Management’s Discussion and Analysis Operating Facility Shareholders’ Equity Dollar amounts are in thousands of Canadian dollars (except as noted) An operating facility which consists of a $1.0 million revolving demand facility for general business purposes, bearing interest at the lender’s  prime rate plus 1%. As at December 31, 2013, the Company had letters of credit totaling $0.5 million outstanding against this facility (December  31, 2012 ‑ $0.3 million). The agreement includes certain covenants and undertakings of which the Company is in compliance. For the year ended December 31, 2013, 144,349 stock options were exercised for common shares and cash proceeds to the Company of $1.0  million (December 31, 2012 ‑ 471,953 and cash proceeds of $4.2 million). There were also 50,090 RSUs redeemed and 21,838 common shares  issued related to the redemptions during 2013 (December 31, 2012 – Nil). The Company also issued 194,774 common shares related to property  acquisitions for a total value of $2.4 million (2012 – Nil). During 2013 Killam paid a dividend of $0.04833 per share per month ($0.58 per share annualized). the dividend was increased to $0.05 per  share per month ($0.60 per share annualized) effective for the January 2014 dividend payment in February 2014. The Company’s Dividend  Reinvestment Plan (“DRIP”) allows shareholders to elect to have all cash dividends from the Company reinvested in additional common  shares. Shareholders who participate in the DRIP receive an additional dividend of common shares equal to 3% of each cash dividend that was  reinvested. The price per share is calculated by reference to the ten‑day volume weighted average price of the Company’s common shares  on the Toronto Stock Exchange preceding the relevant dividend date, which typically is on or about the 15th day of the month following the  dividend declaration. For the year ended December 31, 2013, the Company issued 296,004 common shares under the DRIP with a value of $3.3  million (December 31, 2012 – 347,473 common shares with a value of $4.4 million). For the year ended December 31, 2013, the average DriP  participation rate was 10% (2012 ‑ 15%). 56  Killam ProPerties inc | 2013