What changed in this filing

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Item 1A. Risk Factors

2022-03-23 compared with 2021-03-29 · 785 added, 1290 removed, 147 unchanged (93% of the section changed)

2 unchanged sentences

should carefully consider

the following

risk factors,

other information

including the

disclosures under

“Forward-looking Information”

evaluating our

any potential

investment in

the following

uncertainties occur

business, financial condition and ope

rating results could be

materially and adversely affected,

your investment

common stock.

“Forward-looking

uncertainties

business, financial condition and

operating results could

be materially and

adversely affected, the

uncertainties

Additional risks

and uncertainties

Additional risks and

uncertainties not presently

currently deem immaterial

also materially and adversely affect our business operating results and financial condition.

Risks Relating to the COVID-19 Pandemic:

The outbreak and persistence of the COVID-19 pandemic

has and will adversely affect our business,

financial condition and results of operations.

has adversely

Company's business,

financial condition

not presently

currently deem

also materially

and adversely

our business,

operating results,

through fiscal

will continue

financial condition

common stock.

Risks Relating to the COVID-19 Pandemic:

The outbreak and persistence of the COVID-19 pandemic has and may continue

to adversely affect our

business, financial condition and results of operations.

operating results through fiscal 2021 and will likely

continue to do so in fiscal 2022 and

possibly beyond.

financial impacts associated

with the outbreak

include, but are

not limited to,

(i) lower net

sales in markets

affected by the

actual or potential

outbreak, whether due to

state and local

close stores,

Adverse financial impacts

associated with the

outbreak include, but

are not limited

lower net sales

in markets affected by actual or

potential adverse changes in conditions relating to the pandemic,

local orders,

reductions in

store traffic

labor shortages,

factors, (ii) lower net sales caused

by the delay of inventory production and fulfillment,

incremental costs

associated with

the outbreak,

including increased

freight and logistics costs and other expenses.

local governments

orders mandating

closures and other

measures to mitigate

the spread of

addition, public health

officials have

issued precautions and

guidance intended to

reduce the spread

of the virus,

including particular cautions

about congregating in

or heavily populated

areas, such as

malls and shopping

temporarily closed

It’s Fashion,

Beginning on May 1, 2020, we began to re-open stores based on the pertinent state and local orders.

June 15, 2020,

were re-opened,

but our stores

have been and continue

to operate at reduced

health guidance

public activity

and gatherings

the spread of the virus,

and may also continue

affect consumer

There continues to

be significant uncertainty

regarding the breadth

severity and duration

of business disruptions

COVID-19, as well as its impact on the global and U.S.

economy, consumer willingness to visit malls and

shopping centers,

appropriate associate

staffing levels

national, state

action, initiatives,

legislation, guidelines

economic effects

customers, suppliers

Company also remain fluid.

While the Company currently

anticipates that our

results for fiscal

2021 and possibly beyond

adversely impacted,

COVID-19 impacts the

labor shortages, or all of these factors, (ii) lower net sales caused by the delay of inventory production and

including increased freight and logistics costs and other expenses.

mitigation measures

that adversely

the Company’s

operations, store

its continuing

commercial behavior.

These uncertainties

emergence of additional variants, seasonal weather

changes or other factors that may

lead to a resurgence

and a reinstitution

of mandated restrictions, public

health advisories or decreased

of customers,

suppliers, associates

constituencies on

business depends

commercial activities.

Other uncertainties

businesses and

individuals may adapt

to COVID-19 as

to commercial activity.

The resurgence

virus and its

related effects

uncertainties

results and financial condition.

likely be adversely impacted,

whether and the extent

to which COVID-19 impacts the

Company’s results

course of future developments, which are highly uncertain,

including the relative speed and success of, as

public confidence

in, mitigation

measures such

current effort

portions of the

population, emerging information

regarding variants of

viruses and their

potential impact on

current mitigation efforts,

public attitudes toward

compliance with containment

and mitigation measures, and

possible new information and

understanding

that could alter the course and duration of current measures to combat the spread

developments,

possible new information, understanding or innovation

that could alter the course and

duration of current

measures to combat the spread of the virus.

It is also possible

the COVID-19 pandemic may

result in longer term

behavioral changes by

customers and

could adversely

business, including

shift to greater reliance

on online versus in-person shopping,

which could reduce traffic

to our stores and

strip shopping

disadvantage us relative to competitors

who are better established in

e-commerce sales, and reductions in

face-to-face work, travel and socializing occasions, which may lead customers to less

frequently desire or

COVID-19 and its continuing effects

may result in longer term

behavioral changes

by customers and others

that could adversely affect

our business, including but

not limited to a

shift to greater

reliance on online

versus in-person shopping, which

could reduce traffic

to our stores

disadvantage us relative to

competitors who are better

established in e-commerce sales,

and reductions in

face-to-face work, travel and socializing occasions, which may lead

customers to less frequently desire or

perceive the need to update their wardrobes.

The far-reaching impacts of the COVID-19 pandemic may also intensify other risks we discuss in

report and other filings we make from time to time with the SEC.

Future outbreaks of

similar public

health threats,

occurrence, may

intensify other

other filings we make from time to time with the SEC.

also have a material adverse effect on the Company’s business, financial condition and operating results.

Risks Relating to Our Business:

Unusual weather, natural disasters,

public health threats or similar events may adversely affect

Extreme changes

natural disasters,

public health

similar events

can influence

customer trends and

shopping habits.

For example, heavy

rainfall or other

extreme weather conditions

including but

period, might

difficult for

Increased product costs, freight costs, wage increases and operating costs due to

inflation and other factors,

as well as limitations in our ability to offset these cost increases by increasing

prices of our

products or otherwise,

may adversely affect our business, margins, results of operations and

raw materials

products, coupled

ocean freight

resulting from

disruption, is

continuing to

distribution center

and home office

more difficult

new associates

retain existing associates.

