<PAGE>
As filed with the Securities and Exchange Commission on May 17, 1999
Registration No.333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CAPITAL ONE FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware 54-171854
(State or other jurisdiction (I.R.S. Employer of
incorporation or organization) Identification No.)
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2980 Fairview Park Drive, Suite 1300
Falls Church, Virginia 22042-4525
(Address, including zip code, of
Registrant's principal executive offices)
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CAPITAL ONE FINANCIAL CORPORATION
1999 STOCK INCENTIVE PLAN
(Full title of the plan)
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JOHN G. FINNERAN, JR., Esq.
Senior Vice President, General Counsel
and Corporate Secretary
2980 Fairview Park Drive, Suite 1300
Falls Church, Virginia 22042-4525
(703) 205-1000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
=========================================================================
Title of Security Amount to Proposed Proposed Amount of
to be Registered be Maximum Maximum Registration
Registered Offering Aggregate Fee
(1) Price Offering
Per Unit (2) Price
- -------------------------------------------------------------------------
Common Stock,
par value $.01 200,000 $167.0625 $33,412,500.00 $9,288.68
per share
=========================================================================
(1) Represents the maximum number of shares of Common Stock of Capital One
Financial Corporation (the "Company") that may be offered and sold
hereunder. The Common Stock being registered hereby includes associated
Preferred Stock Purchase Rights, which initially are attached to and traded
with the shares of the Registrant's Common Stock. Value attributable to
such rights, if any, is reflected in the market price of the Common Stock.
(2) The maximum offering price per share has been determined solely for the
purpose of calculating the registration fee pursuant to Rules 457(c) and
(h) under the Securities Act based on the average of the high and low
prices for the Common Stock reported on the New York Stock Exchange on May
10, 1999.
(3) The Rights are to purchase the Registrant's Cumulative Participating Junior
Preferred Stock. Until the occurrence of certain prescribed events, none of
which has occurred as of the date of this Registration Statement, the
Rights are not exercisable, are evidenced by the certificates representing
the Registrant's Common Stock, and will be transferred along with, and only
with, the Registrant's Common Stock.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I will be sent
or given to participants as specified by Rule 428(b)(1). Such documents are not
being filed with the Securities and Exchange Commission (the "Commission")
either as part of this Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424. Such documents and the documents incorporated
by reference in this Registration Statement pursuant to Item 3 of Part II of
this Form, taken together, constitute a prospectus that meets the requirements
of Section 10(a) of the Securities Act.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents have been filed by the Registrant with the
Commission and are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the year ended
December 31, 1998.
(b) The Registrant's Current Reports on Form 8-K filed January 19, 1999,
April 15, 1999, April 30, 1999 and May 5, 1999.
(c) The Registrant's Proxy Statement on Schedule 14A dated March 20, 1999
for its 1999 Annual Meeting provided, however, that the information
referred to in Item 402(a)(8) of Regulation S-K promulgated by the
Commission shall not be deemed to be specifically incorporated by
reference herein.
(d) The description of the Registrant's common stock on Amendment No. 1 to
Form 8-A dated October 17, 1994.
(e) The description of the Resgistrant's preferred stock purchase rights
on Form 8-A dated November 16, 1995.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be part
hereof from the date of filing of such documents. Any statement contained in any
such incorporated document shall be deemed to be modified or superseded for
purposes of this Registration Statement to the extent that a statement contained
in any other incorporated document subsequently filed (or in this Registration
Statement, with respect to an incorporated document filed prior to the filing
hereof), modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
<PAGE>
Item 5. Interests of Named Experts and Counsel.
John G. Finneran, Jr., Senior Vice President, General Counsel and Corporate
Secretary of the Registrant, who has rendered the opinion attached hereto as
Exhibit 5 holds 6,357 shares of Common Stock and options to purchase an
additional 112,857 shares of Common Stock issued under the Registrant's 1994
Stock Incentive Plan.
Item 6. Indemnification of Directors and Officers.
Under Section 145 of the General Corporation Law of the State of Delaware
(the "GCL"), a corporation may indemnify any person who was or is a party, or is
threatened to be made a party, to any action, suit or proceeding by reason of
the fact that he or she is or was a director or officer of such corporation if
such person acted in good faith and in a manner he or she reasonably believed to
be in and not opposed to the best interest of the corporation and, with respect
to a criminal action or proceeding, such person had no reasonable cause to
believe that his or her conduct was unlawful, except that, in the case of any
action or suit by or in the right of the corporation, no indemnification is
permitted if the person shall be adjudged liable to the corporation other than
indemnification for such expenses as a court shall determine such person is
fairly and reasonably entitled to.
