Exhibit 10.1


 


EXECUTION VERSION


 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT
(the “Agreement”) is made and entered into as of the 27th day of August, 2014, by and between Trans World Entertainment
Corporation, a New York corporation (the “Employer”), and Michael Feurer (the “Executive”), to
become effective on the date the Executive commences employment with the Employer, which is contemplated to be on or about October 13,
2014 (the “Effective Date”).


 


RECITALS


 


A. The Employer desires that the Executive provide services for the benefit of the Employer and its affiliates and the Executive
desires to accept such employment with the Employer.


 


B. The Employer and the Executive acknowledge that the Executive will be a member of the senior management team of the Employer
and, as such, will participate in implementing the Employer’s business plan.


 


C. In the course of employment with the Employer, the Executive will have access to certain confidential information that relates
to or will relate to the business of the Employer and its affiliates.


 


D. The Employer desires that any such information not be disclosed to other parties or otherwise used for unauthorized purposes.


 


NOW, THEREFORE, in
consideration of the above premises and the following mutual covenants and conditions, the parties agree as follows:


 


1. Employment. The Employer shall employ the Executive as its Chief Executive Officer (“CEO”), and
the Executive hereby accepts such employment on the following terms and conditions. The Executive understands and agrees that he
is an at-will employee, and the Executive and the Employer can, and shall have the right to, terminate the employment relationship
at any time for any or no reason, with or without cause, subject to the payment and notice provisions contained in Paragraph 6
of this Agreement. Nothing contained in this Agreement or any other agreement shall alter the at-will relationship. In the event
that the Executive ceases to be employed by the Employer for any reason, the Executive shall tender his resignation from all positions
he holds with the Employer, effective on the date his employment is terminated.


 


2. Duties/Loyalty. The Executive shall work for the Employer in a full-time capacity. The Executive shall,
during the term of his employment, have the duties, responsibilities, powers, and authority customarily associated with the position
of CEO. The Executive shall report to, and follow the direction of, the Employer’s Board of Directors (the “Board”).
In addition to the foregoing, the Executive also shall perform such other services and



    	 



    	



    


duties as may be assigned to him from time to time by the Board. The Executive shall diligently, competently, and faithfully perform all
duties, and shall devote his entire business time, energy, attention, and skill to the performance of duties for the Employer or
its affiliates and will use his best efforts to promote the interests of the Employer. It shall not be considered a violation of
the foregoing for the Executive to serve on industry, civic, religious or charitable boards or committees, so long as such service
does not individually or in the aggregate significantly interfere with the performance of the Executive’s responsibilities as an
employee of the Employer in accordance with this Agreement.


 


3. Compensation.


 


A. The Employer shall pay the Executive an annual base salary (the “Base Salary”) of Six Hundred Thirty Five
Thousand Dollars ($635,000), earned and payable in substantially equal installments in accordance with the Employer’s payroll policy
from time to time in effect. The Executive’s Base Salary and other compensation shall be subject to any payroll or other deductions
as may be required to be made pursuant to law, government order, or by agreement with, or consent of, the Executive. Increases
(but not decreases) to the Base Salary, as adjusted, may be made following an annual salary review, the first of which shall take
place on or around February 1, 2016, and any increases in Base Salary shall be effective on the May 1 immediately following the
applicable review.


 


B. The Executive shall be entitled to a one-time signing bonus in an amount equal to One Hundred Thousand Dollars ($100,000)
(the “Signing Bonus”). The Signing Bonus shall be paid in a single lump sum on the Effective Date.


 


C. Beginning with the Employer’s fiscal year ending January 31, 2016, the Executive shall be eligible to participate
in the Employer’s annual earnings before interest, taxes, depreciation and amortization based bonus program for its executive
officers (the “Bonus Plan”) as approved by the Board. The Executive’s annual cash bonus under the Bonus
Plan will be targeted at one hundred percent (100%) of his Base Salary, with the opportunity to earn up to two hundred percent
(200%) of his Base Salary should the applicable bonus targets be exceeded and the ability to earn not less than fifty percent (50%)
of his Base Salary should at least ninety percent (90%) of the targets be attained, on such terms as established by the Compensation
Committee of the Board (the “Compensation Committee”). The bonus targets shall be set by the Compensation Committee,
after consultation with the Executive. The Bonus Plan shall also include an equity component, with a target award having a fair
value of not less than Four Hundred Thirty Thousand Dollars ($430,000) (or, a fair value of not less than Two Hundred Fifteen Thousand
Dollars ($215,000), if at least ninety percent (90%) of the targets are attained), with such fair value to be determined by application
of a Black-Scholes or similar valuation method as determined to be appropriate by the Compensation Committee. Fifty percent (50%)
of the equity portion of such bonus shall be awarded in the form of stock options and fifty percent (50%) shall be awarded in the
form of restricted stock units. For the Employer’s fiscal years beginning on and after February 1, 2016, the bonus targets
shall be determined by the Compensation Committee, after consultation with the Executive, in an amount that provides the Executive
with the opportunity to earn total compensation at or above a median total



    	2



    	



    


compensation benchmark for the Executive’s position as deemed appropriate by the Compensation Committee. Any bonuses earned
shall be paid in accordance with the terms of the applicable Bonus Plan.


