Notes to Financial Statements Dollars in thousands, except share and per share amounts and where indicated as in millions or billions trustees. MSA exchanged the remaining 8,000 Class B common shares with David Simon for 8,000 shares of common  stock and David Simon’s agreement to create a new voting trust under which the Simons as voting trustees, hold and vote  the remaining 8,000 shares of Class B common stock acquired by David Simon. As a result, these voting trustees have the  authority to elect four of the members of the Board of Directors contingent on the Simons maintaining specified levels of  equity ownership in Simon Property, the Operating Partnership and their subsidiaries. On January 22, 2003, three limited partners exchanged 13,469 Units for 13,469 shares of common stock. On February  19, 2003, two limited partners exchanged 2,867,341 Units for 2,867,341 shares of common stock. We issued 733,617 shares of common stock related to employee stock options exercised during 2003. We used the net  proceeds from the option exercises of approximately $17.5 million to acquire additional units of the Operating Partnership.  The Operating Partnership used the net proceeds for general working capital purposes. We also issued 12,443,195 shares of  common stock in connection with the conversions of the 6.5% Series B preferred stock. We issued 9,000,000 shares of common stock in a public offering on July 1, 2002. We used the net proceeds of $322.2  million to pay down a portion of the debt issued to finance the Rodamco acquisition. Common Stock Issuances Preferred Stock The following table summarizes each of the authorized series of preferred stock of Simon Property: As of December 31,  2003 2002 Series B 6.5% Convertible Preferred Stock, 5,000,000 shares authorized, 0 and 4,830,057 issued and outstanding  $  – $ 449,196 Series C 7.00% Cumulative Convertible Preferred Stock, 2,700,000 shares authorized, none issued or outstanding  – – Series D 8.00% Cumulative Redeemable Preferred Stock, 2,700,000 shares authorized, none issued or outstanding  – – Series E 8.00% Cumulative Redeemable Preferred Stock, 1,000,000 shares authorized, 1,000,000 issued and outstanding  24,863 24,656 Series F 8.75% Cumulative Redeemable Preferred Stock, 8,000,000 shares authorized, 8,000,000 issued and outstanding  192,989 192,989 Series G 7.89% Cumulative Step-Up Premium Rate Preferred Stock, 3,000,000 shares authorized, 3,000,000 issued and outstanding  147,681 147,413 Series H Variable Rate Preferred Stock, 4,530,000 shares authorized, 78,012 and 0 issued and outstanding  1,950 – $ 367,483 $ 814,254  Dividends on all series of preferred stock are calculated based upon the preferred stock’s preferred return multiplied  by the preferred stock’s corresponding liquidation value. The Operating Partnership pays preferred distributions to Simon  Property equal to the dividends paid on the preferred stock issued. “Preferred dividends of subsidiary” in the accompanying  statements of operations and comprehensive income prior to July 1, 2001 represented distributions on preferred stock of  SPG Properties, Inc., a former subsidiary of Simon Property that was merged into Simon Property on that date.  Series A Convertible Preferred Stock.  During 2002, the remaining 49,839 shares of Simon Property Series A 6.5%  Convertible Preferred Stock were converted into 1,893,651 shares of common stock. In addition, another 19,375 shares of  common stock were issued to the holders of the converted shares in lieu of the cash dividends allocable to those preferred  shares.  simon property group, inc. 70