2.0.0.10 false Stock-Based Compensation 0208 - Disclosure - Stock-Based Compensation true false false false 1 usd $ false false Shares Standard http://www.xbrl.org/2003/instance shares xbrli 0 USD Standard http://www.xbrl.org/2003/iso4217 USD iso4217 0 USDEPS Divide http://www.xbrl.org/2003/iso4217 USD iso4217 http://www.xbrl.org/2003/instance shares xbrli 0 2 Stock-Based Compensation [Abstract] 0 us-gaap_ShareBasedCompensationAbstract us-gaap true na duration string No definition available. false false false false false true false false false false false false 1 false false false false 0 0 false false false No definition available. false 3 Stock-Based Compensation 1 us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock us-gaap true na duration string No definition available. false false false false false false false false false false false verboselabel false 1 false false false false 0 0   <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>8. Stock-Based Compensation</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Stock Option Plans</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">A summary of the changes in outstanding stock options is as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>Three Months Ended March 31,</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>2009</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Number of</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Weighted</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Number of</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Weighted</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Stock</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Average</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Stock</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Average</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Options</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Exercise Price</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Options</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Exercise Price</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding at beginning of period </div></td> <td> </td> <td> </td> <td align="right">24,262,692</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">12.51</td> <td> </td> <td> </td> <td> </td> <td align="right">26,728,119</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">10.35</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">3,895,000</td> <td> </td> <td> </td> <td> </td> <td align="right">13.10</td> <td> </td> <td> </td> <td> </td> <td align="right">3,025,000</td> <td> </td> <td> </td> <td> </td> <td align="right">12.03</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Exercised </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(126,387</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">6.53</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(392,028</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">2.23</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Forfeited </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(47,500</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">14.79</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(10,859</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">2.16</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="right" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding at end of period </div></td> <td> </td> <td> </td> <td align="right">27,983,805</td> <td> </td> <td> </td> <td> </td> <td align="right">12.61</td> <td> </td> <td> </td> <td> </td> <td align="right">29,350,232</td> <td> </td> <td> </td> <td> </td> <td align="right">10.62</td> <td> </td> </tr> <tr style="font-size: 1px"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td align="right" style="border-top: 3px double #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In June 2006, our shareholders approved the Hudson City Bancorp, Inc. 2006 Stock Incentive Plan (the “SIP Plan”) authorizing us to grant up to 30,000,000 shares of common stock. In July 2006, the Compensation Committee of the Board of Directors of Hudson City Bancorp (the “Committee”), authorized grants to each non-employee director, executive officers and other employees to purchase shares of the Company’s common stock, pursuant to the SIP Plan. Grants of stock options made through December 31, 2009 pursuant to the SIP Plan amounted to 18,887,500 options at an exercise price equal to the fair value of our common stock on the grant date, based on quoted market prices. Of these options, 5,535,000 have vesting periods ranging from one to five years and an expiration period of ten years. The remaining 13,352,500 shares have vesting periods ranging from two to three years if certain financial performance measures are met. Subject to review and verification by the Committee, we believe we attained these performance measures and have therefore recorded compensation expense for these grants. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2010, the Committee authorized stock option grants (the “2010 grants”) pursuant to the SIP Plan for 3,895,000 options at an exercise price equal to the fair value of our common stock on the grant date, based on quoted market prices. Of these options, 3,700,000 will vest in January 2013 if certain financial performance measures are met and employment continues through the vesting date (the “2010 Performance Options”). The remaining 195,000 options will vest in January 2011 (the “2010 Retention Options”). The 2010 grants have an expiration period of ten years. We have determined that it is probable these performance measures will be met and have therefore recorded compensation expense for the 2010 grants. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The fair value of the 2010 grants was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions<i>. </i>The dividend yield assumption for the 2010 grants was based on our current declared dividend as a percentage of the stock price on the grant date. The expected volatility assumption was calculated based on the weighting of our historical and rolling volatility for the expected term of the option grants. The risk-free interest rate was determined by reference to the continuously compounded yield on Treasury obligations for the expected term. The expected option life was based on historic optionee behavior for prior option grant awards. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As a result of low employee turnover, the assumption regarding the forfeiture rate of option grants had no effect on the fair value estimate. </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="5%"> </td> <td width="7%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center"><b>2010</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Retention Options</b></td> <td> </td> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Performance Options</b></td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Expected dividend yield </div></td> <td> </td> <td align="center" valign="top">4.57%</td> <td> </td> <td align="center" valign="top">4.57%</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected volatility </div></td> <td> </td> <td align="center" valign="top">41.30%</td> <td> </td> <td align="center" valign="top">34.58%</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Risk-free interest rate </div></td> <td> </td> <td align="center" valign="top">1.65%</td> <td> </td> <td align="center" valign="top">2.55%</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected option life </div></td> <td> </td> <td align="center" valign="top">3.6 years</td> <td> </td> <td align="center" valign="top">5.6 years</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Fair value of options granted </div></td> <td> </td> <td align="center" valign="top">$3.00</td> <td> </td> <td align="center" valign="top">$2.87</td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Compensation expense related to our outstanding stock options amounted to $2.6 million and $3.7 million for the three months ended March 31, 2010 and 2009, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Stock Awards</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2009, the Committee granted performance-based stock awards (the “2009 stock awards”) pursuant to the SIP Plan for 847,500 shares of our common stock. These shares were issued from treasury stock and will vest in annual installments over a three-year period if certain performance measures are met and employment continues through the vesting date. None of these shares may be sold or transferred before their January 2012 vesting date. We have determined that it is probable these performance measures will be met and have therefore recorded compensation expense for the 2009 stock awards. Expense for the 2009 stock awards is recognized over the vesting period and is based on the fair value of the shares on the grant date which was $12.03. In addition to the 2009 stock awards, grants were made in 2010 (the “2010 stock awards”) pursuant to the SIP Plan for 18,000 shares of our common stock. Expense for the 2010 stock awards is recognized over the vesting period of three years and is based on the fair value of the shares on the grant date which was $13.12. Total compensation expense for stock awards amounted to $1.2 million for both the three months ended March 31, 2010 and 2009, respectively. </div> </div>  <!-- Begin Block Tagged Note false false false Disclosure of compensation-related costs for share-based compensation which may include disclosure of policies, compensation plan details, allocation of stock compensation, incentive distributions, share-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. 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