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                                                                   EXHIBIT 10.19


Michael J. Madden
10 Finn Court
Mahwah, New Jersey 07430

Re:      SEVERANCE AGREEMENT

Dear Michael:

Trans World Entertainment Corporation, a New York Corporation, and its wholly
owned subsidiary, Record Town, Inc. (collectively, the "Company"), considers the
establishment and maintenance of a sound and vital management to be essential to
protecting and enhancing the best interests of the Company and its shareholders.
In order to induce you to join the Company, this Agreement sets forth the
severance benefits which the Company agrees will be provided to you in the event
your employment with the company is terminated without "Cause," as further
described below.

1.   TERM OF AGREEMENT. This Agreement shall commence on the date hereof and
     shall continue in effect until May 1, 2000 (the "Term"); provided, however,
     that commencing of May 1, 2000 and each May thereafter, the term of this
     Agreement shall automatically be extended for one additional year.
     Notwithstanding anything in this Section 1 to the contrary, this Agreement
     shall terminate if you otherwise separate your employment from the Company.

2.   SEPARATION FOR DISABILITY OR FOR CAUSE.

     a)  You shall be entitled to the benefits provided in Section 3 if, during
         the Term of this Agreement, your employment with the Company is ever
         terminated for any reason other than Cause (defined below), unless such
         termination is for Disability (defined below.)

     b)  DISABILITY. Termination by the Company of your employment based on
         "Disability" shall mean termination because of your absence from your
         duties with the Company on a full time basis for sixty (60) consecutive
         days as a result of your incapacity due to physical or mental illness,
         unless within thirty (30) days after notice of termination is given to
         you following such absence you shall have returned to the full-time
         performance of your duties. This provision shall not apply to
         accidents.

     c)  CAUSE. Termination by the Company of your employment for "Cause" shall
         mean termination for any of the following reasons: (i) the willful and
         continued failure by you to perform substantially your duties with the
         Company (other than any such failure resulting from your incapacity due
         to physical or mental illness) after demand for substantial performance
         is delivered to you by the Chairman of the Board or the CEO of the
         Company, which demand specifically identifies the manner in which such
         executive believes that you have not substantially performed your
         duties; (ii) the willful engaging by you in illegal conduct that
         materially and demonstrably damages the Company's business or
         reputation; (iii) the commission of any act which injures, or in the
         reasonable judgment of the Board could reasonably be expected to
         injure, materially the reputation, business or business relationships
         of the Company, including, without limitation, any breach of written
         policies of the Company with respect to trading in securities; or (iv)
         any conduct in the course of your employment that constitutes, in the
         Company's reasonable judgement, gross negligence, fraud, embezzlement
         or any acts of moral turpitude that result or are intended to result,
         directly or indirectly, to your personal enrichment at the Company's
         expense. For purposes of this Section 2(c), no act or failure to act on
         your part shall be considered "willful" unless done, or omitted to be
         done, by you in bad faith and without reasonable belief that your
         action or omission was in, or not opposed to, the best interests of the
         Company. Any act, or failure to act, based upon authority given
         pursuant to a resolution duly adopted by the Board or based upon the
         advise of counsel for the company shall be conclusively presumed to be
         done, or omitted to be done, by you in good faith and in the best
         interests of the corporation.

     d)  EMPLOYMENT AT WILL. The Company or you may separate your employment at
         any time, subject to the Company's covenant to provide the benefits
         specified in accordance with the terms of this Agreement.

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3.   COMPENSATION UPON TERMINATION OR DURING DISABILITY:  OTHER AGREEMENTS.

     a)  During any period that you fail to perform your duties as a result of
         incapacity due to physical or mental illness, you shall continue to
         receive your salary at the rate then in effect and any benefits or
         awards under any benefit plans shall continue to accrue during such
         period, which period shall be at least 90 days, until your employment
         is terminated without cause. Thereafter, your benefits shall be
         determined in accordance with any applicable benefit plans then in
         effect.

     b)  If your employment shall be terminated, other than for Cause, by the
         Company, then the Company shall pay you your base salary for 24 months
         at the rate in effect just prior to the time a notice of termination is
         given, plus (i) the lesser of (x) your bonus paid by the Company for
         the last fiscal year (or guaranteed to be paid in the case of fiscal
         1999) and (y) the bonus you would have earned for the current fiscal
         year (not to exceed the bonus payable based upon achieving target) and
         (ii) any benefits (including health, disability and 401(k) or awards
         including both cash, bonus and stock components) which, pursuant to the
         terms of any applicable plans, have been earned or become payable, but
         which have not yet been paid to you (it being understood that options
         and restricted stock awards that have not vested as of the date of
         termination shall terminate upon such date of termination). Thereafter,
         the Company shall have no further obligations to you under this
         Agreement; provided that (i) your benefits under the Company's
         Supplemental Executive Retirement Plan shall continue to accrue for a
         period of two years from the date of termination or your subsequent
         employment by a third party, whichever occurs sooner, at the rate
         accrued in the last full fiscal year prior to the notice of
         termination, and (ii) the Company shall continue your existing life
         insurance and health benefits for a period of two years from the date
         of termination or your subsequent employment by a third party,
         whichever occurs sooner.

