EXHIBIT 10.3















                               CHARMING SHOPPES on
                     VARIABLE DEFERRED COMPENSATION PLAN on
                                FOR EXECUTIVES on

                             Amended and Restated on

                         Effective December 23, 2003 on













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                                CHARMING SHOPPES
                       VARIABLE DEFERRED COMPENSATION PLAN
                                 FOR EXECUTIVES

                              Amended and Restated

                           Effective December 23, 2003


                                TABLE OF CONTENTS


Article 1         Preamble.................................................. 1
Article 2         Definitions............................................... 2
Article 3         Administration of the Plan................................ 8
Article 4         Participation............................................. 9
Article 5         Distribution Option Accounts..............................12
Article 6         Distribution Options......................................13
Article 7         Benefits to Participants..................................14
Article 8         Disability................................................16
Article 9         Survivor Benefits.........................................17
Article 10        Emergency Benefit.........................................18
Article 11        Accelerated Distribution..................................18
Article 12        Miscellaneous.............................................19
Article 13        Signature.................................................23











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                                CHARMING SHOPPES
                       VARIABLE DEFERRED COMPENSATION PLAN
                                 FOR EXECUTIVES

                              Amended and Restated

                           Effective December 23, 2003

                                    ARTICLE 1

                                    Preamble

     1.1 Purpose. The purpose of the Charming Shoppes Variable Deferred
Compensation Plan for Executives (the "Plan") is to provide a means whereby
Charming Shoppes, Inc. (hereinafter referred to as the "Company" or "Charming
Shoppes") may afford increased financial security, on a tax-favored basis, to a
select group of key management employees of the Company who have rendered and
continue to render valuable services to the Company which constitute an
important contribution towards the Company's continued growth and success, by
providing for additional future compensation so that such employees may be
retained and their productive efforts encouraged.

     1.2 Amended and Restated Plan. The Company hereby amends and restates the
Plan, effective December 23, 2003, to permit certain executive employees of the
Company to defer the receipt of all or a portion of the Company Stock (as
defined below) that they would otherwise receive upon the lapse of the
restrictions applicable to the restricted stock awards made to such employees
under the Company's 1993 Employees Stock Incentive Plan, 1999 Associates Stock
Incentive Plan and 2000 Associates Stock Incentive Plan. The Plan was previously
amended and restated effective January 1, 2002, to allow Eligible Employees (as
defined below), who were participants under the Limited, Inc. Alternate Savings
Plan (the "Limited Plan") and the Lane Bryant, Inc. Supplemental Retirement and
Deferred Compensation Plan (the "Lane Bryant Plan"), to consolidate their prior
balances under such plans and have such balances credited to a Retirement
Distribution Account under this Plan which shall: (a) earn a fixed annual rate
of interest as respectively provided for such balances under the Limited Plan
and/or the Lane Bryant Plan as in effect on December 31, 2001 (the "Fixed
Rate"); and (b) be segregated for purposes of Article V from any new deferrals
under this Plan, and credited only with that interest rate. In addition, the
Lane Bryant Plan was merged with and into the Plan, effective as of January 1,
2002. Any such individual who is or becomes an Eligible Employee on or after
December 23, 2003, and who wishes to participate in the Plan, shall be subject
to the terms and conditions as set forth herein on or after that date.




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                                    ARTICLE 2

                                   Definitions

     For ease of reference, the following definitions will be used in the Plan:

     2.1 Affiliate. "Affiliate" means any firm, partnership, or corporation that
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with the Company. "Affiliate" also
includes any other organization similarly related to the Company that is
designated as such by the Board.

     2.2 Base Salary. "Base Salary" means with respect to a Participant for any
Plan Year such Participant's annual base salary, before deferral pursuant to
this Plan or any agreement or any other plan of the Company whereby compensation
is deferred, including, without limitation, a plan whereby compensation is
deferred in accordance with Code Section 401(k) or reduced in accordance with
Code Section 125.

     2.3 Base Salary Deferral. "Base Salary Deferral" means that portion of Base
Salary as to which an Eligible Employee has made an annual irrevocable election
to defer receipt of until the date specified under the In-Service Distribution
Option and/or the Retirement Distribution Option.

     2.4 Beneficial Owner, Beneficially Owns and Beneficial Ownership.
"Beneficial Owner, Beneficially Owns and Beneficial Ownership" shall have the
meanings ascribed to such terms for purposes of Section 13(d) of the Securities
Exchange Act of 1934 (the "Exchange Act") and the rules thereunder, except that,
for purposes of this definition, "Beneficial Ownership" (and the related terms)
shall include Voting Securities that a Person has the right to acquire pursuant
to any agreement, or upon exercise of conversion rights, warrants, options or
otherwise, regardless of whether any such right is exercisable within 60 days of
the date as of which Beneficial Ownership is to be determined.

     2.5 Beneficiary. "Beneficiary" means the person or persons designated as
such in accordance with Section 12.3.

     2.6 Board. "Board" means the Board of Directors of Charming Shoppes.

     2.7 Bonus Compensation. "Bonus Compensation" means with respect to a
Participant for any Plan Year such Participant's annual bonus compensation
before deferral pursuant to this Plan or any agreement or any other plan of the
Company whereby compensation is deferred, including, without limitation, a plan
whereby compensation is deferred in accordance with Code Section 401(k) or
reduced in accordance with Code Section 125. "Bonus Compensation" also means
with respect to a Participant for any Plan Year such Participant's award from
the Charming Shoppes, Inc. Long-Term Incentive Program before deferral pursuant
to this Plan.




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     2.8 Bonus Compensation Deferral. "Bonus Compensation Deferral" means that
portion of Bonus Compensation as to which an Eligible Employee has made an
annual irrevocable election to defer receipt of until the date specified under
the In-Service Distribution Option and/or the Retirement Distribution Option.
"Bonus Compensation Deferral" also means that portion of Bonus Compensation
attributable to an award from the Charming Shoppes, Inc. Long-Term Incentive
Program as to which an Eligible Employee has made an irrevocable election, prior
to the end of the second fiscal year within the performance period attributable
to such award, or such other time as determined by the Committee, to defer
receipt of until the date specified under the In-Service Distribution Option
and/or the Retirement Distribution Option.

     2.9 Break in Service. "Break in Service" means a Plan Year during which a
Participant is not credited with more than 500 Hours of Service.

