ONE PRICE CLOTHING STORES INC
EMPLOYMENT AGREEMENT WITH THOMAS R. KELLY
<DOCUMENT>
<TYPE>EX-10.A
<SEQUENCE>2
<FILENAME>0002.txt
<DESCRIPTION>EMPLOYMENT AGREEMENT WITH THOMAS R. KELLY
<TEXT>


                              EMPLOYMENT AGREEMENT

         THIS  AGREEMENT,  made and entered  into as of the 30th day of October,
2000, by and between One Price  Clothing  Stores,  Inc., a Delaware  corporation
with its principal  place of business in  Spartanburg  County,  South  Carolina,
hereinafter referred to as "Employer," and Thomas R. Kelly, currently a resident
of Tennessee, hereinafter referred to as "Employee."

                              W I T N E S S E T H :

         For and in  consideration  of the mutual  covenants and promises of the
parties  hereto and the  benefits  inuring to the parties  hereto,  Employer and
Employee agree as follows:

1.       EMPLOYMENT.  Subject to the terms and conditions of this Agreement,
Employer employs Employee as Senior Vice President,  General Merchandise Manager
and Employee  accepts such  employment with Employer.  The employment  hereunder
shall commence on the date the Employee  reports for full-time  work,  currently
scheduled for October 30, 2000.

2. DUTIES OF EMPLOYEE.  Employee shall serve Employer faithfully and to the best
of his ability. Employee shall devote his full time and efforts to his duties as
an employee of the Employer.

3.       COMPENSATION AND BENEFITS.

(a)              Salary.  For all  services  rendered  to  Employer  under this
                 Agreement,  Employer  shall pay Employee an annual base salary
                 of not less than $300,000,  subject to annual review,  payable
                 in bi-weekly installments in accordance with the usual payroll
                 practice of Employer, less all legally required deductions.

(b)              Bonus. Employee shall be subject to the normal management
                 bonus structure, as approved annually by the Board of
                 Directors.

(c)              Stock Options.  As an inducement to Employee joining the

                 Company,  Employee  shall  receive  a grant  of  50,000  stock
                 options for the purchase of shares of Employer's  common stock,
                 with an exercise price equal to the average of the high and low
                 sales  price per share of such  common  stock on the  effective
                 date  of  this  agreement,  exercisable  twenty  (20%)  percent
                 immediately  and then twenty (20%) percent each year thereafter
                 from the date of grant for the next four (4) years.  The "grant
                 date" of such options shall be the date the Employee signed the
                 offer letter, October 13, 2000. Employee understands and agrees
                 that such  options  will be the  subject  of a  separate  stock
                 option  plan  which  will be  filed  by the  Employer  with the
                 Securities  & Exchange  Commission  on Form S-8 as  promptly as
                 practicable,  and that  Employee  shall  not have the  right to
                 exercise such options until such filing is completed.

(d)              Other Benefits.

(i)                        During the term of his employment,  Employee shall be
                           entitled to participate  in all employee  benefits as
                           are customarily provided to its officers by Employer,
                           and to participate in such other employee benefits as
                           may from  time to time be  instituted  by  Employer's
                           Board of Directors.

(ii)                       Employee shall also be entitled to  reimbursement  of
                           all reasonable hotel, travel, entertainment and other
                           business  expenses  actually  incurred by Employee in
                           the course of Employee's  employment  upon submission
                           to Employer of satisfactory documentation thereof.

(e)               Moving Expenses.  Employer shall reimburse Employee for:


(i)                        Mileage reimbursement for interim travel allowance of
                           $1,500.

(ii)                       Two house-hunting trips to include four nights, five
                           days of hotel accommodations and meals.

(iii)                      Transportation of household goods, from Tennessee to
                           South Carolina billed directly to the company.

(iv)                       Reimbursement of mileage incurred driving up to 2
                           vehicles from Tennessee to South Carolina upon
                           relocation to South Carolina.

(v)                        Upon reporting for work Employer  agrees to reimburse
                           Employee  up to $6,000 for interim  living  expenses,
                           such reimbursement to cover lodging only.

(vi)                       Employer  shall  pay  brokerage  fees  up to  6%  and
                           similar  expenses  related to the sale of  Employee's
                           home  and  for  loan  origination  fees  up to 1% for
                           purchase  of a new home.  This  payment  will be made
                           upon  presentation of supporting  documentation on or
                           after the first day of employment.

(vii)                      The allowance for (ii) and (v) is available within a
                           24 month period from date of hire.

(f)               Payments Upon Termination.

(i)  In the event Employee is terminated by Employer,  without  cause,  Employer
     shall continue Employee's salary following  Employee's  termination for six
     (6)  additional  months at  Employee's  annual base salary in effect at the
     date of Employee's termination, payable in accordance with Employer's usual
     payroll  practices.  In addition,  provided Employee has diligently pursued
     another  position  following  his  involuntary  termination,  in the  event
     Employee has not taken a position with another entity (including a position
     with a company, or partnership, or substantially full-time self employment)
     by the end of such  six  months  from the  date of  Employee's  involuntary
     termination,  Employer  shall pay to Employee up to an  additional  six (6)
     months salary continuation on a bi-weekly basis so long as other employment
     has not begun and  Employee  is  continuing  to pursue  diligently  another
     position.  Employer  shall be  entitled  to  receive  from  Employee,  upon
     request,  reasonable  proof of such  diligent  effort(s) to pursue  another
     position, failing which, such additional six months of salary shall cease.

(ii) In the event Employee voluntarily  terminates his employment with Employer,
     or is terminated for "cause", he shall be entitled to no additional payment
     upon such  termination  other  than any then  accrued  but  unpaid  salary,
     vacation pay, or other normal  reimbursement  items. "Cause" shall mean (a)
     commission by Employee of any felony, (b) the commission by Employee of any
     crime or other activity  involving  dishonesty or moral turpitude,  (c) the
     engagement  by  Employee in any act of fraud,  misappropriation  or similar
     misfeasance,   (d)  the   engagement   by  Employee  in  any   activity  in
     contravention  of paragraph 5 hereof  ("Confidential  Information")  or any
     action otherwise  resulting in a material adverse effect to Employer or (e)
     repeated non-attentiveness by Employee to his duties under this Agreement.

(g)  Change of Control. In the event the Employee's  employment with the Company
     is terminated by the Employer  without  Cause,  or for "Good Reason" by the
     Employee,  within 24 months  after  "Change of  Control"  of  Employer  (an
     "Employment Event"),  then Employer shall pay to Employee, in one lump sum,
     an amount  equal to  eighteen  (18)  months  severance  pay rather than the
     maximum of twelve (12) months  severance pay currently  provided for in the
     Agreement.  Termination for "Good Reason" shall be deemed to have occurred,
     and the Employee  shall be entitled to the benefits of this  provision,  if
     the Employee  voluntarily  terminates his employment  after 30 days written
     notice to Employer and  following  the  occurrence  of any of the following
     events, provided a "Change of Control" has occurred:

(i)  the assignment to the Employee of any duties  inconsistent with the highest
     position (including status,  offices,  titles and reporting  requirements),
     authority,  duties or responsibilities  attained by the Employee during the
     period of his  employment  with the  Employer or any action by the Employer
     which  results  in a material  diminishment  in such  position,  authority,
     duties  or  responsibilities  as were in  effect  immediately  prior to the
     "Change of Control";

(ii) a decrease in the Employee's  compensation (including base salary, bonus or
     fringe benefits)

(iii)relocation  by Employer of the Employee  more than 50 miles  outside of the
     Greenville/Spartanburg area of South Carolina; or

(iv) failure of any successor of the Employer to comply with this Agreement.

         In  consideration  for the benefits  conferred  to Employee  under this
         provision,  in the absence of an Employment  Event  Employee  agrees to
         continue his employment, following a "Change of Control," for a minimum
         period of six (6) months.

         In  addition,  should a "Change of Control"  occur,  all stock  options
         granted by Employer to Employee,  and not yet expired as of the date of
         such "Change of Control," shall become immediately exercisable. In such
         event,  the  normal  expiration  date  shall  apply  to  such  options,
         provided,  however,  that Employee  shall have 90 days to exercise such
         options in the event of termination following an Employment Event.

         For  purposes  hereof,  "Change  of  Control"  shall be  deemed to have
         occurred following either of the following two events:

(i)               A change in the Board of Directors  of the  Company,  with the
                  result  that   members  of  the  Board,   as  elected  by  the
                  stockholders  of the  Company  on June  10,  1998  ("Incumbent
                  Directors"),  no longer  constitute  a majority of such Board,
                  provided  that any  person who  becomes a  director  and whose
                  appointment  or election  was  supported  by a majority of the
                  Incumbent  Directors shall be considered an Incumbent Director
                  for purposes hereof; or;

(ii)              The  occurrence of a Section 11 (a) (ii) Event,  as defined in
                  the  Shareholders  Rights  Agreement,  dated November 3, 1994,
                  between  Wachovia  Bank of North  Carolina,  N.A.,  as  Rights
                  Agent, and Employer ("Right Agreement"), as amended, provided,
                  however, that for those purposes the applicable percentage for
                  a Change of Control to arise from a change in stock  ownership
                  shall  be 40%  and  not  20%  as  provided  for in the  Rights
                  Agreement.

4.   CONFIDENTIAL INFORMATION.  Employee acknowledges that during his employment
     he will have access to confidential  information belonging to the Employer.
     Such confidential information shall consist of all information disclosed to
     Employee as a result of employment  by Employer not generally  known in the
     retail  business  in  which  Employer  is  engaged  including   information
     concerning Employer's suppliers,  including the costs, quantities and types
     of  goods  supplied,  and  the  identity  of  such  suppliers;  information
     concerning the Employer's  marketing  and/or sales strategy or plans;  real
     estate strategy and expansion  plans; all pricing  information  relating to
     merchandise  offered  for  sale  by  Employer,   customers'  list  and  all
     information  dealing  with  customers'  needs  or  preferences;   all  data
     processing  information;  all  financial  information  including  financial
     statements,  financing  plans and  forecasts,  and any and all  information
     designated or marked as confidential. Employee will not use or disclose, or
     otherwise made available, such confidential information to any other person
     or entity without prior express written consent of Employer,  either during
     or following the termination of Employee's employment.  Upon termination of
     employment,  Employee  shall turn over to Employer all property then in his
     possession or custody belonging to Employer and shall not retain any copies
     or  reproductions  of  correspondence,   memoranda,   reports,   notebooks,
     drawings,  photographs,  or  other  documents  relating  in any  way to the
     affairs  of  Employer,   including  any  such   information   on  Employees
     computer(s), whether or not owned by the Employer.

5.   NON-COMPETITION.

     (a)  Upon  termination  of Employee's  employment  with  employer,  whether
          voluntary or involuntary,  and whether with or without cause, Employee
          will not, for a period of one (1) year from date of such  termination,
          conduct or engage in, directly or indirectly,  alone or jointly,  with
          any  other  person or  corporation  as  agent,  consultant,  employee,
          manager, purchaser, proprietor, stockholder, co-partner, or otherwise,
          and type of  "Off-price"  retail  apparel  business whose price points
          and/or  customer base could  reasonably  be considered in  competition
          with  the  business  of  Employer,  either  now or at the time of such
          termination.  Ceiling  price  points and single  price point  concepts
          shall be included.  This restriction applies to the continental United
          States.

     (b)  Employee  agrees not to employ,  solicit for employment or cause to be
          employed  any other  employee  of  Employer  for a period of three (3)
          years after  Employee's  termination of employment.  This  restriction
          applies to any type of business which Employee may enter.

6.       RELEASE.  In the event of involuntary termination, and in consideration
              for Employer's agreements hereunder, Employee agrees to execute a
              release in Favor of Employer in form and substance reasonably
              satisfactory to Employer.

7.            NOTICES.  All  notices,  consents,  changes of  address  and other
              communications (hereinafter referred to as "Notice(s)" required or
              permitted to be made under the terms of this Agreement shall be in
              writing and shall be (i)  personally  delivered by an agent of the
              relevant Party, or (ii) transmitted by postage prepaid,  certified
              or registered mail:

                                To Employer:     One Price Clothing Stores, Inc.
                                                 Post Office 2487
                                                 Spartanburg, SC  29304-2487

                                To Employee:     Thomas R. Kelly
                                                 1938 Riversand Drive
                                                 Knoxville, Tennessee 37922

8.   WAIVER OF BREACH.  The waiver of  Employer  of a breach by  Employee of any
     provision of this  Agreement  shall not operate or be construed as a waiver
     of any  subsequent  breach by Employee.  No waiver shall be valid unless in
     writing and signed by an authorized officer of Employer.

9.   ASSIGNMENT.  Employee  acknowledges  that the  services  to be  rendered by
     Employee are unique and personal. Accordingly,  Employee may not assign any
     Employee's rights or delegate any of Employee's duties or obligations under
     the Agreement.  The rights and obligations of Employer under this Agreement
     shall inure to the benefit of an all be binding upon the Employer,  and its
     successors and assigns.

10.  REPRESENTATIONS  AND  WARRANTIES.   Employee  represents  and  warrants  to
     Employer  that he is under no  obligation  to or bound by any contract with
     any person,  corporation or other entity which would prohibit or in any way
     interfere with his accepting employment with Employer or the performance of
     his duties and obligations to Employer under this Agreement.

11.  SEVERABILITY. If any provision of this Agreement as applied to either party
     or to any  circumstances  shall be  adjudged  by a court to be  invalid  or
     unenforceable,  the same shall in no way affect any other provision of this
     Agreement,  or the  application  of each  provision  to any  other  fact or
     circumstances.

12.  ENTIRE AGREEMENT,  MODIFCATION OR AMENDMENT. This Agreement constitutes the
     entire  agreement  of the parties  with  respect to its subject  matter and
     supersedes  all prior oral or written  agreements.  This  Agreement  may be
     modified  or  amended  from  time to time by the  mutual  agreement  of the
     parties  hereto.  No  modification  or amendment of this Agreement shall be
     binding upon either party unless it is in writing and executed by the party
     sought to be charged.

13.  COUNTERPARTS.  This Agreement may be executed in one or more  counterparts,
     all of which taken together shall constitute one instrument.

14.  CAPTIONS.  The  captions  contained  in this  Agreement  are for  reference
     purposes only and shall not affect in any way the meaning or interpretation
     of this Agreement.

15.  GOVERNING  LAW.  This  Agreement  shall be  governed  by and  construed  in
     accordance  with the laws of the State of South  Carolina,  without  giving
     effect to South Carolina's rules of conflicts of law, and regardless of the
     place or places of its physical execution and performance.

16.           ENFORCEMENT.  This  Agreement  may only be  enforced in a court of
              competent  jurisdiction  in Spartanburg  County,  South  Carolina.
              Employee  agrees  to  submit  to the  jurisdiction  of a court  of
              competent  jurisdiction  in Spartanburg  County,  South  Carolina,
              whether or not then  residing in South  Carolina.  The  prevailing
              party shall be  entitled to recover  from the other party the cost
              of any court action, including reasonable attorney's fees.

17.      "Executive Officer" Status - Employee understands that as the Senior
              Vice  President  and GMM for  Employer,  he will be  considered an
              "Executive  Officer" of the Company,  and accordingly will need to
              file a Form  S-3  upon  commencement  of his  employment.  In this
              respect, as an Executive Officer,  Employee will be subject, among
              other things,  to the requirements of Section 16 of the Securities
              Exchange Act of 1934, including the ongoing filing requirements of
              Section  16(a),  and the  insider  trading  provisions  of Section
              16(b).

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

         Witnesses:                              One Price Clothing Stores, Inc.


         /s/ Diana Hardin                           By:/s/ Larry I. Kelley
         As to Employer                                 Larry I. Kelley
                                                        President & Chief
                                                        Executive Officer
                                                        "EMPLOYER"


         /s/ Charles E. Jackett                      By:/s/ Thomas R. Kelly
         As to Employee                                 Thomas R. Kelly
                                                        "Employee"




         ______________(Seal)
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</DOCUMENT>
