The Cato Corporation (CATO) 10-Q 2022 Q2 Quarterly report

1

lorem ipsum

FIRST AMENDMENTTO CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AGREEMENT

(this “Amendment”), dated as

of June 6, 2022, is by and amongTHE CATOCORPORATION, a Delaware corporation (the

“Borrower”), the Banks (as defined below) party hereto and WELLSFARGO BANK, NATIONAL

ASSOCIATION, as agent on behalf of the Banks under the Credit Agreement (as hereinafter defined)

(in such capacity, the “Agent”).Capitalized termsused herein and not otherwise defined herein shall

have the meanings ascribed thereto in the Credit Agreement.

W I T N E S S E T H

WHEREAS

, the Borrower, certain Domestic Subsidiaries of the Borrower as may be from

time to time party thereto, certain banks and financial institutionsfrom time to time party thereto (the

“Banks”) and the Agent are parties to that certain Credit Agreementdated as of May 19, 2022 (the

“Credit Agreement”);

WHEREAS

, the Agent has requested that the Borrower amend certain provisionsof the Credit

Agreement; and

WHEREAS

, the Borrower is willing to make such amendments to the Credit Agreement,in

accordance with and subject to the terms and conditions set forth herein.

NOW,THEREFORE

, in consideration of the agreements hereinafter set forth, and for other

good and valuable consideration, the receipt and adequacy of which are herebyacknowledged, the

parties hereto agree as follows:

ARTICLE I

AMENDMENTSTO CREDIT AGREEMENT

1.1

Amendment to Definition of Interest Period

.The definition of Interest Period set

forth in Section 1.01 of the Credit Agreement is hereby amended bydeleting (i) “second,” from the

first sentence and (ii) clause (C)(2) in its entirety.

1.2

Amendment to Section 2.02

.Clauses (a), (a)(iv), (e), and (f) set forth in Section 2.02

of the Credit Agreement are hereby amended and restated in their entiretyto read as follows:

(a)

Borrower shall give the Agent notice in the form attached hereto as Exhibit B (a

“Notice of Borrowing”) prior to (i) 11:00 A.M. (Winston-Salem, North Carolina time) on the

same Domestic Business Day of each Base Rate Borrowing or Daily Simple SOFR Borrowing,

and (ii) 11:00 A.M. (Winston-Salem, North Carolinatime) on the day which is three (3)

Domestic Business Days prior to each Term SOFR Loan Borrowing, specifying:

(iv) in the case of a Term SOFR Borrowing, the duration of the Interest Period

applicable thereto, subject to the provisions of the definition of Interest Period.

2

(e) Borrower shall elect the initial Interest Period to a Term SOFR Loan by its Notice

of Borrowing given to the Agent pursuant to Section 2.02(a) above.Borrower shall elect the

duration of each succeeding Interest Period by giving written notice to the Agent of such

duration not later than 11:00 A.M. (Winston-Salem, North Carolina time) on the day which is

three (3) Domestic Business Days prior to the last day of the then current Interest Period

applicable to such Term SOFR Loan. If the Agent does not receive timely notice of the Interest

Period elected by Borrower,Borrower shall be deemed to have elected to continue such Term

SOFR Loan at a rate based upon Daily Simple SOFR as of the last dayof the Interest Period

applicable to such Term SOFR Loan subject to Section 2.02(f) below.

(f) Borrower may, on the last Domestic Business Day of the then current Interest

Period applicable to any outstanding Term SOFR Loan, or on any Domestic Business Day

with respect to Base Rate Loans or Daily Simple SOFR Loans, convert (i) any such SOFR

Loan into Daily Simple SOFR Loan and/or a Base Rate Loan, (ii)any such Base Rate Loan to

a SOFR Loan or (iii) any Daily Simple SOFR Loan into a Base Rate Loanor a Term SOFR

Loan, in each case, in the same aggregate principal amount, provided that at the Agent’s

option, no conversion of a Base Rate Loan to a Term SOFR Loan shall be made, and no new

