meeting, published in the official gazette and a major newspaper, as required under Brazilian law
On or about                , 2023   

JBS S.A. General Meeting*

 

HoldCo General Meeting

On or about                 , 2023    Restructuring – First Step: Contribution of JBS S.A. Common Shares held by the controlling shareholders to LuxCo, contribution of JBS S.A. Common Shares held by LuxCo to JBS B.V. and contribution of JBS S.A. Common Shares held by JBS B.V. to HoldCo
On or about                 , 2023    Conversion of JBS B.V. into JBS N.V.
On or about                 , 2023    Last Trading Day (JBS S.A. Common Shares)
On or about                 , 2023    Restructuring – Second Step: Closing Date (Merger of Shares and Redemption)
On or about                 , 2023    First day of trading of JBS N.V. BDRs on the B3
On or about                 , 2023    First day holders of JBS N.V. BDRs can request cancellation of JBS N.V. BDRs
On or about                 , 2023    First day of trading of JBS N.V. Class A Common Shares on the NYSE
On or about                 , 2023    Beginning of Class A Conversion Period
December 31, 2026    End of Class A Conversion Period

 

*

The JBS S.A. General Meeting scheduled for                 , 2023 will be cancelled and will not occur if the registration statement on Form F-4 of which this prospectus is a part is not declared effective prior to the date the meeting is called.

There is no record date for purposes of determining direct JBS S.A. Shareholders entitled to attend the JBS S.A. General Meeting or to vote. JBS S.A. Shareholders on the date of the JBS S.A. General Meeting are entitled to attend the JBS S.A. General Meeting and vote on the items set forth on the agenda, as long as they have timely provided the appropriate documentation required by JBS S.A. at the time of the call notice to the JBS S.A. General Meeting, which required documentation will be set out in the notice of the JBS S.A. General Meeting and/or in the documents relating thereto.

Subject to approval at the JBS S.A. General Meeting, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting, will be entitled to receive the Cash Dividend. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

 

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CERTAIN DEFINED TERMS

Except where the context otherwise requires, in this prospectus:

 

   

“JBS N.V.” or the “issuer” refers to JBS N.V., as JBS B.V. is expected to be known upon its renaming and conversion into a public limited liability company (naamloze vennootschap) under Dutch law prior to the Closing Date. For the avoidance of doubt, this definition is meant to include JBS B.V. prior to the conversion of the company into a Dutch public limited liability company.

 

   

“JBS S.A.” refers to JBS S.A., a Brazilian corporation (sociedade anônima).

 

   

“JBS Group,” “we,” “our,” “us,” “our company” or like terms refer to: (1) JBS S.A. and its consolidated subsidiaries prior to the completion of the Proposed Transaction; and (2) JBS N.V. and its consolidated subsidiaries (including JBS S.A.), following the completion of the Proposed Transaction, unless the context otherwise requires or otherwise indicated.

The issuer was incorporated on October 9, 2019 as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under Dutch law, with its corporate seat (statutaire zetel) in Amsterdam, the Netherlands, with the name “Violet Holdings B.V.” On February 3, 2020, its name was changed to “Swift Foods B.V.” and, on November 17, 2022, its name was changed to “JBS B.V.” Prior to the Closing Date, the issuer will be converted into a public limited liability company (naamloze vennootschap) under Dutch law with the name “JBS N.V.” As of the date of this prospectus, the issuer is a wholly-owned subsidiary of JBS S.A. and has no revenues or business operations or material assets, liabilities or contingencies. JBS S.A. intends to transfer the issuer to LuxCo prior to the first step of the Restructuring described in this prospectus.

In addition, in this prospectus, except where otherwise indicated or where the context requires otherwise:

 

   

“ADS” means American Depositary Share.

 

   

“Australia” means the Commonwealth of Australia.

 

   

“BDR” means Brazilian Depositary Receipt.

 

   

“BNDES” means the Brazilian Economic and Social Development Bank (Banco Nacional de Desenvolvimento Econômico e Social—BNDES).

 

   

“BNDESPar” means BNDES Participações S.A., a corporation (sociedade por ações) incorporated under the laws of Brazil and wholly owned by BNDES. For more information, see “Principal Shareholders.”

 

   

“B3” or “São Paulo Stock Exchange” means B3 S.A. – Brasil, Bolsa, Balcão.

 

   

“Brazil” means the Federative Republic of Brazil.

 

   

“Brazilian Corporation Law” means the Brazilian Law No. 6,404/76, as amended.

 

   

“Brazilian real,” “Brazilian reais” or “R$” means the Brazilian real, the official currency of Brazil.

 

   

“Brazilian Central Bank” means the Central Bank of Brazil (Banco Central do Brasil).

 

   

“Cash Dividend” means the proposed cash dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share, to be paid to all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting, subject to approval at the JBS S.A. General Meeting. The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. For more information, see “The Proposed Transaction.”

 

   

“Class A Conversion Period” means the period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026. During the Class A Conversion Period, Eligible Shareholders may request to convert all or a portion of their JBS N.V. Class A Common Shares,

 

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up to the Maximum Convertible Shares, into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held, subject to the Minimum Free Float requirement. In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. For the avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“Class A Conversion Request” means a written request by an Eligible Shareholder or LuxCo addressed to our board of directors indicating, among other information, the number of JBS N.V. Class A Common Shares that such Eligible Shareholder or LuxCo, as the case may be, is requesting to convert into JBS N.V. Class B Common Shares. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“Closing Date” means the date on which the Merger of Shares and the Redemption will take place, resulting in: (1) as it relates to the Merger of Shares, the contribution of every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo in exchange for one newly issued HoldCo Redeemable Share; and (2) as it relates to the Redemption, the immediate redemption by HoldCo of all of its HoldCo Redeemable Shares for JBS N.V. BDRs.

 

   

“CMN” means the Brazilian Monetary Council (Conselho Monetário Nacional).

 

   

“controlling shareholders” means J&F and FIP Formosa. Following the completion of the Proposed Transaction, J&F and FIP Formosa will hold their shares in JBS N.V. through LuxCo. See “Principal Shareholders.”

 

   

“Conversion” means the conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“Conversion Record Date” means the first day the JBS N.V. BDRs will trade on the B3. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“CVM” means the Brazilian Securities Commission (Comissão de Valores Mobiliários).

 

   

“Delisting” means the delisting of the JBS S.A. Common Shares from the Novo Mercado listing segment of B3.

 

   

“DOJ” means the U.S. Department of Justice.

 

   

“DTC” means The Depository Trust Company.

 

   

“Eligible Shareholder” means a person entitled to one or more JBS N.V. BDRs at the opening of trading on the Conversion Record Date who is entitled to such JBS BDRs in connection with the Proposed Transaction. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares (the “Maximum Convertible Shares”) equals the number of JBS N.V. BDRs to which the Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction). For more information, see “The Proposed Transaction.”

 

   

“Empire Acquisition” means JBS USA’s acquisition of Empire Packing Company, L.P.’s case ready production facilities and Ledbetter branded retail products. The Empire Acquisition was completed on April 6, 2020. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Empire Acquisition.”

 

   

“EUR” or “€” means the Euro, the official currency of the European Economic Area.

 

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“Exchange Act” means the United States Securities Exchange Act of 1934, as amended.

 

   

“Exchange Ratio” means the number of HoldCo Redeemable Shares that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) will receive per JBS S.A. Common Share in consideration for the Merger of Shares. On the Closing Date, JBS S.A. Shareholders (excluding the controlling shareholders, through HoldCo) will receive one HoldCo Redeemable Share for every two JBS S.A. Common Shares it holds on the Last Trading Day. Immediately thereafter, each HoldCo Redeemable Share will be redeemed in exchange for one JBS N.V. BDR. For more information, see “The Proposed Transaction.”

 

   

“FIP Formosa” means Fundo de Investimento em Participações Multiestratégia Formosa, a Brazilian investment fund. FIP Formosa is controlled by our ultimate controlling shareholders. See “Principal Shareholders.”

 

   

“HoldCo” means JBS Participações Societárias S.A., a Brazilian holding company that will be wholly owned by JBS N.V. following the completion of the Proposed Transaction.

 

   

“HoldCo General Meeting” means the general meeting of shareholders of HoldCo scheduled for                 , 2023, during which JBS N.V., as sole shareholder of HoldCo, will approve the Redemption.

 

   

“HoldCo Redeemable Shares” means HoldCo shares that are mandatorily redeemable for JBS N.V. BDRs.

 

   

“Huon Acquisition” means JBS USA’s acquisition of Huon Aquaculture Group Ltd (“Huon”), an Australian salmon aquaculture business. The Huon Acquisition was completed on November 17, 2021. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Huon Acquisition.”

 

   

“IASB” means the International Accounting Standards Board.

 

   

“IFRS” means International Financial Reporting Standards.

 

   

“J&F” means J&F Investimentos S.A., a corporation (sociedade por ações) incorporated under the laws of Brazil. J&F is controlled by our ultimate controlling shareholders. See “Principal Shareholders.”

 

   

“JBS Australia” means Baybrick Pty Limited, an Australian proprietary limited company. JBS Australia is an indirect wholly-owned subsidiary of JBS S.A.

 

   

“JBS Canada” means JBS Food Canada ULC, a Canadian unlimited company. JBS Canada is an indirect wholly-owned subsidiary of JBS S.A.

 

   

“JBS Finance Luxembourg” means JBS Finance Luxembourg S.à r.l. (formerly JBS Packerland Distribution S.à r.l.), a private limited liability company (société à responsabilité limitée) incorporated and existing under the laws of Luxembourg with its registered address at 21, Avenue de la Gare, L-1610 Luxembourg and registered with the Luxembourg Trade and companies Register (Registre de Commerce et des sociétés) under number B203410. JBS Finance Luxembourg is an indirect wholly-owned subsidiary of JBS S.A.

 

   

“JBS N.V. BDRs” means BDRs representing one JBS N.V. Class A Common Share. We intend to apply to list the JBS N.V. BDRs on the B3.

 

   

“JBS N.V. BDR Custodian” means                 , in its capacity as U.S. custodian of the JBS N.V. BDR Depositary Bank.

 

   

“JBS N.V. BDR Deposit Agreement” means the deposit agreement dated                 , between JBS N.V. and the JBS N.V. BDR Depositary Bank.

 

   

“JBS N.V. BDR Depositary Bank” means                 , the depositary for the JBS N.V. BDRs.

 

   

“JBS N.V. Class A Common Shares” means class A common shares in the capital of JBS N.V., with a par value of €0.01 (equivalent to approximately US$0.010872 converted using the foreign exchange

 

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rate as at March 31, 2023) per class A common share, whereby each JBS N.V. Class A Common Share confers the right to one vote per share at a general meeting of shareholders.

 

   

“JBS N.V. Class B Common Shares” means class B common shares in the capital of JBS N.V., with a par value of €0.10 (equivalent to approximately US$0.10872, converted using the foreign exchange rate as at March 31, 2023) per class B common share, whereby each JBS N.V. Class B Common Share confers the right to ten votes per share at a general meeting of shareholders.

 

   

“JBS N.V. Common Shares” means, collectively, JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares.

 

   

“JBS N.V. Conversion Shares” means conversion shares in the capital of JBS N.V., with a par value of €0.09 (equivalent to approximately US$0.097848, converted using the foreign exchange rate as at March 31, 2023) per conversion share, whereby each JBS N.V. Conversion Share confers the right to nine votes per share at a general meeting of shareholders.

 

   

“JBS N.V. Free Float Percentage” means the number of JBS N.V. Class A Common Shares held by noncontrolling shareholders (being at the time of the Proposed Transaction all shareholders of JBS N.V. except LuxCo) divided by the total number of JBS N.V. Common Shares outstanding multiplied by 100%.

 

   

“JBS N.V. Shares” means, collectively, the JBS N.V. Class A Common Shares, the JBS N.V. Class B Common Shares and the JBS N.V. Conversion Shares.

 

   

“JBS S.A. ADS” means an ADS representing two JBS S.A. Common Shares. JBS S.A. ADSs are issued pursuant to the JBS S.A. ADS Program and trade in the over-the-counter market under the symbol “JBSAY.”

 

   

“JBS S.A. ADS Deposit Agreement” means the deposit agreement dated as of December 1, 2008, among, inter alia, JBS S.A. and the JBS S.A. ADS Depositary Bank.

 

   

“JBS S.A. ADS Depositary Bank” means The Bank of New York Mellon, the depositary for the JBS S.A. ADSs.

 

   

“JBS S.A. ADS Holders” means holders of JBS S.A. ADSs.

 

   

“JBS S.A. ADS Program” means the Level 1 ADS program sponsored by JBS S.A. pursuant to which JBS S.A. ADSs have been issued.

 

   

“JBS S.A. Common Shares” means shares of common stock of JBS S.A.

 

   

“JBS S.A. General Meeting” means the general meeting of shareholders of JBS S.A. scheduled for             , 2023, during which JBS S.A. Shareholders will have the opportunity to vote on the Merger of Shares and the Cash Dividend.

 

   

“JBS S.A. Free Float Outstanding” means all JBS S.A. Common Shares except for treasury shares and shares owned by the controlling shareholders and their related parties or by directors or officers of JBS S.A.

 

   

“JBS S.A. Shareholders” means holders of JBS S.A. Common Shares.

 

   

“JBS USA” means JBS USA Lux S.A., a public limited liability company (société anonyme) incorporated and existing under the laws of Luxembourg, with its registered address at 21, Avenue de la Gare, L-1610 Luxembourg, Grand Duchy of Luxembourg and registered with the Luxembourg Trade and companies Register (Registre de Commerce et des sociétés) under number B203443. JBS USA is a wholly-owned subsidiary of JBS S.A.

 

   

“JBS USA Holding” means JBS USA Holding Lux S.à r.l. (formerly JBS USA Holdings, Inc.), a private limited liability company (société à responsabilité limitée) incorporated and existing under the laws of Luxembourg with its registered address at 21, Avenue de la Gare, L-1610 Luxembourg and registered with the Luxembourg Trade and companies Register (Registre de Commerce et des sociétés) under number B203413. JBS USA Holding is an indirect wholly-owned subsidiary of JBS S.A.

 

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“King Acquisition” means JBS S.A.’s acquisition of King’s Group (“King”), a global producer of bresaola, with a presence in Italy and the United States. The King Acquisition was completed on February 4, 2022. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—King Acquisition.”

 

   

“Last Conversion Quarter” means last quarter prior to the close of the Class A Conversion Period (i.e., the fourth quarter of 2026).

 

   

“Last Trading Day” means the last day the JBS S.A. Common Shares will trade on the B3, immediately prior to the Merger of Shares.

 

   

“LuxCo” means J&F Investments Luxembourg S.à r.l., a private limited liability company (société à responsabilité limitée) incorporated and existing under the laws of Luxembourg. Our controlling shareholders will indirectly hold their shares of JBS N.V. through LuxCo following the completion of the Restructuring. LuxCo will be a direct shareholder of JBS N.V. following the completion of the Restructuring. See “Principal Shareholders—JBS N.V.

 

   

“Luxembourg” means the Grand Duchy of Luxembourg.

 

   

“Margarine and Mayonnaise Business Acquisition” means Seara’s acquisition of Bunge Alimentos’ margarine and mayonnaise businesses in Brazil. The acquisition was completed on November 30, 2020. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Margarine and Mayonnaise Business Acquisition.”

 

   

“Maximum Conversion Rate” means 55% of an Eligible Shareholder’s Maximum Convertible Shares. It refers to the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder which may be converted into JBS N.V. Class B Common Shares during the Class A Conversion Period, except during the Last Conversion Quarter. For more information, see “The Proposed TransactionClass A Conversion Period.”

 

   

“Maximum Convertible Shares” means the maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares during the Class A Conversion Period. The Maximum Convertible Shares equals the number of JBS N.V. BDRs to which the Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction). For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“Merger of Shares” means the incorporação de ações corporate transaction through which every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo will be automatically contributed for their book value into HoldCo in exchange for one newly issued HoldCo Redeemable Share, determined pursuant to the Exchange Ratio, resulting in JBS S.A. becoming a wholly owned subsidiary of HoldCo. For more information, see “The Proposed Transaction.”

 

   

“Merger of Shares Protocol” means the Brazilian-law document (Protocolo e Justificação de Incorporação de Ações), prepared by the management of JBS S.A. and HoldCo, to be submitted for approval by their respective shareholders at their respective special meetings of shareholders and that provides the shareholders with information on the terms, conditions and reasoning for the approval of the merger of shares contemplated by the Proposed Transaction. For more information, see “Related Party Transactions—Transaction Documents—Merger of Shares Protocol.”

 

   

“Minimum Free Float” means 20%. With respect to the Last Conversion Quarter, if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float, the number of JBS N.V. Class A Common Shares to which each such conversion

 

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request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

   

“Mexico” means the United Mexican States.

 

   

“Moy Park” means Moy Park Holdings (Europe) Ltd., a private company incorporated under the laws of Northern Ireland. Moy Park owns the companies that comprise the “Moy Park” business based in the United Kingdom, France and the Netherlands. Moy Park is a wholly-owned subsidiary of PPC.

 

   

“the Netherlands” means the European part of the Kingdom of the Netherlands.

 

   

“Pilgrim’s Food Masters Acquisition” means PPC’s acquisition of the specialty meats and ready meals businesses of Kerry Group plc, which have subsequently changed their name to Pilgrim’s Food Masters (“PFM”). The specialty meats and ready meals businesses are manufacturers of branded and private label meats, meat snacks and food-to-go products in the United Kingdom and Ireland and an ethnic chilled and frozen ready meals business in the United Kingdom. The Pilgrim’s Food Masters Acquisition was completed on September 24, 2021. For more information about the Pilgrim’s Food Masters Acquisition, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Pilgrim’s Food Masters Acquisition.”

 

   

“PPC” means Pilgrim’s Pride Corporation, a Delaware corporation. JBS S.A. beneficially owns approximately 80% of PPC’s outstanding common stock.

 

   

“Proposed Transaction” means: (1) the Merger of Shares; (2) the Redemption; and (3) the Cash Dividend, as detailed and subject to the conditions described in this prospectus. For more information, see “The Proposed Transaction.”

 

   

“Redemption” means the redemption by HoldCo of all of the HoldCo Redeemable Shares and delivery to each holder thereof of one JBS N.V. BDR for every one HoldCo Redeemable Share held. The Redemption will take place immediately after the Merger of Shares. For more information, see “The Proposed Transaction.”

 

   

“Restructuring” means the corporate restructuring process that the JBS Group intends to conduct which, as described in this prospectus, ultimately aims to migrate the JBS S.A. Shareholders to become shareholders of JBS N.V. The Proposed Transaction is the second and final step in the Restructuring. For more information about the Restructuring, see “Information about JBS N.V.

 

   

“Rivalea Acquisition” means JBS Australia’s acquisition of Rivalea Holdings Pty Ltd and Oxdale Dairy Enterprise Pty Ltd. (“Rivalea”), a hog breeding and processing business in Australia. The Rivalea Acquisition was completed on January 4, 2022. For more information about the Rivalea Acquisition, see “Information about JBS S.A.—History and Development—Recent Acquisitions— Rivalea Acquisition.”

 

   

“Seara” means Seara Alimentos Ltda., a Brazilian limited liability company (sociedade limitada). Seara and its subsidiaries produce poultry, pork and processed foods in Brazil. Seara is an indirect wholly-owned subsidiary of JBS S.A.

 

   

“SEC” means the United States Securities and Exchange Commission.

 

   

“Securities Act” means the United States Securities Act of 1933, as amended.

 

   

“Sunnyvalley Acquisition” means JBS USA’s acquisition of Sunnyvalley Smoked Meats, Inc. (“Sunnyvalley”), a producer of a variety of smoked bacon, ham and turkey products for sale to retail and wholesale consumers under the Sunnyvalley brand. The Sunnyvalley Acquisition was completed on December 1, 2021. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Sunnyvalley Acquisition.”

 

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“TriOak Business Acquisition” means JBS USA’s acquisition of the TriOak Foods (“TriOak”) business. TriOak is an American pork producer and grain marketer. The TriOak Business Acquisition was completed on December 2, 2022. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—TriOak Business Acquisition.”

 

   

“U.K.” or “United Kingdom” means the United Kingdom of Great Britain and Northern Ireland.

 

   

“ultimate controlling shareholders” means Messrs. Joesley Mendonça Batista and Wesley Mendonça Batista.

 

   

“U.S.” or “United States” means the United States of America.

 

   

“U.S. dollars,” “US$” or “$” means U.S. dollars, the official currency of the United States.

 

   

“USDA” means the United States Department of Agriculture.

 

   

“Vivera Business Acquisition” means JBS USA’s acquisition of the business of Vivera Topholding BV (“Vivera”), a manufacturer of plant-based food products in Europe. Vivera offers products under the Vivera brand, as well as private labels, in more than 25 countries. The Vivera Business Acquisition was completed on June 17, 2021. For more information, see “Information about JBS S.A.—History and Development—Recent Acquisitions—Vivera Business Acquisition.”

 

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes statements reflecting assumptions, expectations, intentions or beliefs about future events that are intended as “forward-looking statements.” All statements included in this prospectus, other than statements of historical fact, that address activities, events or developments that we or our management expect, believe or anticipate will or may occur in the future are forward-looking statements. These statements represent our reasonable judgment on the future based on various factors and using numerous assumptions and are subject to known and unknown risks, uncertainties and other factors that could cause our actual results and financial position to differ materially from those contemplated by the statements. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “project,” “forecast,” “plan,” “may,” “will,” “should,” “could,” “expect” and other words of similar meaning. In particular, these include, but are not limited to, statements of our current views and estimates of future economic circumstances, industry conditions in domestic and international markets and our performance and financial results.

Among the factors that may cause actual results and events to differ from the anticipated results and expectations expressed in such forward-looking statements are the following:

 

   

the Proposed Transaction and the expected timing and satisfaction of conditions precedent for completion of the Proposed Transaction;

 

   

the outbreak of COVID-19 and its impact on business and economic conditions;

 

   

the risk of outbreak of animal diseases, more stringent trade barriers in key export markets and increased regulation of food safety and security;

 

   

product contamination or recall concerns;

 

   

fluctuations in the prices of live cattle, hogs, chicken, corn and soymeal;

 

   

fluctuations in the selling prices of beef, pork and chicken products;

 

   

developments in, or changes to, the laws, regulations and governmental policies governing our business and products or failure to comply with them, including environmental and sanitary liabilities;

 

   

currency exchange rate fluctuations, trade barriers, exchange controls, political risk and other risks associated with export and foreign operations;

 

   

changes in international trade regulations;

 

   

our strategic direction and future operation;

 

   

deterioration of economic conditions globally and more specifically in the principal markets in which we operate;

 

   

our ability to implement our business plan, including our ability to arrange financing when required and on reasonable terms and the implementation of our financing strategy and capital expenditure plan;

 

   

the successful integration or implementation of mergers and acquisitions, joint ventures, strategic alliances or divestiture plans;

 

   

the competitive nature of the industry in which we operate and the consolidation of our customers;

 

   

customer demands and preferences;

 

   

our level of indebtedness;

 

   

adverse weather conditions in our areas of operations;

 

   

continued access to a stable workforce and favorable labor relations with employees;

 

   

our dependence on key members of our management;

 

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the interests of our ultimate controlling shareholders;

 

   

reputational risk in connection with U.S. and Brazilian civil and criminal actions and investigations involving our ultimate controlling shareholders, and the outcome of these actions;

 

   

economic instability in Brazil and a resulting reduction in market confidence in the Brazilian economy;

 

   

political crises in Brazil;

 

   

the declaration or payment of dividends or interest attributable to shareholders’ equity;

 

   

unfavorable outcomes in legal and regulatory proceedings and government investigations that we are, or may become, a party to;

 

   

the risk factors discussed under the heading “Risk Factors”;

 

   

other factors or trends affecting our financial condition, liquidity or results of operations; and

 

   

other statements contained in this prospectus regarding matters that are not historical facts.

In addition, there may be other factors and uncertainties, many of which are beyond our control, that could cause our actual results and events to be materially different from the results referenced in the forward-looking statements. Many of these factors will be important in determining our actual future results. Consequently, any or all of our forward-looking statements may turn out to be inaccurate.

We caution investors not to place undue reliance on any forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

All forward-looking statements contained in this prospectus are qualified in their entirety by this cautionary statement.

 

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PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Financial Statements

JBS N.V.

Until the completion of the first step of the Restructuring, which is expected to occur prior to the Closing Date and pursuant to which the controlling shareholders of JBS S.A. will transfer their interest in JBS S.A. to JBS N.V., JBS N.V. will have no revenues or business operations or material assets, liabilities or contingencies.

The JBS Group intends to conduct a corporate restructuring process which, as described in this prospectus, ultimately aims to migrate the JBS S.A. Shareholders to become shareholders of JBS N.V. Following the completion of the Proposed Transaction, JBS S.A. will be an indirect wholly-owned subsidiary of JBS N.V. Therefore, the business of JBS N.V. and its consolidated subsidiaries following the completion of the Proposed Transaction will be the same as the business of JBS S.A. and its consolidated subsidiaries immediately prior to the Proposed Transaction.

Following the completion of the Proposed Transaction, JBS N.V. will begin reporting consolidated financial information to shareholders prepared in accordance with IFRS, as issued by the IASB.

JBS S.A.

General

JBS S.A., which is JBS N.V.’s predecessor for accounting purposes, maintains its books and records in Brazilian reais, which is its functional currency. JBS S.A.’s consolidated financial statements included in this prospectus include the financial statements of all of its subsidiaries which are prepared using each subsidiary’s respective functional currency. At the entity level, transactions in foreign currencies other than the functional currency of the entity are initially measured using the exchange rates prevailing at the dates of each transaction. Foreign currency monetary items in the statement of financial position are translated using the closing exchange rate as of the reporting date. Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement at period end of foreign currency monetary assets and liabilities are recognized in the consolidated statement of income, under the captions “Finance income” or “Finance expense.”

JBS S.A.’s consolidated financial statements included in this prospectus are presented in U.S. dollars. JBS S.A. elected to change its presentation currency from the Brazilian real to the U.S. dollar effective January 1, 2022 (which has been retrospectively applied to all periods presented) to facilitate a more direct comparison to its competitors. The translation to the U.S. dollar was performed in two steps: (1) first the financial statements of the subsidiaries with functional currencies different to Brazilian reais were translated into Brazilian reais to produce consolidated financial statements of JBS S.A. in Brazilian reais; and (2) subsequently, the consolidated financial statements of JBS S.A. in Brazilian reais were translated into U.S. dollars. These translations were effected as follows:

 

   

all assets and liabilities are translated into the presentation currency using the closing exchange rate at the reporting date;

 

   

income and expenses, as well as cash flows, are translated into the presentation currency using the average rates prevailing during the reporting period; and

 

   

all resulting exchange differences are recognized as other comprehensive income and accumulated in the foreign currency translation adjustment reserve in the consolidated statement of changes in equity.

This prospectus includes financial information derived from:

(1) JBS S.A.’s unaudited condensed consolidated interim financial information as of March 31, 2023 and for the three-month periods ended March 31, 2023 and 2022, and the related notes thereto, which are included elsewhere in this prospectus. We refer to these as “JBS S.A.’s unaudited interim financial statements;” and

 

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(2) JBS S.A.’s audited consolidated financial statements as of December 31, 2022 and 2021 and January 1, 2021 and for each of the years in the three-year period ended December 31, 2022, and the related notes thereto, which are included elsewhere in this prospectus. We refer to these as “JBS S.A.’s audited financial statements” and, together with JBS S.A.’s unaudited interim financial statements, “JBS S.A.’s financial statements.”

JBS S.A.’s audited financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS), as issued by International Accounting Standards Board (IASB). JBS S.A.’s unaudited interim financial statements have been prepared in accordance with IAS 34 - Interim Financial Reporting, issued by the IASB.

The Restructuring and the Proposed Transaction

The JBS Group intends to conduct a corporate restructuring process which, as described in this prospectus, ultimately aims to migrate the JBS S.A. Shareholders to become shareholders of JBS N.V.

As the first step in the Restructuring, prior to the Closing Date, JBS N.V. will, through a series of transactions, become the indirect controlling shareholder of JBS S.A. On July 7, 2023, our controlling shareholders entered into a binding and unconditional agreement with JBS N.V., HoldCo and LuxCo pursuant to which: (1) JBS S.A.’s controlling shareholders will contribute and transfer all of their JBS S.A. Common Shares at book value to LuxCo; (2) immediately thereafter, LuxCo will contribute and transfer all such JBS S.A. Common Shares at book value to JBS N.V. in exchange for 243,704,227 JBS N.V. Class A Common Shares and 297,860,722 JBS N.V. Class B Common Shares (whereby the difference in the value of the JBS S.A. Common Shares and the aggregate nominal value of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will be added to the general share premium reserve maintained by JBS N.V.); and (3) immediately thereafter, JBS N.V. will contribute and transfer such JBS S.A. Common Shares at book value to HoldCo in exchange for common shares of HoldCo. These transactions and transfers of equity interests must be consummated and completed no later than December 31, 2023. As a result of this step, JBS N.V. will, through HoldCo, indirectly hold the shares of JBS S.A. that are currently held directly by JBS S.A.’s controlling shareholders. Accordingly, JBS N.V. will become the indirect controlling shareholder of JBS S.A. This step will be subject to the same exchange ratio of one JBS N.V. Common Share for every two JBS S.A. Common Shares that will be applied to JBS S.A.’s non-controlling shareholders pursuant to the Merger of Shares and Redemption, which will result in each JBS S.A. shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V., the voting power of our controlling shareholders (held indirectly, through LuxCo) may increase substantially in relation to our non-controlling shareholders as a result of the aforementioned steps, depending on the number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares during the Class A Conversion Period.

The second and final step in the Restructuring, as further described in this prospectus, is to effect a Merger of Shares under which every two JBS S.A. Common Shares that are not held by HoldCo will be automatically contributed into HoldCo in exchange for one newly issued mandatorily redeemable preferred share of HoldCo. Each JBS S.A. Shareholder will receive HoldCo shares that are mandatorily redeemable for JBS N.V. BDRs, i.e., the HoldCo Redeemable Shares. Immediately following the Merger of Shares, HoldCo will redeem all of the HoldCo Redeemable Shares and deliver to each holder thereof JBS N.V. BDRs. Following this step, all of the shareholders of JBS S.A. immediately prior to the Merger of Shares will become shareholders of JBS N.V. through the JBS N.V. BDRs and HoldCo will hold 100% of the JBS S.A. Common Shares.

 

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As the ultimate controlling shareholders of all entities involved in the transaction are the same immediately prior to and immediately following the Restructuring, the Restructuring will be accounted for as a reorganization under common control. The consolidated operations, assets, liabilities and contingencies of JBS N.V. immediately following the Restructuring will be the same as those of JBS S.A. immediately prior to it and therefore the reorganization will be accounted for on a book value basis – the carrying amounts of JBS S.A.’s consolidated assets and liabilities will be reflected in JBS N.V.’s consolidated financial statements with no fair value adjustments. As a result, the consolidated financial statements of JBS N.V. following the Restructuring will reflect:

 

   

The historical consolidated operating results, cash flows and financial position of JBS S.A. (as predecessor) for all dates and periods prior to the effective closing date of the Restructuring.

 

   

The contribution of JBS S.A.’s consolidated assets and liabilities at book value on the effective closing date of the Restructuring;

 

   

The consolidated operating results and cash flows of JBS N.V. (as successor) and its consolidated subsidiaries, including JBS S.A., following the effective closing date of the Restructuring as a continuation of those of JBS S.A., and the financial position of JBS N.V. as of the year-end subsequent to the effective closing date of the Restructuring. The comparative periods will be restated as if the reorganization had taken place at the beginning of the earliest comparative period presented.

 

   

An adjustment, against retained earnings, in the consolidated statement of changes in equity as of the effective closing date of the Restructuring to reflect the statutory equity reserves of JBS N.V.

 

   

The number of common shares issued by JBS N.V. will be reflected retrospectively to all periods, for the purposes of calculating earnings per share.

Non-GAAP Financial Measures

We have disclosed certain non-GAAP financial measures in this prospectus, including: Adjusted EBITDA and Adjusted EBITDA Margin. These non-GAAP financial measures are used as measures of performance by our management and should not be considered as measures of financial performance in accordance with IFRS. You should rely on non-GAAP financial measures in a supplemental manner only in making your investment decision. There is no standard definition of non-GAAP financial measures, and JBS S.A.’s definitions may not be comparable to those used by other companies.

Adjusted EBITDA and Adjusted EBITDA Margin

Adjusted EBITDA is calculated by making the following adjustments, as further described in this prospectus (see “Summary—Summary Historical Financial Data”), to net income: exclusion of net finance expenses; exclusion of current and deferred income taxes; exclusion of depreciation and amortization expenses; exclusion of share of profit of equity-accounted investees, net of tax; exclusion of expenses with the DOJ and antitrust agreements; exclusion of donations and social programs expenses; exclusion of out of period tax credits impacts; exclusion of JBS fund for the Amazon; exclusion of J&F Leniency expenses refund; and exclusion of certain other income (expenses), net.

Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by net revenue.

The use of Adjusted EBITDA, instead of net income, and Adjusted EBITDA Margin, instead of net margin, have limitations as analytical tools, including the following:

 

   

Adjusted EBITDA and Adjusted EBITDA Margin do not reflect changes in, or cash requirements for, working capital needs;

 

   

Adjusted EBITDA and Adjusted EBITDA Margin do not reflect interest expense, or the cash requirements necessary to service interest or principal payments, on debt;

 

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Adjusted EBITDA and Adjusted EBITDA Margin do not reflect income tax expense or the cash requirements to pay taxes;

 

   

Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA and Adjusted EBITDA Margin do not reflect any cash requirements for such replacements;

 

   

Adjusted EBITDA and Adjusted EBITDA Margin do not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments; and

 

   

Adjusted EBITDA and Adjusted EBITDA Margin include adjustments that represent cash expenses or that represent non-cash charges that may relate to future cash expenses, and some of these expenses are of a type that are expected to be incurred in the future, although the amount of any such future charge cannot be predicted.

For more information about Adjusted EBITDA and Adjusted EBITDA Margin and the adjusting items JBS S.A. used to calculate Adjusted EBITDA and Adjusted EBITDA Margin, see “Summary—Summary Historical Financial Data.”

Industry and Market Data

Certain market and industry data included in this prospectus have been obtained from third-party sources that we believe to be reliable, such as the USDA. We have not independently verified such third-party information and cannot assure you of its accuracy or completeness. While we are not aware of any misstatements regarding any market, industry or similar data presented herein, such data involves risks and uncertainties and is subject to change based on various factors, including those discussed under “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors.”

Nothing in this prospectus should be interpreted as a market forecast.

Brands

This prospectus includes trademarks, trade names and trade dress of other companies. Use or display by us of other parties’ trademarks, trade names or trade dress or products is not intended to and does not imply a relationship with, or endorsement or sponsorship of us by, the trademark, trade name or trade dress owners. Solely for the convenience of investors, in some cases we refer to our brands in this prospectus without the ® symbol, but these references are not intended to indicate in any way that we will not assert our rights to these brands to the fullest extent permitted by law.