     c)  To the extent that you shall receive cash compensation that is subject
         to federal income taxation in respect of other employment or a
         consulting position with another organization, and that consideration
         is payable to you solely in respect of the remainder of the Term of
         this Agreement as in effect immediately prior to such termination, or a
         portion thereof, the payments to be made by the Company under this
         Section 3, shall be proportionately reduced.

     d)  To the extent that following a Change of Control (as such term is
         defined in the Company's 1998 Stock Option Plan as in effect on the
         date hereof) your responsibilities within the Company are materially
         diminished, you shall have the right to deem your employment to have
         been terminated, other than for Cause, by the Company by written notice
         to the Company within 30 days of such diminution of such
         responsibility.


4.   TAXES. All payments to be made to you under this Agreement will be subject
     to required withholding of federal, state, and local income and employment
     taxes.

5.   SURVIVAL. The respective obligations of, and benefits afforded to, the
     Company or you as provided in this Agreement shall survive any expiration
     or termination of this Agreement.

6.   NOTICES. For the purposes of this Agreement, notices and all other
     communications provided for in the Agreement shall be in writing and shall
     be deemed to have been duly given when delivered or mailed by United Sates
     registered mail, return receipt requested, postage prepaid and addressed,
     in the case of the Company, to the address set forth on the first page of
     this Agreement, or, in the case of the undersigned employee, to the address
     set forth below his signature, provided that all notices to the Company
     shall be directed to the attention of the Chairman of the company, with a
     copy to the Secretary of the Company, or to such other address as either
     party may have furnished to the other in writing in accordance herewith,
     except that notice of change of address shall be effective only upon
     receipt.

7.   MODIFICATION WAIVER: GOVERNING LAW. No provision of this Agreement may be
     modified, waived or discharged unless such modification, waiver or
     discharge is agreed to in writing signed by you and the Chairman of the
     Board or the CEO of the Company. No waiver by either party hereto at any
     time of any breach by the other party hereto of, or of compliance with, any
     condition or provision of this Agreement to be performed by such other
     party shall be deemed a waiver of similar or dissimilar provisions or
     conditions at the same or at any prior or subsequent time. No agreements or
     representations, oral or other wise, expressed or implied, with respect to
     the subject matter hereof have been made by either party, which are not
     expressly set forth in this Agreement.


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     The validity, interpretation, construction and performance of this
     Agreement shall be governed by the laws of the State of New York without
     reference to its principles of conflict of laws.

8.   ARBITRATION. Any dispute or controversy arising under or in connection with
     this Agreement shall be settled exclusively by arbitration in Albany, New
     York by three arbitrators in accordance with the rules of the American
     Arbitration Association then in effect. Judgment may be entered on the
     arbitrators' award in any court having jurisdiction. The Company shall bear
     all costs and expenses arising in connection with any arbitration
     proceeding pursuant to this Section 8.

9.   EMPLOYEE'S CONTINUING COVENANTS.

     a)  For a period of 24 months after your employment is separated from the
         Company for whatever reason, whether or not it is for Cause, you
         covenant and agree not to compete with the Company, whether directly or
         indirectly, alone or as an employee, independent contractor of any
         type, partner, substantial shareholder (5% or greater) or holder of an
         option or right to become a substantial shareholder, in any music or
         video business in the United States. If any of the restrictions on
         post-employment competitive activity contained in this Section 9 are
         held by a court of competent jurisdiction to be excessively broad as to
         duration, geographical scope, activity or subject such restrictions
         shall be construed to be enforceable to the extent compatible with
         applicable law as it shall then exist, it being understood that by the
         execution of this Agreement the parties hereto regard such restrictions
         as reasonable and compatible with their respective rights and
         obligations.

     b)  In consideration for the Company's agreement hereunder, you agree that
         subsequent to your period of employment with the Company, you will not
         at any time communicate or disclose to any unauthorized person, without
         the written consent of the Company, business information, trade
         secrets, sales data or any proprietary processes of the Company or any
         subsidiary or other confidential information concerning their business
         affairs, products, suppliers, or customers, unless otherwise required
         by law.

If this letter correctly sets forth our agreement on the subject matter hereof,
kindly sign and return it to the Company, which will then constitute our
agreement.


Sincerely,

TRANS WORLD ENTERTAINMENT CORP.
RECORD TOWN, INC.


BY:
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  Robert J. Higgins
  Chairman & CEO





ACKNOWLEDGED AND AGREED TO:


By:
    ______________________________
 Michael J. Madden



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