Article XI of the Registrant's Restated Certificate of Incorporation and
Section 6.7 of the Registrant's By-laws provide, in general, for mandatory
indemnification of directors and officers to the fullest extent permitted from
time to time by the GCL or any other applicable law, against liability incurred
by them in proceedings instituted or threatened against them by third parties,
or by or on behalf of the Registrant itself, relating to the manner in which
they performed their duties unless they have been guilty of willful misconduct
or of a knowing violation of the criminal law.
Under Article X of the Registrant's Restated Certificate of Incorporation,
a director of the Registrant is not personally liable to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
Registrant or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the GCL, or (iv) for any transaction from which the director
derived an improper personal benefit.
The Registrant also maintains a directors and officers insurance policy
generally covering the activities for which such persons are entitled to
indemnification.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit Description Reference
Number ----------- ---------
-------
3.1 Restated Certificate of Incorporated by reference
Incorporation of Capital to Exhibit 3.1 of the
One Financial Corporation Registrant's Annual Report
on Form 10-K for the year
ended December 31, 1994
3.2 Restated Bylaws of Capital Incorporated by reference
One Financial Corporation to Exhibit 3.2 of the
(as amended January 24, Registrant's Annual Report
1995) on Form 10-K for the year
ended December 31, 1994
4 Capital One Financial Filed herewith
Corporation 1999 Stock
Incentive Plan
4.1 Rights Agreement, dated as of Incorporated by
November 16, 1995, between reference to the
Capital One Financial Registrant's
Corporation and First Chicago Current Report on
Trust Company of New York (as Form 8-K, filed
successor to Mellon Bank, November 16, 1995
N.A.), as Rights Agent
<PAGE>
4.2 Amendment Number 1 to Rights Incorporated by
Agreement, dated as of April reference to the
29, 1999, between Capital One Registrant's
Financial Corporation and Current Report on
First Chicago Trust Company Form 8-K, filed
of New York (as successor to May 5, 1999
Mellon Bank, N.A.), as Rights
Agent
5 Opinion of Counsel Filed herewith
23.1 Consent of Counsel Contained in
Exhibit 5 and
incorporated
herein by reference
23.2 Consent of Independent Filed herewith
Auditors
24 Power of Attorney Set forth on
signature page
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act").
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Securities and Exchange Commission pursuant to Rule
424(b) under the Securities Act if, in the aggregate, the changes
in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) will not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished
to the Securities and Exchange Commission by the Registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities
offered thereby, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d)
of the Exchange Act that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered thereby, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act and
will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Commonwealth of Virginia, on the 14th day of May, 1999.
CAPITAL ONE FINANCIAL CORPORATION
By /s/ John G. Finneran, Jr.
-------------------------------------------
John G. Finneran, Jr.
Senior Vice President, General Counsel
and Corporate Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints David M. Willey and John G. Finneran, Jr., Esq.
his true and lawful attorney-in-fact and agent, for him, with full power of
substitution and resubstitution, for him and in his name, place and stand, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all interests and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent or his substitute or substitutes may lawfully do or
cause to be done by virtue hereof.
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated below on the 14th day of May, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Richard D. Fairbank
- ------------------------------------- Director, Chairman and Chief Executive Officer
Richard D. Fairbank (Principal Executive Officer)
/s/ Nigel W. Morris
- ------------------------------------- Director, President and Chief Operating Officer
Nigel W. Morris
/s/ David W. Willey
- ------------------------------------- Senior Vice President, Corporate Financial
David M. Willey Management and Treasurer
(Principal Accounting and Financial Officer)
/s/ W. Ronald Dietz
- ------------------------------------- Director
W. Ronald Dietz
/s/ James A. Flick, Jr.
- ------------------------------------- Director
James A. Flick, Jr.
/s/ Patrick W. Gross
- ------------------------------------- Director
Patrick W. Gross
/s/ James V. Kimsey
- ------------------------------------- Director
James V. Kimsey
/s/ Stanley I. Westreich
- ------------------------------------- Director
Stanley I. Westreich
</TABLE>
<PAGE>
Exhibit Index
Exhibit Description Sequential
Number ----------- Page Number
------ -----------
4 Capital One Financial Corporation 1999 9
Stock Incentive Plan
5 Opinion of Counsel 20
23.2 Consent of Independent Auditors 21
<PAGE>
Exhibit 4
CAPITAL ONE FINANCIAL CORPORATION
1999 STOCK INCENTIVE PLAN
(Effective as of April 29, 1999)
1. Purpose. The purpose of the Capital One Financial Corporation 1999 Stock
Incentive Plan (the "Plan") is to further the long term stability and financial
success of Capital One Financial Corporation (the "Company") by attracting and
retaining employees and consultants of the Company through the use of stock
incentives. It is believed that ownership of Company Stock will stimulate the
efforts of those employees and consultants of the Company upon whose judgment
and interest the Company is and will be largely dependent for the successful
conduct of its business. It is also believed that Awards granted to such
employees and consultants under the Plan will strengthen their desire to remain
with the Company and will further the identification of those employees' and
consultants' interests with those of the Company's shareholders. The Plan was
adopted by the Board of Directors on April 29, 1999.
2. Definitions. As used in the Plan, the following terms have the meanings
indicated:
(a) "Award" means the award of an Option under the Plan.
(b) "Board" means the board of directors of the Company.
(c) "Change of Control" means:
(i) The acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act") of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 20% (or, if such shares are purchased from the Company, 40%) or
more of either (A) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (B) the combined
voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Company
Voting Securities"), provided, however, that any acquisition by (x)
the Company or any of its subsidiaries, or any employee benefit plan
(or related trust) sponsored or maintained by the Company or any of
its subsidiaries or (y) any corporation with respect to which,
immediately following such acquisition, more than 60% of,
respectively, the then outstanding shares of common stock of such
corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in
<PAGE>
the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Company Voting Securities
immediately prior to such acquisition in substantially the same
proportion as their ownership, immediately prior to such acquisition,
of the Outstanding Company Common Stock and Company Voting Securities,
as the case may be, shall not constitute a Change of Control; or
(ii) Individuals who constituted the Board as of January 1, 1999
(the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board, provided that any individual becoming a
director subsequent to January 1, 1999 whose appointment to fill a
vacancy or to fill a new Board position or whose nomination for
election by the Company's shareholders was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the Directors
of the Company (as such terms are used in Rule 14a-11 of Regulation
14A promulgated under the Exchange Act); or
(iii) Approval by the shareholders of the Company of a
reorganization, merger or consolidation (a "Business Combination"), in
each case, with respect to which all or substantially all of the
individuals and entities who were the respective beneficial owners of
the Outstanding Company Common Stock and Company Voting Securities
immediately prior to such Business Combination do not in the
aggregate, immediately following such Business Combination,
beneficially own, directly or indirectly, more than 60% of,
respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Business Combination in
substantially the same proportion as their ownership immediately prior
to such Business Combination of the Outstanding Company Common Stock
and Company Voting Securities, as the case may be; or
<PAGE>
(iv) (A) a complete liquidation or dissolution of the Company or
(B) sale or other disposition of all or substantially all of the
assets of the Company other than to a corporation with respect to
which, immediately following such sale or disposition, more than 60%
of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, in the aggregate by all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common
Stock and Company Voting Securities immediately prior to such sale or
disposition in substantially the same proportion as their ownership of
the Outstanding Company Common Stock and Company Voting Securities, as
the case may be, immediately prior to such sale or disposition.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means the committee appointed by the Board as
described under Section 13.
(f) "Company" means Capital One Financial Corporation, a Delaware
corporation, or any successor thereto.
(g) "Company Stock" means Common Stock of the Company or any
securities substituted for Common Stock of the Company pursuant to Section
12.
(h) "Date of Grant" means the date on which an Award is granted by the
Committee or such later date specified by the Committee as the date as of
which the Award is to be effective.
(i) "Disability" or "Disabled" and the existence thereof shall mean a
termination of employment due to a permanent and total disability under the
Company's Long Term Managed Income Protection program or any similar plan
as in effect from time to time, or if no such plan is in effect, then as
determined by the Committee (such determination to be conclusive).
(j) "Fair Market Value" means as of the date for which a value
determination is being made, the average of the Common Stock's highest and
lowest prices on such date as reported on The New York Stock Exchange
Composite Transactions Tape (or, if the New York Stock Exchange is not open
for trading on such date, for the last preceding day on which Company Stock
was traded). In the absence of any such sale, fair market value means the
average
<PAGE>
of the highest bid and lowest asked prices of a share of Company Stock on
such date as reported by such source. In the absence of such average or if
shares of Company Stock are no longer traded on The New York Stock
Exchange, the fair market value shall be determined by the Committee using
any reasonable method in good faith.
(k) "Option" means a right to purchase Company Stock granted under the
Plan, at a price determined in accordance with the Plan.
(l) "Participant" means any employee or consultant who receives an
Award under the Plan.
(m) "Reload Feature" means a feature of an Option described in a
Participant's stock option agreement that provides for the automatic grant
of a Reload Option in accordance with the provisions described in Section
7(d).
(n) "Reload Option" means an Option granted to a Participant equal to
the number of shares of already owned Company Stock delivered by the
Participant to exercise an Option described in Section 7(d).
(o) "Rule 16b-3" means Rule 16b-3 of the Securities Exchange Act of
1934. A reference in the Plan to Rule 16b-3 shall include a reference to
any corresponding rule (or number redesignation) of any amendments to Rule
16b-3 enacted after the effective date of the Plan's adoption.
(p) "Subsidiary" means a corporation or other entity more than 50% of
whose voting shares are owned directly or indirectly by the Company.
3. General. All Options granted under the Plan shall be non-statutory in
nature and shall not be entitled to special tax treatment under Code Section
422.
4. Stock. Subject to Section 12 of the Plan, there shall be reserved for
issuance under the Plan an aggregate of 200,000 shares of Company Stock, which
may be authorized but unissued shares or treasury shares. Shares granted under
the Plan subject to Options that expire or otherwise terminate unexercised may
again be subjected to an Award under the Plan. The Committee is expressly
authorized to make an Award to a Participant conditioned upon the surrender for
cancellation of an existing Award. For purposes of determining the number of
shares that are available for Awards under the Plan, such number shall include
the number of shares surrendered by a Participant or retained by the Company in
payment of federal and state income tax withholding liabilities upon exercise of
an Option.
<PAGE>
5. Eligibility.
(a) All employees and consultants of the Company (or a Subsidiary of
the Company) shall be eligible to receive Awards under the Plan, except for
directors of the Company. The Committee shall have the power and complete
discretion, as provided in Section 13, to select eligible persons to
receive Awards and to determine for each person the terms and conditions
and the number of shares to be allocated to each person as part of each
Award.
(b) The grant of an Award shall not obligate the Company or any
Subsidiary of the Company to pay a Participant any particular amount of
remuneration, to continue the employment or service of the Participant
after the grant or to make further grants to the Participant at any time
thereafter.
6. Stock Options.
(a) Whenever the Committee deems it appropriate to grant Options,
notice shall be given to the eligible person stating the number of shares
for which Options are granted, the Option exercise price per share and the
conditions to which the grant and exercise of the Options are subject. This
notice shall constitute the stock option agreement between the Company and
the eligible person.
(b) The exercise price of shares of Company Stock covered by an Option
shall be not less than 100% of the Fair Market Value of such shares on the
Date of Grant.
(c) Options may be exercised in whole or in part at such times as may
be specified by the Committee in the Participant's stock option agreement.
(d) The Committee may, in its discretion, grant Options which by their
terms become fully exercisable upon a Change of Control, notwithstanding
other conditions on exercisability in the stock option agreement.
(e) The maximum number of shares with respect to which Options may be
granted in any calendar year to any person eligible to participate in the
Plan shall be 500,000.
(f) The Committee may, in its discretion, grant Options containing, or
amend Options previously granted to provide for, a Reload Feature subject
to the limitations of Sections 6(e) and 7(d).
7. Method of Exercise of Options.
(a) Options may be exercised by the Participant in accordance with the
method or methods of exercise as may be approved from time to time by the
Committee. If the terms of an Option so permit, in lieu of delivering
payment for the exercise price in full in cash, the Participant may (i)
deliver Company Stock that the Participant has owned for at least six (6)
<PAGE>
months (valued at Fair Market Value on the date of exercise) in
satisfaction of all or any part of the exercise price, (ii) deliver a
properly executed exercise notice together with irrevocable instructions to
a broker to promptly deliver to the Company the amount of the sale or loan
proceeds to pay the exercise price, or (iii) deliver an interest bearing
promissory note payable to the Company, to the extent permitted by
applicable margin rules, in payment of all or part of the exercise price
together with such collateral as may be required by the Committee at the
time of exercise. The interest rate under any such promissory note shall be
equal to the minimum interest rate required at the time to avoid imputed
interest to the Participant under the Code.
(b) The Company may place on any certificate representing Company
Stock issued upon the exercise of an Option any legend deemed desirable by
the Company's counsel to comply with Federal or state securities laws, and
the Company may require of the Participant a customary written indication
of his investment intent. Until the Participant has made any required
payment, including any applicable Federal, state and local withholding
taxes, and has had issued to him a certificate (whether original,
book-entry or otherwise) for the shares of Company Stock acquired, he shall
possess no shareholder rights with respect to the shares.
(c) If a Participant exercises an Option that has a Reload Feature by
delivering already owned shares of Company Stock, the Participant shall
automatically be granted a Reload Option. The Reload Option shall be
subject to the following provisions:
(i) The Reload Option shall cover the number of shares of Company
Stock delivered by the Participant to the Company to exercise the
Option with the Reload Feature;
(ii) The Reload Option will not have a Reload Feature;
(iii) The exercise price of shares of Company Stock covered by a
Reload Option shall be 100% of the Fair Market Value of such shares on
the date the employee or consultant delivers shares of Company Stock
to the Company to exercise the Option that has a Reload Feature; and
(iv) The Reload Option shall be subject to the same restrictions
on exercisability as those imposed on the underlying Option
(possessing the Reload Feature).
The Committee may, in its discretion, cause the Company to place on any
certificate representing Company Stock issued to a Participant upon the exercise
of an underlying Option (possessing a Reload Feature as evidenced by the stock
<PAGE>
option agreement for such Option) delivered pursuant to this subsection (d), a
legend restricting the sale or other disposition of such Company Stock.
(d) Notwithstanding anything herein to the contrary, it is intended
that Awards be granted in such a manner as to conform to the provisions of
Rule 16b-3, or any replacement rule adopted, as the same now exists or may,
from time to time, be amended.
8. Applicable Withholding Taxes. As an alternative to making a cash payment
to the Company to satisfy tax withholding obligations, the Committee may
establish procedures permitting the Participant to elect to (a) deliver shares
of already owned Company Stock or (b) have the Company retain that number of
shares of Company Stock that would satisfy all or a specified portion of the
Federal, state and local tax liabilities of the Participant required to be
withheld as a result of exercising an Award. Any such election shall be made
only in accordance with procedures established by the Committee.
9. Transferability of Options. Options, by their terms, shall not be
transferable by the Participant except by will or by the laws of descent and
distribution and shall be exercisable, during the Participant's lifetime, only
by the Participant or by his guardian or legal representative. The Committee is
expressly authorized, in its discretion, to provide that all or a portion of an
Option may be granted to a Participant upon terms that permit transfer of the
Option in a form and manner determined by the Committee. Any person to whom an
Option is transferred pursuant to this Section 9 shall agree in writing to be
bound by the terms of the Plan and the stock option agreement for such Option as
if such transferee had been an original signatory thereto, and to execute and/or
deliver to the Committee any documents as may be requested by the Committee from
time to time.
10. Effective Date of the Plan. The Plan, having been adopted by the Board,
shall be effective on April 29, 1999. Until the requirements of any applicable
federal and state securities laws have been met, no Option shall be exercisable.
11. Termination, Modification, Change. If not sooner terminated by the
Board, the Plan shall terminate at the close of business on April 28, 2009. No
Awards shall be made under the Plan after its termination. The Board may
terminate the Plan or may amend the Plan in such respects as it shall deem
advisable, including amendments that the Board deems appropriate to ensure
compliance with applicable law. The termination or amendment of the Plan shall
not, without the consent of the Participant, detrimentally affect a
Participant's rights under an Award previously granted to him, except such
termination or amendment as the Board deems appropriate to ensure compliance
with applicable law. Notwithstanding the foregoing, the Board or the Committee
<PAGE>
may terminate any Award previously granted to a Participant and any agreement
relating thereto in whole or in part provided that upon any such termination the
Company in full consideration of the termination of any Award outstanding under
the Plan (whether or not exercisable) or portion thereof pays to such
Participant an amount in cash for each share of Company Stock subject to such
Award or portion thereof being terminated equal to the excess, if any, of (a)
the Fair Market Value of a share of Company Stock over (b) the sum of (i) the
exercise price per share of such Award and (ii) applicable withholding taxes and
other similar charges, or, if the Board or the Committee permits and the
Participant elects, accelerates the exercisability of such Participant's Award
or portion thereof (if necessary) and allows such Participant 30 days to
exercise such Award or portion thereof before the termination of such Award or
portion thereof.
12. Change in Capital Structure.
(a) In the event of a stock dividend, stock split or combination of shares,
spin-off, recapitalization or merger in which the Company is the surviving
corporation, a consolidation or a merger in which the Company is not the
surviving corporation, a transaction that results in the acquisition of
substantially all of the Company's outstanding stock by a single person or
entity, or a sale or transfer of substantially all of the Company's assets, or
other change in the Company's capital stock (including, but not limited to, the
creation or issuance to shareholders generally of rights, options or warrants
for the purchase of common stock or preferred stock of the Company), the
Committee (whose determination shall be binding on all persons) may take such
actions with respect to the Plan and any outstanding Options as the Committee
deems appropriate, including adjusting appropriately the number and kind of
shares of stock or securities of the Company to be subject to the Plan and to
Awards then outstanding or to be granted under the Plan, the maximum number of
shares or securities which may be delivered under the Plan or which may be
granted in a calendar year to an eligible person under the Plan, the exercise
price and any other relevant provisions. If the adjustment would produce
fractional shares with respect to any unexercised Option, the Committee may
adjust appropriately the number of shares covered by the Option so as to
eliminate the fractional shares.
(b) Notwithstanding anything in the Plan to the contrary, the Committee may
take the foregoing actions without the consent of any Participant, and the
Committee's determination shall be conclusive and binding on all persons for all
purposes.
13. Administration of the Plan. The Plan shall be administered by the
Committee consisting solely of two or more nonemployee directors of the Company
<PAGE>
(within the meaning of Rule 16b-3), who shall be appointed by the Board, unless
otherwise determined by the Board. The Committee shall have general authority to
impose any limitation or condition upon an Award the Committee deems appropriate
to achieve the objectives of the Award and the Plan and, in addition, and
without limitation and in addition to powers set forth elsewhere in the Plan,
shall have the following specific authority:
(a) The Committee shall have the power and complete discretion to determine
(i) which eligible employees and consultants shall receive an Award and the
nature of the Award, (ii) the number of shares of Company Stock to be covered by
each Award, (iii) whether to include a Reload Feature in an Option and to impose
limitations on the use of shares acquired through the exercise of a Reload
Option to exercise Options, (iv) the Fair Market Value of Company Stock, (v) the
time or times when an Award shall be granted, (vi) whether an Award shall become
vested over a period of time and when it shall be fully vested, (vii) when
Options may be exercised, (viii) whether a Disability exists, (ix) the manner in
which payment will be made upon the exercise of Options, (x) whether to approve
a Participant's election (A) to deliver shares of already owned Company Stock to
satisfy tax liabilities arising upon the exercise of an Option or (B) to have
the Company withhold from the shares to be issued upon the exercise or receipt
of an Award that number of shares necessary to satisfy tax liabilities arising
from such exercise or receipt, (xi) notice provisions relating to the sale of
Company Stock acquired under the Plan, and (xii) any additional requirements
relating to Awards that the Committee deems appropriate. The Committee shall
also have the power to amend the terms of previously granted Awards so long as
the terms as amended are consistent with the terms of the Plan and provided
that, except for such amendments as the Committee deems appropriate to ensure
compliance with applicable law, the consent of the Participant is obtained with
respect to any amendment that would be detrimental to him.
(b) The Committee may adopt rules and regulations for carrying out the
Plan. The interpretation and construction of any provision of the Plan by
the Committee shall be final and conclusive. The Committee may consult with
counsel, who may be counsel to the Company, and shall not incur any
liability for any action taken in good faith in reliance upon the advice of
counsel.
(c) A majority of the members of the Committee shall constitute a
quorum, and all actions of the Committee shall be taken by a majority of
the members present. Any action may be taken by a written instrument signed
by all of the members, and any action so taken shall be fully effective as
if it had been taken at a meeting.
<PAGE>
(d) The Board of Directors from time to time may appoint members
previously appointed and may fill vacancies, however caused, in the
Committee.
(e) No member of the Committee or the Board shall be liable for any
action, omission, or determination relating to the Plan, and the Company
shall indemnify and hold harmless each member of the Committee and each
other director, employee or consultant of the Company to whom any duty or
power relating to the administration or interpretation of the Plan has been
delegated against any cost or expense (including counsel fees) or liability
arising out of any action, omission or determination relating to the Plan,
to the maximum extent permitted by law.
14. Notice. All notices and other communications required or permitted to
be given under this Plan shall be in writing and shall be deemed to have been
duly given if delivered as follows: (a) if to the Company, delivery shall be
made personally or by first class mail, postage prepaid at its principal
business address to the attention of the Company's Director of Human Resources;
and (b) if to any Participant, personally, including by delivery through the
Company's internal electronic system with a return receipt requested or
interoffice mail system, or by first class mail, postage prepaid, at the last
known address of the Participant known to the sender at the time the notice or
other communication is sent.
15. Foreign Equity Incentive Plans. The Committee may authorize any foreign
Subsidiary or any foreign unincorporated division of the Company or of a
Subsidiary to adopt a plan for granting Awards (a "Foreign Equity Incentive
Plan"). All Awards granted under a Foreign Equity Incentive Plan shall be
treated as grants under the Plan. A Foreign Equity Incentive Plan shall have
such terms as the Committee permits; provided that such terms are not
inconsistent with the provisions of the Plan; and provided further that such
terms may be more restrictive than those in the Plan. Awards granted under a
Foreign Equity Incentive Plan shall be governed by the terms of the Plan except
to the extent that the terms of the Foreign Equity Incentive Plan are more
restrictive than the terms of the Plan, in which case such terms of the Foreign
Equity Incentive Plan shall control.
16. Substitute Award. The Committee may make a grant of an Award to an
employee or consultant of another corporation who becomes an employee or
consultant of the Company (or Subsidiary of the Company) by reason of a
corporate merger, consolidation, acquisition of stock or property,
reorganization, liquidation or similar transaction involving the Company (or
Subsidiary of the Company) in substitution for any award made by such
corporation. The terms and conditions of the substitute Award may vary from the
<PAGE>
terms and conditions required by the Plan and from those of the substituted
award. The Committee shall prescribe the provisions of the substitute Award.
17. Governing Law. The Plan shall be governed by, and interpreted in
accordance with, the law of the Commonwealth of Virginia.
<PAGE>
[CAPITAL ONE LETTERHEAD]
Exhibit 5
May 14, 1999
Board of Directors
Capital One Financial Corporation
2980 Fairview Park Drive, Suite 1300
Falls Church, Virginia 22042
Gentlemen:
As the General Counsel of Capital One Financial Corporation
(the "Company"), I have participated in the preparation of a Registration
Statement on Form S-8 to be filed with the Securities and Exchange Commission
pursuant to the Securities Act of 1933, as amended (the "Registration
Statement"), with respect to the registration of 200,000 shares of the Company's
common stock, par value $.01 per share, (the "Common Stock") authorized for
issuance upon the exercise of options granted under the Company's 1999 Stock
Incentive Plan (the "Plan"). I am familiar with the Registration Statement and
have examined such corporate documents and records, including the Plan, and such
matters of law as I have considered appropriate to enable me to render the
following opinion.
On the basis of the foregoing, I am of the opinion that the
shares of Common Stock have been duly authorized and when issued and sold
consistent with the terms of the Plan and the related resolutions of the Board
of Directors and the Compensation Committee, will be validly issued, fully paid
and non-assessable shares of the Company's Common Stock.
I hereby consent to the filing of this opinion as Exhibit 5 to
the Registration Statement and to the reference to me under the caption
"Interests of Named Experts and Counsel" in the Registration Statement.
Very truly yours,
/s/ John G. Finneran, Jr.
John G. Finneran, Jr., Esq.
General Counsel
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333- ) pertaining to the Capital One Financial Corporation 1999
Stock Incentive Plan of our report dated January 19, 1999, with respect to the
consolidated financial statements of Capital One Financial Corporation
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1998, filed with the Securities and Exchange Commission.
/s/ Ernst & Young, LLP
- ------------------------
Washington, D.C.
May 12, 1999
