Document:

Form of Award Agreement for Restricted Shares

 Exhibit 10.12 
 AWARD AGREEMENT FOR RESTRICTED SHARES 
 UNDER THE 
 FIVE
BELOW, INC. EQUITY INCENTIVE PLAN 
 THIS AWARD
AGREEMENT FOR RESTRICTED SHARES (this “Agreement”) is made between Five Below, Inc. (the “Company”) and [insert name] (the “Grantee”). 

WHEREAS, the Grantee previously entered into one or more Non-Qualified Stock Option Agreements (copies of which are attached as
Exhibit A and collectively, the “Option Agreements”) under the Five Below, Inc. Equity Incentive Plan (the “Plan”) pursuant to which the Grantee was awarded a stock option to purchase a number of shares of
the Company’s common stock (the “Common Stock”); and 
 WHEREAS, pursuant to (a) the Company’s
Notice and Information Statement for Option Holders, dated September 10, 2010 (“Information Statement”), and (b) the terms of the Option Agreements, as amended by the exercise notice executed by the Grantee effective as of
the record date (as such term is described in such exercise notice) (which notice is incorporated by reference herein, the “Exercise Notice”), the Grantee is permitted to exercise the unvested portion of his or her stock options to
purchase the restricted shares of Common Stock subject to the Option Agreements, provided the Grantee enters into this Agreement with the Company. 
 NOW, THEREFORE, in consideration of these premises and the agreements set forth herein, the parties, intending to be legally bound hereby, agree as follows: 

1. Purchase of Stock. Effective on the record date declared by the Board as stated in the Information Statement (the
“Effective Date”), pursuant to the Plan, the Option Agreements and the Exercise Notice, in exchange for an immediate, single sum cash payment equal to the Purchase Price set forth on Schedule I to this Agreement, the Company
hereby sells the Grantee the number of Shares set forth on Schedule I to this Agreement (the “Restricted Shares”), subject to the restrictions and on the terms and conditions set forth in this Agreement and the Plan. The
terms of the Plan are hereby incorporated into this Agreement by this reference, as though fully set forth herein. Capitalized terms used but not defined herein will have the same meaning as defined in the Plan. 

2. Vesting of Restricted Shares. 
 (a) Vesting Schedule; Repurchase. The Restricted Shares continue to be subject to the vesting conditions set forth in the applicable Option Agreements. Such vesting conditions are set forth on
Schedule I hereof. While unvested, the Restricted Shares are subject to repurchase by the Company pursuant to Section 2(b) below. 
 (b) All Unvested Shares Subject To Repurchase Upon Cessation of Employment. Except as otherwise provided on Schedule I, upon cessation of Grantee’s employment with the Company for any
reason or for no reason (and whether such cessation is initiated by the Company, the Grantee or otherwise), any Restricted Shares that have not, prior to the effective date of such cessation, become vested will be subject to repurchase by the
Company for a purchase price equal to the lesser of (A) a pro-rata portion of the Purchase Price attributable to those unvested Restricted Shares and (B) the Fair Market Value of those unvested Restricted Shares as of the date of such
cessation of employment. The Company shall exercise its right to repurchase unvested Restricted Shares by providing written notice to the Grantee at any time during the ninety (90) day period following the effective date of Grantee’s
cessation of employment with the Company. In the event the Board determines in good faith that the Company does not have sufficient proceeds to exercise its repurchase right of the unvested Restricted Shares as described herein, then the Company may
assign its right to repurchase such unvested Restricted Shares to any third party identified by the Board, in its sole discretion, including any Investor, as that term is defined in the Shareholders Agreement (as defined below). 

 3. Escrow of Shares. 

(a) The Company will cause the Restricted Shares to be issued in the Grantee’s name either by book-entry registration or issuance of
a stock certificate or certificates. 
 (b) While the Restricted Shares remain subject to repurchase by the Company pursuant to
Section 2(b) above, the Company will cause an appropriate stop-transfer order to be issued and to remain in effect with respect to the Restricted Shares. As soon as practicable following the time that any Restricted Share becomes vested
(and provided that appropriate arrangements have been made with the Company for the withholding or payment of any taxes that may be due with respect to such Share), the Company will cause that stop-transfer order to be removed. The Company may also
condition delivery of certificates for Restricted Shares upon receipt from the Grantee of any undertakings that it may determine are appropriate to facilitate compliance with federal and state securities laws. 

(c) If any certificate is issued in respect of Restricted Shares, that certificate will be legended as described herein and held in
escrow by the Company’s secretary or his or her designee. In addition, the Grantee may be required to execute and deliver to the Company a stock power with respect to those Restricted Shares. At such time as those Restricted Shares become
vested, the Company will cause a new certificate to be issued without that portion of the legend referencing the previously applicable vesting conditions and will cause that new certificate to be delivered to the Grantee (again, provided that
appropriate arrangements have been made with the Grantee for the withholding or payment of any taxes that may be due with respect to such Shares). 
 4. Stock Splits, etc. If, while any of the Restricted Shares remain subject to repurchase pursuant to Section 2(b) above, any of the events set forth in Section 3(c) of the
Plan occurs, then any and all new, substituted or additional securities or other consideration to which the Grantee is entitled by reason of the Grantee’s ownership of the Restricted Shares pursuant to the adjustment provisions of the Plan will
be immediately subject to the escrow contemplated by Section 3, deposited with the escrow holder and will thereafter be included in the term “Restricted Shares” for all purposes of the Plan and this Agreement.

