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Form 11-K
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Annual Report Pursuant to Section 15(d) of
The Securities Exchange Act of 1934 (Fee Required)
X For the fiscal year ended September 30, 1995
or
Transition report Pursuant to Section 15(d) of
The Securities Exchange Act of 1934 (No Fee Required)
Commission File No. 0-3747
A. Full title of plan and address of the Plan, if
different from that of the issuer named below:
THE CATO CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
B. Name of issuer of the securities held pursuant to the
plan and the address of its principal executive office:
THE CATO CORPORATION
Human Resources Department
8100 Denmark Road
Charlotte, NC 28273
THE CATO CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
FORM 11-K
September 30, 1995
Table of Contents
Page
No.
Part I - Exhibit Index and Related Exhibits 2
Part II - Financial Information
Independent Auditors' Report 3-4
Statements of Net Assets 5
Statements of Changes in Net Assets 6
Notes to Financial Statements 7-8
Other Information 9
Independent Auditors' Consent 10
Page 2
THE CATO CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
INDEX
Form 11-K for the Year Ended September 30, 1995 and
---------------------------------------------------
the Eleven Month Period Ended September 30, 1994
------------------------------------------------
Exhibit Description
No. Of Exhibit Page
- ------- ----------- No.
----
1. Consent of Deloitte & Touche LLP,
Independent Auditors.......................10
Page 3
INDEPENDENT AUDITORS' REPORT
The Employee Benefit Plan Administrative Committee
The Cato Corporation
We have audited the accompanying statement of net assets of
The Cato Corporation Employee Stock Purchase Plan as of
September 30, 1995, and the related statement of changes in
net assets for the year then ended. These financial
statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on
these financial statements based on our audit. The
financial statements of The Cato Corporation Employee Stock
Purchase Plan for the eleven-month period ended September
30, 1994 were audited by other auditors whose report dated
December 14, 1994 expressed an unqualified opinion on those
statements.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan
and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the net assets of
The Cato Corporation Employee Stock Purchase Plan at
September 30, 1995 and the changes in net assets for the
years then ended in conformity with generally accepted
accounting principles.
DELOITTE & TOUCHE LLP
Charlotte, North Carolina
December 1, 1995
Page 4
REPORT TO INDEPENDENT AUDITORS
The Employee Benefit Plan Administrative Committee
The Cato Corporation
We have audited the accompanying statement of net assets of
The Cato Corporation Employee Stock Purchase Plan as of
September 30, 1994, and the related statement of changes in
net assets for the eleven-month period then ended. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan
and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the net assets of
The Cato Corporation Employee Stock Purchase Plan at
September 30, 1994, and the changes in net assets for the
eleven-month period then ended, in conformity with generally
accepted accounting principles.
Ernst & Young LLP
Charlotte, North Carolina
December 14, 1994
Page 5
THE CATO CORPORATION EMPLOYEE STOCK PURCHASE PLAN
STATEMENTS OF NET ASSETS
September 30, September 30,
1995 1994
------------- -------------
Receivable from Company $ 2,999 $ 627
------------- -------------
Liabilities of the Plan $ 2,999 $ 0
------------- -------------
Net Assets $ 0 $ 627
============= =============
See accompanying notes to financial statements.
Page 6
THE CATO CORPORATION EMPLOYEE STOCK PURCHASE PLAN
STATEMENTS OF CHANGES IN NET ASSETS
For the Year Ended September 30, 1995 and
the Eleven Month Period Ended September 30, 1994
September 30, September 30,
1995 1994
------------- -------------
Employee Contributions $ 425,869 $ 464,462
Deductions:
Purchases of The Cato
Corporation Common
Stock (68,473 shares
for the year ending
September 30, 1995 and
41,528 shares for the
eleven month period
ending September 30, 1994) 379,755 437,318
Withdrawals 46,741 26,517
------------- ------------
426,496 463,835
Net Increase (Decrease) (627) 627
Net Assets at Beginning of Year 627 0
------------- ------------
Net Assets at End of Year $ 0 $ 627
============= ============
See accompanying notes to financial statements.
Page 7
THE CATO CORPORATION EMPLOYEE STOCK PURCHASE PLAN
NOTES TO FINANCIAL STATEMENTS
Year Ended September 30, 1995 and 1994
NOTE 1 - BASIS OF PRESENTATION
- ------------------------------
The accompanying financial statements of The Cato
Corporation Employee Stock Purchase Plan ("the Plan") have
been prepared on the accrual basis. The Plan's fiscal year
ends on September 30. The period ended September 30, 1994
included eleven months which was from the Plan's effective
date.
NOTE 2 - PLAN DESCRIPTION AND SUMMARY OF SIGNIFICANT PLAN
- ---------------------------------------------------------
PROVISIONS
----------
The Board of Directors of The Cato Corporation adopted the
Plan on September 23, 1993 and the Plan was approved by
Shareholders of the Company at the Annual Meeting of
Shareholders on May 19, 1994. The Plan became effective as
of November 1, 1993 and will terminate on September 20,
2003, unless extended by the Board of Directors or
terminated sooner by the sale of all Shares offered under
the Plan. Of the 250,000 shares of the Cato Corporation
Common stock originally reserved under the Plan, 139,999
shares remained available at September 30, 1995 and 208,472
shares remained available at September 30, 1994.
The purpose of the Plan is to provide eligible employees
with an opportunity to participate in the accumulation and
potential appreciation in value of the Common Stock of The
Cato Corporation. Eligible employees are those who are
regularly scheduled to work at least 20 hours each week and
more than 5 months each calendar year and are actively
employed on the first and last day of the purchase period.
Under the terms of the Plan, all eligible employees of the
Company, through payroll deductions, are allowed to
purchase, at six-month intervals specified in the Plan,
shares of Common Stock at a 15% discount from the last
reported sale price of the Common Stock on the NASDAQ
National Market System. In addition to the Common Stock
which may be purchased through payroll deductions, Common
Stock discounted 15% may also be purchased by each plan
participant by a one-time election on April 15 of each year
in an amount not to exceed $10,000. The purchase price at
which shares will be sold during each offering period is 85%
of the lower of the fair market value at (1) the beginning
date of an offering period or (2) ending date of an offering
period. The purchase price for the one-time election is 85%
of the last sale price on or before the April 15 date as
listed on the NASDAQ National Market System.
Page 8
NOTE 2 - PLAN DESCRIPTION AND SUMMARY OF SIGNIFICANT PLAN
- ---------------------------------------------------------
PROVISIONS - CONTINUED
----------------------
Contributions are limited to 10 percent of compensation for
the biannual purchases made through payroll deductions. The
aggregate fair market value of Shares of Common Stock that
may be purchased by any participant during any calendar year
may not exceed $25,000. Pending investment, funds may be
held by The Cato Corporation. In addition to employee
contributions, all dividends paid on Common Shares purchased
through the plan shall be automatically reinvested in
additional shares.
A participant may withdraw all or any portion of the full
shares held in the participant's account under the Plan by
notifying The Cato Corporation in writing. A participant
may suspend payroll deductions at any time and applicable
payroll deductions will be returned to the participant.
The Plan is a stock plan as defined in Section 423 of the
Internal Revenue Code of 1986, as amended. Substantial tax
benefits are allowed to participants with respect to the
treatment of the stock purchased within the plan, provided
certain holding period requirements are met.
All costs to administer the Plan are paid by the Company.
Page 9
SIGNATURES
In accordance with the requirements of the Securities
Exchange Act of 1934, the Registrant has caused this report
to be signed on its behalf by the undersigned thereunto duly
authorized.
DATE: December 28, 1995
-----------------
The Cato Corporation
By: /s/ Robert Sandler
--------------------
Senior Vice President
Controller
Page 10
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration
Statement No. 33-69844 on Form S-8 of The Cato Corporation
Employee Stock Purchase Plan of our report dated December 1,
1995, appearing in this Annual Report on Form 11-K of The
Cato Corporation Employee Stock Purchase Plan for the year
ended September 30, 1995.
DELOITTE & TOUCHE LLP
Charlotte, North Carolina
December 28, 1995