Exhibit No. 10.9

BONUS AGREEMENT

Agreement made as of the 22nd day of August, 2005, between UNITED RETAIL
INCORPORATED, a Delaware corporation, with principal offices at 365 West Passaic
Street, Rochelle Park, New Jersey 07662-6563 (the “Company”) and ROSE PANICALI
residing at 3 Colts Run, Marlboro, New Jersey 07746 (the “Executive”).

WHEREAS, the Executive has been hired by the Company as its Vice
President/GMM-AVENUE BODY®; and

WHEREAS, the Company desires to give the Executive an incentive to increase
sales of body merchandise, on the terms set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and obligations
hereinafter set forth, the parties hereto, intending to be legally bound, hereby
agree as follows:

1. Definitions.

“Body Merchandise” shall mean merchandise sold by the Company for the following
departments: sleepwear, hosiery, panties, bras and shapewear.

“Margin Dollars” shall mean selling margin dollars (margin dollars without
vendor allowance) per average store from sales in any period of two consecutive
six-month seasons (a “Measuring Period”) of Body Merchandise determined by the
Chief Financial Officer of the Company, whose determination shall be final and
binding on the Executive and the Company.

“Protected Information” shall mean trade secrets, confidential or proprietary
information, and all other knowledge, know-how, information, documents or
materials, owned or developed by the Company, or otherwise in the possession of
the Company, whether in tangible or intangible form, pertaining to the business
of the Company, the Confidentiality of which the Company takes reasonable
measures to protect, including, but not limited to, the Company’s research and
development operations, identities and habits of customers and prospective
customers, suppliers, business relationships, products (including prices, costs,
sales or content), processes, techniques, contracts, financial information or
measures, business methods, future business plans, data bases, operating
procedures, knowledge of the organization, and other information owned,
developed or possessed by the Company; provided, however, that Protected
Information shall not include information that shall become generally known to
the public or the trade without violation of Section 5.

“Term” shall mean the period ending on August 1, 2010.

“Unauthorized” shall mean: (i) in contravention of the Company’s policies or
procedures; (ii) otherwise inconsistent with the Company’s measures to protect
its interests in its Protected Information; or (iii) in contravention of any
duty existing under law or contract.

2.

Representation, Warranty and Covenant of Executive. The Executive represents,
warrants and covenants to the Company that she is not and will not become a
party to any agreement, contract or understanding, whether employment or
otherwise, which would in any way restrict or prohibit her from undertaking or
performing her employment.

3.

Representation, Warranty and Covenant of the Company. The Company represents and
warrants that this Agreement constitutes a valid and legally binding obligation
of the Company enforceable in accordance with the terms herein set forth, except
to the extent that the enforceability of this Agreement may be affected by
bankruptcy, insolvency, reorganization, moratorium, or similar laws or equitable
principles affecting creditors’ rights generally.

4.

Super Bonus Compensation.

 a. Subject to the provisions of paragraph (b) below and in addition to bonus
    payments that may otherwise be earned pursuant to the Incentive Compensation
    Program as in effect from time to time, the Executive shall be paid the
    following cash bonuses, subject to strict satisfaction of the following
    conditions:

        (i) if Margin Dollars during a relevant Measuring Period before the end
of the Term exceed:

            (A) $80,000, then the Executive shall be paid a one-time bonus of
$100,000;

            (B) $100,000, then the Executive shall be paid an additional
one-time bonus of $100,000; and

            (C) $120,000, then the Executive shall be paid a third one-time
bonus of $100,000 (the maximum total of all bonuses combined being $300,000);

        (ii) at all times from the date of this Agreement to the end of the
applicable Measuring Period and for three months thereafter the Executive shall
have been employed by the Company and shall have been either at work, on
vacation or receiving temporary disability benefits for a condition other than
Permanent Disability ("Employed");

 b. Paragraph (a) above to the contrary notwithstanding, in the event of an
    Acquisition or Merger, the parties shall negotiate in good faith to adjust
    the target Margin Dollars appropriately.
 c. Each bonus shall be payable, without interest, three months after the end of
    the applicable Measuring Period.

5.     Restrictive Covenants and Confidentiality.

 a. The Executive agrees that she shall not solicit, raid, entice, encourage or
    induce any person who at any time within one year prior thereto shall have
    been an employee of the Company to become employed by any person, firm or
    corporation, and the Executive shall not approach any such employee for such
    purpose or authorize or knowingly approve the taking of such actions by any
    other person, firm or corporation or assist any such person, firm or
    corporation in taking such action. The Executive shall be bound by the
    provisions of Section 5(a), and shall perform her obligations pursuant to
    Section 5(a), during her employment and for 12 months thereafter.
 b. During her employment and thereafter, the Executive will not use, disclose
    or divulge, furnish or make accessible to anyone, directly or indirectly,
    any Protected Information in any Unauthorized manner or for any Unauthorized
    purpose, provided, however, that in the event that the Executive is required
    to disclose any Protected Information by court order or decree or in
    compliance with the rules and regulations of a governmental agency or in
    compliance with law, the Executive will provide the Company with prompt
    notice of such required disclosure so that the Company may seek an
    appropriate protective order and/or waive the Executive's compliance with
    the provisions of this Section 5 and provided, further, that if, in the
    absence of a protective order or the receipt of a waiver hereunder, the
    Executive is advised by her counsel that such disclosure is necessary to
    comply with such court order, decree, rule, regulation or law, she may
    disclose such information without liability hereunder.
 c. The Executive agrees that all processes, techniques, know-how, inventions,
    plans, products, and devices developed, made or invented by the Executive,
    alone or with others in connection with the Executive's employment
    hereunder, during her employment, shall become and be the sole property of
    the Company unless released in writing by the Company.
 d. The provisions of this Section 5 shall survive the termination of the
    Executive's employment, irrespective of the reason therefor.
 e. The Executive acknowledges that the services to be rendered by the Executive
    are of a special, unique and extraordinary character and, in connection with
    such services, the Executive will have access to confidential information
    vital to the Company's business. By reason of this, the Executive consents
    and agrees that if the Executive violates any of the provisions of this
    Section 5, the Company would sustain irreparable harm and, and therefore, in
    addition to any other remedies which the Company may have under this
    Agreement or otherwise, the Company shall be entitled to an injunction from
    any court of competent jurisdiction restraining the Executive from
    committing or continuing any such violation of this Section 5. The Executive
    acknowledges that damages at law would not be an adequate remedy for
    violation of this Section 5, and the Executive therefore agrees that the
    provisions of this Section 5 may be specifically enforced against the
    Executive in any court of competent jurisdiction. Nothing herein shall be
    construed as prohibiting the Company from pursuing any other remedies
    available to the Company for such breach or threatened breach, including the
    recovery of damages from the Executive.

6.

Deductions and Withholding. The Executive agrees that the Company shall withhold
from bonuses all Federal, state, local and/or other taxes which the Company
determines are required to be withheld in accordance with applicable statues
and/or regulations from time to time in effect.

7.

Mutual Non-Disparagement. Neither the Executive nor the Company will make or
authorize any public statement disparaging the other in its or her business
interests and affairs. Notwithstanding the foregoing, neither party shall be (i)
required to make any statement which it or she believes to be false or
inaccurate, or (ii) restricted in connection with any litigation, arbitration or
similar proceeding or with respect to its response to any legal process. The
provisions of this Section 7 shall survive the termination of the Executive’s
employment, irrespective of the reason therefor.

8.

Governing Law. This Agreement shall be subject to, and governed by, the internal
laws of the State of New Jersey.

9.

Assignability. The Executive may not, without the Company’s written consent
thereto, assign, transfer, convey, pledge, encumber, hypothecate or otherwise
dispose of this Agreement or any interest herein. Any such attempted delegation
or disposition shall be null and void ab initio and without effect.

10.

Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be delivered personally or sent by registered or
certified mail, return receipt requested, to the other party hereto at her or
its address as set forth at the beginning of this Agreement and, in the case of
the Company, addressed to the attention of its General Counsel. Either party may
change the address to which notices, requests, demands and other communications
hereunder shall be sent by sending written notice of such change of address to
the other party.

11.

“At Will” Employment. This Agreement does not create any right to continued
employment by the Executive. Employment shall be “at will” and may be terminated
without cause at any time by the Executive or by the Company, without any
entitlement to future payment of the bonuses.

12.

Counterparts. This Agreement may be executed in one or more counterparts, which
shall collectively and separately, constitute one agreement.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement in
multiple originals.

      UNITED RETAIL INCORPORATED
By: /s/ RAY BROWN
Ray Brown
Title: Vice President-Associate Services
 
/s/ ROSE PANICALI
Rose Panicali