     2.10 Change of Control. "Change of Control" means and shall be deemed to
have occurred if:

                  (a) any Person, other than the Company or a Related Party,
acquires directly or indirectly the Beneficial Ownership of any Voting Security
and immediately after such acquisition such Person has, directly or indirectly,
the Beneficial Ownership of Voting Securities representing 20 percent or more of
the total voting power of all the then-outstanding Voting Securities; or

                  (b) those individuals who as of the day after the Charming
Shoppes' annual shareholders meeting in the Plan Year prior to the determination
constitute the Board or who thereafter are elected to the Board and whose
election, or nomination for election, to the Board was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors as of the day after the Charming Shoppes' annual shareholders meeting
in the Plan Year prior to the determination or whose election or nomination for
election was previously so approved, cease for any reason to constitute a
majority of the members of the Board ; or

                  (c) the shareholders of Charming Shoppes approve a merger,
consolidation, recapitalization or reorganization of Charming Shoppes, a reverse
stock split of outstanding Voting Securities, or an acquisition of securities or
assets by Charming Shoppes (a "Transaction"), or consummation of such a
Transaction if shareholder approval is not obtained, other than a Transaction
which would result in the holders of Voting Securities having at least 80
percent of the total voting power represented by the Voting Securities
outstanding immediately prior thereto continuing to hold Voting Securities or
voting securities of the surviving entity having at least 60 percent of the
total voting power represented by the Voting Securities or the voting securities
of such surviving entity outstanding immediately after such transaction and in
or as a result of which the voting rights of each Voting Security relative to
the voting rights of all other Voting Securities are not altered; or

                  (d) the shareholders of Charming Shoppes approve a plan of
complete liquidation of Charming Shoppes or an agreement for the sale or
disposition by Charming Shoppes of all or substantially all of Charming Shoppes'
assets other than any such transaction



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which would result in Related Parties owning or acquiring more than 50 percent
of the assets owned by Charming Shoppes immediately prior to the transaction.

     2.11 Code. "Code" means the Internal Revenue Code of 1986, as amended from
time to time.

     2.12 Committee. "Committee" means the persons appointed by the Company to
administer the Plan.

     2.13 Company. "Company" means Charming Shoppes and any Affiliate which is
authorized by the Board to adopt the Plan and cover its Eligible Employees and
whose designation as such has become effective upon acceptance of such status by
the board of directors of the Affiliate. An Affiliate may revoke its acceptance
of such designation at any time, but until such acceptance has been revoked, all
the provisions of the Plan and amendments thereto shall apply to the Eligible
Employees of the Affiliate. In the event the designation is revoked by the board
of directors of an Affiliate, the Plan shall be deemed terminated only with
respect to such Affiliate.

     2.14 Company Stock. "Company Stock" means shares of common stock of
Charming Shoppes, Inc.

     2.15 Disabled. "Disabled" means a mental or physical condition which
qualifies a Participant for benefits under the Charming Shoppes Long Term
Disability Plan.

     2.16 Distribution Option. "Distribution Option" means the two distribution
options which are available under the Plan, consisting of the Retirement
Distribution Option and the In-Service Distribution Option.

     2.17 Distribution Option Account. "Distribution Option Account" or
"Accounts" means, with respect to a Participant, the Retirement Distribution
Account and/or the In-Service Distribution Account established on the books of
account of the Company, pursuant to Section 5.1, for each Distribution Option
Period.

     2.18 Distribution Option Period. "Distribution Option Period" means a
period of four Plan Years for which an Eligible Employee elects, in the
Enrollment Agreement, the time and manner of payment of amounts credited to the
Eligible Employee's Distribution Option Accounts for such Plan Years.

     2.19 Earnings Crediting Options. "Earnings Crediting Options" means the
options selected by the Participant from time to time pursuant to which earnings
are credited to the Participant's Distribution Option Accounts.

     2.20 Effective Date. "Effective Date" means the effective date of the Plan
which is December 1, 1997, as amended and restated effective December 23, 2003.



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     2.21 Eligible Employee. "Eligible Employee" means an Employee who is a
member of the group of selected management and/or highly compensated Employees
of the Company designated by the Company's Chief Executive Officer as eligible
to participate in the Plan.

     2.22 Employee. "Employee" means any person employed by the Company on a
regular full-time salaried basis or who is an officer of the Company.

     2.23 End Termination Date. "End Termination Date" means the date of
termination of a Participant's Service with the Company and its Affiliates.

     2.24 Enrollment Agreement. "Enrollment Agreement" means the authorization
form which an Eligible Employee files with the Committee to participate in the
Plan.

     2.25 Equity Plans. "Equity Plans" means the Company's 1993 Employees Stock
Incentive Plan, 1999 Associates Stock Incentive Plan and 2000 Associates Stock
Incentive Plan and any similar plan adopted by the Company after the Effective
Date.

     2.26 Excess Compensation. "Excess Compensation" means amounts of Base
Salary and Bonus Compensation equal to the excess, if any, of (a) the sum of the
Participant's Base Salary and Bonus Compensation minus the amount of deferrals
under this Plan over (b) the maximum amount of compensation permitted to be
taken into account under the terms of the Savings Plan.

     2.27 Fair Market Value. "Fair Market Value" means: (i) if the Company Stock
is publicly traded, then the Fair Market Value per share shall be determined as
follows: (A) if the principal trading market for the Company Stock is a national
securities exchange or the Nasdaq National Market, the last reported sale price
thereof on the relevant date or (if there were no trades on that date) the
latest preceding date upon which a sale was reported, or (B) if the Company
Stock is not principally traded on such exchange or market, the mean between the
last reported "bid" and "asked" prices of Company Stock on the relevant date, as
reported on Nasdaq or, if not so reported, as reported by the National Daily
Quotation Bureau, Inc. or as reported in a customary financial reporting
service, as applicable and as the Board determines; or (ii) if the Company Stock
is not publicly traded or, if publicly traded, is not subject to reported
transactions or "bid" or "asked" quotations as set forth below, the Fair Market
Value per share shall be as determined by the Committee.

     2.28 Hour of Service. "Hour of Service" means each hour for which an
Employee is directly or indirectly paid or entitled to be paid by the Company or
an Affiliate for the performance of employment duties and each hour for which
back pay, irrespective of mitigation of damages, has been either awarded or
agreed to by the Company or an Affiliate. These hours shall be credited to an
Employee for the computation period during which his or her employment duties
were performed or to which a back pay agreement or award pertains irrespective
of when payment is made. No Employee shall be credited with duplicate Hours of
Service as a result of a back pay agreement or award. An Employee shall also be
credited with one Hour of Service for each hour for which the Employee is
directly or indirectly paid, or entitled to payment, by the Company or an
Affiliate on account of a period during which no duties are performed due to
vacation, holiday, illness, incapacity, disability, layoff, jury duty or Leave
of Absence; provided,


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however, that not more than 501 Hours of Service shall be credited to an
Employee under this sentence on account of any single, continuous period during
which the Employee performs no duties, and provided further that no credit shall
be given if payment is made or due under a plan maintained solely for the
purpose of complying with applicable workers' compensation, unemployment
compensation or disability insurance laws, or is made solely to reimburse an
Employee for medical or medically related expenses incurred by the Employee.

                  (a) For purposes of determining the number of Hours of Service
completed in any applicable computation period, the Committee may maintain
accurate records of actual hours completed for all Employees. The number of
Hours of Service to be credited to an Employee for periods during which no
employment duties are performed shall be determined in accordance with sections
2530.200b-2(b) and 2530.200b-2(c) of the Department of Labor regulations in
Title 29 of the Code of Federal Regulations.

                  (b) If the Committee does not maintain records of actual Hours
of Service, an Employee shall be credited with 45 Hours of Service for each week
in which such Employee would otherwise be credited with at least one Hour of
Service.