The tight labor market

and inflation also are

driving up our operating

we are unable to offset the effects of these increased costs to our business by increasing the retail prices of

financial condition may be adversely affected.

Our ability to

prices in response

cost increases may

unwillingness

discretionary

conditions could also

lead our customers

to reduce their

amount of current

discretionary spending on our

products even in the

absence of price increases,

which could erode our

sales volume and adversely

our results of operations and financial condition.

Unusual weather, natural disasters, public

health threats or similar events may adversely affect

customer trends

heavy rainfall

extreme weather

profitability.

susceptible to

unseasonable weather conditions.

For example, extended

unseasonable weather

unseasonably warm

temperatures during the

winter season or

cool weather during

the summer season

could render a

inventory incompatible

unseasonable conditions.

Reduced sales

prolonged unseasonable

weather conditions

would adversely

The occurrence

extreme weather,

natural disasters,

power outages,

terrorist acts,

communicable diseases

COVID-19 pandemic)

catastrophic events

reduce customer traffic

in our stores

and likewise disrupt

our ability to

conduct operations, which

materially and adversely affect us.

Because we source a significant portion of our merchandise directly

and indirectly from overseas, we are

subject to risks associated with international operations and

risks that affect the prevailing social, economic,

political, public health and other conditions in the areas from

which we source merchandise;

disruptions, cost changes or other problems affecting

the Company’s merchandise

supply chain could

temperatures during

summer season

communicable diseases (such as COVID-19) or other catastrophic events could reduce customer

Because we source a significant portion of our merchandise directly and indirectly from

overseas, we are

subject to risks associated with international operations and risks that affect

the prevailing social, economic,

political, public health and other conditions in the areas from which we source merchandise;

disruptions, increased costs

or other problems affecting the Company’s

merchandise supply chain could

materially and adversely affect the Company’s

business, results of operations and financial condition.

A significant amount of our

merchandise is manufactured overseas, principally in Southeast

directly import some of this merchandise and indirectly import

the remaining merchandise from domestic

vendors who acquire

the merchandise from

foreign sources.

our third-party vendors

materials primarily

result, political

unrest, labor

terrorism, public health

threats, including but

to communicable diseases

COVID-19 pandemic), financial or other forms of

instability or other events resulting in

the disruption of

countries affecting

chain, increased

security requirements

merchandise, or

the imposition of,

or changes in,

laws, regulations or

changes in duties,

quotas, tariffs,

taxes or governmental policies regarding these matters or other

factors affecting the availability or cost of

imports, could cause

significant delays or

interruptions in the

supply of our

merchandise or increase

disruptions affecting

A significant amount of

our merchandise is manufactured

overseas, principally in Southeast

directly import some of this merchandise and

indirectly import the remaining merchandise from domestic

COVID-19), financial or other forms of instability or other events resulting in the disruption of trade from

imposition of, or changes

in, laws, regulations or

changes in duties, quotas, tariffs,

taxes or governmental

policies regarding

these matters

factors affecting

the availability

interruptions

shipping capacity versus

the current demand

for container shipping

ability to access

including increased

container ships,

conditions impacting

ocean freight.

including lack

container ship

capacity, lack

containers, port

congestion and

other conditions

impacting ocean

including lack

domestic intermodal

transportation (trucks

and drivers),

domestic port

congestion and

other conditions

impact domestic

supply chain.

transport our merchandise and delayed merchandise arrivals to our stores, which may adversely affect our

merchandise and

increase markdowns

fluctuations, and changes in the

value of the dollar relative

to foreign currencies may increase our

these factors

adverse effect

In addition, increased energy and transportation

costs have caused us significant

increases from time

future adverse changes in

these costs or

the disruption of

which merchandise

is transported

additional cost

interruptions of

supply chain which could be significant.

Further, we are subject to increased costs or potential disruptions

impacting any port

transportation

incoming container ships, lack of container yard capacity and lack of available drayage from the ports and

other conditions that may impact

our domestic supply chain.

These supply chain risks may

result in both

affected by currency fluctuations, and changes in the value of the dollar relative to foreign currencies may

increase our cost of goods

Any of these factors

could have a material adverse effect

on our business

transportation

significant cost increases from time to time,

and future adverse changes in these

costs or the disruption of

the means by which merchandise is transported to us could cause additional cost increases

or interruptions

disruptions impacting any

port or trade

route through which

route freight

through different

through which

products typically move.

forced to source

merchandise from other

countries or other

vendors with foreign sources

in different countries, those

goods may be more

expensive or of a

or inferior quality from the ones we now sell.

The inability of third-party vendors to produce goods on

time and to the Company’s

our products move,

increased costs

freight through

different ports

domestic vendors with foreign

sources in different

countries, those goods

may be more expensive

different or inferior quality from the ones we now sell.

The inability of third-party vendors to produce goods on time and to the Company’s

specification may

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business, results of operations and financial condition.

Our dependence

party vendors

to manufacture

our merchandise

numerous risks that our

vendors will fail to

perform as we expect.

For example, the deterioration

vendors’ financial condition,

their failure to

ship merchandise in

a timely manner

our specifications, or

other failures to

follow our vendor

guidelines or comply

with applicable laws

regulations, including

compliant labor,

environmental practices

safety, could

numerous risks that

our vendors will

fail to perform

as we expect.

For example, the

deterioration in any

vendors’ financial

condition, their

ship merchandise

timely manner

our specifications,

vendor guidelines

with applicable

environmental

operational, quality,

competitive, reputational and

timely or adequately

replace the merchandise we currently source

with merchandise produced elsewhere, or if our

to perform as

our business,

operations and financial

condition could

Activities conducted

United States

further subject

numerous U.S.

and international regulations and compliance risks, as discussed

below under “Risk

Factors – Risks

Relating to Accounting

and Legal Matters

- Our business

operations subject us

compliance and litigation risks,

as well as regulations

and regulatory enforcement priorities,

result in increased costs or liabilities, divert our

management’s attention or otherwise adversely affect

replace the merchandise we currently

source with merchandise produced elsewhere,

or if our vendors fail

business, results

international

Risks Relating

to Accounting

operations subject

compliance and litigation

risks, as well

as regulations and

regulatory enforcement priorities, which

result in increased costs or liabilities,

divert our management’s attention

or otherwise adversely affect our

business, results of operations and financial condition.”

Our ability to attract consumers and grow our revenues is dependent

on the success of our store location

Our ability to attract consumers and grow our revenues is dependent on the success of our store location

strategy and our ability to successfully open new stores as planned.

Our sales are dependent

the location of our

stores in shopping centers

and malls where we

believe our consumers

and potential consumers

In addition, our

ability to grow

our revenues has

Our sales are

dependent in part

on the location

of our stores

in shopping centers

and malls where

consumers and

potential consumers

been substantially dependent on our ability to secure space for and open new stores in attractive locations.

Shopping centers and malls where we currently operate existing stores

or seek to open new stores may be

Shopping centers and malls where we currently

operate existing stores or seek to open

new stores may be

adversely affected by, among other

things, general economic downturns or those particularly affecting the

commercial real

estate industry,

stores, changes

customer shopping preferences, including but not limited to an increase in preference for online versus in-

person shopping.

advantage of consumer traffic

and the shopping preferences of

take advantage of

consumer traffic and

the shopping preferences of

our consumers,

we need to maintain and acquire stores in desirable locations where competition

for suitable store

decline in customer

popularity of the

strip shopping centers

where we generally

locate our stores or in

availability of space in desirable centers

and locations, or an increase in

stores, adversely

affect consumer

popularity of

locate our stores or

in availability of space

in desirable centers and locations,

or an increase in

reduce our sales and net earnings or increase our operating costs.

Our ability to

open and operate

new stores depends

on many factors,

some of which

are beyond our

These factors

suitable store

negotiate acceptable lease terms, secure necessary governmental

permits and approvals and hire and

many factors,

negotiate acceptable lease terms, secure

necessary governmental permits and approvals and

hire and train

appropriate store personnel.

In addition, our continued

expansion into new regions

of the country where

business before

new challenges

in competition, distribution

In addition, our

continued expansion into

new regions of

merchandising as we enter these new markets.

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execute our plans for

opening new stores or

the failure of these

stores to perform up

to our expectations could

adversely affect

opening new stores

or the failure

of these stores

to perform up

to our expectations

could adversely affect

our business, results of operations and financial condition.

If we are unable to anticipate, identify and respond to

rapidly changing fashion trends and customer

demands in a timely manner,

our business and results of operations could materially

Customer tastes

trends, particularly

volatile, tend

rapidly and cannot be predicted

with certainty.

Our success depends in part

upon our ability to

If we are unable to anticipate, identify and respond to rapidly changing fashion trends and

demands in a timely manner, our business

and results of operations could materially suffer.

consistently anticipate, design and respond to changing merchandise trends and consumer preferences in a

timely manner.

Accordingly, any

anticipate, identify,

fashion trends

could adversely

onsumer acceptance

merchandise, which

adversely affect our business, results of

operations and our image with our customers.

adversely affect our business, results

of operations and our image with

our customers.

If we miscalculate

either the market

for our merchandise

or our customers’ tastes

or purchasing habits, we

our merchandise

customers’ tastes or

purchasing habits, we

may be required

to sell a significant amount of unsold inventory at below-average markups over cost, or below cost, which

3 unchanged sentences

gross margin and our overall results of operations.

Comparable sales

affecting comparable

sales include

fashion trends,

customer preferences,

holiday shifts,

competition, weather,

potential public

health threats

addition, merchandise

ordered well in

advance of the

applicable selling season

and before trends

are confirmed by

able to accurately

predict customers’ preferences

fashion items, we

inventory, which may

cause excessive markdowns.

are unable to accurately predict

demand for our

confirmed by sales.

accurately predict customers’

preferences for our

fashion items,

we may have too

much inventory, which

may cause excessive markdowns.

are unable to accurately

predict demand

merchandise, we may

inventory shortages,

resulting in missed

with inventory shortages,

missed sales.

A decrease in

comparable sales or

our inability to

effectively manage inventory

may adversely affect

our gross margin

and results of operations.

effectively manage inventory may

adversely affect our

gross margin and results of operations.

Existing and increased competition in the women’s

retail apparel industry may negatively impact our

business, results of operations, financial condition and market

retail apparel

highly competitive.

primarily with

merchandisers, department

-price retailers,

specialty stores

and internet-

retailers, many of which have substantially greater financial, marketing and other resources than

our competitors offer

frequent promotions and

business, results of operations, financial condition and market share.

merchandisers,

internet-based

retailers, many of which have substantially greater financial, marketing and

other resources than we have.

competitors offer

promotions and

selling prices.

In some cases,

competitors are expanding into markets

in which we have a

significant market presence.

competitors are expanding into

markets in which we

have a significant market

In addition, our

competitors also compete

same retail store space.

As a result of this

competition, we may

experience pricing

pressures, increased

marketing expenditures,

increased costs

well as loss of market share, which could materially and adversely affect

our business, results of

expenditures,

operations and financial condition.

The operation of our sourcing offices in Asia may

present increased legal and operational risks.

established our

experience with

regulatory practices and requirements in Asia is

If our sourcing offices are

unable to successfully

oversee merchandise

production to

The operation of our sourcing offices in Asia may present increased legal

and operational risks.

regulatory practices and requirements in Asia

If our sourcing offices

are unable to successfully

specifications, our business, brand, reputation, costs, results of operations

financial condition could be

materially and

adversely affected.

activities conducted

sourcing offices

United States

operational risks,

and international

regulations and

compliance risks, as

discussed elsewhere in

this “Risk Factors”

section, in particular

below under “Risk

Factors – Risks

Relating to Accounting

and Legal Matters

- Our business

operations subject us

compliance and litigation risks,

as well as regulations

and regulatory enforcement priorities,

result in increased costs or liabilities, divert our

management’s attention or otherwise adversely affect

and financial condition could be

international

compliance risks,

Factors” section,

in particular

Risks Relating

to Accounting

operations subject

compliance and litigation

risks, as well

as regulations and

regulatory enforcement priorities, which

result in increased costs or liabilities,

divert our management’s attention

or otherwise adversely affect our

business, results of operations and financial condition.”

Any actual or perceived deterioration in the conditions that drive

consumer confidence and spending may

materially and adversely affect consumer demand

for our apparel and accessories and our results of

Any actual or perceived deterioration in the conditions that drive consumer confidence

and spending may

materially and adversely affect consumer demand for our apparel

and accessories and our results of

Consumer spending habits, including spending for our apparel and accessories, are affected by, among

other things, prevailing social, economic, political and

public health conditions and uncertainties (such as

other things, prevailing social, economic,

political and public health

conditions and uncertainties (such as

matters under debate in the U.S.

from time to time regarding budgetary,

spending and tax policies and the

impact of the

global COVID-19 pandemic),

levels of employment,

fuel, energy and

food costs, salaries

and wage rates

and other sources of

income, tax rates, home

values, consumer net worth,

the availability

credit, consumer

confidence and

consumer perceptions

affecting any of

from time to time

regarding budgetary, spending and tax policies and

COVID-19), levels

employment, fuel,

other sources of

income, tax rates,

home values, consumer net

worth, the availability

of consumer credit,

inflation, consumer confidence and consumer perceptions of adverse changes in or trends affecting any of

significantly

perceptions of

these conditions

Any perception that these

conditions may be worsening

or continuing

to trend negatively may significantly weaken many of these drivers of consumer spending habits.

perceptions of these

conditions or uncertainties

regarding them also

generally cause consumers

discretionary items,

our merchandise,

purchase cheaper

alternatives to

merchandise, all of

which may also

adversely affect our

net sales and

results of operations.

numerous events, whether

related to actual

economic conditions, such

as downturns in

markets, acts

or terrorism,

political unrest

disasters, outbreaks

consumer confidence,

and accordingly,

reduced consumer

adverse effect

business, results

of operations

uncertainties regarding

generally cause

discretionary

merchandise, all

adversely affect

numerous events,

economic conditions,

financial condition.

Fluctuations in the price, availability and quality of

inventory may result in higher cost of goods, which the

Fluctuations in the price, availability and quality of inventory may result in higher

cost of goods, which the

Company may not be able to pass on to its customers.

are increasingly passing on higher

production costs, which may impact

our ability to

maintain or grow

price and availability

of raw materials

may be impacted

regulation, weather and

crop yields, currency

value fluctuations, as

well as other

which may impact our ability to maintain or grow our margins.

The price and availability of raw materials

demand, regulation,

currency value

fluctuations, inflation,

other factors.

Additionally,

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manufacturing costs,

transportation, labor and

benefit costs.

increases in production

costs result in

higher merchandise

the Company’s

limited flexibility in price

point, the Company may

transportation, labor

production costs

point, the Company

on those cost

increases to the

consumer, which

material adverse effect

results of operations and financial condition.

If the Company is unable to successfully integrate new businesses into

its existing business, the Company’s

financial condition and results of operations will be adversely

consumer, which could

material adverse effect on our margins, results of operations and financial condition.

If the Company is unable to successfully integrate new businesses into its existing business,

the Company’s

long-term business strategy

includes opportunistic growth

through the development

This growth may

require significant capital expenditures

and management

financial condition and results of operations will be adversely affected.

The Company’s

long-term business

strategy includes

opportunistic growth

The Company may not

realize any of the anticipated

benefits of a new business

and integration

exceed anticipated

have incurred

substantial financial

commitments and

costs related to our retail stores that we will not be

able to recover if our stores are not successful and that

could potentially result

in impairment charges.

successfully execute our

growth strategies,

our financial condition and results of operations may be adversely impacted.

Failure to attract, train, and retain skilled personnel could adversely

affect our business and our financial

Like most retailers, we

experience significant associate turnover

rates, particularly among store

associates and managers.

Because our continued store growth

will require the hiring and

training of new

associates, we must

continually attract, hire

and train new

store associates to

meet our staffing

significant increase in the turnover rate among our store sales associates and managers would increase our

recruiting and

training costs, as

possibly cause a

operating efficiency

productivity.

for qualified store

experienced management personnel,

with other companies in

our industry or other

industries, many of whom

have greater financial resources

management personnel

the operational

existing business

executing our

business strategy depends

in large part

on retaining key

compete for key

personnel with

other retailers, and

our inability to

retain qualified personnel

realize any of the

anticipated benefits of a

new business and integration

costs related to our retail stores that we

will not be able to recover if our stores

are not successful and that

potentially result

impairment charges.

successfully execute

our financial condition and results of operations may be adversely

Failure to attract, train, and retain skilled personnel could adversely affect

our business and our financial

retailers, we

experience significant

associate turnover rates,

particularly among store

associates and

attracting and

retaining skilled

personnel has

become increasingly

challenging in

persisted since

COVID-19 pandemic.

store growth,

continually attract,

sales associates and managers would increase our recruiting and training costs, as well as possibly cause a

decrease in our store operating

efficiency and productivity.

compete for qualified store associates, as

many of whom have greater financial resources than we do.

business strategy

key management.

key management

retailers, and

qualified personnel

ability to continue to grow.

our key management

associates or

attract, train,

skilled personnel

able to service

our customers effectively

business strategy, which could adversely affect our business, operating results and financial condition.

The currently

competitive environment

associates and

retaining existing

associates is

financial condition if we cannot offset these cost increases.

Risks Relating to Our Information Technology and Related Systems:

A failure or disruption relating to our information technology

systems could adversely affect our business.

on our existing information technology systems for merchandise operations,

merchandise planning, replenishment, pricing,

ordering, markdowns and

product life cycle

In addition to merchandise operations,

we utilize our information technology systems

for our distribution

processes, as well

as our financial

systems, including accounts

payable, general ledger,

receivable, sales, banking,

inventory and fixed

Despite the precautions

systems are or may be vulnerable to disruption or failure

from numerous events, including but not limited

A failure or disruption relating to our information technology systems could

adversely affect our business.

merchandise planning,

replenishment, pricing, ordering,

markdowns and

cycle management.

In addition to

merchandise operations, we utilize

our information technology systems for

our distribution

receivable, sales,

banking, inventory

precautions we

systems are or may be vulnerable to disruption

or failure from numerous events, including but not limited

to, natural disasters, severe weather conditions, power outages, technical malfunctions, cyber-attacks, acts

or terrorism,

similar catastrophic

Any disruption or failure in the operation of our information technology systems, our failure to

associated with

maintaining, repairing

improving these systems,

could adversely affect

our business, results

of operations and

Modifications and/or upgrades to our current

information technology systems may also disrupt

Modifications and/or upgrades to

our current information technology systems may also

our operations.

A disruption or shutdown of our centralized distribution center or

transportation network could materially

and adversely affect our business and results of

The distribution of

our products is

centralized in one

distribution center in

Charlotte, North Carolina

and distributed

A disruption or shutdown of our centralized distribution center or transportation network

could materially

and adversely affect our business and results of operations.

The distribution

centralized in

one distribution

Charlotte, North

shipped directly to

our distribution center,

prepared for shipment

to the appropriate

subsequently delivered

third-party freight

The merchandise

shipped directly to our

distribution center, where it

is prepared for shipment to

the appropriate stores and

subsequently delivered to

third-party freight carriers.

If the distribution

third-party freight carriers were to be

shut down or lose significant capacity

third-party freight carriers were

to be shut down

or lose significant capacity

for any reason, including but

not limited to, any of the causes described above under “A failure or disruption relating

to our information

technology systems could adversely affect

our business,” our operations would likely

not limited to, any of the causes described above under “A failure or disruption

relating to our information

Such problems could occur as the result of any loss, destruction or impairment of our ability to

distribution center,

as any broader

problem generally affecting

the ability to

into our distribution center or deliver goods to

problem generally

into our distribution center or deliver goods

to our stores.

As a result, we could incur significantly higher

costs and longer lead times associated

with distributing our products to our

stores during the time it

for us to reopen or replace the

distribution center and/or our transportation network.

Any such occurrence

costs and longer lead

times associated with distributing our

products to our stores during

the time it takes

for us to reopen or

replace the distribution center and/or our transportation network.

could adversely affect our business, results of operations and financial condition.

A security breach that results in unauthorized access to or disclosure

of employee, Company or customer

information could adversely affect our costs, reputation

and results of operations, and efforts to mitigate

A security breach that results in unauthorized access to or disclosure of employee,

Company or customer

information could adversely affect our costs, reputation and

results of operations, and efforts to mitigate

these risks may continue to increase our costs.

The protection

customer data

breach, mishandling, human or programming error or other event that results in the misappropriation, loss

unauthorized disclosure

customer information,

including but

limited to credit card data or

other personally identifiable information, could severely damage the

Company's reputation, expose it to remediation

and other costs and the

of legal proceedings, disrupt

its operations and otherwise adversely affect

the Company's business and financial

security of certain of this

information also depends on the

ability of third-party service providers,

process credit

card payments

payment-related risks,”

information systems

those of our third-party service

providers are subject to ongoing

and persistent cybersecurity threats from

those seeking unauthorized access

through means which are

continually evolving and may be

Company's reputation, expose it to

remediation and other costs

and the risks of legal

proceedings, disrupt

security of certain of

this information also depends on

the ability of third-party

service providers, such as

payment-related

third-party service providers are

subject to ongoing and

persistent cybersecurity threats from

those seeking unauthorized

access through means

continually evolving and

may be difficult

anticipate or detect for long periods

Despite measures the Company takes to

protect confidential

information against unauthorized

access or disclosure,

which are ongoing

and may continue

our costs, there

is no assurance

that such measures

will prevent the

compromise of such

any such compromise

or unauthorized access

to or disclosure

of this information

were to occur,

have a material

adverse effect on

the Company's reputation,

business, operating results,

Despite measures the Company takes

to protect confidential

information against

unauthorized access

disclosure, which

measures will

compromise of

such information.

compromise or

unauthorized access

disclosure of

this information

condition and cash flows.

1 unchanged sentence

-related risks.

payments using a

variety of methods,

including third-party credit

cards, our own

credit cards,

and electronic

payment methods

customers, we

additional regulations

compliance requirements

(including obligations

enhanced authentication

processes that

could result in

increased costs and

reduce the ease

certain payment methods),

For certain payment methods,

including credit and debi

cards, we pay interchange and

other fees, which

accept payments

methods, including

third-party credit

authentication

certain payment

methods, including

pay interchange

time, raising

operating costs

profitability.

service providers for

payment processing services,

including the processing

of credit and

each case, it could

disrupt our business if

these third-party service providers

become unwilling or unable

to provide these services to us.

are also subject to payment card association operating rules, including

data security rules, certification

requirements and rules governing electronic

funds transfers, which could

reinterpreted to make

it difficult or

impossible for us

to comply with

or requirements,

security systems

liable for card-issuing banks’

costs, subject to fines

and higher transaction fees.

In addition, we may

lowering profitability.

these third-party

service providers

become unwilling

or unable to provide these services to

are also subject to payment card association operating rules,

certification

be reinterpreted

or impossible

comply with these rules or requirements, or if our data security systems are breached or compromised, we

card-issuing banks’

costs, subject

transaction fees.

payments from

our customers

electronic funds

transfers or facilitate

other types of

payments, and our

business and operating

results could be

adversely affected.

The Company’s

failure to successfully operate its e-commerce websites or fulfill customer

expectations could

adversely impact customer satisfaction, our reputation and

our business.

Company's e-commerce platform

provides another

drive incremental

provide existing customers the on-

line shopping experience and

introduce the Company to a

customer base, it

also exposes us

to numerous risks.

subject to potential

failures in the

and uninterrupted operation of

our websites, customer contact

center or our distribution

failure to successfully operate its e-commerce websites or fulfill customer expectations

adversely impact customer satisfaction, our reputation and our business.

Company's e-commerce

customer base,

the efficient

and uninterrupted operation

websites, customer contact center

or our distribution

center, including

system failures

telecommunication system

providers, order

system capabilities, electrical outages, mechanical problems

and human error.

telecommunication

system capabilities, electrical outages,

mechanical problems and human error.

Our e-commerce platform

may also expose us to

greater potential for security or

data breaches involving the unauthorized access

or disclosure of customer information, as discussed

above under “A

security breach that

unauthorized disclosure of employee, Company or customer information could

adversely affect our costs,

may also expose us

to greater potential for

security or data

breaches involving the unauthorized access

reputation and

1 unchanged sentence

mitigate these

are also subject to risk related

to delays or failures in the

performance of third parties, such as

shipping companies,

including delays

associated with

labor strikes

Company does not successfully

meet the challenges of

operating e-commerce websites

or fulfilling customer expectations, the Company's business and sales could be

performance of

expectations,

adversely affected.

Risks Relating to Accounting and Legal Matters:

Changes to accounting rules and regulations may

adversely affect our reported results of operations

Changes to accounting rules and regulations may adversely affect

our reported results of operations and

financial condition.

provide greater

comparability of

financial reporting

increasing global

environment, accounting regulatory authorities have

been in discussions for many

years regarding efforts

comparability

environment, accounting regulatory authorities

discussions for many years

regarding efforts

to either converge U.S.

Accepted Accounting Principles with International Financial Reporting

Standards (“IFRS”), have

companies provide

supplemental IFRS-based information

or continue to

globally accepted

accounting standards.

If implemented,

these potential

changes in accounting rules or regulations could

significantly impact our future reported

operations and financial position.

Changes in accounting rules

or regulations and varying interpretations

of existing accounting

rules and regulations

have significantly affected

our reported financial

and those of other participants in the retail industry in the past and may

continue to do so in the future.

lease accounting

standards effective

Company beginning

2019 required

to capitalize

operating leases

financial statements.

These changes

a significant

lease-related assets

and liabilities

balance sheet,

resulting in an

increase of 40%

our total assets

and total liabilities

on our balance

other changes

recording and

classification of

lease-related expenses

statements of income and cash flows.

These changes

could lead to the perception by investors

highly leveraged

calculation of

numerous financial

performance and

financial condition.

future changes

to accounting

regulations may

adversely affect

operations and

financial position

or perceptions

performance and financial condition.

Adverse litigation matters may adversely affect

our business and our financial condition.

in litigation

claims against

our business.

Generally Accepted Accounting Principles with International Financial

Standards (“IFRS”),

provide supplemental

IFRS-based information

significantly

operations and financial

Changes in accounting

regulations and varying interpretations

accounting rules

and regulations

have significantly

reported financial

participants in

Future changes to

accounting rules or

regulations may adversely

reported results of

and financial position or perceptions of our performance and financial

Adverse litigation matters may adversely affect our business and

our financial condition.

Primarily these

arise from our

normal course of

and uncertainties,

could require

significant management time.

The Company’s periodic evaluation of litigation-

matters may change our assessment in light of

the discovery of facts with respect to legal

actions pending

not presently known

or by determination

of judges, juries

or other finders

subjected to legal matters

not yet known to

Adverse decisions or

settlements of disputes

uncertainties, and

litigation-related

matters may change our assessment in light

of the discovery of facts with respect to

legal actions pending

presently known

by determination

judges, juries

other finders

decisions or settlements

may negatively impact our business, reputation and financial condition.

Our business operations subject us to legal compliance

and litigation risks, as well as regulations and

regulatory enforcement priorities, which could result in increased

costs or liabilities, divert our

attention or otherwise adversely affect our business, results

of operations and financial

Our operations are

subject to federal,

state and local

laws, rules and

regulations, as well

and regulations

our activities

countries from

merchandise and operate

our sourcing offices.

subject to regulatory

and litigation

of these jurisdictions, including

foreign jurisdictions that

may lack well-established or

legal systems

for resolving

legal disputes.

Compliance risks

and litigation

issues, intellectual

property issues,

employment issues,

commercial disputes,

product-oriented matters, tax,

Our business operations subject us to legal compliance and litigation risks, as well as regulations

regulatory enforcement priorities, which could result in increased costs or liabilities,

attention or otherwise adversely affect our business, results of operations

and financial

Our operations

regulations, as

regulatory and

these jurisdictions, including

foreign jurisdictions

lack well-established

product-oriented

relations and personal injury claims.

International activities

subject us to numerous U.S.

International

activities subject us to numerous U.S.

and international

regulations, including but not limited to, restrictions on trade, license and permit requirements, import and

export license

requirements, privacy

protection laws,

environmental laws,

information management

regulations, tariffs

corruption laws,

Corrupt Practices Act, violations of

which by employees or persons acting

on the Company’s behalf

result in significant

investigation costs, severe

criminal or civil

sanctions and reputational

liabilities to

could negatively affect

our business,

operating results

requirements,

environmental

anti-corruption

Corrupt Practices Act, violations

of which by employees

or persons acting on

the Company’s

significant investigation

costs, severe

civil sanctions

and reputational

business, operating

and financial condition.

These matters frequently raise complex factual and legal issues, which are subject

and uncertainties

divert significant

management time.

subject to regulatory review

and audits, which results

potential to materially and

business, results of

operations and financial

governing laws, rules

regulations, and interpretations of existing laws are subject to change

from time to time.

uncertainties

regulatory review and

audits, which results

potential to materially

and adversely

business, results

operations and

financial condition.

governing laws,

regulations, and interpretations of existing laws are subject to

change from time to time.

Compliance and

litigation matters could

result in unexpected

expenses and liability,

have an adverse

litigation matters

in unexpected

our operations and our reputation.

New legislation or regulation and interpretation of existing laws and regulations related to data privacy

could increase our costs of compliance, technology and business operations.

The interpretation of existing

or new laws to

existing technology and practices can be

uncertain and may lead to

additional compliance

risk and cost.

If we fail to protect

our trademarks and other

intellectual property rights or infringe

the intellectual property

business, brand

image, growth

strategy, results

of operations

and financial

interpretation

data privacy,

could increase

of compliance,

technology and

business operations.

interpretation of existing or

existing technology and practices

can be uncertain and

to additional compliance risk and cost.

If we fail to

protect our trademarks and

other intellectual property

rights or infringe the

intellectual property

could be adversely affected.

“Cato”, “It’s

Fashion”, “It’s

Fashion Metro”

and “Versona”

trademarks are

designs, brand

recognition and

to successfully

build consumer

Although we have

registered these trademarks

with the U.S.

Patent and Trademark

Office (“PTO”)

have also registered, or applied for registration

of, additional trademarks with the PTO that we believe are

important to our

business, we cannot

give assurance that these

registrations will prevent

imitation of our

trademarks, merchandising concepts, store designs or private label merchandise or the infringement

other intellectual property rights by

Infringement of our names,

concepts, store designs or

merchandise generally,

or particularly

projects lesser

connotation of our

image could adversely

business, financial condition

and results of

In addition, we

cannot give assurance that

others will not

the manufacture or

private label merchandise by

claiming that our merchandise violates

their trademarks or other proprietary

resolution of which

we cannot predict;

however, such a

controversy could adversely affect

have registered

these trademarks

and Trademark

have also registered, or applied for registration of, additional trademarks with the PTO that we believe are

our business,

give assurance that

these registrations will

prevent imitation

trademarks, merchandising concepts, store designs or private label merchandise or

the infringement of our

give assurance

that others will

the manufacture

private label merchandise by claiming

that our merchandise violates

their trademarks or other

resolution of

cannot predict;

controversy could

adversely affect

our business,

financial condition and results of operations.

Maintaining and improving our internal control over financial

reporting and other requirements necessary

to operate as a public company may strain our resources, and

any material failure in these controls may

negatively impact our business, the price of our common

stock and market confidence in our reported

Maintaining and improving our internal control over financial reporting and

other requirements necessary

to operate as a public company may strain our resources, and any material failure

in these controls may

negatively impact our business, the price of our common stock and market

confidence in our reported

financial information.

are subject to

the reporting requirements

of the Securities

Exchange Act of

1934, the Sarbanes

-Oxley Act of

2002, the rules

Stock Exchange and

public company,

the reporting

requirements of

the Securities

Sarbanes-Oxley Act

Stock Exchange

aspects of the Dodd-Frank Wall

Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and

related rule-making that has

been and may continue

to be implemented over

the next several years

related rule-making that

may continue to

be implemented over

the next several

the mandates of the Dodd-Frank Act.

The requirements of

these rules and regulations have increased, and

may continue to increase,

our compliance costs and place significant strain on our pe

rsonnel, systems and

implementing the

requirements of

2002, we must

continue to document,

test, monitor and

enhance our internal

financial reporting, which is a

costly and time-consuming effort that

must be re-evaluated frequently.

cannot give assurance

that our disclosure

controls and procedures

and our internal

control over financial

reporting, as defined by

applicable SEC rules, will

be adequate in the

to maintain the

effectiveness of

requirements of these rules and regulations have increased, and

may continue to increase, our compliance costs and

place significant strain on our personnel, systems and

must continue

document, test,

internal control

over financial

other various

regulations to which

will continue to

be subject, or

may become subject

future, as a public company

could have an adverse material impact

on our business, our financial

condition and the

financial reporting, which is

a costly and time-consuming effort

that must be re-evaluated

assurance that

our disclosure

procedures and

reporting, as

defined by applicable

will be adequate

in the future.

to maintain the

effectiveness

regulations to

will continue

condition and

common stock.

addition, our efforts

to comply with

these existing and

new requirements could significantly increase our compliance costs.

Risks Relating to Our Investments and Liquidity:

We may experience

market conditions or other events that could adversely

impact the valuation and liquidity

of, and our ability to access, our short-term investments, cash and

cash equivalents and our revolving line of

-term investments

equivalents are

primarily comprised of

investments in

state, municipal and

corporate debt securities.

those securities may

be adversely impacted

by factors relating to these securities, similar

securities or the broader credit markets in general.

these factors are beyond

our control, and include

limited to changes

to credit ratings, rates

default, collateral value,

discount rates, and

strength and quality

of market credit

We may experience market

conditions or other events that could adversely impact the valuation and liquidity

of, and our ability to access, our short-term investments, cash and cash equivalents and

our revolving line of

short-term investments

state, municipal

and corporate

debt securities.

securities may

by factors relating to these securities,

similar securities or the broader credit

markets in general.

these factors

are beyond our

control, and include

not limited to

credit ratings, rates

default, collateral

value, discount

market credit

and liquidity,

disruptions in the capital markets

and changes in the underlying economic,

financial and other conditions

that drive these factors.

As federal, state and

municipal entities struggle with declining

disruptions in the capital

markets and changes in the

underlying economic, financial and other

that drive these

As federal, state

and municipal entities

struggle with declining

tax revenues and

budget deficits, we

cannot be assured

of our ability

to timely access

these investments if

the market for

budget deficits,

timely access

these investments

these issues declines.

Similarly, the

default by issuers of

the debt securities we

hold or similar securities

could impair the liquidity of

our investments.

The development or persistence of

any of these conditions

could adversely

financial condition,

operations and

have significant amounts

the default by

issuers of the

debt securities we

hold or similar

could impair the liquidity

of our investments.

The development or persistence

of any of these

have significant

equivalents at

financial institutions

federally insured

development of

conditions affecting the financial sector and stability

of financial institutions could cause us to

conditions affecting the financial sector

and stability of financial institutions could cause

us to experience

losses on our deposits.

Our ability to

access credit markets

and our revolving

line of credit,

either generally or

market terms, may be impacted

by the factors discussed in

credit markets

revolving line

either generally

market terms, may be

impacted by the

factors discussed in

the preceding paragraph, as

well as continued

compliance with covenants under our

revolving credit agreement.

The development or persistence of

of these adverse

factors or failure to

comply with covenants on

which our borrowing is

conditioned may

adversely affect

our financial

condition, results

compliance with covenants under

our revolving credit agreement.

development or persistence of

adverse factors or

comply with covenants

borrowing is conditioned

Risks Relating to the Market Value of Our Common Stock:

Our operating results are subject to seasonal and quarterly

fluctuations, which could adversely affect the

Our operating results are subject to seasonal and quarterly fluctuations, which could

adversely affect the

market price of our common stock.

Our business varies

with general seasonal

trends that are

characteristic of the

retail apparel industry.

our stores typically

generate a higher

percentage of our

annual net sales

and profitability in

and second quarters

compared to other

Accordingly, our

results for any

one fiscal period

are not necessarily

indicative of

results to be

expected from any

such seasonal

and quarterly

fluctuations could

adversely affect

general seasonal

are characteristic

retail apparel

stores typically

higher percentage

profitability in

fiscal period

necessarily indicative

common stock.

The interests of a principal shareholder may limit the ability of

other shareholders to influence the direction

of the Company and otherwise affect our corporate

The interests of our principal shareholder may limit the ability of other shareholders to

influence the

direction of the Company and otherwise affect our corporate governance

and the market price of our

common stock.

As of March 23, 2022, John P.

Cato, Chairman, President and Chief Executive Officer, beneficially

controlled approximately 48.1% of the voting power of

owned approximately 49.8%

of the combined

voting power of

our common stock.

As a result, Mr.

able to control

or significantly influence

substantially

all matters requiring

approval by the

has the ability to substantially influence or determine the outcome of all matters requiring approval by the

shareholders,

including the election

of directors and

the approval of

mergers and other

business combinations or other

significant Company

transactions.

have interests

shareholders, and

shareholders disagree

their interests.

In addition, the

concentration of voting power

Cato could have

the effect of

preventing, discouraging

market price of our common stock.

In the future, if Mr.

Cato acquires beneficial control of more than 50%

of the voting power of

our common stock (including as

a result of continued Company stock

stock repurchase

our outstanding

would qualify for

exemption as a

“controlled company” from

compliance with certain

Exchange corporate governance rules, including the

requirements that we have a

majority of independent

an independent

compensation committee

independent corporate

governance and

nominating committee.

became eligible

these “controlled

company” exceptions, our other shareholders could lose

the benefit of these corporate governance

requirements and the market value of our common stock could be adversely

Conditions in the stock market generally,

or particularly relating to our industry, Company

those of other shareholders, and

may vote in a

way with which other shareholders disagree

or perceive as

adverse to their interests.

The concentration of voting power held by Mr.

Cato could discourage potential

investors from acquiring our

common stock and could

also have the effect

of preventing, discouraging or

deferring a change in control of the Company or other fundamental transaction,

all of which could depress

the market price of our common stock.

In addition, Mr.

Cato has the ability to control the

management of

ownership of more than 50% of the combined voting power of our common stock (including as a result of

continued Company stock

repurchases from time

to time under

our stock repurchase

program that would

corporate governance

requirements and

stock could be adversely affected.

Conditions in the stock market generally, or particularly

relating to our industry, Company or common

stock, may materially and adversely affect the market

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more volatile.

The trading price

of our common

stock at times

has been, and

continue to be,

significant volatility.

A variety of factors

may cause the price of

factors may cause

our common stock to

fluctuate, perhaps

substantially, including,

those discussed

substantially,

trading volume;

general market

fluctuations resulting from

factors not directly

our operations or the inherent value of our

common stock;

fluctuations resulting

our operations or the inherent value of

our common stock;

announcements of developments related to our

1 unchanged sentence

general conditions or trends affecting or perceived

to affect the

fashion and retail industry;

conditions or trends affecting

or perceived to affect

or global economy

or the domestic

or global credit

or capital markets;

changes in financial

coverage given to

our Company by

securities analysts;

egative commentary regarding

corresponding short

-selling market

customer relations

the fashion and

retail industry;

conditions or

trends affecting or

perceived to affect

capital markets;

financial estimates

by securities

commentary regarding

corresponding

short-selling

developments;

significant changes in

our senior management

Over the past

several years

the stock market in

general, and the market

for shares of equity

securities of many retailers

in particular,

have experienced

extreme price

fluctuations that

the operating

performance of those companies.

Such fluctuations and market

volatility based on these

or other factors

significant changes

senior management

legal proceedings.

general, and the

market for shares

securities of many

performance of

those companies.

Such fluctuations

volatility based

may materially and adversely affect the market price of our common stock.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors