Capital One 2001 Annual Report Download - page 57

Under the Company's Associate Stock Purchase Plan, associates of the
Company are eligible to purchase common stock through monthly
salary deductions of a maximum of 15% and a minimum 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 three million common shares has been
authorized for issuance under the Associate Stock Purchase Plan, of
which 847,582 shares were available for issuance as of December 31,2001.
On November 16, 1995, the Board of Directors of the Company
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 1/300th of a share of the
Company's authorized Cumulative Participating Junior Preferred
Stock (the “Junior Preferred Shares”) at a price of $200 per 1/300th of a
share, subject to adjustment. The Company has reserved one million
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 1/300th 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 common 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 and February 2000, the Company's Board of Directors
notes 55
A summary of the status of the Company's options as of December 31,2001, 2000 and 1999, and changes for the years then ended is presented below:
2001 2000 1999
Weighted- Weighted- Weighted-
Average Average Average
Options Exercise Price Options Exercise Price Options Exercise Price
(000s) Per Share (000s) Per Share (000s) Per Share
Outstanding at beginning of year 36,689 $ 30.57 37,058 $ 27.24 29,139 $ 15.99
Granted 21,114 49.93 4,063 51.14 10,541 55.71
Exercised (6,950) 12.29 (3,330) 12.20 (2,111) 11.44
Canceled (707) 55.89 (1,102) 49.79 (511) 38.17
Outstanding at end of year 50,146 $ 40.84 36,689 $ 30.57 37,058 $ 27.24
Exercisable at end of year 18,714 $ 23.25 22,108 $ 16.48 19,635 $ 12.16
Weighted-average fair value of
options granted during the year $29.73 $ 23.41 $ 25.92
The following table summarizes information about options outstanding as of December 31, 2001:
Options Outstanding Options Exercisable
Number Weighted-Average Weighted-Average Number Weighted-Average
Outstanding Remaining Exercise Price Exercisable Exercise Price
Range of Exercise Prices (000s) Contractual Life Per Share (000s) Per Share
$4.31–$6.46 199 3.10 years $ 6.11 199 $ 6.11
$6.47–$9.70 261 4.00 8.07 261 8.07
$9.71–$14.56 8,069 3.90 10.12 8,069 10.12
$14.57–$21.85 2,573 5.90 16.13 2,573 16.13
$21.86–$32.79 856 6.30 31.64 856 31.64
$32.80–$49.20 24,663 7.70 46.00 5,459 37.66
$49.21–$72.22 13,525 7.90 56.27 1,297 58.50