Rounding

Certain figures and some percentages included in this prospectus have been subject to rounding adjustments. Accordingly, the totals included in certain tables contained in this prospectus may not correspond to the arithmetic aggregation of the figures or percentages that precede them.

 

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QUESTIONS AND ANSWERS ABOUT THE PROPOSED TRANSACTION, THE JBS S.A. GENERAL MEETING AND JBS N.V.

The following questions and answers are intended to briefly address some commonly asked questions regarding the Proposed Transaction, the JBS S.A. General Meeting, JBS N.V. and other matters. These questions and answers only highlight some of the information contained in this prospectus and may not contain all of the information that is important to you, current JBS S.A. Shareholder. Please further refer to “The Proposed Transaction” and the more detailed information contained elsewhere in this prospectus and the exhibits to this prospectus, which you should read carefully and in their entirety.

Questions and Answers for Current JBS S.A. Shareholders about the Proposed Transaction

What is the Proposed Transaction on which I am being asked to vote?

The Proposed Transaction is part of a corporate restructuring of the JBS Group with the purpose of listing shares on the NYSE and BDRs on the B3 that represent equity of JBS N.V. Currently, JBS S.A. Common Shares are listed on the B3 and JBS S.A. ADSs trade over-the-counter in the U.S. Upon completion of the Proposed Transaction, we expect to list JBS N.V. Class A Common Shares on the NYSE, to list JBS N.V. BDRs on the B3 and to delist JBS S.A. Common Shares from the Novo Mercado listing segment of the B3. In addition, the JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting. See “The Proposed Transaction—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

The completion of the Proposed Transaction is expected to occur on or about                  business days after the JBS S.A. General Meeting and the HoldCo General Meeting, subject to the satisfaction of certain conditions described in this prospectus. The Proposed Transaction will consist of the three steps below:

 

   

Merger of Shares. Subject to approval at the JBS S.A. General Meeting, on the Closing Date, the Merger of Shares will be implemented through an incorporação de ações under the Brazilian Corporation Law. Pursuant to the Merger of Shares, every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo will be automatically contributed for their book value into HoldCo in exchange for one HoldCo Redeemable Share, determined pursuant to the Exchange Ratio, and JBS S.A. will become a wholly-owned subsidiary of HoldCo. The HoldCo Redeemable Shares are mandatorily redeemable for JBS N.V. BDRs.

 

   

Redemption. Immediately after the Merger of Shares is approved at the JBS S.A. General Meeting, JBS N.V., as sole shareholder of HoldCo, will approve at the HoldCo General Meeting the redemption of all of the HoldCo Redeemable Shares and deliver to each holder thereof one JBS N.V. BDR for every one HoldCo Redeemable Share held. If such holder wants to receive the underlying JBS N.V. Class A Common Shares, the JBS N.V. BDRs may be cancelled at any time, and from time to time, on or after about two business days after the Closing Date.

 

   

Cash Dividend. Subject to approval at the JBS S.A. General Meeting, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a Cash Dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

Immediately following the completion of the Proposed Transaction:

 

   

JBS S.A. will be an indirect wholly owned subsidiary of JBS N.V.

 

   

The business conducted by the JBS Group will be the same as prior to the Proposed Transaction.

 

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You will become a shareholder of JBS N.V. (initially through the holding of JBS N.V. BDRs, which can be cancelled to allow direct interest in JBS N.V. through holding JBS N.V. Class A Common Shares).

 

   

The shareholders of JBS N.V. will be the same as the shareholders of JBS S.A. on the Last Trading Day, and on the Closing Date, our controlling shareholders will (indirectly, through LuxCo) hold an aggregate number of JBS N.V. Class B Common Shares and JBS N.V. Class A Common Shares that represents the same economic interest in JBS N.V. as our controlling shareholders have in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to shareholders of JBS S.A. resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V. (each JBS N.V. Class A Common Share is entitled to one vote at a general meeting of shareholders of JBS N.V. and each JBS N.V. Class B Common Share is entitled to 10 votes at a general meeting of shareholders of JBS N.V.), the voting power of the ultimate controlling shareholders will increase from 48.83% to 85.03% (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023).

 

   

Our ultimate controlling shareholders will continue to control the JBS Group’s business through the indirect ownership of JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares representing in the aggregate 85.03% of the voting power in JBS N.V. (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023), which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V.

What is the purpose of the Proposed Transaction?

The purpose of the Proposed Transaction is to create a corporate structure that allows us to better reflect our global presence and diverse international operations and implement our growth strategy, which we expect will allow us to improve our rating indices and maximize shareholder value. As an NYSE-listed company, we expect to improve our access to funding sources and enhance our ability to raise financing to support our operations and fund growth, as well as lower our cost of capital.

If the Proposed Transaction is concluded, what will I receive?

Subject to the approval of the Merger of Shares at the JBS S.A. General Meeting and the satisfaction of the conditions described in this prospectus, each holder of JBS S.A. Common Shares, except HoldCo, will receive one JBS N.V. BDR for every two JBS S.A. Common Shares it holds.

No tradable fractional JBS N.V. BDRs may be delivered to JBS S.A. Shareholders pursuant to the Proposed Transaction. Following the Closing Date, any fractional JBS N.V. BDRs attributed to JBS S.A. Shareholders resulting

 

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from the Merger of Shares and the Redemption will be grouped into whole numbers and sold on the open market managed by B3, as applicable. The net proceeds from the sale of the fractional JBS N.V. BDRs will be distributed on a pro rata basis to the former JBS S.A. Shareholders who contributed their JBS S.A. Common Shares to HoldCo in the Merger of Shares. Excluding the Cash Dividend, no additional consideration in cash or in kind will be paid to JBS S.A. Shareholders in connection with the Proposed Transaction.

The Exchange Ratio is defined in the section “Certain Defined Terms.” The Exchange Ratio has been established so that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) receives, upon completion of the Proposed Transaction, one JBS N.V. BDR for every two JBS S.A. Common Shares that it holds. Prior to the completion of the Proposed Transaction, our controlling shareholders (through LuxCo) will have received one JBS N.V. Class A Common Share or one JBS N.V. Class B Common Share for every two JBS S.A. Common Shares held. This will result in each JBS S.A. Shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. Shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.”

In addition, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a Cash Dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

In connection with the Proposed Transaction, HoldCo may be required to withhold and collect Brazilian taxes imposed on capital gains assessed, if any, due by certain non-Brazilian JBS S.A. Shareholders that hold their investment under the special tax regime of CMN Resolution No. 4,373/2014. See “Material Tax Considerations—Material Brazilian Tax Considerations.”

Will JBS S.A. Shareholders receive the same consideration?

In connection with the Proposed Transaction, each holder of JBS S.A. Common Shares issued and outstanding on the Last Trading Day (not including HoldCo) will receive JBS N.V. Class A Common Shares in the form of JBS N.V. BDRs, based on the Exchange Ratio.

On the other hand, on the Closing Date, our controlling shareholders will (indirectly, through LuxCo) hold an aggregate number of JBS N.V. Class B Common Shares and JBS N.V. Class A Common Shares that represents the same economic interest in JBS N.V. as our controlling shareholders have in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” Since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V. (each JBS N.V. Class A Common Share is entitled to one vote at a general meeting of shareholders of JBS N.V. and each JBS N.V. Class B Common Share is entitled to 10 votes at a general meeting of shareholders of JBS N.V.), the voting power of the ultimate controlling shareholders will increase from 48.83% to 85.03% immediately upon completion of the Proposed Transaction (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023). Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that

 

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our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. The exact percentage of the then-outstanding JBS N.V. Shares and aggregate voting power in JBS N.V. that will be held (indirectly) by our controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the percentage of JBS S.A. shares that they hold on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

What happens if the Proposed Transaction is not approved at the JBS S.A. General Meeting?

If the Proposed Transaction is not approved at the JBS S.A. General Meeting, the Proposed Transaction will not become effective. In this case:

 

   

You will continue to hold your JBS S.A. Common Shares.

 

   

JBS S.A. Common Shares will remain listed on B3.

 

   

JBS N.V. will not have its Class A Common Shares listed on the NYSE, and you will not receive JBS N.V. Class A Common Shares or JBS N.V. BDRs.

 

   

You will not receive the Cash Dividend.

When do you expect the Proposed Transaction to be concluded?

We expect the Proposed Transaction to close on or about                  business days after the JBS S.A. General Meeting, subject to the approval of JBS S.A. Shareholders at the JBS S.A. General Meeting and satisfaction of certain conditions. None of these conditions may be waived, and we cannot guarantee that the Proposed Transaction will be concluded within this timeframe. See “The Proposed Transaction—Conditions Precedent to the Proposed Transaction.

Will the JBS N.V. Class A Common Shares and the JBS N.V. BDRs be traded on any stock exchange?

We expect that on or about                 , 2023, the JBS N.V. BDRs will be listed on B3 under the symbol “                ,” and on or about                 , 2023, the JBS N.V. Class A Common Shares will be listed on the NYSE under the symbol “JBS”.

The opening price of the JBS N.V. BDRs on the B3 will be equivalent to the closing price of the JBS S.A. Common Shares on the Last Trading Day, as adjusted by the Exchange Ratio. We expect that the opening price of the JBS N.V. Class A Common Shares on the NYSE will be determined by buy and sell orders collected by the NYSE from broker-dealers. Based on such orders, the designated market maker will determine an opening price for the JBS N.V. Class A Common Shares. However, prior to the opening trade, there will not be a price at which underwriters initially sell the JBS N.V. Class A Common Shares to the public as there would be in a traditional underwritten initial public offering. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, upon listing on the NYSE, the public trading price of the JBS N.V. Class A Common Shares may be more volatile than in a traditional underwritten initial public offering and could decline significantly and rapidly. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.

 

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May I elect to receive JBS N.V. Class A Common Shares instead of JBS N.V. BDRs?

No. Holders of JBS S.A. Common Shares on the Last Trading Day shall receive JBS N.V. BDRs in connection with the Proposed Transaction. However, at any time, and from time to time, on or after about two business days after the Closing Date, a holder of JBS N.V. BDRs that wants to receive JBS N.V. Class A Common Shares may request the cancellation of all or a portion of its JBS N.V. BDRs by: (1) instructing its broker or custodian operating in Brazil to cancel its JBS N.V. BDRs with the JBS N.V. BDR Depositary Bank; and (2) delivering evidence that all fees and potential taxes due in connection with this service were duly paid, as set forth in the JBS N.V. BDR Deposit Agreement. The cancellation instruction to the broker or custodian must include an appropriate brokerage account outside of Brazil to receive the underlying JBS N.V. Class A Common Shares. See “The Proposed Transaction—Receiving JBS N.V. Class A Common Shares.”

May I elect to receive cash instead of JBS N.V. BDRs?

No. JBS S.A. Shareholders will not be given the option to receive cash in lieu of JBS N.V. BDRs in the Proposed Transaction. If you do not want to receive JBS N.V. BDRs in connection with the Proposed Transaction, you must sell you JBS S.A. Common Shares prior to the Last Trading Day. Alternatively, you have the option to: (1) sell the JBS N.V. BDRs on the B3; or (2) cancel the JBS N.V. BDRs and receive the underlying JBS N.V. Class A Common Shares in your custodian account in the United States and sell them on the NYSE.

May I continue to be a JBS S.A. Shareholder?

If the Proposed Transaction is concluded, you will not be able to continue to be a direct shareholder of JBS S.A., but you will be able to continue to be an indirect shareholder of JBS S.A. through the ownership of JBS N.V. BDRs. Upon completion of the Proposed Transaction, JBS S.A. will no longer have its shares listed on B3 or any other exchange and JBS S.A. will become a wholly owned subsidiary of HoldCo.

May I participate in the Proposed Transaction as a JBS S.A. ADS Holder?

No. The JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting. This means that if you hold JBS S.A. ADSs, you will not be entitled to participate in the JBS S.A. General Meeting unless you surrender your JBS S.A. ADSs in accordance with the provisions of the JBS S.A. ADS Deposit Agreement and receive the underlying JBS S.A. Common Shares prior to the date of the JBS S.A. General Meeting. See “The Proposed Transaction—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

What conditions must be satisfied to complete the Proposed Transaction?

In addition to the necessary corporate approvals, including approval of the Proposed Transaction at the JBS S.A. General Meeting, the material conditions that must be satisfied to complete the Proposed Transaction are set forth below, in chronological order:

Before the JBS S.A. General Meeting is called:

 

   

The registration statement filed with the SEC on Form F-4 to effect the registration under the Securities Act of the JBS N.V. Class A Common Shares (i.e., the underlying assets of the JBS N.V. BDRs) to be issued and delivered to JBS S.A. Shareholders and the JBS N.V. Class B Common Shares (of which this prospectus is a part) shall have become effective prior to the date the JBS S.A. General Meeting is called, no stop order suspending the effectiveness of the Form F-4 shall have been issued, and no proceedings for that purpose shall have been initiated or be threatened, by the SEC.

Before the completion of the Proposed Transaction:

 

   

JBS N.V. Class A Common Shares shall be approved for listing on the NYSE.

 

   

JBS N.V. BDRs shall be approved by the CVM and for listing on B3.

 

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The Australian Foreign Investment Review Board shall have approved the transfer of the JBS S.A. common shares from our controlling shareholders within the context of the Proposed Transaction. This approval was obtained on March 29, 2023.

None of these conditions may be waived.

Do I have withdrawal rights (direito de recesso) in connection with the Proposed Transaction?

No. JBS S.A. Shareholders will not have withdrawal rights (direito de recesso) under the Brazilian Corporation Law.

What will be the accounting treatment of the Proposed Transaction?

As the ultimate controlling shareholders of all entities involved in the transaction are the same immediately prior to and immediately following the Restructuring, the Restructuring will be accounted for as a reorganization under common control. The consolidated operations, assets, liabilities and contingencies of JBS N.V. immediately following the Restructuring will be the same as those of JBS S.A. immediately prior to it and therefore the reorganization will be accounted for on a book value basis – the carrying amounts of JBS S.A.’s consolidated assets and liabilities will be reflected in JBS N.V.’s consolidated financial statements with no fair value adjustments. For more information, see “Presentation of Financial and Other Information—The Restructuring and the Proposed Transaction.

Questions and Answers about the JBS S.A. General Meeting

What corporate approvals are needed for the Proposed Transaction?

The Merger of Shares and the Cash Dividend is subject to the approval of JBS S.A. Shareholders at the JBS S.A. General Meeting. On                 , 2023, the board of directors of JBS S.A. approved convening the JBS S.A. General Meeting that will decide on the Proposed Transaction and recommended its approval.

The Redemption is subject to approval by JBS N.V., as sole shareholder of HoldCo.

Where and when will the JBS S.A. General Meeting be held?

TIME AND DATE:                 , 2023, at                  a.m./p.m. (São Paulo time).

PLACE:                 .

AGENDA: Consider and vote on: (1) the Merger of Shares, including ancillary matters, such as the approval of the Merger of Shares Protocol and related valuation reports; (2) the Delisting; and (3) the Cash Dividend.

For additional information about the JBS S.A. General Meeting, see “JBS S.A. General Meeting.”

What is the quorum for installation of the JBS S.A. General Meeting?

The JBS S.A. General Meeting will be installed on first call if attended by shareholders representing collectively 1/4 of the outstanding capital stock of JBS S.A. If the attendance requirement is not met for the JBS S.A. General Meeting on first call, the JBS S.A. General Meeting will be reconvened at a date and time at least eight calendar days after the date and time scheduled for the JBS S.A. General Meeting on first call. The JBS S.A. General Meeting may be installed on second call with any percentage of holders present at the meeting following the second call. Although the controlling shareholders will be counted for quorum purposes to install the JBS S.A. General Meeting and the shares held by our controlling shareholders will be sufficient to establish a quorum, the JBS S.A. General Meeting will

 

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not be held if no non-controlling shareholders participate because the Proposed Transaction cannot be approved without participation by non-controlling shareholders. As described below under “What is the minimum vote required to approve the Proposed Transaction, and will our controlling shareholders vote at the JBS S.A. General Meeting?” all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting.

What is the minimum vote required to approve the Proposed Transaction, and will our controlling shareholders vote at the JBS S.A. General Meeting?

The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as described under the caption “JBS S.A. General Meeting—Agenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares.

The Delisting requires the affirmative vote of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. Accordingly, our controlling shareholders will not be entitled to vote on this matter.

The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting.

Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. A majority of the JBS S.A. Free Float Outstanding represents approximately 25% of the total issued and outstanding JBS S.A. Common Shares as of June 30, 2023. However, since certain matters being voted on at the JBS S.A. General Meeting (such as the Merger of Shares) must be approved by a majority of the total outstanding JBS S.A. Common Shares, it is possible that the Proposed Transaction may be approved by non-controlling shareholders representing as little as 1.2% of the total JBS S.A. Common Shares issued and outstanding (which combined with the 48.83% of the issued and outstanding JBS S.A. Common Shares held by our controlling shareholders as of June 30, 2023 amount to a majority of the JBS S.A. Common Shares outstanding). See “Risk Factors— Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.

Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters.

Are any JBS S.A. Shareholders already committed to vote in favor of the proposal to approve the Proposed Transaction?

We have not received any formal commitments to vote in favor of the Proposed Transaction yet. In addition, there is no voting agreement or understanding, formal or informal, with BNDESPar or other non-controlling shareholders.

 

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May I attend the JBS S.A. General Meeting?

If you hold JBS S.A. Common Shares on the day of the JBS S.A. General Meeting, you may attend the JBS S.A. General Meeting, provided that you present the appropriate documentation required by JBS S.A. for participation.

The documents and instructions for attendance of the JBS S.A. General Meeting will be available at JBS S.A.’s and CVM’s website in due course.

May I vote at the JBS S.A. General Meeting?

If you hold JBS S.A. Common Shares, you may vote at the JBS S.A. General Meeting, provided that you properly register to attend the JBS S.A. General Meeting. For more information, see “ –May I attend the JBS S.A. General Meeting?” above.

Because the JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting, if you hold JBS S.A. ADSs, you will not be entitled to participate in the JBS S.A. General Meeting unless you surrender your JBS S.A. ADSs in accordance with the provisions of the JBS S.A. ADS Deposit Agreement and receive the underlying JBS S.A. Common Shares prior to the date of the JBS S.A. General Meeting. See “The Proposed Transaction—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

How can I attend and vote on the JBS S.A. General Meeting?

JBS S.A. will convene the JBS S.A. General Meeting by publishing a notice in a major Brazilian newspaper (Valor Econômico). The first call notice must be published not less than three times, beginning at least 30 calendar days prior to the JBS S.A. General Meeting date. On the second call, the notice must be published not less than three times, beginning at least eight calendar days prior to the JBS S.A. General Meeting date.

Shareholders may attend the JBS S.A. General Meeting: (1) in person, if an individual; (2) by its legal representatives, if a legal entity (company or investment fund); or (3) by proxy, provided the shareholder complies with the applicable rules. For more information, see “JBS S.A. General Meeting—Manner of Voting.

The documents necessary for participating in the JBS S.A. General Meeting may be sent to JBS S.A. prior to the date for which the meeting was called in order for JBS S.A. to evaluate the request and grant access to the JBS S.A. General Meeting to the shareholder, if that is the case. The documents necessary for participating in the JBS S.A. General Meeting will be available at JBS S.A. Investor Relations website (https://ri.jbs.com.br/en/) and will also be disclosed to the market 30 days prior to the date of the JBS S.A. General Meeting. The information included on our website or that might be accessed through our website is not included in this prospectus or the registration statement and is not incorporated into this prospectus or the registration statement by reference.

With respect to the approval of the Merger of Shares, each JBS S.A. Common Share will be entitled to one vote at the JBS S.A. General Meeting.

What happens if I do not vote?

If you are a JBS S.A. Shareholder and you do not vote, you will receive the same treatment as the other JBS S.A. Shareholders. If the Proposed Transaction is not approved at the JBS S.A. General Meeting, you will continue to hold your JBS S.A. Common Shares.

Does the board of directors of JBS S.A. recommend the Proposed Transaction?

On                 , 2023, the board of directors of JBS S.A. approved convening the JBS S.A. General Meeting that will decide on the Proposed Transaction and recommended its approval.

 

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What is this document and why am I receiving it?

This document is a prospectus of JBS N.V. relating to the JBS N.V. BDRs that will be issued as the consideration upon completion of the Proposed Transaction, the JBS N.V. Class A Common Shares underlying the JBS N.V. BDRs and the JBS N.V. Class B Common Shares into which JBS N.V. Class A Common Shares may be converted during the Class A Conversion Period. It also informs JBS S.A. Shareholders of the upcoming JBS S.A. General Meeting at which JBS S.A. Shareholders will vote on, among other things, the Merger of Shares, the Delisting and the Cash Dividend, and provides details of the consideration JBS S.A. Shareholders will receive upon completion of the Proposed Transaction. You should carefully review this prospectus, because, as a JBS S.A. Shareholder, you will be entitled to vote at the JBS S.A. General Meeting that will be called in order for JBS S.A. Shareholders to approve the Merger of Shares, among other matters.

Questions and Answers about JBS N.V. and the Conversion

Who is JBS N.V.?

JBS B.V. is a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under Dutch law, with its corporate seat (statutaire zetel) in Amsterdam, the Netherlands. Prior to the Closing Date, JBS B.V. will be converted into a public limited liability company (naamloze vennootschap) under Dutch law, with the name “JBS N.V.” As of the date of this prospectus, the issuer is a wholly-owned subsidiary of JBS S.A. and has no revenues or business operations or material assets, liabilities or contingencies. JBS S.A. intends to transfer the issuer to LuxCo prior to the first step of the Restructuring described below.

The JBS Group intends to conduct a corporate restructuring process which, as described in this prospectus, ultimately aims to migrate the JBS S.A. Shareholders to become shareholders of JBS N.V.

As the first step in the Restructuring, prior to the Closing Date, JBS N.V. will, through a series of transactions, become the indirect controlling shareholder of JBS S.A. On July 7, 2023, our controlling shareholders entered into a binding and unconditional agreement with JBS N.V., HoldCo and LuxCo pursuant to which: (1) JBS S.A.’s controlling shareholders will contribute and transfer all of their JBS S.A. Common Shares at book value to LuxCo; (2) immediately thereafter, LuxCo will contribute and transfer all such JBS S.A. Common Shares at book value to JBS N.V. in exchange for 243,704,227 JBS N.V. Class A Common Shares and 297,860,722 JBS N.V. Class B Common Shares (whereby the difference in the value of the JBS S.A. Common Shares and the aggregate nominal value of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will be added to the general share premium reserve maintained by JBS N.V.); and (3) immediately thereafter, JBS N.V. will contribute and transfer such JBS S.A. Common Shares at book value to HoldCo in exchange for common shares of HoldCo. These transactions and transfers of equity interests must be consummated and completed no later than December 31, 2023. As a result of this step, JBS N.V. will, through HoldCo, indirectly hold the shares of JBS S.A. that are currently held directly by JBS S.A.’s controlling shareholders. Accordingly, JBS N.V. will become the indirect controlling shareholder of JBS S.A. This step will be subject to the same exchange ratio of one JBS N.V. Common Share for every two JBS S.A. Common Shares that will be applied to JBS S.A.’s non-controlling shareholders pursuant to the Merger of Shares and Redemption, which will result in each JBS S.A. shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V., the voting power of our controlling shareholders (held indirectly, through LuxCo) may increase substantially in relation to our non-controlling shareholders as a result of the aforementioned steps, depending on the number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares during the Class A Conversion Period.

The second and final step in the Restructuring, as further described in this prospectus, is to effect a Merger of Shares under which every two JBS S.A. Common Shares that are not held by HoldCo will be automatically

 

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contributed into HoldCo in exchange for one newly issued mandatorily redeemable preferred share of HoldCo. Each JBS S.A. Shareholder will receive HoldCo shares that are mandatorily redeemable for JBS N.V. BDRs, i.e., the HoldCo Redeemable Shares. Immediately following the Merger of Shares, HoldCo will redeem all of the HoldCo Redeemable Shares and deliver to each holder thereof JBS N.V. BDRs. Following this step, all of the shareholders of JBS S.A. immediately prior to the Merger of Shares will become shareholders of JBS N.V. through the JBS N.V. BDRs and HoldCo will hold 100% of the JBS S.A. Common Shares.

Immediately prior to the Closing Date, JBS N.V. will not own any material assets other than shares of HoldCo, and HoldCo will not hold any material assets other than the shares of JBS S.A. formerly directly held by our controlling shareholders. Neither JBS N.V. nor HoldCo will have any material liability or contingency. Therefore, the business of JBS N.V. and its consolidated subsidiaries following the completion of the Proposed Transaction will be the same as the business of JBS S.A. and its consolidated subsidiaries immediately prior to the Proposed Transaction.

Who will be the shareholders of JBS N.V. after completion of the Proposed Transaction?

If the Proposed Transaction is concluded, the same shareholders of JBS S.A. on the Last Trading Date will become shareholders of JBS N.V. Assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023, immediately upon completion of the Proposed Transaction, our controlling shareholders will (indirectly, through LuxCo) hold 100% of the then-outstanding JBS N.V. Class B Common Shares and 30.04% of the then-outstanding JBS N.V. Class A Common Shares, representing 85.03% of the aggregate voting power in JBS N.V, which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. For more information, see “Principal Shareholders.”

Will I have voting rights as a holder of JBS N.V. Class A Common Shares or JBS N.V. BDRs?

Yes, each JBS N.V. Class A Common Share (including JBS N.V. Class A Common Shares held as JBS N.V. BDRs) is entitled to one vote at a general meeting of shareholders of JBS N.V. The controlling shareholders will own JBS N.V. Class B Common Shares, and each JBS N.V. Class B Common Share is entitled to 10 votes at a general meeting of shareholders of JBS N.V. See “Description of Share Capital.” The procedure for voting if you hold JBS N.V. BDRs may be different. For more information, see “Description of JBS N.V. BDRs and Deposit Agreement.”

Will I have the right to receive dividends, as a holder of JBS N.V. Class A Common Shares or JBS N.V. BDRs?

Yes. Each JBS N.V. Class A Common Share (including JBS N.V. Class A Common Shares held as JBS N.V. BDRs) and JBS N.V. Class B Common Share is entitled to receive dividends, if and when resolved upon by the general meeting of shareholders of JBS N.V. and subject to the capital requirements imposed by Dutch law. A holder of a JBS N.V. Class A Common Share (including JBS N.V. Class A Common Shares held as JBS N.V. BDRs) is entitled to receive the same amount of dividends per share as a holder of a JBS N.V. Class B Common Share. For further information on dividends, see “Per Share, Dividend and Market Data—Historical Dividend Data.”

 

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What are the differences between JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares?

Each JBS N.V. Class A Common Share is entitled to one vote per share and each JBS N.V. Class B Common Share is entitled to 10 votes per share at a general meeting of shareholders of JBS N.V.

JBS N.V. intends to apply to list the JBS N.V. Class A Common Shares on the NYSE. JBS N.V. Class B Common Shares will not be listed on any exchange and, pursuant to JBS N.V.’s articles of association, each JBS N.V. Class B Common Share may be converted into one JBS N.V. Class A Common Share and one JBS N.V. Conversion Share upon (i) a resolution by the board of directors following delivery of a conversion request to the board of directors, or (ii) automatically upon the enforcement of a security interest over such JBS N.V. Class B Common Share (including, but not limited to, a right of pledge), which results in a transfer of such JBS N.V. Class B Common Share.

The rights of the two classes of JBS N.V Common Shares are otherwise identical. See “Description of Share Capital.”

Can I convert my JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares?

Except during the Class A Conversion Period, holders of JBS N.V. Class A Common Shares will not be able to request to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares.

During the Class A Conversion Period, if you are an Eligible Shareholder, you may request to convert all or a portion of your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares, which we refer to as the Maximum Convertible Shares, equals the number of JBS N.V. BDRs to which such Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction).

Except with respect to conversion requests submitted during the Last Conversion Quarter, the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to the Maximum Conversion Rate of 55% of such Eligible Shareholder’s Maximum Convertible Shares. During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the Last Conversion Quarter (i.e., the fourth quarter of 2026), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float of 20%, the number of JBS N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion

 

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Record Date. For the avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes. Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be. Following the end of each fiscal quarter, JBS N.V. will disclose to the market the number of JBS N.V. Class A Common Shares that were converted into JBS N.V. Class B Common Shares pursuant to the procedures described above.

If you are an Eligible Shareholder who wishes to exercise your right to convert your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you will be required to follow certain procedures as described in “The Proposed Transaction—Class A Conversion Period,” including providing a conversion notice and supporting documentation. In addition, in order to convert your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you must first cancel the JBS N.V. BDRs you received in connection with the Proposed Transaction and receive the underlying JBS N.V. Class A Common Shares. See “The Proposed Transaction—Receiving JBS N.V. Class A Common Shares.” These procedures may be cumbersome and time consuming and hinder your ability to timely request a conversion during the Class A Conversion Period. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—You may experience delays or be unable to timely request the conversion of your JBS N.V. Class A Common Shares during the Class A Conversion Period.”

Following the Class A Conversion Period, JBS N.V. Class A Common Shares will no longer be convertible into JBS N.V. Class B Common Shares, but JBS N.V. Class B Common Shares will remain convertible into JBS N.V. Class A Common Shares and JBS N.V. Conversion Shares upon (i) a resolution by the board of directors following delivery of a conversion request to the board of directors, or (ii) automatically upon the enforcement of a security interest over such JBS N.V. Class B Common Share (including, but not limited to, a right of pledge), which results in a transfer of such JBS N.V. Class B Common Share. The JBS N.V. Conversion Shares are introduced to facilitate a 1:1 conversion of JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares under Dutch law. For more information, see “Description of Share Capital—Conversion.”

Who may request to convert JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period?

Only our controlling shareholders (through LuxCo) and Eligible Shareholders may request to convert JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period.

You are an Eligible Shareholder if you are entitled to one or more JBS N.V. BDRs at the opening of trading on the Conversion Record Date. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. BDRs to which the Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (thereby disregarding any fractional JBS N.V. BDRs). The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo on the Conversion Record Date.

If I purchase JBS N.V. BDRs or JBS N.V. Class A Common Shares following the Conversion Record Date, will I be entitled to convert my JBS BDRs or JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares?

If you purchase JBS N.V. BDRs after opening of trading on the Conversion Record Date, you will be able to request the cancellation of all or a portion of your JBS N.V. BDRs and receive the underlying JBS N.V. Class A

 

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Common Shares by: (1) instructing your broker or custodian operating in Brazil to cancel your JBS N.V. BDRs with the JBS N.V. BDR Depositary Bank; and (2) delivering evidence that all fees and potential taxes due in connection with this service were duly paid, as set forth in the JBS N.V. BDR Deposit Agreement. For more information, see “The Proposed Transaction—Receiving JBS N.V. Class A Common Shares.” However, you will not be eligible to convert your additional JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares as the maximum number of JBS N.V. Class A Common Shares for which you may request a conversion into JBS N.V. Class B Common Shares is equal to the number of JBS N.V. BDRs to which you were entitled at the opening of trading on the Conversion Record Date. Similarly, if you purchase JBS N.V. Class A Common Shares after the Conversion Record Date, you will not be eligible to convert such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares.

Will I have to incur any costs to convert my JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares?

If you are an Eligible Shareholder and choose to convert all or a portion of your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you will have to incur the costs of cancelling your JBS N.V. BDRs in order to receive the underlying JBS N.V. Class A Common Shares and complying with the conversion procedures established in our articles of association, including delivery of a Class A Conversion Request to our board of directors. You will not, however, be required to pay up the difference between the aggregate nominal value of the JBS N.V. Class A Common Shares to which your Class A Conversion Request pertains and the aggregate nominal value of the JBS N.V. Class B Common Shares into which your JBS N.V. Class A Common Shares are converted. Our board of directors will resolve to pay up such amount at the charge of the general share premium reserve maintained by JBS N.V. See “The Proposed Transaction—Class A Conversion Period.”

May I withdraw my request to convert my JBS N.V. Class A Common Shares to JBS N.V. Class B Common Shares?

No. Once you have sent your Class A Conversion Request to our board of directors, you will not be able to rescind such request. If you wish to receive JBS N.V. Class A Common Shares after having submitted a Class A Conversion Request, you must wait until your JBS N.V. Class A Common Shares are converted into JBS N.V. Class B Common Shares and follow the procedures to convert your JBS N.V. Class B Common Shares back into JBS N.V. Class A Common Shares pursuant to the procedures established in our articles of association. See “Description of Share Capital—Conversion—Class B Common Shares into Class A Common Shares.”

After I submit my request to convert my JBS N.V. Class A Common Shares to JBS N.V. Class B Common Shares, may I transfer my JBS N.V. Class A Common Shares?

No. Once you have sent your Class A Conversion Request to our board of directors, you will be subject to your undertaking not to transfer the JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains. This restriction continues until (and including) the day on which the JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains are converted into JBS N.V. Class B Common Shares. See “Description of Share Capital—Conversion—Class A Common Shares into Class B Common Shares.

What are the differences between the rights of JBS S.A. Shareholders and holders of JBS N.V. Common Shares?

Rights of shareholders of JBS N.V. and rights of JBS S.A. Shareholders may be significantly different. While JBS S.A. is a Brazilian corporation listed on B3, and subject to Brazilian Corporation Law, CVM regulation and B3 Novo Mercado listing rules, JBS N.V. is a Dutch company, subject to Dutch law, including the Dutch Civil Code, SEC regulation and NYSE listing rules. For a summary of the material differences between the rights of JBS S.A. Shareholders and JBS N.V. shareholders, see “Comparison of the Rights of Holders of JBS N.V. Shares and JBS S.A. Common Shares.”

 

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Additionally, in connection with the listing of JBS N.V. BDRs, JBS N.V. expects to apply to have its BDRs classified as Level II BDRs pursuant to Brazilian regulation, in which case JBS N.V. will be required to obtain a registration as a foreign issuer in Brazil before the CVM and, consequently, comply with certain disclosure requirements set forth in the Brazilian regulation, including annually filing a formulário de referência (a document which contains financial, legal and operating information about the filer), providing quarterly financial information and certain periodical filings disclosing material events.

Questions and Answers about Other Issues

Can I sell my JBS S.A. Common Shares after the JBS S.A. General Meeting?

Subject to the observance of applicable legal requirements, JBS S.A. Common Shares will continue to be listed on B3 and be eligible for trading over B3 under their existing ticker symbol until the Last Trading Day.

Will I have to pay any brokerage commission in connection with the Proposed Transaction?

You will not have to pay brokerage commissions if your JBS S.A. Common Shares are registered in your name. If your JBS S.A. Common Shares are held through a bank or broker or a custodian linked to a stock exchange, you should consult with them as to whether or not they charge any transaction fee or service charges in connection with the Merger of Shares or the other elements of the Proposed Transaction.

What are the U.S. federal income tax consequences of the Proposed Transaction to JBS S.A. Shareholders?

