Fund 1 Investments Updates Citi Trends Stake

TL;DR

Fund 1 Investments filed an amendment on 3/1/24 for Citi Trends (CTRN) - ownership update.

AI Summary

Fund 1 Investments, LLC, through an amendment filed on March 1, 2024, has updated its Schedule 13D filing concerning Citi Trends, Inc. The filing indicates a change in beneficial ownership as of February 28, 2024. Fund 1 Investments, LLC is based in Rincon, PR.

Why It Matters

This amendment to a Schedule 13D filing signals a potential shift in significant ownership or strategy by Fund 1 Investments, LLC regarding Citi Trends, Inc.

Risk Assessment

Risk Level: medium — Schedule 13D filings often indicate activist investors or significant stake changes, which can lead to volatility.

Key Players & Entities

• Fund 1 Investments, LLC (company) — Filing entity
• Citi Trends, Inc. (company) — Subject company
• Christopher P. Davis (person) — Authorized contact for filing
• Kleinberg, Kaplan, Wolff & Cohen, P.C. (company) — Legal counsel for filing

FAQ

Key Financial Figures

• $0.01 — ame of Issuer) Common Stock, par value $0.01 (Title of Class of Securities) 17306X
• $31,134,415.93 — n market for aggregate consideration of $31,134,415.93 using working capital of the Funds. It
• $150,000 — ation Agreement, which shall not exceed $150,000. Concurrently with the execution of th

Filing Documents

• cititrends13da3-022824.htm (SC 13D/A) — 39KB
• 0001013594-24-000250.txt ( ) — 41KB

Source and Amount of Funds or Other Consideration

Item 3. Source and Amount of Funds or Other Consideration.

of the Schedule 13D is hereby amended and restated in its entirety as follows

Item 3 of the Schedule 13D is hereby amended and restated in its entirety as follows: The shares of Common Stock of the Issuer reported herein as being beneficially owned by the Reporting Person was purchased in the open market for aggregate consideration of $31,134,415.93 using working capital of the Funds.

Purpose of Transaction

Item 4. Purpose of Transaction.

of the Schedule 13D is hereby amended to add the following

Item 4 of the Schedule 13D is hereby amended to add the following: On February 28, 2024 (the "Effective Date"), the Issuer and the Reporting Person entered into a cooperation agreement (the "Cooperation Agreement"). Pursuant to the Cooperation Agreement, the Issuer has agreed to (i) appoint each of David Heath, Charles Liu and Michael Kvitko as an observer to the Issuer's Board of Directors (the "Board") to serve as such until the conclusion of the Issuer's 2024 annual meeting of stockholders (the "2024 Annual Meeting"); (ii) nominate each of Messrs. Heath, Liu and Kvitko (following such nominations, collectively, the "New Directors") for election to the Board at the 2024 Annual Meeting; and (iii) accept the retirement, effective as of the conclusion of the 2024 Annual Meeting, of three incumbent directors. Following the successful election of the New Directors to the Board at the 2024 Annual Meeting, the Board shall appoint Mr. Heath to the Compensation Committee of the Board and the Nominating and Corporate Governance Committee of the Board and Messrs. Liu and Kvitko to the Finance Committee of the Board. From the Effective Date to the Termination Date (as defined below) (the "Standstill Period"), if the Reporting Person satisfies the Minimum Ownership Threshold (as defined in the Cooperation Agreement), the Reporting Person will have replacement rights with respect to the New Directors, which will be subject to the Board's approval (not to be unreasonably withheld, conditioned or delayed). During the Standstill Period, the Reporting Person has agreed to vote all Voting Securities (as defined in the Cooperation Agreement) beneficially owned by it or its affiliates at the 2024 Annual Meeting in accordance with the Board's recommendations with respect to any and all proposals, except that the Reporting Person (i) shall be permitted to vote in accordance with the recommendation of Institutional Shareholder Services Inc. ("ISS") and Glass, Lewis & Co. LLC ("Glass L

Interest in Securities of the Issuer

Item 5. Interest in Securities of the Issuer.

of the Schedule 13D is hereby amended and restated in its entirety as follows

Item 5 of the Schedule 13D is hereby amended and restated in its entirety as follows: (a) The aggregate percentage of shares of Common Stock reported owned by the Reporting Person is based upon 8,544,345 shares of Common Stock outstanding, as of November 22, 2023, which is the total number of shares of Common Stock outstanding as reported in the Issuer's Quarterly Report on Form 10Q filed with the Securities and Exchange Commission on December 6, 2023. As of the close of business on the date hereof, the Reporting Person beneficially owned 1,439,146 shares of Common Stock, constituting approximately 16.8% of all of the outstanding shares of Common Stock. (b) The Reporting Person has sole power (i) to vote or direct the vote of, and (ii) to dispose or direct the disposition of, the 1,439,146 shares of Common Stock held by the Funds. (c) During the past sixty (60) days, the Reporting Person has not entered into any transactions in the Common Stock except as set forth on Schedule 1 hereto. (d) Pleasant Lake Onshore Feeder Fund, LP has the right to receive or the power to direct the receipt of distributions or dividends from, or the proceeds from the transfer of, the reported securities. (e) Not Applicable.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

of the Schedule 13D

Item 6 of the Schedule 13D is hereby amended to add the following : On February 28, 2024, the Reporting Person and the Issuer entered into the Cooperation Agreement as defined and described in Item 4 above and attached as Exhibit 99.1 hereto.

Material to be Filed as Exhibits

Item 7. Material to be Filed as Exhibits.

is hereby amended to add the following exhibit

Item 7 is hereby amended to add the following exhibit: 99.1 Cooperation Agreement, dated February 28, 2024 (incorporated by reference to Ex. 10.1 to the Issuer's Current Report on Form 8-K, filed with the Securities and Exchange Commission on February 29, 2024). SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, each of the undersigned certifies that the information set forth in the Statement is true, complete and correct. Dated: March 1 , 2024 FUND 1 INVESTMENT, LLC By: /s/ Benjamin C. Cable Benjamin C. Cable Chief Operating Officer SCHEDULE 1 Transactions in the Common Stock of the Issuer by Reporting Person During the Past 60 Days: Date Buy/Sell Security Approximate Price Per Share or Option, as Applicable 1 Number of Shares Bought/(Sold) or Underlying Options 02/29/2024 BUY Common Stock 30.5085 70,804 03/01/2024 BUY Common Stock 31.3311 39,000 1 Excluding any brokerage fees.

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View this SC 13D/A filing on SEC EDGAR