EXHIBIT 10.1
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                              EMPLOYMENT AGREEMENT

     AGREEMENT, dated as of October 12, 2007 and effective as of June 1, 2007,
and between TSR, INC., having its principal office at 400 Oser Avenue,
Hauppauge, New York 11788 (the "Company"), and JOSEPH F. HUGHES, residing at
XXXXX XX, Laurel Hollow, New York 11791 ("Hughes").

     WHEREAS, Hughes has been employed as the Company's Chief Executive Officer
since inception of the Company and has been a key factor in its growth and
development; and

     WHEREAS, the Company's Board of Directors desires to encourage and
emphasize, during the intermediate term, the continued building of the
fundamental business and acquisitions of new businesses all for the purposes of
improving operating results.

     WHEREAS, The Company's Board of Directors has determined that it would be
advantageous for the Company to implement its current philosophy for the Company
through the leadership of Hughes; and

     WHEREAS, the Board of Directors deems it in the best interest of the
Company in furtherance of the foregoing to insure to the extent possible, the
continued employment and availability of Hughes and Hughes is willing to
continue his employment with the Company pursuant to the terms and conditions
herein:

     NOW, THEREFORE, the parties agree as follows:

     1. The Company employs Hughes as President and Chief Executive Officer of
the Company to perform such duties consistent with such position and such other
related duties as may be assigned to him from time to time by the Company's
Board of Directors. Hughes shall be employed at the Company's executive offices,
primarily in the metropolitan New York area.

     2. During the term of this Agreement, Hughes shall devote his best efforts,
knowledge and skill and shall devote all of his working time and attention to
the performance of his duties hereunder. Except in the case of earlier
termination as herein specifically provided, the term of this Agreement (the
"term") shall commence as of June 1, 2007 and terminate on May 31, 2009.

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     3. (a) As compensation for all services to be rendered by Hughes in all
capacities hereunder, including services as an officer and director of the
Company or any of its subsidiaries, the Company will pay or cause to be paid to
Hughes during the Term a base salary (the "Base Salary") of $498,000.

        (b) In addition to the compensation set forth in (a) Hughes shall be
entitled to a bonus equal to 4% of the Pre-Tax Profits up to $1,000,000 and 6%
of the Pre-Tax Profits in excess of $1,000,000, but the bonus shall not exceed
$250,000. The bonus provided for hereunder shall be payable by the Corporation
to Hughes within 120 days of the end of the fiscal year, for the period to which
such bonus relates. The Company shall pay to Hughes as an advance payment of the
bonus within 30 days after the end of each of the first three fiscal quarters,
an amount equal to the bonus that would have been earned through the end of such
fiscal quarter. In the event that following any fiscal quarter or following
completion of the Company's audited financial statements, any advance payment of
the bonus previously paid with respect to any fiscal year (or portion thereof)
exceeds the amount that Hughes is entitled to through the end of such fiscal
quarter or fiscal year, Hughes shall promptly return such excess. For purposes
of this provision, Pre-Tax Profits shall mean the Company's profits as reported
during the fiscal year ending May 31, as determined in accordance with generally
accepted accounting principles, before the calculation of such bonus. There
shall be adjustments made to Pre-Tax Profits for the amount of any extraordinary
items of income or loss attributable to such fiscal year.

     4. Hughes shall be entitled to reimbursement for expenses, provided that
such expenses are reasonable and are incurred in connection with the performance
of his duties hereunder. Such expense reimbursement shall be in accordance with
and subject to the expense reimbursement policies and procedures applicable to
senior executives, as in effect from time to time during the Term of this
Agreement. In addition, Hughes shall be entitled to all benefits and perquisites
generally available during the Term to the Company's senior executive officers
as well as those benefits and perquisites, which he has been receiving prior to
the date of this Agreement. Such perquisites shall include membership in a
country club and use of a Company owned or leased automobile.

     5. During each full Fiscal Year of Hughes' employment hereunder, he shall
be entitled to four weeks of vacation time, which to the extent not taken, shall
be non-cumulative and non-compensatory.

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     6. In the event of Hughes' death during the Term, this Agreement shall
terminate immediately, and Hughes' legal representatives shall be entitled to
receive from the Company in one lump sum an amount equal to his Base Salary for
an additional period equal to one year. In addition, within 120 days following
completion of the Fiscal Year, Hughes' legal representatives shall also be
entitled to receive a pro rata portion of the bonus for which Hughes would have
been entitled to at the end of the Fiscal Year had his death not occurred during
such year.

     7. If, during the Term, Hughes is unable to perform his duties hereunder on
account of illness, accident or other physical or mental incapacity, and such
illness or other incapacity shall continue for a period of more than six months,
the Company shall have the right, on fifteen days' written notice (given after
such period) to Hughes, to terminate this Agreement. In such event, the Company
shall be obligated to pay to Hughes his Basic Compensation at the annual rate
prevailing at the time of such termination for an additional period equal to the
difference between two years from the date which such disability commenced and
the period during which Hughes was absent from work as a result of such
disability through the date of termination. However, if, prior to the date
specified in such notice, Hughes' illness or incapacity shall have terminated
and he shall have taken up the performance of his duties hereunder, Hughes shall
be entitled to resume his employment and receive the compensation payable
hereunder as though such notice had not been given.

     8. During and after the Term, Hughes will not disclose to anyone (except to
the extent reasonably necessary for Hughes to perform his duties hereunder) any
"confidential information" as such term is hereinafter referred to concerning
the business or affairs of the Company or of any of its affiliates or
subsidiaries. "Confidential information" shall mean all information which Hughes
may have acquired in the course of or as incident to his employment or prior
dealings with the company or with any of its affiliates, including, without
limitation, customer lists, business or trade secrets of, or methods of
techniques used by, the Company or any of its affiliates or subsidiaries in
their respective businesses, or any information concerning the customers of any
of them. For purposes of this section, confidential information shall not
include information which (i) was known to the public prior to the date of
communication thereof by Hughes, (ii) becomes known to the public thereafter
other than through communications by Hughes, or (iii) becomes known to Hughes
subsequent to the date of his termination of employment with the Company.

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     9. Hughes acknowledges that his services and responsibilities are of unique
and particular significance to the Company and that his position with the
Company will give him a close knowledge of the Company's and its affiliates'
policies and trade secrets. Hughes further acknowledges that in the event the
Company loses the services of Hughes, it could be subject to the loss of
valuable business relationships which have been cultivated for the Company by
Hughes. Hughes acknowledges that as a result of the loss of any of the
foregoing, the Company would sustain substantial and irreparable damages.
Therefore, in consideration of the foregoing, Hughes agrees that, in the event
that there is a termination of this Agreement (including as a result of Hughes'
breach), except where the termination is a result of a breach of this Agreement
by the Company, he will not, during the unexpired portion of the original
contemplated Term and for a period of two years after such period with respect
to the restriction in sub-paragraph (ii) below, directly or indirectly, on
behalf of himself or others:

           (i) engage in any business, engaged in by the Company during a period
of 12 months prior to the termination of Hughes' employment with the Company
which is competitive with any significant business engaged in by the Company, in
any jurisdiction where the Company engaged or engages in such business. For
purposes of determining whether any aspects of the Company's business is
significant such business shall be deemed to be significant if during the 12
month period prior to the termination of Hughes' employment with the Company the
Company either (a) recognized revenues equal to 2% of its aggregate revenue from
such business recognized or (b) Pre-Tax Profits equal to 5% of the Company's
Pre-Tax Profits, during such period.

           (ii) call on for the purpose of soliciting, diverting or taking away
from the Company or its affiliates, or employ, any person who is an employee of
the Company or any of its affiliates or any person who was an employee of the
Company or its affiliates during the period of Hughes' employment with the
Company, except that this restriction shall not apply to any person who has not
been employed by the Company for a period of one year prior to the date of such
solicitation.

     10. Except as otherwise provided in this Agreement, the Company shall have
the right to terminate this Agreement and Hughes' employment hereunder only for
a Justifiable Cause and Hughes shall have the right to terminate this Agreement
and his employment hereunder only for Justifiable Cause. "Justifiable Cause" as
it relates to a termination by the Company shall be limited to (i) a material
breach by Hughes of any material provision of the Agreement, but only if after
reasonable notice and only after such notice Hughes fails to cure such breach
within a reasonable time or (ii) if such breach is not subject

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to cure, Hughes shall fail on an on-going basis to comply thereafter with the
provisions of this Agreement with respect to which he was in such breach within
a reasonable time period. In the event the Company terminates this Agreement
other than for Justifiable Cause, or Hughes terminates this Agreement for
Justifiable Cause, the damages to be awarded to Hughes shall be the value of all
compensation and benefits including without limiting the generality of the
foregoing, bonuses, options, incentive payments, benefits under other plans and
programs or perquisites or fringes sponsored by the Company. Nothing contained
herein shall restrict the Company from asserting such rights as it may have to
assert defenses regarding the payment or in support of mitigation of damages.

     11. Hughes represents and warrants to the Company that he is not under any
obligation of a contractual or other nature to any person, firm or corporation
other than the Company which would be inconsistent or in conflict with this
Agreement, or which would prevent, limit or impair in any way the performance by
him of his obligations hereunder.

     12. The waiver by either party of a breach of any provision of this
Agreement shall not operate as or be construed as a waiver of any subsequent
breach thereof.

     Any notice referred to herein shall be sufficient if furnished in writing,
and delivered in person or mailed by certified mail (return receipt requested)
to the respective parties at his or its address set forth above or such other
address as either party may from time to time designate in writing.

     13. Hughes' rights and interest hereunder may not be assigned, pledged or
encumbered by him except with the written consent of the Company.

     14. This Agreement supersedes any and all prior written or oral agreements
between the company and Hughes, and may not be amended or modified except by a
writing signed by the party to be charged.

     15. This Agreement is executed and delivered in the State of New York and
shall be construed and enforced in accordance with the laws and decisions of
said State applicable to contract made and performed entirely within said State.

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.


                                        TSR, INC.


/s/ Joseph F. Hughes                          BY: /s/ John G. Sharkey
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Joseph F. Hughes                                  John G. Sharkey - VP Finance
President