The Merger of Shares and Redemption, when taken together with certain other steps of the Restructuring, including the LuxCo transfer of shares of JBS S.A. to JBS N.V. in exchange for JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares, are expected to be treated as part of an integrated transaction qualifying as a nonrecognition transaction for U.S. federal income tax purposes. If the Merger of Shares and Redemption qualify as a nonrecognition transaction, then U.S. Holders will not recognize any gain or loss with respect to the exchange of their JBS S.A. Common Shares for the HoldCo Redeemable Shares or the redemption of the HoldCo Redeemable Shares for JBS N.V. BDRs in the Proposed Transaction. This tax treatment, however, is not free from doubt and the IRS could disagree with this treatment.

If the Merger of Shares and Redemption do not qualify as a nonrecognition transaction, and therefore are a fully taxable transaction for U.S. federal income tax purposes, a U.S. holder of JBS S.A. Common Shares generally would recognize taxable gain or loss in an amount equal to the difference between the fair market value of any JBS. N.V. BDRs or JBS N.V. Class A Common Shares received on the date of exchange and its tax basis in the JBS S.A. Common Shares exchanged, in each case determined in U.S. dollars.

We expect that the Cash Dividend will be reported to U.S. Holders as a dividend taxable at ordinary income rates.

You should read the section entitled “Taxation—Material U.S. Federal Income Tax Consequences” for more information on the U.S. federal income tax consequences of the Proposed Transaction and you should consult your own tax advisors regarding the tax consequences of the Proposed Transaction in your particular circumstances.

What are the Brazilian income tax consequences of the Proposed Transaction to JBS S.A. Shareholders?

The Merger of Shares (incorporação de ações) of JBS S.A. Common Shares into HoldCo and the subsequent Redemption may trigger the recognition of gains subject to taxation in Brazil. The tax rates applicable to these gains would depend on the type, domicile and regime of the corresponding holder. You should read the section entitled “Taxation—Material Brazilian Tax Consequences” for more information on the Brazil income tax consequences of the Proposed Transaction. This section also describes the income tax treatment applicable to dividends or other similar income arising from JBS N.V. Class A Common Shares and JBS N.V. BDRs earned by Brazilian holders, which may be subject to income tax in accordance with the applicable regime for investments held outside Brazil. Such rules are different from the rules applicable to direct investments in a Brazilian company (such as JBS S.A.) and do not provide for certain benefits such as the tax exemption on the distribution of dividends currently in force.

 

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You should consult your own tax advisors regarding the tax consequences of the Proposed Transaction in your particular circumstances.

What are the Dutch tax consequences of the Proposed Transaction to JBS S.A. Shareholders?

The Dutch tax consequences of the Proposed Transaction for a JBS S.A. Shareholder will depend in part on such holder’s circumstances. For JBS S.A. Shareholders that are not a tax resident of the Netherlands, save in the circumstances as described in section “Taxation—Material Dutch Tax Consequences,” the Merger of Shares of JBS S.A. Common Shares into HoldCo and the subsequent Redemption should generally not trigger recognition of gains that are taxable in the Netherlands. In any event, a holder is urged to consult his own tax advisor for a full understanding of the tax consequences of the Proposed Transaction, including the applicability and effect of Dutch tax laws.

Are there risks associated with the Proposed Transaction?

Yes. There are a number of risks related to the Proposed Transaction that are discussed in this prospectus. In evaluating the Proposed Transaction, before making any decision on whether and how to vote, you are urged to read carefully and in its entirety this prospectus, in particular the section entitled “Risk Factors.”

Who can help answer my questions?

The information provided above in the question-and-answer format is for your convenience only and is merely a summary of some of the information contained elsewhere in this prospectus. You should read carefully the entire prospectus, including the information in the exhibits to the registration statement of which this prospectus is a part. See “Where You Can Find Additional Information.”

If you have any questions about the Proposed Transaction, please contact JBS S.A.’s investor relations office by phone at (+55 11) 3144-4146 and by e-mail at ri@jbs.com.br.

 

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SUMMARY

The following summary highlights some of the information contained in this prospectus but does not contain all of the information that may be important to you. We urge you to read the entire prospectus carefully, including the sections entitled “Risk Factors” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” Information about JBS N.V.,” “Information about JBS S.A.” and JBS S.A.’s financial statements and the notes thereto included elsewhere in this prospectus.

JBS N.V.

The issuer was incorporated on October 9, 2019 as a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under Dutch law, with its corporate seat (statutaire zetel) in Amsterdam, the Netherlands, and is currently named “JBS B.V.” Prior to the Closing Date, the issuer will be converted into a public limited liability company (naamloze vennootschap) under Dutch law with the name “JBS N.V.” As of the date of this prospectus, the issuer is a wholly-owned subsidiary of JBS S.A. and has no revenues or business operations or material assets, liabilities or contingencies. JBS S.A. intends to transfer the issuer to LuxCo prior to the first step of the corporate restructuring described elsewhere in this prospectus.

The JBS Group intends to conduct a corporate restructuring process which, as described in this prospectus, ultimately aims to migrate the JBS S.A. Shareholders to become shareholders of JBS N.V. Therefore, the business of JBS N.V. and its consolidated subsidiaries following the completion of the Proposed Transaction will be the same as the business of JBS S.A. and its consolidated subsidiaries immediately prior to the Proposed Transaction.

If the Proposed Transaction is concluded, the same shareholders of JBS S.A. will become shareholders of JBS N.V. Assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023, immediately upon completion of the Proposed Transaction, our controlling shareholders will (indirectly, through LuxCo) hold 100% of the then-outstanding JBS N.V. Class B Common Shares and 30.04% of the then-outstanding JBS N.V. Class A Common Shares, representing 85.03% of the aggregate voting power in JBS N.V., which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. For more information, see “Principal Shareholders.”

The issuer’s registered office is located at Stroombaan 16, 5th Floor, 1181 VX, Amstelveen, Netherlands. The issuer’s telephone number is +31 20 656 47 00. As soon as reasonably practicable after the completion of the Proposed Transaction, we plan to establish a website that will allow you to access certain information but such website or information will not constitute a part of this prospectus. The issuer’s agent for service of process in the United States is JBS USA Food Company, located at 1770 Promontory Circle, Greeley, Colorado 80634, and its telephone number is +1 (970) 506-8000.

 

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JBS S.A.

Overview

We are the largest protein company and the largest food company in the world in terms of net revenue for the year ended December 31, 2022, according to Bloomberg’s Food Index and publicly available sources. Our net revenue was US$16.7 billion and US$17.4 billion for the three-month periods ended March 31, 2023 and 2022, respectively, and US$72.6 billion, US$65.0 billion and US$52.3 billion for the years ended December 31, 2022, 2021 and 2020, respectively. We recorded a net loss of US$0.3 billion for the three-month period ended March 31, 2023, compared to a net income of US$1.0 billion for the three-month period ended March 31, 2022. Our net income was US$3.1 billion, US$3.8 billion and US$0.6 billion for the years ended December 31, 2022, 2021 and 2020, respectively. Our Adjusted EBITDA was US$0.4 billion and US$1.9 billion for the three-month periods ended March 31, 2023 and 2022, respectively, and US$6.7 billion, US$8.5 billion and US$5.6 billion for the years ended December 31, 2022, 2021 and 2020, respectively. Through strategic acquisitions and capital investment, we have created a diversified global platform that allows us to prepare, package and deliver fresh and frozen, value-added and branded beef, poultry, pork, fish and lamb products to leading retailers and foodservice customers. We sell our products to more than 335,000 customers worldwide in approximately 180 countries on six continents.

As of March 31, 2023, we were:

 

   

the #1 global beef producer in terms of capacity, with operations in the United States, Australia, Canada and Brazil and an aggregate daily processing capacity of approximately 75,190 heads of cattle according to Nebraska Public Media;

 

   

the #1 global poultry producer in terms of capacity, with operations in the United States, Brazil, United Kingdom, Mexico, Puerto Rico and Europe, and an aggregate daily processing capacity of approximately 13.6 million chickens according to WATT Poultry, a global resource for the poultry meat industries;

 

   

the #2 largest global pork producer in terms of capacity, with operations in the United States, Brazil, the United Kingdom, Australia and Europe, and an aggregate daily processing capacity of approximately 139,490 hogs according to WATT Poultry;

 

   

a leading lamb producer in terms of capacity, with operations in Australia and Europe and an aggregate daily processing capacity of approximately 21,600 heads;

 

   

a regional leading fish producer in terms of capacity, with operations in Australia and an aggregate daily processing capacity of approximately 39,200 fish; and

 

   

a significant global producer of value-added and branded meat products.

We primarily sell protein products, which include fresh and frozen cuts of beef, pork, lamb, fish, whole chickens and chicken parts, to retailers (such as supermarkets, club stores and other retail distributors), and foodservice companies (such as restaurants, hotels, foodservice distributors and additional processors). Our food products are marketed under a variety of national and regional brands, including: in North America, “Swift,” “Just Bare,” “Pilgrim’s Pride,” “1855,” “Gold Kist Farms,” “Del Dia,” “Northern Gold” and “Canadian Diamond” and premium brand “Sunnyvalley”; in Brazil, “Swift,” “Seara,” “Friboi, “Maturatta,” “Reserva Friboi,” “Seara Da Granja,” “Seara Nature,” “Massa Leve,” “Marba,” “Doriana,” “Delícia,” “Primor,” “Delicata,” “Incrível,” “Rezende,” “LeBon,” “Frango Caipira Nhô Bento,” “Seara Turma da Mônica,” and premium brands “1953,” “Seara Gourmet,” “Hans” and “Eder”; in Australia, “Great Southern” and “AMH”; and in Europe, “Moy Park” and “O’Kane.” We also produce value-added and branded products marketed, primarily under our portfolio of widely recognized consumer brands in some of our key markets, including “Seara” in Brazil, “Primo,” “Rivalea” and “Huon” in Australia and “Beehive” in New Zealand.

 

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We are geographically diversified. In the three-month periods ended March 31, 2023 and 2022 and in the year ended December 31, 2022, we generated 76.8%, 74.1% and 73.6%, respectively, of our net revenue from sales in the countries where we operate our facilities, which we classify as domestic sales, and 23.2%, 25.9% and 26.4%, respectively, of our net revenue represented export sales. The United States, Brazil and Australia are leading exporters of protein to many fast-growing markets, including Asia, Africa and the Middle East. Asia represented 49.4%, 53.8% and 58.1% of our net revenue from export sales in the three-month periods ended March 31, 2023 and 2022 and in the year ended December 31, 2022, respectively, primarily from sales in China, Japan and South Korea. Africa and the Middle East collectively represented 13.9%, 13.6% and 15.4% of our net revenue from export sales in the three-month periods ended March 31, 2023 and 2022 and in the year ended December 31, 2022, respectively.

JBS S.A.’s headquarters are located at Av. Marginal Direita do Tietê, 500, Bloco I, 3rd Floor, CEP 05118-100, in the City of São Paulo, State of São Paulo, Brazil, and our phone number is (+55 11) 3144-4000. JBS S.A.’s Investor Relations Department is located in its management office at Av. Marginal Direita do Tietê, 500, CEP 05118-100, in the City of São Paulo, State of São Paulo, Brazil, and may be contacted by phone at (+55 11) 3144-4146 and by e-mail at ir@jbs.com.br. JBS S.A.’s website is www.jbs.com.br. Information contained on or obtainable through JBS S.A.’s website is not incorporated into, and does not constitute a part of, this prospectus.

The JBS S.A. Common Shares are listed on the Novo Mercado segment (the highest level of corporate governance requirements) of the B3 under the symbol “JBSS3”.

Our management uses net revenue, along with Adjusted EBITDA and Adjusted EBITDA Margin, to measure our performance. The following table sets forth some of our financial information for the periods indicated.

 

     For the three-month period
ended March 31,
    For the year ended December 31,  
     2023     2022     2022     2021     2020  
     (in millions of US$, except percentages)  

Net revenue

     16,687.2       17,364.1       72,613.9       65,042.7       52,331.2  

Net income (loss)

     (275.2     1,039.3       3,143.5       3,818.6       635.7  

Net margin (1)

     (1.6 )%      6.0     4.3     5.9     1.2

Adjusted EBITDA (2)

     416.3       1,927.1       6,722.0       8,486.4       5,636.6  

Adjusted EBITDA margin (3)

     2.5     11.1     9.3     13.0     10.8

 

(1)

Net margin is calculated by dividing net income by net revenue.

(2)

Adjusted EBITDA is used as a measure of performance by our management. Adjusted EBITDA is calculated by making the following adjustments, as further described in this prospectus (see “Summary—Summary Historical Financial Data”), to net income: exclusion of net finance expenses; exclusion of current and deferred income taxes; exclusion of depreciation and amortization expenses; exclusion of share of profit of equity-accounted investees, net of tax; exclusion of expenses with the DOJ and antitrust agreements; exclusion of donations and social programs expenses; exclusion of out of period tax credits impacts; exclusion of JBS fund for the Amazon; exclusion of J&F Leniency expenses refund; and exclusion of certain other income (expenses), net. Adjusted EBITDA is not a measure required by or calculated in accordance with IFRS and should not be considered as a substitute for income from continuing operations, net income or any other measure of financial performance reported in accordance with IFRS or as measures of operating cash flows or liquidity. You should rely primarily on our IFRS financial information, and use Adjusted EBITDA in a supplemental manner in making your investment decision. For more information about the limitations of Adjusted EBITDA, see “Presentation of Financial and Other Information—

 

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  Non-GAAP Financial Measures.” For a reconciliation of Adjusted EBITDA to net income, see “—Summary Historical Financial Data.”
(3)

Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by net revenue.

Set forth below is a map showing, by region, the geographic distribution of our more significant brands and percentage contribution to our net revenue for the three-month period ended March 31, 2023, based on location of sale for the same period.

 

 

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We have grown our business rapidly through strategic acquisitions and organic growth via a continuous focus on efficient capital investment targeted at high-return opportunities. As set forth in the charts below, we have grown our business from US$38.6 billion in net revenue in 2012 to US$72.6 billion in net revenue in 2022, representing a 6.5% compound annual growth rate (“CAGR”) since 2012, while growing net income from US$0.4 billion in 2012 to US$3.1 billion in 2022, representing a 23.3% CAGR, and Adjusted EBITDA (calculated as set forth below) from US$2.2 billion in 2012 to US$6.7 billion in 2022, representing a 12.0% CAGR over the same period of time. To calculate CAGR, we divided the value of the period in question by its value for the earliest comparative period, raised the result to the power of one divided by the number of intervening periods, and subtracted one from the subsequent result.

 

 

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In order to efficiently manage our global operations, we are organized according to the following seven business segments:

 

   

Brazil. Our Brazil segment includes all the operating activities from JBS S.A., mainly represented by slaughter facilities, cold storage and meat processing, fat, feed and production of beef by-products, such as leather, collagen and other products produced in Brazil. In the three-month periods ended March 31, 2023, and 2022, our Brazil segment had net revenue of US$2.3 billion and US$2.7 billion, respectively, and Adjusted EBITDA of US$57.1 million and US$83.7 million, respectively. In 2022, our Brazil segment had net revenue of US$11.4 billion and Adjusted EBITDA of US$468.9 million.

 

   

Seara. Our Seara segment includes all of the operating activities of Seara and its subsidiaries, mainly represented by chicken and pork processing, production and commercialization of food products and value-added products. In the three-month periods ended March 31, 2023 and 2022, our Seara segment had net revenue of US$2.0 billion and US$1.8 billion, respectively, and Adjusted EBITDA of US$28.3 million and US$117.7 million, respectively. In 2022, our Seara segment had net revenue of US$8.3 billion and Adjusted EBITDA of US$896.7 million.

 

   

Beef North America. Our Beef North America segment includes JBS USA’s beef processing operations in North America and the plant-based businesses in Europe. Beef North America also sells by-products to the variety meat, feed processing, fertilizer, automotive and pet food industries and also produces value-added meat products including toppings for pizzas. Finally, Sampco LLC imports processed meats and other foods such as canned fish, fruits and vegetables to the United States and Vivera produces and sells plant-based protein products in Europe. In the three-month periods ended March 31, 2023 and 2022, our Beef North America segment had net revenue of US$5.3 billion and US$5.5 billion, respectively, and Adjusted EBITDA of US$22.3 million and US$785.1 million, respectively. In 2022, our Beef North America segment had net revenue of US$22.1 billion and Adjusted EBITDA of US$2.1 billion.

 

   

Pork USA. Our Pork USA segment includes JBS USA’s pork operations, including Swift Prepared Foods. As a complement to our pork processing business, we also conduct business through our hog production operations, including four hog farms and five feed mills, from which, we will source live hogs for our pork processing operations. In the three-month periods ended March 31, 2023 and 2022, our Pork USA segment had net revenue of US$1.8 billion and US$1.9 billion, respectively, and Adjusted EBITDA of US$44.6 million and US$235.6 million, respectively. In 2022, our Pork USA segment had net revenue of US$8.2 billion and Adjusted EBITDA of US$756.3 million.

 

   

Pilgrim’s Pride. Our Pilgrim’s Pride segment includes PPC’s operations, including Moy Park, Tulip, PFM, PPL and Pilgrim’s Consumer Foods as well, mainly represented by chicken processing, production and commercialization of food products and prepared foods in the United States, Mexico, United Kingdom and France. The fresh chicken products consist of refrigerated (non-frozen) whole or cut-up chicken, either pre-marinated or non-marinated, and pre-packaged chicken in various combinations of freshly refrigerated, whole chickens and chicken parts. The prepared chicken products include portion-controlled breast fillets, tenderloins and strips, delicatessen products, salads, formed nuggets and patties and bone-in chicken parts. These products are sold either refrigerated or frozen and may be fully cooked, partially cooked or raw. In addition, these products are breaded or non-breaded and either pre-marinated or non-marinated. In the three-month periods ended March 31, 2023 and 2022, our Pilgrim’s Pride segment had net revenue of US$4.2 billion and US$4.2 billion, respectively, and Adjusted EBITDA of US$268.7 million and US$612.9 million, respectively. In 2022, our Pilgrim’s Pride segment had net revenue of US$17.5 billion and Adjusted EBITDA of US$2.1 billion.

 

   

Australia. Our Australia segment includes our fresh, frozen, value-added and branded beef, lamb, pork and fish products in Australia and New Zealand. We also operate lamb, sheep, pork and fish processing facilities in Australia and New Zealand. In the three-month periods ended March 31, 2023 and 2022, our Australia

 

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segment had net revenue of US$1.4 billion and US$1.4 billion, respectively, and Adjusted EBITDA of US$(3.4) million and US$85.1 million, respectively. In 2022, our Australia segment had net revenue of US$6.3 billion and Adjusted EBITDA of US$443.9 million.

 

   

Others. Our Others segment includes certain operations not directly attributable to our primary segments set forth above, such as corporate expenses, international leather operations and other operations in Europe. In the three-month periods ended March 31, 2023 and 2022, our Others segment had net revenue of US$244.6 million and US$190.2 million, respectively, and Adjusted EBITDA of US$(0.7) million and US$7.5 million, respectively. In 2022, our Others segment had net revenue of US$842.0 million and Adjusted EBITDA of US$(7.9) million.

The following charts set forth the proportion our total net revenue and Adjusted EBITDA by segment for the three-month periods ended March 31, 2023 and 2022 and the year ended December 31, 2022. For a reconciliation of Adjusted EBITDA to net income, see “—Summary Historical Financial Data.

 

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(1)

Does not consider intercompany eliminations.

 

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(1)

Does not consider intercompany eliminations.

 

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(1)

Does not consider intercompany eliminations.

Recent Developments

Issuance of PPC’s 6.250% Senior Notes due 2033

On April 19, 2023, PPC issued US$1.0 billion aggregate principal amount of 6.250% senior notes due 2033. The notes are guaranteed on a senior unsecured basis by PPC’s domestic wholly-owned restricted subsidiaries that are guarantors of its U.S. credit facility. PPC used the net proceeds from the offering of the notes to repay the outstanding term loans under its U.S. credit facility. The remaining proceeds will be used for general corporate purposes.

JBS USA Announces New Chief Executive Officer

On April 27, 2023, JBS USA announced that its chief executive officer, Tim Schellpeper, made the decision to retire from his role effective May 1, 2023. Wesley Mendonça Batista Filho, with more than 13 years of experience in the JBS Group, assumed the role of chief executive officer of JBS USA.

Declaration of Interim Dividends

At a meeting held on June 19, 2023, the board of directors of JBS S.A. approved the distribution of interim dividends based on the balance of the profit reserves determined on the balance sheet dated of December 31, 2022. The aggregate amount of the interim dividends declared is R$2.22 billion, which will be paid on June 29, 2023, based on a shareholder record date of June 22, 2023.

Drawdown of JBS USA Senior Unsecured Revolving Facility

On May 18, 2023, JBS USA drew down US$112 million under an unsecured revolving credit facility (the “Senior Unsecured Revolving Facility”) entered into on November 1, 2022, between JBS USA, JBS USA Food Company, JBS USA Finance, Inc., JBS Australia and JBS Canada, as borrowers, and Bank of Montreal, as administrative agent, and the lender parties thereto. The Senior Unsecured Revolving Facility provides for a revolving credit commitment in an amount up to US$1,500.0 million with a maturity in 2027, with two one-year extension options at each lender’s discretion. The facility is available in two tranches of US$900.0 million and US$600.0 million and in multiple currencies, subject to sub-limits with respect to any amounts borrowed in currencies other than amounts borrowed in dollars. These loans bear interest at the applicable benchmark rate or the prime rate plus applicable margins that are based on the corporate credit or family rating of JBS USA. For more information, see “Description of Material Indebtedness—JBS USA Senior Unsecured Revolving Facility.”

 

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Filing of Debt Registration Statement

Holders of certain series of notes co-issued by JBS USA benefit from registration rights set forth in registration rights agreements entered into by JBS USA on August 19, 2022, pursuant to which JBS USA agreed to use its commercially reasonable efforts to consummate an exchange offer (the “JBS USA Exchange Offer”) within 365 days of entering into such registration rights agreement to allow holders of such series of notes to exchange their notes for the same principal amount of registered exchange notes. For more information, see “Description of Material IndebtednessFixed Rate Notes.” A registration statement on Form F-4 relating to the JBS USA Exchange Offer (the “Debt Registration Statement”) was filed with the SEC on May 19, 2023 but has not yet become effective. No securities pursuant to the Debt Registration Statement may be sold and no offers to buy be accepted in connection with the JBS USA Exchange Offer prior to the time the Debt Registration Statement becomes effective. In addition, the Debt Registration Statement shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities in connection with the JBS USA Exchange Offer in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy any securities in connection with the Debt Registration Statement.

Fire at Beef Processing Facility in Brazil

On June 10, 2023, a beef processing facility located in the city of Diamantino, in the state of Mato Grosso, Brazil, caught fire affecting most of the facility. JBS S.A. maintains certain insurance coverage intended to cover such circumstances. The Diamantino facility had a slaughter capacity of 3,000 head per day. We are still analyzing the impacts of the fire.

Declaration of Interim Dividends

At a meeting held on June 19, 2023, the board of directors of JBS S.A. approved the distribution of interim dividends based on the balance of the profit reserves determined on the balance sheet dated of December 31, 2022. The aggregate amount of the interim dividends declared is R$2.22 billion, which was paid on June 29, 2023, based on a shareholder record date of June 22, 2023.

Risk Factors

The Proposed Transaction involves risks, some of which are related to the Proposed Transaction itself and others of which are related to our businesses and to investing in and ownership of JBS N.V. Class A Common Shares and JBS N.V. BDRs. You should carefully consider the information about these risks set forth under the section entitled “Risk Factors”, together with the other information included in this prospectus.

The following is a summary of some of the principal risks we face:

Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs

 

   

The dual class structure of the JBS N.V. Common Shares has the effect of concentrating voting control with our Class B shareholders and limiting our other shareholders’ ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of JBS N.V. Class A Common Shares may view as beneficial.

 

   

Our shareholders are not subject to lock-up restrictions and may sell JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs at any time, subject to applicable law.

 

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There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.

 

   

The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares may harm the value and liquidity of the JBS N.V. Class A Common Shares.

 

   

We may issue additional JBS N.V. Class A Common Shares and/or JBS N.V. Class B Common Shares in the future, which may dilute your interest in JBS N.V.’s share capital and affect the trading price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

 

   

Following the Proposed Transaction JBS N.V. will become a U.S. public reporting company subject to U.S. financial reporting rules and regulations and other requirements of the SEC. Our accounting and other management systems and resources may not be immediately prepared to meet these requirements, which may strain our resources.

Risks Relating to Our Business and Industries

 

   

Our results of operations may be adversely affected by fluctuations in market prices for, and the availability of, livestock and animal feed ingredients.

 

   

Outbreaks of animal diseases may affect our ability to conduct our business and harm demand for our products.

 

   

Any perceived or real health risks related to the food industry could adversely affect our ability to sell our products. If our products become contaminated, we may be subject to product liability claims and product recalls.

 

   

Changes in consumer preferences and/or negative perception of the consumer regarding the quality and safety of our products could adversely affect our business.

 

   

We face competition in our business, which may adversely affect our market share and profitability.

Risks Relating to the Markets in Which We Operate

 

   

Deterioration of global economic conditions could adversely affect our business.

 

   

Our exports pose special risks to our business and operations.

 

   

We are subject to ordinary course audits in the jurisdictions where we operate and changes in tax laws and unanticipated tax liabilities, in either case, could adversely affect the taxes we pay and therefore our financial condition and results of operations.

 

   

We are exposed to emerging and developing country risks.

 

   

Market fluctuations could negatively impact our operating results, and our business may be adversely impacted by risks related to hedging activities.

Corporate Governance

Foreign Private Issuer Status

JBS N.V. will be considered a “foreign private issuer” under U.S. securities laws and the NYSE rules, and we intend to rely on corporate governance exemptions available to foreign private issuers under NYSE rules. See “Management—Corporate Governance Practices” and “Risk Factors—Risks Relating to the Proposed

 

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Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—As a foreign private issuer, we are permitted to follow certain home country corporate governance practices instead of otherwise applicable NYSE requirements” for more information.

Dutch Law

JBS N.V. is also subject to the Dutch Civil Code. In addition, a company having its official seat in the Netherlands, and its shares admitted to listing on a stock exchange, including a company with shares listed on the NYSE, is required under Dutch law to disclose in its board report whether it complies with the provisions of the Dutch Corporate Governance Code and, if not, to explain the reasons for such deviations. The Dutch Corporate Governance Code contains principles and best practice provisions that regulate relations between a company’s board of directors and its shareholders (e.g., the general meeting of shareholders) and its audit and financial reporting functions.

JBS N.V. intends to comply with the relevant best practice provisions of the Dutch Corporate Governance Code, except as may be noted from time to time in its board report.

Controlled Company Exemption

Immediately upon completion of the Proposed Transaction, our controlling shareholders will own (indirectly, through LuxCo) 100% of the issued and outstanding JBS N.V. Class B Common Shares and 30.04% of the issued and outstanding JBS N.V. Class A Common Shares, which will represent 85.03% of the aggregate voting power in JBS N.V. (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023), which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. As a result, we may be a “controlled company” within the meaning of the corporate governance standards of the NYSE. Under NYSE rules, a “controlled company” (which is a company of which more than 50% of the voting power is held by an individual, group or another company) may elect not to comply with certain NYSE corporate governance standards. See “Management—Corporate Governance Practices” for more information. If we were to lose our foreign private issuer status but remain a controlled company, we may elect in the future to avail ourselves of the “controlled company” exemptions under NYSE corporate governance rules. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—As a foreign private issuer, we are permitted to follow certain home country corporate governance practices instead of otherwise applicable NYSE requirements” for more information.

 

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SUMMARY OF THE PROPOSED TRANSACTION

The following is a brief summary of the terms of the Proposed Transaction. This summary may not contain all the information that is important to you. Please see “The Proposed Transaction,” “Risk Factors” and “Taxation” for a more detailed description of the matters described below.

 

The Proposed Transaction

The Proposed Transaction will consist of the three steps below:

 

   

Merger of Shares. Subject to approval at the JBS S.A. General Meeting, on the Closing Date, the Merger of Shares will be implemented through an incorporação de ações under the Brazilian Corporation Law. Pursuant to the Merger of Shares, every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo will be automatically contributed for their book value into HoldCo in exchange for one HoldCo Redeemable Share, determined pursuant to the Exchange Ratio, and JBS S.A. will become a wholly-owned subsidiary of HoldCo. The HoldCo Redeemable Shares are mandatorily redeemable for JBS N.V. BDRs.

 

   

Redemption. Immediately after the Merger of Shares is approved at the JBS S.A. General Meeting, JBS N.V., as sole shareholder of HoldCo, will approve at the HoldCo General Meeting the redemption of all of the HoldCo Redeemable Shares and deliver to each holder thereof one JBS N.V. BDR for every one HoldCo Redeemable Share held. If such holder wants to receive the underlying JBS N.V. Class A Common Shares, the JBS N.V. BDRs may be cancelled at any time, and from time to time, on or after about two business days after the Closing Date.

 

   

Cash Dividend. Subject to approval at the JBS S.A. General Meeting, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a Cash Dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

 

Exchange Ratio

The Exchange Ratio means the number of HoldCo Redeemable Shares that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) will receive per JBS S.A. Common Share in consideration for the Merger of Shares. The Exchange Ratio has been established so that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) receives, upon completion of the Proposed Transaction, one JBS N.V. BDR for every two JBS S.A. Common Shares that it holds. On the Closing Date, JBS S.A. Shareholders (excluding the controlling shareholders, through

 

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HoldCo) will receive one HoldCo Redeemable Share for every two JBS S.A. Common Shares it holds on the Last Trading Day. Immediately thereafter, each HoldCo Redeemable Share will be redeemed in exchange for one JBS N.V. BDR. Prior to the completion of the Proposed Transaction, our controlling shareholders (through LuxCo) will have received one JBS N.V. Class A Common Share or one JBS N.V. Class B Common Share for every two JBS S.A. Common Shares held. This will result in each JBS S.A. Shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. Shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs as described below, and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.”

 

Opening Price

The opening price of the JBS N.V. BDRs on the B3 will be equivalent to the closing price of the JBS S.A. Common Shares on the Last Trading Day, as adjusted by the Exchange Ratio. We expect that the opening price of the JBS N.V. Class A Common Shares on the NYSE will be determined by buy and sell orders collected by the NYSE from broker-dealers. Based on such orders, the designated market maker will determine an opening price for the JBS N.V. Class A Common Shares. However, prior to the opening trade, there will not be a price at which underwriters initially sell the JBS N.V. Class A Common Shares to the public as there would be in a traditional underwritten initial public offering. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, upon listing on the NYSE, the public trading price of the JBS N.V. Class A Common Shares may be more volatile than in a traditional underwritten initial public offering and could decline significantly and rapidly. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.”

 

Closing Date

On or about                 , 2023.

 

Class A Conversion Period

A period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026, during which each Eligible Shareholder may request, after having cancelled its relevant JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each

 

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JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares, which we refer to as the Maximum Convertible Shares, equals the number of JBS N.V. BDRs to which such Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction).

Except with respect to conversion requests submitted during the Last Conversion Quarter, the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to the Maximum Conversion Rate of 55% of such Eligible Shareholder’s Maximum Convertible Shares. During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the Last Conversion Quarter (i.e., the fourth quarter of 2026), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float of 20%, the number of JBS N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

 

 

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date. For the

 

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avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes.

 

  Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be. For more information, see “The Proposed Transaction—Class A Conversion Period.”

 

Conditions to the Proposed Transaction

The Proposed Transaction is subject to the conditions set forth in “The Proposed Transaction—Conditions Precedent to the Proposed Transaction.”

 

Fractional Shares

Following the Closing Date, any fractional JBS N.V. BDRs attributed to JBS S.A. Shareholders resulting from the Merger of Shares and the Redemption will be grouped into whole numbers and sold on the open market managed by B3, as applicable. The net proceeds from the sale of the fractional JBS N.V. BDRs will be distributed on a pro rata basis to the former JBS S.A. Shareholders who contributed their JBS S.A. Common Shares to HoldCo in the Merger of Shares. Excluding the Cash Dividend, no additional consideration in cash or in kind will be paid to JBS S.A. Shareholders in connection with the Proposed Transaction.

 

Withdrawal

JBS S.A. Shareholders will not have withdrawal rights (direito de recesso) under the Brazilian Corporation Law.

 

Stock Exchange Listings

Currently, there is no public market for JBS N.V. Common Shares. We intend to apply to list the JBS N.V. Class A Common Shares on the NYSE under the symbol “JBS”. We anticipate that trading in JBS N.V.’s Class A Common Shares will begin on or about                     , 2023. We cannot predict the trading prices for JBS N.V.’s Class A Common Shares after the Closing Date. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.”

 

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  We also intend to apply to list the JBS N.V. BDRs on the B3 under the symbol “                ”. We anticipate that trading in JBS N.V.’s BDRs will begin on or about                     , 2023.

 

  We will not seek a listing for the JBS N.V. Class B Common Shares or the JBS N.V. Conversion Shares on the NYSE or on any other exchange.

 

  Upon completion of the Proposed Transaction, the JBS S.A. Common Shares will no longer be listed on B3 or any other exchange. JBS S.A. will become a wholly owned subsidiary of HoldCo.

 

JBS S.A. ADS Program

The JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting. This means that if you hold JBS S.A. ADSs, you will not be entitled to participate in the JBS S.A. General Meeting unless you surrender your JBS S.A. ADSs in accordance with the provisions of the JBS S.A. ADS Deposit Agreement and receive the underlying JBS S.A. Common Shares prior to the date of the JBS S.A. General Meeting.

 

  See “The Proposed Transaction—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

 

U.S. Federal Income Tax Consequences of the Proposed Transaction

See “Taxation—Material U.S. Federal Income Tax Consequences.”

 

Brazilian Tax Consequences of the Proposed Transaction

See “Taxation—Material Brazilian Tax Consequences.”

 

Dutch Tax Consequences of the Proposed Transaction

See “Taxation—Material Dutch Tax Consequences.”

 

Risk Factors

You should review the risks relating to the Proposed Transaction and ownership of the JBS N.V. Common Shares and the JBS N.V. BDRs, our business and industries and the markets in which we operate described in “Risk Factors” in this prospectus.

 

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SUMMARY HISTORICAL FINANCIAL DATA

The following summary historical financial data of JBS S.A.is being provided to help you in your analysis of the financial aspects of the Proposed Transaction. You should read this information in conjunction with this rest of this prospectus, including the sections entitled “Presentation of Financial and Other Information,” “Per Share, Dividend and Market Data,” “Information about JBS S.A.” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” as well as JBS S.A.’s financial statements and the notes thereto included elsewhere in this prospectus.

JBS S.A.

JBS S.A., which is JBS N.V.’s predecessor for accounting purposes, maintains its books and records in Brazilian reais, which is its functional currency. JBS S.A.’s consolidated financial statements included in this prospectus include the financial statements of all of its subsidiaries which are prepared using each subsidiary’s respective functional currency. At the entity level, transactions in foreign currencies other than the functional currency of the entity are initially measured using the exchange rates prevailing at the dates of each transaction. Foreign currency monetary items in the statement of financial position are translated using the closing exchange rate as of the reporting date. Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement at period end of foreign currency monetary assets and liabilities are recognized in the consolidated statement of income, under the captions “Finance income” or “Finance expense.”

