text: **14. Convertible Debentures (continued)**
  
  Killam’s $46.0 million convertible subordinated debentures are redeemable at the option of Killam after June 30, 2014, and on or 
  before June 30, 2016 (provided that the current market price of the common shares of the company on the date on which the 
  notice of redemption is given is not less than 125% of the conversion price). After June 30, 2016, the debentures are redeemable 
  at face value. Upon maturity or redemption, Killam may elect to repay all or any portion of the debentures outstanding by issuing 
  the number of common shares obtained by dividing the aggregate of the principal amount of the debentures that have matured or 
  are being redeemed by 95% of the weighted average market price of the common shares for the preceding 20 days (ending 5 days 
  preceding the fixed date for redemption or maturing). At the time of issuance, the fair value of Killam’s obligation to make principal 
  and interest payments was $43.9 million and the fair value of the holders’ conversion option was $2.1 million (which is reflected in 
  “Other paid‑in capital”). The effective rate of interest on the liability component, which is paid semiannually, is calculated at 6.3%. 