 5. Rights of Grantee. The Grantee shall have the right to vote the Restricted Shares and to receive cash dividends or
distributions with respect to the Restricted Shares. 
 6. Tax Consequences. The Grantee acknowledges that the Company
has not advised the Grantee regarding the Grantee’s income tax liability in connection with the exercise of stock options, the vesting of the Restricted Shares or an election filed under Section 83(b) of the Code. The Grantee has reviewed
with the Grantee’s own tax advisors the federal, state, local and foreign tax consequences of the transactions contemplated by this Agreement. The Grantee is relying solely on such advisors and not on any statements or representations of the
Company or any of its agents. The Grantee understands that the Grantee (and not the Company) shall be responsible for the Grantee’s own tax liability that may arise as a result of the transactions contemplated by this Agreement. The Grantee has
been advised by the Company that he or she is required to file an election under Section 83(b) of the Code in connection with the purchase of the Restricted Shares. 

  
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 7. Additional Documents. As a condition to the effectiveness of the purchase of
Restricted Shares hereunder: 
 (a) the Grantee is required to file timely an election under Section 83(b) of the Code, as
amended, with respect to the purchase of the Restricted Shares (a form of Section 83(b) election is attached as Exhibit B); 
 (b) the Grantee is required to execute the “Adoption Agreement to the Second Amended and Restated Shareholders Agreement” attached as Exhibit C and thereby will become a party to,
and become bound by all the terms and conditions of, the Second Amended and Restated Shareholders Agreement dated September 1, 2010 by and among the Company and its shareholders (the “Shareholders Agreement”); and 

(c) the Grantee agrees upon request to execute any further documents or instruments necessary or desirable to carry out the purposes or
intent of this Agreement. 
 8. Restriction on Transfer of Restricted Shares. Except for the escrow described in
Section 3 hereof or the repurchase by the Company contemplated by Section 2(b) hereof, none of the Restricted Shares or any beneficial interest therein shall be transferred, encumbered, pledged or otherwise alienated or
disposed of in any way until they have become vested in accordance with Section 2 of this Agreement. Even after any of the Restricted Shares become transferable pursuant to this Agreement, they will remain subject to the transfer
restrictions set forth in the Shareholders Agreement. 
 9. Lock-Up Agreement. The Grantee hereby agrees that in
connection with any registration of the offering of any securities of the Company under the Securities of 1933, as amended (the “Securities Act”) for the account of the Company, if so requested by the Company, such Grantee shall not
sell or otherwise transfer any securities of the Company during the period specified by the Board (the “Market Standoff Period”), with such period not to exceed 180 days following the effective date of a registration statement of
the Company filed under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end or such Market Standoff Period. The provisions of this Section 9
shall be binding upon any transferee or assignee of any Shares and may be modified by the Company in accordance with the Shareholders Agreement. 
 10. Share Legends. All stock certificates representing the Shares shall have affixed thereto legends substantially in the following form (as may be modified by the Company in accordance with the
Shareholders Agreement), in addition to any other legends required by applicable state law: 
 THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 AS AMENDED, (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED WITHOUT REGISTRATION UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL,
SATISFACTORY TO FIVE BELOW, INC., THAT SUCH REGISTRATION IS NOT REQUIRED. THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF EXCEPT IN CONFORMITY WITH THE TERMS OF THE SECOND
AMENDED AND RESTATED SHAREHOLDERS AGREEMENT DATED SEPTEMBER 1, 2010, BETWEEN FIVE BELOW, INC. AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES), A COPY OF WHICH IS AVAILABLE AT THE PRINCIPAL OFFICES OF FIVE
BELOW, INC. SUCH AGREEMENT GRANTS CERTAIN RIGHTS TO FIVE BELOW, INC. (OR ITS ASSIGNEES) UPON THE SALE, ASSIGNMENT, TRANSFER, ENCUMBRANCE OR OTHER DISPOSITION OF FIVE BELOW, INC.’S SHARES. FIVE BELOW, INC. WILL UPON WRITTEN REQUEST FURNISH A
COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE. 
 11. Withholding. By executing this Agreement, the Grantee
acknowledges and agrees that the Company may withhold, in accordance with any applicable laws, from any consideration payable or 

  
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property transferable to the Grantee by the Company or any of its Affiliates any taxes required to be withheld by federal, state or local law as a result of the purchase or vesting of the
Restricted Shares or as a result of the election made by the Grantee pursuant to Section 83(b) of the Code. If the amount of any consideration payable to the Grantee is insufficient to pay such taxes or if no consideration is payable to the
Grantee, upon the request of the Company, the Grantee will pay to the Company an amount sufficient for the Company to satisfy any federal, state or local tax withholding requirements. 

12. The Plan. The Grantee has received a copy of the Plan, has read the Plan and is familiar with its terms, and hereby accepts
the Restricted Shares subject to all of the terms and provisions of the Plan, as amended from time to time. Pursuant to the Plan, the Board or its Committee is authorized to interpret the Plan and to adopt rules and regulations not inconsistent with
the Plan as it deems appropriate. The Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board or its Committee upon any questions arising under the Plan. 

13. Representations and Warranties. By executing this Agreement, the Grantee hereby represents, warrants, covenants, acknowledges
and/or agrees that: 
 (a) The Restricted Shares are being acquired for the Grantee’s own account, for investment purposes
only, and not for the account of any other person, and not with a view to the distribution thereof within the meaning of the Securities Act; 
 (b) No other person (other than the Grantee and the Company) has or will have a direct or indirect beneficial interest in the Restricted Shares; 

(c) The Restricted Shares have not been registered or qualified under the Securities Act or any state securities laws; 

(d) There is no public market for the Restricted Shares, there can be no assurance that any such market will ever develop and, therefore,
the Grantee may be required to hold the Restricted Shares indefinitely; 
 (e) In addition to complying with other similar
restrictions contained herein, the Grantee will not sell, transfer, pledge, hypothecate or otherwise dispose of any interest in the Restricted Shares unless such interest is registered in accordance with the Securities Act and applicable state
securities laws or an exemption from such registration is available and, if required by the Company, an opinion of counsel is delivered to the Company, in a form satisfactory to the Company, that such registration is unnecessary; and 

(f) The Company is under no obligation to register the Restricted Shares on behalf of the Grantee or to assist the Grantee in complying
with any exemption from registration. 
 14. General Provisions: 

(a) This Agreement, together with the Plan, the Exercise Notice and the Shareholders Agreement, represent the entire agreement between the
parties with respect to the purchase of the Restricted Shares and may only be modified or amended in a writing signed by both parties. 
 (b) Neither this Agreement nor any rights or interest hereunder shall be assignable by the Grantee, his beneficiaries or legal representatives, and any purported assignment in violation hereof shall be
null and void. 
 (c) Either party’s failure to enforce any provision or provisions of this Agreement shall not in any way
be construed as a waiver of any such provision or provisions, nor prevent that party 

  
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thereafter from enforcing each and every other provision of this Agreement. The rights granted both parties herein are cumulative and shall not constitute a waiver of either party’s right to
assert all other legal remedies available to it under the circumstances. 
 (d) The grant of Restricted Shares hereunder will
not confer upon the Grantee any right to continue in service with the Company or any of its subsidiaries or affiliates. 
 (e)
This Agreement and all claims or causes of action (whether in contract or tort) that may be based upon, arise out of or relate to this Agreement or the negotiation, execution or performance of this Agreement (including any claim or cause of action
based upon, arising out of or related to any representation or warranty made in or in connection with this Agreement or as an inducement to enter this Agreement) shall be governed by, and enforced in accordance with, the laws of the Commonwealth of
Pennsylvania, without regard to the application of the principles of conflicts of laws. 
 (f) This Agreement may be executed,
including execution by facsimile signature, in one or more counterparts, each of which shall be deemed an original, and all of which together shall be deemed to be one and the same instrument. 

[signature page follows] 

  
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 IN WITNESS WHEREOF, the parties have duly executed this Award Agreement for Restricted
Shares on the      day of             , 2010. 
  

			
	FIVE BELOW, INC.
		
	By:	 	  

	Name:	 	
	Title:	 	
	
	  

	[INSERT NAME OF GRANTEE]

  
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 SCHEDULE I 
 SCHEDULE OF RESTRICTED SHARES AND VESTING SCHEDULE 
 Attached

  
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 Exhibit A 
 OPTION AGREEMENTS 
 Attached 

  
 A-1

 Exhibit B 
 SECTION 83(b) TAX ELECTION 
 This statement is being made under Section 83(b)
of the Internal Revenue Code, pursuant to Treasury Regulation Section 1.83-2. 
 (1) The taxpayer who performed the services is:

  

					
		 	Name:	  	[Insert Grantee’s name]
		 	Address:	  	[insert Grantee’s address line 1]
		 		  	[insert Grantee’s address line 2]
		 	Taxpayer ID No.:	  	[insert grantee’s SSN]

 (2) The property with respect to which the election is being made is [insert # of shares] shares (the
“Restricted Shares”) of the common stock of Five Below, Inc. (the “Company”). 
 (3) The property was
transferred on             , 2010. 
 (4) The taxable year in which the election is
being made is the calendar year 2010. 
 (5) The shares will become vested as set forth in the attached Schedule I. 

(6) The fair market value at the time of transfer (determined without regard to any restriction other than a restriction which by its terms will never
lapse) is $6.67 per share. 
 (7) The taxpayer paid the amounts set forth as “Purchase Price” in the attached Schedule I.

 (8) A copy of this statement with Schedule I was promptly furnished to the entity for whom the taxpayer rendered the services
underlying the transfer of property. 
 (9) This statement is executed on the     day of
            , 2010. 
  

					
	By:	 	 	 	, Taxpayer

 This form and its Schedule I must be filed with the Internal Revenue Service Center with which
taxpayer files his/her Federal income tax returns within 30 days the transfer of the above-described property. 