                  (c) Solely for the purpose of preventing a Break in Service,
an Employee shall be credited with Hours of Service during an absence by reason
of:

                      (i)      the pregnancy of the Employee;

                      (ii)     the birth of a child of the Employee;

                      (iii)    the  placement  of a child with the Employee in
connection  with the adoption of such child by the Employee; or

                      (iv)     for purposes of caring for a child beginning
immediately after such birth or placement;

provided the Employee shall, during the period of his or her absence, be
credited with the number of Hours of Service which would have been credited to
him at his or her normal work rate but for such absence, or, if the number of
Hours of Service based on a normal rate is indeterminable, the Employee shall be
credited with eight Hours of Service per day of such absence. Notwithstanding
the foregoing, the Employee shall be credited with no more than 501 Hours of
Service during said absence. These hours shall be credited to the Break in
Service computation period in which the absence began if necessary to avoid a
Break in Service or, if not necessary, then to the following computation period.
The Employee shall be responsible for reporting to the Committee any Hours of
Service that are to be credited under this Section 2.25. Nothing contained in
the Section shall be deemed to expand or extend any maternity or paternity leave
policy of the Company or an Affiliate.




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     2.29 In-Service Distribution Account. "In-Service Distribution Account"
means the Account maintained for a Participant for each Distribution Option
Period to which Base Salary Deferrals and/or Bonus Compensation Deferrals and
Company Matching Contributions are credited pursuant to the In-Service
Distribution Option.

     2.30 In-Service Distribution Option. "In-Service Distribution Option" means
the Distribution Option pursuant to which benefits are payable in accordance
with Section 7.2.

     2.31 Leave of Absence. "Leave of Absence" means any temporary absence from
employment authorized by the Company or an Affiliate based on its normal
practices.

     2.32 Matching Contributions. "Matching Contributions" are those credited to
a Participant's Distribution Option Accounts by the Company pursuant to Section
4.4.

     2.33 Matching Units. "Matching Units" are those credited to a Participant's
Distribution Option Accounts by the Company pursuant to Section 4.6.

     2.34 Participant. "Participant" means an Eligible Employee who has filed a
completed and executed Enrollment Agreement with the Committee or its designee
and is participating in the Plan in accordance with the provisions of Article 4.

     2.35 Person. "Person" shall have the meaning ascribed for purposes of
Section 13(d) of the Exchange Act and the rules thereunder.

     2.36 Plan. "Plan" means this plan, called the Charming Shoppes Variable
Deferred Compensation Plan for Executives, as amended from time to time.

     2.37 Plan Year. "Plan Year" means the 12 month period beginning on each
January 1 and ending on the following December 31 except that the first Plan
Year shall begin on the Effective Date.

     2.38 Related Party. "Related Party" means (a) a majority-owned subsidiary
of Charming Shoppes; or (b) a trustee or other fiduciary holding securities
under an employee benefit plan of Charming Shoppes or any majority-owned
subsidiary of Charming Shoppes; or (c) a corporation owned directly or
indirectly by the shareholders of Charming Shoppes in substantially the same
proportion as their ownership of Voting Securities.

     2.39 Retirement. "Retirement" means the termination of the Participant's
Service with the Employer (for reasons other than death) at or after age 65, or,
if the Participant has 10 or more years of Service, at or after age 55.

     2.40 Retirement Distribution Account. "Retirement Distribution Account"
means the Account maintained for a Participant for each Distribution Option
Period to which Base Salary Deferrals and/or Bonus Compensation Deferrals and
Company Matching Contributions are credited pursuant to the Retirement
Distribution Option.



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     2.41 Retirement Distribution Option. "Retirement Distribution Option" means
the Distribution Option pursuant to which benefits are payable in accordance
with Section 7.1.

     2.42 Savings Plan. "Savings Plan" means the Company's Employees' Retirement
Savings Plan.

     2.43 Service. "Service" means the period of time during which an employment
relationship exists between an Employee and the Company, including any period
during which the Employee is on an approved leave of absence, whether paid or
unpaid. "Service" also includes employment with an Affiliate if an Employee
transfers directly between the Company and the Affiliate.

     2.44 Vesting or Vested. "Vesting" or "Vested" refers to the permanent
ownership rights to the Matching Contributions that a Participant earns through
Years of Service. A Participant does not fully vest until after six Years of
Service. A Participant shall be Vested in 20% of the Matching Contribution after
2 Years of Service and 20% for each Year of Service in excess of two, after
which the Participant will be 100% Vested in the Matching Contributions.
Matching Contributions and related earnings are forfeited when service
terminates, to the extent not then Vested. A Participant is automatically 100%
Vested if the Participant becomes Disabled or dies. A Participant is always 100%
Vested in Base Salary Deferrals, Bonus Compensation Deferrals, and related
earnings. Notwithstanding the foregoing, effective January 1, 2003, a
Participant shall be 100% Vested in his Matching Contributions upon attainment
of age 65.

     2.45 Voting Securities. "Voting Securities" means any securities of
Charming Shoppes which carry the right to vote generally in the election of
directors.

     2.46 Year of Service. A "Year of Service" for Vesting purposes is a
calendar year during which a Participant is credited with 1,000 Hours of
Service. If a Participant incurs a Break in Service, his Years of Service before
that Break in Service (and not disregarded by reason of any prior Break in
Service) shall be taken into account only if following the Break in Service the
Participant completes one Year of Service, and:

          (a) before the Break in Service the Participant had a Vested interest
in his or her accrued benefits under the Plan; or

          (b) the aggregate number of the Participant's consecutive Breaks in
Service is less than five.

                                    ARTICLE 3

                           Administration of the Plan

     3.1 Committee. The Committee is hereby authorized to administer the Plan
and establish, adopt, or revise such rules and regulations as it may deem
necessary or advisable for the administration of the Plan. The Committee shall
have discretionary authority to construe and interpret the Plan, to make
determinations, including factual determinations, and to determine the rights,
if any, of Participants and Beneficiaries under the Plan. The Committee's
resolution of


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any matter concerning the Plan shall be final and binding upon any Participant
and Beneficiary affected thereby. Members of the Committee shall be eligible to
participate in the Plan while serving as members of the Committee, but a member
of the Committee shall not vote or act upon any matter which relates solely to
such member's interest in the Plan as a Participant.

                                    ARTICLE 4

                                  Participation

     4.1 Election to Participate. Annually, all Eligible Employees will be
offered the opportunity to defer compensation to be earned in the following Plan
Year. Any Eligible Employee may enroll in the Plan effective as of the first day
of a Plan Year by filing a completed and fully executed Enrollment Agreement
with the Committee prior to the end of the first quarter of such Plan Year;
provided, however, that the Eligible Employee's Base Salary Deferral shall be
effective prospectively only from the first payroll period of the Company next
following receipt of the Enrollment Agreement. In addition, during any Plan
Year, an Eligible Employee may make a one-time election to completely defer
compensation; provided, however, that such an election shall be effective for
the balance of the current Plan Year and the next following full Plan Year. Such
election shall be in writing in such form, and at such time, as the Committee
directs. Pursuant to said Enrollment Agreement, the Eligible Employee shall
irrevocably elect (a) the percentages, in whole percentages, by which up to 77%
of Base Salary (80% in the case of Excess Compensation) or up to 100% of Bonus
Compensation (in each case after required payroll tax deductions) of such
Eligible Employee for the Plan Year will be deferred, and (b) the Distribution
Option Accounts to which such amounts will be credited, and shall provide such
other information as the Committee shall require. The first Enrollment Agreement
filed by an Eligible Employee during any Distribution Option Period must also
set forth the Participant's election as to the time and manner of distribution
from the In-Service Distribution Account and the Retirement Distribution Account
of amounts credited for that Distribution Option Period and related earnings.
Notwithstanding anything in this Plan to the contrary, any election by a
Participant to defer Base Salary or Bonus Compensation for any Plan Year by less
than 2%, or such other amount as the Committee may determine from time to time,
shall not be given effect. Participation in the Plan shall be made conditional
upon an Eligible Employee's acknowledgement, in writing, that all decisions and
determinations of the Committee shall be final and binding on the Eligible
Employee, his beneficiaries, and any other person having or claiming an interest
under the Plan.

     4.2 Acknowledgement of Committee's Authority. A Participant's execution of
the Enrollment Agreement shall also constitute acknowledgment that all
decisions, interpretations and determinations by the Committee shall be final
and binding on the Company, Participants, Beneficiaries and any other persons
having or claiming an interest thereunder.

     4.3 New Eligible Employees. The Committee may, in its discretion, permit
Employees who first become Eligible Employees after the beginning of a Plan Year
to enroll in the Plan for that Plan Year by filing a completed and fully
executed Enrollment Agreement, in accordance with Section 4.1, as soon as
practicable following the date the Employee becomes an Eligible Employee but, in
any event, within 30 days after such date. Notwithstanding the


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foregoing, however, any election by an Eligible Employee, pursuant to this
section, to defer Base Salary and/or Bonus Compensation shall apply only to such
amounts as are earned by the Eligible Employee after the date on which such
Enrollment Agreement is filed.

     4.4 Matching Contributions. An Eligible Employee who elects to participate
in the Plan pursuant to Section 4.1 and/or Section 4.3 shall be eligible to
receive Matching Contributions by the Company if, and only when, such Eligible
Employee is eligible to receive matching contributions under the Savings Plan.
The amount of such Matching Contributions for a Plan Year shall be 1 1/2% of the
Base Salary Deferral and Bonus Compensation Deferral to the extent that any such
deferral relates to compensation less than or equal to the maximum amount of
compensation permitted to be taken into account under the terms of the Savings
Plan and 50% of the Base Salary Deferrals and Bonus Compensation Deferrals made
under this Plan to the extent that such deferrals do not exceed 3% of Base
Salary and Bonus Compensation; provided, however, that the Matching
Contributions shall equal 50% of the Base Salary Deferrals and Bonus
Compensation Deferrals made under the Plan to the extent the deferrals relate to
Excess Compensation and to the extent that such deferrals do not exceed 6% of
Base Salary and Bonus Compensation. Matching Contributions will be credited to
the Distribution Option Account to which the matched Base Salary or Bonus
Compensation Deferrals are credited. Matching Contributions will be credited as
frequently as determined by the Committee, acting on behalf of the Company, but
in any event at least once per year. Matching Contributions will be credited as
soon as practicable in the Participant's final year of Participation.

     4.5 Transfer of Limited Plan or Lane Bryant Plan Balances. Notwithstanding
the above, an Eligible Employee, who was a participant under the Limited Plan
and/or the Lane Bryant Plan, shall have his or her prior balances under such
plans, if any, consolidated and credited to the Retirement Distribution Account,
and the Fixed Rate thereafter applied to such balances. Such a Participant's
deferrals on or after January 1, 2002 shall not be credited with the Fixed Rate
but shall be subject to the provisions of Article V.

     4.6 Company Stock Deferrals.

     (a) Eligibility. The Company, in its sole and absolute discretion, may
permit selected Eligible Employees to elect to defer all or a portion of the
shares of Company Stock that they would otherwise receive upon the lapse of
restrictions applicable to the restricted stock awards made to such Eligible
Employees under one or more of the Equity Plans. Unless otherwise permitted by
the Committee and specifically communicated to the Eligible Employee, Company
Stock may only be deferred into a Retirement Distribution Account.

     (b) Form and Timing of Election. An election to defer Company Stock must be
made no later than the last day of the calendar year prior to the calendar year
in which the restrictions applicable to such Company Stock would otherwise
lapse. An Eligible Employee may make an election by filing a completed and fully
executed Enrollment Agreement with the Committee. In no event may an Eligible
Employee change his election to defer receipt of all or part of his Company
Stock once made, and such election shall be irrevocable.




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<PAGE>


     (c) Deferral of Company Stock. Upon receipt by the Committee of an Eligible
Employee's completed and executed Enrollment Form, the number of shares of
Company Stock that the Eligible Employee elected to defer shall be cancelled and
the Company shall credit the Eligible Employee's Distribution Option Accounts
with a number of units equal to the number of shares of Company Stock the
Eligible Employee elected to defer.

     (d) Matching Units. For every share of Company Stock an Eligible Employee
elects to defer that, when aggregated with all other compensation payable to the
Eligible Employee for the fiscal year, would have otherwise been in excess of
the limitation under Code section 162(m) (the "162(m) limit"), the Company shall
credit to such Eligible Employee's Distribution Option Account a unit equivalent
to two-tenths of a share of Company Stock such that for every five shares of
Company Stock an Eligible Employee elects to defer (but only to the extent that
such shares would have otherwise caused the Eligible Employee's compensation to
exceed the 162(m) limit), the Company shall credit a number of units equivalent
to one whole share of Company Stock to such Eligible Employee's Distribution
Option Accounts. Matching Units shall be credited to an Eligible Employee's
Distribution Option Accounts as of the last day of the fiscal year of the
Company in which the restrictions applicable to the Company Stock would have
otherwise lapsed (and would have resulted in a taxable event to the Eligible
Employee but for the deferral), after it is determined whether and to what
extent an Eligible Employee's compensation would have exceeded the 162(m) limit
had no deferral of Company Stock been made.

(e) Vesting. The units credited to an Eligible Employee's Distribution Option
Accounts (including any Matching Units) shall be subject to the vesting
requirements set forth in the applicable Equity Plan and the restricted stock
agreement governing the Company Stock deferred by the Eligible Employee under
the applicable Equity Plan.

(f) Dividends. If dividends are declared with respect to shares of Company
Stock, the amount of the dividend that would have been distributed with respect
to the units allocated to an Eligible Employee's Distribution Option Accounts,
had each such whole unit been a share of Company Stock, shall be converted into
additional units based on the Fair Market Value of the Company Stock on the date
the dividend is paid. The additional units shall be credited to an Eligible
Employee's Distribution Option Accounts as of the date the dividends are paid.
All units attributable to dividends shall become vested, or shall be forfeited,
according to the vesting of the units to which they relate.

(g) Distribution. Distribution shall be made in accordance with the provisions
of the Plan; provided that all distributions attributable to units representing
deferred Company Stock shall be made in Company Stock. In no event will
distribution be made until the units credited to Eligible Employee's
Distribution Option Accounts have become vested in accordance with Section
4.4(e).





                                       11
<PAGE>

                                    ARTICLE 5

                          Distribution Option Accounts

     5.1 Distribution Option Accounts. The Committee shall establish and
maintain separate Distribution Option Accounts with respect to a Participant for
each Distribution Option Period. A Participant's Distribution Option Accounts
shall consist of the Retirement Distribution Account and/or the In-Service
Distribution Account. The amount of Base Salary and/or Bonus Compensation
deferred pursuant to Section 4.1 or Section 4.3 shall be credited by the Company
to the Participant's Distribution Option Accounts no later than the first day of
the month following the month in which such Base Salary and/or Bonus
Compensation would otherwise have been paid, in accordance with the Distribution
Option irrevocably elected by the Participant in the Enrollment Agreement. Any
Company Stock deferred pursuant to Section 4.6 shall be credited by the Company
to the Participant's Distribution Option Accounts as of the date the shares are
deferred following the Committee's receipt of the Participant's completed and
executed Enrollment Agreement. Any amount once taken into account as Base Salary
and/or Bonus Compensation for purposes of this Plan shall not be taken into
account thereafter. Matching Contributions, when credited, are credited to the
Distribution Option Accounts in the same proportion as the Base Salary and/or
Bonus Compensation they match. The Participant's Distribution Option Accounts
shall be reduced by the amount of payments made by the Company to the
Participant or the Participant's Beneficiary pursuant to this Plan.

     5.2 Earnings on Distribution Option Accounts.

     (a) Except as provided in (b) below, a Participant's Distribution Option
Accounts shall be credited with earnings in accordance with the Earnings
Crediting Options elected by the Participant from time to time. Participants may
allocate each of their Retirement Distribution Accounts and/or In-Service
Distribution Accounts among the Earnings Crediting Options available under the
Plan only in whole percentages of not less than five (5) percent. The deemed
rate of return, positive or negative, credited under each Earnings Crediting
Option is based upon the actual investment performance of the corresponding
investment portfolios of the Hudson River Trust or EQ Advisers Trust, open-end
management investment companies under the Investment Company Act of 1940, as
amended from time to time, or such other investment fund(s) as the Company may
designate from time to time, and shall equal the total return of such investment
fund net of asset based charges, including, without limitation, money management
fees, fund expenses and mortality and expense risk insurance contract charges.
The Company reserves the right, on a prospective basis, to add or delete
Earnings Crediting Options.

     (b) The value of any units credited to an Eligible Employee's Distribution
Option Accounts in connection with the deferral of Company Stock pursuant to
Section 4.6 shall be based on the Fair Market Value of a share of Company Stock
and shall not be subject to the provisions of (a) above relating to Earnings
Crediting Options.

     5.3 Earnings Crediting Options. Except as otherwise provided pursuant to
Section 5.2, the Earnings Crediting Options available under the Plan shall
consist of options which correspond to certain investment portfolios of both the
Hudson River Trust and EQ Advisers


                                       12
<PAGE>

Trust. Notwithstanding that the rates of return credited to Participants'
Distribution Option Accounts under the Earnings Crediting Options are based upon
the actual performance of the corresponding portfolios of these Trusts, or such
other investment funds as the Company may designate, the Company shall not be
obligated to invest any Base Salary and/or Bonus Compensation deferred by
Participants under this Plan, Matching Contributions, or any other amounts, in
such portfolios or in any other investment funds.

     5.4 Changes in Earnings Crediting Options. A Participant may change the
Earnings Crediting Options to which his Distribution Option Accounts are deemed
to be allocated not more frequently than four (4) times per Plan Year. Effective
January 1, 2003, there shall be no limit to the frequency that a Participant may
change the Earnings Crediting Options to which his Distribution Option Accounts
are deemed to be allocated. Each such change may include (a) reallocation of the
Participant's existing Accounts in whole percentages of not less than five (5)
percent, and/or (b) change in investment allocation of amounts to be credited to
the Participant's Accounts in the future, as the Participant may elect.
Notwithstanding the foregoing, however, in the event the Company deletes an
Earnings Crediting Option, a Participant whose Accounts are allocated to such
Earnings Crediting Option, in whole or in part, shall be entitled to reallocate
his Distribution Option Accounts and/or any amounts to be credited in the future
to such Distribution Option Accounts among the remaining Earnings Crediting
Options, at the time of such deletion, without regard to the annual limit of
four (4) such changes.

     5.5 Valuation of Accounts. The value of a Participant's Distribution Option
Accounts as of any date shall equal the amounts theretofore credited to such
Accounts, including any earnings (positive or negative) deemed to be earned on
such Accounts in accordance with Section 5.2 through the day preceding such
date, less the amounts theretofore deducted from such Accounts.

     5.6 Statement of Accounts. The Committee shall provide to each Participant,
not less frequently than quarterly, a statement in such form as the Committee
deems desirable setting forth the balance standing to the credit of each
Participant in each of his Distribution Option Accounts.

     5.7 Distributions from Accounts. Any distribution made to or on behalf of a
Participant from one or more of his Distribution Option Accounts in an amount
which is less than the entire balance of any such Account shall be made pro rata
from each of the Earnings Crediting Options to which such Account is then
allocated.

                                    ARTICLE 6

                              Distribution Options

     6.1 Election of Distribution Option. In the first completed and fully
executed Enrollment Agreement filed with the Committee for each Distribution
Option Period, an Eligible Employee shall elect the time and manner of payment
pursuant to which the Eligible Employee's Distribution Option Accounts for that
Distribution Option Period will be distributed; provided that, unless the
Committee determines otherwise and specifically communicates such


                                       13
<PAGE>

determination to the Eligible Employee, Company Stock deferred pursuant to
Section 4.6 may only be deferred into a Retirement Distribution Account.
Annually, the Eligible Employee shall allocate his deferrals and Matching
Contributions between the Distribution Options in increments of ten percent,
provided, however that 100 percent of such deferrals and Matching Contributions
may be allocated to one or the other of the Distribution Options.

     6.2 Retirement Distribution Option. Subject to Section 7.1, distribution of
the Participant's Retirement Distribution Account for any Distribution Option
Period shall commence upon (a) the Participant's Retirement, or (b) if later,
the Participant's attainment of age 65, as elected by the Participant in the
Enrollment Agreement pursuant to which such Retirement Distribution Account was
established or otherwise as permitted under Section 7.1(a).

     6.3 In-Service Distribution Option. Subject to Section 7.2, the
Participant's In-Service Distribution Account for any Distribution Option Period
shall be distributed commencing in the year elected by the Participant in the
Enrollment Agreement pursuant to which such In-Service Distribution Account was
established. Notwithstanding the foregoing, if a Participant elects to receive a
distribution of his In-Service Distribution Account for any Distribution Option
Period commencing in a year which is within such Distribution Option Period, the
Participant shall not be entitled to allocate any additional deferrals and
Matching Contributions to such In-Service Distribution Account within two Plan
Years of the date on which such Account is distributed and such additional
deferrals during the Distribution Option Period shall instead be allocated to
the Retirement Distribution Account.

     6.4 Distribution following Change of Control. In the event that a
Participant terminates Service for any reason within two years following a
Change of Control, notwithstanding anything else in this Article 6 to the
contrary, the Participant's Distribution Option Accounts shall be distributed,
in a single lump sum, within thirty days following the date of the termination
of Service.

                                    ARTICLE 7

                            Benefits To Participants

     7.1 Benefits Under the Retirement Distribution Option. Benefits under the
Retirement Distribution Option shall be paid to a Participant as follows:

                  (a) Benefits Upon Retirement. In the case of a Participant
whose Service with the Employer terminates on account of his Retirement, the
Participant's Retirement Distribution Account with respect to any Distribution
Option Period shall be distributed in one of the following methods, as elected
by the Participant in writing either in the Enrollment Agreement or in a
separate election made prior to the date of the Participant's Retirement: (i) in
a lump sum; (ii) in 5, 10, 15, or 20 annual installments; or (iii) by any other
formula that is mathematically derived, as long as distribution is completed
within 20 years following Retirement. Any lump-sum benefit payable in accordance
with this paragraph shall be paid in, but not later than January 31, of the Plan
Year following the Plan Year in which occurs the Participant's Retirement or, if
later, attainment of age 65 as elected by the Participant in accordance with
this Section or


                                       14
<PAGE>

Section 6.2, in an amount equal to the value of such Retirement Distribution
Account as of the last business day of the Plan Year preceding the date of
payment. Annual installment payments, if any, shall commence not later than
January 31 of the Plan Year following the Plan Year in which occurs the
Participant's Retirement or if later, attainment of age 65, as elected by the
Participant in accordance with this Section or Section 6.2, in an amount equal
to (i) the value of such Retirement Distribution Account as of the last business
day of the Plan Year preceding the date of payment, divided by (ii) the number
of annual installment payments elected by the Participant in the Enrollment
Agreement pursuant to which such Retirement Distribution Account was
established. The remaining annual installments shall be paid not later than
January 31 of each succeeding Plan Year in an amount equal to (i) the value of
such Retirement Distribution Account as of the last business day of the
immediately preceding Plan Year divided by (ii) the number of installments
remaining. A Participant may change the election regarding the manner of payment
as described in Section 6.1 of the Participant's Account at any time prior to
the beginning of the Plan Year in which occurs the Participant's Retirement or
attainment of age 65, if later, and elected as the distribution date by the
Participant in accordance with Section 6.1.

                  (b) Benefits Upon Termination of Employment. In the case of a
Participant whose Service with the Employer terminates prior to the earliest
date on which the Participant is eligible for Retirement, other than on account
of becoming Disabled or by reason of death, the Vested portion of a
Participant's Retirement Distribution Account with respect to any Distribution
Option Period shall be distributed in a lump sum as soon as practicable
following the Participant's End Termination Date or attainment of age 65, as
irrevocably elected by the Participant in the Enrollment Agreement pursuant to
which such Retirement Distribution Account was established.

     7.2 Benefits Under the In-Service Distribution Option. Benefits under the
In-Service Distribution Option shall be paid to a Participant as follows:

                  (a) In-Service Distributions. In the case of a Participant who
continues in Service with the Employer, the Vested portion of a Participant's
In-Service Distribution Account for any Distribution Option Period shall be paid
to the Participant commencing no later than January 31 of the Plan Year
irrevocably elected by the Participant in the Enrollment Agreement pursuant to
which such In-Service Distribution Account was established, which may be no
earlier than the third Plan Year following the end of the last Plan Year in the
Distribution Option Period in which deferrals are to be credited to the
In-Service Distribution Account for that Distribution Option Period, in one lump
sum or in annual installments payable over 2, 3, 4, or 5 years. Any lump-sum
benefit payable in accordance with this paragraph shall be paid not later than
January 31 of the Plan Year elected by the Participant in accordance with
Section 6.3, in an amount equal to the Vested value of such In-Service
Distribution Account as of the last business day of the Plan Year preceding the
date of payment. Annual installment payments, if any, shall commence not later
than January 31 of the Plan Year as elected by the Participant in accordance
with Section 6.3, in an amount equal to (i) the Vested value of such In-Service
Distribution Account as of the last business day of the Plan Year preceding the
date of payment, divided by (ii) the number of annual installment payments
elected by the Participant in the Enrollment Agreement pursuant to which such
In-Service Distribution Account was established. The


                                       15
<PAGE>

remaining annual installments shall be paid not later than January 31 of each
succeeding year in an amount equal to (i) the Vested value of such In-Service
Distribution Account as of the last business day of the immediately preceding
Plan Year divided by (ii) the number of installments remaining. If a Participant
is not fully Vested when the In-Service Distribution Account is to be paid, the
non-Vested portion at the date of first payment will automatically be
transferred to the Retirement Distribution Account.

                  (b) Benefits Upon Termination of Employment. In the case of a
Participant whose Service with the Employer terminates prior to the date on
which the Participant's In-Service Distribution Account with respect to any
Distribution Option Period would otherwise be distributed, other than on account
of becoming Disabled or by reason of death, the Vested portion of such
In-Service Distribution Account shall be distributed either (i) in a lump sum as
soon as is practicable following the Participant's End Termination Date; (ii) in
annual installments commencing on the date such In-Service Distribution Account
would otherwise have been distributed; or (iii) in a lump sum on the date such
In-Service Distribution Account would otherwise have been distributed, all as
irrevocably elected by the Participant in the Enrollment Agreement pursuant to
which such In-Service Distribution Account was established; provided, however,
that the Company may override a Participant's election and cause a distribution
under clause (i) notwithstanding any other election by the Participant.

                                    ARTICLE 8

                                   Disability

     In the event a Participant becomes Disabled, the Participant's right to
make any further deferrals under this Plan shall terminate as of the date for
which the Participant first receives benefits under the Company's Long-Term
Disability Benefit Plan, as amended from time to time. The Participant's
Distribution Option Accounts shall continue to be credited with earnings in
accordance with Section 5.2 until such Accounts are fully distributed. For
purposes of this Plan, a Disabled Participant will not be treated as having
terminated Service. The Participant's Retirement Distribution Accounts, if any,
shall be distributed to the Participant in accordance with Section 7.1(a),
provided, however, that distribution of the Participant's Retirement
Distribution Accounts, if any, shall commence not later than January 31 of the
Plan Year immediately following the later of (a) the Plan Year in which the
Participant first becomes eligible for Retirement, or (b) the Plan Year in which
the Participant first received benefits under the Company's Long-Term Disability
Plan, as amended from time to time. The Participant's In-Service Distribution
Accounts, if any, will be distributed to the Participant in accordance with
Section 7.2(a) without regard to the fact that the Participant became Disabled.
Notwithstanding the foregoing, in no event will distribution be made with
respect to units credited to a Participant's Distribution Option Accounts
attributable to deferred Company Stock until such units are vested in accordance
with Section 4.6(e).




                                       16
<PAGE>


                                    ARTICLE 9

                                Survivor Benefits

     9.1 Death of Participant Prior to the Commencement of Benefits. In the
event of a Participant's death prior to the commencement of benefits in
accordance with Article 7, benefits shall be paid to the Participant's
Beneficiary, as determined under Section 12.3, pursuant to Section 9.2 or 9.3,
whichever is applicable, in lieu of any benefits otherwise payable under the
Plan to or on behalf of such Participant.

     9.2 Survivor Benefits Under the Retirement Distribution Option. In the case
of a Participant with respect to whom the Company has established one or more
Retirement Distribution Accounts, and who dies prior to the commencement of
benefits under such Retirement Distribution Accounts pursuant to Section 7.1,
distribution of such Retirement Distribution Accounts shall be made (a) in a
lump sum as soon as practicable following the Participant's death, or (b) in the
manner and at such time as such Retirement Distribution Accounts would otherwise
have been distributed in accordance with Section 7.1 had the Participant lived,
as elected by the Participant in the Enrollment Agreement pursuant to which such
Retirement Distribution Accounts were established or as may have been changed by
the Participant. The amount of any lump sum benefit payable in accordance with
this Section shall equal the value of such Retirement Distribution Accounts as
of the last business day of the calendar month immediately preceding the date on
which such benefit is paid. The amount of any annual installment benefit payable
in accordance with this Section shall equal (a) the value of such Retirement
Distribution Accounts as of the last business day of the calendar month
immediately preceding the date on which such installment is paid, divided by (b)
the number of annual installments remaining to be paid pursuant to the election
of the Participant in the Enrollment Agreement pursuant to which such Retirement
Distribution Accounts were established or as may have been changed by the
Participant.

     9.3 Survivor Benefits Under the In-Service Distribution Option. In the case
of a Participant with respect to whom the Company has established one or more
In-Service Distribution Accounts, and who dies prior to the date on which such
In-Service Distribution Accounts are to be paid pursuant to Section 7.2,
distribution of such In-Service Distribution Accounts shall be made (a) in a
lump sum as soon as practicable following the Participant's death, or (b) at
such time and in such form as such In-Service Distribution Accounts would
otherwise have been distributed in accordance with Section 7.2 had the
Participant lived, as irrevocably elected by the Participant in the Enrollment
Agreement pursuant to which such In-Service Distribution Accounts were
established. The amount of any lump sum benefit payable in accordance with this
Section shall equal the value of such In-Service Distribution Accounts as of the
last business day of the calendar month immediately preceding the date on which
such benefit is paid.

     9.4 Death of Participant After Benefits Have Commenced. In the event a
Participant who elected the Retirement Distribution Option for any Distribution
Option Period dies after annual installment benefits payable under Section 7.1
from one or more of the Participant's Retirement Distribution Accounts have
commenced, but before the entire balance of such


                                       17
<PAGE>

Retirement Distribution Accounts has been paid, any remaining installments shall
continue to be paid to the Participant's Beneficiary, as determined under
Section 11.3, at such times and in such amounts as they would have been paid to
the Participant had he survived.

                                   ARTICLE 10

                                Emergency Benefit

     10.1 Unforeseen Financial Emergency. In the event that the Committee, upon
written request of a Participant, determines, in its sole discretion, that the
Participant has suffered an unforeseeable financial emergency, the Company shall
pay to the Participant from the Vested portion of his Distribution Option
Account, as soon as practicable following such determination, an amount
necessary to meet the emergency, after deduction of any and all taxes as may be
required pursuant to Section 12.9 (the "Emergency Benefit"). For purposes of
this Plan, an unforeseeable financial emergency is an unexpected need for cash
arising from an illness, casualty loss, sudden financial reversal, or other such
unforeseeable occurrence. Cash needs arising from foreseeable events such as the
purchase of a house or education expenses for children shall not be considered
to be the result of an unforeseeable financial emergency. Emergency Benefits
shall be paid first from the Participant's In-Service Distribution Accounts, if
any, to the extent the Vested balance of one or more of such In-Service
Distribution Accounts is sufficient to meet the emergency, in the order in which
such Accounts would otherwise be distributed to the Participant. If the
distribution exhausts the Vested In-Service Distribution Accounts, the Vested
Retirement Distribution Accounts may be accessed. With respect to that portion
of any Distribution Option Account which is distributed to a Participant as an
Emergency Benefit, in accordance with this Article, no further benefit shall be
payable to the Participant under this Plan. Notwithstanding anything in this
Plan to the contrary, a Participant who receives an Emergency Benefit in any
Plan Year shall not be entitled to make any further deferrals for the remainder
of such Plan Year. It is intended that the Committee's determination as to
whether a Participant has suffered an "unforeseeable financial emergency" shall
be made consistent with the requirements under Section 457(d) of the Code.

                                   ARTICLE 11

                            Accelerated Distribution

     11.1 Availability of Withdrawal Prior to Retirement. Upon the Participant's
written election, the Participant may elect to withdraw all or a portion of the
Participant's vested Distribution Option Account at any time prior to the time
such Distribution Option Account otherwise becomes payable under the Plan,
provided the conditions specified in Section 11.3, Section 11.4, and Section
11.5 are satisfied.

     11.2 Acceleration of Periodic Distributions. Upon the Participant's written
election, the Participant or Participant's Beneficiary who is receiving
installment payments under the Plan may elect to have the remaining installments
distributed in the form of an immediately payable lump sum, provided the
condition specified in Section 11.3 is satisfied.



                                       18
<PAGE>

     11.3 Forfeiture Penalty. In the event of a withdrawal pursuant to Section
11.1, or an accelerated distribution pursuant to Section 11.2, the Participant
shall forfeit from his Distribution Option Account from which the withdrawal is
made an amount equal to 10% of the amount of the withdrawal or accelerated
distribution, as the case may be. The forfeited amount shall be deducted from
the applicable Distribution Option Account prior to giving effect to the
requested withdrawal or acceleration. The Participant and the Participant's
Beneficiary shall not have any right or claim to the forfeited amount, and the
Company shall have no obligation whatsoever to the Participant, the
Participant's Beneficiary or any other person with regard to the forfeited
amount.

     11.4 Minimum Withdrawal. In no event shall the amount withdrawn in
accordance with Section 11.1 be less than 25% of the amount credited to the
Participant's Distribution Option Account immediately prior to the withdrawal.

     11.5 Suspension from Deferrals. In the event of a withdrawal pursuant to
Section 11.1, a Participant who is otherwise eligible to make deferrals under
Article 4 shall be prohibited from making any deferrals with respect to the Plan
Year immediately following the Plan Year during which the withdrawal was made,
and any election previously made by the Participant with respect to deferrals
for that Plan Year shall be void and of no effect.

                                   ARTICLE 12

                                  Miscellaneous

     12.1 Amendment and Termination. The Plan may be amended, suspended,
discontinued or terminated at any time by Charming Shoppes; provided, however,
that no such amendment, suspension, discontinuance or termination shall reduce
or in any manner adversely affect the rights of any Participant with respect to
benefits that are payable or may become payable under the Plan based upon the
balance of the Participant's Accounts as of the effective date of such
amendment, suspension, discontinuance or termination.

     12.2 Claims Procedure.

                  (a) Claim. A person who believes that he is being denied a
benefit to which he is entitled under the Plan (hereinafter referred to as a
"Claimant") may file a written request for such a benefit with the Benefits
Department of the Company, setting forth his or her claim.

                  (b) Claim Decision. Upon receipt of a claim, the Benefits
Department of the Company shall advise the Claimant that a reply will be
forthcoming within ninety (90) days and shall, in fact, deliver such reply
within such period. The Benefits Department of the Company may, however, extend
the reply period under special circumstances for an additional ninety (90) days.
If the claim is denied in whole or in part, the Claimant shall be provided a
written opinion, using language calculated to be understood by the Participant,
setting forth:




                                       19
<PAGE>


                           (i) the specific reason or reasons for the denial;

                           (ii) specific reference to relevant provisions of the
Plan on which the denial is based;

                           (iii) a description of any additional or material
information necessary for the Claimant to perfect his or her claim and an
explanation why such additional or material information is necessary;

                           (iv) appropriate information as to the steps to be
taken if the Claimant wishes to submit the claim for review;

                           (v) the time limits for requesting a review under
subsection (c) and for review under subsection (d) hereof; and

                           (vi)     the Claimant's  right to bring an action for
benefits under Section 502 of the Employee Retirement Income Security of 1974,
as amended ("ERISA"), following an adverse benefit determination on appeal.

                  (c) Request for Review. Within sixty (60) days after the
receipt by the Claimant of the written opinion described above, the Claimant may
request in writing that the Committee review the determination of the Benefits
Department of the Company. The Claimant written request for review must set
forth all the facts upon which the appeal is based. The Claimant or his duly
authorized representative may, but need not, review the pertinent documents and
obtain, upon request and without charge, copies of all information relevant to
your claim. If the Claimant does not request a review of the initial
determination within such sixty (60) day period, the Claimant shall be barred
and estopped from challenging the determination.

                  (d) Review of Decision. Within sixty (60) days after the
Committee's receipt of a request for review, it will review the initial
determination. After considering all materials presented by the Claimant, the
Committee will render a written opinion, written in a manner calculated to be
understood by the Claimant, setting forth the specific reasons for the decision,
specific references to the pertinent Plan provisions on which the decision is
based, the Claimant's right to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records and other
information relevant to the claim for benefits, and the Claimant's right to
bring a civil action under section 502(a) of ERISA. If special circumstances
require that the sixty (60) day time period be extended, the Committee will so
notify the Claimant and will render the decision as soon as possible, but no
later than one hundred twenty (120) days after receipt of the request for
review.

     12.3 Designation of Beneficiary. Each Participant may designate a
Beneficiary or Beneficiaries (which Beneficiary may be an entity other than a
natural person) to receive any payments which may be made following the
Participant's death. Such designation may be changed or canceled at any time
without the consent of any such Beneficiary. Any such designation, change or
cancellation must be made in a form approved by the Committee and


                                       20
<PAGE>

shall not be effective until received by the Committee, or its designee. If no
Beneficiary has been named, or the designated Beneficiary or Beneficiaries shall
have predeceased the Participant, the Beneficiary shall be the Participant' s
estate. If a Participant designates more than one Beneficiary, the interests of
such Beneficiaries shall be paid in equal shares, unless the Participant has
specifically designated otherwise.

     12.4 Limitation of Participant's Right. Nothing in this Plan shall be
construed as conferring upon any Participant any right to continue in the
employment of the Company, nor shall it interfere with the rights of the Company
to terminate the employment of any Participant and/or to take any personnel
action affecting any Participant without regard to the effect which such action
may have upon such Participant as a recipient or prospective recipient of
benefits under the Plan.

     12.5 No Limitation on Company Actions. Nothing contained in the Plan shall
be construed to prevent the Company from taking any action which is deemed by it
to be appropriate or in its best interest. No Participant, Beneficiary, or other
person shall have any claim against the Employer as a result of such action. Any
decisions, actions or interpretations to be made under the Plan by the Company
or the Board, or the Committee acting on behalf of the Company, shall be made in
its respective sole discretion, not as a fiduciary, need not be uniformly
applied to similarly situated individuals and shall be final, binding and
conclusive on all persons interested in the Plan.

     12.6 Obligations to Company. If a Participant becomes entitled to a
distribution of benefits under the Plan, and if at such time the Participant has
outstanding any debt, obligation, or other liability representing an amount
owing to the Employer, then the Employer may offset such amount owed to it
against the amount of benefits otherwise distributable. Such determination shall
be made by the Committee.

     12.7 Nonalienation of Benefits. Except as expressly provided herein, no
Participant or Beneficiary shall have the power or right to transfer (otherwise
than by will or the laws of descent and distribution), alienate, or otherwise
encumber the Participant's interest under the Plan. The Company's obligations
under this Plan are not assignable or transferable except to (a) any corporation
or partnership which acquires all or substantially all of the Company's assets
or (b) any corporation or partnership into which the Company may be merged or
consolidated. The provisions of the Plan shall inure to the benefit of each
Participant and the Participant's Beneficiaries, heirs, executors,
administrators or successors in interest.

     12.8 Protective Provisions. Each Participant shall cooperate with the
Employer by furnishing any and all information requested by the Employer in
order to facilitate the payment of benefits hereunder, taking such physical
examinations as the Employer may deem necessary and taking such other relevant
action as may be requested by the Employer. If a Participant refuses to
cooperate, the Employer shall have no further obligation to the Participant
under the Plan, other than payment to such Participant of the then current
balance of the Participant's Distribution Option Accounts in accordance with his
prior elections.



                                       21
<PAGE>

     12.9 Withholding Taxes. The Company may make such provisions and take such
action as it may deem necessary or appropriate for the withholding of any taxes
which the Company is required by any law or regulation of any governmental
authority, whether Federal, state or local, to withhold in connection with any
benefits under the Plan, including, but not limited to, the withholding of
appropriate sums from any amount otherwise payable to the Participant (or his
Beneficiary). Each Participant, however, shall be responsible for the payment of
all individual tax liabilities relating to any such benefits.

     12.10 Unfunded Status of Plan. The Plan is intended to constitute an
"unfunded" plan of deferred compensation for Participants. Benefits payable
hereunder shall be payable out of the general assets of the Company, and no
segregation of any assets whatsoever for such benefits shall be made.
Notwithstanding any segregation of assets or transfer to a grantor trust, with
respect to any payments not yet made to a Participant, nothing contained herein
shall give any such Participant any rights to assets that are greater than those
of a general creditor of the Company.

     12.11 Severability. If any provision of this Plan is held unenforceable,
the remainder of the Plan shall continue in full force and effect without regard
to such unenforceable provision and shall be applied as though the unenforceable
provision were not contained in the Plan.

     12.12 Governing Law. The Plan shall be construed in accordance with and
governed by the laws of the Commonwealth of Pennsylvania, without reference to
the principles of conflict of laws.

     12.13 Headings and Captions. Headings and captions are inserted in this
Plan for convenience of reference only and are to be ignored in the construction
of the provisions of the Plan.

     12.14 Gender, Singular and Plural. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, or neuter, as the identity
of the person or persons may require. As the context may require, the singular
may read as the plural and the plural as the singular.

     12.15 Notice. Any notice or filing required or permitted to be given to the
Committee under the Plan shall be sufficient if in writing and hand delivered,
or sent by registered or certified mail, to the Benefits Department, or to such
other entity as the Committee may designate from time to time. Such notice shall
be deemed given as to the date of delivery, or, if delivery is made by mail, as
of the date shown on the postmark on the receipt for registration or
certification.









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<PAGE>

                                   ARTICLE 13
                                    SIGNATURE

     This Plan is hereby adopted and approved, to be effective as of December
23, 2003.


                                     Charming Shoppes, Inc.



                                     By:___________________________
                                        Colin D. Stern
                                        Executive Vice President,
                                        General Counsel and Secretary









Approved by the Board of Directors on June 26, 2004













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