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THIS EMPLOYMENT AGREEMENT is effective as of the 1 st day of May, 2003 by and between Trans World Entertainment
Corporation, a New York corporation (the "Company"), and Robert J. Higgins ("Higgins").
WHEREAS, Higgins has served as the President and Chief Executive Officer of the Company and as the Chairman of its
Board of Directors since 1973; and
WHEREAS, Higgins and the Company executed an employment agreement effective as of May 1, 1998, which will end on
April 30, 2004 (the "1998 Employment Agreement"); and
WHEREAS, the Company recognizes that Higgins' contribution to the growth and success of the Company has continued
to be substantial throughout the term of the 1998 Employment Agreement and that without his continued leadership and vision
the Company would not have achieved and maintained its current status in the industry; and
WHEREAS, the Company desires to renegotiate and extend the terms of the 1998 Employment Agreement to assure the
Company of Higgins' continued services in a leadership capacity and to compensate him therefor; and
WHEREAS, Higgins is willing to commit to continue serving the Company on the terms and conditions provided in this
NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements contained herein and
intending to be legally bound hereby, the parties agree as follows:
SECTION 1. CAPACITY AND DUTIES
1.1 Employment. The Company hereby employs Higgins and Higgins hereby accepts employment by the Company
upon the terms and conditions hereinafter set forth for a term commencing on the date hereof and expiring on April 30, 2008
(unless Higgins' service is sooner terminated as set forth below) (the "Contract Period").
1.2 Capacity and Duties.
1.2.1 Higgins shall be employed by the Company generally as its