  
 B-1

 Exhibit C 
 [Adoption Agreement to Second Amended and Restated Shareholders Agreement] 

  
 C-1Letter Employment Agreement, dated October 14, 2010

 Exhibit 10.17 
 Five Below, Inc. 
 1616 Walnut Street, Suite 400 

Philadelphia, PA 19103 
 October 14, 2010 
 Personal and Confidential 

David Schlessinger 
 Five Below, Inc.

 1616 Walnut Street, Suite 400 

Philadelphia, PA 19103 
 Re: Continuing
Employment Terms 
 Dear David: 

Reference is made to that certain letter agreement dated January 18, 2010 between you and Five Below, Inc. (the “Company”) regarding your
continuing employment terms (the “2010 Letter Agreement”, which letter was an amendment and restatement of your prior letter agreement dated April 20, 2005). In connection with the Investment Agreement, dated as of September 1,
2010, (the “Investment Agreement”) by and among the Company and certain parties thereto, including the “Purchasers” (as such term is defined in the Investment Agreement), you and the Purchasers have agreed to a term sheet, dated
September 1, 2010, (the “Term Sheet”), which sets forth the terms and conditions of your continued employment with the Company following consummation of the transaction contemplated by the Investment Agreement. This letter agreement
memorializes the terms and conditions agreed to in the Term Sheet and shall become effective upon consummation of the transaction contemplated by the Investment Agreement (the “Effective Date”) and shall supersede and replace in its
entirety the 2010 Letter Agreement. The terms and conditions of your continued employment with the Company following the Effective Date shall be as follows: 
  

			
	POSITION:	  	Executive Chairman.
		
	COMPENSATION:	  	You will be paid an annual base salary of $400,000, payable in accordance with the Company’s regular payroll practices, which annual base salary will be subject to annual
review for increase by the Company’s Board of Directors (the “Board of Directors”) or the Compensation Committee of the Board of Directors (the “Compensation Committee”). The Compensation Committee may, in its sole
discretion, approve payment of bonuses to you.
		
	EQUITY:	  	On the Effective Date, the Company Equity Incentive Plan (the “Equity Plan”) shall provide for an initial pool for which common shares of the Company may be issued equal
to 7% of the fully diluted, as converted common shares of the Company, available at Closing (as defined in the Investment Agreement), as calculated pursuant to the Investment Agreement, with 3% of the fully diluted, as converted common shares of the
Company, available at Closing, as calculated pursuant to the

					
		  	Investment Agreement, held back for post-closing grants for the existing management team and new hires to be granted in the discretion of the Board of
Directors.
		
		  	You will be granted, on the Effective Date, an option to purchase 2% of the fully diluted, as converted common shares of the Company, available at Closing, as calculated
pursuant to the Investment Agreement, under the Equity Plan, with terms and conditions set forth in the Non-Qualified Stock Option Agreement attached hereto as Exhibit B.
		
		  	To the extent (i) you are terminated without “Cause” (as defined below) or you terminate your employment for “Good Reason” (as defined below),
but excluding a termination of your employment due to your death or disability, and (ii) the Company has greater than $35.0m of EBITDA (A) in the fiscal year immediately preceding your termination of employment or (B) in the last
twelve consecutive months immediately preceding the month during which your termination of employment occurs, you shall have, within sixty days following your termination of employment, the right to cause the Company to purchase, and the Company
shall purchase, your “Rollover Shares” (as defined below) at a price per share equal to the per share fair market value at termination (as such fair market value is determined in good faith by the Board of Directors); provided, however,
that if such valuation was not determined by an independent valuation firm and you object to the valuation determination of the Board of Directors, within ten days of such determination you may request in writing, and the Board of Directors shall
retain, a valuation by an independent valuation firm selected by a majority of the Board of Directors, and such independent valuation firm shall determine the fair market value of the Rollover Shares, which determination shall be final and binding
upon you, the Company and all interested persons for the purpose of this paragraph. Your put right shall expire upon an initial public offering of the Company’s common stock (an “IPO”). “Rollover Shares” shall mean the
shares of common stock of the Company owned by you on the Effective Date, but does not include any of the shares of common stock of the Company acquired by you after the Effective Date, either by exercise of your options or
otherwise.
		
	BENEFITS:	  	You will be entitled to continue to receive the benefits which you currently enjoy, and you will participate in the most favorable health and welfare plans and tax
qualified retirement plans available to other employees of the Company, subject to the terms of those plans.
		
	SEVERANCE:	  	If the Company terminates your employment without “Cause”, or if you resign your employment with “Good Reason,” you will be entitled
to:
			
		  	 *
	  	payment of an amount equal to the greater of: (a) $400,000 (or $800,000 if any such event occurs after a “Change of Control Transaction”, as such term is defined
below) or (b) the greater of (i) your annual base salary on the date of such termination or (ii) except to the

  
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		  		  	extent a reduction of annual base salary was approved by you in writing, such higher annual base salary that was in effect prior to your termination of employment, for 12 months
following such termination (24 months if any such event occurs after a “Change of Control Transaction”), in each case, payable in accordance with the Company’s regular payroll practices and commencing on the first payroll date of the
Company following the thirtieth (30th) day of the termination of your employment (the “First Payroll Date”). The portion of the severance pay that would have been paid to you during the period between the termination of your employment and
the First Payroll Date had no thirty-day delay been required will be paid to you in a lump sum on the First Payroll Date and thereafter the remaining portion of the severance pay will be paid without delay as provided in this paragraph;
and
			
		  	 *
	  	(a) monthly payments equal to the applicable monthly premium for COBRA continuation coverage for so long as you are receiving such continuation coverage up to 18 months after
such termination, commencing on the First Payroll Date; provided that the portion of the COBRA premiums paid by you during the period between the termination of your employment and the First Payroll Date, if any, had no thirty-day delay been
required will be paid to you in a lump sum on the First Payroll Date; provided, further, that each monthly payment paid to you pursuant to this clause (a) shall be grossed up for Federal, state and local ordinary income taxes and payroll taxes
imposed as a result of such payments (but not additional taxes imposed under the Internal Revenue Code of 1986, as amended (the “Code”)), and (b) if you remain on COBRA coverage for the entire 18-month period, the Company will make
additional monthly payments to you for the 6-month period immediately following the expiration of the 18-month COBRA period equal to the amount of premiums that you would have paid had you been eligible for continued coverage under COBRA. The
monthly payments described in clauses (a) (including the gross-up payment) and (b) above shall be made on the Company’s first payroll date of the applicable month. Each gross-up payment shall be calculated based on the highest
marginal tax rate for federal ordinary income taxes and payroll taxes and the highest marginal tax rate applicable to ordinary income for the taxing state and local jurisdiction in which you reside at the time such payroll is calculated (after
giving effect to the tax benefit, if any, applicable for deductions of taxes paid to any other taxing jurisdiction).

  
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		  	For this purpose:
			
		  		  	“Cause” means (a) conviction of (or the entry of a plea of guilty or nolo contendere to) a crime that prevents you from effectively managing the Company or that has a
material, adverse effect on the reputation or business activities of the Company, (b) gross negligence, dishonesty, misappropriation of funds or other willful misconduct in the course of employment that has a material, adverse effect on the
reputation or business activities of the Company, or (c) substance abuse, including abuse of alcohol or use of controlled drugs (other than in accordance with a physician’s prescription).
			
		  		  	“Change of Control Transaction” means a “Change in Control” as such term is defined in the Company Equity Incentive Plan (as it exists from time to time);
provided, however, that (a) in no event shall the corporate transaction contemplated by the Investment Agreement be deemed a “Change of Control Transaction” for purposes of this letter agreement and (b) any change to the
definition of “Change in Control” that is less favorable to you will not apply to this letter agreement without your consent.
			
		  		  	“Good Reason” means (a) a material, adverse change in your title, authority, responsibilities or duties, (b) a reduction or other material adverse change in your
base salary or benefits, (c) a requirement that you report to anyone other than the Board of Directors, (d) a relocation of your principal offices by more than 25 miles, or (e) any other Company willful action or inaction that
constitutes a material breach by the Company of this letter agreement; provided, that, no event described in this paragraph shall constitute “Good Reason” unless (i) you provide written notice of the event within the 60-day period
following the occurrence of such Good Reason event, and (ii) the Company has not cured such event within 30 days of receipt of such notice. For the avoidance of doubt, Good Reason shall not exist hereunder unless and until the thirty-day cure
period following receipt by the Company of your written notice expires and the Company shall not have cured such circumstances, and in such case your employment shall terminate for Good Reason if you provide notice to the Company within 15 days
following the expiration of such thirty-day cure period that you wish to resign on account of “Good Reason,” and your termination date shall become effective on the first business day following the end of your 15 day notice
period.

  
 4 

			
		  	Notwithstanding the foregoing, all severance benefits will be contingent upon your execution of a fully effective and non-revocable general release of claims against the Company and
its affiliates, in substantially the form attached hereto as Exhibit A, within 30 days following the termination of your employment, which release will be provided to you within five days of the termination of your
employment.
		
	SECTION 280G	  	
	OF THE CODE	  	To the extent the common stock of the Company is not publicly traded on the relevant date, if any payment or benefit you would receive pursuant to a contemplated Change of Control
Transaction would constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code, the Company shall use commercially
reasonable efforts to seek to obtain the approval of the shareholders of the Company of any such “excess parachute payments” in a manner intended to be compliant with the provisions of Sections 280G(b)(5)(A)(ii) and 280G(b)(5)(B) of the
Code. To the extent that you are already entitled to any such payment or benefit, the foregoing shall apply to the extent you waive and forfeit your right to such payment or benefit.
		
	NONCOMPETE/	  	
	NONSOLICITATION:	  	In consideration for entering into this letter agreement, including, without limitation, the compensation to be paid to you hereunder, you agree that during your employment by the
Company and (i) for the applicable period following termination during which you are eligible to receive salary continuation if your employment is terminated without Cause, or if you resign your employment with Good Reason, or (ii) for the 18-month
period from the date of the termination of your employment with the Company for any other or for no reason, you will not, either directly or indirectly, on your own behalf or in the service of, together with or on behalf of any other person;
(a) own, manage, engage in, operate, control, work for, consult with, render services for, do business with, maintain any interest in (proprietary, financial or otherwise) or participate in the ownership, management, operation or control of,
any business, whether in corporate, proprietorship or partnership form or otherwise, that sells at retail products (1) predominantly to children, teens and pre-teens, (2) that are the same as or substantially similar to products that are
sold or are planned to be sold by the Company during the period in which you are employed by the Company and (3) at fixed price points of $10.00 or less anywhere in the United States or in any other country in which the Company sells or plans
to sell such products at such fixed price points during the period in which you are employed by the Company (a “Competitive Business”); provided, however, that the restrictions contained in this clause (a) shall not restrict the
acquisition by you, directly or indirectly, of less than 2% of the outstanding capital stock of any publicly traded company engaged in a Competitive Business; or (b) solicit, recruit or attempt to solicit or recruit any employee of the Company;
or (c) hire or attempt to hire any

  
 5 

			
		  	employee of the Company; provided, however that: (A) in the event that you terminate your employment with the Company for any reason other than on account of Good Reason, the
restrictions in clause (c) shall terminate on the date that is 18 months from the date of such termination and (B) in the event that your employment is terminated by the Company for any or no reason or by you for Good Reason, the restrictions in
clause (c) shall terminate on the date that is one (1) year from the date of such termination. Notwithstanding the foregoing the restrictions in each of clause (b) and clause (c) of the preceding sentence shall terminate upon the earlier of the
completion of (x) an IPO or (y) a Change of Control Transaction. For purposes of this letter agreement, “planned to be sold” or “plans to sell” refers only to written plans that have been approved by the Board of
Directors on or before the date of the termination of your employment with the Company.
		
		  	You acknowledge that the restrictions in the immediately preceding paragraph (the “Restrictive Covenants”) are reasonable and necessary to protect the legitimate interests
of the Company and its affiliates and that the duration and geographic scope of the Restrictive Covenants are reasonable given the nature of this letter agreement and the position you will hold within the Company. You further acknowledge that the
Restrictive Covenants contained herein are distinct and separate from any restrictive covenants contained in the Investment Agreement. You further acknowledge that the Restrictive Covenants are included herein in order to induce the Company to enter
into this letter agreement and that the Company would not have entered into this letter agreement in the absence of the Restrictive Covenants.
		
		  	If any court determines that any of the Restrictive Covenants or any part thereof, is unenforceable because of the duration or geographic scope of such provision, such court shall
have the power to modify such provision and, in its modified form, such provision shall then be enforceable.
		
	NONDISCLOSURE:	  	All information about the Company and its business furnished by the Company or on the Company’s behalf to you, or otherwise obtained by you in connection with your employment
with the Company, is referred to in this letter agreement as “Proprietary Information.” For purposes of this letter agreement, Proprietary Information: (i) shall include all documents which are prepared by you, including all
correspondence, memoranda, notes, summaries, analyses, studies, models, extracts of and documents and records reflecting, based on or derived from Proprietary Information as well as all copies and other reproductions thereof, whether in writing or
stored or maintained in or by electronic, magnetic or other means, media or devices; and (ii) shall not include information which is or becomes generally available to the public other than as a result of a disclosure by you. Unless otherwise agreed
to in writing by the Company, you agree that you will keep all Proprietary Information confidential and not disclose or reveal any Proprietary Information to any person. You agree that you will, upon the Company’s request, promptly deliver to
the Company all Proprietary Information in your possession or control.

  
 6 

			
	SPECIFIC	  	
	ENFORCEMENT:	  	You acknowledge that any breach by you, willfully or otherwise, of the Restrictive Covenants will cause continuing and irreparable injury to the Company for which monetary damages
would not be an adequate remedy. You shall not, in any action or proceeding to enforce any of the provisions of this letter agreement, assert the claim or defense that such an adequate remedy at law exists. In the event of any such breach by you,
the Company shall have the right to enforce the Restrictive Covenants by seeking injunctive or other relief in any court, without any requirement that a bond or other security be posted, and this letter agreement shall not in any way limit remedies
of law or in equity otherwise available to the Company. It is understood that any failure or delay by the Company in exercising any right, power or privilege hereunder shall not operate as a waiver thereof, nor shall any single or partial exercise
of any right, power or privilege hereunder preclude any other or further exercise thereof.
		
	SECTION 409A	  	
	COMPLIANCE:	  	Notwithstanding any provision to the contrary herein, no severance shall be paid pursuant to this letter agreement unless the termination of your employment constitutes a
“separation from service” (as such term is defined in Treas. Reg. Section 1.409A-1(h), including the default presumptions).
		