JBS S.A.’s consolidated financial statements included in this prospectus are presented in U.S. dollars. JBS S.A. elected to change its presentation currency from the Brazilian real to the U.S. dollar effective January 1, 2022 (which has been retrospectively applied to all periods presented) to facilitate a more direct comparison to other competitors. The translation to the U.S. dollar was performed in two steps: (1) first the financial statements of the subsidiaries with functional currencies different to Brazilian reais were translated into Brazilian reais to produce consolidated financial statements of JBS S.A. in Brazilian reais; and (2) subsequently, the consolidated financial statements of JBS S.A. in Brazilian reais were translated into U.S. dollars. For more information, see “Presentation of Financial and Other Information—Financial Statements—JBS S.A.

The summary historical consolidated financial information of JBS S.A. presented below has been derived from JBS S.A.’s financial statements.

Items Affecting Comparability of Financial Results

The comparability of our financial results is affected by our acquisitions and fluctuations in foreign exchange rates, principally the Brazilian real against the U.S. dollar. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Items Affecting Comparability of Financial Results.”

The summary financial information of JBS S.A. presented in this prospectus is not necessarily indicative of JBS S.A.’s future operating results. The tables below present a summary of JBS S.A.’s financial performance for the periods indicated. The following information should be read and analyzed together with “Presentation of Financial and Other Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and JBS S.A.’s financial statements included elsewhere in this prospectus.

 

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     As of and for the three-month
period ended March 31,
    As of and for the year ended
December 31,
 
     2023     2022     2022     2021     2020 (1)  
                

(in millions of US$)

 

Consolidated statement of income information:

          

Net revenue

     16,687.2       17,364.1       72,613.9       65,042.7       52,331.2  

Cost of sales

     (15,221.5     (14,236.7     (61,070.2     (52,753.8     (43,657.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     1,465.8       3,127.4       11,543.6       12,288.9       8,673.4  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

General and administrative expenses

     (514.2     (606.8     (2,290.0     (2,821.2     (2,075.0

Selling expenses

     (1,111.8     (1,099.6     (4,681.6     (3,551.8     (2,810.8

Other expenses

     (39.1     (22.9     (99.6     (32.6     (63.9

Other income

     81.9       17.7       311.0       100.7       160.0  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net operating expense

     (1,583.1     (1,711.7     (6,760.2     (6,304.8     (4,789.6
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating profit (loss)

     (117.3     1,415.6       4,783.3       5.984.1       3,883.8  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Finance income

     121.6       556.9       808.6       430.7       674.1  

Finance expense

     (420.7     (597.1     (2,050.3     (1,369.2     (3,298.0
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net finance expense

     (299.2     (40.1     (1,241.6     (938.5     (2,623.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Share of profit of equity-accounted investees, net of tax

     2.8       2.9       11.8       17.2       10.4  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Profit (loss) before taxes

     (413.7     1,378.4       3,553.4       5,062.8       1,270.4  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Current income taxes

     (6.7     (372.4     (515.2     (1,402.6     (444.8

Deferred income taxes

     145.2       33.3       105.3       158.5       (189.9
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total income taxes

     138.5       (339.1     (409.9     (1,244.1     (634.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

     (275.2     1,039.3       3,143.5       3,818.6       635.7  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Attributable to:

          

Company shareholders

     (279.6     982.7       2,997.4       3,811.4       623.4  

Non-controlling interest

     4.4       56.7       146.0       7.2       12.3  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
     (275.2     1,039.3       3,143.5       3,818.6       635.7  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated statement of financial position information at period/year end:

          

Cash and cash equivalents

     1,764.5         2,526.4       4,164.3       3,787.0  

Trade accounts receivable

     3,705.5         3,878.1       3,561.9       2,694.3  

Inventories

     5,554.4         5,393.5       4,756.2       3,384.2  

Property, plant and equipment

     12,138.8         11,915.3       10,208.3       9,077.6  

Goodwill

     5,926.7         5,828.6       5,835.4       5,558.5  

Total assets

     39,408.6         39,885.5       37,138.4       31,520.4  

Total loans and financings (2)

     18,248.7         17,700.1       16,578.8       12,682.4  

Total equity

     9,461.5         9,546.1       8,565.0       8,379.2  

Consolidated cash flow information:

          

Net cash flows provided (used in):

          

Operating activities

     (846.9     (107.5     2,580.5       3,998.6       4,419.5  

Investing activities

     (314.7     (556.0     (2,534.1     (3,516.4     (1,482.8

Financing activities

     408.4       148.0       (1,667.4     (64.5     (1,429.5

Other consolidated financial information

          

Adjusted EBITDA (3)

     416.3       1,927.1       6,722.0       8,486.4       5,636.6  

 

(1)

Consolidated statement of financial position information relates to information as of January 1, 2021.

(2)

Current loans and financings plus non-current loans and financings.

 

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(3)

Adjusted EBITDA is used as a measure of performance by our management. Adjusted EBITDA is calculated by making the following adjustments, as further described in this prospectus (see “Summary—Summary Historical Financial Data”), to net income: exclusion of net finance expenses; exclusion of current and deferred income taxes; exclusion of depreciation and amortization expenses; exclusion of share of profit of equity-accounted investees, net of tax; exclusion of expenses with the DOJ and antitrust agreements; exclusion of donations and social programs expenses; exclusion of out of period tax credits impacts; exclusion of JBS fund for the Amazon; exclusion of J&F Leniency expenses refund; and exclusion of certain other income (expenses), net. Adjusted EBITDA is not a measure required by or calculated in accordance with IFRS and should not be considered as a substitute for income from continuing operations, net income or any other measure of financial performance reported in accordance with IFRS or as measures of operating cash flows or liquidity. You should rely primarily on our IFRS financial information, and use Adjusted EBITDA in a supplemental manner in making your investment decision. For more information about the limitations of Adjusted EBITDA, see “Presentation of Financial and Other Information—Non-GAAP Financial Measures.”

Adjusted EBITDA is reconciled to net income (loss) below:

 

     For the
three-month period
ended March 31,
     For the year ended December 31,  
     2023     2022      2022      2021      2020  
                 

(in millions of US$)

 

Net income (loss)

     (275.2     1,039.3        3,143.5        3,818.6        635.7  

Income tax and social contribution taxes – current and deferred

     (138.5)       339.1        409.9        1,244.1        634.7  

Net finance expense

     299.2       40.1        1,241.6        938.5        2,623.9  

Depreciation and amortization

     499.1       465.5        1,907.9        1,673.2        1,519.3  

Share of profit of equity-accounted investees, net of tax

     (2.8)       (2.9)        (11.8      (17.2      (10.4

DOJ and antitrust agreements (a)

     13.7       17.0        101.5        792.7        238.2  

Donations and social programs expenses (b)

     2.7       10.8        22.9        18.3        58.7  

Out of period tax credits impacts (c)

                         (18.8      (78.0

JBS Fund For The Amazon (d)

                  1.1        9.0         

J&F Leniency expenses refund (e)

                  (93.8              

Other operating income (expense), net (f)

     18.0       18.3        (0.9      28.0        14.7  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

     416.3       1,927.1        6,722.0        8,486.4        5,636.6  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA by segment:

             

Brazil

     57.1       83.7        468.9        431.9        577.4  

Seara

     28.3       117.7        896.7        714.7        822.0  

Beef North America

     22.3       785.1        2,081.7        4,511.9        2,161.4  

Pork USA

     44.6       235.6        756.3        786.0        641.6  

Pilgrim’s Pride

     268.7       612.9        2,084.6        1,691.7        1,149.2  

Australia

     (3.4)       85.1        443.9        327.6        275.4  

Others

     (0.7)       7.5        (7.9      24.7        11.8  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total reportable segments

     416.8       1,927.7        6,724.2        8,488.5        5,638.7  

Eliminations (g)

     (0.6)       (0.5)        (2.2      (2.0      (2.1
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted EBITDA

     416.3       1,927.1        6,722.0        8,486.4        5,636.6  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

 

(a)

DOJ and antitrust agreements includes antitrust legal settlements entered into by JBS USA and its subsidiaries and other professional fees (see “Information about JBS S.A.—Legal Proceedings—United States”).

(b)

Donations and social programs include “The Fazer o Bem Faz Bem Social Program,” a program pursuant to which JBS S.A. makes donations to social projects to support the communities where it is present in Brazil.

 

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(c)

Out of period tax credits refer to the recognition of PIS/COFINS tax credits in the ICMS (Brazilian value-added tax on sales and services) tax base.

(d)

The JBS Fund for The Amazon is a fund established by JBS S.A. to finance and support innovative, long-term initiatives that build on JBS S.A.’s legacy of conservation and sustainable development in the Amazon Biome.

(e)

J&F Leniency expenses refund refers to the amount that J&F agreed to pay to JBS in connection with the settlement agreement between the parties to Arbitration Proceeding No. 186/21. For more information, see “Information about JBS S.A.—Legal Proceedings—Brazil—Corporate Lawsuits—Arbitration Proceedings.”

(f)

Refers to several adjustments such as third-party advisory expenses related to restructuring projects and marketing of social programs, among others.

(g)

Includes intercompany and intersegment transactions.

 

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RISK FACTORS

You should carefully consider the risks described below, together with all of the other information included in this prospectus, before making an investment decision. Our business, financial condition and results of operations could be materially and adversely affected by any of these risks or uncertainties. In that case, the trading prices of the JBS N.V. Class A Common Shares and the JBS N.V. BDRs could decline, and you may lose all or part of your investment. The risks described below are those that we currently believe may materially affect us. Additional risks not presently known to us, or that we currently consider immaterial, may also materially adversely affect us.

For purposes of this section, when we state that a risk, uncertainty or problem may, could or will have an “adverse effect” on us or “adversely affect” us, we mean that the risk, uncertainty or problem could have an adverse effect on our business, financial condition, results of operations, cash flow and/or prospects, and/or the price of the JBS N.V. Class A Common Shares and the JBS N.V. BDRs, except as otherwise indicated. You should view similar expressions in this section as having similar meaning.

Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs

The dual class structure of the JBS N.V. Common Shares has the effect of concentrating voting control with our Class B shareholders and limiting our other shareholders’ ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of JBS N.V. Class A Common Shares may view as beneficial.

JBS N.V.’s share capital consists of JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares and JBS N.V. Conversion Shares. The JBS N.V. Conversion Shares are introduced solely for the purpose of facilitating a conversion of JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares under Dutch law. For more information, see “Description of Share Capital—Share Capital.” Please also refer to the risk factors below entitled “—Our shareholders are not subject to lock-up restrictions and may sell JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs at any time, subject to applicable law,” “—The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares may harm the value and liquidity of the JBS N.V. Class A Common Shares” and “—We may issue additional JBS N.V. Class A Common Shares and/or JBS N.V. Class B Common Shares in the future, which may dilute your interest in JBS N.V.’s share capital and affect the trading price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

JBS N.V. Class B Common Shares are entitled to 10 votes per share and JBS N.V. Class A Common Shares are entitled to one vote per share at a general meeting of shareholders of JBS N.V. We intend to maintain this dual-class structure for the foreseeable future and have not included a ‘sunset’ provision in JBS N.V.’s articles of association, meaning that under JBS N.V.’s articles of association as these will read on the Closing Date, JBS N.V.’s share capital will include JBS N.V. Class B Common Shares for an indefinite period of time.

Assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023, immediately upon completion of the Proposed Transaction, our controlling shareholders will (indirectly, through LuxCo) hold 100% of the then-outstanding JBS N.V. Class B Common Shares and 30.04% of the then-outstanding JBS N.V. Class A Common Shares, representing 85.03% of the aggregate voting power in JBS N.V., which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion

 

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Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. In contrast, the aggregate voting power of our non-controlling shareholders may decrease to as little as 9.49% from the 51.17% voting power in JBS S.A. they held as of June 30, 2023. The exact percentage of the then-outstanding JBS N.V. Shares and aggregate voting power in JBS N.V. that will be held (indirectly) by our controlling and non-controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the percentage of JBS S.A. shares that they hold on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction. Upon completion of the Proposed Transaction, to continue to control the outcome of matters submitted to shareholders for approval (assuming a simple majority is needed to approve such matters), the controlling shareholders must hold approximately 9% of the total number of JBS N.V. Common Shares outstanding (assuming they hold 100% of the JBS N.V. Class B Common Shares outstanding).

As a result of the dual-class share structure, our ultimate controlling shareholders are expected to have control or the ability to control significant corporate activities that require a resolution by shareholders at a general meeting of shareholders pursuant to Dutch law and/or JBS N.V.’s articles of association, including:

 

   

the election, suspension and removal of our board of directors;

 

   

merger, demerger or dissolution of JBS N.V.;

 

   

issuances of JBS N.V. Common Shares or designating the board of directors to issue shares for a specific period not exceeding five years, provided that the prior or simultaneous approval of the group of holders of JBS N.V. Class A Common Shares is required if such resolution to issue shares or designate the board of directors is detrimental to the rights of the holders of JBS N.V. Class A Common Shares;

 

   

limiting or excluding pre-emptive rights upon an issue of JBS N.V. Common Shares or designating the board of directors to limit or exclude pre-emptive rights for a specific period not exceeding five years;

 

   

reducing our issued capital by: (1) reducing the nominal value of shares by amending JBS N.V.’s articles of association; or (2) by cancelling shares which JBS N.V. holds in treasury, provided that the prior or simultaneous approval of a group of holders of a specific class of common shares is required if such resolution is detrimental to the rights of the holders of such class of common shares;

 

   

approving resolutions of our board of directors regarding (a) a significant change in the identity or nature of JBS N.V. or the enterprise, including: (1) the transfer of the enterprise or practically the entire enterprise to a third party; (2) the conclusion or cancellation of any long-lasting cooperation by JBS N.V. or a subsidiary with any other legal person or as a fully liable general partner of a limited partnership or a general partnership, provided that such cooperation or the cancellation thereof is of essential importance to JBS N.V.; and (3) the acquisition or disposal of a participating interest in the capital of a company with a value of at least one-third of the sum of the assets according to the consolidated balance sheet with explanatory notes thereto according to the last adopted annual accounts of JBS N.V., by JBS N.V. or a subsidiary, (b) JBS N.V. entering into a contract, agreement or other instrument, which stipulates that a unilateral and unconditional termination of such contract, agreement or other instrument is subject to (1) a termination notice of at least ninety (90) days, and/or (2) the payment of a penalty, including, but not limited to, fines and take or pay arrangements, (c) JBS N.V. selling uncovered put options and/or call options (i.e. without JBS N.V. holding the asset(s) underlying the option), and (d) the board of directors exercising voting rights with respect to shares held by JBS N.V. in the capital of a subsidiary in respect of such subsidiary entering into a contract, agreement or other instrument, which stipulates that a unilateral and unconditional termination of such contract,

 

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agreement or other instrument is subject to (1) a termination notice of at least ninety (90) days, and/or (2) the payment of a penalty, including, but not limited to, fines and take or pay arrangements;

 

   

amending JBS N.V.’s articles of association;

 

   

distribution of profits which remain after reservation by the board of directors; and

 

   

authorizing the board of directors, on JBS N.V.’s behalf, to repurchase shares in the capital of JBS N.V. against consideration, for a specific period not exceeding 18 months.

The foregoing means that, depending on the number of JBS N.V. Class B Common Shares outstanding, a holder of JBS N.V. Class A Common Shares may have no or no significant voting power at a general meeting of shareholders of JBS N.V.

Consequently, upon completion of the Proposed Transaction, our Class B shareholders will continue to be in a position to exert significant influence over JBS N.V. The interests of our Class B shareholders may differ from the interest of our other shareholders. This concentration of ownership may discourage, delay or prevent a change in control of JBS N.V., including transactions in which holders of the JBS N.V. Class A Common Shares might otherwise receive a premium for their shares. In addition, this concentrated control will limit the ability of holders of the JBS N.V. Class A Common Shares to influence corporate matters that they may view as beneficial. This effect will be exacerbated as a result of the dilution of voting power our non-controlling shareholders will experience as a result of the Proposed Transaction. Moreover, our dual-class structure could materially adversely affect the value and liquidity of the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs, for the reasons described above and as further described in the risk factor below entitled “—The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares may harm the value and liquidity of the JBS N.V. Class A Common Shares.”

Our shareholders are not subject to lock-up restrictions and may sell JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs at any time, subject to applicable law.

Our shareholders will not be subject to any lock-up obligation. If our controlling shareholders or other major shareholders sell a large number of their JBS N.V. Class A Common Shares or JBS N.V. BDRs, the market price of JBS N.V. Class A Common Shares or JBS N.V. BDRs may decline significantly. In addition, to the extent that any JBS N.V. Class A Common Shares and/or JBS N.V Class B Common Shares may be pledged to lenders in support of any financing made to our shareholders, such a pledge could be exercised in the event of a default under such financing and such lender may sell the pledged shares in the market. These sales, or the possibility that these sales may occur, might also make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.

In addition, although the JBS N.V. Class B Common Shares are not and are not expected to be listed on a stock exchange, a holder of JBS N.V. Class B Common Shares may transfer all or substantially all of the JBS N.V. Class B Common Shares held by it, which may result in a change of the composition of the controlling shareholders. Any such change, or the possibility that such change may occur, could materially adversely affect the value and liquidity of the JBS N.V. Class A Common Shares or JBS N.V. BDRs.

Furthermore, each JBS N.V. Class B Common Share may be converted into one JBS N.V. Class A Common Share and one JBS N.V. Conversion Share upon (i) a resolution by the board of directors following delivery of a conversion request to the board of directors, or (ii) automatically upon the enforcement of a security interest over such JBS N.V. Class B Common Share (including, but not limited to, a right of pledge), which results in a transfer of such JBS N.V. Class B Common Share.

If holders of JBS N.V. Class B Common Shares exercise the right to convert their JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares and sell a large number of their JBS N.V. Class A Common Shares, the market price of JBS N.V. Class A Common Shares may decline significantly.

 

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The grant of registration rights to LuxCo may adversely affect the market price of the JBS N.V. Class A Common Shares.

Pursuant to a registration rights agreement that is expected to be entered into with LuxCo concurrently with the closing of the Proposed Transaction, J&F and FIP Formosa (through LuxCo) will be able to demand that we register the JBS N.V. Class A Common Shares that LuxCo will receive in the first step of the Restructuring (including those JBS N.V. Class A Common Shares that LuxCo will hold if it exercises its right to convert the JBS N.V. Class B Common Shares that it will receive in the first step of the Restructuring) and any other JBS N.V. Class A Common Shares acquired from JBS N.V. from time to time by LuxCo. Pursuant to the registration rights agreement, LuxCo shall also have the right to include its JBS N.V. Class A Common Shares in any underwritten offering by JBS N.V. We will bear all expenses incurred in effecting such a registration. The registration and availability of such a significant number of shares for trading in the public market may have an adverse effect on the market price of the JBS N.V. Class A Common Shares (including those JBS N.V. Class A Common Shares underlying JBS N.V. BDRs). For example, if LuxCo exercises its registration rights and sells JBS N.V. Class A Common Shares or is perceived by the market as intending to sell such shares, the market price of the JBS N.V. Class A Common Shares could drop or the volatility in the share price of the JBS N.V. Class A Common Shares could increase significantly. These factors could also make it more difficult for us to raise additional funds through future offerings of JBS N.V. Class A Common Shares or other securities. For more information about the LuxCo registration rights agreement, see “Principal ShareholdersRegistration Rights Agreement with LuxCo.”

There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.

Prior to the Proposed Transaction, there has not been a public market for JBS N.V. Class A Common Shares or JBS N.V. BDRs. If active trading markets do not develop, you may have difficulty selling any of the JBS N.V. Class A Common Shares or JBS N.V. BDRs that you receive as part of the Proposed Transaction. We cannot predict the extent to which investor interest in us will lead to the development of an active trading market on the NYSE or the B3 or otherwise or how liquid that market might become.

As settlement of the Proposed Transaction will occur on B3, a holder of JBS N.V. BDRs that wants to receive JBS N.V. Class A Common Shares must cancel JBS N.V. BDRs so that the underlying JBS N.V. Class A Common Shares can be delivered to its indicated account. It is expected that a significant amount of JBS N.V. Class A Common Shares may be held through JBS N.V. BDRs, which may affect the liquidity and trading price of JBS N.V. Class A Common Shares on the NYSE.

The opening price of the JBS N.V. BDRs on the B3 will be equivalent to the closing price of the JBS S.A. Common Shares on the Last Trading Day, as adjusted by the Exchange Ratio. We cannot assure you that the trading price for JBS N.V. Class A Common Shares will reflect the price of JBS S.A. Common Shares on B3 or that these prices will prevail in the market following the Proposed Transaction. The price of JBS S.A. Common Shares on B3 has been subject to volatility. The trading price of JBS S.A. Common Shares in 2022 reached a high for the year of R$39.03 per share on April 27, 2022 and a low of R$20.24 per share on December 24, 2022. The trading price of JBS S.A. Common Shares on June 30, 2023 was R$17.46 per share.

The listing of the JBS N.V. Class A Common Shares on the NYSE is a process that is not a traditional underwritten initial public offering. There will be no book building process and no price at which underwriters initially sell shares to the public to help inform efficient and sufficient price discovery with respect to the opening trades on the NYSE. We expect that the opening price of the JBS N.V. Class A Common Shares on the NYSE will be determined by buy and sell orders collected by the NYSE from broker-dealers. Based on such orders, the designated market maker will determine an opening price for the JBS N.V. Class A Common Shares. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, upon listing on the NYSE, the public trading price of the

 

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JBS N.V. Class A Common Shares may be more volatile than in a traditional underwritten initial public offering and could decline significantly and rapidly.

Further, because of our listing process, individual investors may have greater influence in setting the opening public trading price and subsequent public trading prices of the JBS N.V. Class A Common Shares on the NYSE and may participate more in our initial and subsequent trading, leading to an increased amount of smaller orders at numerous prices, for example, than is typical for a traditional underwritten initial public offering with more institutional investor influence. These factors could result in more volatility in the public trading price of the JBS N.V. Class A Common Shares and an unsustainable trading price if the price of the JBS N.V. Class A Common Shares significantly rises upon listing and institutional investors believe the JBS N.V. Class A Common Shares is worth less than retail investors, in which case the price of the JBS N.V. Class A Common Shares may decline over time. Further, if the public trading price of the JBS N.V. Class A Common Shares is above the level that investors determine is reasonable for the JBS N.V. Class A Common Shares, some investors may attempt to short the JBS N.V. Class A Common Shares after trading begins, which would create additional downward pressure on the public trading price of the JBS N.V. Class A Common Shares. There will likely be more ability for such investors to short the JBS N.V. Class A Common Shares in early trading than is typical for a traditional underwritten public offering given increased availability of the JBS N.V. Class A Common Shares on the trading markets in part due to the lack of contractual lock-up agreements or other restrictions on transfer. To the extent that there is a lack of awareness among retail investors, such lack of awareness could reduce the value of the JBS N.V. Class A Common Shares and cause volatility in the public trading price of the JBS N.V. Class A Common Shares.

Moreover, due to the timing differences in the commencement of trading of the JBS N.V. BDRs on the B3 and JBS N.V. Class A Common Shares on the NYSE, investors will not be able to sell or otherwise trade shares on the NYSE during the period between the initial pricing and the commencement of the trading of the JBS N.V. BDRs on the B3 and the subsequent commencement of trading of the JBS N.V. Class A Common Shares on the NYSE, and will be subject to the risk that the trading prices of the JBS N.V. BDRs may fall before the JBS N.V. Class A Common Shares commence trading on the NYSE.

In addition, the market price of the JBS N.V. Class A Common Shares and/or JBS N.V. BDRs may be influenced by many factors, some of which are beyond our control, including:

 

   

announcements by us or our competitors of significant contracts or acquisitions;

 

   

technological innovations by us or competitors;

 

   

the failure of financial analysts to cover JBS N.V. Class A Common Shares or JBS N.V. BDRs after the Proposed Transaction or changes in financial estimates by analysts;

 

   

actual or anticipated variations in our results of operations;

 

   

changes in financial estimates by financial analysts, or any failure by us to meet or exceed any of these estimates, or changes in the recommendations of any financial analysts that elect to follow JBS N.V. Class A Common Shares, JBS N.V. BDRs or the shares of our competitors;

 

   

announcements by us or our competitors of significant contracts or acquisitions;

 

   

adverse news relating to us and our business, our executives and key business partners or suppliers;

 

   

future sales of our shares; and

 

   

investor perceptions of us and the industries in which we operate.

Finally, the global stock market in general has experienced substantial price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of particular companies affected. These broad market and industry factors may materially harm the market price of JBS N.V. Class A Common Shares and JBS N.V. BDRs. In the past, following periods of volatility in the market price of certain companies’ securities, securities class action litigation has been instituted against these companies. This litigation, if

 

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instituted against us, could adversely affect our financial condition or results of operations. If a market does not develop or is not maintained, the liquidity and price of JBS N.V. Class A Common Shares and JBS N.V. BDRs could be seriously harmed.

The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares may harm the value and liquidity of the JBS N.V. Class A Common Shares.

The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares could harm the value of the JBS N.V. Class A Common Shares to the extent that any investor or potential future purchaser of the JBS N.V. Class A Common Shares ascribes value to the right of holders of the JBS N.V. Class B Common Shares to 10 votes per JBS N.V. Class B Common Share. The existence of two classes of common shares could also result in less liquidity for the JBS N.V. Class A Common Shares than if there were only one class of common shares.

In addition, our dual-class structure may result in a lower or more volatile market price of the JBS N.V. Class A Common Shares and the JBS N.V. BDRs or in adverse publicity or other adverse consequences. For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indexes. S&P Dow Jones and FTSE Russell have announced changes to their eligibility criteria for inclusion of shares of public companies on certain indices, including the S&P 500. These changes exclude companies with multiple classes of shares of common stock from being added to these indices. In addition, several stockholder advisory firms have announced their opposition to the use of dual-class structures. As a result, our dual-class structure may prevent the inclusion of the JBS N.V. Class A Common Shares in these indices and may cause stockholder advisory firms to publish negative commentary about our corporate governance practices or otherwise seek to cause us to change our capital structure. Any such exclusion from indices could result in a less active trading market for the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs. Any actions or publications by stockholder advisory firms critical of our corporate governance practices or capital structure could also adversely affect the value of the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs.

The conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period may harm the liquidity of the JBS N.V. Class A Common Shares.

During the Class A Conversion Period, each Eligible Shareholder may request, after having cancelled its relevant JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held, subject to the Minimum Free Float requirement. For more information, see “The Proposed Transaction—Class A Conversion Period.”

Despite the Minimum Free Float requirement, if Eligible Shareholders exercise the right to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, the liquidity of JBS N.V. Class A Common Shares may be significantly harmed.

If you request to convert JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you will hold shares that do not trade on a market, and you may not be able to convert your JBS NV. Class B Common Shares into JBS N.V. Class A Shares in a timely manner.

We will not seek a listing for the JBS N.V. Class B Common Shares on the NYSE or on any other exchange. If you are an Eligible Shareholder and validly request to have your JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares during the Conversion Period, you will not hold a class of common shares that will trade on a liquid market.

If you wish to convert your JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares you will need to comply with the procedures established in our articles of association. For example, you may need to

 

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deliver a conversion request to our board of directors. See “Description of Share Capital—Conversion” for more information. After delivering such conversion request, we cannot guarantee that your JBS N.V. Class B Common Shares will be converted into JBS N.V. Class A Common Shares in a timely manner or that the market price of the JBS N.V. Class A Common Shares will not be different at the time of such conversion. As such, the price of the JBS N.V. Class A Common Shares may vary substantially between the time you request to convert your JBS N.V. Class B Common Shares and the time your JBS N.V. Class B Common Shares are converted into JBS N.V. Class A Common Shares.

In addition, if you submit a request to convert JBS N.V. Class A Common Shares to JBS N.V. Class B Common Shares, you will be subject to your undertaking not to transfer the JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains. For more information about the procedure for requesting a conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, see “The Proposed Transaction—Class A Conversion Period.”

Following the completion of the Proposed Transaction and the Class A Conversion Period, our controlling shareholders’ aggregate voting power in JBS N.V. may increase significantly.

Our controlling shareholders will, upon completion of the Proposed Transaction, own (indirectly, through LuxCo) 100% of the issued and outstanding JBS N.V. Class B Common Shares and 30.04% of the issued and outstanding JBS N.V. Class A Common Shares, which will represent 85.03% of the aggregate voting power in JBS N.V. (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023), which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, our controlling shareholders’ voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. See “—The dual class structure of the JBS N.V. Common Shares has the effect of concentrating voting control with our Class B shareholders and limiting our other shareholders’ ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of JBS N.V. Class A Common Shares may view as beneficial.”

We cannot estimate how many Eligible Shareholders will opt to request a conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period or reconvert into JBS N.V. Class A Common Shares thereafter. Eligible Shareholders must decide whether to request conversion of their JBS N.V. Class A Common Shares or reconvert into JBS N.V. Class A Common Shares thereafter based on their individual preferences and circumstances, which we cannot predict. Certain legal entities may also be limited in their ability to hold JBS N.V. Class B Common Shares due to the fact that the JBS N.V. Class B Common Shares will not be listed on the NYSE or on any other exchange.

You may experience delays in the conversion of your JBS N.V. Class A Common Shares during the Class A Conversion Period.

The ability to convert JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares will be a one-time process open solely to our controlling shareholders and holders of one or more JBS N.V. BDRs at the

 

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opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date and for a limited period of time. If you are an Eligible Shareholder who wishes to exercise your right to convert your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you will be required to follow certain procedures as described in “The Proposed Transaction—Class A Conversion Period,” including providing a conversion request and supporting documentation. This request will require you to provide an undertaking to not transfer the JBS N.V. Class A Common Shares to which such request pertains, from the date on which such request is provided to the board of directors until (and including) the day on which the JBS N.V. Class A Common Shares to which such request pertains are converted into JBS N.V. Class B Common Shares. In addition, in order to convert your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, you must first cancel the JBS N.V. BDRs you received in connection with the Proposed Transaction and receive the underlying JBS N.V. Class A Common Shares. These procedures may be cumbersome and time consuming and delay the conversion of your JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares and your ability to timely vote such shares. See “The Proposed Transaction—Receiving JBS N.V. Class A Common Shares.”

Our controlling shareholders (through LuxCo) and our non-controlling shareholders will be treated differently during the Class A Conversion Period.

Eligible Shareholders are subject to limitations on the number of JBS N.V. Class A Common Shares they may convert during the Class A Conversion Period, whereas LuxCo is not subject to such limitations, with the effect of maintaining a specified minimum percentage of voting control by LuxCo. For more information about these limitations, see “The Proposed Transaction—Class A Conversion Period.” In the event that all Eligible Shareholders and LuxCo request to convert 100% of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, our controlling shareholders’ voting power will be increased from 48.83% to 59.55% due to the Minimum Free Float limitation applicable to Eligible Shareholders only. For more information about our corporate structure immediately following the Class A Conversion Period considering various conversion scenarios, see “The Proposed Transaction—Class A Conversion Period.” Furthermore, during the Class A Conversion Period, our board of directors will resolve on any conversion requests received from LuxCo within          business days of receiving such request. However, in the case of requests received from Eligible Shareholders, our board of directors will only resolve on such requests          business days following the end of the fiscal quarter in which they are made.

JBS S.A. may incur debt to pay the Cash Dividend. Repayment of this debt may be made with proceeds of future equity offerings of JBS N.V., which may adversely impact the value of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

JBS S.A. may incur debt to finance a portion of the Cash Dividend. The incurrence of debt by us in connection with or in advance of completion of the Proposed Transaction will not result in adjustments to the Exchange Ratio, and may impact the value of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs that you receive in connection with the Proposed Transaction. After the Closing Date, JBS S.A. will be a wholly owned subsidiary of JBS N.V., and JBS N.V. may use funds received from JBS S.A. (as dividend, interest on shareholders’ equity or capital reduction) to repay debt. This may prevent distributions or reduce cash available for distributions to shareholders of JBS N.V. Using funds from JBS S.A. or incurring debt may adversely affect our financial condition, JBS S.A.’s capitalization, and our ability to implement our business plan after the completion of the Proposed Transaction. We may issue equity securities in the future and use the proceeds to repay debt incurred. Future equity issuances or conversion of outstanding debt securities into JBS N.V. Class A Common Shares may result in your dilution and impact the value of JBS N.V. Class A Common Shares or JBS N.V. BDRs.

We may issue additional JBS N.V. Class A Common Shares and/or JBS N.V. Class B Common Shares in the future, which may dilute your interest in JBS N.V.’s share capital and affect the trading price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

We may issue additional JBS N.V. Class A Common Shares and/or JBS N.V. Class B Common Shares in the future (or voluntarily or mandatorily convert JBS N.V. Class B Common Shares into JBS N.V. Class A

 

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Common Shares), which may result in a dilution of your interest in JBS N.V.’s share capital and affect the trading price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs. Under Dutch law, each JBS N.V. shareholder has pre-emptive rights on any issue of shares pro rata to the aggregate nominal value of his shares, except inter alia if shares are issued for a non-cash contribution, if shares are issued to employees or if shares are issued to persons exercising a previously granted right to subscribe for shares. The general meeting of shareholders is in principle authorized to limit or exclude pre-emptive rights or to delegate such authority to the board of directors. See “Description of Share Capital—Additional Issuances and Pre-Emptive Rights” for additional information. We may raise funds to grow our business and implement our growth strategy through public or private issuances of common shares or securities convertible into, or exchangeable for, JBS N.V. Common Shares, which may dilute your interest in JBS N.V.’s share capital or result in a decrease in the market price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs. In addition, we may also enter into mergers or other similar transactions in the future, which may dilute your interest in JBS N.V.’s share capital or result in a decrease in the market price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs. Any fundraising through the issuance of shares or securities convertible into or exchangeable for shares, the optional or mandatory conversion of JBS N.V. Class B Common Shares or the participation in corporate transactions with an effect similar to a merger, may dilute your interest in JBS N.V.’s share capital or result in a decrease in the market price of JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about us or our businesses, the price and trading volume of the JBS N.V. Class A Common Shares and JBS N.V. BDRs could decline.

The trading market for the JBS N.V. Class A Common Shares and the JBS N.V. BDRs will depend in part on the research and reports that securities or industry analysts publish about us or our businesses. While securities and industry analysts currently cover JBS S.A., securities and industry analysts do not currently cover JBS N.V., and may never publish research on us. If no securities or industry analysts commence coverage of us, the trading price for the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrade our securities or publish inaccurate or unfavorable research about our businesses, the price of the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, demand for the JBS N.V. Class A Common Shares and/or the JBS N.V. BDRs could decrease, which might cause the price and trading volume of the JBS N.V. Class A Common Shares and/or JBS N.V. BDRs to decline.

The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.

Although, as described under “JBS S.A. General Meeting—Required Vote,” the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. A majority of the JBS S.A. Free Float Outstanding represents approximately 25% of the total issued and outstanding JBS S.A. Common Shares as of June 30, 2023. However, since certain matters being voted on at the JBS S.A. General Meeting (such as the Merger of Shares) must be approved by a majority of the outstanding JBS S.A. Common Shares, it is possible that the Proposed Transaction may be approved by non-controlling shareholders representing as little as 1.2% of the total JBS S.A. Common Shares issued and outstanding (which combined with the 48.83% of the issued and outstanding JBS S.A. Common Shares held by our controlling shareholders as of June 30, 2023 amount to a majority of the of the JBS S.A. Common Shares outstanding). If non-controlling shareholders of JBS S.A. do not attend the JBS S.A. General Meeting, they may have no significant power to decide on the Proposed Transaction.

 

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Failure to conclude the Proposed Transaction after approval at the JBS S.A. General Meeting may adversely affect the market price of JBS S.A. Common Shares.

The completion of the Proposed Transaction is subject to the approval of JBS S.A. Shareholders at the JBS S.A. General Meeting where holders representing at least 25% of JBS S.A.’s issued and outstanding voting capital must be present in person, represented by a proxy in accordance with Brazilian corporate law at the meeting or have submitted remote voting ballots (boletim de voto à distância). The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as described under the caption “JBS S.A. General MeetingAgenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares. The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting. In addition, holders of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting must approve the Delisting. For more information about the percentage of shareholders required to approve each matter being voted upon at the JBS S.A. General Meeting, see “JBS S.A. General Meeting—Required Vote.” Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. See “—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders” above. Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters. In addition, if no non-controlling shareholders attend the JBS S.A. General Meeting, the meeting will not be held even though the shares held by our controlling shareholders will be sufficient to establish a quorum because, as described above, the Proposed Transaction cannot be approved without participation by non-controlling shareholders.

Completion of the Proposed Transaction is also subject to certain additional conditions, none of which may be waived. See “The Proposed Transaction—Conditions Precedent to the Proposed Transaction.” There is no assurance that the Proposed Transaction will be completed on the terms or timeline currently contemplated, or at all. Failure to conclude the Proposed Transaction after its approval at the JBS S.A. General Meeting may adversely affect the market price of JBS S.A. Common Shares.

In addition, we have expended and will continue to expend significant management time and resources and have incurred and will continue to incur significant expenses due to legal, advisory and accounting services fees related to the Proposed Transaction. These expenses must be paid regardless of whether the Transaction is completed.

The termination of the JBS S.A. ADS Program may adversely affect us and our security holders.

The JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting. This means that if you hold JBS S.A. ADSs, you will not be entitled to participate in the JBS S.A. General Meeting unless you surrender your JBS S.A. ADSs in accordance with the provisions of the JBS S.A. ADS Deposit Agreement and receive the underlying JBS S.A. Common Shares prior to the date of the JBS S.A. General Meeting. JBS S.A. ADS Holders who are unable to hold JBS S.A. Common Shares in Brazil will be unable to participate in the JBS S.A. General Meeting or receive JBS N.V. securities in the form of JBS N.V. BDRs or JBS N.V. Class A Common Shares. See “The Proposed Transaction—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

 

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As a result of the termination of the JBS S.A. ADS Program, if the Proposed Transaction does not occur, the JBS Group’s securities will neither be traded on a U.S. exchange (through the listing of the JBS N.V. Class A Common Shares on the NYSE) nor quoted on an over-the-counter market in the United States. If this were to occur, JBS S.A. ADS Holders could face significant adverse consequences, including reduced liquidity for their securities or, if they are unable to hold JBS S.A. Common Shares in Brazil, the lack of ability to invest in our company. In addition, if we are unable to list our securities on a U.S. exchange, the potential market for investors in the JBS Group could be significantly reduced. See also “—Failure to conclude the Proposed Transaction after approval at JBS S.A. General Meeting may adversely affect the market price of JBS S.A. Common Shares” above.

JBS S.A. could be subject to potential litigation relating to the Proposed Transaction that could delay the Proposed Transaction and/or result in significant costs and expenses.

JBS S.A. could be subject to potential litigation relating to the Proposed Transaction that could delay the Proposed Transaction and/or result in significant costs and expenses. In Brazil, for example, shareholder litigation often follows certain significant business transactions, such as the Proposed Transaction. The Proposed Transaction may become involved in this type of litigation in the future. Litigation is often expensive and diverts management’s attention and resources, which could adversely affect or delay the completion of the Proposed Transaction and/or result in significant costs and expenses.

Anti-takeover provisions in JBS N.V.’s articles of association could deter potential acquirers and make an acquisition of us difficult, limit attempts by our shareholders to replace or remove our current directors and management team, and limit the market price of our common shares.

The European Directive on Takeover Bids (2004/25/EC) has been implemented in Dutch legislation but applies only to companies whose shares are admitted to listing and trading on an EU regulated market. Given that the JBS N.V. Class A Common Shares shall only be admitted to listing and trading on the NYSE, these provisions are not applicable.

JBS N.V.’s articles of association contain provisions that, although they do not make us immune from takeovers, may delay or prevent a change of control, discourage bids at a premium over the market price of JBS N.V. Common Shares and adversely affect the market price of JBS N.V. Common Shares and the voting and other rights of its shareholders. These provisions include:

 

   

provisions establishing a dual class share structure, not taking into consideration the JBS N.V. Conversion Shares, which, for so long the JBS N.V. Class B Common Shares are issued and outstanding, will allow the holders of JBS N.V. Class B Common Shares to control the outcome of most corporate matters requiring shareholder approval, to the extent these resolutions do not require a qualified majority, even if the number of JBS N.V. Class B Common Shares represent significantly less than a majority of the number of issued and outstanding JBS N.V. Common Shares. As a result, the holders of JBS N.V. Class B Common Shares could delay or prevent the approval of a change of control transaction that may otherwise be approved by the holders of our issued and outstanding JBS N.V. Class A Common Shares;

 

   

automatic conversion of JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares upon the enforcement of a security interest over such JBS N.V. Class B Common Shares (including, but not limited to, a right of pledge), which results in a transfer of such JBS N.V. Class B Common Shares; and

 

   

minimum shareholding thresholds, based on nominal value, for shareholders to call general meetings or to add items to the agenda for those meetings.

These provisions may be applied even if an offer may be considered beneficial by some shareholders. In addition, these provisions may frustrate or prevent any attempts by our shareholders to replace or remove our current management team by making it more difficult for shareholders to replace members of our board of directors, which is responsible for appointing the members of our management.

 

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As a holding company, our operating results, financial condition and ability to pay dividends or other distributions are entirely dependent on dividends and other distributions received from our subsidiaries.

As a holding company, our operating results and financial condition are entirely dependent on the performance of our operating subsidiaries. Additionally, our ability to pay dividends or other distributions in the future will depend on the level of dividends and other distributions, if any, received from our operating subsidiaries. The ability of our operating companies to make loans or distributions (directly or indirectly) to us may, from time to time, be restricted as a result of several factors, including restrictions in financing agreements, capital controls or other foreign exchange limitations, the requirements of applicable law (including Dutch law) and regulatory and fiscal or other restrictions (including, for example, the application of a dividend withholding tax and the ability to use any double tax treaty to mitigate such tax) in the jurisdictions in which our subsidiaries operate or if such operating subsidiaries were unable to make loans or distributions to us either directly or indirectly. If earnings and cash flow from operating subsidiaries were substantially reduced for a sufficient length of time, we may not be in a position in the longer term to make distributions to our shareholders in line with any future announced proposals or at all. We can only declare dividends out of the profits as determined following the adoption of the annual accounts by the general meeting of shareholders, or the freely distributable reserves available to us as determined in accordance with Dutch law.

Our ability to make dividend payments is subject to, inter alia, our future financial performance and cash flow position and by limitations under our debt agreements and Dutch law. Investors may not be able to rely on dividends to receive a return on their investment.

Although we currently expect to pay a regular annual dividend following the closing of the Proposed Transaction, any such determination to pay dividends will be at the discretion of the general meeting of shareholders and board of directors. Following the adoption of the annual accounts by the general meeting of shareholders, our board of directors may determine which part of the profits shall be reserved. The general meeting of shareholders may resolve that the part of the profits remaining after reservation shall be distributed as a dividend on the JBS N.V. Shares; without such resolution, these profits shall also be reserved. Our board of directors may, without shareholder approval but subject to certain conditions, also resolve to distribute an interim dividend on JBS N.V. Shares and/or to make a distribution from the reserves.

In addition, any such determination to pay dividends will also be dependent on then-existing conditions, including our financial condition, earnings, legal requirements, including limitations under Dutch law, restrictions in our debt agreements that limit our ability to pay dividends to shareholders and other factors our board of directors deems relevant. For example, pursuant to the Dutch Civil Code, JBS N.V. may only make distributions to its shareholders to the extent its equity exceeds the sum of the paid-in and called-up issued capital plus the reserves as required to be maintained by Dutch law.

For these reasons, you will not be able to rely on dividends to receive a return on your investment. Accordingly, realization of a gain on the JBS N.V. Class A Common Shares or JBS N.V. BDRs you receive in the distribution may depend on the appreciation of the price of the JBS N.V. Class A Common Shares or the JBS N.V. BDRs, as the case may be, which appreciation may never occur. Moreover, any determination to pay dividends in the future would be subject to compliance with applicable laws, including the Dutch Civil Code.

Any shareholder whose principal currency is not the U.S. dollar will be subject to exchange rate fluctuations.

The JBS N.V. Class A Common Shares will be traded in, and any cash dividends or other distributions to be declared in respect of them, if any, will be denominated, in U.S. dollars. Shareholders whose principal currency is not the U.S. dollar will be exposed to foreign currency exchange rate risk. Any depreciation of the U.S. dollar in relation to such foreign currency would reduce the value of the JBS N.V. Class A Common Shares held by such shareholders, whereas any appreciation of the U.S. dollar would increase their value in foreign currency terms. In addition, we will not offer our shareholders the option to elect to receive dividends, if any, in any other currency. Consequently, our shareholders may be required to arrange their own foreign currency exchange, either through a brokerage house or otherwise, which could incur additional commissions or expenses.

 

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Following the Proposed Transaction JBS N.V. will become a U.S. public reporting company subject to U.S. financial reporting rules and regulations and other requirements of the SEC. Our accounting and other management systems and resources may not be immediately prepared to meet these requirements, which may strain our resources.

Following the Proposed Transaction, JBS N.V. will become a public reporting company in the United States and Brazil and will be subject to reporting, disclosure control and other applicable obligations under the Exchange Act, the Sarbanes-Oxley Act (“SOX”), and the Dodd-Frank Act, as well as rules adopted, and to be adopted, by the SEC, the NYSE, the CVM and the B3.

As a result, we will incur higher legal, accounting and other expenses than before, and these expenses may increase even more in the future. For example, Section 404 of SOX requires annual management assessment of the effectiveness of internal controls over financial reporting and a report by our independent registered public accounting firm addressing these assessments, subject to phase-in accommodations for newly listed companies. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives, which we are in the process of developing and implementing while at the same time remaining focused on our existing operations. If we are unable to implement our compliance initiatives in a timely and effective fashion, our ability to comply with the financial reporting requirements and other rules that apply to reporting companies could be impaired.

In addition, we cannot assure you that there will not be material weaknesses or significant deficiencies in our internal control over financial reporting in the future. Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our cash flows, results of operations or financial condition. If we are unable to conclude that our internal controls over financial reporting are effective, or if our independent registered public accounting firm determines we have a material weakness in our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, the market price of our common shares could decline, and we could be subject to sanctions or investigations by the NYSE, the SEC or other regulatory authorities. Failure to remedy any material weakness in our internal controls over financial reporting, or to implement or maintain other effective control systems required of public companies in the United States, could also restrict our future access to capital markets and reduce or eliminate the trading market for our common shares.

We are a “foreign private issuer” under U.S. securities laws and, as a result, are subject to disclosure obligations that are different from those applicable to U.S. domestic registrants listed on the NYSE.

As a foreign private issuer, we will be exempt from a number of requirements under U.S. securities laws that apply to public companies that are not foreign private issuers. In particular, we will be exempt from the rules and regulations under the Exchange Act, related to the furnishing and content of proxy statements, and our officers, directors and principal shareholders will be exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file annual and current reports and financial statements with the SEC as frequently or as promptly as U.S. domestic companies whose securities are registered under the Exchange Act and we will generally be exempt from filing quarterly reports with the SEC under the Exchange Act. We will also be exempt from the provisions of Regulation FD, which prohibits the selective disclosure of material nonpublic information to, among others, broker-dealers and holders of a company’s securities under circumstances in which it is reasonably foreseeable that the holder will trade in such company’s securities on the basis of the information. These exemptions and leniencies will reduce the frequency and scope of information and protections to which you are entitled as an investor.

In order to maintain our current status as a foreign private issuer, either (a) more than 50% of our outstanding voting securities must be directly or indirectly owned of record by non-residents of the United States or (b)(1) a majority of our executive officers or directors may not be U.S. citizens or residents, (2) more than

 

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50% of our assets cannot be located in the United States and (3) our business must be administered principally outside the United States. Following the completion of this offering or at some other time thereafter, U.S. residents may directly or indirectly own more than 50% of our outstanding voting securities. If so, we will cease to qualify as a foreign private issuer if we do not meet the requirements set forth in (b) above.

Although we have elected to comply with certain U.S. regulatory provisions, our loss of foreign private issuer status would make such provisions mandatory. The regulatory and compliance costs to us under U.S. securities laws as a U.S. domestic issuer would be significantly higher. If we are not a foreign private issuer, we will be required to file periodic reports and registration statements on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer. We would also be required to follow U.S. proxy disclosure requirements. We may also be required to modify certain of our policies to comply with good governance practices associated with U.S. domestic issuers. Such conversion and modifications will involve additional costs. In addition, we would lose our ability to rely upon exemptions from certain corporate governance requirements on U.S. stock exchanges that are available to foreign private issuers.

As a foreign private issuer, we are permitted to follow certain home country corporate governance practices instead of otherwise applicable NYSE requirements.

As a foreign private issuer, we are permitted to follow certain home country corporate governance practices instead of those otherwise required under the NYSE rules for domestic U.S. issuers, provided that we disclose any significant ways in which our corporate governance practices differ from those followed by domestic companies under NYSE listing standards. For example, foreign private issuers are permitted to follow home country practice with regard to director nomination procedures and the approval of compensation of officers. See “Description of Share Capital—Comparison of Dutch Corporate Law and U.S. Corporate Law” for more information on the significant differences between our corporate governance practices and those followed by domestic U.S. issuers.

As a result of our reliance on the corporate governance exemptions available to foreign private issuers under NYSE rules, you will not have the same protection afforded to shareholders of companies that are subject to all of the NYSE’s corporate governance requirements. We may also be a “controlled company” within the meaning of the corporate governance standards of the NYSE. If we were to lose our foreign private issuer status but remain a controlled company, we may rely on the “controlled company” exemption under NYSE corporate governance rules. See “Management—Corporate Governance Practices” for more information.

Availing ourselves of any of these exemptions, as opposed to complying with the requirements that are applicable to a U.S. domestic registrant, may provide less protection to you than is accorded to investors under the NYSE’s corporate governance rules. Therefore, any foreign private issuer or “controlled company” exemptions we avail ourselves of in the future may reduce the scope of information and protection to which you are otherwise entitled as an investor.

We are incorporated under and subject to Dutch law, which may afford less protection to our shareholders than U.S. laws.

Our corporate affairs are governed by JBS N.V.’s articles of association and Dutch law. Dutch law may afford less protection to our shareholders than U.S. laws and may differ in some material respects from laws generally applicable to U.S. companies and shareholders, including the provisions relating to interested directors, mergers, amalgamations and acquisitions, takeovers, shareholder lawsuits and indemnification of directors. There may be less publicly available information about us than is regularly published by or about U.S. companies. Dutch law governing the shares of Dutch companies may not be as extensive as those in effect in the United States, and Dutch law and regulations in respect of corporate governance matters might not be as protective of minority shareholders as state corporation laws in the United States. Therefore, our shareholders may have more difficulty in protecting their interests in connection with actions taken by our directors and officers or our principal shareholders than they would as shareholders of a corporation incorporated in the United States. See

 

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Description of Share Capital.” For example, neither JBS N.V.’s articles of association nor Dutch law provides for appraisal rights for dissenting shareholders in certain extraordinary corporate transactions that may otherwise be available to shareholders under certain U.S. state laws.

All our general meetings of shareholders shall take place in Amsterdam or Haarlemmermeer (Schiphol Airport), the Netherlands. Shareholders may vote by proxy or in person at any general meeting of shareholders.

The ability of shareholders to effect service of process or enforce civil liabilities under U.S. securities laws may be limited.

At the date of listing of the JBS N.V. Class A Common Shares, JBS N.V. will be a public limited liability company (naamloze vennootschap) under Dutch law and some of its directors and executive officers are (at that time) residents of countries other than the United States. A portion of our assets and the assets of some of its directors and executive officers are located outside the United States. As a result, it may not be possible for investors in the JBS N.V. Class A Common Shares to effect service of process within the United States upon such persons or upon us or to enforce in U.S. courts or outside the United States judgments obtained against such persons or against us. In addition, it may be difficult for investors to enforce, in original actions brought in courts in jurisdictions located outside the United States, liabilities predicated upon the civil liability provisions of U.S. securities laws and there is substantial doubt as to the enforceability, in the Netherlands, of original actions or actions for enforcement based on the federal securities laws of the United States or judgments of U.S. courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States.

The United States and the Netherlands do not currently have a treaty providing for reciprocal recognition and enforcement of judgments, other than arbitration awards, in civil and commercial matters. Accordingly, a final judgment for the payment of money rendered by U.S. courts based on civil liability, whether or not predicated solely upon the U.S. federal securities laws, would not be directly enforceable in the Netherlands. However, if the party in whose favor such final judgment is rendered brings a new suit in a competent court in the Netherlands, that party may submit to the Dutch court the final judgment that has been rendered in the United States. A judgment by a federal or state court in the United States against us will neither be recognized nor enforced by a Dutch court but such judgment may serve as evidence in a similar action in a Dutch court. Additionally, based on Dutch Supreme Court case law, a Dutch court will generally grant the same judgment without a review of the merits of the underlying claim if that judgment: (1) resulted from legal proceedings compatible with Dutch notions of due process; (2) does not contravene public policy of the Netherlands; (3) was a decision of a court that has accepted its judgment on internationally accepted principles of private international law; and (4) is not incompatible with (a) a prior judgment of a Dutch court rendered in a dispute between the same parties, or (b) a prior judgment of a foreign court rendered in a dispute between the same parties, concerning the same subject matter and based on the same cause of action, provided that the prior judgment qualifies for recognition in the Netherlands.

Judgments of Brazilian courts to enforce our obligations with respect to JBS N.V. Class A Common Shares or JBS N.V. BDRs may be payable only in Brazilian reais.

If proceedings are brought in the courts of Brazil seeking to enforce our obligations in respect of JBS N.V. Class A Common Shares or JBS N.V. BDRs, we may not be required to discharge our obligations in a currency other than the Brazilian real. Under Brazilian exchange control laws, an obligation in Brazil to pay amounts denominated in a currency other than the Brazilian real may only be satisfied in Brazilian currency at the exchange rate, typically as determined by the Brazilian Central Bank, in effect on the date the judgment is obtained, and such amounts are then typically adjusted to reflect exchange rate variations and monetary restatements through the effective payment date. The then-prevailing exchange rate may not afford non- Brazilian investors with full compensation for any claim arising out of or related to our obligations under the JBS N.V. Class A Common Shares or JBS N.V. BDRs.

 

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If the Merger of Shares and Redemption do not qualify as a nonrecognition transaction, U.S. holders of JBS S.A. Common Shares may incur a substantially greater U.S. federal income tax liability as a result of the Proposed Transaction.

The Merger of Shares and Redemption, when taken together with certain other steps of the Restructuring, are expected to be treated as part of an integrated transaction qualifying as a nonrecognition transaction for U.S. federal income tax purposes. As discussed further in the section entitled “Material U.S. Federal Income Tax Consequences—Consequences of the Merger of Shares and Redemption”, however, this treatment is not clear under the U.S. federal income tax rules and it is not certain whether the Merger of Shares and the Redemption qualify for such tax treatment.

If the Merger of Shares and Redemption qualify as a nonrecognition transaction, then U.S. holders of JBS S.A. Common Shares generally will not recognize gain or loss with respect to the Merger of Shares and Redemption. However, no ruling will be requested from the U.S. Internal Revenue Service (“IRS”) with respect to the U.S. federal income tax consequences of the Proposed Transaction. Consequently, no assurance can be given that the IRS will not assert, or that a court would not sustain, a position to the contrary. If the Merger of Shares and Redemption do not qualify as a nonrecognition transaction, and therefore are a fully taxable transaction for U.S. federal income tax purposes, a U.S. holder of JBS S.A. Common Shares generally would recognize taxable gain or loss in an amount equal to the difference between the fair market value of any JBS. N.V. BDRs or JBS N.V. Class A Common Shares received on the date of exchange and its tax basis in the JBS S.A. Common Shares exchanged, in each case determined in U.S. dollars.

The tax consequences of the Proposed Transaction are discussed in more detail under Taxation—Material U.S. Federal Income Tax Consequences.”

The receipt of the Cash Dividend pursuant to the Proposed Transaction is expected to be taxable at ordinary income rates for U.S. federal income tax purposes.

In general, subject to the discussion below under “—Passive Foreign Investment Company Rules,” the Cash Distribution will be a distribution paid on the JBS S.A. Common Shares which will be treated (i) as a dividend to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles), (ii) to the extent of any amount of such distribution in excess of our current and accumulated earnings and profits, as a non-taxable return of capital, thereby reducing a U.S. Holder’s adjusted tax basis in the JBS S.A. Common Shares (but not below zero), and (iii) thereafter as either long-term or short-term capital gain depending upon whether the U.S. Holder held the JBS S.A. Common Shares for more than one year as of the time such distribution is actually or constructively received. Because we do not maintain calculations of our earnings and profits under U.S. federal income tax principles, it is expected that the Cash Distribution generally will be reported to U.S. Holders as a dividend, and taxable at ordinary income tax rates.

The tax consequences of the Proposed Transaction and of holding JBS N.V. Class A Common Shares or JBS N.V. BDRs are discussed in more detail below under “Taxation—Material U.S. Federal Income Tax Consequences.”

There could be adverse U.S. tax consequences to former JBS S.A. Shareholders that hold JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs following the Proposed Transaction if JBS S.A. or JBS N.V. is a passive foreign investment company.

U.S. shareholders of passive foreign investment companies are subject to potentially adverse U.S. federal income tax consequences. In general, a non-U.S. corporation is a passive foreign investment company (“PFIC”), for any taxable year in which: (1) 75% or more of its gross income consists of passive income; or (2) 50% or more of the average value of its assets (generally determined on the basis of a quarterly average) consists of assets that produce, or are held for the production of, passive income. For purposes of the above calculations, a non-U.S. corporation that owns, directly or indirectly, at least 25% by value of the shares of another corporation is treated as if it held its proportionate share of the assets of the other corporation and received directly its proportionate share of the income of the other corporation.

 

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Based on JBS S.A.’s financial statements and our current expectations regarding the value and nature of our assets, the sources and nature of our income, and relevant market and shareholder data, we do not believe that JBS S.A. or JBS N.V. was treated as a PFIC for the 2021 or 2022 taxable year and we do not anticipate JBS S.A. or JBS N.V. becoming a PFIC for the current taxable year or in the reasonably foreseeable future.

However, the determination whether we are a PFIC must be made annually after the close of each taxable year and based on the facts and circumstances at that time, such as the valuation of our assets (including, following the Proposed Transaction, the assets of JBS S.A.), including goodwill and other intangible assets, which may depend on the value of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares and JBS N.V. BDRs which can be expected to vary from time to time. Accordingly, there can be no assurance that we will not be treated as a PFIC for a given taxable year. If we are a PFIC, U.S. shareholders would be subject to certain adverse U.S. federal income tax consequences as discussed under “Taxation—Material U.S. Federal Income Tax Consequences—Passive Foreign Investment Company Rules.”

The Proposed Transaction and subsequent ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs could result in substantial Brazilian tax liability for you.

You may be required to assess Brazilian capital gains and pay Brazilian taxes in connection with the exchange of JBS S.A. Common Shares for the consideration in the Proposed Transaction or with the subsequent acquisition, ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs. See “Taxation—Material Brazilian Tax Consequences” for more information regarding the potential Brazilian tax consequences to you of the Proposed Transaction and subsequent ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs.

The Proposed Transaction and subsequent ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs could result in substantial Dutch tax liability for you.

You may be required to pay Dutch capital gains or other taxes in connection with the exchange of JBS S.A. Common Shares for the consideration in the Proposed Transaction or with the subsequent acquisition, ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs. See “Taxation—Material Dutch Tax Consequences” for more information regarding the potential Dutch tax consequences to you of the Proposed Transaction and subsequent ownership and disposal of the JBS N.V. Class A Common Shares, JBS N.V. Class B Common Shares or JBS N.V. BDRs.

Holders of JBS N.V. BDRs may be subject to additional risks related to holding BDRs rather than JBS N.V. Class A Common Shares.

Because holders of JBS N.V. BDRs will not hold their JBS N.V. Class A Common Shares directly, they are subject to the following additional risks, among others:

 

   

a holder of JBS N.V. BDRs will not be treated as a direct holder of JBS N.V. Class A Common Shares and may not be able to exercise shareholder rights;

 

   

dividends on the JBS N.V. Class A Common Shares represented by the JBS N.V. BDRs will be paid to the JBS N.V. BDR Depositary Bank, and before the JBS N.V. BDR Depositary Bank makes a distribution to a holder on behalf of the JBS N.V. BDRs, withholding taxes or other governmental charges, if any, that must be paid, will be deducted;

 

   

we and the JBS N.V. BDR Depositary Bank may amend or terminate the JBS N.V. BDR Deposit Agreement without the consent of holders of the JBS N.V. BDRs in a manner that could prejudice holders of JBS N.V. BDRs or that could affect their ability to transfer JBS N.V. BDRs, among others; and

 

   

the JBS N.V. BDR Depositary Bank may take other actions inconsistent with the best interests of holders of JBS N.V. BDRs.

 

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There are no specific rules relating to the delisting of our BDRs from the B3.

We may decide to delist the JBS N.V. BDRs from B3. In such case, we cannot guarantee that we (or any person related to us) will make a public offering for the acquisition of JBS N.V. BDRs or the underlying JBS N.V. Class A Common Shares on terms and conditions that meet the expectations of the BDR holders, who in any case will not be able to prevent us from deregistering from the CVM and delisting the JBS N.V. BDRs from the B3.

Risks Relating to Our Business and Industries

Our results of operations may be adversely affected by fluctuations in market prices for, and the availability of, livestock and animal feed ingredients.

Our operating margins depend on, among other factors, the purchase price of raw materials, primarily livestock and animal feed ingredients, and the sales price of our products. These prices may vary significantly, including during short periods of time, due to a number of factors, including beef, pork and poultry supply and demand and the market for other protein products. Raw materials accounted for a majority of the total cost of products sold during the three-month period ended March 31, 2023 and the year ended December 31, 2022. The supply and market for livestock depend on a number of factors that we have little or no control over, including outbreaks of diseases such as bovine spongiform encephalopathy (commonly referred to as mad cow disease) (“BSE”), and foot and mouth disease (“FMD”), the cost of animal feeding, economic and weather conditions.

Livestock prices demonstrate a cyclical nature both seasonally and over longer periods, reflecting the supply of, and demand for, livestock on the market and the market for other protein products such as fish. These costs are determined by constantly changing market forces of supply and demand, as well as other factors over which we have little or no control. These other factors include:

 

   

import and export restrictions;

 

   

changing livestock and grain inventory levels;

 

   

economic conditions;

 

   

crop and animal diseases; and

 

   

environmental, occupational health and safety and conservation regulations.

We do not generally enter into long-term sales arrangements with our customers with fixed price contracts, and, as a result, the prices at which we sell our products are determined in large part by market conditions. A majority of our livestock is purchased from independent producers who sell livestock to us under marketing contracts or on the open market. A significant decrease in beef, pork or chicken prices for a sustained period of time could have a material adverse effect on our net revenue. Also, a portion of our forward purchase and sale contracts are measured at fair value marked-to-market such that the related unrealized gains and losses are reported in profit or loss earnings on a quarterly basis. Such losses would adversely affect our earnings and may cause significant volatility in our quarterly earnings.

Profitability in the processing industry is materially affected by the commodity prices of animal feed ingredients, such as grain, corn and soybeans. The production of feed ingredients is positively or negatively affected due to various factors, primarily by the global level of supply inventories and demand for feed ingredients, the agricultural policies of the United States and foreign governments and weather patterns throughout the world. Market prices for feed ingredients remain volatile. High prices for animal feed ingredients may have a material adverse effect on our operating results.

Accordingly, we may be unable to pass on all or part of any increased costs we experience from time to time to consumers of our products directly, in a timely manner or at all. Additionally, if we do not attract and maintain contracts or marketing relationships with independent producers and growers, our production operations could be disrupted, adversely affecting us.

 

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Outbreaks of animal diseases may affect our ability to conduct our business and harm demand for our products.

Supply of and demand for our products can be adversely impacted by outbreaks of animal diseases, which can have a significant impact on our financial results. Outbreaks of diseases affecting animals, such as BSE, FMD and various strains of influenza, which may be caused by factors beyond our control, or concerns that these diseases may occur and spread in the future, could significantly affect demand for our products, consumer perceptions of certain protein products, the availability of livestock for purchase by us and our ability to conduct our operations, including as a result of cancellations of orders by our customers or governmental restrictions on the import and export of our products to or from our suppliers, facilities or customers. For example, in February 2023, Brazil suspended beef exports to China following one confirmed case of atypical mad cow disease in Brazil. This suspension lasted approximately one month. Although we don’t expect this suspension to have a material adverse effect on us given that sales of beef from Brazil to China represented less than 3% of JBS S.A. total consolidated net revenue in the three-month period ended March 31, 2023 and the year ended December 31, 2022 and are not expected to represent a significant percentage of our total revenue in 2023, another case or outbreak of mad cow disease in the markets where we produce beef that leads to a more geographically widespread and/or longer lasting suspension of our beef sales may have a more significant adverse effect on results of operations and share price. Moreover, outbreaks of animal diseases could have a significant effect on the livestock we own by requiring us to, among other things, destroy any affected livestock and create negative publicity that may have a material adverse effect on customer demand for our products. In addition, if the products of our competitors become contaminated, the adverse publicity associated with such an event may lower consumer demand for our products.

Any perceived or real health risks related to the food industry could adversely affect our ability to sell our products. If our products become contaminated, we may be subject to product liability claims and product recalls.

We are subject to risks affecting the food industry generally, including risks posed by the following:

 

   

food spoilage or food contamination;

 

   

consumer product liability claims;

 

   

product tampering;

 

   

the possible unavailability and expense of product liability insurance; and

 

   

the potential cost and disruption of a product recall.

Our products have in the past been, and may in the future be, exposed to contamination by organisms that may produce food borne illnesses, such as E. coli, listeria monocytogenes and salmonella. These organisms and pathogens are found generally in the environment and, as a result, there is a risk that they could be present in our products. These organisms and pathogens can also be introduced to our products through tampering or as a result of improper handling at the further processing, foodservice or consumer level. Once contaminated products have been shipped for distribution, illness or death may result if the products are not properly prepared prior to consumption or if the organisms and pathogens are not eliminated in further processing.

Our systems designed to monitor food safety risks may not eliminate the risks related to food safety. We have little, if any, control over handling procedures once our products have been shipped for distribution. If any of our products are determined to be contaminated, spoiled or inappropriately labeled, whether or not we are at fault, we may voluntarily recall, or be required to recall, our products. A widespread product recall could result in significant losses due to the costs of a recall, the destruction of product inventory and lost sales due to the unavailability of product for a period of time. We may also be subject to increased risk of exposure to product liability claims and governmental proceedings, which may result in penalties, injunctive relief and plant closings. Any of these occurrences may have an adverse effect on our financial results.

 

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We may be subject to significant liability in the jurisdictions in which our products are sold if the consumption of any of our products causes injury, illness or death. Such liability may result from proceedings filed by the government’s attorney’s office, consumer agencies and individual consumers. Even an inadvertent shipment of contaminated products may be a violation of law. We may have to pay significant damages to consumers or to the government and such liability may be in excess of applicable liability insurance policy limits.

In addition, adverse publicity concerning any perceived or real health risk associated with our products could also cause customers to lose confidence in the safety and quality of our food products, which could adversely affect our ability to sell our products. We could also be adversely affected by perceived or real health risks associated with similar products produced by others to the extent such risks cause customers to lose confidence in the safety and quality of such products generally.

Changes in consumer preferences and/or negative perception of the consumer regarding the quality and safety of our products could adversely affect our business.

The food industry is generally subject to changing consumer trends, demands and preferences. Our products compete with other protein sources, such as fish. In addition, we compete with plant-based meat products as consumer demand for plant-based protein alternatives has increased due to the perceived consumer concerns related to human health, climate change, resource conservation and animal welfare. Trends within the food industry frequently change, and our failure to anticipate, identify or react to changes in these trends could lead to reduced demand and prices for our products, among other concerns, and could have a material adverse effect on our business, financial condition and results of operations.

We could also be adversely affected if consumers lose confidence in the safety and quality of our food products or ingredients, or in the food safety system generally. Negative perceptions concerning the health implications of certain food products, or ingredients or loss of confidence in the food safety system generally, could influence consumer preferences and acceptance of some of our products and marketing programs. Negative perceptions and failure to satisfy consumer preferences could materially and adversely affect our product sales, financial condition and results of operations.

We face competition in our business, which may adversely affect our market share and profitability.

The beef, pork and chicken industries are highly competitive. Competition exists both in the purchase of live cattle and hogs and grains, and in the sale of beef, pork and chicken products. In addition, our beef, pork and chicken products compete with other protein sources, such as fish. We face competition from a number of beef, pork and chicken producers in the countries in which we operate.

The principal competitive factors in the animal protein processing industries are operating efficiency and the availability, quality and cost of raw materials and labor, price, quality, food safety, product distribution, technological innovations and brand loyalty. Our ability to be an effective competitor depends on our ability to compete on the basis of these characteristics. In addition, some of our competitors may have greater financial and other resources than us. We may be unable to compete effectively with these companies, in which case our market share and, consequently, our operations and results may be adversely affected.

Our growth (organic and inorganic) may require substantial capital and long-term investments.

Our competitiveness and growth depend on our ability to fund our capital expenditures. We cannot assure you that we will be able to fund our capital expenditures at reasonable costs due to adverse macroeconomic conditions, our performance or other external factors, which could have a material adverse effect on our business, financial condition and results of operations.

 

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We may pursue additional opportunities to acquire complementary businesses, which could further increase leverage and debt service requirements and could adversely affect our financial situation, especially if we fail to successfully integrate the acquired business.

We intend to continue to pursue selective acquisitions of complementary businesses in the future. Inherent in any future acquisitions are certain risks such as increasing leverage and debt service requirements and combining company cultures and facilities, which could have a material adverse effect on our operating results, particularly during the period immediately following such acquisitions. Additional debt or equity capital may be required to complete future acquisitions, and there can be no assurance that we will be able to raise the required capital. Furthermore, acquisitions involve a number of risks and challenges, including:

 

   

diversion of management’s attention;

 

   

potential loss of key employees and customers of the acquired companies;

 

   

an increase in our expenses and working capital requirements;

 

   

failure of the acquired entities to achieve expected results;

 

   

our failure to successfully integrate any acquired entities into our business; and

 

   

our inability to achieve expected synergies and/or economies of scale.

