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Share-Based Payments
 6 Months Ended
Jun. 30, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-Based Payments
Share-Based Payments
During the first half of 2012 and 2011, we recognized share-based compensation expense related to the following Class B common stock awards to certain directors, officers and other eligible employees, pursuant to the Molson Coors Brewing Company Incentive Compensation Plan ("Incentive Compensation Plan"): restricted stock units ("RSU"), deferred stock units ("DSU"), performance units ("PU"), stock options and stock-only stock appreciation rights ("SOSAR").
The following table summarizes components of the share-based compensation expense:
 
Thirteen Weeks Ended
 
Twenty-Six Weeks Ended
 
June 30, 2012
 
June 25, 2011
 
June 30, 2012
 
June 25, 2011
 
(In millions)
Stock options and SOSARs
 
 
 
 
 
 
 
Pre-tax compensation expense
$
0.7

 
$
1.1

 
$
2.6

 
$
3.9

Tax benefit
(0.2
)
 
(0.3
)
 
(0.8
)
 
(1.1
)
After-tax compensation expense
$
0.5

 
$
0.8

 
$
1.8

 
$
2.8

RSUs and DSUs
 
 
 
 
 
 
 
Pre-tax compensation expense
$
2.5

 
$
3.1

 
$
4.6

 
$
5.4

Tax benefit
(0.7
)
 
(0.8
)
 
(1.3
)
 
(1.3
)
After-tax compensation expense
$
1.8

 
$
2.3

 
$
3.3

 
$
4.1

PUs
 
 
 
 
 
 
 
Pre-tax compensation expense
$
1.9

 
$
2.0

 
$
2.9

 
$
5.0

Tax benefit
(0.5
)
 
(0.6
)
 
(0.9
)
 
(1.5
)
After-tax compensation expense
$
1.4

 
$
1.4

 
$
2.0

 
$
3.5

Total after-tax compensation expense
$
3.7

 
$
4.5

 
$
7.1

 
$
10.4


During the first half of 2012, we granted 0.2 million stock options, 0.3 million RSUs and 0.7 million PUs, all of which were outstanding, other than an insignificant amount of cancellations, as of June 30, 2012.
The mark-to-market share-based compensation expense before tax, related to our share-based awards granted to former CBC employees now employed by MillerCoors, was an expense of $0.1 million and a benefit of $0.1 million during the second quarter of 2011 and first half of 2011, respectively. We did not record an adjustment in the second quarter of 2012 or first half of 2012 as these awards were fully vested as of the end of the second quarter of 2011. No further adjustments will be recorded related to these awards. These amounts are included in the table above.
As of June 30, 2012, there was $32.5 million of total unrecognized pre-tax compensation expense related to non-vested shares from share-based compensation arrangements granted under the Incentive Compensation Plan. This compensation expense is expected to be recognized over a weighted-average period of approximately 1.6 years.
The following table represents the summary of stock options and SOSARs outstanding as of June 30, 2012, and the activity during the first half of 2012:
 
Outstanding
options
 
Weighted-average
exercise price per
share
 
Weighted-average
remaining
contractual life
(years)
 
Aggregate
intrinsic value
 
(In millions, except per share amounts and years)
Outstanding as of December 31, 2011
7.1
 
$38.69
 
4.31
 
$
43.1

Granted
0.2
 
$42.80
 
 
 
 
Exercised
(0.7)
 
$30.06
 
 
 
 
Forfeited
(0.1)
 
$46.86
 
 
 
 
Outstanding as of June 30, 2012
6.5
 
$39.70
 
4.28
 
$
26.0

Exercisable at June 30, 2012
5.6
 
$39.09
 
3.63
 
$
26.0

The total intrinsic value of options exercised during the first half of 2012 and 2011 was $9.6 million and $2.1 million, respectively. During the first half of 2012, cash received from stock option exercises was $20.8 million and the total net tax benefit to be realized for the tax deductions from these option exercises was $3.2 million.
The following table represents non-vested RSUs, DSUs and PUs as of June 30, 2012, and the activity during the first half of 2012:
 
RSUs and DSUs
 
PUs
 
Units
 
Weighted-average
grant date fair value
per unit
 
Units
 
Weighted-average
grant date fair value
per unit
 
(In millions, except
per unit amounts)
 
(In millions, except
per unit amounts)
Non-vested as of December 31, 2011
0.6

 
$43.35
 
2.0

 
$11.67
Granted
0.3

 
$42.12
 
0.7

 
$14.35
Vested
(0.2
)
 
$42.46
 
(0.7
)
 
$10.92
Forfeited
—

 
$43.35
 
(0.1
)
 
$11.20
Non-vested as of June 30, 2012
0.7

 
$43.20
 
1.9

 
$11.41
The fair value of each option granted in the first half of 2012 and 2011, respectively, was determined on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:
 
Twenty-Six Weeks Ended
 
June 30, 2012
 
June 25, 2011
Risk-free interest rate
1.56%
 
2.55%
Dividend yield
2.98%
 
2.52%
Volatility range
25.80%-27.56%
 
25.26%-28.11%
Weighted-average volatility
25.84%
 
26.37%
Expected term (years)
4.0-7.7
 
4.0-7.7
Weighted-average fair market value
$8.18
 
$9.66
The risk-free interest rates utilized for periods throughout the contractual life of the options are based on a zero-coupon U.S. Treasury security yield at the time of grant. Expected volatility is based on historical volatility of our stock. The expected term of options is estimated based upon observations of historical employee option exercise patterns and trends. The range on the expected term results from separate groups of employees who exhibit different historical exercise behavior.
As of June 30, 2012, there were 8.0 million shares of our Class B common stock available for the issuance of stock options, SOSARs, RSUs, DSUs, PUs and performance share units under the Incentive Compensation Plan. This reflects the 5.0 million additional shares approved by our shareholders during the second quarter of 2012.