**Exhibit 10.1**

 

# **RESTRICTED STOCK AWARD AGREEMENT**

 

*Non-transferable*

GRANT TO

 

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(“Grantee”)

 

by Citi Trends, Inc. (the “Company”) of      shares of its common stock,$0.01 par value (the “Shares”)

 

pursuant to and subject to the provisions of the Citi Trends 2005Long-Term Incentive Plan (the “Plan”) and to the terms and conditions set forthon the following page (the “Terms and Conditions”).  By accepting the Shares, Grantee shall bedeemed to have agreed to the terms and conditions set forth in this Agreementand the Plan.  Capitalized terms usedherein and not otherwise defined shall have the meanings assigned to such termsin the Plan.

 

The Shares will vest (become non-forfeitable)in accordance with the following schedule:

 

| **Years of  Employment  after Grant Date** | ** ** | **Percent  of Shares Vested** | ** ** |
|--------------------------------------------|------------|-------------------------------|------------|
| 1                                          |       | 25                            | %          |
| 2                                          |       | 50                            | %          |
| 3                                          |       | 75                            | %          |
| 4                                          |       | 100                           | %          |

 

IN WITNESS WHEREOF, Citi Trends, Inc.,acting by and through its duly authorized officers, has caused this Agreementto be duly executed.

 

CITI TRENDS, INC.

 
| By: |   |   | Grant Date: |   |
|-----|--------|--------|-------------|--------|

 

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**TERMS ANDCONDITIONS**

 

1. Restrictions.The Shares are subject to each of the following restrictions. “RestrictedShares” mean those Shares that are subject to the restrictions imposedhereunder which restrictions have not then expired or terminated. RestrictedShares may not be sold, transferred, exchanged, assigned, pledged, hypothecatedor otherwise encumbered. If Grantee’s employment with the Company or anySubsidiary terminates for any reason, then Grantee shall forfeit all of Grantee’sright, title and interest in and to the Restricted Shares as of the date ofemployment termination, and such Restricted Shares shall revert to the Companyimmediately following the event of forfeiture. The restrictions imposed underthis Section shall apply to all shares of the Company’s Stock or othersecurities issued with respect to Restricted Shares hereunder in connectionwith any merger, reorganization, consolidation, recapitalization, stockdividend or other change in corporate structure affecting the Stock of the Company.

 

2. Expiration and Termination of Restrictions.The restrictions imposed under Section 1 will expire on the earliest tooccur of the following (the period prior to such expiration being referred toherein as the “Restricted Period”):

 

(a)   asto the percentages of the Shares specified on the cover page hereof, onthe respective dates specified on the cover page hereof; provided Granteeis then employed by the Company; or

 

(b)   uponGrantee’s death or Disability, but only with respect to the number of Sharesthat would otherwise have vested within the 12 months following the death orDisability based on Grantee’s continued employment with the Company; or

 

(c)   upona Change of Control of the Company.

 

3. Delivery ofShares. The Shares will be registered in the name of Grantee as of theGrant Date and may be held by the Company during the Restricted Period incertificated or uncertificated form. If a certificate for Restricted Shares isissued during the Restricted Period with respect to such Shares, suchcertificate shall be registered in the name of Grantee and shall bear a legendin substantially the following form (in addition to any legend required underapplicable state securities laws): “This certificate and the shares of stockrepresented hereby are subject to the terms and conditions (includingforfeiture and restrictions against transfer) contained in a Restricted Stock Agreementbetween the registered owner of the shares represented hereby and Citi Trends, Inc.Release from such terms and conditions shall be made only in accordance withthe provisions of such Agreement, copies of which are on file in the offices ofCiti Trends, Inc.”  Stockcertificates for the Shares, without the first above legend, shall be deliveredto Grantee or Grantee’s designee upon request of Grantee after the expirationof the Restricted Period, but delivery may be postponed for such period as maybe required for the Company with reasonable diligence to comply, if deemedadvisable by the Company, with registration requirements under the SecuritiesAct of 1933, listing requirements under the rules of any stock exchange,and requirements under any other law or regulation applicable to the issuanceor transfer of the Shares.

 

4. VotingRights. Grantee, as beneficial owner of the Shares, shall have full voting rightswith respect to the Shares during and after the Restricted Period.

 

5. DividendRights.  Grantee shall accrue cashand non-cash dividends, if any, paid with respect to the Restricted Shares, butthe payment of such dividends shall be deferred and held (without interest) bythe Company for the account of Grantee until the expiration of the RestrictedPeriod.  During the Restricted Period,such dividends shall be subject to the same vesting restrictions imposed under Section 1as the Restricted Shares to which they relate.  Accrued dividends deferred and held pursuantto the foregoing provision shall be paid by the Company to the Grantee promptlyupon the expiration of the Restricted Period (and in any event within 30 daysof the date of such expiration).

 

6. No Right ofContinued Employment. Nothing in this Agreement shall interfere with orlimit in any way the right of the Company to terminate Grantee’s employment atany time, nor confer upon Grantee any right to continue in the employ of theCompany.

 

7. Payment ofTaxes.

 

(a)   Uponissuance of the Shares hereunder, Grantee may make an election to be taxed uponsuch award under Section 83(b) of the Internal Revenue Code.  To effect such election, Grantee may file anappropriate election with Internal Revenue Service within thirty (30) daysafter award of the Shares and otherwise in accordance with applicable TreasuryRegulations.

 

(b)   Granteewill, no later than the date as of which any amount related to the Shares firstbecomes includable in Grantee’s gross income for federal income tax purposes,pay to the Company, or make other arrangements satisfactory to the Committeeregarding payment of, any federal, state and local taxes of any kind requiredby law to be withheld with respect to such amount, including without limitationthe surrender of shares of Stock to the Company. The obligations of the Companyunder this Agreement will be conditional on such payment or arrangements, andthe Company will, to the extent permitted by law, have the right to deduct anysuch taxes from the award or any payment of any kind otherwise due to Grantee.

 

8. PlanControls. The terms contained in the Plan are incorporated into and made apart of this Agreement and this Agreement shall be governed by and construed inaccordance with the Plan. In the event of any actual or alleged conflictbetween the provisions of the Plan and the provisions of this Agreement, theprovisions of the Plan shall be controlling and determinative.

 

9.  Successors.  This Agreement shall be binding upon anysuccessor of the Company, in accordance with the terms of this Agreement andthe Plan.

 

10.  Severability.  If any one or more of the provisionscontained in this Agreement is invalid, illegal or unenforceable, the otherprovisions of this Agreement will be construed and enforced as if the invalid,illegal or unenforceable provision had never been included.

 

11. Notice.Notices and communications under this Agreement must be in writing and eitherpersonally delivered or sent by registered or certified United States mail,return receipt requested, postage prepaid. Notices to the Company must beaddressed to Citi Trends, Inc., 104 Coleman Blvd. Savannah, GA 31408, Attn:Secretary, or any other address designated by the Company in a written noticeto Grantee. Notices to Grantee will be directed to the address of Grantee thencurrently on file with the Company, or at any other address given by Grantee ina written notice to the Company.

 

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