 


D. During the term of his employment, the Employer shall:


 


(1) include the Executive in any life, disability, medical, dental or health insurance, 401(k) plans and other benefit plans
or programs which the Employer may provide the benefit of its executive employees generally, subject to the terms of such plans
or programs, excluding, however, any such benefit plans or programs which the Employer provides exclusively to Robert Higgins;


 


(2) provide the Executive with four (4) weeks paid vacation per annum, earned and accrued in accordance with the Employer’s
vacation policy from time to time in effect; and


 


(3) provide the Executive with the use of an automobile, subject to the terms of the Employer’s policies for use of Employer
provided automobiles as in effect from time to time.


 


E. The Executive
shall be entitled to the following equity awards, which awards shall be granted under and pursuant to the terms of the
Employer’s 2005 Long Term Incentive and Share Award Plan, as amended and restated, and as may be further amended from
time to time (the “Long Term Incentive Plan”):


 


(1) A stock
option (the “Option”) to purchase three hundred thousand (300,000) shares of the Employer’s common stock
shall be granted on the Effective Date. One hundred thousand (100,000) of the shares subject to the Option shall be fully vested
and exercisable on the Effective Date. The remaining two hundred thousand (200,000) shares shall vest in two (2) equal annual installments
on each of the first and second anniversaries of the Effective Date, subject to the Executive’s continued employment with
the Employer on each such anniversary date. The Option shall be granted at an exercise price equal to the fair market value of
a share of the Employer’s common stock as reported on The NASDAQ Stock Market as of the closing of such market on the Effective
Date. The definitive terms of the Option shall be set forth in an award agreement to be entered into between the Employer and the
Executive. 


 


(2) An award
of two hundred thousand (200,000) restricted stock units (the “RSUs”), which shall vest in four (4) equal annual installments
on each anniversary of the Effective Date, subject to the Executive’s continued employment with the Employer on each such
anniversary date. The definitive terms of the RSUs shall be set forth in an award agreement to be executed between the Employer
and the Executive.






    	3



    	



    

F. In connection with
the Executive’s relocation to the Albany, New York area, the Employer agrees to provide the Executive with the following
relocation benefits:


 


(1) Reimbursement
for one round-trip airline ticket, purchased in advance and at commercially reasonable rates for travel, from the Executive’s
current residence to Albany, New York. Such reimbursement shall be provided for one trip every other week during the period beginning
on the Effective Date and ending on the earlier of (i) the six (6) month anniversary of the Effective Date and (ii) the date the
Executive relocates his family to the Albany, New York area.


 


(2) Reimbursement
of the reasonable costs for up to three (3) house-hunting trips for the Executive and his spouse in the Albany, New York area.


 


(3) The
Employer shall engage and pay the cost of movers to pack and transport the Executive’s household goods from his current residence
to his new residence in the Albany, New York area.


 


(4) Reimbursement
of other reasonable relocation expenses in addition to those described above which are incurred by the Executive in order to relocate
himself and his family to the Albany, New York area, in an amount not to exceed One Hundred Thousand Dollars ($100,000). For purposes
of the foregoing reimbursements, if, following the date the Executive has both purchased a new home in the Albany, New York area,
and his family has relocated to the Albany, New York area, he has not yet completed the sale of his residence in Fargo, North Dakota,
the mortgage payments on the Executive’s home in Fargo, North Dakota shall be considered a relocation expense eligible to
be reimbursed by the Employer hereunder, up to the aggregate One Hundred Thousand Dollar ($100,000) limit for relocation expenses.
The amount to be reimbursed under this subparagraph 3F(4) shall be paid in a single lump sum, as soon as practicable after the
Executive has completed the sale of his current home and completed the purchase of a new home in the Albany, New York area, and
relocated his family to the Albany, New York area, and subject to the Executive submitting such documentation as reasonably requested
by the Employer in support of the additional expenses incurred. The payment shall further be grossed up to offset applicable federal
and state taxes.


 


(5) The
Employer shall provide the Executive with temporary housing for the period beginning on the Effective Date and ending on the earlier
of (i) the six month anniversary of the Effective Date and (ii) the date the Executive has relocated his family to the Albany,
New York area.


 


The Executive acknowledges
and agrees that if his employment terminates at any time prior to the second (2nd) anniversary of the Effective Date
pursuant to Paragraphs 5B (by the Employer for Cause) or 5E of this Agreement (by virtue of his voluntary resignation without




    	4



    	



    

Good
Reason), he shall be obligated to fully reimburse the Employer for the relocation expenses incurred or reimbursed by it under this
Paragraph 3F.


 

 G. The Employer and the Executive
each acknowledge that the compensation amounts paid under this Paragraph 3 are subject to any policy on the recovery of compensation
(i.e., a so-called “clawback policy”), as it exists now or as later adopted, and as thereafter amended from time to
time.


 


4.  Expenses. The Employer shall reimburse the Executive for all reasonable and approved business expenses, provided
the Executive submits paid receipts or other documentation acceptable to the Employer and as required by the Internal Revenue Service
to qualify as ordinary and necessary business expenses under the Internal Revenue Code of 1986, as amended (the “Code”).


 


5. Termination. The Executive’s services shall terminate upon the first to occur of the following events:


 


A. Upon the Executive’s date of death or the date the Executive is given written notice that he has been determined to be disabled
by the Employer. For purposes of this Agreement, the Executive shall be deemed to be disabled if the Executive, as a result of
illness or incapacity, shall be unable to perform substantially his required duties for a period of three (3) consecutive months
or for any aggregate period of six (6) months in any twelve (12) month period. A termination of the Executive’s employment by the
Employer for disability shall be communicated to the Executive by written notice and shall be effective on the tenth (10th) business
day after receipt of such notice by the Executive, unless the Executive returns to full-time performance of his duties before such
tenth (10th) business day.


 


B. On the date the Employer provides the Executive with written notice that he is being terminated for “Cause.” For
purposes of this Agreement, and as determined by the Employer in its sole discretion, the Executive shall be deemed terminated
for Cause if the Employer terminates the Executive after the Executive:


 


(1) shall have committed fraud, theft, misappropriation or embezzlement of the Employer’s funds;


 


(2) shall have been indicted for or entered a plea of guilty or nolo contendere to (i) any felony or any other crime involving
fraud or misrepresentation or (ii) any other crime (whether or not connected with his employment) the effect of which is likely
to adversely affect the Employer;


 


(3) shall have committed intentional acts that materially impair the goodwill or business of the Employer or cause material
damage to its property, goodwill, or business; or






    	5



    	



    

(4) shall have refused to, or willfully failed to, perform his material duties hereunder.


 


For purposes of determining
Cause, no act or failure to act shall be considered “willful” unless it is done, or omitted to be done, in bad faith
and without reasonable belief that the Executive was acting in the best interests of the Employer.


 


Any voluntary termination
by the Executive in anticipation of a termination for Cause under this subparagraph B, or a separation for other than Cause at
a time when grounds for termination for Cause exist, shall be deemed a termination for Cause.


 


C. On the date the Employer provides the Executive with written notice that his employment is being terminated for any reason,
other than a reason otherwise set forth in this Paragraph 5.


 


D. On the date the Executive terminates his employment under this Agreement for “Good Reason”. For purposes of
this Agreement, the term “Good Reason” shall mean the occurrence of any of the events or conditions described in the
following subparagraphs without the Executive’s express written consent:


 


(1) a material diminution of the Executive’s title, position, scope of authority or responsibilities (including reporting
responsibilities), the assignment to the Executive of any substantial duties or responsibilities which are inconsistent with such
title, position, authorities or responsibilities, or the Executive ceasing to be the CEO, except in connection with the termination
of the Executive’s employment for disability, Cause, as a result of the Executive’s death or by the Executive other
than for Good Reason;


 


(2) any reduction by the Employer in the Executive’s Base Salary or target bonus opportunity as provided for in this Agreement;


 


(3) the relocation of the Employer’s principal executive offices to a location outside a 50-mile radius of Albany, New
York or the Employer’s requiring the Executive to be based at any place other than Albany, New York, except for reasonably
required travel on the Employer’s business; or


 


(4) any material breach by the Employer of any material provision of this Agreement.


 


provided, however.
that it shall be a condition precedent to the Executive’s right to terminate employment for Good Reason that (i) he shall
first have given the Employer written notice that an event or condition constituting Good Reason has occurred within ninety (90)
days after such occurrence, (ii) a period of thirty (30) days from and after the giving of such written notice shall have elapsed
without the Employer having effectively cured or remedied such occurrence during such 30-day period, and (iii) the Executive shall
have tendered his resignation






    	6



    	



    

to be effective within not more than thirty (30) days following the end of such 30-day cure period.


 



E. On the date the Executive terminates his employment hereunder for any reason, other than for Good Reason, provided that
the Executive shall give the Employer not less than thirty (30) days written notice prior to such date of his intention to terminate
such employment. The foregoing notwithstanding, the Employer may, in its sole discretion, waive all or a portion of such thirty
(30) day notice requirement, in which event the Executive’s resignation shall become effective on such earlier date as designated
by the Employer.


 


6. Compensation Upon Termination.


 


A. If the Executive’s services are terminated pursuant to Paragraph 5, the Executive shall be entitled to his Base Salary
earned through his final date of active employment plus any accrued but unused vacation pay. The Executive also shall be entitled
to any benefits mandated under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) or required under the terms of
any death, insurance, or retirement plan, program, or agreement provided by the Employer and to which the Executive is a party
or in which the Executive is a participant.


 


B. In addition to the salary and benefits set forth in Paragraph 6A, if the Executive’s services are terminated pursuant to
Paragraph 5C or 5D (such a termination to be referred to herein as an “Involuntary Termination”) at any
time on or prior to the first anniversary of the Effective Date, the Executive shall be entitled to the continuation of his Base
Salary for a period of twenty-four (24) months (the “Severance Period”), payable in accordance with the Employer’s
payroll policy from time to time in effect, provided the Executive signs an agreement (the “Release”) acceptable
to the Employer that (i) waives any rights the Executive may otherwise have against the Employer, and (ii) releases the
Employer from actions, suits, claims, proceedings and demands related to the period of employment and/or the termination of employment.
If an Involuntary Termination occurs at any time after the first anniversary of the Effective Date, the Severance Period shall
be decreased from twenty-four (24) months to eighteen (18) months, and the severance payments shall otherwise be made subject to
the terms of this Paragraph 6B. The foregoing notwithstanding, if the Executive obtains a subsequent employment position or engagement
prior to the expiration of the Severance Period, any compensation or fees earned by the Executive during the Severance Period pursuant
to such subsequent employment or engagement shall reduce the Employer’s severance payment obligations hereunder on a dollar
for dollar basis. The Executive agrees to provide the Employer with written notice as soon as practicable following the date he
obtains a subsequent position, which notice shall further specify the amount of compensation the Executive will receive from such
subsequent employment or engagement during the Severance Period. The Executive must sign and tender the Release as described above
not later than sixty (60) days following the Executive’s last day of employment, or such earlier date as required by the Employer,
and if the Executive fails or refuses to do so, the Executive shall forfeit the right to such termination compensation as would
otherwise be due and payable. Subject to Paragraph 13 of this Agreement, the severance payments shall begin on the first pay period
following the date that is






    	7



    	



    

sixty (60) days after the Executive’s employment terminates. The initial salary continuation payment
shall include any unpaid salary continuation payments from the date the Executive’s employment terminated, subject to the
Executive’s executing and tendering the Release on the terms as set forth above, and the expiration
of any revocation period applicable thereto having passed without the revocation being exercised.


 


Additionally, if, following
an Involuntary Termination, the Executive elects COBRA continuation coverage, the Employer shall pay for such health insurance
coverage during the Severance Period (or, if shorter, for such period during which the Employer is otherwise required to provide
the Executive with COBRA coverage under applicable law) at the same rate as it pays for health insurance coverage for its active
employees (with the Executive required to pay for any employee-paid portion of such coverage). Thereafter, the Executive shall
be responsible for the payment of all premiums attributable to COBRA continuation coverage at the same rate as the Employer charges
all COBRA beneficiaries. Nothing herein provided, however, shall be construed to extend the period of time over which such COBRA
continuation coverage otherwise may be provided to the Executive and/or his dependents. Further, and notwithstanding anything herein
to the contrary, the Employer’s obligation to make the COBRA payments hereunder shall end on the date the Executive becomes
eligible for coverage under another employer’s group health plan. The Executive’s entitlement to the COBRA payments
shall be subject to the execution of the Release and made on the same terms as described above with respect to the salary continuation
payments. Notwithstanding the foregoing, if the Employer’s making the COBRA payments under this Paragraph 6B would violate
the nondiscrimination rules applicable to health plans or self-insured plans under Section 105(h) of the Code, or result in the
imposition of penalties under the Patient Protection and Affordable Care Act of 2010 and the related regulations and guidance promulgated
thereunder (the “PPACA”), the parties agree to reform this Paragraph in a manner as is necessary to comply with
the PPACA and the Code.


 


7. Protective Covenants. The Executive acknowledges and agrees that solely by virtue of his employment by, and relationship
with, the Employer, he has acquired and will acquire “Confidential Information”, as hereinafter defined, as well as special
knowledge of the Employer’s relationships with its customers, and that, but for his association with the Employer, the Executive
would not or will not have had access to said Confidential Information or knowledge of said relationships. The Executive further
acknowledges and agrees (i) that the Employer has long term, near-permanent relationships with its customers, and that those
relationships were developed at great expense and difficulty to the Employer over several years of close and continuing involvement;
(ii) that the Employer’s relationships with its customers are and will continue to be valuable, special and unique assets
of the Employer; and (iii) that the Employer has protectable interests that are critical to its competitive advantage in the
industry and would be of demonstrable value in the hands of a competitor. In return for the consideration described in this Agreement,
and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and as a condition precedent
to the Employer entering into this Agreement, and as an inducement to the Employer to do so, the Executive hereby represents, warrants,
and covenants as follows:






    	8



    	



    

A. The Executive has executed and delivered this Agreement as his free and voluntary act, after having determined that the
provisions contained herein are of a material benefit to him, and that the duties and obligations imposed on him hereunder are
fair and reasonable and will not prevent him from earning a comparable livelihood following the termination of his employment with
the Employer.


 


B. The Executive has read and fully understands the terms and conditions set forth herein, has had time to reflect on and consider
the benefits and consequences of entering into this Agreement, and has had the opportunity to review the terms hereof with an attorney
or other representative, if he so chooses.


 


C. The execution and delivery of this Agreement by the Executive does not conflict with, or result in a breach of or constitute
a default under, any agreement or contract, whether oral or written, to which the Executive is a party or by which the Executive
may be bound. In addition, the Executive has informed the Employer of, and provided the Employer with copies of, any non-competition,
confidentiality, work-for-hire or similar agreements to which the Executive is subject or may be bound.


 


D. The Executive agrees that, during the time of his employment with the Employer and for a period of eighteen (18) months
after the termination of the Executive’s employment hereunder for any reason whatsoever or for no reason, whether voluntary or
involuntary, or, if longer, during any applicable Severance Period, the Executive will not, except on behalf of the Employer, anywhere
in the United States of America or in any other place or venue where the Employer or any affiliate, subsidiary, or division thereof
now conducts or operates, or may conduct or operate, its business prior to the date of the Executive’s termination of employment:


 


(1) directly or indirectly, contact, solicit or accept if offered to the Executive, or direct any person, firm, corporation,
association or other entity to contact, solicit or accept if offered to it, any of the Employer’s customers or prospective customers
(as hereinafter defined) for the purpose of providing any products and/or services that are the same as or similar to the products
and services provided by the Employer to its customers during the term hereof; or


 


(2) solicit or accept if offered to him, with or without solicitation, on his own behalf or on behalf of any other person, the
services of any person who is a then current employee of the Employer (or was an employee of the Employer during the year preceding
such solicitation), nor solicit any of the Employer’s then current employees (or an individual who was employed by or engaged by
the Employer during the year preceding such solicitation) to terminate employment or an engagement with the Employer, nor agree
to hire any then current employee (or an individual who was an employee of the Employer during the year preceding such hire) of
the Employer into employment with himself or any company, individual or other entity; or






    	9



    	



    

(3) directly or indirectly, whether as an investor (excluding investments representing less than five percent (5%) of the common
stock of a public company), lender, owner, stockholder, officer, director, consultant, employee, agent, salesperson or in any other
capacity, whether part-time or full-time, become associated with any business involved in the retail sale of music, video or related
products (the “Business”); or


 


(4) act as a consultant, advisor, officer, manager, agent, director, partner, independent contractor, owner, or employee for
or on behalf of any of the Employer’s customers or prospective customers, with respect to or in any way with regard to any aspect
of the Employer’s Business and/or any other business activities in which the Employer engages during the term hereof.


 


In the event of any
breach of this subparagraph D, the Executive agrees that the restricted period shall be tolled during the time of such breach.


 


E. The Executive acknowledges and agrees that the scope described above is necessary and reasonable in order to protect the
Employer in the conduct of its business and that, if the Executive becomes employed by another employer, he shall be required to
disclose the existence of this Paragraph 7 to such employer and the Executive hereby consents to and the Employer is hereby given
permission to disclose the existence of this Paragraph 7 to such employer.


 


F. For purposes of this Paragraph 7, “customer” shall be defined as any person, firm, corporation, association, or
entity that purchased any type of product and/or service from the Employer or is or was doing business with the Employer or the
Executive within the twelve (12) month period immediately preceding termination of the Executive’s employment. For purposes of
this Paragraph 7, “prospective customer” shall be defined as any person, firm, corporation, association, or entity contacted
or solicited by the Employer or the Executive (whether directly or indirectly) or who contacted the Employer or the Executive (whether
directly or indirectly) within the twelve (12) month period immediately preceding termination of the Executive’s employment for
the purpose of having such persons, firms, corporations, associations, or entities become a customer of the Employer.


 


G. The Executive agrees that both during his employment and thereafter the Executive will not, for any reason whatsoever, use
for himself or disclose to any person not employed by the Employer any “Confidential Information” of the Employer acquired
by the Executive during his relationship with the Employer, both prior to and during the term of his employment. The Executive
further agrees to use Confidential Information solely for the purpose of performing duties with, or for, the Employer and further
agrees not to use Confidential Information for his own private use or commercial purposes or in any way detrimental to the Employer.
The Executive agrees that “Confidential Information” includes but is not limited to: (1) any financial, engineering,
business, planning, operations, services, potential services, products, potential products, technical information and/or know-how,
organization charts, formulas, business plans, production, purchasing, marketing, pricing, sales,






    	10



    	



    

profit, personnel, customer,
broker, supplier, or other lists or information of the Employer; (2) any papers, data, records, processes, methods, techniques,
systems, models, samples, devices, equipment, compilations, invoices, customer lists, or documents of the Employer; (3) any confidential
information or trade secrets of any third party provided to the Employer in confidence or subject to other use or disclosure restrictions
or limitations; and (4) any other information, written, oral, or electronic, whether existing now or at some time in the future,
whether pertaining to current or future developments, and whether previously accessed during the Executive’s tenure with the Employer
or to be accessed during his future employment with the Employer, which pertains to the Employer’s Business. The Employer acknowledges
and agrees that Confidential Information does not include (i) information properly in the public domain, or (ii) information in
the Executive’s possession prior to the date of his original employment with the Employer, except to the extent that such information
is or has become a trade secret of the Employer or is or otherwise has become the property of the Employer.


 


H. In the event that the Executive intends to communicate information to any individual(s), entity or entities (other than
the Employer), to permit access by any individual(s), entity or entities (other than the Employer), or to use information for the
Executive’s own account or for the account of any individual(s), entity or entities (other than the Employer) and such information
would have constituted Confidential Information hereunder but for the exceptions set out at (i) and (ii) of Paragraph G of this
Agreement, the Executive shall notify the Employer of such intent in writing, including a description of such information, no less
than fifteen (15) days prior to such communication, access or use.


 


I. During and after the term of employment hereunder, the Executive will not remove from the Employer’s premises any documents,
records, files, notebooks, correspondence, reports, video or audio recordings, computer printouts, computer programs, computer
software, price lists, microfilm, drawings or other similar documents containing Confidential Information, including copies thereof,
whether prepared by him or others, except as his duty shall require, and in such cases, will promptly return such items to the
Employer. Upon termination of his employment with the Employer, all such items including summaries or copies thereof, then in the
Executive’s possession, shall be returned to the Employer immediately.


 


J. The Executive recognizes and agrees that all ideas, inventions, patents, copyrights, copyright designs, trade secrets, trademarks,
processes, discoveries, enhancements, software, source code, catalogues, prints, business applications, plans, writings, and other
developments or improvements and all other intellectual property and proprietary rights and any derivative work based thereon (the
“Inventions”) made, conceived, or completed by the Executive, alone or with others, during the term of his employment,
whether or not during working hours, that are within the scope of the Employer’s business operations or that relate to any of the
Employer’s work or projects (including any and all inventions based wholly or in part upon ideas conceived during the Executive’s
employment with the Employer), are the sole and exclusive property of the Employer. The Executive further agrees that (1) he
will promptly disclose all Inventions to the Employer and hereby assigns to the Employer all present and future rights he has or
may have in those Inventions, including without limitation those relating to patent, copyright, trademark or trade secrets; and
(2) all of the Inventions eligible under the






    	11



    	



    

copyright laws are “work made for hire.” At the request of the Employer,
the Executive will do all things deemed by the Employer to be reasonably necessary to perfect title to the Inventions in the Employer
and to assist in obtaining for the Employer such patents, copyrights or other protection as may be provided under law and desired
by the Employer, including but not limited to executing and signing any and all relevant applications, assignments or other instruments.
The Executive hereby irrevocably designates and appoints the Employer and its duly authorized officers and agents as the Executive’s
agents and attorneys-in-fact to act for and on the Executive’s behalf and instead of the Executive, to execute and
file any documents and to do all other lawfully permitted acts to further
the above purposes with the same legal force and effect as if executed by the Executive, and the Executive acknowledges that this
designation and appointment constitutes an irrevocable power of attorney and is coupled with an interest. Notwithstanding the foregoing,
the Employer hereby notifies the Executive that the provisions of this Paragraph 7 shall not apply to any Inventions for which
no equipment, supplies, facility or trade secret information of the Employer was used and which were developed entirely on the
Executive’s own time, unless (1) the Invention relates (i) to the business of the Employer, or (ii) to actual or
demonstrably anticipated research or development of the Employer, or (2) the Invention results from any work performed by
the Executive for the Employer.


 


K. The Executive recognizes and agrees that he has no expectation of privacy with respect to the Employer’s telecommunications,
networking or information processing systems (including, without limitation, stored computer files, email messages and voice messages)
and that the Executive’s activity and any files or messages on or using any of those systems may be monitored at any time
without notice.


 


L. The Executive acknowledges that he may become aware of “material” nonpublic information relating to customers
whose stock is publicly traded. The Executive acknowledges that he is prohibited by law as well as by Employer policy from trading
in the shares of such customers while in possession of such information or directly or indirectly disclosing such information to
any other persons so that they may trade in these shares. For purposes of this Paragraph L, “material” information
may include any information, positive or negative, which might be of significance to an investor in determining whether to purchase,
sell or hold the stock of publicly traded customers. Information may be significant for this purpose even if it would not alone
determine the investor’s decision. Examples include a potential business acquisition, internal financial information that departs
in any way from what the market would expect, the acquisition or loss of a major contract, or an important financing transaction.


 


M. The Employer does not wish to incorporate any unlicensed or unauthorized material into its products or services or those
of its subsidiaries. Therefore, the Executive agrees that he will not knowingly disclose to the Employer, use in the Employer’s
business, or cause the Employer to use, any information or material which is confidential or proprietary to any third party including,
but not limited to, any former employer, competitor or client, unless the Employer has a right to receive and use such information.
The Executive will not incorporate into his work any material which is subject to the copyrights of any third party unless the
Employer has a written agreement with such third party or otherwise has the right to receive and use such information.






    	12



    	



    

N. It is agreed that any breach or anticipated or threatened breach of any of the Executive’s covenants contained in this Paragraph
7 will result in irreparable harm and continuing damages to the Employer and its business and that the Employer’s remedy at law
for any such breach or anticipated or threatened breach will be inadequate and, accordingly, in addition to any and all other remedies
that may be available to the Employer at law or in equity in such event, any court of competent jurisdiction may issue a decree
of specific performance or issue a temporary and permanent injunction, without the necessity of the Employer posting bond or furnishing
other security and without proving special damages or irreparable injury, enjoining and restricting the breach, or threatened breach,
of any such covenant, including, but not limited to, any injunction restraining the Executive
from disclosing, in whole or part, any Confidential Information. The Executive further agrees to pay all of the Employer’s
costs and expenses, including reasonable attorneys’ fees and accountants’ fees, incurred in enforcing such covenants.


 


8. Notices. Any and all notices required in connection with this Agreement shall be deemed adequately given only if
in writing and (a) personally delivered, or sent by first class, registered or certified mail, postage prepaid, return receipt
requested, or by recognized overnight courier, (b) sent by facsimile, provided a hard copy is mailed on that date to the party
for whom such notices are intended, or (c) sent by other means at least as fast and reliable as first class mail. A written
notice shall be deemed to have been given to the recipient party on the earlier of (a) the date it shall be delivered to the
address required by this Agreement; (b) the date delivery shall have been refused at the address required by this Agreement;
(c) with respect to notices sent by mail or overnight courier, the date as of which the Postal Service or overnight courier,
as the case may be, shall have indicated such notice to be undeliverable at the address required by this Agreement; or (d) with
respect to a facsimile, the date on which the facsimile is sent and receipt of which is confirmed. Any and all notices referred
to in this Agreement, or which either party desires to give to the other, shall be addressed to his residence in the case of the
Executive, or to its principal office in the case of the Employer.


 


9. Waiver of Breach. A waiver by the Employer of a breach of any provision of this Agreement by the Executive shall
not operate or be construed as a waiver or estoppel of any subsequent breach by the Executive. No waiver shall be valid unless
in writing and signed by an authorized officer of the Employer.


 


10. Assignment. The Executive acknowledges that the services to be rendered by him are unique and personal. Accordingly,
the Executive may not assign any of his rights or delegate any of his duties or obligations under this Agreement. The rights and
obligations of the Employer under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns
of the Employer.


 


11. Entire Agreement. This Agreement sets forth the entire and final agreement and understanding of the parties and contains
all of the agreements made between the parties with respect to the subject matter hereof. This Agreement supersedes any and all
other agreements, either oral or in writing, between the parties hereto, with respect to the subject matter hereof, including,
without limitation, that certain employment offer letter dated August 11, 2014 (the “Offer Letter”). The foregoing
notwithstanding, the Executive acknowledges and agrees that



    	13



    	



    

his confidentiality obligations as to the terms of the Offer Letter,
his obligation not to make any public statements as to the terms of the Offer Letter or his future position with the Employer without
the express written consent of the Employer’s current Chairman and CEO, Robert Higgins, and his obligation to complete a
pre-employment drug screening and background check, shall continue in effect. No change or modification of this Agreement shall
be valid unless in writing and signed by the Employer and the Executive.


 


12. Severability. If any provision of this Agreement shall be found invalid or unenforceable for any reason, in whole
or in part, then such provision shall be deemed modified, restricted, or reformulated to the extent and in the manner necessary
to render the same valid and enforceable, or shall be deemed excised
from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted
by law, as if such provision had been originally incorporated herein as so modified, restricted, or reformulated or as if such
provision had not been originally incorporated herein, as the case may be. The parties further agree to seek a lawful substitute
for any provision found to be unlawful; provided, that, if the parties are unable to agree upon a lawful substitute, the parties
desire and request that a court or other authority called upon to decide the enforceability of this Agreement modify those restrictions
in this Agreement that, once modified, will result in an agreement that is enforceable to the maximum extent permitted by the law
in existence at the time of the requested enforcement.


 


13. Section 409A. The Employer and the Executive intend that the payments and benefits provided for in this Agreement
either be exempt from Section 409A of the Code, or be provided in a manner that complies with Section 409A of the Code, and any
ambiguity herein shall be interpreted so as to be consistent with the intent of this Paragraph 13. In no event whatsoever shall
the Employer be liable for any additional tax, interest or penalty that may be imposed on the Executive by Code Section 409A or
damages for failing to comply with Section 409A. Notwithstanding anything contained herein to the contrary, all payments and benefits
under Paragraph 6B of this Agreement shall be paid or provided only at the time of a termination of the Executive’s employment
that constitutes a “separation from service” from the Employer within the meaning of Section 409A of the Code and the
regulations and guidance promulgated thereunder (determined after applying the presumptions set forth in Treas. Reg. Section 1.409A-1(h)(1)).
Further, if at the time of the Executive’s termination of employment with the Employer, the Executive is a “specified
employee” as defined in Section 409A of the Code as determined by the Employer in accordance with Section 409A of the Code,
and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such termination of
employment is necessary in order to prevent any accelerated or additional tax under Section 409A of the Code, then the Employer
will defer the commencement of the payment of any such payments or benefits hereunder (without any reduction in payments or benefits
ultimately paid or provided to the Executive) until the date that is at least six (6) months following the Executive’s termination
of employment with the Employer (or the earliest date permitted under Section 409A of the Code), whereupon the Employer will pay
the Executive a lump-sum amount equal to the cumulative amounts that would have otherwise been previously paid to the Executive
under this Agreement during the period in which such payments or benefits were deferred. Thereafter, payments will resume in accordance
with this Agreement.






    	14



    	



    

Notwithstanding anything
to the contrary in this Agreement, in-kind benefits and reimbursements provided under this Agreement during any calendar year shall
not affect in-kind benefits or reimbursements to be provided in any other calendar year, other than an arrangement providing for
the reimbursement of medical expenses referred to in Section 105(b) of the Code, and are not subject to liquidation or exchange
for another benefit. Notwithstanding anything to the contrary in this Agreement, reimbursement requests must be timely submitted
by the Executive and, if timely submitted, reimbursement payments shall be promptly made to the Executive following such submission,
but in no event later than December 31st of the calendar year following the calendar year in which the expense was incurred.
In no event shall the Executive be entitled to any reimbursement payments after December 31st of the calendar year following the calendar year in which the
expense was incurred. This paragraph shall only apply to in-kind benefits and reimbursements that would result in taxable compensation
income to the Executive.


 


Additionally, in the
event that following the date hereof the Employer or the Executive reasonably determines that any compensation or benefits payable
under this Agreement may be subject to Section 409A of the Code, the Employer and the Executive shall work together to adopt such
amendments to this Agreement or adopt other policies or procedures (including amendments, policies and procedures with retroactive
effect), or take any other commercially reasonable actions necessary or appropriate to (x) exempt the compensation and benefits
payable under this Agreement from Section 409A of the Code and/or preserve the intended tax treatment of the compensation and benefits
provided with respect to this Agreement or (y) comply with the requirements of Section 409A of the Code and related Department
of Treasury guidance.


 


14. Headings. The headings in this Agreement are inserted for convenience only and are not to be considered a construction
of the provisions hereof.


 


15. Execution of Agreement. This Agreement may be executed in several counterparts, each of which shall be considered
an original, but which when taken together, shall constitute one agreement.


 


16. Recitals. The recitals to this Agreement are incorporated herein as an integral part hereof and shall be considered
as substantive and not precatory language.


 


17. Legal Fees. The Employer agrees to reimburse the Executive’s reasonable legal fees incurred in the review and
negotiation of this Agreement, in an amount not to exceed Five Thousand Dollars ($5,000).


 


18. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New
York, without reference to its conflict of law provisions. Furthermore, the Executive agrees and consents to submit to personal
jurisdiction in the state of New York in any state or federal court of competent subject matter jurisdiction situated in New York,
New York. The Executive further agrees that the sole and exclusive venue for any suit arising out of, or seeking to enforce, the
terms of this Agreement shall be in a state or federal






    	15



    	



    

court of competent subject matter jurisdiction situated in New York, New
York. In addition, the Executive waives any right to challenge in another court any judgment entered by such New York court or
to assert that any action instituted by the Employer in any such court is in the improper venue or should be transferred to a more
convenient forum. Further, the Executive waives any right he may otherwise have to a trial by jury in any action to enforce
the terms of this Agreement.


 


IN WITNESS WHEREOF,
the parties have set their signatures on the date first written above.


 



	TRANS WORLD ENTERTAINMENT CORPORATION


 


a New York corporation








 


	 	

         

        

         
	 
	By: 	/S/ Robert J. Higgins	 	/s/ Michael Feurer	 
	Its: Chairman and Chief Executive Officer	 	Michael Feurer	 






    	16