Capital One 1999 Annual Report Download - page 59

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Under the Company’s Purchase Plan, associates of the
Company are eligible to purchase common stock through
monthly salary deductions of a maximum of 15% and a mini-
mum of 1% of monthly base pay. To date, the amounts deducted
are applied to the purchase of unissued common or treasury
stock of the Company at 85% of the current market price.
Shares may also be acquired on the market. An aggregate of
3,000,000 common shares has been authorized for issuance
under the Purchase Plan, of which 1,379,037 shares were avail-
able for issuance as of December 31, 1999.
On November 16, 1995, the Board of Directors of the Com-
pany declared a dividend distribution of one Right for each
outstanding share of common stock. As amended, each Right
entitles a registered holder to purchase from the Company one
three-hundredth of a share of the Company’s authorized Cumu-
lative Participating Junior Preferred Stock (the “Junior Preferred
Shares”) at a price of $200 per one three-hundredth of a share,
subject to adjustment. The Company has reserved 1,000,000
shares of its authorized preferred stock for the Junior Preferred
Shares. Because of the nature of the Junior Preferred Shares’
dividend and liquidation rights, the value of the one three-
hundredth interest in a Junior Preferred Share purchasable upon
exercise of each Right should approximate the value of one
share of common stock. Initially, the Rights are not exercisable
and trade automatically with the common stock. However, the
Rights generally become exercisable and separate certificates
representing the Rights will be distributed, if any person or group
acquires 15% or more of the Company’s outstanding common
stock or a tender offer or exchange offer is announced for the
Company’s common stock. Upon such event, provisions would
also be made so that each holder of a Right, other than the
acquiring person or group, may exercise the Right and buy com-
mon stock with a market value of twice the $200 exercise price.
The Rights expire on November 29, 2005, unless earlier
redeemed by the Company at $0.01 per Right prior to the time
any person or group acquires 15% of the outstanding common
stock. Until the Rights become exercisable, the Rights have no
dilutive effect on earnings per share.
In July 1997, the Company’s Board of Directors voted to
repurchase up to six million shares of the Company’s common
stock to mitigate the dilutive impact of shares issuable under its
benefit plans, including its Purchase Plan, dividend reinvestment
plan and stock incentive plans. In July 1998, the Company’s
Board of Directors voted to increase this amount by an addi-
tional 4.5 million shares of the Company’s common stock. For
the years ended December 31, 1999, 1998 and 1997, the Com-
pany repurchased 2,250,000, 2,687,400 and 3,955,923 shares,
respectively, under this program. Certain treasury shares have
been reissued in connection with the Company’s benefit plans.
note g
OTHER NON-INTEREST EXPENSE
Year Ended December 31, 1999 1998 1997
Professional services $ 145,398 $ 66,591 $ 47,671
Collections 101,000 59,503 23,216
Bankcard association
assessments 33,301 23,163 16,074
Fraud losses 22,476 10,278 16,749
Other 131,928 74,740 40,568
Total $ 434,103 $ 234,275 $ 144,278