Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of June 5, 2002 by and between Archibald Candy
Corporation, an Illinois corporation (the "Company"), and Ted A. Shepherd (the "Executive").

RECITALS:

A.    Prior
to the date hereof, the Company has employed the Executive; during the course of such employment and during the course of the Executive's continued employment
pursuant to the terms of this Agreement, the Executive has participated in and will continue to participate in the development of, and has been and will continue to be privy to, trade secrets and
confidential information of the Company and its affiliates, including without limitation, their customer lists, strategic business plans, pricing and billing practices, relationships with vendors and
know-how involved in the operation of their business activities (collectively, the "Confidential Information"); and

B.    The
Company desires to obtain the continued services of the Executive and to protect the Confidential Information and goodwill of the Company and its affiliates.

NOW,
THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:

1.Employment and Duties.



2.Term of Employment.The term of this Agreement (the "Term")
shall run for one year from the date hereof (the "Commencement Date"), or until the Executive's employment is terminated in accordance with
Section 5 hereof, provided that the Term shall renew automatically at the expiration thereof for successive one year renewals unless the Executive or the Company provides at least
90 days' prior notice of his or its election not to renew the Term.

3.Compensation and Benefits.During the Term, the Company shall pay to the Executive, and the Executive shall
accept from the Company, as full compensation for the Executive's services hereunder, compensation as follows:



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4.Non-Compete, Non-Solicitation.



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5.Termination.This Agreement shall terminate in accordance with the provisions of this Section 5.



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6.Compensation Upon Termination.



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7.Confidential Information.The Executive acknowledges that all Confidential Information is the property of the
Company and its Subsidiaries. Therefore, the Executive agrees that he shall not disclose to any unauthorized person or use for his own purposes any Confidential Information without the prior written
consent of the Board, unless and to the extent that the Confidential Information becomes generally known to and available for use by the public other than as a result of the Executive's acts or
omissions or as requested or required by law or court order (provided that the Executive shall notify the Company promptly of such request or requirement so that the Company may seek an appropriate
protective order). The Executive shall deliver to the Company at the end of the Term, or at any other time the Company may request, all memoranda, notes, plans, records, reports, computer tapes,
printouts and software and other documents and data (and copies thereof) embodying or relating to the Confidential Information, Work Product (as defined below) or the business of the Company and its
Subsidiaries which he may then possess or have under his control.

8.Inventions and Patents.The Executive acknowledges that all inventions, innovations, improvements,
developments, methods, designs, analyses, drawings, reports and all similar or related information (whether or not patentable) which relate to the Company or any of its Subsidiaries' actual business,
research and development or existing or future products or services and which are conceived, developed or made by the Executive while employed by the Company and its Subsidiaries
("Work Product") belong to the Company and its Subsidiaries. The Executive shall promptly disclose such Work Product to the Board and, at the Company's
expense, perform all actions reasonably requested by the Board (whether during or after the Term) to establish and confirm such ownership (including, without limitation, assignments, consents, powers
of attorney and other instruments).

9.Successors and Assigns.This Agreement shall inure to the benefit and be binding upon the parties hereto and
their respective legal representatives, heirs, or successors and permitted assigns;provided,however,
that the Executive may not sell, assign, pledge, hypothecate, or otherwise transfer this Agreement or any part hereof without the prior written consent of the Company. The Company will use all
commercially reasonable efforts to require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or the assets of
the Company to assume expressly and to agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.

10.Indemnification.The Company agrees to indemnify and hold the Executive harmless against and from any and
all loss, cost, liability or expense that may be imposed upon or reasonably incurred by him in connection with or
resulting from any claim, action, suit or proceeding to which he may be a party or in which he may be involved by reason of any action taken or failure to act in his capacity as an officer of the
Company during the Term. The foregoing right of indemnification shall not be exclusive of any other right to which the Executive may be entitled to as a matter of law or otherwise, or any power that
the Company may have to indemnify him or hold him harmless, but shall be subject to any applicable restrictions imposed by the by-laws of the Company from time to time and any applicable
law and shall not apply in respect of any loss, cost, liability or expense resulting from or incurred in connection with fraud or willful misconduct of the Executive.

11.GOVERNING LAW AND FORUM.THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED UNDER THE LAWS
OF THE STATE OF ILLINOIS, WITHOUT REGARD TO ITS CONFLICT OF LAWS PROVISIONS. THE PARTIES HERETO AGREE THAT ANY DISPUTE CONCERNING OR ARISING FROM THIS AGREEMENT SHALL BE LITIGATED IN A FEDERAL OR
STATE COURT LOCATED IN COOK COUNTY, ILLINOIS AND THE PARTIES HERETO AGREE TO SUBMIT TO PERSONAL JURISDICTION IN ANY SUCH COURT.

12.Interpretation.This Agreement is the result of negotiations between the parties and accordingly, shall not
be construed for or against either party regardless of which party drafted this Agreement or any portion thereof.

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13.Notices.All notices required or permitted to be given pursuant to this Agreement shall be in writing and
shall be deemed to have been delivered upon the earlier of personal delivery, or upon first attempted delivery by the United Postal Service or the overnight carrier if sent by certified mail, return
receipt requested, postage prepaid or by recognized overnight carrier addressed: (i) in the case of the Company, at its principal office and (ii) in the case of the Executive, at the
last known residence as shown on the Company's records.

14.Waiver.A delay or failure by either party to require strict performance by the other party of any
undertakings or agreements contained in this Agreement will not waive, affect or diminish any right of such party thereafter to demand strict compliance and performance therewith. Any waiver by either
party of any default by the other party under this Agreement will not waive or affect any other such default, whether such default is prior or subsequent thereto and whether of the same or a different
type.

15.Severability.In the event that any provision of this Agreement shall be held by a court of competent
jurisdiction to be invalid, illegal or unenforceable, it shall not affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein, unless to do so would cause this Agreement to fail of its essential purpose.

16.Entire Agreement.This Agreement constitutes the entire understanding and agreement between the Company and
the Executive with respect to the terms and conditions of the Executive's employment during the Term and supersedes all previous agreements and arrangements (if any), oral or written, relating to the
employment of the Executive by the Company (which shall be deemed to have been terminated by mutual consent). There are no other agreements, conditions, or representations, oral or written, express or
implied with regard thereto.

17.Amendment of Agreement.This Agreement may be modified, amended or rescinded only by means of a writing duly
executed by the Company and the Executive.

18.Survivorship.The respective rights and obligations of the parties hereunder will survive any termination of
this Agreement to the extent necessary to the intended preservation of such rights and obligations.

19.Counterparts.This Agreement may be executed simultaneously in counterparts, each of which shall be deemed
an original but which taken together shall constitute a single agreement between the parties.

20.Headings.The Section headings herein are inserted for convenience of reference only, do not constitute a
part of this Agreement, and shall not be deemed to limit or affect the meaning or interpretation of any of the provisions herein.

21.Termination.Any employment and non-compete agreement previously entered into by the Executive
and any Archibald Entity shall automatically terminate and be null and void and of no further force and affect from and after the effectiveness of this Agreement.

22.Early Termination.It is agreed and understood that, in the event the Company has not filed a chapter 11
petition pursuant to the United States Bankruptcy Code by July 5, 2002, this Agreement shall be null and void and the parties shall have no further obligations to one another hereunder.

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IN
WITNESS WHEREOF, the parties have duly executed this Employment and Non-Compete Agreement as of the date first above written.

| |  | ARCHIBALD CANDY CORPORATION      
| |  | ---------------------------------
| |  | By:                              
| |  | Name:                            
| |  | Title:                           
| |  | /s/TED A. SHEPHERDTED A. SHEPHERD

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