Stock-Based Compensation

We currently issue equity awards under the CoreLogic, Inc. 2011 Performance Incentive Plan (the “Plan”) which was approved by our stockholders at our Annual Meeting held on May 19, 2011. The Plan permits the grant of RSUs, PBRSU, stock options, stock appreciation rights, stock bonuses and other forms of awards granted or denominated in our common stock, as well as cash bonus awards. The Plan was adopted, in part, to make an additional 18,000,000 shares of the Company's common stock available for award grants, so we have sufficient authority and flexibility to adequately provide for future incentives. Prior to the approval of the Plan, we issued share-based awards under the CoreLogic, Inc. 2006 Incentive Plan (the “2006 Plan”).

We primarily utilize RSUs, PBRSUs and stock options as our share-based compensation instruments for employees and directors. The fair value of any share-based compensation instrument grant is based on the market value of our shares on the date of grant and is recognized as compensation expense over its vesting period.

Restricted Stock Units

For the six months ended June 30, 2013 and 2012, we awarded 664,116 and 718,315 RSUs, respectively, with an estimated grant date fair value of $17.2 million and $11.9 million, respectively. The RSU awards will vest ratably over three years.

RSU activity for the six months ended June 30, 2013 is as follows:



	Number of		Weighted Average Grant-Date
(in thousands, except weighted average fair value prices)	Shares		Fair Value
Unvested RSUs outstanding at December 31, 2012	1,381		$	17.50
RSUs granted	664		$	25.94
RSUs vested	(524	)	$	17.27
RSUs forfeited	(29	)	$	21.58
Unvested RSUs outstanding at June 30, 2013	1,492		$	21.25

As of June 30, 2013, there was $22.9 million of total unrecognized compensation cost related to unvested RSUs that is expected to be recognized over a weighted-average period of 2.2 years. The fair value of RSUs is based on the market value of the Company’s common stock on the date of grant.

Performance-Based Restricted Stock Units

For the six months ended June 30, 2013 and 2012, we awarded 397,443 and 345,348 PBRSUs, respectively, with an estimated grant date fair value of $10.3 million and $5.5 million, respectively. These awards could be subject to service-based, performance-based and market-based vesting. The performance period for the PBRSUs awarded during the six months ended June 30, 2013 is from January 1, 2013 to December 31, 2015 and the performance metric is adjusted earnings per share and market-based conditions. Based on satisfaction of the performance criteria, the 2013 awards will vest on December 31, 2015. The fair values of the 2013 awards were estimated using Monte-Carlo simulation with the following weighted-average assumptions.



	For the Six Months Ended
	June 30, 2013

Expected dividend yield	—	%
Risk-free interest rate ⁽¹⁾	0.39	%
Expected volatility ⁽²⁾	29.97	%
Average total shareholder return ⁽³⁾	13.01	%


(1)	The risk-free interest rate for the periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of the grant.


(2)	The expected volatility and average total shareholder return is a measure of the amount by which a stock price has fluctuated or is expected to fluctuate based primarily on our and our peers' historical data.


(3)	The average total shareholder return is the measure of performance of our stock over time.

The performance period for the PBRSUs awarded during the six months ended June 30, 2012 was from January 1, 2012 to December 31, 2012 and the performance metric was adjusted earnings per share. Based on satisfaction of the performance criteria, the 2012 awards were earned at 150% of target and will vest subject to continuation of employment until December 31, 2014. The fair value of the 2012 awards was based on the market value of the Company's common stock on the date of grant.

PBRSU activity for the six months ended June 30, 2013, is as follows:



	Number of		Weighted Average Grant-Date
(in thousands, except weighted average fair value prices)	Shares		Fair Value
Unvested PBRSUs outstanding at December 31, 2012	1,151		$	17.21
PBRSUs granted	397		$	25.90
PBRSUs vested	(156	)	$	18.18
PBRSUs forfeited	(40	)	$	17.51
Unvested PBRSUs outstanding at June 30, 2013	1,352		$	18.44

As of June 30, 2013, there was $18.4 million of total unrecognized compensation cost related to unvested PBRSUs that is expected to be recognized over a weighted-average period of 2.0 years. The fair value of PBRSUs is based on the market value of the Company's common stock on the date of grant.

Stock Options

In 2013 and 2012, we issued stock options as incentive compensation for certain key employees. The exercise price of each stock option is the closing market price of our common stock on the date of grant. The 2013 and 2012 options will vest in three equal annual installments on the first, second and third anniversaries of grant and expire ten years after the grant date. The fair values of these stock options were estimated using the Black-Scholes valuation model with the following weighted-average assumptions:



	For the Six Months Ended
	June 30,
	2013		2012
Expected dividend yield	—	%	—	%
Risk-free interest rate ⁽¹⁾	0.90	%	1.00	%
Expected volatility ⁽²⁾	41.65	%	42.81	%
Expected life ⁽³⁾	5.5		5.5


(1)	The risk-free interest rate for the periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of the grant.


(2)	The expected volatility is a measure of the amount by which a stock price has fluctuated or is expected to fluctuate based primarily on our and our peers' historical data.


(3)	The expected life is the period of time, on average, that participants are expected to hold their options before exercise based primarily on our historical data.

For the six months ended June 30, 2013 and 2012, we awarded 415,745 and 581,265 options, respectively, with an estimated fair value of $10.8 million and $9.3 million, respectively. Option activity for the six months ended June 30, 2013 is as follows:



(in thousands, except weighted average price)	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
Options outstanding at December 31, 2012	3,764		$	20.18
Options granted	416		$	25.90
Options exercised	(301	)	$	19.99
Options canceled	(108	)	$	18.28
Options outstanding at June 30, 2013	3,771		$	20.88	5.7	$	12,397
Options vested and expected to vest at June 30, 2013	3,716		$	20.86	5.6	$	12,235
Options exercisable at June 30, 2013	2,526		$	21.46	4.3	$	6,921

As of June 30, 2013, there was $7.1 million of total unrecognized compensation cost related to unvested stock options that is expected to be recognized over a weighted-average period of 2.0 years.

The intrinsic value of options exercised was $2.2 million and $0.3 million for the six months ended June 30, 2013 and 2012, respectively. This intrinsic value represents the difference between the fair market value of the Company’s common stock on the date of exercise and the exercise price of each option.

Employee Stock Purchase Plan

The 2012 employee stock purchase plan allows eligible employees to purchase our common stock at 85.0% of the closing price on the last day of each quarter. Our 2012 employee stock purchase plan was approved by our stockholders at our 2012 annual meeting of stockholders and the first offering period commenced in October 2012. We recognized an expense for the amount equal to the discount during the last offering period.

The following table sets forth the stock-based compensation expense recognized for the three and six months ended June 30, 2013 and 2012.



	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
(in thousands)	2013		2012		2013		2012
RSUs	$	3,834	$	2,575	$	7,302	$	4,788
PBRSUs	3,400		1,164		7,188		2,524
Stock options	1,445		938		2,128		1,719
Employee stock purchase plan	112		—		315		—
	$	8,791	$	4,677	$	16,933	$	9,031