		  	To the maximum extent permitted under Section 409A of the Code (“Section 409A”), the severance payments and benefits payable under this letter agreement are intended to be
exempt from Section 409A in reliance on the “separation pay exception” under Treas. Reg. Section 1.409A-1(b)(9)(iii). If any payment, compensation or other benefit provided to you in connection with the termination of your employment is
determined by the Company, in whole or in part, not to be so exempt and to constitute “nonqualified deferred compensation” within the meaning of Section 409A and you are a specified employee as defined in Section 409A(a)(2)(B)(i), then
such “nonqualified deferred compensation” will not be paid before (i) the first regularly scheduled payroll date following the sixth (6th) month after the termination of your employment or (ii) the first regularly scheduled payroll date
following your death (the “New Payment Date”). The aggregate of any payments that otherwise would have been paid to you during the period between the date of termination and the New Payment Date will be paid to you in a lump sum on such
New Payment Date. Thereafter, any payments that remain outstanding as of the day immediately following the New Payment Date will be paid without delay over the time period originally scheduled, in accordance with the terms of this letter
agreement.
		
		  	Notwithstanding the other provisions hereof, this letter agreement is intended to comply with the requirements of Section 409A, to the extent applicable, and this letter agreement
shall be interpreted to avoid any penalty sanctions under Section 409A. Accordingly, all provisions herein, or incorporated by reference, shall be construed and interpreted

  
 7 

			
		  	to comply with Section 409A and, if necessary, any such provision shall be deemed amended to comply with Section 409A and regulations thereunder. If any payment or benefit cannot be
provided or made at the time specified herein without incurring sanctions under Section 409A, then such benefit or payment shall be provided in full at the earliest time thereafter when such sanctions will not be imposed. In no event may you
designate the calendar year of payment of any severance benefits payable to you under this letter agreement.
		
		  	Notwithstanding anything to the contrary contained in this letter agreement, all reimbursements and in-kind benefits provided hereunder shall be made or provided in accordance with
the requirements of section 409A of the Code, including, where applicable, the requirement that (i) any reimbursement shall be for expenses incurred during your lifetime, (ii) the amount of expenses eligible for reimbursement, or in-kind
benefits provided, during a taxable year may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, (iii) the reimbursement of an eligible expense will be made on or before the last
day of the taxable year following the year in which the expense is incurred, and (iv) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.
		
	ATTORNEYS FEES:	  	In connection with and promptly following the execution of this letter agreement, the Company shall reimburse you for the reasonable attorneys’ fees you incur in connection
herewith, including any attorney’s fees incurred in connection with assisting the Company in explaining your obligations under this letter agreement.
		
	MISCELLANEOUS:	  	You will continue to be an “at-will” employee who can resign or terminate your employment with the Company at any time. Likewise, the Company may terminate your employment
at any time and for any reason whatsoever, with or without “Cause” or advance notice.
		
		  	The Company will be entitled to withhold from any amounts to be paid or benefits provided to you hereunder any federal, state, local or foreign withholding, FICA contributions, or
other taxes, charges or deductions which it is from time to time required to withhold. The Company will be entitled to rely on the advice of counsel if any question as to the amount or requirement of any such withholding shall
arise.
		
		  	As a Company employee, you will continue to be expected to abide by all Company rules and regulations.
		
		  	Neither this letter agreement nor any of your rights, duties or obligations shall be assignable by you, nor shall any of the payments required or permitted to be made to you by this
letter agreement be encumbered, transferred or in any way anticipated, except as required by applicable laws.

  
 8 

			
		  	Any notice, request, instruction or other document given under this letter agreement shall be in writing and shall be addressed and delivered, in the case of the Company, to the
Secretary of the Company at the principal office of the Company and, in your case, to your address as shown in the records of the Company or to such other address as may be designated in writing by either party.
		
		  	This letter agreement shall be exclusively governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania, without regard to conflicts of law
doctrine.
		
		  	The provisions of this letter agreement are severable and the invalidity of any one or more provisions shall not affect the validity of any other provision.
		
		  	A waiver by either party of any breach of any provision of this letter agreement by the other party shall not operate or be construed as a waiver of any other or subsequent breach
by the other party.
		
		  	This letter agreement forms the complete statement of your employment terms with the Company, and supersedes any other agreements made to you by anyone, whether oral or written,
including without limitation, the Term Sheet and the 2010 Letter Agreement. This letter agreement may not be amended or revised except by a writing signed by the parties.
		
		  	This letter agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but which together shall constitute one and the same
instrument.

 [Signature Page Follows] 

  
 9 

 If you are in agreement with the foregoing, please execute this letter agreement at the signature line below
and return an executed copy to my attention. 
  

	
	Very truly yours,
	
	 /s/ Kenneth R. Bull

	Kenneth R. Bull
	Senior Vice President, Finance

  

	
	Accepted and agreed to by:
	
	 /s/ David Schlessinger

	David Schlessinger
	
	Date: October 14, 2010

  
 10 

 EXHIBIT A 
 GENERAL RELEASE OF CLAIMS 
 A general release is required as a condition
for receiving the severance payments described in the employment agreement between Five Below, Inc. (the “Company”) and David Schlessinger (“you”) dated October 14, 2010, (the
“Employment Agreement”); thus, by executing this general release (“General Release”), you, on your own behalf and on behalf of your heirs, estate and beneficiaries, generally release and forever
discharge the Company, its predecessors, successors or assigns, affiliates, shareholders or members, and their respective managers, members, partners, officers, directors, agents and employees and each of their heirs, executors, successors and
assigns (individually a “Released Party” and collectively the “Released Parties”) from any and all claims and causes of action of every kind, nature and description whatsoever, whether known, unknown
or suspected to exist, which you ever had or may now have, against any of the Released Parties, arising out of or relating to your employment relationship with the Company, and/or your separation from that employment relationship, including but not
limited to: 
 a. All claims arising out of or relating to the statements, actions, or omissions of the Released Parties.

 b. All claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful
practices arising under any federal, state, or local statute, ordinance, or regulation, including without limitation, claims under Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1866, the Age Discrimination in
Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Americans with Disabilities Act of 1990, as amended; the Civil Rights Act of 1991; the Family and Medical Leave Act of 1993; the Equal Pay Act of 1963; the
Worker Adjustment and Retraining Notification Act; the Employee Retirement Income Security Act of 1974; the Fair Credit Reporting Act; and any other federal, state or local anti-discrimination acts, state wage payment statutes and non-interference
or non-retaliation statutes under any applicable state or local laws or ordinances or any other legal restrictions on the Released Parties’ rights. 
 c. All claims for alleged wrongful discharge; breach of contract; breach of implied contract; failure to keep any promise; breach of a covenant of good faith and fair dealing; breach of fiduciary duty;
promissory estoppel; your activities, if any, as a “whistleblower”; defamation; infliction of emotional distress; fraud; misrepresentation; negligence; harassment; retaliation or reprisal; constructive discharge; assault; battery; false
imprisonment; invasion of privacy; interference with contractual or business relationships; any other wrongful employment practices; and violation of any other principle of common law. 

d. All claims for compensation of any kind, including without limitation, commission payments, bonus payments, vacation pay, expense
reimbursements, reimbursement for health and welfare benefits, and perquisites including payments, benefits, and reimbursements; except as otherwise provided in the Employment Agreement. 

e. All claims for back pay, front pay, reinstatement, other equitable relief, compensatory damages, damages for alleged personal injury,
liquidated damages, and punitive damages. 
 f. All claims for attorneys’ fees, costs, and interest. 

The foregoing release shall not extend to the following: (i) your rights to receive severance under the terms of the Employment
Agreement; (ii) any rights you may have to receive vested amounts under 

  
 11 

 
any of the Company’s employee benefit plans and/or pension plans or programs; (iii) your rights to medical benefit continuation coverage, on a self-pay basis, pursuant to federal
law (COBRA); (iv) any rights or claims that the law does not allow to be released and/or waived by private agreement; (v) any rights or claims that are based on events occurring after the date on which you sign this General Release;
(vi) any rights or claims that you have relating to your outstanding equity rights to receive shares of common stock of the Company, as well as any shares of common stock of the Company that you own; (vii) any rights or claims to the
“put” right set forth in the Employment Agreement with respect to your Rollover Shares and (viii) any claims to indemnification or insurance coverage, including but not limited to “D&O coverage”, that you may have with
respect to any claims made or threatened against you in your capacity as a director, officer or employee of the Company. You acknowledge and agree that even though claims and facts in addition to those now known or believed by you to exist may
subsequently be discovered, it is your intention to fully settle and release all claims you may have against the Released Parties, whether known, unknown or suspected. 
 It is further understood and agreed that you are waiving any right to initiate an action in state or federal court by you or on your behalf alleging discrimination on the basis of race, sex, religion,
national origin, age, disability, marital status, or any other protected status or involving any contract or tort claims based on your termination from the Company. It is also acknowledged that your termination is not in any way related to any
work-related injury. 
 This General Release shall be construed and enforced in accordance with, and governed by, the laws of
the Commonwealth of Pennsylvania, without regard to principles of conflict of laws. If any clause of this General Release should ever be determined to be unenforceable, it is agreed that this will not affect the enforceability of any other clause or
the remainder of this General Release. 
 You understand and agree that the compensation and benefits described in the
Employment Agreement offer you consideration greater than that to which you would otherwise be entitled. You acknowledge that before entering into this agreement, you have had the opportunity to consult with any attorney or other advisor of your
choice, and you have been advised to do so, and to the extent you deem appropriate, you have fully availed yourself of this right. You acknowledge that you have executed this General Release knowingly and voluntarily with full understanding of its
terms and after having been advised and having had the opportunity to seek and receive advice and counsel from your attorney. You acknowledge that you have been given a period of at least 21 days within which to consider this General Release or have
knowingly and voluntarily waived your right to do so. You understand that you may revoke this General Release during the seven days following the execution of this General Release by delivering notice to the Company. If no such revocation occurs,
this General Release shall become effective on the eighth day following the execution of this General Release. 
 [Signature
Page Follows] 

  
 12 

 I hereby state that I have carefully read this General Release and that I am signing this
General Release knowingly and voluntarily with the full intent of releasing the Released Parties from any and all claims, except as set forth herein. Further, if signed prior to the completion of the 21 day review period, this is to acknowledge
that I knowingly and voluntarily signed this General Release on an earlier date. 
  

					
	  
	 		 	  

			
	Date	 		 	David Schlessinger

  
 13 

 EXHIBIT B 
 STOCK OPTION AWARD AGREEMENT 
 [See Exhibit 10.22 to Form S-1 filed on April
17, 2012.] 

  
 14

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