These opportunities may also expose us to successor liability relating to actions involving any acquired entities, their respective management or contingent liabilities incurred prior to our involvement and will expose us to liabilities associated with ongoing operations, in particular to the extent we are unable to adequately and safely manage such acquired operations. These transactions may also be structured in such a manner that would result in our assumption of obligations or liabilities not identified during our pre-acquisition due diligence.

Any of these factors could adversely affect our ability to achieve anticipated cash flows at acquired operations or realize other anticipated benefits of acquisitions, which could adversely affect our reputation and have a material adverse effect on us.

We are not prohibited from incurring significantly more debt.

As of March 31, 2023, our total outstanding indebtedness was US$18,248.7 million, consisting of US$1,975.1 million of current loans and financings and US$16,273.6 million of non-current loans and financings. If we are unable to repay or refinance our current or non-current loans and financings as they mature, this would have a material adverse effect on our financial condition. The terms of the contracts governing our existing debt permit us to incur significant additional indebtedness in the future, including secured debt. We may borrow additional funds to fund our capital expenditures, working capital needs or other purposes, or to fund future acquisitions. In addition, under the terms of our existing debt, we are also permitted to incur significant additional short-term or long-term indebtedness, and our consolidated debt levels could increase. See “Description of Material Indebtedness.

Covenant restrictions under debt agreements limit our ability to operate our business.

Our debt agreements contain, among other provisions, covenants that restrict our ability to finance future operations or capital needs or to engage in other business activities by limiting our ability to:

 

   

incur additional indebtedness;

 

   

create liens on or sell our assets;

 

   

pay dividends on or redeem capital stock;

 

   

make restricted payments;

 

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create or permit restrictions on the ability of subsidiaries to pay dividends or make other distributions;

 

   

enter into transactions with affiliates; and

 

   

engage in mergers, consolidations and certain dispositions of assets.

In addition, certain of our credit facilities require us and certain of our subsidiaries to maintain specified financial ratios and tests which may require that we or they take action to reduce debt or to act in a manner contrary to our business objectives. Events beyond our control, including changes in general business and economic conditions, may affect our ability to meet those financial ratios and tests.

We may not meet those ratios and tests, and our creditors may not waive any failure to meet those ratios and tests. A breach of any of these covenants or failure to maintain these ratios would result in an event of default under the relevant credit facility, and any such event of default or resulting acceleration under such credit facilities could result in an event of default under the indentures governing the notes and other debt agreements.

In addition, the covenant package in the indentures governing all of our notes and possibly future offerings are or will be “investment-grade” and do not or will not contain covenants that restrict our ability to incur debt, pay dividends, make investments or enter into transactions with affiliates, among other provisions.

Failure by us to achieve our sustainability performance targets may result in increased interest payments under future financings and harm to our reputation.

As described in “Description of Material Indebtedness—Fixed Rate Notes—Sustainability-Linked Bonds” and “—JBS S.A. Agribusiness Credit Receivable Certificates (Certificados de Recebĺveis do Agronegócio)Sustainability-Linked CRAs,” certain of our debt instruments contain certain sustainability performance targets of JBS S.A., JBS USA or PPC that if unsatisfied will result in an increase in the interest rate payable on the respective debt instruments. Achieving these sustainability performance targets or any similar sustainability performance targets we may choose to include in future financings or other arrangements will require us to expend significant resources. In addition, a failure by us to achieve these sustainability performance targets would not only result in increased interest payments under relevant financing arrangements, but could also harm our reputation, all of which could have a material adverse effect on our results of operations, financial condition and liquidity.

We are subject to interest rate fluctuations, which may be harmful to our business.

A portion of our debt is subject to interest rate fluctuations, including fluctuations in: (1) the London Interbank Offered Rate (“LIBOR”), the secured overnight financing rate (“SOFR”), and the Euro Interbank Offered Rate (“EURIBOR”) and (2) Brazilian financial market rates or inflation rates, such as the CDI and the Long-Term Interest Rate (Taxa de Juros de Longo Prazo) (the “Brazilian TJLP rate”) (Brazil’s long-term interest rate published quarterly by the Brazilian National Monetary Council). We are also exposed to exchange rate risk because we have assets and liabilities and future cash flows and earnings denominated in foreign currencies. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Quantitative and Qualitative Disclosures About Market Risk.” Fluctuations in exchange rates and interest rates are caused by a number of factors that are beyond our control.

If interest rates, such as LIBOR, SOFR, EURIBOR, the CDI and Brazilian TJLP rates, or exchange rates increase significantly, our finance expenses will increase and our ability to obtain financings may decrease, which may materially adversely affect our results of operations.

Unfavorable decisions in legal, administrative, antitrust or arbitration proceedings and government investigations may adversely affect us.

We are defendants in legal, administrative, antitrust and arbitration proceedings arising from the ordinary conduct of our business, particularly with respect to civil, tax, labor and environmental claims, which may be

 

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decided to our detriment, and are involved in various government investigations. For more information regarding our proceedings and investigations, see “Information about JBS S.A.—Legal Proceedings.” In addition, we cannot guarantee that new lawsuits (judicial or administrative of any nature) or investigations against us, our ultimate controlling shareholders and managers will not arise.

Applicable laws and regulations could subject us and our managers to civil and criminal penalties, including debarment from contracts concluded with the public administration and prohibition to celebrating new ones and loss of fiscal benefits, which could materially and adversely affect our product sales, reputation, financial condition and results of operations. Adverse rulings that have material economic or reputational impacts on us or impede the execution of our growth plan may adversely affect our financial condition and results of operations. In addition, unfavorable decisions in proceedings or investigations involving us and our ultimate controlling shareholders and managers may affect our image and business.

For certain lawsuits, we were not required to and have not established any provision on our statement of financial position or have established provisions only for part of the amounts in dispute, based on our judgments as to the likelihood of winning these lawsuits. We cannot guarantee that the provisioned amounts (if any) will be sufficient to cover the costs and expenses of the corresponding proceedings, which could adversely impact our business and operating results.

We may not be able to ensure that our raw material suppliers are in compliance with all applicable environmental and labor laws and regulations, which could adversely affect our business, financial condition and results of operations.

The raising of cattle and other livestock is at times associated with deforestation, invasion of indigenous lands and protected areas and other environmental and human rights concerns. Most of the cattle we process are raised by our suppliers. If we are unable to ensure that the suppliers of the cattle we use in our production process are in compliance with all applicable environmental and human rights laws and regulations, we may be subject to fines and other penalties that may adversely affect our image, reputation, business, financial condition and results of operations.

Furthermore, Brazilian Environmental Policy Act, outlined in Federal Law No. 6,938/1981, regulates civil liability for damages caused to the environment and sets forth strict liability on the subject matter. Therefore, we may become party to environmental liability proceedings amongst any damage originator. As the majority of cattle processed by us are bred by third parties and subcontractors, we may be significantly impacted if third parties and subcontractors cause environmental damages in the implementation of their activities on our behalf.

We are subject to various risks relating to worker safety.

Given the nature of our operations, the type of work performed by our employees, and the number of plants and employees that we have throughout the world, we are subject to various risks relating to worker safety. We cannot ensure that accidents will not occur. If our efforts to improve worker safety and reduce the frequency and number of workplace accidents are not successful, we may become subject to lawsuits, regulatory or administrative investigations and inquiries, fines and penalties, and our business, financial condition and results of operations may be adversely affected.

For example, a U.S. House of Representatives Select Subcommittee held a hearing in December 2022 entitled “Preparing For And Preventing The Next Public Health Emergency: Lessons Learned From The Coronavirus Crisis.” This hearing was accompanied by a final report of the same name, which describes an investigation of the largest companies in the U.S. meatpacking industry, including our subsidiary JBS USA Food Company, in the context of the Trump Administration’s response to the risks faced by these companies’ workers during the COVID-19 pandemic. JBS USA Food Company has complied with the document requests made in 2021 as part of the investigation.

 

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We may also suffer reputational harm due to the actions of unrelated companies that do not adhere to applicable worker safety laws in the provision of services to us. For example, the U.S. Department of Labor commenced an investigation into allegations of child labor at certain of our facilities in August 2022. While this investigation did not result in any finding that we were employing any underage workers at any of our facilities, a federal judge granted a temporary restraining order against one of our suppliers. While such supplier is not affiliated with us, the investigation found that it had used underage workers to provide cleaning and sanitation services in the fulfillment of sanitation and cleaning contracts that it was performing at JBS facilities. Such supplier has entered into a consent order and judgment pursuant to which it has agreed to comply with child labor laws at all of the facilities where it provides services.

Additionally, we have from time to time had incidents at our plants involving worker health and safety. These have included ammonia releases due to mechanical failures in chiller systems and worker injuries and fatalities involving processing equipment and vehicle accidents. We have taken preventive measures in response; however, we can make no assurance that similar incidents will not arise in the future. New environmental, health and safety requirements, stricter interpretations of existing requirements, or obligations related to the investigation or clean-up of contaminated sites, may materially affect our business or operations in the future.

While we adhere and require adherence from suppliers to all applicable worker safety laws throughout our global operations, no assurance can be given that we will not be materially adversely affected to the extent that companies that provide services to us do not demonstrate the same commitment to such laws. In addition, no assurance can be given that our reputation for worker safety will not be adversely affected by governmental investigations or other inquiries in the future.

We depend on our information technology systems, and any failure of these systems could adversely affect our business.

We depend on information technology systems for significant elements of our operations, including the storage of data and retrieval of critical business information, and within our supply chain. We also depend on our information technology infrastructure for digital marketing activities and for electronic communications among our locations, personnel, customers, and suppliers. Although our information systems are protected with robust backup systems, including physical and software safeguards and remote processing capabilities, our information technology systems and those of our supply chain are vulnerable to damage from a variety of sources, including network failures, malicious human acts, and natural disasters. Moreover, despite network security and back-up measures, some of our servers are potentially vulnerable to physical or electronic break-ins, computer viruses, and similar disruptive problems. In addition, certain software used by us is licensed from, and certain services related to our information systems are provided by, third parties who could choose to discontinue their relationship with us. Failures or disruptions to our information technology systems or those used by our third-party service providers could prevent us from conducting our general business operations, and adversely affect our ability to process orders, maintain proper levels of inventories, collect accounts receivable, pay expenses, and maintain the security of our company and customer data. Any disruption or loss of information technology systems on which critical aspects of our operations depend could have an adverse effect on our business, results of operations, and financial condition.

For example, on May 30, 2021, we were the target of an organized cybersecurity attack (the “Cyberattack”), affecting some of the servers supporting our North American and Australian information technology systems. JBS USA’s backup servers were not affected. JBS USA and PPC’s operations in North America and Australia were affected. PPC’s operations in Mexico and the United Kingdom were not impacted and conducted business as normal. Upon learning of the intrusion, we contacted federal officials and activated our cybersecurity protocols, including voluntarily shutting down all affected systems to isolate the intrusion, limit the potential infection and preserve core systems. Restoring systems critical to production was prioritized. In addition, the encrypted backup servers, which were not affected by the Cyberattack, allowed for a return to full operations within two days. As of June 3, 2021, JBS USA and PPC had resumed production at all of their facilities. Our

 

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response, IT systems and encrypted backup servers allowed for a rapid recovery from the Cyberattack. As a result, the loss of food produced was limited to less than one day of production. We are not aware of any evidence that any customer, supplier or employee data had been compromised or misused as a result of the Cyberattack. Since the Cyberattack, we have been working to improve our cybersecurity posture in order to minimize our risk and attack surface. We have identified good practices we had in place before the Cyberattack, and we have identified and completed items and actions that were needed to remediate.

Further, we store highly confidential information on our information technology systems, including information related to our products. If our servers or the servers of the third party on which our data is stored are attacked by a physical or electronic break-in, computer virus or other malicious human action, our confidential information could be stolen or destroyed. Any security breach involving the misappropriation, loss or other unauthorized disclosure or use of confidential information of our suppliers, customers, or others, whether by us or a third party, could disrupt our operations, subject us to civil and criminal penalties, have a negative impact on our reputation, expose us to liability to our suppliers, customers, other third parties or government authorities and increase our cyber-security protection and remediation costs. Any of these developments could have an adverse impact on our business, financial condition and results of operations. In addition, if our supply chain cybersecurity is compromised as a result of third-party action, employee error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our business may be harmed and we could incur significant liabilities. We mitigate this risk by having a diversified supply chain. There can be no assurance that we will be able to prevent all of the rapidly evolving forms of increasingly sophisticated and frequent cyber-attacks. Moreover, our efforts to address network security vulnerabilities may not be successful, resulting potentially in the theft, loss, destruction or corruption of information we store electronically, as well as unexpected interruptions, delays or cessation of service, any of which would cause harm to our business operations. The vulnerability of our systems and our failure to identify or respond timely to cyber incidents could have an adverse effect on our operations and reputation and expose us to liability or regulatory enforcement actions.

The loss of members of our senior management or our inability to attract and retain qualified senior management personnel could have an adverse effect on us.

Our ability to maintain our competitive position depends in large part on the performance of our senior management team, mainly because of our business model and our acquisition strategy. As a result of factors such as strong global economic conditions, we may lose key employees or face problems hiring qualified key employees. In order to retain key employees, we may have to make significant changes in our compensation policy to remain competitive, which would increase our costs. There is no assurance that we will succeed in attracting and retaining qualified senior management personnel. Also, decisions in any administrative proceedings involving our current managers may prevent them from remaining in their positions at our company. The loss of the services of any member of our senior management or our inability to attract and retain qualified personnel could have an adverse effect on us.

Our performance depends on favorable labor relations with our employees and our compliance with labor laws. Any deterioration of those relations or increase in labor costs could adversely affect our business.

As of March 31, 2023, we had approximately 260,000 employees worldwide. Certain of these employees are represented by labor organizations, and our relationships with these employees are governed by collective bargaining agreements. We may not reach new agreements without union action and any such new agreements may not be on terms satisfactory to us. In addition, any new agreements may be for shorter durations than our historical agreements. Moreover, additional groups of currently non-unionized employees may seek union representation in the future. If we are unable to negotiate acceptable collective bargaining agreements, we may become subject to union-initiated work stoppages, including strikes. Any significant increase in labor costs, deterioration of employee relations, slowdowns or work stoppages at any of our locations, whether due to union activities, employee turnover or otherwise, could have a material adverse effect on our business, financial condition, results of operations and cash flows.

 

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The consolidation of a significant number of our customers could adversely affect our business.

Many of our customers, such as supermarkets, warehouse clubs and food distributors, have consolidated in recent years, and consolidation is expected to continue. These consolidations have produced large, sophisticated customers with increased buying power who are more capable of operating with reduced inventories, opposing price increases, and demanding lower pricing, increased promotional programs and specifically tailored products. These customers also may use shelf space currently used for our products for their own private label products that are generally sold at lower prices. In addition, in periods of economic uncertainty, consumers tend to purchase more lower-priced private label or other economy brands. To the extent this occurs, we could experience a reduction in the sales volume of our higher margin products or a shift in our product mix to lower margin offerings. Because of these trends, we may need to lower prices or increase promotional spending for our products. The loss of a significant customer or a material reduction in sales to, or adverse change to trade terms with, a significant customer could materially and adversely affect our product sales, financial condition and results of operations.

Our ultimate controlling shareholders are expected to have influence over the conduct of our business and may have interests that are different from yours.

Our controlling shareholders are J&F and FIP Formosa, which are in turn wholly owned by our ultimate controlling shareholders, Messrs. Joesley Mendonça Batista and Wesley Mendonça Batista. See “Principal Shareholders.” Assuming the ownership of JBS S.A.’s common shares on the Last Trading Day is the same as on June 30, 2023, immediately upon completion of the Proposed Transaction, our controlling shareholders will (indirectly, through LuxCo) hold 48.83% of the then-outstanding JBS N.V. Common Shares and 85.03% of the aggregate voting power in JBS N.V. through their ownership of 100% of the then-outstanding JBS N.V. Class B Common Shares and 30.04% of the then-outstanding JBS N.V. Class A Common Shares. Because each JBS N.V. Class B Common Share confers the right to 10 votes at a general meeting of shareholders, our ultimate controlling shareholders will effectively control all matters requiring shareholder approval. See “Description of Share Capital—Share Capital.” Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. The exact percentage of the then-outstanding JBS N.V. Shares and aggregate voting power in JBS N.V. that will be held (indirectly) by our controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the amount of JBS S.A. shares held by these entities on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction. See “—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—Following the completion of the Proposed Transaction and the Class A Conversion Period, our controlling shareholders’ aggregate voting power in JBS N.V. may increase significantly” and “—The dual class structure of the JBS N.V. Common Shares has the effect of concentrating voting control with our Class B shareholders and limiting our other shareholders’ ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of JBS N.V. Class A Common Shares may view as beneficial.”

Relatives of our ultimate controlling shareholders perform certain management and leadership roles at JBS S.A. and related companies. Mr. José Batista Sobrinho, the founder of JBS S.A. and the father of Joesley and

 

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Wesley Mendonça Batista, serves as the Vice-Chairman of JBS S.A.’s board of directors and has served on the JBS S.A. board of directors since 2007. Mr. Wesley Mendonça Batista Filho, who is the son of Wesley Mendonça Batista and the grandson of José Batista Sobrinho, serves as the Chief Executive Officer of JBS USA since May 2023, and has served as an executive officer of JBS S.A. since 2017 and in other senior management positions in JBS Group companies in the past, including as Chief Executive Officer of Seara Alimentos. He also serves on the board of directors of various JBS Group companies. In addition, Mr. Henrique Mendonça Batista, who is also Wesley Mendonça Batista’s son, serves as the President of Huon, an Australian salmon processing company acquired by JBS S.A. in 2021. Messrs. Joesley Mendonça Batista and Wesley Mendonça Batista may serve as members of the board of directors of, or in other senior management positions at, JBS N.V. or its affiliated companies.

As further described elsewhere in this prospectus (see “Principal Shareholders—Civil and Criminal Actions and Investigations involving our Ultimate Controlling Shareholders” and “—We are subject to reputational risk in connection with U.S. and Brazilian civil and criminal actions and investigations involving our ultimate controlling shareholders, and these actions may materially adversely impact our business and prospects and damage our reputation and image”), in 2017, our ultimate controlling shareholders, among others, entered into collaboration agreements (acordos de colaboração premiada) (the “Collaboration Agreements”) with the Brazilian Attorney General’s Office (Procuradoria-Geral da República) and a leniency agreement (the “Leniency Agreement”) with the Brazilian Federal Prosecution Office (Ministério Público Federal) following disclosures of illicit payments made to Brazilian politicians from 2009 to 2015. Pursuant to the Leniency Agreement, J&F agreed to pay a fine of R$8.0 billion and contribute R$2.3 billion to social projects in Brazil over a 25-year period. J&F, JBS S.A., and our ultimate controlling shareholders (the “Respondents”) also entered into a settlement with the SEC in 2020. Pursuant to the SEC settlement and related order, the Respondents undertook to, among other things, to improve anti-bribery and anti-corruption compliance programs, make progress reports to the SEC, and pay disgorgement and civil penalties. Also in 2020, J&F reached a plea agreement with the DOJ in which J&F pled guilty to one count of conspiracy to violate the U.S. Foreign Corrupt Practices Act and agreed to pay a criminal penalty. The DOJ plea agreement also required J&F to implement a compliance program and improve its internal policies and to make progress and other reports to the DOJ. Since 2017, JBS S.A. and J&F have implemented numerous and material changes to their anti-corruption compliance policies intended to detect and prevent illicit payments and conduct throughout their operations, including the introduction of new policies and practices and the hiring of experienced professionals who have a track record of building effective compliance programs, all as further detailed in “Information about JBS S.A.—Compliance Program.” In addition, the terms of the above-referenced agreements with Brazilian authorities, the SEC and the DOJ provide strong disincentives to any violation of their terms. Moreover, we believe that the Brazilian political and governmental environment has evolved in recent years away from an environment in which illicit payments were incentivized. Our management and leadership team is strongly committed to operating our business in compliance with anti-corruption principles and law. However, no assurance can be given that new and improved policies, practices and personnel will be effective to detect or prevent illicit activities in all cases.

In addition, our ultimate controlling shareholders may have an interest in causing us to pursue transactions that may enhance the value of their equity investments in us, even though such transactions may involve increased risks to us or the holders of our common shares. Furthermore, our ultimate controlling shareholders own, through J&F or other entities, equity investments in other businesses and may have an interest in causing us to pursue transactions that may enhance the value of those other equity investments, even though such transactions may not benefit us. Our ultimate controlling shareholders may also have an interest in pursuing new business opportunities that would otherwise be available to us through other companies which they own. In addition, JBS S.A. or other companies in which our ultimate controlling shareholders have an interest may engage in transactions with JBS USA or its subsidiaries.

We cannot assure you that we will be able to address these conflicts of interests or others in an impartial manner.

 

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Given the degree of control over our company that is expected to be held by our controlling shareholders and our ultimate controlling shareholders following the consummation of the Proposed Transaction, there can be no assurance that the future actions or decisions of our controlling shareholders and our ultimate controlling shareholders will not impact our company, our prospects, and the value of the JBS N.V. Class A Common Shares and JBS N.V. BDRs in ways that differ from your interests.

We are subject to reputational risk in connection with U.S. and Brazilian civil and criminal actions and investigations involving our ultimate controlling shareholders, and these actions may materially adversely impact our business and prospects and damage our reputation and image.

In 2017, following disclosures of illicit payments made to Brazilian politicians from 2009 to 2015, our ultimate controlling shareholders, among others, entered into Collaboration Agreements with the Brazilian Attorney General’s Office (Procuradoria-Geral da República) and a Leniency Agreement with the Brazilian Federal Prosecution Office (Ministério Público Federal). In 2020, our ultimate controlling shareholders also entered into a settlement with the SEC and J&F reached a plea agreement with the DOJ relating to the illicit conduct. For more information about the facts and circumstances underlying these agreements, see “Principal Shareholders—Civil and Criminal Actions and Investigations involving our Ultimate Controlling Shareholders.” The Brazilian Collaboration Agreements and Leniency Agreement, the SEC order and the DOJ plea agreement have resolved the Brazilian and U.S. criminal legal exposure of JBS S.A, J&F and our ultimate controlling shareholders related to the illicit conduct that was the subject of the Leniency Agreement.

Our ultimate controlling shareholders, JBS S.A. and J&F are in compliance with all of the financial and non-financial obligations pursuant to the Brazilian Collaboration Agreements and Leniency Agreement, the SEC order and the DOJ plea agreement. A breach of any of these agreements could have an adverse effect on us.

In addition, our ultimate controlling shareholders are currently subject to ongoing investigations by the CVM in Brazil and to criminal proceedings for alleged violations of Brazilian securities and corporate law, in which there has yet to be a final decision. For more information about these investigations, see “Principal Shareholders—Civil and Criminal Actions and Investigations involving our Ultimate Controlling Shareholders—CVM Investigations and Proceedings.”

As a result of the above-mentioned matters, the reputation of our controlling shareholders, our ultimate controlling shareholders and JBS S.A. has suffered and may continue to suffer. To the extent that the negative reputational impact of these events continues into the future, if pending investigations and proceedings are not resolved favorably to JBS S.A. and our ultimate controlling shareholders, or if future events or actions give rise to new investigations or proceedings, our ability to execute our business strategies, enter into beneficial transactions, partnerships or acquisitions, and the value of the JBS N.V. Class A Common Shares and/or JBS N.V. BDRs may be materially negatively affected.

Furthermore, we cannot guarantee that negative news and publicity (whether or not factually accurate) will not be released in the future that involve our company, JBS S.A., our controlling shareholders or our ultimate controlling shareholders. We also cannot be certain that any actions we take in response to a reputational crisis will be effective or sufficient. Actions or allegations (whether grounded or unfounded) regarding actions taken by third parties, including our controlling shareholders, our ultimate controlling shareholders, or our suppliers or partners, including, but not limited to, illegal acts or corruption, actions contrary to health or worker safety, or actions contrary to socio-environmental regulations, may materially adversely impact our reputation and image with our customers, suppliers and partners and the market, which may have a material adverse effect on our business, results of operations, financial condition and future prospects and the value of the JBS N.V. Class A Common Shares and/or JBS N.V. BDRs.

 

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Risks Relating to the Markets in Which We Operate

Deterioration of global economic conditions could adversely affect our business.

Our business may be adversely affected by changes in global economic conditions, including changes in GDP, inflation, interest rates, availability of capital, consumer spending rates, energy availability and costs (including fuel surcharges) and the effects of governmental initiatives to manage economic conditions. Any such changes could adversely affect the demand for products both in domestic and international markets, or the cost and availability of our needed raw materials, including cooking ingredients and packaging materials, thereby adversely affecting our financial results.

Disruptions in credit and other financial markets and deterioration of global economic conditions could:

 

   

adversely affect global demand for protein products, which could result in a reduction of sales, operating profit and cash flows;

 

   

make it more difficult or costly for us to obtain financing for our operations or investments or to refinance our debt in the future;

 

   

cause our lenders to depart from prior credit industry practice and make more difficult or expensive the granting of any technical or other waivers under our debt agreements to the extent we may seek them in the future;

 

   

impair the financial condition of some of our customers and suppliers; and

 

   

decrease the value of our investments.

In addition, inflation, which has significantly risen, has and may continue to increase our operational costs, including labor costs and grain and feed ingredient costs, and continued increases in interest rates in response to concerns about inflation may have the effect of further increasing economic uncertainty and heightening these risks. As a result, instability and weakness of the U.S. and global economies, including due to the effects caused by disruptions to financial markets, inflation, recession, high unemployment, geopolitical events and other effects caused by the COVID-19 pandemic, and the negative effects on consumers’ spending, may materially negatively affect our business and results of operations. A prolonged period of reduced consumer spending could have an adverse effect on our business and our results of operations.

Our exports pose special risks to our business and operations.

Exports account for a significant portion of our net revenue, representing 23.2% and 26.4% of our net revenue for the three-month period ended March 31, 2023 and the year ended December 31, 2022, respectively. Exports subject us to risk factors that are outside our control in our principal sales markets, including:

 

   

changes in foreign currency exchange rates;

 

   

deterioration of economic conditions;

 

   

imposition of tariffs and other trade and/or health barriers;

 

   

exchange controls and restrictions to exchange operations;

 

   

strikes or other events that may affect ports and transportation;

 

   

compliance with different foreign legal and regulatory regimes; and

 

   

trade barriers.

For example, between May 21 and May 31, 2018, Brazil suffered an extensive nationwide trucking strike. With trucks stopped and blocking highways, supplies of fuel, food and medical supplies ceased being delivered to distribution points. The stoppage began to subside on May 27, 2018, after representatives of the trucking industry and the Brazilian government reached an agreement.

 

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Our future financial performance will depend significantly on economic, political and social conditions in our principal operating and sales markets. Negative consequences relating to these risks and uncertainties could jeopardize or limit our ability to transact business in one or more of those markets where we operate or in other developing markets and could materially adversely affect us.

We are subject to ordinary course audits in the jurisdictions where we operate and changes in tax laws and unanticipated tax liabilities, in either case, could adversely affect the taxes we pay and therefore our financial condition and results of operations.

As a global company, we are subject to ordinary course audits in the jurisdictions where we operate, including audits currently being conducted by applicable tax authorities in Brazil, Australia and the United Kingdom. The resolution of these audits remains uncertain, and we have not established any reserves for any potential liability relating to these or any other audits. It is possible that we could, in the future, incur unanticipated tax liabilities arising from these or any other audits, which could adversely impact our financial condition and results of operations.

In addition, we are subject to taxation in numerous countries, states and other jurisdictions. Tax laws, tax treaties, regulations, and administrative practices or their interpretation in various jurisdictions, including the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting that has been agreed to by many of the countries in which we operate, may be subject to significant change, with or without notice, due to economic, political and other conditions, and significant judgment is required in applying the relevant provisions of tax law.

Furthermore, in Brazil, the income tax exemption on dividend distribution and interest on shareholders’ equity (juros sobre capital próprio) applicable under current legislation may be reviewed the possibility to declare and both dividends received and distributed may be taxed and, in the case of interest on shareholders’ equity (juros sobre capital próprio) be prohibited or have its taxation increased in the future, impacting the net amount to be received by our shareholders.

If such changes were to be adopted or if the tax authorities in the jurisdictions where we operate were to challenge our application of relevant provisions of applicable tax laws, our financial condition and results of operations could be adversely affected.

We are exposed to emerging and developing country risks.

Our operations in emerging and developing countries are subject to the customary risks of operating in these countries, which include potential political and economic uncertainty, government debt crises, application of exchange controls, reliance on foreign investment, nationalization or expropriation, crime and lack of law enforcement, political insurrection, terrorism, religious unrest, external interference, currency fluctuations and changes in government policy.

In Brazil, for example, the federal government frequently intervenes in the economy and its actions to control inflation and other regulations and policies have often involved, among other measures, increases in interest rates, changes in tax policies, price controls, currency devaluations, capital controls and limits on imports, among others. Due to our exposure in Brazil, these factors could affect us more than our competitors with less exposure to such emerging and developing countries, and any general decline in emerging and developing countries as a whole could impact us disproportionately compared to our competitors.

Such factors could affect our results by causing interruptions to operations, by increasing the costs of operating in those countries or by limiting the ability to repatriate profits from those countries. These circumstances could adversely impact our business, results of operations and financial condition.

 

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Our business may be negatively impacted by economic or other consequences from Russia’s war against Ukraine and the sanctions imposed as a response to that action.

We face risks related to the ongoing Russia-Ukraine war that began in February 2022. The impact of the ongoing war and sanctions will not be limited to businesses that operate in Russia and Ukraine and may negatively impact other global economic markets including where we operate. The impacts have included and may continue to include, but are not limited to, higher prices for commodities, such as food products, ingredients and energy products, increasing inflation in some countries, and disrupted trade and supply chains. The conflict has disrupted shipments of grains, vegetable oils, fertilizer and energy products.

The impact on the agriculture markets falls into two main categories: (1) the effect on Ukrainian crop production, as the region is key in global grain production; and (2) the duration of the disruption in trade flows. Safety and financing concerns in the region are restricting export execution, which is in turn forcing grain and oil demand to find alternative supply. The duration of the war and related volatility makes global markets extremely sensitive to growing-season weather in other global grain producing regions and has led to a large risk premium in futures contracts prices used for hedging. The continued volatility in the global markets as a result of the war has adversely impacted our costs by driving up prices, raising inflation and increasing pressure on the supply of feed ingredients and energy products throughout the global markets.

In addition, the U.S. government and other governments in jurisdictions in which we operate have imposed sanctions and export controls against Russia, Belarus and interests therein and threatened additional sanctions and controls. The impact of these measures, now and in the future, could adversely affect our business, supply chain or customers.

Finally, there may be increased risk of cyberattack as a result of the ongoing conflict. We have not seen any new or heightened risk of potential cyberattacks since the outbreak of the Russia-Ukraine war. See “—Risks Relating to Our Business and Industries—We depend on our information technology systems, and any failure of these systems could adversely affect our business” for additional information.

Market fluctuations could negatively impact our operating results, and our business may be adversely impacted by risks related to hedging activities.

Our business is exposed to potential changes in the value of our derivative instruments primarily caused by fluctuations in currency exchange rates and commodities prices. These fluctuations may result from changes in economic conditions, investor sentiment, monetary and fiscal policies, the liquidity of global markets, international and regional political events, and acts of war or terrorism and may adversely impact our results of operation. Also the use of hedge instruments may ultimately limit our ability to benefit from favorable commodity prices.

Our businesses are subject to government policies and extensive regulations affecting the beef, pork and poultry industries.

Livestock production and trade flows are significantly affected by government policies and regulations. Government policies affecting the livestock industry, such as taxes, tariffs, duties, subsidies and import and export restrictions on livestock products, can influence industry profitability, the use of land resources, the location and size of livestock production, whether unprocessed or processed commodity products are traded, and the volume and types of imports and exports. Our plants and products are subject to periodic inspections by federal, state and municipal authorities, such as the USDA, the Brazilian Federal Inspection Service (Serviço de Inspeção Federal— SIF) and the Australian Quarantine Inspection Service, and to comprehensive food regulation, including controls over processed food. Our operations are subject to extensive regulation and oversight by state, local and foreign authorities regarding the processing, packaging, storage, distribution, advertising and labeling of its products, including food safety standards. Our failure to comply with such regulations may result in a need to recall products or in fines or other sanctions imposed by such authorities. Our

 

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exported products are often inspected by foreign food safety authorities, and any violation discovered during these inspections may result in a partial or total return of a shipment, partial or total destruction of the shipment and costs due to delays in product deliveries to our customers. For more information about the regulations to which our operations are subject, see “Information about JBS S.A.—Regulation.”

Government policies in the jurisdictions in which we operate may adversely affect the supply of, demand for and prices of livestock products, restrict our ability to do business in existing and target domestic and export markets and could adversely affect our results of operations. Import tariffs and/or other mandates imposed by the current presidential administration in the United States could potentially lead to a trade war with other foreign governments, and could significantly increase the prices on our products exported from the United States, such as pork and chicken. For example, tariffs recently enacted in China and Mexico on certain pork products exported from the United States to these countries have negatively impacted our U.S. exports of pork products. In addition, the U.S., EU or other countries could impose trade restrictions that would restrict or prevent us from exporting beef from Brazil. Such changes in regulations, or restrictions or bans on beef exports, could be imposed in connection with a desire by regulators to curb deforestation in the Amazon region. See “Information about JBS S.A—Regulation.—Cattle Supply Chains and Deforestation.”

Compliance with existing or changing environmental requirements relating to current and/or discontinued operations may result in significant costs, and failure to comply may result in civil liabilities for damages as well as criminal and administrative sanctions.

Our operations are subject to extensive and increasingly stringent federal, state, local and foreign laws and regulations pertaining to the protection of the environment, including those relating to the discharge of materials into the environment, the handling, treatment and disposal of waste and remediation of soil and groundwater contamination. For more information, see “Information about JBS S.A.—Regulation.” Failure to comply with these requirements could have serious consequences for us, including criminal, civil and administrative penalties, claims for property damage, personal injury and damage to natural resources and negative publicity. Our activities may also be affected by future international agreements entered into force to protect the environment.

In general, environmental laws and regulations have become increasingly stringent over time. As a result of possible new environmental requirements, increasingly strict interpretation or enforcement thereof or other unforeseen events, we may have to incur additional expenses in order to comply with such environmental rules and regulations, which may adversely affect our available resources for capital expenditures and other purposes. Compliance with existing or new environmental rules and regulations may increase our costs and expenses, and, as a result, reduce our profit.

Health and environmental impact of animal-based meat consumption could negatively impact consumer demand for our animal-based products.

Consumer interest in plant-based proteins, particularly among millennial and younger generations, has been driven in part by a growing perception of the adverse health and environmental impacts of animal-based meat consumption. Consumers have access to unprecedented levels of information disseminated via the internet and social media channels, and global awareness of these issues may grow and could potentially have a negative impact on consumer demand for our animal-based meat products.

Natural disasters, climate change, climate change regulations, adverse weather conditions and greenhouse effects may adversely impact our operations and markets.

