Share-based compensation plans

We have share-based compensation plans to retain employees and nonemployee directors and to more closely align their interests with those of our shareholders.

We have granted share-based awards to employees under the 2005 Equity Incentive Plan and the 2013 Equity Incentive Plan. These plans permit grants of restricted stock, restricted stock units, performance stock, performance units, stock appreciation rights, stock options, as well as other share-based awards to eligible employees. The 2013 Plan also permits cash awards to eligible employees. The 2005 Plan was replaced by the 2013 Plan effective in February 2013. No further grants of awards will be made under the 2005 Plan.

We have granted deferred stock units to directors through the Non-Employee Directors’ Equity Plan. Share-based awards were granted to directors and remain outstanding under the Non-Employee Directors’ Stock Option Plan and the Directors’ Stock Accumulation Plan, both of which have expired.

Outstanding awards at March 31, 2016 include performance share units, market share units, restricted stock units, deferred stock units and stock options.

Compensation Expense

Compensation expense is measured using the fair-value-based method. For employee and director awards considered equity grants, compensation expense is recognized from the grant date to the earlier of the retirement-eligible date or the vesting date.

In February 2016, the Compensation and Benefits Committee of the Board of Directors modified the terms of performance share units originally awarded or granted in 2013, 2014 and 2015 to reflect the impact of removing Venezuela operations from the Company’s segment results beginning in 2015. For each of the affected performance share units, consolidated results for 2015 and each subsequent year within the respective performance period was or will be adjusted to reflect Venezuela results at the amount originally projected in the applicable performance target. No incremental compensation cost associated with the modification is expected to be recognized as the modified goal is expected to be more difficult to achieve and, in accordance with FASB ASC Topic 718, Compensation - Stock Compensation, we continue to recognize expense as calculated using the original performance goal.

Compensation expense are classified as selling, general and administrative expenses in the consolidated statements of operations. Compensation expenses for the share-based awards were as follows:



	Compensation Expense
	Three Months Ended March 31,
(in millions)	2016			2015

Performance Share Units	$	1.3		2.5
Market Share Units	0.2			1.6
Restricted Stock Units	1.1			1.0
Deferred Stock Units	0.2			0.1
Share-based payment expense	2.8			5.2
Income tax benefit	(1.0		)	(1.8	)
Share-based payment expense, net of tax	$	1.8		3.4

Restricted Stock Units (“RSUs”)

We measure the fair value of RSUs based on the price of Brink’s stock at the grant date, adjusted for a discount for dividends not received or accrued during the vesting period.

The following table summarizes RSU activity during the first three months of 2016:



	Shares (in thousands)		Weighted-Average Grant-Date Fair Value
Nonvested balance as of December 31, 2015	273.0		$	26.16
Granted	130.2		28.38
Forfeited	(8.8	)	25.42
Vested	(60.1	)	26.46
Nonvested balance as of March 31, 2016	334.3		$	26.99

Performance Share Units ("PSUs”)

In 2016, we granted Internal Metric PSUs ("IM PSUs") as well as Total Shareholder Return PSUs ("TSR PSUs").

IM PSUs contain solely a performance condition. We measure the fair value of these PSUs based on the price of Brink’s stock at the grant date, adjusted for a discount for dividends not received or accrued during the vesting period. For the IM PSUs granted in 2016, the performance period is from January 1, 2016 to December 31, 2017, with an additional year of service required.

TSR PSUs contain solely a market condition. We measure the fair value of these PSUs at the grant date using a Monte Carlo simulation model. The following table provides the terms and the weighted average assumptions used in the valuation of the TSR PSUs:



Terms and Assumptions Used to Estimate Fair Value of TSR PSUs	TSR PSUs Granted in the First Three Months of 2016
Date of Measurement	February 24, 2016^(a)

Terms of awards:
Performance period	Jan. 1, 2016 to
	Dec. 31, 2018
Beginning average price of Brink’s common stock	$	29.79

Assumptions used to estimate fair value:
Expected dividend yield^(b)	0		%
Expected stock price volatility	29		%
Risk-free interest rate	0.9		%
Contractual term in years	2.9

Weighted-average fair value estimate per share	$	33.58


(a)	Represents the accounting grant date that awards granted to employee.


(b)	TSR PSUs are not entitled to dividends during the performance period.

The following table summarizes all PSU activity during the first three months of 2016:



	Shares (in thousands)		Weighted-Average Grant-Date Fair Value
Nonvested balance as of December 31, 2015	503.4		$	25.93
Granted	166.5		29.22
Forfeited	(9.4	)	27.19
Vested^(a)	(162.9	)	23.73
Nonvested balance as of March 31, 2016	497.6		$	27.73


(a)	The vested PSUs presented are based on the target amount of the award. Pursuant to the actual performance for the period ended December 31, 2015, the actual shares earned and distributed were 277.1, representing 171% of target or, for a smaller award, 125% of target.

Market Share Units ("MSUs”)

The following table summarizes all MSU activity during the first three months of 2016:



	Shares (in thousands)		Weighted-Average Grant-Date Fair Value
Nonvested balance as of December 31, 2015	258.8		$	27.40
Granted	—		—
Forfeited	—		—
Vested^(a)	(84.3	)	27.30
Nonvested balance as of March 31, 2016	174.5		$	27.45


(a)	The vested MSUs presented are based on the target amount of the award. Pursuant to the actual performance for the period ended December 31, 2015, the actual shares earned and distributed were 91.1, or 108% of target. No additional compensation expense was required, as the market condition was included in the $27.30 grant date fair value.

Deferred Stock Units ("DSUs")

We measure the fair value of DSUs at the grant date, based on the price of Brink's stock.

In 2015, our independent directors received grants of DSUs that vest and will be paid out in shares of Brink's stock on the first anniversary of the grant date, provided that the director has not elected to defer the distribution of shares until a later date. DSUs are forfeited if a director leaves before the vesting date. However, in connection with the retirement of two directors in January 2016, our board of directors waived the one-year vesting provision for those DSUs granted in 2015. The impact of this modification was recorded in the first quarter of 2016 and was not significant.

DSUs granted prior to 2015, in general, will be paid out in shares of stock following separation from service.

The following table summarizes all DSU activity during the first three months of 2016:



	Shares (in thousands)		Weighted-Average Grant-Date Fair Value
Nonvested balance as of December 31, 2015	21.4		$	32.79
Granted	—		—
Forfeited	—		—
Vested	(6.1	)	29.05
Nonvested balance as of March 31, 2016	15.3		$	32.79