bunge 2004 annual report notes to the consolidated  financial statements The computation of diluted earnings per common share for the years ended December 31, 2004, 2003 and 2002 include the weighted average common shares that would be issuable upon conversion of Bunge’s 3.75% convertible notes due 2022, having a $250 million aggregate principal amount. The convertible notes are convertible into Bunge’s common shares at the option of a holder, among other circumstances, during any calendar quarter in which the closing price of Bunge’s common shares for at least 20 trading days of the last 30 trading days of the immediately preceding calendar quarter is more than 120% of the conversion price of $32.1402 or approximately $38.57 per share. The initial conversion rate is 31.1137 common shares of Bunge Limited for each $1,000 principal amount of notes converted. The following table sets forth the computation of basic and diluted earnings per share for the years ended December 31, 2004, 2003 and 2002. equity incentive plan In 2001, Bunge established its Equity Incentive Plan which is a shareholder approved plan. Under the plan, the compensation committee of the board of directors may award equity-based compensation to officers, employees, con- sultants and independent contractors. Awards under the plan may be in the form of stock options (statutory or non-statutory), restricted stock units (performance-based or time-vested) or other awards. 25. stock-based compensation stock option awards Generally, stock options to purchase Bunge Limited common shares are non-statutory and granted  at not less than fair market value on the date of grant, as deter- mined under the Equity Incentive Plan. Options generally vest  on a pro-rata basis over a three-year period on the anniversary date of the grant. Vesting may be accelerated in certain circum- stances such as a change in control of Bunge. restricted stock units Performance-based restricted  stock units and time-vested restricted stock units are granted  to a limited number of key employees. The performance-based restricted stock units are awarded at the beginning of a three- year performance period and vest following the end of the three-year performance period. The vesting of the performance- based restricted stock units is dependent on Bunge obtaining certain targeted cumulative earnings per share (EPS) or segment  operating profit (for awards granted to employees of operating companies) during the three-year performance period. The  targeted cumulative EPS under the plan is based on income  per share from continuing operations adjusted for non-recurring charges and other one-time events at the discretion of Bunge’s compensation committee. Vesting may be accelerated in certain situations such as a change in control of Bunge. The actual award is calculated based on a sliding scale whereby 50% of the granted performance-based restricted stock unit award vests if the minimum target is achieved. No vesting occurs if cumulative EPS or the segment operating profit is less than the minimum target. The award is capped at 150% of the grant for cumulative EPS performance in excess of the maximum target for the 2002 and 2003 grants and 200% of the grant for cumulative EPS per- formance or segment operating profit in excess of the maximum target for the 2004 grants. Performance-based restricted stock unit awards may be paid out, at the participant’s election, subject Year Ended December 31, (US$ in millions, except for share data) 2004 2003 2002 Income from continuing  operations—basic $ 4 46 69 9 $ 418 $ 275 Interest on convertible notes, net of tax 5 5 1 Interest from continuing  operations—diluted $ 4 47 74 4 $ 423 $ 276 Weighted average  number of common  shares outstanding: Basic 1 10 06 6,,0 01 15 5,,8 86 69 9 99,745,825 95,895,338 Effect of dilutive shares: —stock options  and awards 1 1,,8 87 79 9,,7 76 62 2 1,129,777 753,791 —convertible notes 7 7,,7 77 78 8,,4 42 25 5 7,778,425 745,876 Diluted 1 11 15 5,,6 67 74 4,,0 05 56 6 108,654,027 97,395,005 Income from continuing  operations per share: Basic $ $ 4 4..4 42 2 $ 4.19 $ 2.87 Diluted $ $ 4 4..1 10 0 $ 3.89 $ 2.83 80