There is a growing political and scientific consensus that emissions of greenhouse gases (“GHG”), continue to alter the composition of the global atmosphere in ways that are affecting the global climate. Climate change, including the impact of global warming, creates physical and financial risk. Physical risks from climate change include an increase in sea level and changes in weather conditions, such as an increase in changes in precipitation

 

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and extreme weather events. Climate change could have a material adverse effect on our results of operations, financial condition and liquidity. Natural disasters, fire, bioterrorism, pandemics, drought, changes in rainfall patterns or extreme weather, including floods, excessive cold or heat, hurricanes or other storms, could impair the health or growth of livestock or interfere with our operations due to power outages, fuel shortages, damage to our production and processing plants, disruption of transportation channels or increases in the price of livestock and animal feed ingredients, among other things. Furthermore, if heat waves and droughts occur with greater frequency and intensity in locations where we maintain livestock, we may have to incur additional expenses to maintain livestock in suitable conditions or move it to other locations. Any of these factors could have a material adverse effect on our financial results, either individually or in the aggregate.

We are subject to legislation and regulation regarding climate change, and compliance with related rules could be difficult and costly. Concerned parties in the countries in which we operate, such as government agencies, legislators and regulators, shareholders and non-governmental organizations, as well as companies in many business sectors, are considering ways to reduce GHG emissions. We could incur increased energy, environmental and other costs and capital expenditures to comply with existing or new GHG limitations. We could also face increased costs related to defending and resolving legal claims and other litigation related to climate change and the alleged impact of our operations on climate change, which may also impact our image.

In addition, growing attention on the environmental and climate change impact of beef production, in particular, could lead (1) to legislative or regulatory actions aimed at reducing the greenhouse gas emissions of cows that could materially increase the production cost of beef or (2) to changes in customer preferences and overall demand for beef that would materially affect consumption of our products.

Efforts to comply with immigration laws and/or the introduction of new immigration legislation could make it more difficult or costly for us to hire employees, as well as have a material adverse effect on our operations and subject us to civil or possible criminal penalties.

Immigration reform continues to attract significant attention among the public and governments in the markets in which we operate, including the United States. If new immigration legislation is enacted or further changes in immigration or work authorization laws could increase our compliance and oversight obligations, which could subject us to additional costs and potential liability and make our hiring process more burdensome, and could potentially reduce the availability of prospective employees. Additional labor costs and other costs of doing business could have a material adverse effect on our business, operating results and financial condition. In addition, despite our efforts to hire only persons legally authorized to work in the jurisdictions in which we operate, we are unable to ensure that all of our employees are persons legally authorized to work. No assurances can be given that enforcement efforts by governmental authorities will not disrupt a portion of our workforce or operations at one or more facilities, thereby negatively impacting our business. Moreover, efforts by governmental authorities in enforcing the law may occur, including civil or possible criminal penalties, and we may face shortages of personnel or interruptions in our operations in one or more plants, resulting in an adverse impact on our business.

We are subject to anti-corruption laws in the jurisdictions in which we operate, including the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act and the Brazil Clean Company Act.

We are subject to a number of anti-corruption laws, including, without limitation, the U.S. Foreign Corrupt Practices Act (the “FCPA”), the U.K. Bribery Act and the Brazil Clean Company Act.

The FCPA and similar anti-bribery laws generally prohibit companies and their intermediaries from making improper payments or improperly providing anything of value to foreign officials, directly or indirectly, for the purpose of obtaining or keeping business and/or other benefits. Some of these laws have legal effect outside the jurisdictions in which they are adopted under certain circumstances. The FCPA also requires maintenance of adequate record-keeping and internal accounting practices to accurately reflect transactions. Under the FCPA, companies operating in the United States may be held liable for actions taken by their strategic or local partners or representatives.

 

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The U.K. Bribery Act is broader in scope than the FCPA in that it directly prohibits commercial bribery (i.e. bribing others than government officials) in addition to bribery of government officials and it does not recognize certain exceptions, notably for facilitation payments, that are permitted by the FCPA. The U.K. Bribery Act also has wide jurisdiction. It covers any offense committed in the United Kingdom, but proceedings can also be brought if a person who has a close connection with the United Kingdom commits the relevant acts or omissions outside the United Kingdom. The U.K. Bribery Act defines a person with a close connection to include British citizens, individuals ordinarily resident in the United Kingdom and bodies incorporated in the United Kingdom. The U.K. Bribery Act also provides that any organization that conducts part of its business in the United Kingdom, even if it is not incorporated in the United Kingdom, can be prosecuted for the corporate offense of failing to prevent bribery by an associated person, even if the bribery took place entirely outside the United Kingdom and the associated person had no connection with the United Kingdom. Other jurisdictions in which we operate have adopted similar anti-corruption, anti-bribery and anti-kickback laws to which we are subject. Civil and criminal penalties may be imposed for violations of these laws.

The Brazil Clean Company Act provides that bribery, among other acts against the public and foreign administration, is illegal and subjects companies involved in these wrongdoings to severe penalties. Companies are subjected to strict liability, with the result that the existence or absence of intent or negligence is irrelevant. In case a company is found to be in violation of the Brazil Clean Company Act’s provisions, it may suffer the imposition of administrative sanctions in the form of a fine that can range from 0.1% to 20% of its gross revenue in the year before the initiation of the administrative proceeding leading to the imposition of sanctions. Companies may also be subject to judicial sanctions, such as: loss of assets, rights or profits directly or indirectly obtained from the wrongdoing; partial suspension or interdiction of its activities; compulsory dissolution of the legal entity; and prohibition from receiving incentives, subsidies, grants, donations or loans from public financial institutions. Furthermore, companies may be subject to reputational penalties, such as having their name included in the National Register of Punished Enterprises. According to the Brazil Clean Company Act, related, controlling and controlled companies as well as companies that are part of a consortium are jointly liable for the penalties, but limited to damages and fines.

The Code of Conduct and Ethics, adopted by JBS S.A. in May 2018 requires our employees or third-parties acting on behalf of JBS S.A. to not make any kind of payments to public or private entities or individuals in order to obtain undue advantages. We operate in some countries which are viewed as high risk for corruption. Despite our ongoing efforts to ensure compliance with the FCPA, the U.K. Bribery Act, the Brazil Clean Company Act and similar laws, there can be no assurance that our directors, officers, employees, agents, representatives, third-party intermediaries and the companies to which we outsource certain of our business operations, will comply with those laws and our anti-corruption policies, and we may be ultimately held responsible for any such non-compliance. If we or our directors or officers violate anti-corruption laws or other laws governing the conduct of business with government entities (including local laws), we or our directors or officers may be subject to criminal and civil penalties or other remedial measures, which could harm our reputation and have a material adverse impact on our business, financial condition, results of operations and prospects. Any investigation of any actual or alleged violations of such laws could also harm our reputation or have an adverse impact on our business, financial condition, results of operations and prospects.

The Brazilian government exercises, and will continue to exercise, significant influence over the Brazilian economy. These influences, as well as the political and economic conditions of the country, could negatively affect our activities.

The Brazilian government frequently intervenes in the country’s economy and occasionally implements significant political and regulatory changes. Government actions to control inflation and other regulations and policies have involved, among other measures, increases or decreases in interest rates, changes in fiscal policy, price control, currency depreciations and appreciations, capital controls, import limits, among other actions. Our activities, as well as our financial condition and results of operations, may be adversely affected by changes in government policies and regulations involving or affecting factors such as:

 

   

monetary policy and interest rates;

 

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exchange controls and restrictions on international remittances;

 

   

exchange rate fluctuations;

 

   

tax changes;

 

   

liquidity of the Brazilian financial and capital markets;

 

   

interest rates

 

   

inflation;

 

   

shortage of energy;

 

   

fiscal policy.

Uncertainties related to the possibility that the Brazilian government may implement future policy and regulatory changes that involve or affect the factors mentioned above, among others, may contribute to a scenario of economic uncertainty in the country and high volatility in the domestic securities market, as well as securities issued by Brazilian companies abroad. This uncertainty and other future events affecting the Brazilian economy, as well as other measures taken by the government, may adversely affect our operations and operational results.

We cannot predict whether or when new fiscal, monetary and exchange policies will be adopted by the Brazilian government, or even whether such policies will in fact affect the country’s economy, operations, financial condition or our results.

Economic and political crises in Brazil may have a material adverse effect on our business, operations and financial condition.

Brazil has been affected by economic instability caused by different economic and political events in recent years, causing a decrease in gross domestic product and affecting supply (investment levels and increase in the use of technology in production, among others) and demand (employment levels and income, among others). As a result, the uncertainty over the Brazilian government’s ability to achieve the economic reforms necessary to improve the deterioration of the public accounts and the economy in general has led to a reduction in market confidence in the Brazilian economy and aggravated the domestic political environment. The Brazilian economy is still influenced by government policies and actions that, if not successful or well implemented, may affect the operations and financial performance of companies, including ours. In the past few years, the Brazilian political environment experienced intense instability due principally to the exposure of a corruption scheme involving various politicians, including highly-ranked politicians, which led to the impeachment of the former president of Brazil and lawsuits against her successor and others. In October 2022, Brazil held elections for President, senators, federal deputies and state deputies. The leading candidates in the Presidential race were incumbent Jair Bolsonaro and former President Luiz Inácio Lula da Silva, representing distinctly opposing political ideologies. Former President Luiz Inácio Lula da Silva was elected President. Post-election unrest could lead to high volatility in Brazilian financial markets, and uncertainty regarding political developments and the policies the Brazilian federal government may adopt or alter may have material adverse effects on the macroeconomic environment in Brazil, as well as on businesses operating in Brazil, including ours. Political and economic instabilities may result in a negative perception of the Brazilian economy and an increase in the volatility of the Brazilian capital markets, which can also adversely affect our business and our common shares. Any recurrent economic instability and political uncertainty may adversely affect our business and have a material adverse effect on us.

 

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CAPITALIZATION

The following table sets forth JBS S.A.’s consolidated loans and financings and total capitalization as of March 31, 2023, as further adjusted to reflect securities issued up to 60 days prior to the date of this prospectus as follows:

 

   

on an actual historical basis, derived from JBS S.A.’s unaudited interim financial statements; and

 

   

as adjusted to give effect to: (1) PPC’s issuance of US$1.0 billion aggregate principal amount of 6.250% senior notes due 2033 in April 2023 (the “PPC 6.250% Notes due 2033”) and the use of net proceeds therefrom (see “Summary—JBS S.A.—Recent Developments—Issuance of PPC’s 6.250% Senior Notes due 2033”); and (2) the Proposed Transaction as if it had been completed on March 31, 2023, including the payment of the Cash Dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00 (equivalent to approximately US$436.6 million, converted using the foreign exchange rate as at March 31, 2023), based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding.

You should read this table in conjunction with “Summary—Summary Historical Financial Data.”Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Description of Material Indebtedness” and JBS S.A.’s financial statements, which are included elsewhere in this prospectus.

 

    As of March 31, 2023  
    Actual     As Adjusted (1)(2)(3)  
    (in millions
of US$)
       

Loans and financings:

   

Total current loans and financings

    1,975.1       1,948.0  
 

 

 

   

 

 

 

Total non-current loans and financings

    16,273.6       16,779.1  
 

 

 

   

 

 

 

Total loans and financing

    18,248.7       18,727.1  
 

 

 

   

 

 

 

Equity:

   

Share capital – JBS S.A.:

   

Common shares, no par value (2,218,116,370 issued and outstanding shares)

    13,177.8       —    

Share capital – JBS N.V.:

   

Class A common shares, par value €0.01 per share (811,197,463 issued and outstanding shares) (4)

    —         8.8  

Class B common shares, par value €0.10 per share (297,860,722 issued and outstanding shares)

    —         32.4  

Capital reserve

    (191.9     12,944.7  

Other reserves

    (35.5     (35.5

Profit reserves

    4,299.7       3,863.1  

Accumulated other comprehensive income

    (8,147.5     (8,147.5

Retained earnings (loss)

    (279.3     (279.3

Attributable to company shareholders

    8,823.3       8,386.7  

Attributable to non-controlling interest

    638.2       638.2  
 

 

 

   

 

 

 

Total equity

    9,461.5       9,024.9  
 

 

 

   

 

 

 

Total capitalization (5)

    27,710.2       27,752.0  
 

 

 

   

 

 

 

 

(1)

Gives effect to the issuance of the PPC 6.250% Notes due 2033 and the use of net proceeds therefrom. In April 2023, PPC issued US$1.0 billion aggregate principal amount of 6.250% senior notes due 2033 at an offering price to the public of 99.312% per note, from which it received US$983.1 in net proceeds (after deducting underwriting fees and other expenses). PPC used the net proceeds from the offering of the notes to repay the outstanding term loans under its U.S. credit facility in the aggregate amount of US$504.6 million (US$27.1 million of current loans and financing and US$477.5 million of noncurrent loans and financing).

(2)

Assumes the shareholding structure of JBS S.A. immediately prior to the Proposed Transaction will be the same as its shareholding structure as of June 30, 2023, none of the Eligible Shareholders or LuxCo requests to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion

 

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  Period. If all Eligible Shareholders request to convert 100% of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, following which a number of JBS N.V. Class A Common Shares are converted into JBS N.V. Class B Common Shares, subject to the Minimum Free Float requirement, and LuxCo requests to convert all of its JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period (and none of the JBS N.V. Class B Common Shares are reconverted into JBS N.V. Class A Common Shares), then the share capital of Class A common shares, par value €0.01 per share (221,811,637 issued and outstanding shares) would be US$2.4 million the share capital of Class B common shares, par value €0.10 per share (887,246,548 issued and outstanding shares) would be US$96.5 million and the balance of the capital reserve account would be US$12,887.0. The remainder of the equity account balances are not affected by the results of the conversion of JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period.
(3)

Gives effect to the payment of the Cash Dividend in connection with the Proposed Transaction. The Cash Dividend is estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00 (equivalent to approximately US$436.6 million, converted using the foreign exchange rate as at March 31, 2023), based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding.

(4)

Pertains to the JBS N.V. Class A Common Shares underlying the JBS N.V. BDRs to be issued in connection with the Proposed Transaction.

(5)

Total capitalization is the sum of total loans and financings and total equity. There is no standard definition of total capitalization, and JBS S.A.’s definition of total capitalization may not be comparable to those used by other companies.

 

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PER SHARE, DIVIDEND AND MARKET PRICE DATA

Per Share Data

The following table set forth, for each of the periods indicated, certain per share data of JBS S.A. on a historical basis and JBS N.V. on a pro forma basis. The pro forma per share data gives effect to the Proposed Transaction as it had occurred on January 1, 2020. This data has been derived from, and should be read together with JBS S.A.’s audited financial statements.

This pro forma per share data is being provided for illustrative purposes only and is not necessarily indicative of the results that would have been achieved had the Proposed Transaction been completed during the periods presented, nor are they necessarily indicative of the results of operations or financial condition that may be expected for any future period or date. You should not rely on the pro forma information as being indicative of the historical results that would have occurred or the future results that we will experience after the Proposed Transaction. We may have performed differently had the Proposed Transaction occurred prior to the periods presented.

 

    As of and for the three-month
period ended March 31,
    As of and for the year ended December 31,  
    2023     2022     2022     2021     2020 (1)  
   

(in US$, except as otherwise indicated)

 

JBS S.A. (Historical)

         

Net income attributable to company shareholders (in millions of
US$)

    (279.6     982.7       2,997.4       3,811.4       623.4  

Weighted average common shares outstanding:

         

Basic and diluted (1)

    2,218,116,370       2,249,723,468       2,230,412,209       2,479,190,279       2,655,093,897  

Earnings per share:

         

Basic and diluted (2)

   
(0.13

    0.44       1.34       1.54       0.23  

Total equity (in millions of US$)

   
9,461.5
 
      9,546.1       8,565.0       8,379.2  

Common shares outstanding

   
2,218,116,370
 
      2,218,116,370       2,373,866,570       2,623,373,646  

Book value per share (3)

   
4.27
 
      4.30       3.61       3.19  

JBS N.V. (Pro forma)

         

Pro forma net income attributable to company shareholders (in millions of US$)

   
(279.6

    982.7       2,997.4       3,811.4       623.4  

Pro forma weighted average common shares outstanding:

         

Basic and diluted (4)

   
1,109,058,185
 
    1,124,861,734       1,115,206,104       1,239,595,139       1,327,546,948  

Pro forma earnings per share:

         

Basic and diluted (5)

   
(0.25

    (0.87     2.69       3.08       0.47  

Pro forma total equity (in millions of US$)

    9,461.5         9,546.1       8,565.0       8,379.2  

Pro forma common shares outstanding (6)

    1,109,058,185         1,109,058,185       1,186,933,285       1,311,686,823  

Pro forma book value per share (7)

    8.53         8.61       7.22       6.39  

 

(1)

The difference between the historical basic and diluted weighted average number of JBS S.A. Common Shares outstanding is immaterial. For more information about the historical basic and diluted weighted average number of JBS S.A. Common Shares outstanding, see note 24 to JBS S.A.’s audited financial statements, which are included elsewhere in this prospectus.

 

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(2)

Calculated by dividing (i) net income (loss) during the period attributable to company shareholders by (ii) the weighted average number of JBS S.A. Common Shares outstanding.

(3)

Calculated by dividing (i) total equity by (ii) the number of JBS S.A. Common Shares outstanding.

(4)

Calculated by dividing (i) the historical weighted average number of JBS S.A. Common Shares outstanding by (ii) two, to reflect the expectation that holders of JBS S.A. Common Shares will receive one JBS N.V. BDR for every two JBS S.A. Common Shares held, excluding common shares purchased and held as treasury shares.

(5)

Calculated by dividing (i) pro forma net income (loss) during the period attributable to company shareholders by (ii) the pro forma weighted average number of common shares outstanding calculated as described in footnote (4) above.

(6)

Calculated by dividing (i) the number of JBS S.A. Common Shares outstanding by (b) two, to reflect the expectation that for holders of JBS S.A. Common Shares will receive one JBS N.V. BDR for every two JBS S.A. Common Shares held, disregarding fractional BDR entitlements.

(7)

Calculated by dividing (i) pro forma total equity by (ii) the pro forma number of common shares outstanding calculated as described in footnote (6) above.

Historical Dividend Data

JBS N.V.

Since its incorporation on October 9, 2019, the issuer has not declared or paid any dividends. For more information about the issuer’s dividend policy expected to be in place on the Closing Date, see “Description of Share Capital—Dividend Rights.”

JBS S.A.

JBS S.A.’s bylaws require the payment of dividends of at least 25% of the annual net income attributable to company shareholders calculated in accordance with Brazilian law. JBS S.A. recognizes a liability at year-end for the minimum unpaid yearly dividend amount up to the limit of the mandatory minimum dividend. Dividends payables are recognized as a liability at December 31 of each year.

The table below sets forth the dividends distributed and dividends per share for the periods indicated:

 

     For the year ended December 31,  
     2022      2021      2020  

Dividends distributed (in millions of US$)

     872.8        875.3        483.2  

Number of outstanding shares (common shares)

     2,218,116,370        2,373,866,570        2,623,373,646  

Dividends per share (in US$)

     0.39        0.37        0.18  

For more information about the comparative dividend policies of JBS N.V. and JBS S.A., see “Description of Share Capital—Comparison of the Rights of Holders of JBS N.V. Shares and JBS S.A. Common Shares—Dividends.”

Historical Per Share Market Data

JBS N.V.

JBS N.V.’s common shares are not listed on any stock exchange and are not traded in an organized market. Therefore, no historical market data is available.

JBS S.A.

The principal trading market for the JBS S.A. Common Shares is the B3, where they are traded under the symbol “JBSS3”. The JBS S.A. Common Shares began trading on the B3 on March 29, 2007. On December 4, 2008, the JBS S.A. ADSs began trading on the OTCQX market in the United States under the symbol “JBSAY”.

 

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The table below sets forth the high and low closing sales prices and the approximate average daily trading volume for the JBS S.A. Common Shares on the B3 and the high and low closing sales prices and the approximate average daily trading volume for the JBS S.A. ADSs on the OTCQX market for the periods indicated. The closing prices per share of the JBS S.A. Common Shares on the B3 and the JBS S.A. ADSs on the OTCQX on July 11, 2023 (the date preceding the public announcement of the Proposed Transaction) were R$17.24 and US$7.17, respectively.

 

     B3      OTCQX  
     Closing Price per
JBS S.A.
Common Share
     Average Daily
Trading
Volume
     Closing Price per
JBS S.A. ADS
     Average Daily
Trading
Volume
 
   High      Low      High      Low  
     (in Brazilian
reais)
     (in number of
shares)
     (in U.S. dollars)      (in number of
ADSs)
 

2018

     12.20        8.14        8,640,608        6.41        4.33        130,713  

2019

     33.20        12.04        11,449,189        15.96        6.40        126,075  

2020

     30.09        16.75        18,483,846        14.21        6.45        178,849  

2021

     39.05        23.41        12,781,412        14.20        8.82        92,931  

2022

     39.03        20.24        8,975,527        16.69        7.72        154,359  

2020

                 

First Quarter

     30.09        16.75        18,667,358        14.21        6.45        225,006  

Second Quarter

     25.25        19.00        20,219,321        9.59        7.26        221,896  

Third Quarter

     24.61        20.36        16,915,815        9.03        7.28        127,754  

Fourth Quarter

     24.06        19.11        18,232,702        9.36        6.78        142,856  

2021

                 

First Quarter

     30.28        23.41        14,357,573        10.50        8.82        85,346  

Second Quarter

     35.46        28.11        12,611,776        12.97        10.59        111,185  

Third Quarter

     37.38        28.62        12,509,805        13.82        10.95        97,900  

Fourth Quarter

     39.05        33.41        11,688,472        14.20        11.81        77,223  

2022

                 

First Quarter

     38.68        33.87        10,453,674        15.93        12.59        190,861  

Second Quarter

     39.03        31.59        9,572,194        16.69        12.10        99,867  

Third Quarter

     33.18        25.12        7,608,755        12.64        9.36        103,624  

Fourth Quarter

     27.80        20.24        8,323,095        10.50        7.72        223,602  

2023

                 

First Quarter

     22.88        17.85        10,115,061        8.81        6.98        264,740  

Most Recent Six Months

                 

December 2022

     22.22        20.24        8,091,929        8.55        7.72        382,235  

January 2023

     22.88        20.08        7,560,664        8.81        7.72        272,337  

February 2023

     20.11        17.91        11,728,589        8.05        7.15        264,209  

March 2023

     20.49        17.85        11,012,217        7.84        7.17        269,687  

April 2023

     17.90        16.59        9,384,839        7.11        6.57        217,862  

May 2023

     18.28        16.14        14,644,245        7.31        6.45        211,396  

June 2023

     19.34        16.34        13,658,755        7.98        6.50        151,222  

 

Source: Bloomberg

 

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JBS S.A. GENERAL MEETING

JBS N.V. is providing this prospectus to JBS S.A. Shareholders in advance of the JBS S.A. General Meeting that will be called for the purpose of approving the Proposed Transaction. This prospectus contains information that you need to know about the Proposed Transaction and the proposals to be voted on at the JBS S.A. General Meeting, in order to be able to vote or instruct your vote, as applicable, at the JBS S.A. General Meeting.

Date, Time and Place of the JBS S.A. General Meeting

The JBS S.A. General Meeting to consider the Proposed Transaction is scheduled to be held on                 , 2023 at:                  a.m./p.m. (São Paulo time) at JBS S.A.’s headquarters, in the City of São Paulo, at Avenida Marginal Direita do Tietê, 500, Bloco I, 3º andar, CEP 05118-100.

Agenda of the JBS S.A. General Meeting

The JBS S.A. General Meeting will consider and vote on the following matters:

(1) the Merger of Shares, including ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as further discussed under “Related Party Transactions—Transaction Documents—Merger of Shares Protocol”;

(2) the Delisting; and

(3) the Cash Dividend.

If any of the matters above are not approved, the Proposed Transaction will not be concluded.

Quorum for Installation

The JBS S.A. General Meeting will be installed on first call if attended by shareholders representing collectively 1/4 of the outstanding capital stock of JBS S.A. If the attendance requirement is not met for the JBS S.A. General Meeting on first call, the JBS S.A. General Meeting will be reconvened at a date and time at least eight calendar days after the date and time scheduled for the JBS S.A. General Meeting on first call. The JBS S.A. General Meeting may be installed on second call with any percentage of holders present at the meeting following the second call. Although the controlling shareholders will be counted for quorum purposes to install the JBS S.A. General Meeting and the shares held by our controlling shareholders will be sufficient to establish a quorum, the JBS S.A. General Meeting will not be held if no non-controlling shareholders participate because the Proposed Transaction cannot be approved without participation by non-controlling shareholders. As described below under “—Required Vote,” all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting.

Required Vote

(1) Merger of Shares. The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as described above under the caption “—Agenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares.

(2) Delisting. The Delisting requires the affirmative vote of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. Accordingly, our controlling shareholders will not be entitled to vote on this matter.

 

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(3) Cash Dividend. The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting.

Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. A majority of the JBS S.A. Free Float Outstanding represents approximately 25% of the total issued and outstanding JBS S.A. Common Shares as of June 30, 2023. However, since certain matters being voted on at the JBS S.A. General Meeting (such as the Merger of Shares) must be approved by a majority of the total outstanding JBS S.A. Common Shares, it is possible that the Proposed Transaction may be approved by non-controlling shareholders representing as little as 1.2% of the total JBS S.A. Common Shares issued and outstanding (which combined with the 48.83% of the issued and outstanding JBS S.A. Common Shares held by our controlling shareholders as of June 30, 2023 amount to a majority of the JBS S.A. Common Shares outstanding). See “Risk Factors— Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.

Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters.

The directors and executive officers of JBS S.A. collectively hold less than 1% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023. One of the directors of JBS S.A., José Batista Sobrinho, is the father of our ultimate controlling shareholders.

Shareholders Entitled to Attend the JBS S.A. General Meeting and to Vote

JBS S.A. Shareholders on the date of the JBS S.A. General Meeting are entitled to attend the JBS S.A. General Meeting and vote on the items set forth on the agenda, as long as they have timely provided the appropriate documentation required by JBS S.A. at the time of the call notice to the JBS S.A. General Meeting, which required documentation will be set out in the notice of the JBS S.A. General Meeting and/or in the documents relating thereto. There is no record date for purposes of determining direct JBS S.A. Shareholders entitled to attend the JBS S.A. General Meeting or to vote. JBS S.A. Shareholders wishing to authorize a proxy to vote their JBS S.A. Common Shares may do so by following the instructions which will be available in the notice of the JBS S.A. General Meeting and/or in the documents relating thereto. To be valid, the proxy must be appointed less than one year before the JBS S.A. General Meeting. For legal entities that hold JBS S.A. Common Shares, any proxy duly constituted in accordance with applicable law and such legal entities’ corporate documents may represent the shareholder at the JBS S.A. General Meeting. However, an investment fund must be represented by its investment fund officer. For individuals who hold JBS S.A. Common Shares, the proxy must be either a shareholder, an executive officer or board member of JBS S.A., a lawyer or a financial institution.

To participate in the JBS S.A. General Meeting you will need to review the information included on the notice of the JBS S.A. General Meeting and in the documents relating thereto.

No Solicitation of Proxies from JBS S.A. Shareholders

Please note that this document is not a proxy or solicitation of votes for the JBS S.A. General Meeting or any shareholders’ meeting of JBS S.A., HoldCo or a general meeting of shareholders of JBS N.V. that will be held in connection with the Proposed Transaction.

 

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Manner of Voting

JBS S.A. Shareholders may exercise their voting rights at the JBS S.A. General Meeting by voting in person or by proxy during the meeting or by using distance vote ballots (boletim de voto a distância). In such ballots shareholders convey their vote to JBS S.A. directly or their voting instructions for the completion of the ballot of remote vote through the respective custodian agents, in case they provide said services.

The service of collection and transmission of instructions and completion of vote may also be provided by Banco Bradesco S.A., bookkeeping agent of the stocks issued by JBS S.A.

JBS S.A. Shareholders are allowed to exercise their voting rights by means of the distance vote ballots directly and by sending the identification documents to JBS S.A. (ri@jbs.com.br).

The distance vote ballots, accompanied by the respective documentation, shall be considered solely in case they are received by JBS S.A., in order, within up to seven days before the date of the JBS S.A. General Meeting. According to the provisions set forth in CVM regulations, JBS S.A. shall inform JBS S.A. Shareholders whether the documents received are sufficient so that the vote is considered valid, or the procedures and terms for possible rectification or resend, as necessary.

 

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THE PROPOSED TRANSACTION

The following is a description of the material aspects of the Proposed Transaction. This section does not purport to be complete and may not contain all of the information that is important to you. You should carefully read this entire prospectus, including the full text of the Merger of Shares Protocol, forms of which are included as exhibits to the registration statement of which this prospectus is a part, for a more complete understanding of the Proposed Transaction. All descriptions in this summary and in this prospectus of the terms and conditions of the Proposed Transaction are qualified in their entirety by reference to the Merger of Shares Protocol. In addition, important business and financial information about each of JBS N.V. and JBS S.A. is included in this prospectus and exhibits to the registration statement of which this prospectus is a part.

Overview

The Proposed Transaction is part of a proposed corporate restructuring of the JBS Group with the purpose of listing shares on the NYSE and BDRs on the B3 that represent equity of JBS N.V. Currently, JBS S.A. Common Shares are listed on the B3 and JBS S.A. ADSs trade over-the-counter in the U.S. Upon completion of the Proposed Transaction, we expect to list JBS N.V. Class A Common Shares on the NYSE, to list JBS N.V. BDRs on the B3 and to delist JBS S.A. Common Shares from the Novo Mercado listing segment of the B3. In addition, the JBS S.A. ADS Program will be terminated prior to the JBS S.A. General Meeting. See “—JBS S.A. ADS Program” for additional information regarding the treatment of JBS S.A. ADS Holders in the Proposed Transaction.

JBS B.V. is a private limited liability company (besloten vennootschap met beperkte aansprakelijkheid) under Dutch law, with its corporate seat (statutaire zetel) in Amsterdam, the Netherlands. Prior to the Closing Date, JBS B.V. will be converted into a public limited liability company (naamloze vennootschap) under Dutch law, with the name “JBS N.V.” As of the date of this prospectus, the issuer is a wholly-owned subsidiary of JBS S.A. and has no revenues or business operations or material assets, liabilities or contingencies. JBS S.A. intends to transfer the issuer to LuxCo prior to the first step of the Restructuring.

As the first step in the Restructuring, prior to the Closing Date, JBS N.V. will, through a series of transactions, become the indirect controlling shareholder of JBS S.A. On July 7, 2023, our controlling shareholders entered into a binding and unconditional agreement with JBS N.V., HoldCo and LuxCo pursuant to which: (1) JBS S.A.’s controlling shareholders will contribute and transfer all of their JBS S.A. Common Shares at book value to LuxCo; (2) immediately thereafter, LuxCo will contribute and transfer all such JBS S.A. Common Shares at book value to JBS N.V. in exchange for 243,704,227 JBS N.V. Class A Common Shares and 297,860,722 JBS N.V. Class B Common Shares (whereby the difference in the value of the JBS S.A. Common Shares and the aggregate nominal value of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will be added to the general share premium reserve maintained by JBS N.V.); and (3) immediately thereafter, JBS N.V. will contribute and transfer all of its shares of JBS S.A. at book value to HoldCo in exchange for common shares of HoldCo. These transactions and transfers of equity interests must be consummated and completed no later than December 31, 2023. As a result of this step, JBS N.V. will, through HoldCo, indirectly hold the shares of JBS S.A. that are currently held directly by JBS S.A.’s controlling shareholders. Accordingly, JBS N.V. will become the indirect controlling shareholder of JBS S.A. This step will be subject to the same exchange ratio of one JBS N.V. Common Share for every two JBS S.A. Common Shares that will be applied to JBS S.A.’s non-controlling shareholders pursuant to the Merger of Shares and Redemption, which will result in each JBS S.A. shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V., the voting power of our controlling shareholders (held indirectly,

 

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through LuxCo) may increase substantially in relation to our non-controlling shareholders as a result of the aforementioned steps, depending on the number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares during the Class A Conversion Period.

Immediately following the first step in the Restructuring and conversion of JBS B.V. into JBS N.V., our corporate structure will be the following (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023):

 

 

LOGO

The Proposed Transaction is the second and final step in the Restructuring. The completion of the Proposed Transaction is expected to occur on or about                  business days after the JBS S.A. General Meeting and the HoldCo General Meeting, subject to the satisfaction of certain conditions described in this prospectus. The Proposed Transaction will consist of the three steps below:

 

   

Merger of Shares. Subject to approval at the JBS S.A. General Meeting, on the Closing Date, the Merger of Shares will be implemented through an incorporação de ações under the Brazilian Corporation Law. Pursuant to the Merger of Shares, every two JBS S.A. Common Shares issued and outstanding on the Last Trading Day that are not held by HoldCo will be automatically contributed for their book value into HoldCo in exchange for one HoldCo Redeemable Share, determined pursuant to the Exchange Ratio, and JBS S.A. will become a wholly-owned subsidiary of HoldCo. The HoldCo Redeemable Shares are mandatorily redeemable for JBS N.V. BDRs.

 

   

Redemption. Immediately after the Merger of Shares is approved at the JBS S.A. General Meeting, JBS N.V., as sole shareholder of HoldCo, will approve at the HoldCo General Meeting the redemption of all of the HoldCo Redeemable Shares and deliver to each holder thereof one JBS N.V. BDR for every

 

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one HoldCo Redeemable Share held. If such holder wants to receive the underlying JBS N.V. Class A Common Shares, the JBS N.V. BDRs may be cancelled at any time, and from time to time, on or after about two business days after the Closing Date.

 

   

Cash Dividend. Subject to approval at the JBS S.A. General Meeting, all JBS S.A. Shareholders (including our controlling shareholders) who hold JBS S.A. Common Shares on the date of the JBS S.A. General Meeting will be entitled to receive a Cash Dividend estimated, at current market conditions, at R$1.00 per JBS S.A. Common Share held. The aggregate amount of the Cash Dividend is R$2,218,116,370.00, based on 2,218,116,370 JBS S.A. Common Shares issued and outstanding. The Cash Dividend will be paid following the approval of the Proposed Transaction at the JBS S.A. General Meeting, at a date to be disclosed to the market in due course.

Immediately following the completion of the Proposed Transaction, our corporate structure will be the following (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023 and not considering the effects of the Conversion):

 

 

LOGO

 

(1)

To be held in the form of BDRs immediately following the completion of the Proposed Transaction.

For information about the effects of the Conversion on our corporate structure, see “—Class A Conversion Period” below.

 

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In connection with the Proposed Transaction, HoldCo may be required to withhold and collect Brazilian taxes imposed on capital gains assessed, if any, due by certain non-Brazilian JBS S.A. Shareholders that hold their investment under the special tax regime of CMN Resolution No. 4,373/2014 (“4,373 Holders”). In order to determine whether any withholding will be required, each 4,373 Holder must report, through its Brazilian custodian or broker dealer, certain information relating to such 4,373 Holder’s historical cost and tax domiciliation. Such information must be provided after the JBS S.A. General Meeting, in accordance with the procedures that will be publicly announced prior to the date of the JBS S.A. General Meeting. If HoldCo determines based on such information that withholding will be required, or if such 4,373 Holder fails to provide such information, HoldCo has the right, at its sole discretion, to: (1) deduct any amount required to be withheld by HoldCo from the Cash Dividend payable by JBS S.A. to such 4,373 Holder; and (2) retain JBS N.V. BDRs which such 4,373 Holder is entitled to receive, in an amount sufficient to generate cash payment sufficient to cover any required tax withholding, and HoldCo will retain such amount upon sale of such BDRs. See “Material Tax Considerations—Material Brazilian Tax Considerations.”

Immediately following the completion of the Proposed Transaction:

 

   

JBS S.A. will be an indirect wholly owned subsidiary of JBS N.V.

 

   

The business conducted by the JBS Group will be the same as prior to the Proposed Transaction.

 

   

You will become a shareholder of JBS N.V. (initially through the holding of JBS N.V. BDRs, which can be cancelled to allow direct interest in JBS N.V. through holding JBS N.V. Class A Common Shares).

 

   

The shareholders of JBS N.V. will be the same as the shareholders of JBS S.A. on the Last Trading Day, and on the Closing Date, our controlling shareholders will (indirectly, through LuxCo) hold an aggregate number of JBS N.V. Class B Common Shares and JBS N.V. Class A Common Shares that represents the same economic interest in JBS N.V. as our controlling shareholders have in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to shareholders of JBS S.A. resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V. (each JBS N.V. Class A Common Share is entitled to one vote at a general meeting of shareholders JBS N.V. and each JBS N.V. Class B Common Share is entitled to 10 votes at a general meeting of shareholders JBS N.V.), the voting power of the ultimate controlling shareholders will increase from 48.83% to 85.03% (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023).

 

   

Our ultimate controlling shareholders will continue to control the JBS Group’s business through the indirect ownership of JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares representing 85.03% of the voting power in JBS N.V. (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023), which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V.

 

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Currently, JBS S.A. Common Shares are listed on the B3. Upon completion of the Proposed Transaction, we expect to list JBS N.V. Class A Common Shares on the NYSE and to list JBS N.V. BDRs on the B3. Upon completion of the Proposed Transaction, the JBS S.A. Common Shares will no longer be listed on the B3 or any other exchange. JBS S.A. will become a wholly owned subsidiary of HoldCo.

Immediately upon completion of the Proposed Transaction, our controlling shareholders will own (indirectly, through LuxCo) 100% of the issued and outstanding JBS N.V. Class B Common Shares and 30.04% of the issued and outstanding JBS N.V. Class A Common Shares, which will in the aggregate represent a majority of the voting power in the general meeting of shareholders of JBS N.V., and will effectively control all matters requiring shareholder approval. Assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023, immediately upon completion of the Proposed Transaction, our controlling shareholders will (indirectly, through LuxCo) hold 48.83% of the then-outstanding JBS N.V. Common Shares and 85.03% of the aggregate voting power in JBS N.V, which will represent an increase in their aggregate voting power from the 48.83% voting power in JBS S.A. they held as of June 30, 2023. Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS N.V. Class A Common Shares successfully undertake conversions during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. The exact percentage of the then-outstanding JBS N.V. shares and aggregate voting power in JBS N.V. that will be held (indirectly) by our controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the percentage of JBS S.A. shares that they hold on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

The charts above do not contain JBS S.A.’s subsidiaries. For a complete chart containing JBS S.A.’s subsidiaries, see “Information about JBS S.A.—Corporate Structure.”

Exchange Ratio

The Exchange Ratio means the number of HoldCo Redeemable Shares that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) will receive per JBS S.A. Common Share in consideration for the Merger of Shares. The Exchange Ratio has been established so that each JBS S.A. Shareholder (excluding the controlling shareholders, through HoldCo) receives, upon completion of the Proposed Transaction, one JBS N.V. BDR for every two JBS S.A. Common Shares that it holds. On the Closing Date, JBS S.A. Shareholders (excluding the controlling shareholders, through HoldCo) will receive one HoldCo Redeemable Share for every two JBS S.A. Common Shares it holds on the Last Trading Day. Immediately thereafter, each HoldCo Redeemable Share will be redeemed in exchange for one JBS N.V. BDR. Prior to the completion of the Proposed Transaction, our controlling shareholders (through LuxCo) will have received one JBS N.V. Class A Common Share or one JBS N.V. Class B Common Share for every two JBS S.A. Common Shares held. This will result in each JBS S.A. Shareholder on the Last Trading Day receiving the same economic interest in the total capital of JBS N.V. as such JBS S.A. Shareholder had in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to JBS S.A. Shareholders resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.”

Opening Price

The opening price of the JBS N.V. BDRs on the B3 will be equivalent to the closing price of the JBS S.A. Common Shares on the Last Trading Day, as adjusted by the Exchange Ratio. We expect that the opening price of

 

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the JBS N.V. Class A Common Shares on the NYSE will be determined by buy and sell orders collected by the NYSE from broker-dealers. Based on such orders, the designated market maker will determine an opening price for the JBS N.V. Class A Common Shares. However, prior to the opening trade, there will not be a price at which underwriters initially sell the JBS N.V. Class A Common Shares to the public as there would be in a traditional underwritten initial public offering. The absence of a predetermined initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, upon listing on the NYSE, the public trading price of the JBS N.V. Class A Common Shares may be more volatile than in a traditional underwritten initial public offering and could decline significantly and rapidly. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.

Treatment of Fractional JBS N.V. BDRs

Following the Closing Date, any fractional JBS N.V. BDRs attributed to JBS S.A. Shareholders resulting from the Merger of Shares and the Redemption will be grouped into whole numbers and sold on the open market managed by B3, as applicable. The net proceeds from the sale of the fractional JBS N.V. BDRs will be distributed on a pro rata basis to the former JBS S.A. Shareholders who contributed their JBS S.A. Common Shares to HoldCo in the Merger of Shares. Excluding the Cash Dividend, no additional consideration in cash or in kind will be paid to JBS S.A. Shareholders in connection with the Proposed Transaction.

Receiving JBS N.V. Class A Common Shares

Holders of JBS S.A. Common Shares on the Last Trading Day shall initially receive JBS N.V. BDRs in connection with the Proposed Transaction because, pursuant to the rules of the B3, they are required to receive a Brazilian security in connection with the Merger of Shares and the Redemption. However, at any time, and from time to time, on or after about two business days after the Closing Date, a holder of JBS N.V. BDRs that wants to receive JBS N.V. Class A Common Shares may request the cancellation of all or a portion of its JBS N.V. BDRs by: (1) instructing its broker or custodian operating in Brazil to cancel its JBS N.V. BDRs with the JBS N.V. BDR Depositary Bank; and (2) delivering evidence that all fees and potential taxes due in connection with this service were duly paid, as set forth in the JBS N.V. BDR Deposit Agreement. The cancellation instruction to the broker or custodian must include an appropriate brokerage account outside of Brazil to receive the underlying JBS N.V. Class A Common Shares. Holders may also be able to hold JBS N.V. Class A Common Shares on the books of our registrar and transfer agent. Holders who choose to hold their JBS N.V. Class A Common Shares on the books of our registrar and transfer agent will receive a statement by regular mail indicating their position and must comply with the procedures established by our registrar and transfer agent before they can transfer or convert their shares.

Class A Conversion Period

The Class A Conversion Period means a period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026, during which each Eligible Shareholder may request, after having cancelled such JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares, which we refer to as the Maximum Convertible Shares, equals the number of JBS N.V. BDRs to which such Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction).

 

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In order to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares, Eligible Shareholders must first cancel the JBS N.V. BDRs they received in connection with the Proposed Transaction for receipt of the underlying JBS N.V. Class A Common Shares. See “—Receiving JBS N.V. Class A Common Shares” above.

Once they receive their JBS N.V. Class A Common Shares, Eligible Shareholders or LuxCo, as the case may be, must then provide a written request to our board of directors (“Class A Conversion Request”) during the Class A Conversion Period. The Class A Conversion Request must:

 

  (1)

indicate the number of JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains, provided the maximum number of JBS N.V. Class A Common Shares in respect of which an Eligible Shareholder may request conversion equals the number of JBS N.V. BDRs to which the Eligible Shareholder was entitled at 10 a.m. São Paulo time on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction), and the maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date;

 

  (2)

in the case of Eligible Shareholders, if such Eligible Shareholder is not registered in the shareholders’ register of JBS N.V., include a confirmation from the requesting shareholder’s broker that such shareholder holds a beneficial interest in the number of JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains;

 

  (3)

in the case of Eligible Shareholders, include a document issued by Banco Bradesco S.A. as depositary of the JBS N.V. BDRs, confirming (i) that such Eligible Shareholder qualifies as Eligible Shareholder and (ii) the number of JBS N.V. BDRs held by such Eligible Shareholder at the opening of trading on the Conversion Record Date; and

 

  (4)

include an undertaking by the requesting shareholder to not transfer the JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains, from the date on which the Class A Conversion Request is provided to the board of directors until (and including) the day on which the JBS N.V. Class A Common Shares to which the Class A Conversion Request pertains are converted into JBS N.V. Class B Common Shares.

Once they have sent their Class A Conversion Request to our board of directors, Eligible Shareholders or LuxCo, as the case may be, will not be able to rescind such request. If they wish to receive JBS N.V. Class A Common Shares after having submitted a Class A Conversion Request, they must wait until their JBS N.V. Class A Common Shares are converted into JBS N.V. Class B Common Shares and follow the procedures to convert their JBS N.V. Class B Common Shares back into JBS N.V. Class A Common Shares pursuant to the procedures established in our articles of association. See “Description of Share Capital—Conversion—Class B Common Shares into Class A Common Shares.”

Except with respect to conversion requests submitted during the Last Conversion Quarter, the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to the Maximum Conversion Rate of 55% of such Eligible Shareholder’s Maximum Convertible Shares. During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the Last Conversion Quarter (i.e., the fourth quarter of 2026), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float of 20%, the number of JBS

 

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N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

For every successful conversion request made, our board of directors will resolve to: (1) convert the aggregate number of JBS N.V. Class A Common Shares in respect of which they have received, during the Class A Conversion Period, one or more Class A Conversion Requests satisfactory to them into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share, subject to the Maximum Conversion Rate and the Minimum Free Float requirement; and (2) pay up the difference between the aggregate nominal value of the JBS N.V. Class A Common Shares to which the Class A Conversion Requests pertain (taking into consideration the Maximum Conversion Rate and the Minimum Free Float requirement) and the aggregate nominal value of the JBS N.V. Class B Common Shares into which the JBS N.V. Class A Common Shares are converted at the charge of the general share premium reserve maintained by JBS N.V.

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which LuxCo may request to convert into JBS N.V. Class B Common Shares equals the number of JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date. For the avoidance of doubt, the Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes.

In the case of Class A Conversion Request(s) received from LuxCo, for every successful conversion request made, our board of directors will, within          business days after receiving such request, resolve to: (1) convert the aggregate number of JBS N.V. Class A Common Shares in respect of which they have received such request satisfactory to them into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share; and (2) pay up the difference between the aggregate nominal value of the JBS N.V. Class A Common Shares to which such requests pertain and the aggregate nominal value of the JBS N.V. Class B Common Shares into which the JBS N.V. Class A Common Shares are converted at the charge of the general share premium reserve maintained by JBS N.V.

Once our board of directors resolves on the conversions described above, we will instruct our registrar and transfer agent to register the JBS N.V. Class B Common Shares on their books. Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be. Following the end of each fiscal quarter, JBS N.V. will disclose to the market the number of JBS N.V. Class A Common Shares that were converted into JBS N.V. Class B Common Shares pursuant to the procedures described above.

Following the Class A Conversion Period, JBS N.V. Class A Common Shares will no longer be convertible into JBS N.V. Class B Common Shares, but JBS N.V. Class B Common Shares will remain convertible into JBS N.V. Class A Common Shares and JBS N.V. Conversion Shares upon (i) a resolution by the board of directors following delivery of a conversion request to the board of directors, or (ii) automatically upon the enforcement of

 

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a security interest over such JBS N.V. Class B Common Share (including, but not limited to, a right of pledge), which results in a transfer of such JBS N.V. Class B Common Share. The JBS N.V. Conversion Shares are introduced to facilitate a 1:1 conversion of JBS N.V. Class B Common Shares into JBS N.V. Class A Common Shares under Dutch law. For more information, see “Description of Share Capital—Conversion.”

The following tables set forth our corporate structure immediately following the Class A Conversion Period considering various conversion scenarios, assuming the shareholding structure of JBS S.A. immediately prior to the Proposed Transaction will be the same as its shareholding structure as of June 30, 2023, any JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period will not be reconverted into JBS N.V. Class A Common Shares, and there will be no additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

Scenario 1: None of the Eligible Shareholders request to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares

(a) LuxCo requests to convert all of its JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares:

 

Shareholder

   Shares Outstanding     % Voting
Power
 
     Class A common shares     Class B common shares     Total        
     Shares      %     Shares      %     Shares      %        

LuxCo

     —          —         541,564,949        100.00     541,564,949        48.83     90.52

Other shareholders

     567,493,236        100.00     —          —         567,493,236        51.17     9.48
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

     567,493,236        100.00     541,564,949        100.00     1,109,058,185        100.00     100.00
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

(b) LuxCo requests to convert none of its JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares:

 

Shareholder

   Shares Outstanding     % Voting
Power
 
     Class A common shares     Class B common shares     Total        
     Shares      %     Shares      %     Shares      %        

LuxCo

     243,704,227        30.04     297,860,722        100.00     541,564,949        48.83     85.03

Other shareholders

     567,493,236        69.96     —          —         567,493,236        51.17     14.97
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

     811,197,463        100.00 %      297,860,722        100.00 %      1,109,058,185        100.00 %      100.00 % 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Scenario 2: All Eligible Shareholders request to convert 100% of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares (Minimum Free Float of 20% is applied)

(a) LuxCo requests to convert all of its JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares:

 

Shareholder

   Shares Outstanding     % Voting
Power
 
     Class A common shares     Class B common shares     Total        
     Shares      %     Shares      %     Shares      %        

LuxCo

     —          —         541,564,949        61.04     541,564,949        48.83     59.55

Other shareholders

     221,811,637        100.00     345,681,599        38.96     567,493,236        51.17     40.45
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

     221,811,637        100.00 %      887,246,548        100.00 %      1,109,058,185        100.00 %      100.00 % 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

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(b) LuxCo requests to convert none of its JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares:

 

Shareholder

   Shares Outstanding     % Voting
Power
 
     Class A common shares     Class B common shares     Total        
     Shares      %     Shares      %     Shares      %        

LuxCo

     243,704,227        52.35     297,860,722        46.28     541,564,949        48.83     46.69

Other shareholders

     221,811,637        47.65     345,681,599        53.72     567,493,236        51.17     53.31
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

     465,515,864        100.00 %      643,542,321        100.00 %      1,109,058,185        100.00 %      100.00 % 
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Our actual shareholder structure immediately following the Class A Conversion Period will depend on the shareholding structure of JBS S.A. immediately prior to the Proposed Transaction, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

The Merger of Shares Protocol

In connection with the Proposed Transaction, we will enter into the Merger of Shares Protocol, as further described below.

The Merger of Shares Protocol (Protocolo e Justificação de Incorporação de Ações) is a document prepared pursuant to Articles 224, 225 and 252 of the Brazilian Corporation Law, which the managements of JBS S.A. and HoldCo will each submit for approval at their respective special meetings of shareholders and which provides the shareholders with information on the terms, conditions and reasoning for the approval of the Merger of Shares contemplated by the Proposed Transaction. The terms and conditions of the Proposed Transaction are contained in the Merger of Shares Protocol are described in this prospectus, and an English translation of the Merger of Shares Protocol is included as an exhibit to the registration statement of which this prospectus forms a part. You are encouraged to read the Merger of Shares Protocol carefully. All descriptions in this summary and in this prospectus of the terms and conditions of the Proposed Transaction are qualified in their entirety by reference to the Merger of Shares Protocol.

 

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The Merger of Shares Protocol also establishes the justification presented by the managements of JBS S.A. and HoldCo, explaining the reasons why the Proposed Transaction is beneficial and meets the best interest of the shareholders.

Purpose of the Proposed Transaction

The purpose of the Proposed Transaction is to create a corporate structure that allows us to better reflect our global presence and diverse international operations and implement our growth strategy, which we expect will allow us to improve our rating indices and maximize shareholder value. As an NYSE-listed company, we expect to improve our access to funding sources and enhance our ability to raise financing to support our operations and fund growth, as well as lower our cost of capital.

Set forth below are significant factors our management considered when designing and selecting the structure of the Proposed Transaction.

Why the Netherlands?

In connection with the Proposed Transaction, the JBS Group’s parent company will be a Dutch holding company. In selecting the new location for its parent company, management considered the strategic geographic and logistical position of the Netherlands within the JBS Group’s global operations. The JBS Group already operates business in the Netherlands through the trading of poultry and pork from Brazil, USA and Mexico, having a physical presence in the country for more than twenty years. We further believe that the Netherlands would be an appropriate jurisdiction for JBS N.V. given that, among other things, (i) the Netherlands is a jurisdiction with political and financial stability, strong tax policy and currency, offers a well-developed legal regime and established infrastructure that is well suited to facilitate our business operations, (ii) Dutch company law allows for a tailor-made corporate structure that fully aligns with our ownership structure while ensuring due observance of stakeholder interests, and (iii) the Netherlands has a strong bilateral investment and tax treaty network and has historically been an important hub for international companies. Finally, the annual cost of maintaining a listed Dutch vehicle is lower compared to other well-established jurisdictions.

Why a dual class structure?

In the first step in the Restructuring, prior to the Proposed Transaction, our controlling shareholders will transfer their JBS S.A. Common Shares to JBS N.V. in exchange for JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares. In the second step in the Restructuring, which includes our Proposed Transaction, JBS S.A.’s minority shareholders will receive BDRs representing JBS N.V. Class A Common Shares (see “—Why BDRs?”).

The shareholders of JBS N.V. will be the same as the shareholders of JBS S.A. on the Last Trading Day, and on the Closing Date, our controlling shareholders will (indirectly, through LuxCo) hold an aggregate number of JBS N.V. Class B Common Shares and JBS N.V. Class A Common Shares that represents the same economic interest in JBS N.V. as our controlling shareholders have in JBS S.A. on the Last Trading Day, except for the effect of the sale of any fractional JBS N.V. BDRs attributed to shareholders of JBS S.A. resulting from the Merger of Shares and the Redemption and the issuance or transfer of JBS N.V. Class A Common Shares to certain members of senior management as a performance bonus for the successful completion of the Proposed Transaction, as further described under “Management—Compensation of Executive Officers and Directors.” However, since the capital structure of JBS N.V. will differ from that of JBS S.A. as a result of the dual-class structure of JBS N.V. (each JBS N.V. Class A Common Share is entitled to one vote at a general meeting of shareholders of JBS N.V. and each JBS N.V. Class B Common Share is entitled to 10 votes at a general meeting of shareholders of JBS N.V.), the voting power of the ultimate controlling shareholders will increase from 48.83% to 85.03% immediately upon completion of the Proposed Transaction (assuming the ownership structure of JBS S.A. on the Last Trading Day is the same as on June 30, 2023). Following the completion of the Proposed Transaction, and except for any future issuances of JBS N.V. Class A Common Shares, this voting power will be reduced only if and to the extent that holders of JBS

 

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N.V. Class A Common Shares successfully request conversions of their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period and do not reconvert into JBS N.V. Class A Common Shares thereafter. Moreover, this voting power will be increased to 90.52% to the extent that our controlling shareholders (through LuxCo) successfully request conversions of all their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares during the Class A Conversion Period, Eligible Shareholders do not request such conversion and our controlling shareholders (through LuxCo) do not reconvert into JBS N.V. Class A Common Shares thereafter and no new shares of JBS N.V. are issued. Following the Class A Conversion Period (and assuming no new shares of JBS N.V. are issued during this period), our controlling shareholders will (indirectly, through LuxCo) hold between 46.69% and 90.52% of the aggregate voting power in JBS N.V. The exact percentage of the then-outstanding JBS N.V. Shares and aggregate voting power in JBS N.V. that will be held (indirectly) by our controlling shareholders upon completion of the Proposed Transaction and the Conversion will depend on the percentage of JBS S.A. shares that they hold on the Last Trading Day, the number of JBS N.V. Class A Common Shares that are converted into JBS N.V. Class B Common Shares during the Class A Conversion Period and reconverted into JBS N.V. Class A Common Shares, and any additional issuances of JBS N.V. Common Shares after the Proposed Transaction.

We believe that the proposed dual class structure is imperative to allow our company access to a cost-effective and readily available source of financing through the equity capital markets that is currently unavailable to JBS S.A. as a result of JBS S.A.’s single class structure. Currently, management proposals that require equity financing and would result in the dilution of our controlling shareholders depend on the approval of such proposals by our controlling shareholders at a general meeting of shareholders, and our controlling shareholders may not vote favorably for such proposals if such proposals would result in a loss of control. A dual-class structure, with our controlling shareholders holding high voting shares, would make it easier for our controlling shareholders to approve such proposals.

In addition, we believe that our ultimate controlling shareholders bring a long-term vision for our company that is grounded on past growth and success and ensuring our controlling shareholders’ long-term commitment and active participation is vital to safeguarding the long-term stability of our strategy and ensuring long-term value creation for all of our stakeholders, including our shareholders. For more information about the leadership of the Batista family and our company’s growth over the past 70 years, see “Information about JBS S.A.—History and Development.”

The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as described under the caption “JBS S.A. General MeetingAgenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares. The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting. In addition, holders of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting must approve the Delisting. For more information about the percentage of shareholders required to approve each matter being voted upon at the JBS S.A. General Meeting, see “JBS S.A. General Meeting—Required Vote.” Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.” Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters.

 

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Why BDRs?

Holders of JBS S.A. Common Shares on the Last Trading Day shall initially receive JBS N.V. BDRs in connection with the Proposed Transaction because, pursuant to the rules of the B3, they are required to receive a Brazilian security in connection with the Merger of Shares and the Redemption. However, at any time, and from time to time, on or after about two business days after the Closing Date, a holder of JBS N.V. BDRs that wants to receive JBS N.V. Class A Common Shares may request the cancellation of all or a portion of its JBS N.V. BDRs. See “—Receiving JBS N.V. Class A Common Shares.”

Why HoldCo?

We structured the Proposed Transaction to include the intermediate steps involving HoldCo because under Brazilian law, a merger of shares (incorporação de ações), in which the merged company retains its legal identity, is only permitted between two Brazilian companies. Accordingly, the Proposed Transaction could not be implemented as a merger of shares directly between JBS S.A. (a Brazilian corporation) and JBS N.V. (a Dutch public limited liability company). As an alternative to the merger of shares, a full legal cross-border merger (incorporação) of JBS S.A. into JBS N.V. is not permitted under Dutch Law since JBS N.V. can only legally merge with an entity governed by the laws of a European Union or European Economic Area member state, which does not apply to HoldCo. Even if permitted, such merger would be unadvisable because upon its implementation, JBS S.A. would cease to exist. In such case, a large amount of human and financial resources and time would be required to implement the merger, including the succession of JBS S.A. by JBS N.V. under all of JBS S.A.’s existing agreements (financial, commercial and otherwise), permits and authorizations. This cost and time expenditure is avoided in the merger of shares structure contemplated by the Proposed Transaction, which preserves JBS S.A. as an existing entity.

Why LuxCo?

As the first step in the Restructuring, prior to the Closing Date, JBS N.V. will, through a series of transactions, become the indirect controlling shareholder of JBS S.A. On July 7, 2023, our controlling shareholders entered into a binding and unconditional agreement with JBS N.V., HoldCo and LuxCo pursuant to which: (1) JBS S.A.’s controlling shareholders will contribute and transfer all of their JBS S.A. Common Shares at book value to LuxCo; (2) immediately thereafter, LuxCo will contribute and transfer all such JBS S.A. Common Shares at book value to JBS N.V. in exchange for 243,704,227 JBS N.V. Class A Common Shares and 297,860,722 JBS N.V. Class B Common Shares (whereby the difference in the value of the JBS S.A. Common Shares and the aggregate nominal value of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares will be added to the general share premium reserve maintained by JBS N.V.); and (3) immediately thereafter, JBS N.V. will contribute and transfer such JBS S.A. Common Shares at book value to HoldCo in exchange for common shares of HoldCo. These transactions and transfers of equity interests must be consummated and completed no later than December 31, 2023. As a result of this step, JBS N.V. will, through HoldCo, indirectly hold the shares of JBS S.A. that are currently held directly by JBS S.A.’s controlling shareholders.

We structured the first step of the Restructuring to include LuxCo for the following reasons. First, the intermediate step involving LuxCo is tax neutral for holders of both JBS N.V. Class A Common Shares and JBS N.V. Class B Common Shares. For JBS N.V., the contribution of shares of JBS S.A. by a European Union company such as LuxCo, as opposed to by JBS S.A.’s controlling shareholders, in JBS N.V. results in an intra-EU share transfer of JBS S.A.’s shares and solidifies the recognition of the contribution of the shares of JBS S.A. on JBS N.V.’s tax balance sheet for Dutch tax purposes. Moreover, LuxCo allows the controlling shareholders to concentrate their current participations at JBS S.A. in a single vehicle that will hold JBS N.V. Common Shares, solidifying the controlling shareholder’s corporate governance and facilitating the exercise of voting rights at general meetings of shareholders of JBS N.V.

 

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Why an extended Class A Conversion Period, Maximum Conversion Rate and Minimum Free Float?

Following the conclusion of the Proposed Transaction, for a period starting on the first day the JBS N.V. Class A Common Shares will trade on the NYSE and ending on December 31, 2026, which period we refer to as the Class A Conversion Period, each person entitled to one or more JBS N.V. BDRs at the opening of trading on the Conversion Record Date, may request, after having cancelled such JBS N.V. BDRs and received the underlying JBS N.V. Class A Common Shares, to convert all or a portion of such JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares at a ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The maximum number of JBS N.V. Class A Common Shares which an Eligible Shareholder may request to convert into JBS N.V. Class B Common Shares, which we refer to as the Maximum Convertible Shares, equals the number of JBS N.V. BDRs to which such Eligible Shareholder is entitled at the opening of trading of the JBS N.V. BDRs on the B3 on the Conversion Record Date (not including any fractional JBS N.V. BDRs received as part of the Proposed Transaction).

Except with respect to conversion requests submitted during the Last Conversion Quarter, the maximum number of JBS N.V. Class A Common Shares held by an Eligible Shareholder that may be converted into JBS N.V. Class B Common Shares will be limited to the Maximum Conversion Rate of 55% of such Eligible Shareholder’s Maximum Convertible Shares. During the Class A Conversion Period, our board of directors will resolve on any conversion requests within          business days after the end of each fiscal quarter for any such requests received from Eligible Shareholders during such quarter, provided such requests are deemed satisfactory to the board of directors. With respect to the Last Conversion Quarter (i.e., the fourth quarter of 2026), the Maximum Conversion Rate will not apply, but if the aggregate number of JBS N.V. Class A Common Shares in respect of which our board of directors has received one or more conversion requests during the entire Class A Conversion Period which it deems satisfactory would, if all JBS N.V. Class A Common Shares to which such conversion request(s) pertain(s) would be converted into JBS N.V. Class B Common Shares, cause the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float of 20%, the number of JBS N.V. Class A Common Shares to which each such conversion request received during the Last Conversion Quarter pertains shall be reduced on a pro rata basis so that the aggregate number of JBS N.V. Class A Common Shares converted into JBS N.V. Class B Common Shares does not result in the JBS N.V. Free Float Percentage on December 31, 2026 to fall below the Minimum Free Float. The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE.

In addition, during the Class A Conversion Period, our controlling shareholders (through LuxCo) may request to convert all or a portion of the JBS N.V. Class A Common Shares held by LuxCo at 10 a.m. São Paulo time on the Conversion Record Date into JBS N.V. Class B Common Shares at the same ratio of one JBS N.V. Class B Common Share for each JBS N.V. Class A Common Share held. The Maximum Conversion Rate and the Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares. Any and all JBS N.V. Class A Common Shares not converted into JBS N.V. Class B Common Shares by the Eligible Shareholders and/or LuxCo during the Class A Conversion Period will be retained as such by such Eligible Shareholder and/or LuxCo, as the case may be.

We believe that granting Eligible Shareholders a multiple-year period to request to convert their JBS N.V. Class A Common Shares into JBS N.V. Class B Common Shares will allow them to have a mature understanding of the dynamics of the behavior of the JBS N.V. Class A Common Shares trading on the NYSE. This will allow them to make an informed choice between holding JBS N.V. Class A Common Shares, which will trade on the NYSE, but with less votes, or if they are more interested in holding our JBS N.V. Class B Common Shares, destined to shareholders that present a more long term approach in their investment in JBS N.V. that want to try to enhance their influence in the matters subject to deliberation at general meetings of shareholders of JBS N.V.

 

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The Maximum Conversion Rate and the Minimum Free Float are intended to maintain a minimum number of JBS N.V. Class A Common Shares outstanding in order to improve the liquidity of the JBS N.V. Class A Common Shares that will trade on the NYSE. For the avoidance of doubt, the Maximum Conversion Rate and Minimum Free Float will not be applicable to conversion requests made by LuxCo, which will be entitled at any time during the Class A Conversion Period to request to convert all or a portion of the JBS N.V. Class A Common Shares held by it on the Conversion Record Date into JBS N.V. Class B Common Shares, since the JBS N.V. Class A Common Shares held by LuxCo will be subject to transfer restrictions and may be excluded from the calculation of “publicly-held shares” under the NYSE’s listing requirements for so long as LuxCo is considered an “affiliate” of JBS N.V., as that term is generally interpreted for U.S. federal securities law purposes. See “Shares Eligible for Future Sale.” Notwithstanding the above, there is no existing market for JBS N.V. Class A Common Shares, and we cannot predict whether a liquid trading market will develop. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—There is no existing market for JBS N.V. Class A Common Shares or JBS N.V. BDRs, and we do not know whether one will develop to provide you with adequate liquidity. If the trading price of JBS N.V. Class A Common Shares or JBS N.V. BDRs fluctuates after completion of the Proposed Transaction, you could lose a significant part of your investment.”

Other considerations

In selecting the structure of the Proposed Transaction, our management also considered various negative aspects of the transaction, including:

 

   

Risks relating to our dual-class structure. Our dual-class structure may result in a lower or more volatile market price of the JBS N.V. Class A Common Shares and the JBS N.V. BDRs or in adverse publicity or other adverse consequences, including the inability of companies with multiple equity classes to be included in certain indices, such as the S&P 500. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The difference in the voting rights of the JBS N.V. Class A Common Shares and the JBS N.V. Class B Common Shares may harm the value and liquidity of the JBS N.V. Class A Common Shares.”

 

   

Implementation costs. We expended and will continue to expend significant management time and resources and have incurred and will continue to incur significant expenses due to legal, advisory and accounting services fees related to the Proposed Transaction. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs— Failure to conclude the Proposed Transaction after approval at JBS S.A. General Meeting may adversely affect the market price of JBS S.A. Common Shares.”

 

   

Compliance costs. Following the Proposed Transaction, JBS N.V. will become a public reporting company in the United States and Brazil and will be subject to reporting, disclosure control and other applicable obligations under the Exchange Act, the Sarbanes-Oxley Act and the Dodd-Frank Act, as well as rules adopted, and to be adopted, by the SEC, the NYSE, the CVM and the B3. As a result, we will incur higher legal, accounting and other expenses than before, and these expenses may increase even more in the future. See “Risk Factors—Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—Following the Proposed Transaction JBS N.V. will become a U.S. public reporting company subject to U.S. financial reporting rules and regulations and other requirements of the SEC. Our accounting and other management systems and resources may not be immediately prepared to meet these requirements, which may strain our resources.”

Despite these challenges, our management has chosen to proceed with the Proposed Transaction in its current form because it believes that, on balance, the benefits to our company and investors of the Proposed Transaction, including a U.S. listing, should outweigh the risks and costs.

 

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Corporate Approvals

The completion of the Proposed Transaction is subject to the approval of JBS S.A. Shareholders at the JBS S.A. General Meeting. The Merger of Shares and ancillary matters, such as the Merger of Shares Protocol and related valuation reports, as described under the caption “JBS S.A. General MeetingAgenda of the JBS S.A. General Meeting,” require the affirmative vote of at least the majority (50% plus 1 share) of the total outstanding JBS S.A. Common Shares. The Cash Dividend requires the affirmative vote of at least the majority (50% plus 1 share) of the outstanding JBS S.A. Common Shares present at the JBS S.A. General Meeting. In addition, holders of at least the majority (50% plus 1 share) of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting must approve the Delisting. For more information about the percentage of shareholders required to approve each matter being voted upon at the JBS S.A. General Meeting, see “JBS S.A. General Meeting—Required Vote.” Although, as described above, the minimum vote requirements to approve the different matters being voted on at the JBS S.A. General Meeting vary, all matters subject to vote at the JBS S.A. General Meeting are conditional upon each other, such that if one matter is not approved, the others will also be rejected. Since the Delisting must be approved by a majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting, the approval of all matters at the JBS S.A. General Meeting will ultimately require approval of the majority of the JBS S.A. Free Float Outstanding present at the JBS S.A. General Meeting. See “Risk Factors— Risks Relating to the Proposed Transaction, the JBS N.V. Common Shares and the JBS N.V. BDRs—The Proposed Transaction may be approved by a small percentage of our non-controlling shareholders.” Our controlling shareholders, who held 48.83% of the issued and outstanding JBS S.A. Common Shares as of June 30, 2023, will be counted for quorum purposes to install the JBS S.A. General Meeting but will only vote in favor of the Merger of Shares (and ancillary matters) and the Cash Dividend if the Delisting is approved and only if the controlling shareholders’ votes are necessary to reach the minimum required affirmative votes. Otherwise, our controlling shareholders will abstain from voting on such matters.

On                     , 2023, the board of directors of JBS S.A. approved convening the JBS S.A. General Meeting that will decide on the Proposed Transaction and recommended its approval.

In addition, the Redemption requires the approval of JBS N.V., as sole shareholder of HoldCo, at the HoldCo General Meeting.

Conditions Precedent to the Proposed Transaction

In addition to the necessary corporate approvals, including approval of the Proposed Transaction at the JBS S.A. General Meeting, the material conditions that must be satisfied to complete the Proposed Transaction are set forth below, in chronological order:

Before the JBS S.A. General Meeting is called:

 

   

The registration statement filed with the SEC on Form F-4 to effect the registration under the Securities Act of the JBS N.V. Class A Common Shares (i.e., the underlying assets of the JBS N.V. BDRs) to be issued and delivered to JBS S.A. Shareholders and the JBS N.V. Class B Common Shares (of which this prospectus is a part) shall have become effective prior to the date the JBS S.A. General Meeting is called, no stop order suspending the effectiveness of the Form F-4 shall have been issued, and no proceedings for that purpose shall have been initiated or be threatened, by the SEC.

Before the completion of the Proposed Transaction: