CATO CORP
AGREEMENT DATED AS OF AUGUST 29,2003, EDGAR
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<TYPE>EX-10.2
<SEQUENCE>4
<FILENAME>g84909exv10w2.htm
<DESCRIPTION>AGREEMENT DATED AS OF AUGUST 29,2003, EDGAR
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<TITLE>Agreement Dated as of August 29,2003, Edgar</TITLE>
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<P align="right"><FONT size="2">Page 27 </FONT>


<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

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    <TD valign="top"><FONT size="2">STATE OF NORTH CAROLINA</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
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    <TD valign="top"><FONT size="2">COUNTY OF MECKLENBURG</FONT></TD>
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<B>AGREEMENT</B></FONT></TD>
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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS AGREEMENT (the &#147;Agreement&#148;), is made and entered into as of the 29th
day of August, 2003 (the &#147;Effective Date&#148;) by and between The Cato Corporation,
a Delaware corporation (the &#147;Company&#148;), and Edgar T. Cato (&#147;Edgar Cato&#148;).
</FONT>
<P align="center"><FONT size="2"><B>W I T N E S S E T H:</B>
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>WHEREAS,</B> Edgar Cato is an employee and director of the Company; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>WHEREAS, </B>the Company and Edgar Cato have negotiated and agreed on the
terms of
this Agreement providing for his resignation as an employee and director of the
Company and
for the ongoing obligation of the parties following the effective date of this
Agreement and his retirement from the Company.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>NOW, THEREFORE,</B> the parties, intending legally to be bound, hereby agree
to the mutual terms and conditions set forth below:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Continued Services and Retirement.</B> Edgar Cato shall continue to serve
as an employee and as a director of the Company to January&nbsp;31, 2004 (the
&#147;Retirement Date&#148;) at
which time his resignation as an employee and director shall be effective and
he shall retire and relinquish all positions and responsibilities with the
Company and its subsidiaries and affiliates (the &#147;Cato Group&#148;) except as
specifically set forth herein. Provided, that Edgar Cato shall be entitled, at
his option, to resign as a director prior to January&nbsp;31, 2004 without affecting
the obligations of the Company set forth herein.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Continuing Obligations of Edgar Cato.</B> In consideration of the benefits
to Edgar Cato set forth in paragraph 3 hereof, Edgar Cato shall comply with the
following obligations to the Cato Group following the Retirement Date:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. <B>Confidentiality of Company Information.</B> Edgar Cato acknowledges
the confidential and proprietary nature of the Confidential Information of the
Cato Group and agrees that he will not, without the prior, express written
consent of the Chief Executive Officer
of the Company, directly or indirectly:
</FONT>

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    <TD width="1%" align="left" nowrap><FONT size="2">(i)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">use or disclose any Confidential Information
outside the Cato Group
except as required by law,</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(ii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">publish any article with respect thereto,</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">except in the performance of services to the
Cato Group, remove from the premises of the Company, or aid in
such removal, any such Confidential</FONT></TD>
</TR>
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<P align="right"><FONT size="2">Page 28 </FONT>






<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

<P>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="93%"><FONT size="2">Information or any property or material related thereto
(except as
authorized under subparagraph D below), or</FONT></TD>
</TR>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
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<TR valign="top">
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iv)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">sell, exchange or give away or otherwise dispose
of any such Confidential Information now or hereafter owned by
the Company.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, &#147;Confidential Information&#148; means and
includes any and
all of the following (whether or not documented):
</FONT>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(i)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">vendor information, including but not limited to
names of vendors, vendor transaction information, and billing,
purchasing or credit history
information about vendors;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(ii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">financial information, including but not limited
to, financial statements, balance sheets, profit and loss
statements, earnings, commissions, benefits and salaries paid
to employees, sales data and projections, sales and
income forecasts, cost analyses, pricing information,
business goals and projections, equipment and inventory data,
profit margins, and similar information;</FONT></TD>
</TR>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iii)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">all sources and methods of supply, including but
not limited to supplier
lists, business arrangements, buying and inventory
techniques, supply
terms, supply and manufacturing contracts, purchasing
discounts, distribution agreements, and similar information;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(iv)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">all plans and projections for business
opportunities for new or developing business, including but
not limited to, marketing concepts, business plans,
merchandising and marketing techniques, store leases, store
site selection and location plans and processes, real estate
activities, real
estate/expansion information, advertising strategies, product
lines, store development, and sales plans;</FONT></TD>
</TR>
<TR>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(v)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">all information relating to costs, research and
development activities,
service performance, quality control measures or strategies,
loss
prevention measures, operating results, pricing strategies,
employee lists
and other confidential or proprietary information, software,
designs,
patents, ideas, machinery, plans, know-how and trade secrets;</FONT></TD>
</TR>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">(vi)</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">all other confidential or trade secret
information that is used, or is
designed to be used in the business of the Cato Group or
results from its research or development activities.</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">Confidential Information shall not include information that is generally known
or available to the public or the industry other than as a result of disclosure
by Edgar Cato.
</FONT>

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<P align="right"><FONT size="2">Page 29 </FONT>


<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. <B>Non-solicitation of Cato Group Employees.</B> Edgar Cato agrees that he
will not, during the period of time through January&nbsp;31, 2007, (i)&nbsp;solicit for
employment, offer employment to, engage as an employee, independent contractor
or in any manner induce or seek
to induce any person who is a managerial or administrative employee of the Cato
Group to
become employed by or engaged as an independent contractor with someone other
than the Cato Group, (ii)&nbsp;solicit or encourage any such employee to terminate
his or her employment with the Cato Group, or (iii)&nbsp;otherwise interfere with
any such employee&#146;s relationship with the Cato Group. Provided, that the
foregoing prohibition shall not apply to the employees currently assigned to
the non-executive Chairman&#146;s office (namely, Theresa Gebhardt, Sylvia Remeta
and Debra Jones) all of whom are anticipated to remain employees of the Company
only through December&nbsp;31, 2003.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. <B>Non-Competition.</B> Edgar Cato agrees that for the period of time through
January&nbsp;31, 2007 (the &#147;Restricted Period&#148;) he will not, directly or indirectly,
in the Restricted
Area (as defined below), Compete (as defined below) with the Cato Group.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, the &#147;Restricted Area&#148; means the area
within a twenty-five (25)&nbsp;mile radius of any retail store under development,
operation or ownership by
any member of the Cato Group during the Restricted Period.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For purposes of this Agreement, &#147;Compete&#148; means to engage in any business
activity whatsoever related in any manner or fashion to the operation of retail
stores that sell or offer to sell value-priced women&#146;s apparel or accessories.
Without limiting the generality of the foregoing, Edgar Cato will not, directly
or indirectly (whether for compensation or otherwise), alone or as an agent,
principal, partner, officer, employee, trustee, director, shareholder or in any
other capacity, own, manage, operate, join, control or participate in the
ownership, management, operation or control of, or furnish any capital to, or
be connected in any manner with, or provide any services as a consultant for,
any business which Competes with the Cato Group in the Restricted Area;
provided, however, that notwithstanding the foregoing, nothing contained in
this letter shall be deemed to (i)&nbsp;preclude Edgar Cato from owning not more
than 5% of the publicly traded securities of any entity which Competes with the
Cato Group or (ii)&nbsp;to preclude Edgar
Cato from owning or having an ownership interest in shopping centers or
buildings which may lease property to businesses that compete with the Cato
Group.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. <B>Office Relocation.</B> No later than the Retirement Date, Edgar Cato will
relocate his office from the Company premises. Edgar Cato shall be entitled to
remove all or any part of the property listed on Schedule&nbsp;1 from the Company
premises without reimbursement or payment to the Company.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Obligations of the Company.</B> In consideration of the obligations of
Edgar Cato
to the Cato Group set forth in paragraph 2 of the Agreement, the Company shall
comply with the following obligations to Edgar Cato:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. <B>Salary and Benefits.</B> The Company will continue Edgar Cato&#146;s current
salary and benefits through January&nbsp;31, 2004. In the event of Edgar Cato&#146;s
death prior to
January&nbsp;31, 2004, the Company will continue to pay his salary to his estate to
January&nbsp;31, 2004.
</FONT>

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<P align="right"><FONT size="2">Page 30 </FONT>





<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. <B>Continuing Payments.</B> The Company will pay Edgar Cato the sum of
$50,000 per year during the three-year period commencing February&nbsp;1, 2004 in
equal monthly installments. In the event of Edgar Cato&#146;s death subsequent to
the Effective Date, the Company will pay Edgar Cato&#146;s estate a lump sum amount
equal to the then aggregate present value (determined using a discount rate
equal to the applicable federal short-term rate in effect under Section&nbsp;1274(d)
of the Internal Revenue Code for the month of his death) of the payments
payable pursuant to this subparagraph which remain unpaid to January&nbsp;31, 2007.
Such payment
to be made as soon as administratively feasible after his death.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. <B>Group Term Life Insurance.</B> For the three year period commencing on
the Retirement Date, the Company will continue to provide group term life
insurance to Edgar Cato comparable to that provided to him on January&nbsp;31, 2004.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. <B>Healthcare.</B> Following the Retirement Date and for the remainder of
Edgar Cato&#146;s life, the Company will provide Edgar Cato and his wife, Judith B.
Cato, with the same or comparable group healthcare coverage on the same
economic terms and conditions as it provides such coverage to its senior
executives. In the event Edgar Cato predeceases Judith B. Cato, the Company
will provide such coverage to her for her life (if she is married to Edgar Cato
at the time of his death).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. <B>Life Insurance Option.</B> By giving notice to the Company prior to the
Retirement Date, Edgar Cato shall have the option to purchase the following
life insurance
policies at their respective cash value:
</FONT>

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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">Prudential Policy #75247139<BR>
Principal Financial Group Policy #3270890</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company shall have no obligations to Edgar Cato following the
Effective
Date except as is specifically set forth in the Agreement; provided Edgar Cato
shall continue to
be entitled to any benefits due to him under the benefit plans listed on
Schedule&nbsp;2 attached
hereto.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Tax.</B> Edgar Cato acknowledges that income may be imputed to him in
connection with the receipt of the benefits provided under the Agreement and
that Edgar Cato will be responsible for the payment of all federal or state tax
liabilities, penalties, interest, tax payments
or tax judgments that could arise as a result of these benefits. The Company
may withhold from any amounts or benefits payable or provided under this
Agreement such federal, state and local taxes as are required to be withheld
pursuant to any applicable law or regulation.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Acknowledgements.</B> Edgar Cato acknowledges that he has carefully read
this Agreement, that he knows and understands the contents of this Agreement,
that he has consulted with a lawyer regarding this Agreement, and that he
executes this Agreement of his own free
will. Edgar Cato and the Company agree that the mutual consideration to the
parties hereto is
fair and reasonable.
</FONT>

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<P align="right"><FONT size="2">Page 31 </FONT>


<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Governing Law.</B> This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Notices.</B> Any notice or other communications to be given hereunder
shall be deemed to have been given or delivered when delivered by hand to the
individuals named below
or when deposited in the United States mail, registered or certified, with
proper postage and registration or certification fees prepaid, addressed to the
parties as follows (or to such other address as one party shall give the other
in the manner provided herein):
</FONT>
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    <TD width="6%"><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="90%"><FONT size="2">The Cato Corporation<BR>
8100 Denmark Road<BR>
P. O. Box 34216<BR>
Charlotte, NC 28234<BR>
Attention: Chief Executive Officer</FONT></TD>
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    <TD><FONT size="2">&nbsp;</FONT></TD>
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    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="1%" align="left" nowrap><FONT size="2">&nbsp;</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="93%"><FONT size="2">Mr.&nbsp;Edgar T. Cato<BR>
3985 Douglas Road<BR>
Miami, FL 33133-6508</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Entire Agreement.</B> This Agreement constitutes the entire agreement
between the parties pertaining to the subject matter contained herein and
supersedes any and all prior and contemporaneous agreements, representations,
promises, inducements and understandings of the parties. This written
Agreement cannot be varied, contradicted or supplemented by evidence of any
prior or contemporaneous oral or written agreements. Moreover, this written
Agreement
may not be later modified except by a further writing signed by a duly
authorized officer of the Company and Edgar Cato.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>IN WITNESS WHEREOF,</B> the parties have executed this Agreement as of the day
and year first above written.
</FONT>
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<TR valign="bottom">
    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">Edgar T. Cato</FONT></TD>
</TR>

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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD colspan="3" valign="top" align="left"><FONT size="2">THE CATO CORPORATION</FONT></TD>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
    <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
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    <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
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By:
</FONT></TD>
    <TD><FONT size="2">&nbsp;</FONT></TD>
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Its:
</FONT></TD>
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<P align="right"><FONT size="2">Page 32 </FONT>


<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

<P align="center"><FONT size="2"><B>Schedule&nbsp;1</B>
</FONT>

<P align="left"><FONT size="2">Office furniture currently located in Edgar Cato&#146;s office
</FONT>


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<P align="right"><FONT size="2">Page 33 </FONT>




<P align="right"><FONT size="2">Exhibit&nbsp;10.2&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>

<P align="center"><FONT size="2"><B>Schedule&nbsp;2</B>
</FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
    <TD width="1%" align="left" nowrap><FONT size="2">1.</FONT></TD>
    <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
    <TD width="96%"><FONT size="2">The Cato Corporation 401(k) Profit Sharing Plan</FONT></TD>
</TR>
</TABLE>

</BODY>
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