Term SOFR Loan shall be made, during the continuance of an Event of Default.If Borrower

desires to convert a SOFR Loan or Base Rate Loan, Borrower shall give the Agent written

notice by no later than 3:00 p.m. (Winston-Salem, North Carolina time) (i) on the day which is

three (3) Domestic Business Days prior to the date on which such conversion is to a Term

SOFR Loan, or (ii) on the same Domestic Business Day on which such conversionis to a Base

Rate Loan or Daily Simple SOFR Loan, specifying, in each case, the dateof such conversion,

the SOFR Loan(s) or Base Rate Loan(s) to be converted and if the conversionis to a Term

SOFR Loan, the duration of the first Interest Period therefor.

1.3

Amendment to Section 2.06

.Clauses (b), (c), (d), and (f) set forth in Section 2.06 of

the Credit Agreement are hereby amended and restated in their entiretyto read as follows:

(b)

Base Rate Loans shall bear interest on the outstanding principal amount thereof

at a rate per annum equal to the Base Rate plus the Applicable Margin.Any overdue principal

of and, to the extent permitted by applicable law, overdue interest on any Base Rate Loan shall

bear interest, payable on demand, for each day until paid in full at a rate per annum equal to

the Default Rate.

(c)

Daily Simple SOFR Loans shall bear interest on the outstanding principal

amount thereof at a rate per annum equal to Daily Simple SOFR plus the Applicable Margin.

Any overdue principal of and, to the extent permitted by applicable law, overdue interest on

any Daily Simple SOFR Loan shall bear interest, payable on demand, for each day until paid

in full at a rate per annum equal to the Default Rate.

(d)

During each Interest Period in which a Revolving Credit Advance is a Term

SOFR Loan, such Term SOFR Loan shall bear interest on the outstanding principal amount

thereof, for the Interest Period applicable thereto, at a rate per annum equal to Term SOFR on

the first day of the applicable Interest Period plus the Applicable Margin.Any overdue

principal of and, to the extent permitted by law, overdue interest on any TermSOFR Loan

shall bear interest, payable on demand, for each day until paid at a rate per annum equal to

the Default Rate.

(e)

Interest on each Base Rate Loan, Daily Simple SOFR Loan, and Term SOFR

Loan shall be payable on the applicable Interest Payment Date.Notwithstanding the

foregoing, (1) all accrued unpaid interest on the Revolving Credit Advances shall be paid in

3

full on the Termination Date; and (2) should the Revolving Credit Commitment be terminated

at any time prior to the Termination Date for any reason, any and all accrued unpaid interest

shall be paid on the date of such termination.

1.4

Amendment to Exhibit B

.Exhibit B of the Credit Agreement is hereby deleted in its

entirety and replaced with the Notice of Borrowing attached hereto as ScheduleI.

ARTICLE II

CONDITIONS TOEFFECTIVENESS

This Amendment shall become effective as of the day and year set forth above(the “First

Amendment Effective Date”) when the Agent shall have received a copy of thisAmendment duly

executed by each of the Borrower, the Banks and the Agent.

ARTICLE III

MISCELLANEOUS

3.1

Amended Terms.

On and after the First Amendment Effective Date, all references to

the Credit Agreement in each of the Loan Documents shall hereafter meanthe Credit Agreement as

amendedbythisAmendment.

Exceptasspecifically amendedherebyorotherwiseagreed,the

Credit Agreementisherebyratifiedandconfirmedandshallremaininfullforceandeffect

accordingtoits terms.

3.2

Reaffirmation of Obligations.

The Borrower hereby ratifies the Credit Agreementas

amended by this Amendment and acknowledges and reaffirms (a) that it is boundby all terms of the

Credit Agreement as so amended applicable to it and (b) thatit is responsible for the observance and

full performance of its Obligations.

3.3

Loan Document.

This Amendment shall constitute a Loan Document under the terms

of the Credit Agreement.

3.4

Further Assurances.

