Document:

Exhibit
10.2

[Bank of America LOGO]

LOAN
AGREEMENT

This Agreement dated as
of June 8, 2006, is between Bank of America, N.A. (the “Bank”) and
Citi Trends, Inc. (the “Borrower”).

1.                                       FACILITY
NO. 1: LINE OF CREDIT AMOUNT AND TERMS

1.1                                 Line
of Credit Amount.

(a)                                  During
the availability period described below, the Bank will provide a line of credit
to the Borrower. The amount of the line of credit (the “Facility No. 1
Commitment”) is Three Million and 00/100 Dollars ($3,000,000.00).

(b)                                 This
is a revolving line of credit. During the availability period, the Borrower may
repay principal amounts and reborrow them.

(c)                                  The
Borrower agrees not to permit the principal balance outstanding to exceed the
Facility No. 1 Commitment. If the Borrower exceeds this limit, the
Borrower will immediately pay the excess to the Bank upon the Bank’s demand.

1.2             Availability Period.  The
line of credit is available between the date of this Agreement and
June 26, 2007, or such earlier date as the availability may terminate as
provided in this Agreement (the “Facility No. 1 Expiration Date”).

The availability period
for this line of credit will be considered renewed if and only if the Bank has
sent to the Borrower a written notice of renewal effective as of the Facility
No. 1 Expiration Date for the line of credit (the “Renewal Notice”). If
this line of credit is renewed, it will continue to be subject to all the terms
and conditions set forth in this Agreement except as modified by the Renewal
Notice. If this line of credit is renewed, the term “Expiration Date” shall
mean the date set forth in the Renewal Notice as the Expiration Date and the
same process for renewal will apply to any subsequent renewal of this line of
credit.

1.3                                 Repayment
Terms.

(a)                                  The
Borrower will pay interest on July 26, 2006, and then on the same day of
each month thereafter until payment in full of any principal outstanding under
this facility.

(b)                                 The
Borrower will repay in full any principal, interest or other charges
outstanding under this facility no later than the Facility No. 1
Expiration Date.

1.4                                 Interest
Rate.

(a)                                  The
interest rate is a rate per year equal to the BBA LIBOR Daily Floating Rate
plus 2 percentage point(s).

(b)                                 The
BBA LIBOR Daily Floating Rate is a fluctuating rate of interest equal to the rate
per annum equal to the British Bankers Association LIBOR Rate (“BBA LIBOR”), as
published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as selected by the Bank from time to time as determined
for each banking day at approximately 11:00 a.m. London time two (2)
London Banking Days prior to the date in question, for U.S. Dollar deposits
(for delivery on the first day of such interest period) with a one month term,
as adjusted from time to time in the Bank’s sole discretion for reserve
requirements, deposit insurance assessment rates and other regulatory costs. If
such rate is not available at such time for any reason, then the rate for that
interest period will be determined by such alternate method as reasonably selected
by the Bank. A “London Banking Day” is a day on which banks in London are open
for business and dealing in offshore dollars.

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2.             FEES AND EXPENSES

2.1           Fees.

(a)                                  Unused
Commitment Fee.  The Borrower agrees to pay a fee on any
difference between the Facility No. 1 Commitment and the amount of credit
it actually uses, determined by the average of the daily amount of credit
outstanding during the specified period. The fee will be calculated at 0.125%
per year.

This fee is due on
September 26, 2006, and on the same day of each following quarter until
the expiration of the availability period.

(b)                                 Late
Fee.  To the extent permitted by law, the Borrower agrees to pay
a late fee in an amount not to exceed four percent (4%) of any payment that is
more than fifteen (15) days late. The imposition and payment of a late fee
shall not constitute a waiver of the Bank’s rights with respect to the default.

2.2             Expenses.  The
Borrower agrees to immediately repay the Bank for expenses that include, but
are not limited to, filing, recording and search fees, appraisal fees, title
report fees, and documentation fees.

2.3                                 Reimbursement
Costs.

(a)                                  The
Borrower agrees to reimburse the Bank for any expenses it incurs in the
preparation of this Agreement and any agreement or instrument required by this
Agreement. Expenses include, but are not limited to, reasonable attorneys’
fees, including any allocated costs of the Bank’s in-house counsel to the
extent permitted by applicable law.

3.                                       DISBURSEMENTS,
PAYMENTS AND COSTS

3.1                                 Disbursements
and Payments.

(a)                                  Each
payment by the Borrower will be made in U.S. Dollars and immediately available
funds by direct debit to a deposit account as specified below or, for payments
not required to be made by direct debit, by mail to the address shown on the
Borrower’s statement or at one of the Bank’s banking centers in the United
States.

(b)                                 Each
disbursement by the Bank and each payment by the Borrower will be evidenced by
records kept by the Bank. In addition, the Bank may, at its discretion, require
the Borrower to sign one or more promissory notes.

3.2                                 Telephone
and Telefax Authorization.

(a)                                  The
Bank may honor telephone or telefax instructions for advances or repayments
given, or purported to be given, by any one of the individuals authorized to sign
loan agreements on behalf of the Borrower, or any other individual designated
by any one of such authorized signers.

(b)                                 Advances
will be deposited in the repayments will be withdrawn from account number
3257772600 owned by the Borrower or such other of the Borrower’s accounts with
the Bank as designated in writing by the Borrower.

(c)                                  The
Borrower will indemnify and hold the Bank harmless from all liability, loss,
and costs in connection with any act resulting from telephone or telefax
instructions the Bank reasonably believes are made by any individual authorized
by the Borrower to give such instructions. This paragraph will survive this
Agreement’s termination, and will benefit the Bank and its officers, employees,
and agents.

3.3                                 Direct
Debit (Pre-Billing).

(a)                                  The
Borrower agrees that the Bank will debit deposit account number 3257772600
owned by the Borrower or such other of the Borrower’s accounts with the Bank as
designated in writing by the Borrower (the “Designated Account”) on the date
each payment of principal and interest and any fees from the Borrower becomes
due (the “Due Date”).

(b)                                 Prior
to each Due Date, the Bank will mail to the Borrower a statement of the amounts
that will be due on that Due Date (the “Billed Amount”). The bill will be
mailed a specified number of calendar days prior to the Due Date, which number
of days will be mutually agreed from time to time by the Bank and the Borrower.
The calculations

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in the bill will be made on the assumption that no new extensions of
credit or payments will be made between the date of the billing statement and
the Due Date, and that there will be no changes in the applicable interest
rate.

(c)                                  The
Bank will debit the Designated Account for the Billed Amount, regardless of the
actual amount due on that date (the “Accrued Amount”). If the Billed Amount
debited to the Designated Account differs from the Accrued Amount, the
discrepancy will be treated as follows:

(i)                                     If
the Billed Amount is less than the Accrued Amount, the Billed Amount for the
following Due Date will be increased by the amount of the discrepancy. The
Borrower will not be in default by reason of any such discrepancy.

(ii)                                  If
the Billed Amount is more than the Accrued Amount, the Billed Amount for the
following Due Date will be decreased by the amount of the discrepancy.

Regardless of any such discrepancy, interest will continue to accrue
based on the actual amount of principal outstanding without compounding. The
Bank will not pay the Borrower interest on any overpayment.

(d)                                 The
Borrower will maintain sufficient funds in the Designated Account to cover each
debit. If there are insufficient funds in the Designated Account on the date
the Bank enters any debit authorized by this Agreement, the Bank may reverse
the debit.

(e)                                  The
Borrower may terminate this direct debit arrangement at any time by sending
written notice to the Bank at the address specified at the end of this
Agreement. If the Borrower terminates this arrangement, then the principal
amount outstanding under this Agreement will at the option of the Bank bear
interest at a rate per annum which is 0.5 percentage point(s) higher than
the rate of interest otherwise provided under this Agreement.

3.4           Banking Days.  Unless
otherwise provided in this Agreement, a banking day is a day other than a
Saturday, Sunday or other day on which commercial banks are authorized to
close, or are in fact closed, in the state where the Bank’s lending office is
located, and, if such day relates to amounts bearing interest at an offshore
rate (if any), means any such day on which dealings in dollar deposits are
conducted among banks in the offshore dollar interbank market. All payments and
disbursements which would be due on a day which is not a banking day will be
due on the next banking day. All payments received on a day which is not a
banking day will be applied to the credit on the next banking day.

3.5           Interest Calculation.  Except
as otherwise stated in this Agreement, all interest and fees, if any, will be
computed on the basis of a 360-day year and the actual number of days elapsed.
This results in more interest or a higher fee than if a 365-day year is used.
Installments of principal which are not paid when due under this Agreement
shall continue to bear interest until paid.

3.6           Default Rate.  Upon
the occurrence of any default or after maturity or after judgement has been
rendered on any obligation under this Agreement, all amounts outstanding under
this Agreement, including any interest, fees, or costs which are not paid when
due, will at the option of the Bank bear interest at a rate which is
6.0 percentage point(s) higher than the rate of interest otherwise
provided under this Agreement. This may result in compounding of interest. This
will not constitute a waiver of any default.

4.                                       CONDITIONS

Before the Bank is
required to extend any credit to the Borrower under this Agreement, it much
receive any documents and other items it may reasonably require, in form and
content acceptable to the Bank, including any items specifically listed below.

4.1           Authorizations.  If
the Borrower or any guarantor is anything other than a natural person, evidence
that the execution, delivery and performance by the Borrower and/or such
guarantor of this Agreement and any instrument or agreement required under this
Agreement have been duly authorized.

4.2           Governing Documents.  If
required by the Bank, a copy of the Borrower’s organizational documents.

4.3           Good Standing.  Certificates
of good standing for the Borrower from its state of formation and from any
other state in which the Borrower is required to qualify to conduct its
business.

4.4           Insurance.  Evidence
of insurance coverage, as required in the “Covenants” section of this
Agreement.

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5.             REPRESENTATIONS AND WARRANTIES

When the Borrower signs
this Agreement, and until the Bank is repaid in full, the Borrower makes the
following representations and warranties. Each request for an extension of
credit constitutes a renewal of these representations and warranties as of the
date of the request:

5.1           Formation.  If the
Borrower is anything other than a natural person, it is duly formed and
existing under the laws of the state or other jurisdiction where organized.

5.2           Authorization.  This
Agreement, and any instrument or agreement required hereunder, are within the
Borrower’s powers, have been duly authorized, and do not conflict with any of
its organizational papers.

5.3           Enforceable Agreement.  This
Agreement is a legal, valid and binding agreement of the Borrower, enforceable
against the Borrower in accordance with its terms, and any instrument or
agreement required hereunder, when executed and delivered, will be similarly
legal, valid, binding and enforceable.

5.4           Good Standing.  In
each state in which the Borrower does business, it is properly licensed, in
good standing, and, where required, in compliance with fictitious name
statutes.

5.5           No Conflicts.  This
Agreement does not conflict with any law, agreement, or obligation by which the
Borrower is bound.

5.6           Financial Information.  All
financial and other information that has been or will be supplied to the Bank
is sufficiently complete to give the Bank accurate knowledge of the Borrower’s
(and any guarantor’s) financial condition, including all material contingent liabilities.
Since the date of the most recent financial statement provided to the Bank,
there has been no material adverse change in the business condition (financial
or otherwise), operations, properties or prospects of the Borrower (or any
guarantor). If the Borrower is comprised of the trustees of a trust, the
foregoing representations shall also pertain to the trustor(s) of the trust.

5.7           Lawsuits.  There is
no lawsuit, tax claim or other dispute pending or threatened against the
Borrower which, if lost, would impair the Borrower’s financial condition or
ability to repay the loan, except as have been disclosed in writing to the
Bank.

5.8           Permits, Franchises.  The
Borrower possesses all permits, memberships, franchises, contracts and licenses
required and all trademark rights, trade name rights, patent rights, copyrights
and fictitious name rights necessary to enable it to conduct the business in
which it is now engaged.

5.9           Other Obligations.  The
Borrower is not in default on any obligation for borrowed money, any purchase
money obligation or any other material lease, commitment, contract, instrument
or obligation, except as have been disclosed in writing to the Bank.

5.10         Tax Matters.  The
Borrower has no knowledge of any pending assessments or adjustments of its
income tax for any year and all taxes due have been paid, except as have been
disclosed in writing to the Bank.

5.11         No Event of Default.  There
is no event which is, or with notice or lapse of time or both would be, a
default under this Agreement.

5.12         Insurance.  The
Borrower has obtained, and maintained in effect, the insurance coverage
required in the “Covenants” section of this Agreement.

6.             COVENANTS

The Borrower agrees, so
long as credit is available under this Agreement and until the Bank is repaid
in full:

6.1           Uses of proceeds.

(a)                                  To
use the proceeds of Facility No. 1 only for working capital.

(b)                                 The
proceeds of the credit extended under this Loan Agreement may not be used
directly or indirectly to purchase or carry any “margin stock” as that term is
defined in Regulation U of the Board of Governors of the Federal

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Reserve System, or extend credit to or invest in other parties for the
purpose of purchasing or carrying any such “margin stock,” or to reduce or
retire any indebtedness incurred for such purpose.

6.2           Financial Information.  To
provide the following financial information and statements in form and content
acceptable to the Bank, and such additional information as requested by the
Bank from time to time:

(a)                                  A
copy of the Form 10-K Annual Report for the Borrower within one hundred
twenty (120) days after the date of filing with the Securities and Exchange
Commission.

(b)                                 A
copy of the Form 10-Q Quarterly Report for the Borrower for the quarter
ending each July 31 within forty five (45) days after the date of filing
with the Securities and Exchange Commission.

6.3           Bank as Principal
Depository.  To maintain the Bank as its principal depository bank,
including for the maintenance of business, cash management, operating and
administrative deposit accounts.

6.4           Maintenance of Assets.

(a)                                  Not
to sell, assign, lease, transfer or otherwise dispose of any part of the
Borrower’s business or the Borrower’s assets except in the ordinary course of
the Borrower’s business.

(b)                                 Not
to sell, assign, lease, transfer or otherwise dispose of any assets for less
than fair market value, or enter into any agreement to do so.

(c)                                  Not
to enter into any sale and leaseback agreement covering any of its fixed
assets.

(d)                                 To
maintain and preserve all rights, privileges, and franchises the Borrower now
has.

(e)                                  To
make any repairs, renewals, or replacements to keep the Borrower’s properties
in good working condition.

6.5           Investments.  Not to
have any existing, or make any new, investments in any individual or entity, or
make any capital contributions or other transfers of assets to any individual
or entity, except for:

(a)                                  Existing
investments disclosed to the Bank in writing.

(b)                                 Investments
in the Borrower’s current subsidiaries.

(c)                                  Investments
in any of the following:

(i)                                     certificates
of deposit;

(ii)                                  U.S.
treasury bills and other obligations of the federal government;

(iii)                               readily marketable
securities (including commercial paper, but excluding restricted stock and
stock subject to the provisions of Rule 144 of the Securities and Exchange
Commission).

6.6           Loans.  Not to make
any loans, advances or other extensions of credit to any individual or entity,
except for:

(a)                                  Existing
extensions of credit disclosed to the Bank in writing.

(b)                                 Extensions
of credit to the Borrower’s current subsidiaries.

(c)                                  Extensions
of credit in the nature of accounts receivable or notes receivable arising from
the sale or lease of goods or services in the ordinary course of business to
non-affiliated entities.

6.7           Change of Management.  Not
to make any substantial change in the present executive or management personnel
of the Borrower.

6.8           Change of Ownership.  Not
to cause, permit, or suffer any change in capital ownership such that there is
a

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change of more than
twenty-five percent (25%) in the direct or indirect capital ownership of the
Borrower.

6.9           Additional Negative Covenants.  Not
to, without the Bank’s written consent:

(a)                                  Enter
into any consolidation, merger, or other combination, or become a partner in a
partnership, a member of a joint venture, or a member of a limited liability
company.

(b)                                 Acquire
or purchase a business or its assets.

(c)                                  Engage
in any business activities substantially different from the Borrower’s present
business.

(d)                                 Liquidate
or dissolve the Borrower’s business.

6.10                           Notices
to Bank.  To promptly notify the Bank in writing of:

(a)                                  Any
lawsuit over Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) against
the Borrower (or any guarantor or, if the Borrower is comprised of the trustees
of a trust, any trustor).

(b)                                 Any
substantial dispute between any governmental authority and the Borrower (or any
guarantor or, if the Borrower is comprised of the trustees of a trust, any
trustor).

(c)                                  Any
event of default under this Agreement, or any event which, with notice or lapse
of time or both, would constitute an event of default.

(d)                                 Any
material adverse change in the Borrower’s (or any guarantor’s, or, if the
Borrower is comprised of the trustees of a trust, any trustor’s) business
condition (financial or otherwise), operations, properties or prospects, or
ability to repay the credit.

(e)                                  Any
change in the Borrower’s name, legal structure, place of business, or chief
executive office if the Borrower has more than one place of business.

(f)                                    Any
actual contingent liabilities of the Borrower (or any guarantor or, if the
Borrower is comprised of the trustees of a trust, any trustor), and any such
contingent liabilities which are reasonably foreseeable.

6.11         Insurance.

(a)                                  General
Business Insurance.  To maintain insurance satisfactory to the
Bank as to amount, nature and carrier covering property damage (including loss
of use and occupancy) to any of the Borrower’s properties, business
interruption insurance, public liability insurance including coverage for
contractual liability, product liability and workers’ compensation, and any
other insurance which is usual for the Borrower’s business. Each policy shall
provide for at least 30 days prior notice to the Bank of any cancellation
thereof.

6.12         Compliance with Laws.  To
comply with the laws (including any fictitious or trade name statute),
regulations, and orders of any government body with authority over the
Borrower’s business. The Bank shall have no obligation to make any advance to
the Borrower’s except in compliance with all applicable laws and regulations and
the Borrower’s shall fully cooperate with the Bank in complying with all such
applicable laws and regulations.

6.13         ERISA Plans.  Promptly
during each year, to pay and cause any subsidiaries to pay contributions
adequate to meet at least the minimum funding standards under ERISA with
respect to each and every Plan; file each annual report required to be filed
pursuant to ERISA in connection with each Plan for each year; and notify the
Bank within ten (10) days of the occurrence of any Reportable Event that might
constitute grounds for termination of any capital Plan by the Pension Benefit
Guaranty Corporation or for the appointment by the appropriate United States
District Court of a trustee to administer any Plan. “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended from time to time.
Capitalized terms in this paragraph shall have the meanings defined within
ERISA.

6.14         Books and Records.  To
maintain adequate books and records.

6.15                           Audits.  To
allow the Bank and its agents to inspect the Borrower’s properties and examine,
audit, and make

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copies of books and records at any reasonable time. If
any of the Borrower’s properties, books or records are in the possession of a
third party, the Borrower authorizes that third party to permit the Bank or its
agents to have access to perform inspections or audits and to respond to the
Bank’s requests for information concerning such properties, books and records.

6.16         Cooperation.  To
take any action reasonably requested by the Bank to carry out the intent of
this Agreement.

7.             DEFAULT
AND REMEDIES

If any of the following events of default occurs, the
Bank may do one or more of the following: declare the Borrower in default, stop
making any additional credit available to the Borrower, and require the
Borrower to repay its entire debt immediately and without prior notice. If an
event which, with notice or the passage of time, will constitute an event of
default has occurred and is continuing, the Bank has no obligation to make
advances or extend additional credit under this Agreement. In addition, if any
event of default occurs, the Bank shall have all rights, powers and remedies
available under any instruments and agreements required by or executed in
connection with this Agreement, as well as all rights and remedies available at
law or in equity. If an event of default occurs under the paragraph entitled
“Bankruptcy,” below, with respect to the Borrower, then the entire debt
outstanding under this Agreement will automatically be due immediately.

7.1           Failure to Pay.  The
Borrower fails to make a payment under this Agreement when due.

7.2           Other Bank Agreements.  Any
default occurs under any other agreement the Borrower (or any Obligor) or any
of the Borrower’s related entities or affiliates has with the Bank or any
affiliate of the Bank. For purposes of this Agreement, “Obligor” shall mean any
guarantor, any party pledging collateral to the Bank, or, if the Borrower is
comprised of the trustees of a trust, any trustor.

7.3           Cross-default.  Any
default occurs under any agreement in connection with any credit the Borrower
(or any Obligor) or any of the Borrower’s related entities or affiliates has
obtained from anyone else or which the Borrower (or any Obligor) or any of the
Borrower’s related entities or affiliates has guaranteed.

7.4           False Information.  The
Borrower or any Obligor has given the Bank false or misleading information or
representations.

7.5           Bankruptcy.  The
Borrower, any Obligor, or any general partner of the Borrower or of any Obligor
files a bankruptcy petition, a bankruptcy petition is filed against any of the
foregoing parties, or the Borrower, any Obligor, or any general partner of the
Borrower or of any Obligor makes a general assignment for the benefit of
creditors.

7.6           Receivers.  A receiver
or similar official is appointed for a substantial portion of the Borrower’s or
any Obligor’s business, or the business is terminated, or, if any Obligor is
anything other than a natural person, such Obligor is liquidated or dissolved.

7.7           Judgments.  Any
judgments or arbitration awards are entered against the Borrower or any
Obligor, or the Borrower or any Obligor enters into any settlement agreements
with respect to any litigation or arbitration, in an aggregate amount of Two
Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) or more in excess of
any insurance coverage.

7.8           Material Adverse Change.  A
material adverse change occurs, or is reasonably likely to occur, in the
Borrower’s (or any Obligor’s) business condition (financial or otherwise),
operations, properties or prospects, or ability to repay the credit; or the
Bank determines that it is insecure for any other reason.

7.9           Government Action.  Any
government authority takes action that the Bank believes materially adversely
affects the Borrower’s or any Obligor’s financial condition or ability to
repay.

7.10         Default under Related Documents.  Any
default occurs under any guaranty, subordination agreement, security agreement,
deed of trust, mortgage, or other document required by or delivered in
connection with this Agreement or any such document is no longer in effect, or
any guarantor purports to revoke or disavow the guaranty.

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7.11         ERISA Plans.  Any one
or more of the following events occurs with respect to a Plan of the Borrower
subject to Title IV of ERISA, provided such event or events could reasonably be
expected, in the judgment of the Bank, to subject the Borrower to any tax,
penalty or liability (or any combination of the foregoing) which, in the
aggregate, could have a material adverse effect on the financial condition of
the Borrower:

(a)                                  A
reportable event shall occur under Section 4043(c) of ERISA with respect to a
Plan.

(b)                                 Any
Plan termination (or commencement of proceedings to terminate a Plan) or the
full or partial withdrawal from a Plan by the Borrower or any ERISA Affiliate.

7.12         Other Breach Under Agreement.  A
default occurs under any other term or condition of this Agreement not
specifically referred to in this Article. This includes any failure or
anticipated failure by the Borrower (or any other party named in the Covenants
section) to comply with the financial covenants set forth in this Agreement,
whether such failure is evidenced by financial statements delivered to the Bank
or is otherwise known to the Borrower or the Bank.

8.             ENFORCING THIS AGREEMENT; MISCELLANEOUS

8.1           GAAP.  Except as
otherwise stated in this Agreement, all financial information provided to the
Bank and all financial covenants will be made under generally accepted
accounting principles, consistently applied.

8.2           Georgia Law.  This
Agreement is governed by Georgia state law.

8.3           Successors and Assigns.  This
Agreement is binding on the Borrower’s and the Bank’s successors and assignees.
The Borrower agrees that it may not assign this Agreement without the Bank’s
prior consent. The Bank may sell participations in or assign this loan, and may
exchange information about the Borrower (including, without limitation, any
information regarding any hazardous substances) with actual or potential
participants or assignees. If a participation is sold or the loan is assigned,
the purchaser will have the right of set-off against the Borrower.

8.4           Arbitration

(a)                                  This
paragraph concerns the resolution of any controversies or claims between the
parties, whether arising in contract, tort or by statute, including but not
limited to controversies or claims that arise out of or relate to: (i) this
agreement (including any renewals, extensions or modifications); or (ii) any
document related to this agreement (collectively a “Claim”). For the purposes
of this arbitration provision only, the term “parties” shall include any parent
corporation, subsidiary or affiliate of the Bank involved in the servicing,
management or administration of any obligation described or evidenced by this
agreement.

(b)                                 At
the request of any party to this agreement, any Claim shall be resolved by
binding arbitration in accordance with the Federal Arbitration Act (Title 9,
U.S. Code) (the “Act”). The Act will apply even though this agreement provides
that it is governed by the law of a specified state. The arbitration will take
place on an individual basis without resort to any form of class action.

(c)                                  Arbitration
proceedings will be determined in accordance with the Act, the then-current
rules and procedures for the arbitration of financial services disputes of the
American Arbitration Association or any successor thereof (“AAA”), and the
terms of this paragraph. In the event of any inconsistency, the terms of this
paragraph shall control. If AAA is unwilling or unable to (i) serve as the
provider of arbitration or (ii) enforce any provision of this arbitration
clause, any party to this agreement may substitute another arbitration
organization with similar procedures to serve as the provider of arbitration.

(d)                                 The
arbitration shall be administered by AAA and conducted, unless otherwise
required by law, in any U.S. state where real or tangible personal property
collateral for this credit is located or if there is no such collateral, in the
state specified in the governing law section of this agreement. All Claims
shall be determined by one arbitrator; however, if Claims exceed Five Million
Dollars ($5,000,000), upon the request of any party, the Claims shall be
decided by three arbitrators. All arbitration hearings shall commence within
ninety (90) days of the demand for arbitration and close within ninety (90)
days of commencement and the award of the arbitrator(s) shall be issued within
thirty (30) days of the close of the hearing. However, the arbitrator(s), upon
a showing of good cause, may extend the commencement of the hearing for up to
an additional sixty (60) days, The arbitrator(s) shall provide a concise
written statement of reasons for the award. The arbitration award may be
submitted to any court having jurisdiction to be confirmed, judgment entered
and enforced.

 8
 

 

(e)                                  The
arbitrator(s) will give effect to statutes of limitation in determining any
Claim and may dismiss the arbitration on the basis that the Claim is barred.
For purposes of the application of the statute of limitations, the service on
AAA under applicable AAA rules of a notice of Claim is the equivalent of the
filing of a lawsuit. Any dispute concerning this arbitration provision or
whether a Claim is arbitrable shall be determined by the arbitrator(s). The
arbitrator(s) shall have the power to award legal fees pursuant to the terms of
this agreement.

(f)                                    This
paragraph does not limit the right of any party to: (i) exercise self-help
remedies, such as but not limited to, setoff; (ii) initiate judicial or
non-judicial foreclosure against any real or personal property collateral;
(iii) exercise any judicial or power of sale rights, or (iv) act in a court of
law to obtain an interim remedy, such as but not limited to, injunctive relief,
writ of possession or appointment of a receiver, or additional or supplementary
remedies.

(g)                                 The
filing of a court action is not intended to constitute a waiver of the right of
any party, including the suing party, thereafter to require submittal of the
Claim to arbitration.

8.5           Severability; Waivers.  If
any part of this Agreement is not enforceable, the rest of the Agreement may be
enforced. The Bank retains all rights, even if it makes a loan after default.
If the Bank waives a default, it may enforce a later default. Any consent or
waiver under this Agreement must be in writing.

8.6           Attorneys’ Fees.  The
Borrower shall reimburse the Bank for any reasonable costs and attorneys’ fees
incurred by the Bank in connection with the enforcement or preservation of any
rights or remedies under this Agreement and any other documents executed in
connection with this Agreement, and in connection with any amendment, waiver,
“workout” or restructuring under this Agreement. In the event of a lawsuit or
arbitration proceeding, the prevailing party is entitled to recover costs and
reasonable attorneys’ fees incurred in connection with the lawsuit or
arbitration proceeding, as determined by the court or arbitrator: In the event
that any case is commenced by or against the Borrower under the Bankruptcy Code
(Title 11, United States Code) or any similar or successor statute, the Bank is
entitled to recover costs and reasonable attorneys’ fees incurred by the Bank
related to the preservation, protection, or enforcement of any rights of the
Bank in such a case. As used in this paragraph, “attorneys’ fees” includes the
allocated costs of the Bank’s in house counsel.

8.7           One Agreement.  This
Agreement and any related security or other agreements required by this
Agreement, collectively:

(a)                                  represent
the sum of the understandings and agreements between the Bank and the Borrower
concerning this credit;

(b)                                 replace
any prior oral or written agreements between the Bank and the Borrower
concerning this credit; and

(c)                                  are
intended by the Bank and the Borrower as the final, complete and exclusive
statement of the terms agreed to by them.

In the event of any
conflict between this Agreement and any other agreements required by this
Agreement, this Agreement will prevail. Any reference in any related document
to a “promissory note” or a “note” executed by the Borrower and dated as of the
date of this Agreement shall be deemed to refer to this Agreement, as now in
effect or as hereafter amended, renewed, or restated.

8.8           Indemnification.  The
Borrower will indemnify and hold the Bank harmless from any loss, liability,
damages, judgments, and costs of any kind relating to or arising directly or
indirectly out of (a) this Agreement or any document required hereunder, (b)
any credit extended or committed by the Bank to the Borrower hereunder, and (c)
any litigation or proceeding related to or arising out of this Agreement, any
such document, or any such credit. This indemnity includes but is not limited
to attorneys’ fees (including the allocated cost of in-house counsel). This
indemnity extends to the Bank, its parent, subsidiaries and all of their
directors, officers, employees, agents, successors, attorneys, and assigns.
This indemnity will survive repayment of the Borrower’s obligations to the
Bank. All sums due to the Bank hereunder shall be obligations of the Borrower,
due and payable immediately without demand.

8.9           Notices.  Unless
otherwise provided in this Agreement or in another agreement between the Bank
and the Borrower, all notices required under this Agreement shall be personally
delivered or sent by first class mail, postage prepaid, or by overnight
courier, to the addresses on the signature page of this Agreement, or sent by
facsimile to the fax numbers listed on the signature page, or to such other
addresses as the Bank and the Borrower may specify from time to time in
writing. Notices and other communications shall be effective (i) if mailed,
upon the earlier of receipt or five (5) days after deposit in the U.S. mail,
first class, postage prepaid, (ii) if telecopied, when transmitted, or (iii) if
hand-delivered, by courier or otherwise (including telegram, lettergram or
mailgram), when delivered.

 9
 

 

810          Headings.  Article
and paragraph headings are for reference only and shall not affect the
interpretation or meaning of any provisions of this Agreement.

8.11         Counterparts.  This
Agreement may be executed in as many counterparts as necessary or convenient,
and by the different parties on separate counterparts each of which, when so
executed, shall be deemed an original but all such counterparts shall
constitute but one and the same agreement.

8.12         Prior Agreement Superseded.  This
Agreement supersedes the Business Loan Agreement entered into as of June 26,
2003, between the Bank and the Borrower, and any credit outstanding thereunder
shall be deemed to be outstanding under this Agreement.

8.13         “Interest” Limited.  As
used in this Agreement the term “interest” does not include any fees
(including, but not limited to, any loan fee, periodic fee, unused commitment
fee or waiver fee) or other charges imposed on the Borrower in connection with
the indebtedness evidenced by this Agreement, other than the interest described
above. In no event shall the amount or rate of interest due and payable under
this Agreement exceed the maximum amount or rate of interest allowed by
applicable law and, in the event any such excess payment is made by the
Borrower or received by the Bank, such excess sum shall be credited as a
payment of principal (or if no principal shall remain outstanding, shall be
refunded to the Borrower). It is the express intent hereof that the Borrower
not pay and the Bank not receive, directly or indirectly, interest in excess of
that which may be lawfully paid under applicable law including the usury laws
in force in the State of Georgia.

This Agreement is executed as of the date stated at the top of the
first page.

 10
 

 

 

	
  Borrower:

  	
   

  	
  Bank:

  
	
   

  	
   

  	
   

  	
   

  
	
  Citi Trends,
  Inc.

  	
   

  	
  Bank of America, N.A.

  
	
   

  	
   

  	
   

  	
   

  
	
  By: /s/ Tom Stoltz                                                          (Seal)

  	
   

  	
  By:

  	
  /s/ Steven R. Price

  
	
  Tom Stoltz,
  Chief Financial Officer

  	
   

  	
   

  	
  Steven R. Price, Senior
  Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

	
  Address where notices to
  Citi Trends, Inc. are to be sent:

  	
   

  	
  Address where notices
  to the Bank are to be sent:

  
	
   

  	
   

  	
   

  
	
  104 Coleman
  Boulevard

  	
   

  	
  Jacksonville - Attn:
  Notice Desk

  
	
  Savannah,
  Georgia 31401-9565

  	
   

  	
  FL9-100-03-15

  
	
   

  	
   

  	
  9000 Southside Blvd.,
  3rd Floor

  
	
   

  	
   

  	
  Jacksonville, FL 32256

  
	
   

  	
   

  	
   

  
	
  Telephone:  

  	
   

  	
                                

  	
   

  	
   

  	
   

  	
  Facsimile:  800-262-4274

  
	
  Facsimile:   

  	
   

  	
                                

  	
   

  	
   

  	
   

  	
   

  

 

USA Patriot Act Notice.
Federal law requires all financial institutions to obtain, verify and record
information that identifies each person who opens an account or obtains a loan.
The Bank will ask for the Borrower’s legal name, address, tax ID number or
social security number and other identifying information. The Bank may also ask
for additional information or documentation or take other actions reasonably
necessary to verify the identity of the Borrower, guarantors or other related
persons.

 

 11Exhibit 10.1

Confidential
materials omitted and filed separately with the Securities and Exchange

Commission.  Asterisks denote such
omission.

AGREEMENT REGARDING

VALIDATION CAMPAIGN

This AGREEMENT REGARDING
VALIDATION CAMPAIGN (“Agreement”), dated effective as of July 1, 2006 (the “Effective
Date”), is entered into by and between Genzyme Corporation, a
Massachusetts corporation with its principal office at 500 Kendall Street,
Cambridge, MA  02142 (“Genzyme”), Dyax
Corp., a Delaware corporation with its principal office at 300 Technology
Square, Cambridge, Massachusetts 02139 (“Dyax”) and Dyax-Genzyme LLC, a
Delaware limited liability company with its principal office at 300 Technology
Square, Cambridge, Massachusetts 02139 (“Dyax-Genzyme LLC”).

WHEREAS, Dyax and Genzyme are parties to an Amended
and Restated Collaboration Agreement, dated as of May 31, 2002,  as amended to date (the “Collaboration
Agreement”);

WHEREAS, under the terms of the Collaboration
Agreement, Dyax and Genzyme are jointly developing a 58-amino acid polypeptide
human plasma kallikrein inhibitor, known as DX-88;

WHEREAS, to manage the development of DX-88, Dyax and
Genzyme formed Dyax-Genzyme LLC as a jointly owned limited liability company;

WHEREAS, under the terms of the Collaboration Agreement,
Dyax and Genzyme are responsible for all costs associated with the development
of DX-88 in accordance with Section 4.3.2 of the Collaboration Agreement;

WHEREAS, as authorized by Dyax-Genzyme LLC under the
terms of the Collaboration Agreement, Dyax has entered into an agreement, dated
March 15, 2006, with Avecia Limited (the “Validation Campaign Agreement”, under
which Avecia will (i) carry out the manufacture of one development batch and
three sequential batches of DX-88 drug substance at 5,000 liter scale, and (ii)
provide Dyax with additional support necessary in connection with the filing
for BLA / MAA approval for DX-88;

WHEREAS, the expenses incurred by Dyax in connection
with the activities conducted under the Validation Campaign Agreement would be
considered Program Costs (as defined under the Collaboration Agreement),
subject to reimbursement as provided under the terms of the Collaboration
Agreement;

WHEREAS, Dyax wishes to own and control, independent
of its obligations under the Collaboration Agreement, the DX-88 drug substance
manufactured by Avecia under the Validation Campaign Agreement; and

WHEREAS, Genzyme is willing to allow Dyax to own and
control such DX-88 drug substance, subject to the terms and conditions set
forth herein.

NOW, THEREFORE, in consideration of the promises and
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Genzyme and Dyax
hereby agree as follows:

1.             Defined Terms.   All capitalized terms not defined in this
agreement shall have the meaning given to them in the Collaboration Agreement.

 

 

2.             Assumption of
Manufacturing Expenses.   Attached as Exhibit A hereto is the currently approved
budget highlighting the expenses that are scheduled to be incurred in
connection with the activities conducted under the Validation Campaign
Agreement.   In consideration for rights
granted to Dyax under Section 3 below to own and control the DX-88 drug
substance manufactured by Avecia under the Validation Campaign Agreement (the “DX-88
API”), Dyax hereby agrees that it will assume full responsibility for all
expenses incurred by Dyax in connection with the production of DX-88 API under
the Validation Campaign Agreement, including without limitation activities
through other third party contractors (e.g. Formatech), up to *****************
(the “Manufacturing Expense Limit”).  For
the avoidance of doubt, the parties acknowledge and agree that (i) Dyax shall
not be able to seek reimbursement, under the Collaboration Agreement or
otherwise, for any costs incurred for the production of DX-88 API under the
Validation Campaign Agreement until the Manufacturing Expense Limit has been
achieved, and (ii) upon achievement of the Manufacturing Expense Limit, all remaining
expenses incurred in connection with the production of DX-88 API  under the Validation Campaign Agreement will
be considered Program Costs subject to reimbursement in accordance with Section
4.3.3 of the Collaboration Agreement.

3.             Ownership of Drug
Product.   Dyax
shall own and control, independent of any obligations under the Collaboration
Agreement, any and all of the DX-88 API until the achievement of the
Manufacturing Expense Limit.  Thereafter,
the DX-88 API shall be owned and controlled by each of Dyax and Dyax-Genzyme
LLC as calculated in accordance with the following formulas:

DX-88 API owned and controlled by Dyax:                                                    B/A
* D

DX-88 API owned and controlled by Dyax-Genzyme LLC:                           C/A * D

	
  

  	
  Where:

  	
  A

  	
   

  	
  =

  	
   

  	
  Total manufacturing costs incurred in the production
  of DX-88 API under the Validation Campaign Agreement;

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B

  	
   

  	
  =

  	
   

  	
  Total manufacturing costs incurred in the production
  of DX-88 API under the Validation Campaign Agreement paid by Dyax, which
  shall be the Manufacturing Expense Limit of *****************;

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C

  	
   

  	
  =

  	
   

  	
  Total manufacturing costs incurred in the production
  of DX-88 API under the Validation Campaign Agreement paid by Dyax-Genzyme LLC
  (computed as A-B); and

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  D

  	
   

  	
  =

  	
   

  	
  Total Mgs of DX-88 API manufactured by Avecia.

  

 

For
the avoidance of
doubt, the parties acknowledge and agree that such DX-88 API owned and
controlled by Dyax may be (i) used by Dyax in the development or
commercialization of DX-88 as a Surgical Product or any other indication now or
in the future that is owned by Dyax independent of its collaboration with
Genzyme, or (ii) supplied to Dyax-Genzyme LLC, on the terms set forth in
Section 4 below, for use in the development or commercialization of DX-88 as a
Collaboration Product. 

Furthermore,
the parties acknowledge and agree that any and all DX-88 API that is necessary
to be used for validation, stability, and other analytical studies that are
conducted on behalf of Dyax-Genzyme LLC in connection with 

 

Confidential materials omitted
and filed separately with the Securities and Exchange

Commission.  Asterisks denote such
omission.

 2
 

 

 

the Validation Campaign
Agreement or for marketing approval of DX-88 will be taken from the DX-88 API
owned and controlled by Dyax-Genzyme LLC.

4.             Sale of DX-88
API to Dyax-Genzyme LLC.  Dyax-Genzyme LLC may from time
to time request, at its sole option, that Dyax sell the DX-88 API to
Dyax-Genzyme LLC for use in the development or commercialization of DX-88 as a
Collaboration Product.  Dyax may, at its
option, accept or reject any such request. 
If such request is accepted by Dyax, the DX-88 API will be supplied to
Dyax-Genzyme LLC at a price per mg calculated as follows:

	
  

  	
  Price per mg

  	
   

  	
   

  	
  =

  	
   

  	
  A/B      *      ( (1+C)   *   D/12 )

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  

  	
  where:

  	
  A

  	
   

  	
  =

  	
   

  	
  all expenses incurred in
  connection with the activities conducted under the Validation Campaign
  Agreement that were assumed by Dyax under Section 2 above, up to the
  Manufacturing Expense Limit;

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  B

  	
   

  	
  =

  	
   

  	
  the total number of mgs of
  DX-88 API manufactured under the Validation Campaign Agreement, and owned and
  controlled by Dyax;

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  C

  	
   

  	
  =

  	
   

  	
  Dyax’s cost of financing,
  determined for the purposes of this Agreement to be *****************,
  compounded monthly; and

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  D

  	
   

  	
  =

  	
   

  	
  the number of complete
  calendar months that have occurred between the date of the request for DX-88
  API by Dyax-Genzyme LLC and December 31, 2006.

  

 

Furthermore, if and when DX-88 receives marketing approval in the United
States or the European Union, Dyax-Genzyme LLC shall be obligated to request
that Dyax supply DX-88 API to Dyax-Genzyme LLC in an amount determined solely
by Dyax-Genzyme LLC at the price set forth above and Dyax shall accept such
request.  Such obligation is intended to
mean that following marketing approval in the United States or the European
Union, if and when DX-88 drug substance is needed for commercial sale or
otherwise, Dyax-Genzyme LLC must request, in preference to all available
sources other than quantities owned and controlled by Dyax-Genzyme LLC, that
such DX-88 drug substance be supplied by Dyax at the price set forth above.

For the avoidance of doubt, drug substance supplied by Dyax to
Dyax-Genzyme LLC will only be DX-88 API and Dyax-Genzyme LLC will always take
title to such DX-88 API prior to any fill/finish activities.  All fill/finish activities and expenses will
be the sole responsibility of Dyax-Genzyme LLC.

 

Confidential
materials omitted and filed separately with the Securities and Exchange

Commission.  Asterisks denote such
omission.

 3
 

 

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed by their respective duly authorized representatives,
under seal, as of the Effective Date hereof.

	
  GENZYME CORPORATION

  	
   

  	
   

  	
  DYAX CORP.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Georges Gemayel

  	
   

  	
   

  	
  By:

  	
  /s/ Thomas R. Beck

  
	
  Name:

  	
  Georges Gemayel

  	
   

  	
   

  	
  Name:

  	
  Thomas R. Beck

  
	
  Title:

  	
  Executive Vice President

  	
   

  	
   

  	
  Title:

  	
  President and Chief Operating Officer

  

 

DYAX-GENZYME LLC

DYAX CORP., MEMBER:

	
  By:

  	
  /s/ Thomas R. Beck

  	
   

  
	
  Name:

  	
  Thomas R. Beck

  	
   

  
	
  Title:

  	
  President and Chief Operating Officer

  	
   

  
	
   

  	
   

  	
   

  
	
  GENZYME CORPORATION, MEMBER:

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Georges Gemayel

  	
   

  
	
  Name:

  	
  Georges Gemayel

  	
   

  
	
  Title:

  	
  Executive Vice President

  	
   

  

 

Confidential
materials omitted and filed separately with the Securities and Exchange

Commission.  Asterisks denote such
omission.

 4

 

 

EXHIBIT A

TO

AGREEMENT REGARDING

VALIDATION
CAMPAIGN

VALIDATION CAMPAIGN BUDGETED EXPENSES

*****************

 

 

 

 

Confidential
materials omitted and filed separately with the Securities and Exchange

Commission.  Asterisks denote such
omission.

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