Algonquin Power & Utilities Corp. – Consolidated Financial Statements ALGONQUIN POWER & UTILITIES CORP.  Notes to the Consolidated Financial Statements  December 31, 2012 and 2011   (in thousands of Canadian dollars except as noted and amounts per share)  14.  Shareholders’ capital (continued)  (c)  Share-based compensation (continued)  i) Stock option plan (continued)  The following assumptions were used in determining the fair value of share options granted:  2012 2011 Risk-free interest rate  1.7%  3.0% Expected volatility  38% 30% Expected dividend yield  4.4%  5.3% Expected life  8 years  8 years Weighted average grant date fair value per option  $ 1.49  $ 0.99 Number of  awards Weighted  average  exercise  price  Weighted  average  remaining  contractual  term (years) Aggregate  intrinsic  value Balance at January 1, 2012  2,487,105  $ 4.76  6.96  $  4,134 Granted 1,263,622  6.24  8.00  - Balance at December 31, 2012  3,750,727  $ 5.25  6.07  $  5,939 Exercisable at December 31, 2012 1,215,770  $ 4.53  5.85  $  2,805 Number of  awards  Weighted  Average Grant  Date Fair value  value Non-vested options at January 1, 2012  2,100,369  $  0.85 Granted  1,263,622  1.49 Vested  829,035  0.81 Non-vested options at December 31, 2012  2,534,956  $  1.18 Non-vested stock option activity during the period is as follows:  Stock option activity during the period is as follows:  2012 Annual Report 116