The Borrower agrees to promptly take such action, upon the

request of the Agent, as is necessary to carry out the intent of this Amendment.

3.5

Entirety.

This Amendment and the other Loan Documents embody the entire

agreement among the parties hereto relating to the subject matter hereof andthereof and supersede all

previous documents, agreements and understandings, oral or written,relating to the subject matter

hereof and thereof.

3.6

Counterparts; Telecopy.

This Amendment may be executed in counterparts (and by

different parties hereto in different counterparts), each of which when so executed and deliveredwill

constitute an original, but all of which when taken together will constitutea single contract.Delivery

of an executed counterpart to this Amendment by telecopy or other electronicmeans shall be effective

as an original and shall constitute a representation that an original willbe delivered.

3.7

No Actions, Claims, Etc.

As of the date hereof, the Borrower hereby acknowledges

and confirms that it has no knowledge of any actions, causes of action,claims, demands, damages and

liabilities of whatever kind or nature, in law or in equity, against the Agent, the Banks, or the Agent’s

or the Banks’ respective officers, employees,representatives, agents, counsel or directors arising from

4

any action by such Persons, or failure of such Persons to act under theCredit Agreement on or prior to

the date hereof.

3.8

NORTH CAROLINA LAW.THIS AMENDMENT SHALL BE CONSTRUED

IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATEOF NORTH

CAROLINA.

3.9

Successors and Assigns.

This Amendment shall be binding upon and inure to the

benefit of the parties hereto and their respective successors and assigns.

3.10

Expenses.

Notwithstanding the provisions of Section 9.03 of the Credit Agreement,

each party hereto agrees that it shall be responsible for its own expenses,including without limitation

fees and disbursements of counsel, in connection with this Amendment.

3.11

Consent to Jurisdiction; Service of Process; Waiver of Jury Trial.

The

jurisdiction, service of process and waiver of jury trial provisions setforth in Section 9.16 of the Credit

Agreement are hereby incorporated by reference,

mutatis mutandis.

[REMAINDER OF PAGE INTENTIONALLYLEFT BLANK]

5

IN WITNESS WHEREOF the parties heretohave caused this Amendment to be dulyexecuted on

the date first above written.

BORROWER:

THE CATOCORPORATION

By:_/s/ Charles D. Knight________________________

Charles D. Knight

Executive Vice President and Chief Financial Officer

6

AGENT:

WELLS FARGO BANK, NATIONALASSOCIATION,

as Agent, Issuing Bank and as a Bank

By:_/s/ Brad D. Bostick__________________

Name: Brad D. Bostick:

Title: Senior Vice President

7

SCHEDULE I

EXHIBIT B

NOTICE OF BORROWING

____________, 20__

To:Wells Fargo Bank, National Association

Re:Credit Agreement (as amended and modified from time to time, the “Credit Agreement”)

dated as of May 19, 2022 among The Cato Corporation, the InitialGuarantors, Wells

Fargo Bank, National Association, as Issuing Bank and Agent and the Bankslisted on the

signature pages thereof

Ladies & Gentlemen:

Unless otherwise defined herein, capitalized terms used herein shall havethe meanings

attributable thereto in the Credit Agreement.

This Notice of Borrowing is delivered to you pursuant to Section 2.02of the Credit

Agreement.

The Borrower hereby requests a [Daily Simple SOFR Borrowing] [Term SOFR

Borrowing] [Base Rate Borrowing] in the aggregate principal amount of$____________ to be made on

____________, 20__, and for interest to accrue thereon at the rate establishedby the Credit Agreement

for [Daily Simple SOFR Loans] [Term SOFR Loans] [Base Rate Loans].[If Term SOFR Borrowing, the

duration of the Interest Period with respect thereto shall be [1 month][3 months] [6 months]].

The Borrower has caused this Notice of Borrowing to be executed and deliveredby its

duly authorized officer this _____ day of ____________, 20__.

THE CATOCORPORATION

By:

Title: